The Energy Code & Housing: How Much Is Too Much?

Issue: The 2012 International Energy Conservation Code currently being promulgated by the Department of Labor and Industry (DLI) through the rule making process. Problem: 1. Been There, Rotted That.

The proposed energy code includes building practices we know to cause moisture problems in attics, basement walls, rim joists, and above grade walls and creates housing durability concerns for Minnesota homeowners and contractors.

2. Modeling of actual homes show that implementing the 2012 IECC will not save

homeowners anywhere near 30% in energy costs. 3. The new code will result in an 8.6% increase in the cost of new housing in Minnesota

in 2013. The proposed energy code will increase the cost of new construction on average by an initial estimate of $8,000. If fire sprinklers were included as required by the residential code it would add an additional $4,000, if the home is on private well it would add an additional $12,000. The total cost of the proposed residential building and energy codes together is between $12,000 and $20,000.

4. The National Association of Home Builders recently completed a study revealing when the price a home increases by $4,000 in Minnesota, 21,000 potential homeowners are priced out of the market for a new home.

Solution: 1. Publish and analyze data collected by the Conservation Improvement Program (CIP)

run by the Department of Commerce on energy performance of Minnesota’s recently built homes. This data will provide a baseline of how Minnesota’s new homes are performing.

2. Adopt a new code in Minnesota when the facts about cost and energy savings can be properly identified by DLI as compared to Minnesota’s current energy code requirements.

3. Eliminate any code options that are known to cause durability issues in new home

construction.

4. Be reasonable about what energy paybacks a homeowner is willing to pay for. All of the data used for this analysis will be posted on BAM’s website at: www.bamn.org/news including REM/Rate files used to determine energy savings.

April 2, 2012 William D. Fay Executive Director Energy Efficient Codes Coalition 1850 M Street, NW Suite 600 Washington DC, 20036 Dear Mr. Fay, Recently a report from the Building Codes Assistance Project (BCAP) titled, Minnesota Residents Buying 2012 IECC Homes Will Save Thousands was distributed by the Minnesota Department of Labor and Industry to members and interested parties of the Technical Advisory Committee studying provisions of the 2012 IECC. The Builders Association of Minnesota (BAM) believes the BCAP analysis for Minnesota is seriously flawed for three reasons. First, it conflicts with the 2012 International Residential Code (2012 IRC). Second, it grossly overestimates energy savings in Minnesota, and third, the costs of energy upgrades are underestimated. 1) The BCAP Analysis for Minnesota Conflicts with the 2012 IRC Minnesota homes are built in climate zones 6 and 7. The prescriptive path of the 2012 International Energy Conservation Code (IECC) requires that home builders construct an exterior frame wall with an R-21 interior insulation and R-5 exterior rigid insulation. The BCAP analysis for Minnesota assumed that a home builder would comply by building a 2x6 frame wall with an R-21 batt and R-5 structurally insulated sheathing (SIS) on the exterior, see page 5 of the Exterior Walls section. Footnote 8 on page 5 of this report describes another assumption, “Incremental costs for walls with SIS also take into account savings from eliminating a conventional vapor barrier, a function that is included in SIS panels.” Vapor retarder requirements for above grade walls in the 2012 IECC can be found in the 2012 IRC. Section R702.7.1 of the 2012 IRC strictly prohibits the removal of a Class I vapor retarder unless a much thicker rigid insulation is used. Specifically a minimum R-11.25 rigid insulation in climate zone 6 (Southern Minnesota) and R-15 in climate zone 7 (Northern Minnesota). The BCAP analysis is not code compliant with the 2012 IRC. 2) BCAP’s Analysis Overestimates Energy Savings The BCAP report states that Minnesota homeowners buying homes built to the 2012 IECC will save $848 ($71/month) or $925 ($77/month) in energy costs per year depending on the climate zone. It is impossible to save this much in energy costs per year because this is what newly built homes use for average heating and cooling energy per year. If builders made the BCAP saving claims to potential homeowners, the builders would be sued for breach of contract.

Since 2000, Minnesota’s residential energy code has required a sealed air barrier and mechanical ventilation in every single-family home. Data collected in Minnesota on new homes built to the 2006 IECC with Minnesota amendments show the average air changes per hour (ACH50) for new homes is 1.7 in our state. This is almost half of the maximum 3.0 ACH air leakage rate required by the 2012 IECC. Minnesota has been building tight and ventilating right for over a decade. The only way to explain BCAP’s energy savings estimate is that the national air change rate of 7.0 ACH was used or a furnace efficiency of less than 90% AFUE was used to evaluate Minnesota’s energy efficiency. Both assumptions are wrong and would produce false conclusions. 3) BCAP’s Cost of Energy Upgrades Are Underestimated BCAP’s estimates of increased cost for complying with the 2012 IECC are estimated at $2,682 to $3,959. Builder estimates of complying with the 2012 IECC are between $7,000 and $9,000 per home. If BCAP used RS Means cost data to determine cost, subcontractor overhead is not included in the final price to the consumer. That is not a realistic assumption for the average cost paid by a consumer. The BCAP report states that, “More details of the modeling assumptions used in this analysis are available on request.” The Builders Association of Minnesota Research Director, Karen Linner e-mailed a request for this information on March 21, 2012. A second e-mail request was sent on March 27th. BAM has not received a response. I am requesting BCAP write a letter retracting the Minnesota analysis immediately. It is not a valid nor is it an accurate representation of the work this state has done to build energy efficiently. We are also requesting the Energy Efficient Codes Coalition retract or correct any and all state analyses that are inconsistent with the 2012 IRC. Home builders must consider the house as a whole system. Adopting the energy code without consideration for the residential code exposes home builders and consumers to potential durability issues and false claims of energy savings. Respectfully,

Pamela Perri Executive Vice President Builders Association of Minnesota CC: Ken Peterson, Commissioner, Minnesota Department of Labor & Industry Don Surrena, National Association of Home Builders Ron Majette, U.S. Department of Energy Richard Hauffe, International Code Council