Grantee Research Project Results
Final Report: OlogyBricks: High Thermal Performance Hempcrete Construction Bricks
EPA Contract Number: 68HERC21C0032Title: OlogyBricks: High Thermal Performance Hempcrete Construction Bricks
Investigators: Engel, Gina L
Small Business: Earth Merchant
EPA Contact: Richards, April
Phase: I
Project Period: March 1, 2021 through August 31, 2021
Project Amount: $99,974
RFA: Small Business Innovation Research (SBIR) - Phase I (2021) RFA Text | Recipients Lists
Research Category: Small Business Innovation Research (SBIR)
Description:
Problem: There is a clear economic and environmental need for building materials and approaches that improve energy efficiency in American homes, both through retrofitting existing structures and in new construction. Each year American households spend $230 billion for energy for home heating, cooling, lighting, entertainment, and other functions accounting for 20 percent of the total energy consumption nationwide (EPA, 2018). The impacts of high energy costs are more acutely felt by low-income households; bringing low-income housing up to the efficiency level of the average American home could reduce the energy cost burden of these households by 35 percent, improving economic security, comfort, and health (EPA, 2018). With 37 percent of American carbon dioxide emissions coming from fossil fuel combustion to create electricity, improving energy efficiency reduces greenhouse emissions (EPA, 2018). To make meaningful progress on the climate crisis, however, there should be a more aggressive and innovative approach to housing. Narrowly focusing on improving energy efficiency alone can result in initiatives and policies that actually increase, rather than lower, emissions (Builders for Climate Action, 2019). The priority needs to be on technology that is carbon negative, and as a plant-based material, hempcrete bricks can store more atmospheric carbon than is emitted during the harvesting and manufacturing process (Builders for Climate Action, 2019).
- Currently, there are no companies making blocks with the carbon capture technology
- Currently, there are very few farmers growing hemp for fiber
- Currently, the US building industry severely lacks “green” building materials that have been designed, manufactured, and used in the United States.
- Currently, international and national building codes are being addressed to include hemp and other sustainable building materials.
- Currently, there are large corporations, government, and local agencies, and major brands demanding sustainable initiative action from their suppliers and vendors.
- The cost of lumber has increased 14% since 2019
Solution: OlogyBricks are durable, lightweight, and will help meet the need for improved energy efficiency in homes by offering robust insulation properties, low thermal conductivity, and innovative hygrothermal performance. OlogyBricks will offer R 2.4 per inch, a net improvement over traditional façade wall systems with the current standard of masonry brick at R 0.2 to R 0.7 per inch (University of Washington, 2020) or about the same insulative value as air. OlogyBricks hempcrete bricks will offer innovative thermal performance benefits beyond steady-state R-values, making it uniquely suited for improving not just energy efficiency, but also indoor air quality. Hempcrete is vapor active, with its pore structure and pore connectivity responding to changes in humidity by absorbing and releasing moisture (Lawrence et. al., 2013). This creates a hygric buffer, and since moisture transport through a building envelope significantly impacts air-conditioning loads, such buffering has been found to reduce energy consumption by 45% compared to cellular concrete which is currently used widely in commercial construction (le et. al., 2010).
Market Size For every 100 American households that qualify as extremely low income, at or below 30% of area median income, there are only 36 affordable and available homes: in some parts of the country, the number of available homes is 14 per 100 households (National Low Income Housing Coalition, 2020). The need to build more energy-efficient affordable housing is complicated by the global climate crisis and the negative impacts of construction on climate and the environment.
The strong construction market is now intersecting with the dual crises of climate change and the lack of affordable housing, demanding an innovative approach that provides high-quality housing with reduced production costs, technology that can sequester carbon, reduced embedded energy costs, and ensure a lower impact end-of-life stage. This creates a unique market opportunity for our product, with leaders in the industry eager for new approaches. Builders for Climate Action is a growing coalition of builders, architects, manufactures, and policymakers with a mission to transform building practices to be carbon negative. One of the group’s core rationales is that by shifting to plant-based materials, “we can feasibly and affordably capture and store vast amounts of carbon in buildings, transforming the sector from a major emitter to a major carbon sink (Builders for Climate Action, 2019).”
USA MARKET: While hempcrete structures have been built in Europe for several decades since it has only been legal very recently in the U.S., most building codes do not address it yet. Still, hempcrete structures have been permitted, on a case-by-case basis, by municipalities in Oregon, California, Washington, North Carolina, Colorado, Virginia, Texas, Florida, and Hawaii (Woods, 2018; Popescu,2020; American Lime Technology, 2019).
Summary/Accomplishments (Outputs/Outcomes):
Our team believes we will be able to build a 1200 sq ft home with 2.5 acres of industrial hemp fiber and hurd. This innovation represents the potential to enter a $68B green construction materials industry. The construction industry is begging for innovation, for local products that can scale. We can produce and scale in each state with the cooperation of hemp farmers. We believe we can commit 10 homes to be built in the first year of 2023 with our estimated production rate and meet the demand of an existing letter of intent.
Conclusions:
TARGET MARKET: Our primary market will be construction contractors, real estate developers and building firms, non-profit housing agencies, and home improvement and home construction, consumers. The United States construction industry creates more than $1.3 trillion worth of structures annually and employs more than 7 million people (Associated General Contractors of America, 2020). Through the first half of 2020, U.S. construction spending was $667.9 billion, a 1.2% increase over the same period in 2019 (U.S. Census Bureau, 2020). Residential construction in 2020 was at an annual adjusted rate of $534.2 billion (U.S. Census Bureau, 2020). The United States also has a severe lack of affordable housing.
Objectives
The purpose of this plan is to provide investors with the information necessary to evaluate the scope and future growth of Earth Merchant LLC in the marketplace. In addition to serving as a roadmap for interested investors.
- A significant market opportunity exists when analyzing the current market demands and competitive landscape;
- The team set in place is qualified to execute a well-thought-out operational, marketing, sales strategy, including research, and development on other hemp-based materials.
- The correct capital structure will allow for a long-lasting, profitable, more importantly, scalable business.
To achieve the Company’s objectives, Earth Merchant LLC is looking for $750,000 in total funding. The funding will be utilized in acquiring assets, staffing, operations, and a prototype build. Earth Merchant’s financial model shows consistent growth for the brand OlogyBricks™ over the next five years. By year 3, plans call for the Company to achieve $2.4 million in annual gross revenue with a 36-40% return.
The perspectives, information and conclusions conveyed in research project abstracts, progress reports, final reports, journal abstracts and journal publications convey the viewpoints of the principal investigator and may not represent the views and policies of ORD and EPA. Conclusions drawn by the principal investigators have not been reviewed by the Agency.