The Waxman-Markey climate and energy bill is best known for its extensive provisions for a cap and trade system to set a price on carbon emissions and gradually reduce them over time. But in the bill’s more than 900 pages (be careful when you download it!) are some interesting provisions that mandate significant improvements to energy codes that govern building construction.
It is hard to exaggerate the importance of building codes. Every decision that goes into building any structure in the United States and Canada—from wiring to plumbing and paint to siding—is completely conditioned by them. If you are inside a building right now take a minute and look around. Each aspect of your environment is the process of an accretion of innovation and politics geared primarily at safety and comfort—and reducing costs.
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This is what makes the code changes in Waxman-Markey so powerful even though they represent a rather small aspect of the larger legislation (about 50 pages). The building code elements of the bill mandate significant increases in efficiencies in commercial buildings and homes—30 percent improvement within one year of passage of the legislation and 50 percent by 2015.
But the legislation doesn’t stop there. Every year after that, efficiencies would need to increase by 5 percent until 2030. Those are some very large reductions in greenhouse gas emissions. The Alliance to Save Energy estimates 200,000,000 fewer tons of CO2 emitted if the provision passes which is the equivalent to the annual emissions of 37 million vehicles. The total energy savings would be 3 quadrillion Btus (that’s quadrillion with a q!)—which equates to lots of savings on energy bills.
Those are big numbers. and if fully implemented might even lead to the development of more zero net energy buildings. And the legislation directs the DOE to set targets in line with provisions of the Energy Independence and Security Act passed in 2007 which sets a goal of achieving “zero-net-energy use for new commercial buildings built after 2025.”
The legislation provides for a real hammer if states don’t adopt the improvements in their local codes by holding back their revenue allocations for implementation and other federal dollars. The Federal government would impose its own rules and enforcement on states and their local governments.
There is a bit of a catch. Building codes are notoriously complex and are governed by a number of different bodies—from the international level down to local city councils. The Department of Energy will work with the International Code Council and the American Society of Health, Refrigerating and Air-Conditioning Engineers (ASHRAE) to develop the standards, states will have to adopt those standards and then local jurisdictions will have to implement their own code updates to comply with state standards. The good news is these kinds of changes happen all the time but usually not without a lot of changes in the underlying legislation when builders and other industries lobby state legislatures and local governments. Some of these provisions may also change as the bill moves through congress for the same reasons.
Finally, the bill provides for building “labeling.” This is an incentive to improve existing buildings, especially when they are put up for sale or lease. Labeling—like the sticker on a car that tells you the gas mileage—should also reflect the required improvements in the code.
What about split incentives? The legislation doesn’t address this problem specifically. But the labeling section of the bill requires the EPA to establish energy measures for different building types, set performance measures, and work with local governments to develop disclosure programs. This could be useful for programs in our region that haven’t approached the split incentives problem because they are focusing on single family homes first.
In our region, Portland has a program called the Portland Energy Efficient Home Pilot (PEEHP), a $113,000 grant fund “created to offset the costs of constructing two homes . . . that perform above the energy efficiency level of the 2008 Oregon Energy Code standards.”
The program is interesting because it specifically requires case studies to record costs and complexity created by “new energy efficiency measures”—the kinds of measures being proposed in Waxman Markey. This puts Portland out in front in terms of testing out the kinds of increases to energy requirements that Waxman-Markey, if it passes, will require.
In British Columbia, the Provincial government took steps last year to green their building code as well, requiring new construction to meet rigorous energy and water conservation standards. Vancouver also has moved ahead with new efficiency requirements for new construction.
The provisions in Waxman-Markey are aggressive, but the region is already pushing hard for efficiencies. If the bill passes in its current form, the Northwest states will not only have a head start but also an even greater incentive to implement best practices from the programs they are piloting.