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Which states could gain the most from energy-saving building codes?

There’s federal money on the table to help states modernize their building energy codes. But some states could benefit from it more than others.
By Alison F. Takemura

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Two large cranes sit next to a building under construction against the backdrop of a bright blue sky
(Jeffrey Greenberg/UCG/Universal Images Group/Getty Images)

Louisiana, North Carolina and Colorado top the list of states that would benefit most from an unsexy but vital tactic for cutting carbon pollution: updating building energy codes.

Energy codes set minimum standards for new construction by requiring features such as thick insulation, efficient windows and sealed air ducts, which reduce how much energy — and fossil fuels — buildings waste. Buildings are responsible for about 34 percent of U.S. greenhouse gas emissions if you include emissions from the electricity they use, so strong energy codes are a slam dunk for the climate.

But some states have more to gain than others from updating these codes, according to a new analysis by the nonprofit American Council for an Energy-Efficient Economy.

States that are experiencing a building boom, have carbon-reduction goals or have weak (or nonexistent) energy codes are fertile ground for tighter requirements that would slash emissions and save residents money on their power bills.

For example, if you’ve got a lot of new construction activity in the state, then you’re going to see a bigger benefit from better energy codes,” said Michael Waite, senior manager in the ACEEE buildings program and author of the study.

The findings matter because the federal government is now offering money to states to adopt and implement better energy codes. The Department of Energy announced $45 million in competitive grant funding last month, the first batch of such funding from the 2021 Infrastructure Law. In total, the law will provide $225 million distributed over five years to help states revamp their energy codes.

The deadline for states to let DOE know they’re interested is Jan. 31. States need to move on this,” Waite told Canary Media. Federal support is there. We hope states get on top of taking advantage of it.”

By ACEEE’s analysis, these states should line up first: 

3. Colorado: The state is experiencing a construction boom and needs to do a lot of work to hit their greenhouse gas emissions-reduction targets in 2030,” Waite said.

2. North Carolina: The state also has a quick pace of new construction and an ambitious greenhouse gas reduction target. But what makes it rank higher than Colorado is that better codes would deliver more savings on energy costs for residents.

1. Louisiana: Even though the state has lukewarm construction activity, Louisiana has a trifecta that makes better energy codes a no-brainer: significant building emissions, a net-zero emissions goal set by the governor and even more potential for energy-bill savings than Colorado or North Carolina.

Portion of ACEEE table that puts Louisiana first among states for benefits from adopting better energy codes.
Louisiana, North Carolina and Colorado lead the rankings for which states would benefit most from implementing better building energy codes. (ACEEE)

We want people on the ground pushing for more efficient buildings to be able to point to this analysis and say, Look at all these factors across our state. We have a great opportunity here,’” Waite said.

More funding for better energy codes still to come

The infrastructure law sets a low bar by supporting states in making any improvement to their building energy code. But a different batch of funding from the 2022 Inflation Reduction Act will demand more. It will provide $1 billion for states to adopt codes that meet or beat the national model energy codes,” Waite said. There are two such model codes, one for residential buildings and one for commercial buildings. As shown in the chart below, they have helped to steadily bring down building energy use over the last few decades.

Graph showing building codes have set standards that have cut energy use by more than half from 1975 to 2021.
Energy codes for residential buildings (IECC) and commercial buildings (ASHRAE 90.1) have been revised and strengthened over time. (DOE)

About a third of the Inflation Reduction Act’s funding will go to states to implement these standards, Waite said. Two-thirds of the pot, however, will help states pursue even greater ambitions: net-zero energy building codes.

The opportunity for energy-efficient buildings is dangling in front of all states. Who will reach out and grab it?

Alison F. Takemura is staff writer at Canary Media. She reports on home electrification, building decarbonization strategies and the clean energy workforce.