Credit: Jim Pierobon / Energy News Network

One of the region’s leading states for clean energy is at risk of falling behind in one category as a familiar debate plays out over its residential energy code.

State officials in Minnesota have delayed a decision by several months on a perennially controversial update to the code, which sets standards related to energy use for newly constructed homes.

Department of Labor and Industry Assistant Commissioner Scott McLellan said his agency needs to wait for the results of a federal performance study of the new, model 2018 residential energy code developed by the International Code Council.

The residential energy code often ignites debate because of its potential to disrupt the construction industry. Also, past energy codes have been blamed for mold, moisture, and other problems. The state now requires building scientists to study the potential impact prior to introducing a new code.

“The energy code can have a huge impact on how (homebuilders) put the house together,” McLellan said.

Advocates argue the update would reduce carbon emissions and save homebuyers money, while homebuilders contend it would yield few benefits for the added cost.

The state’s current residential energy code, adopted in 2015, is based on the International Code Council’s 2012 International Energy Conservation Code (IECC). Minnesota law requires updating building standards every six years. A delay could mean pushing residential energy code updates to 2024.

State officials don’t see a compelling need to act quickly, though, even as all the other code updates sent to the commissioner last week were recommended for adoption.

“The residential portion of the energy code has been set aside because the federal government hasn’t weighed in on whether the new code is more efficient than the previous edition,” McLellan said. “We have enough on our plate now.”

An Updated Code

Several groups advocating for the change recently sent a letter to the agency arguing the new residential code will level the playing field for builders, provide quality assurance for buyers, and reduce the amount of money spent on utility bills.

Ben Rabe, a senior policy associate with clean energy advocacy group Fresh Energy, believes if Minnesota punts on the new standard it might become an energy code laggard nationally. (The Energy News Network is an editorially independent publication of Fresh Energy.)

“We’ll be well behind recommendations in the model energy codes and that will be passed along to consumers who will pay higher energy bills,” Rabe said.

Research by Fresh Energy and the Midwest Energy Efficiency Alliance show the cost of following the 2018 standard should be around $2,036 a home, which would be amortized over a 30-year mortgage. The cost would pay for itself in energy savings in roughly four to five years, Rabe said, and result in annual savings of $129 to $139. Homes would see a 6 percent reduction in energy consumption.

Not all updates have shown those kind of results. A DOE report suggested upgrading from the 2012 to the 2015 code in Minnesota – something the state has not done – would save homeowners just $118 over 30 years. That kind of statistic leaves home builders wondering why they should bother with further code improvements.

However, Minnesota actually adopted an amended version of the 2012 code that included additional energy efficiency features that are not represented in the DOE research.

“When you take the changes into account there were considerable savings,” said Ian Blanding, senior building policy associate with MEEA. The DOE report “is a little misleading.”

Minnesota’s residential energy code is in line with other Midwest states but several of them are also considering a move to the 2018 IECC code, Blanding said. Builders in every state have waged objections to residential energy codes and do not think they should be mandatory, he said.

A DOE study that looked at impact of continuously upgrading residential energy codes found the cumulative energy cost savings in Minnesota would be $2.3 billion from 2010 to 2040 and avoid 14.3 million metric tons of carbon emissions.

Patrick Huelman, an associate extension professor and cold climate housing coordinator at the University of Minnesota, said as an outside observer he sympathizes with builders but thinks upgrading the code the right thing to do.

International codes come out every three years, he said, and builders complain, with justification, that the process never ends. It often takes advisory groups and state officials three years to reach agreement on a new code, only to discover an updated version has been issued.

But by adopting the 2018 version the state and industry could revisit areas that are working, and not working, in the current code, he said. The 2018 code “has things in there that are good for the consumer, and good for the builder,” Huelman said. “It’s not that much more stringent than earlier versions.”

The Home Builders’ View

The primary opponents, the powerful Builders Association of the Twin Cities and its subsidiary, Housing First Minnesota, think the update doesn’t yield many dividends and comes at a time when builders are still adjusting to the 2012 residential energy code.

A survey of the association’s members suggests the 2012 residential building code added approximately $7,000 to the cost of an average home, said Nick Erickson, the organization’s regulatory affairs manager.

State data suggests it was more like a $1 per square foot increase, substantially less than the builders’ survey estimated, McLellan said. An average new home in the United States is currently around 2,600 square feet.

Builders want affordability to play a larger role in the state residential energy code and see the 2018 update as only offering “a negligible increase in efficiency” that is “not worth the extra cost,” Erickson said.

The argument that Minnesota will not have updated residential energy codes for 12 years if it waits did not sway Erickson because Labor and Industry can open the rulemaking process at any time. Nor were his members concerned about not having the same standards as other states, he added.

Housing First Minnesota objected to what it said would be costly mandates in the 2018 code, such as having to install continuous foam insulation on exterior frame, a practice green building advocates say reduces heating costs and moisture problems.

Erickson said his organization’s members would rather build out a local “performance path” for homebuilders using the “home energy rating system,” or HERS, which gives homes a score anywhere from 130 to zero, with lower numbers meaning better energy efficiency.

“Homes are being built with remarkable efficiency, and that’s getting lost in the discussion,” he said. “We’re exceeding the code as it is right now.”

Frank is an independent journalist and consultant based in St. Paul and a longtime contributor to Midwest Energy News. His articles have appeared in more than 50 publications, including Minnesota Monthly, Wired, the Los Angeles Times, the Minneapolis Star Tribune, Minnesota Technology, Finance & Commerce and others. Frank has also been a Humphrey policy fellow at the University of Minnesota, a Fulbright journalism teacher in Pakistan and Albania, and a program director of the World Press Institute at Macalester College. Frank covers the state of Minnesota.