Improving Building Energy Codes Fact Sheet

Support Sec. 3301(b) and 5201-2 in Lieberman-Warner Climate Security Act

Building Energy Efficiency

Buildings consume about 40 percent of the total energy used in the United States, and are responsible for about 40 percent of all U.S. carbon dioxide emissions. Efficient buildings avoid global warming, reduce demand on the power grid and stress on natural gas supplies, improve local air quality, and save consumers money. A 2006 report by the McKinsey Global Institute found that we could reduce energy use in new and existing buildings by more than one quarter by 2020 with measures that pay for themselves within ten years.

The choices we make in designing and constructing new buildings (and renovating old ones) will affect energy use for many decades to come. Building design and construction provide by far the best and most cost-effective opportunity to build in energy-efficient features that will last for the lifetime of the building. Thus it is critical to make energy efficiency a fundamental part of building design and construction.

Major improvements in building efficiency are possible. The American Institute of Architects has called for reducing fossil fuel use in new and renovated buildings by 60 percent by 2010 and by 100 percent by 2030. The American Society of Heating, Refrigerating, and Air-conditioning Engineers (ASHRAE), which sets model building energy standards for commercial buildings, is already working to achieve 30 percent energy savings by 2010. The Department of Energy supports 30 percent savings in both residential and commercial building energy codes.

Why Improve Building Energy Codes

Building energy codes are the foundation of energy policy for the buildings sector for several reasons:

• Building energy codes overcome market barriers, which otherwise result in underinvestment in building energy efficiency. For example, builders have little incentive to invest in energy efficiency since they pay the up-front costs but not the energy bills of the buildings they develop, and buyers cannot easily see how efficient a new building will be.
• Building energy codes save consumers money—while there may be modest initial cost for energy efficiency improvements, that cost is rolled into the mortgage and is more than paid back through lower energy bills. As the total monthly cost to the homeowner—mortgage payments plus utility bills—is lower, energy efficiency makes homes more affordable.
• Building energy codes create the foundation for “beyond-code” high-performance energy-efficient buildings. Rather than widening the gap between the majority of buildings built to code and the highest performance buildings, energy efficiency codes raise the baseline and provide the foundation for market-driven, above-code activities like Energy Star homes and utility programs.

If model building energy codes are strengthened by 30% starting in 2010 and by 50% starting in 2020—and if all states implement the codes—the impact will be considerable. In 2030 our nation could save 5% of its total energy use in buildings (3 quadrillion Btus), save consumers $25 billion a year, and reduce greenhouse gas emissions equal to taking 28 million cars off the road (150 million tons of carbon dioxide). Even without further code improvements, cumulative savings through 2050 would reach more than 100 quads of energy and 6 billion metric tons of carbon dioxide.

Proposal for Advanced Building Energy Codes

Building energy codes currently are set in a complicated process that does not effectively meet the national need to reduce energy demand:

• National model codes are updated every few years, typically with small incremental improvements, by two independent professional organizations: the International Energy Conservation Code (IECC) from the International Code Council for residential buildings, and ASHRAE Standard 90.1 for commercial buildings.
• The Department of Energy (DOE) makes a determination within one year (though they have repeatedly missed that deadline) solely on whether the amended model code saves energy compared to the previous version.
• States set the actual building energy codes (except a few states that leave codes to local governments) based on the national models. States are required to adopt a commercial code at least as stringent as the national model within two years of DOE’s determination. For residential codes, states are required to look at updates to the national model and either adopt them or explain why they chose not to.

Sec. 5201-2 in the Lieberman-Warner Climate Security Act, similar to Sec. 9031 of the House energy bill last year (H.R. 3221), would spur major improvements in building energy codes by setting national performance targets that rise gradually over time, and encouraging states to meet these targets. However, it would not federalize building codes—it is carefully designed to leave states and local governments in charge of setting their own building codes and to leave independent organizations primary responsibility for setting the national models. Specifically, the provision would:

• Set a target for both the residential and commercial national model building energy codes of 30% improvement by 2010 and 50% improvement by 2020 compared to the most recent versions (DOE may set interim and subsequent targets). DOE is to help meet these targets, and if DOE determines that the IECC or ASHRAE Standard 90.1 does not meet them, DOE is to propose modified codes that do.
• Require states within two years to adopt residential and commercial building codes that save at least as much energy as the national models (similar to the code requirement for commercial buildings today).
• Require states within three additional years to achieve 90% compliance with their building energy codes (measured by number of buildings or energy use), verified by inspections of a sample of buildings.
• Increase DOE assistance to the states and to the national organizations, and retain a provision from the Energy Policy Act of 2005 for grants to states for implementing plans to achieve high rates of compliance with their codes.

Sec. 3301(b) in the Lieberman-Warner bill also would allocate one percent of the carbon credits to states that meet the requirements under this provision, providing an important incentive to states to act.

For more information please contact Alliance policy staff at (202)857-0666 or policyinfo@ase.org or visit www.ase.org and www.bcap-energy.org.

The Alliance to Save Energy is a coalition of prominent business, government, environmental and consumer leaders who promote the efficient use of energy worldwide to benefit consumers, the environment, the economy, and national security.

Updated April 2008