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New buildings being built in Los Angeles in 2018

California Can’t Wait on All-Electric New Building Code

In the past year, California cities have captured national attention with groundbreaking policies to reduce the use of fossil fuels in buildings, cutting carbon emissions and safeguarding public health in the process. This momentum has centered on an important first step: ensuring new buildings are efficient, modern, and all-electric. Still, the need for state leadership remains.

The California Energy Commission (CEC) has an opportunity to demonstrate this leadership over the next several months with the 2022 building energy code cycle, which could require all-electric new construction statewide. Acting today will have far-reaching benefits—and conversely, the costs of missing this cycle are significant. According to RMI analysis, delaying the code update until the next cycle would result in an additional three million tons of carbon emissions by 2030—the equivalent of putting 650,000 more cars on the road for a year.

The CEC should require all-electric new construction in the upcoming code cycle to help achieve California’s climate, health, and economic goals.

California Is Approaching a Key Decision Point for an All-Electric Building Code

Every three years, the CEC issues its Building Energy Efficiency Standards (also called the “Title 24” energy code because of the applicable regulatory section). The CEC is currently at a key point in the revision process for the 2022 code cycle and will either ensure new buildings are on track to reach the state’s ambitious climate goals through all-electric new construction or allow those buildings to burn fossil fuels that increase pollution.

The decisions in this 2022 code cycle will go into effect at the beginning of 2023, and the next round of code revisions won’t be implemented until 2026. In other words, the decisions made now will determine the climate footprint of buildings constructed up to six years from nowa footprint that will stretch decades into the future, for the life of the buildings.
 

All-Electric New Construction Advances California’s Climate, Health, and Economic Goals

An all-electric new construction code would be a clear win for California. In a recent post, our colleagues detailed the wide-ranging benefits, which include reduced building sector carbon emissions, improved health and air quality, increased affordability for consumers, reduced utility customer costs and investor risk, and additional support for the advanced electric technology market and local governments.

A statewide move to all-electric new construction would not come out of the blue. Over 30 cities and counties in California have passed policies requiring or encouraging all-electric new construction. Several of the state’s major utilities (including California’s second-largest gas provider, Pacific Gas & Electric Co.) submitted letters supporting a statewide all-electric code for 2022, citing the value of decisive state action for business operations.

Large trade associations for architects and electrical contractors have also voiced their support and affirmed their readiness for all-electric construction.

Importantly, all-electric new construction is harmonious with California’s push for safe, affordable housing. All-electric affordable housing developments are already gaining momentum, motivated by health, financial, and environmental goals. Gas combustion in the home contributes to air pollution and respiratory illness, which disproportionately burden low-income and disadvantaged communities. Recent studies suggest the impacts may be larger than previously understood. Approximately 12 million Californians are regularly exposed to levels of nitrogen oxides from gas appliances in their homes that would exceed federal health-based standards if found outside. Meanwhile, buildings are the number one source of premature deaths from air pollution statewide, accounting for over 6,000 premature deaths per year.

 

California Needs to Increase the Speed of Emissions Reductions from the Building Sector

A recent report by Energy Innovation showed that California is not on track to meet its 2030 greenhouse gas emissions goals (40 percent reduction below 1990 levels). While electricity-sector emissions continue to decline, other sectors are going in the wrong direction. Direct emissions from buildings increased each of the three most recent years in California’s emissions inventory, driven primarily by gas.

Waiting for the next code cycle (2025) will endanger California climate mandates and cost California ratepayers and property owners. RMI analyzed recent levels of new construction in California, to evaluate the emissions and financial impacts of including an all-electric requirement in 2022 versus waiting until 2025. At current emissions rates, a three-year delay would result in 3 million additional metric tons of carbon emissions by 2030.

That delay would also result in more than $1 billion of unnecessary spending on new gas connection infrastructure, at high risk of becoming obsolete given California’s push to eliminate statewide greenhouse gas emissions in the next 25 years. Much of that expense would be borne by developers and property owners, but the broader customer base also subsidizes new gas connections and would bear hundreds of millions of dollars as well.

Just as importantly, delaying the transition to all-electric new buildings will delay the market transformation required to tackle the harder problem: decarbonizing California’s existing building stock. Addressing fossil fuel use in California’s 14 million homes and 7.5 billion sq. ft. of commercial floor space is a complex, multi-year task, and a crucial first step is to stop making the problem worse.

 

The Path Ahead

Last year brought a wave of local action on building electrification throughout California, paving new ground and offering lessons to policymakers throughout the country.

With the arrival of the 2022 building code, the CEC will send a clear policy signal one way or the other: either California will move toward clean, all-electric buildings statewide or the state will continue investing in polluting and expensive infrastructure that will soon become obsolete. We simply cannot wait another three years for action. In order to put California on a path to achieve its climate goals, to restore clean and healthy air to all Californians, and to avoid wasting substantial money and resources, the CEC must commit to an all-electric energy code in the 2022 cycle.

 

Emissions impacts are based on RMI analysis using California Energy Policy Simulator, 2018 residential new construction data (US Census), and commercial gas demand. Financial impacts are based RMI analysis of 2018 residential new construction (US Census), gas customer connection estimates from E3 Residential Building Electrification Study (2019) and Palo Alto Electrification Study (2016), and 2019 gas utility rate cases.