Making Buildings Part of the Climate Solution by Enforcing Aggressive Commercial Building Codes

This paper examines the impact of an aggressive commercial building codes policy in the United States. The policy would require both new construction and existing buildings that undergo major modifications to comply with higher building shell efficiency and more stringent equipment standards similar to the latest versions of the ASHRAE 90.1 Standard. Using the Georgia Tech version of the National Energy Modeling System (GT-NEMS), we estimate that the building codes policy could reduce the energy consumption of commercial buildings by 0.94 Quads in 2035, equal to 4% of the projected energy consumption of commercial buildings in that year. In the four targeted end-uses – space heating and cooling, water heating and lighting – estimated energy consumption would be 17%, 15%, 20% and 5% less than the Reference case forecast in 2035, respectively. The reduction of electricity and natural gas prices along with the consumption decline could save commercial consumers $12.8 billion in energy bills in 2035 and a cumulative $110 billion of bill savings between 2012 and 2035. The environmental benefits of the policy could also be significant. In 2035, 47 MMT of CO2 emissions could be avoided, generating cumulative benefits of $17 billion by 2035. The estimated benefit-cost ratio of this policy within the commercial sector is 1.4, with a resulting net benefit of $59 billion. The positive spillover effect of this policy would lead to an even higher economy-wide benefit-cost ratio