Notice2021-15969
Analysis Regarding Energy Efficiency Improvements in the 2021 International Energy Conservation Code (IECC)
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
July 28, 2021
Issuing agencies
Energy Department
Abstract
The U.S. Department of Energy (DOE) has reviewed the 2021 International Energy Conservation Code (IECC) and determined the updated edition would improve energy efficiency in buildings subject to the code. DOE analysis indicates that buildings meeting the 2021 IECC, as compared with buildings meeting the 2018 IECC, would result in national site energy savings of 9.38 percent, source energy savings of 8.79 percent, and energy cost savings of approximately 8.66 percent of residential building energy consumption. Upon publication of this affirmative determination, each State must certify that it has reviewed the energy efficiency provisions of its residential building code and made a determination whether it is appropriate to revise the code to meet or exceed the updated edition of the IECC. Additionally, this notice provides guidance on State code review processes and associated certifications.
Full Text
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[Federal Register Volume 86, Number 142 (Wednesday, July 28, 2021)]
[Notices]
[Pages 40529-40534]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-15969]
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DEPARTMENT OF ENERGY
[EERE-2021-BT-DET-0010]
Analysis Regarding Energy Efficiency Improvements in the 2021
International Energy Conservation Code (IECC)
AGENCY: Office of Energy Efficiency and Renewable Energy, Department of
Energy.
ACTION: Notice of determination.
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SUMMARY: The U.S. Department of Energy (DOE) has reviewed the 2021
International Energy Conservation Code (IECC) and determined the
updated edition would improve energy efficiency in buildings subject to
the code. DOE analysis indicates that buildings meeting the 2021 IECC,
as compared with buildings meeting the 2018 IECC, would result in
national site energy savings of 9.38 percent, source energy savings of
8.79 percent, and energy cost savings of approximately 8.66 percent of
residential building energy consumption. Upon publication of this
affirmative determination, each State must certify that it has reviewed
the energy efficiency provisions of its residential building code and
made a determination whether it is appropriate to revise the code to
meet or exceed the updated edition of the IECC. Additionally, this
notice provides guidance on State code review processes and associated
certifications.
DATES: Certification statements provided by States shall be submitted
by July 28, 2023.
ADDRESSES: A copy of the supporting analysis, as well as links to the
Federal docket and public comments received, are available at: <a href="https://www.energycodes.gov/development/determinations">https://www.energycodes.gov/development/determinations</a>.
Certification Statements must be addressed to the Building
Technologies Office--Building Energy Codes Program Manager, U.S.
Department of Energy, Office of Energy Efficiency and Renewable Energy,
1000 Independence Avenue SW, EE-5B, Washington, DC 20585.
FOR FURTHER INFORMATION CONTACT: Jeremiah Williams; U.S. Department of
Energy, Office of Energy Efficiency and Renewable Energy, 1000
Independence Avenue SW, EE-5B, Washington, DC 20585; (202) 441-1288;
<a href="/cdn-cgi/l/email-protection#7b311e091e16121a13552c121717121a16083b1e1e551f141e551c140d"><span class="__cf_email__" data-cfemail="c983acbbaca4a0a8a1e79ea0a5a5a0a8a4ba89acace7ada6ace7aea6bf">[email protected]</span></a>.
For legal issues, please contact Matthew Ring; U.S. Department of
Energy, Office of the General Counsel, 1000 Independence Avenue SW, GC-
33, Washington, DC 20585; (202) 586-2555; <a href="/cdn-cgi/l/email-protection#a6ebc7d2d2cec3d188f4cfc8c1e6ced788c2c9c388c1c9d0"><span class="__cf_email__" data-cfemail="3875594c4c505d4f166a51565f785049165c575d165f574e">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
I. Background
II. Public Participation
III. Determination Statement
IV. State Certification
I. Background
Title III of the Energy Conservation and Production Act (ECPA), as
amended, establishes requirements for building energy conservation
standards, which are administered by the DOE Building Energy Codes
Program. (42 U.S.C. 6831 et seq.) Section 304(a), as amended, of ECPA
provides that whenever the 1992 Council of American Building Officials
(CABO) Model Energy Code, or any successor to that code, is revised,
the Secretary of Energy (Secretary) must make a determination, no later
than 12 months after such revision, whether the revised code would
improve energy efficiency in residential buildings, and must publish
notice of such determination in the Federal Register. (42 U.S.C.
6833(a)(5)(A)) If the Secretary determines that the revision of the
CABO Model Energy Code, or any successor thereof, improves the level of
energy efficiency in residential buildings then, not later than two
years after the date of the publication of such affirmative
determination, each State is required to certify that it has reviewed
its residential building code regarding energy efficiency, and made a
determination as to whether it is appropriate to revise its code to
meet or exceed the provisions of the successor code. (42 U.S.C.
6833(a)(5)(B)).
The International Energy Conservation Code (IECC) is the
contemporary successor to the CABO Model Energy Code specified in ECPA.
The IECC is revised every three years through an established code
development and consensus process administered by the International
Code Council (ICC). As part of the ICC process, any interested party
may submit proposals, as well as written comments or suggested changes
to any
[[Page 40530]]
proposal, and make arguments before a committee of experts assembled by
the ICC, with the collection of accepted proposals forming the revised
edition of the IECC. More information on the ICC code development
process is available at <a href="https://www.iccsafe.org/codes-tech-support/codes/code-development-process/code-development-2/">https://www.iccsafe.org/codes-tech-support/codes/code-development-process/code-development-2/</a>.
In addition, on January 20, 2021, the President issued Executive
Order 13990, ``Protecting Public Health and the Environment and
Restoring Science to Tackle the Climate Crisis.'' 86 FR 7037 (Jan. 25,
2021). The Executive Order directed DOE to consider publishing for
notice and comment a proposed rule suspending, revising, or rescinding
the final technical determination regarding the 2018 IECC by May 2021.
Id. at 86 FR 7038. In response, DOE has reviewed the current 2021 IECC
so that DOE's determination under Section 304(b) of ECPA reflects the
most recent version of IECC, and to facilitate State and local adoption
of the 2021 IECC, which will improve energy efficiency in the nation's
residential buildings.
To meet the statutory requirement, and to satisfy the directive
issued under Executive Order 13990, DOE issued a preliminary
determination and published supporting analysis to quantify the
expected energy savings associated with the 2021 IECC relative to the
previous 2018 IECC version. Notice of this preliminary analysis was
published in the Federal Register on May 16, 2021 (86 FR 26710), and is
available at: <a href="https://www.regulations.gov/document/EERE-2021-BT-DET-0010-0001">https://www.regulations.gov/document/EERE-2021-BT-DET-0010-0001</a>.
II. Public Participation
In a May 16, 2021 Federal Register notice, DOE requested public
comments on its preliminary analysis of the 2021 IECC. (86 FR 26710)
DOE received four public comments, all of which DOE considered in
arriving at its final determination. DOE has now issued the final
analysis of the expected energy savings associated with the 2021 IECC
as compared to the 2018 IECC. A summary of public comments received,
and DOE responses, is included in Appendix A of this Notice. The final
analysis is available at: <a href="https://www.energycodes.gov/development/determinations">https://www.energycodes.gov/development/determinations</a>.
III. Determination Statement
Residential buildings meeting the 2021 IECC (compared to the
previous 2018 edition) are expected to incur the following savings on a
weighted national average basis:
<bullet> 9.38 percent site energy savings
<bullet> 8.79 percent source energy savings
<bullet> 8.66 percent energy cost savings
DOE has rendered the conclusion that the 2021 IECC will improve
energy efficiency in residential buildings, and, therefore, receives an
affirmative determination under Section 304(a) of ECPA. States can
experience significant benefits by updating their codes to reflect
current construction standards, a total estimated $74.61 billion in
energy cost savings and 424.20 MMT of avoided CO<INF>2</INF> emissions
in residential buildings (cumulative 2010 through 2040), or $3.24
billion in annual energy cost savings and 18.50 MMT in annual avoided
CO<INF>2</INF> emissions (annually by 2030). These benefits, including
emissions reductions, are estimated in a revised 2021 interim report
addressing building code impacts.\1\ Though not quantified in the
interim report, there may also be costs to regulated entities as a
result of updated residential building codes.
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\1\ See <a href="https://www.pnnl.gov/main/publications/external/technical_reports/PNNL-31437.pdf">https://www.pnnl.gov/main/publications/external/technical_reports/PNNL-31437.pdf</a> for the 2021 interim code impact
report. Financial benefits are calculated by applying historical and
future fuel prices to site energy savings and by discounting future
savings to 2020 dollars. Historical and future real fuel prices are
obtained through EIA's AEO 2015 report (EIA 2015).
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IV. State Certification
Upon publication of this affirmative determination, each State is
required to review the provisions of its residential building code
regarding energy efficiency, and determine whether it is appropriate
for such State to revise its building code to meet or exceed the energy
efficiency provisions of the 2021 IECC. (42 U.S.C. 6833(a)(5)(B)) This
action must be made not later than two years from the date of
publication of a Notice of Determination, unless an extension is
provided.
State Review and Update
The State determination must be: (1) Made after public notice and
hearing; (2) in writing; (3) based upon findings and upon the evidence
presented at the hearing; and (4) made available to the public. (42
U.S.C. 6833(a)(2)) States have discretion with regard to the hearing
procedures they use, subject to providing an adequate opportunity for
members of the public to be heard and to present relevant information.
The Department recommends publication of any notice of public hearing
through appropriate and prominent media outlets, such as in a newspaper
of general circulation. States should also be aware that this
determination does not apply to IECC chapters specific to
nonresidential buildings, as defined in the IECC. Therefore, States
must certify their evaluations of their State building codes for
residential buildings with respect to all provisions of the IECC,
except for those chapters not affecting residential buildings. DOE
determinations regarding earlier editions of the IECC are available on
the DOE Building Energy Codes Program website.\2\ Further national and
State analysis is also available.\3\
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\2\ Available at <a href="https://www.energycodes.gov/regulations/determinations/previous">https://www.energycodes.gov/regulations/determinations/previous</a>.
\3\ Available at <a href="https://www.energycodes.gov/development/residential/iecc_analysis">https://www.energycodes.gov/development/residential/iecc_analysis</a>.
_____________________________________-
State Certification Statements
State certifications are to be sent to the address provided in the
ADDRESSES section, or may be submitted to
<a href="/cdn-cgi/l/email-protection#0c4e7965606865626b4962697e6b754f6368697f4c696922686369226b637a"><span class="__cf_email__" data-cfemail="5210273b3e363b3c35173c3720352b113d3637211237377c363d377c353d24">[email protected]</span></a>, and must be submitted in accordance
with the deadline identified in the DATES section. If a State makes a
determination that it is not appropriate to revise the energy
efficiency provisions of its residential building code, the State must
submit to the Secretary, in writing, the reasons for this
determination, which shall be made available to the public. (42 U.S.C.
6833(a)(4))
The DOE Building Energy Codes Program tracks and reports State code
adoption and certifications.\4\ Once a State has adopted an updated
residential code, DOE typically provides software, training, and
support for the new code, as long as the new code is based on the
national model code (i.e., the 2021 IECC). DOE has issued previous
guidance on how it intends to respond to technical assistance requests
related to implementation resources, such as building energy code
compliance software. (79 FR 15112) DOE is directed to provide incentive
funding to States to implement the requirements of Section 304, and to
improve and implement State residential and commercial building energy
efficiency codes, including increasing and verifying compliance with
such codes. (See 42 U.S.C. 6833(e)) Some States develop their own codes
that are only loosely related to the national model codes, and DOE does
not typically provide technical support for those codes. DOE does not
prescribe how each State adopts and enforces its energy codes.
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\4\ Available at <a href="https://www.energycodes.gov/adoption/states">https://www.energycodes.gov/adoption/states</a>.
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Requests for Extensions
Section 304(c) of ECPA requires that the Secretary permit an
extension of the deadline for complying with the certification
requirements described previously, if a State can demonstrate that it
has made a good faith effort to
[[Page 40531]]
comply with such requirements, and that it has made significant
progress toward meeting its certification obligations. (42 U.S.C.
6833(c)) Such demonstrations could include one or both of the
following: (1) A substantive plan for response to the requirements
stated in Section 304; or (2) a statement that the State has
appropriated or requested funds (within State funding procedures) to
implement a plan that would respond to the requirements of Section 304
of ECPA. This list is not exhaustive. Requests are to be sent to the
address provided in the ADDRESSES section, or may be submitted to
<a href="/cdn-cgi/l/email-protection#5311263a3f373a3d34163d3621342a103c3736201336367d373c367d343c25"><span class="__cf_email__" data-cfemail="307245595c54595e57755e55425749735f5455437055551e545f551e575f46">[email protected]</span></a>.
Appendix A
DOE accepted public comments on the Notice of Preliminary
Determination for the 2021 IECC until June 16, 2021, and received
submissions from a total of 4 commenters. Responsive public comments
and associated DOE answers are described as follows. DOE received
comments on its preliminary determination and supporting analysis of
the 2021 IECC from the following stakeholders:
<bullet> North American Insulation Manufacturers Association (NAIMA)
<bullet> Responsible Energy Code Alliance (RECA)
<bullet> Edison Electric Institute (EEI)
<bullet> Air-Conditioning, Heating and Refrigeration Institute
(AHRI)
The comments are summarized as follows and are available at
<a href="https://www.regulations.gov/document/EERE-2021-BT-DET-0010-0001/comment">https://www.regulations.gov/document/EERE-2021-BT-DET-0010-0001/comment</a>. DOE responded to all comments received. Several issues
raised by commenters are distinct from the energy efficiency
analysis DOE has undertaken pursuant to its statutory obligations.
These include the social cost of carbon, life-cycle cost, and cost
effectiveness; among these issues, social cost of carbon garnered
the most attention from commenters and is therefore emphasized in
the responses below.
North American Insulation Manufacturers Association (NAIMA)
Comment: NAIMA requested that DOE use the updated climate zone
designations in the 2021 IECC and not 2018 IECC. DOE's preliminary
analysis appears to leave out impact of the 2021 IECC climate zone
designations in numerous counties across the United States. This
shortfall could lead to an overestimation of the energy savings
associated with the 2021 IECC.
DOE Response: DOE acknowledges that the residential provisions
of the 2021 IECC incorporate several administrative changes
introduced by the 2013 edition of ASHRAE Standard 169, Climatic Data
for Building Design Standards (ASHRAE 2013a). ASHRAE 169-2013
redefined climate zones and moisture regimes based on recent weather
data. As a result, a number of U.S. counties were reassigned to
different zones/regimes, and a new, extremely hot Climate Zone 0 was
added. (The addition of Climate Zone 0 has no impact on DOE's
analysis, since it does not occur in the U.S.) Approximately 400
U.S. counties out of more than 3,000 were reassigned, most to warmer
climate zones. However, the reassignment of localities is considered
an administrative action, based on long-established definitions of
heating degree days and cooling degree days, and is handled
consistently with how similar climate zone updates have been handled
by previous DOE model energy code determinations. DOE also notes
that the reassignment of climate zones is expected to occur in the
future, based on updated weather and climate data, and associated
updates to ASHRAE Standard 169.
Comment: NAIMA requested that DOE produce the equivalent cost-
effectiveness document for the 2021 IECC as rapidly as possible
after the publication of the final 2021 IECC determination.
Additionally, NAIMA requested that DOE perform this analysis with a
variety of down payment amounts to show cost-effectiveness with
typical range of loans--a 0% down loan, a 10% down loan, and a 20%
down loan.
DOE Response: In making its determination, DOE's directive under
ECPA is to assess whether updated editions of the 2021 IECC would
improve energy efficiency in residential buildings. Concepts such as
life-cycle cost and cost effectiveness represent economic analysis
and are therefore unique from energy efficiency analysis. However,
DOE recognizes the value of such analysis in informing State and
local decisions surrounding code review and update processes, as
well as design decisions associated with specific buildings and
systems. Distinct from its determination directive under ECPA, DOE
provides a variety of additional analysis, including cost-
effectiveness analysis. The established DOE methodology is currently
designed around a single typical home mortgage scenario, and not
multiple down payment scenarios, as requested by NAIMA. However, DOE
will consider expanding its analysis in the future to further study
a range of financing scenarios, including those experienced by low
and moderate income (LMI) households.
Responsible Energy Codes Alliance (RECA)
Comment: RECA's first comment recommended that the DOE take
actions to encourage, and provide additional support for, States and
cities to adopt and implement the 2021 IECC in the months and years
ahead.
DOE response: DOE is directed under ECPA to provide technical
assistance supporting the implementation of building energy codes.
Consistent with this directive, DOE intends to continue providing
robust technical assistance supporting State and local
implementation of buildings energy codes. DOE recognizes the
importance of supporting the States and local governments who
ultimately adopt and implement codes, as well as the wide range of
industry stakeholders who rely upon energy codes and strive to
achieve compliance in practice.
Comment: RECA's second comment stated that RECA agrees with and
supports the methodology and conclusion in the preliminary analysis.
DOE response: DOE appreciates the support.
Comment: RECA's third comment recommended that DOE should
implement the 2021 IECC into REScheck.
DOE response: DOE intends to support the implementation of the
2021 IECC into REScheck in the future.
Comment: RECA's fourth comment recommended that DOE remove pre-
2015 IECC versions from REScheck.
DOE response: In maintaining its compliance resources, such as
the REScheck software \5\, DOE typically supports the three most
recent editions of the model codes. (79 FR 15112) Following the
current determination, this is anticipated to include the 2021, 2018
and 2015 editions of the IECC. DOE intends to maintain consistency
with this approach.
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\5\ REScheck is a software tool developed and maintained by DOE
for the purpose of verifying compliance in residential buildings.
See <a href="https://www.energycodes.gov/rescheck">https://www.energycodes.gov/rescheck</a>.
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Comment: RECA's fifth comment recommended that DOE provide cost-
effectiveness analysis.
DOE response: As outlined in previous responses, DOE notes that
the current determination is focused on whether the 2021 IECC would
improve energy efficiency in residential buildings. However, DOE
recognizes the value of additional forms of technical analysis
supporting building energy codes, and intends to continue to provide
both national and State-level cost-effectiveness analysis of the
2021 IECC in the future.
Comment: RECA's sixth comment recommended that DOE provide
State-level energy and cost analyses.
DOE response: Consistent with the previous comment response, DOE
intends to provide State-level energy and cost analyses in the
future.
Comment: RECA's seventh comment recommended that DOE provide
implementation support for the 2021 IECC.
DOE response: Consistent with previous comment responses, DOE
intends to continue providing robust support for States and local
governments implementing building energy codes. DOE intends to
provide additional resources supporting the 2021 IECC implementation
in the future.
Edison Electric Institute (EEI)
Comment: EEI's first comment stated that the EPA greenhouse gas
equivalencies calculator overstates the emissions impact.
DOE response: As outlined in previous responses, DOE notes that
the current determination is focused solely on whether the revised
Standard would improve energy efficiency in residential buildings,
and CO<INF>2</INF> savings were not considered as part of DOE's
ultimate determination of whether the revised Standard will improve
energy efficiency. DOE is reporting estimated CO<INF>2</INF> savings
only because it recognizes the value of additional forms of
technical analysis supporting State implementation of building
energy codes, including emissions analyses. DOE relies on greenhouse
gas emission coefficients established by the Environmental
Protection Agency (EPA) in estimating current year CO<INF>2</INF>
savings. EPA's emission coefficients are designed to reflect
marginal
[[Page 40532]]
CO<INF>2</INF> savings from electricity savings occurring on the
building site, which DOE considers appropriate for estimating and
communicating the carbon savings stemming from an improved energy
code. This approach is consistent with how DOE has performed similar
calculations in previous determinations.
Comment: EEI's second comment recommended that DOE's
determination should take into account the commitments utilities
have made to reduce carbon emissions.
DOE response: As outlined in previous responses, DOE notes that
the current determination is focused solely on whether the revised
Standard would improve energy efficiency in residential buildings,
and CO<INF>2</INF> savings were not considered as part of DOE's
ultimate determination of whether the revised Standard will improve
energy efficiency. DOE is reporting estimated CO<INF>2</INF> savings
only because it recognizes the value of additional forms of
technical analysis supporting State implementation of building
energy codes, including emissions analyses. DOE's analysis is based
on several metrics; energy cost, site energy, and source energy. In
addition, DOE reports carbon emissions on a first-year basis. DOE
recognizes the progress being made by utilities in decarbonizing the
electric grid, and emphasizes that estimates provided in the
supporting technical analysis are based on current emission levels
and are subject to change in the future.
Air-Conditioning, Heating, and Refrigeration Institute (AHRI)
Comment: AHRI, p. 2-5. AHRI commented that historically DOE did
not estimate emission reductions or apply a value to emission
reductions as part of the results and basis for the determination.
They further stated that including emission reductions or their
value, including the SC-CO<INF>2,</INF> as part of the basis for
determination was outside DOE's authority to consider (42 U.S.C.
6833(a)(5)), because EPCA is an energy conservation statute and
excludes environmental objectives (see 42 U.S.C. 6312 which excludes
environmental objectives), and that DOE does not have the statutory
authority to consider greenhouse gas estimates in determination of
residential building codes. AHRI opined that the SC-CO<INF>2</INF>
should only be included for rulemakings where DOE has clear
statutory authority to do so and stated that it lacks such statutory
authority as to building energy codes.
DOE response: In making its determination, DOE's directive under
ECPA is to assess whether updated editions of the IECC would improve
energy efficiency in residential buildings. 42 U.S.C. 6833(b)(2)(A)
DOE emphasizes that the estimates pertaining to CO<INF>2</INF> are
provided as supplemental information only and were not considered as
part of DOE's final determination, which is based on energy
efficiency as required under 42 U.S.C. 6833(5)(A). Climate benefits
associated with the expected CO<INF>2</INF> emissions reductions are
monetized using estimates of the social cost of carbon presented in
the Technical Support Document: Social Cost of Carbon, Methane, and
Nitrous Oxide Interim Estimates under Executive Order 13990 (IWG
2021). DOE is reporting estimates related to CO<INF>2</INF> only
because information on the carbon emissions associated with
buildings are valued by many stakeholders, including States and
local governments who ultimately implement building codes, and who
have expressed a need for this information. These estimates are not
considered as part of DOE's ultimate determination of whether the
updated IECC will improve energy efficiency.
Comment: AHRI, p. 2, 5. AHRI stated that DOE is ignoring clear
congressional intent in including emissions in the narrowly scoped
building energy code review defined in the statutory text (42 U.S.C.
6833(b)(1)). AHRI further stated that congress could have added
global climate change into a variable to weigh in the determination,
but did not do so and so DOE should not include this in the
determination.
DOE Response: See response to previous AHRI comment.
Comment: AHRI, p. 2. AHRI requested that DOE remove carbon
emissions from the determination for building energy codes,
including the 2021 IECC.
DOE Response: See response to previous AHRI comment.
Comment: AHRI p. 2. Irrespective of the authority consideration,
AHRI requested that DOE must act to remedy inaccurate assumptions
and conclusions on the social cost of carbon benefits analysis. AHRI
opined that the benefits claimed from full fuel cycle and global
impact of emissions and SC-CO<INF>2</INF> are speculative and
tangential and that these are calculated over a time period (100
years) that greatly exceeds that used to measure economic costs.
DOE Response: In making its determination, DOE's directive under
ECPA is to assess whether updated editions of the IECC would improve
energy efficiency in residential buildings. 42 U.S.C. 6833(b)(2)(A)
DOE emphasizes that the estimates pertaining to CO<INF>2</INF> are
provided only as supplemental information and are not considered as
part of the final determination, which is based on energy efficiency
as required under 42 U.S.C. 6833(b)(2)(A).
In calculating related CO<INF>2</INF> impacts, DOE used the
estimates for the SC-CO<INF>2</INF> from the most recent update of
the Interagency Working Group on Social Cost of Greenhouse Gases,
United States Government (IWG), from ``Technical Support Document:
Social Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates
under Executive Order 13990.'' (February 2021 TSD). DOE has
determined that the estimates from the February 2021 TSD, as
described more below, are based upon sound analysis and provide well
founded estimates for DOE's analysis of the impacts of
CO<INF>2</INF> related to the reductions of emissions from updating
the IECC to the 2021 edition.
These SC-CO<INF>2</INF> estimates are interim values developed
under Executive Order (E.O.) 13990 for use until an improved
estimate of the impacts of climate change can be developed based on
the best available science and economics. The SC-CO<INF>2</INF>
estimates used in this analysis were developed over many years,
using a transparent process, peer-reviewed methodologies, the best
science available at the time of that process, and with input from
the public. Specifically, an interagency working group (IWG) that
included the EPA and other executive branch agencies and offices
used three integrated assessment models (IAMs) to develop the SC-
CO<INF>2</INF> estimates and recommended four global values for use
in regulatory analyses. The SC-CO<INF>2</INF> estimates were first
released in February 2010 and updated in 2013 using new versions of
each IAM. In 2015, as part of the response to public comments
received to a 2013 solicitation for comments on the SC-
CO<INF>2</INF> estimates, the IWG announced a National Academies of
Sciences, Engineering, and Medicine review of the SC-CO<INF>2</INF>
estimates to offer advice on how to approach future updates to
ensure that the estimates continue to reflect the best available
science and methodologies. In January 2017, the National Academies
released their final report, Valuing Climate Damages: Updating
Estimation of the Social Cost of Carbon Dioxide, and recommended
specific criteria for future updates to the SC-CO<INF>2</INF>
estimates, a modeling framework to satisfy the specified criteria,
and both near-term updates and longer term research needs pertaining
to various components of the estimation process (National Academies
2017). On January 20, 2021, President Biden issued Executive Order
13990, which directed the IWG to ensure that the U.S. Government's
(USG) estimates of the social cost of carbon and other greenhouse
gases reflect the best available science and the recommendations of
the National Academies (2017). The IWG was tasked with first
reviewing the estimates currently used by the USG and publishing
interim estimates within 30 days of E.O. 13990 that reflect the full
impact of GHG emissions, including taking global damages into
account.\6\ The interim SC-CO<INF>2</INF> estimates published in
February 2021 are used here to estimate the climate benefits
associated with this determination.
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\6\ The E.O. instructs the IWG to undertake a fuller update of
the SC-GHG estimates by January 2022.
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DOE acknowledges that there are a number of challenges in
attempting to assess the incremental economic impacts of
CO<INF>2</INF> emissions. The science and economic understanding of
climate change and its impacts is improving over time; research
focused on the assessment of climate damages and socioeconomic
emissions projections is particularly important for reducing
uncertainty in the calculation of the social cost of greenhouse
gases (SC-GHG),\7\
[[Page 40533]]
as is quantifying and being transparent about where key
uncertainties in the models remain. But contrary to AHRI's
suggestion that uncertainty should cause DOE to discount or abandon
monetization of the social benefits of reducing CO<INF>2</INF>
emissions, as IWG has stated, due to a number of sources of
uncertainty, there is a likelihood that the SC-CO<INF>2</INF> is an
underestimate of the true social cost of emissions.\8\ Despite the
limits of both quantification and monetization, SC-CO<INF>2</INF>
estimates can be useful in estimating the social benefits of
reducing CO<INF>2</INF> emissions. As a result, DOE has used the
IWG's SC-CO<INF>2</INF> estimates in monetizing the social benefits
of reducing CO<INF>2</INF> emissions. However, as discussed in
previous comments, DOE's SC-CO<INF>2</INF> analysis using these
estimates was not considered in DOE's ultimate determination of
whether the 2021 IECC Standard will improve energy efficiency.
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\7\ The social cost of greenhouse gases (SC-GHG) is the monetary
value of the net harm to society associated with adding a small
amount of that GHG to the atmosphere in a given year and, therefore,
should reflect the societal value of reducing emissions of the gas
in question by one metric ton. The marginal estimate of social costs
will differ by the type of greenhouse gas (such as carbon dioxide,
methane, and nitrous oxide) and by the year in which the emissions
change occurs. The estimates of the social cost of carbon (SC-
CO<INF>2</INF>), social cost of methane (SC-CH<INF>4</INF>), and
social cost of nitrous oxide (SC-N<INF>2</INF>O) published in the
February 2021 TSD allow agencies to understand the social benefits
of reducing emissions of each of these greenhouse gases, or the
social costs of increasing such emissions, in the policy making
process. Collectively, these values are referenced as the ``social
cost of greenhouse gases'' (SC-GHG).
\8\ See Interagency Working Group on Social Cost of Greenhouse
Gases, Technical Support Document: Social Cost of Carbon, Methane,
and Nitrous Oxide. Interim Estimates Under Executive Order 13990,
Washington, DC, February 2021.
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Comment: AHRI p. 2,3. As part of the rationale for not including
SC-CO<INF>2,</INF> AHRI further commented that DOE has acknowledged
the uncertainty of SC-CO<INF>2</INF> estimates and stated that these
are both provisional and revisable. Further, they noted that the
interagency working group developing the SC-CO<INF>2</INF> noted
that the underlying models were imperfect and incomplete and notes
that the intergovernmental panel on climate change (IPCC) which the
IWG relied on also stated in 2013 that no best estimate for
equilibrium climate sensitivity could then be given because of the
lack of agreement on values across assessed lines of evidence and
studies.
DOE Response: In making its determination, DOE's directive under
ECPA is to assess whether updated editions of the IECC would improve
energy efficiency in residential buildings. 42 U.S.C. 6833(b)(2)(A)
DOE emphasizes that the estimates pertaining to CO<INF>2</INF> are
provided only as supplemental information and are not considered as
part of the final determination, which is based on energy efficiency
as required under 42 U.S.C. 6833(b)(2)(A).
As noted above, DOE determined that the estimates from the
February 2021 TSD are based upon sound analysis and provide well
founded estimates for DOE's analysis of the impacts of
CO<INF>2</INF> related to the reductions of emissions from updating
the 90.1 Standard to the 2019 edition. As explained in the February
2021 TSD and while the IWG works to assess how best to incorporate
the latest, peer reviewed science to develop an updated set of SC-
GHG estimates, the IWG has determined that it is appropriate for
agencies to revert to the same set of four values drawn from the SC-
GHG distributions based on three discount rates as were used in
regulatory analyses between 2010 and 2016 and subject to public
comment. For each discount rate, the IWG combined the distributions
across models and socioeconomic emissions scenarios (applying equal
weight to each) and then selected a set of four values for use in
benefit-cost analyses: An average value resulting from the model
runs for each of three discount rates (2.5%, 3%, and 5%), plus a
fourth value, selected as the 95th percentile of estimates based on
a 3 percent discount rate. The fourth value was included to provide
information on potentially higher-than-expected economic impacts
from climate change, conditional on the 3% estimate of the discount
rate. As explained in the February 2021 TSD, this update reflects
the immediate need to have an operational SC-GHG for use in
regulatory benefit-cost analyses and other applications that was
developed using a transparent process, peer-reviewed methodologies,
and the science available at the time of that process. Those
estimates were subject to public comment in the context of dozens of
proposed rulemakings as well as in a dedicated public comment period
in 2013. However, as discussed in previous comments, DOE's SC-
CO<INF>2</INF> analysis using these estimates was not considered in
DOE's ultimate determination of whether the 2021 IECC Standard will
improve energy efficiency.
Comment: AHRI, p. 3,5. AHRI commented that EPCA's focus is on
benefits accruing with this nation, hence incorporation of SC-
CO<INF>2</INF> at the global level is beyond the scope and authority
of DOE. See 42 U.S.C. 6833(a)(1-5). They further noted that EPCA
originally arose out of the 1970's oil embargo and that nothing in
the subsequent amendments suggests a different statutory focus other
than improving the energy economic within the United States. AHRI
notes that DOE analyzes expected national [domestic] energy savings,
but does not scale back reported SC-CO<INF>2</INF> calculations to
reflect domestic impacts only.
DOE Response: In making its determination, DOE's directive under
ECPA is to assess whether updated editions of the IECC would improve
energy efficiency in residential buildings. 42 U.S.C. 6833(b)(2)(A)
DOE emphasizes that the estimates pertaining to CO<INF>2</INF> are
provided only as supplemental information and are not considered as
part of the final determination, which is based on energy efficiency
as required under 42 U.S.C. 6833(b)(2)(A).
As to the use of a SC-CO<INF>2</INF> value that includes impacts
outside the boundaries of the United States, the February 2021 TSD
provides a complete discussion of the IWG's initial review conducted
under E.O. 13990. In particular, the IWG found that a global
perspective is essential for SC-GHG estimates because climate
impacts occurring outside U.S. borders can directly (and indirectly
affect the welfare of U.S. citizens and residents. Thus, U.S.
interests are affected by the climate impacts that occur outside
U.S. borders. Examples of affected interests include: Direct effects
on U.S. citizens and assets located abroad, international trade, and
tourism, and spillover pathways such as economic and political
destabilization and global migration. In addition, assessing the
benefits of U.S. GHG mitigation activities requires consideration of
how those actions may affect mitigation activities by other
countries, as those international mitigation actions will provide a
benefit to U.S. citizens and residents by mitigating climate impacts
that affect U.S. citizens and residents. Therefore, in this analysis
DOE centers attention on a global measure of SC-GHG.
As noted above, DOE determined that the estimates from the
February 2021 TSD are based upon sound analysis, and therefore, in
analyzing the impacts of CO<INF>2</INF> related to the reductions of
emissions from updating the 90.1 Standard to the 2019 edition, DOE
has focused on a global measure of SC-CO<INF>2</INF>. As noted in
the February 2021 TSD, the IWG will continue to review developments
in the literature, including more robust methodologies for
estimating SC-GHG values based on purely domestic damages, and
explore ways to better inform the public of the full range of carbon
impacts, both global and domestic. As a member of the IWG, DOE will
likewise continue to follow developments in the literature
pertaining to this issue. However, as discussed in previous
comments, DOE's SC-CO<INF>2</INF> analysis using these estimates was
not considered in DOE's ultimate determination of whether the 2021
IECC Standard will improve energy efficiency.
Comment: AHRI, p.3,4. AHRI stated that DOE wrongly assumes that
SC-CO2 values increase over time in real dollars and states that
this is contrary to ``historical experience and to economic
development science'' and that the more economic development that
occurs, the more adaptation and mitigation efforts a population
living in a growing economy can afford to undertake (AHRI cites the
IWG indicating that developed countries can eliminate 90% of the
economic impacts and developing countries could eventually eliminate
50% of the economic impacts of climate change). They comment that
they see no indication that DOE considered this separately.
DOE Response: In making its determination, DOE's directive under
ECPA is to assess whether updated editions of Standard 90.1 would
improve energy efficiency in commercial buildings. 42 U.S.C.
6833(b)(2)(A) DOE emphasizes that the estimates pertaining to
CO<INF>2</INF> are provided only as supplemental information and are
not considered as part of the final determination, which is based on
energy efficiency as required under 42 U.S.C. 6833(b)(2)(A).
The model scenarios reported by the IWG demonstrate that the
damage assessments and corresponding valuation (SC-CO<INF>2</INF>),
adjusted for inflation, increase through time. As explained in the
February 2021 TSD, ``[t]he SC-[CO<INF>2</INF>] estimates increase
over time within the models--i.e., the societal harm from one metric
ton emitted in 2030 is higher than the harm caused by one metric ton
emitted in 2025--because future emissions produce larger incremental
damages as physical and economic systems become more stressed in
response to greater climatic change, and because GDP is growing over
time and many damage categories are modeled as proportional to GDP.
As noted above, DOE determined that the estimates from the February
2021 TSD are based upon sound analysis and provide well founded
estimates for DOE's analysis of the impacts of CO<INF>2</INF>
related to the reductions of emissions
[[Page 40534]]
from updating the 90.1 Standard to the 2019 edition in its building
codes impact analysis. Accordingly, DOE incorporated the IWG's
consideration in its analysis. However, as discussed in previous
comments, DOE's SC-CO<INF>2</INF> analysis using these estimates was
not considered in DOE's ultimate determination of whether the 2021
IECC Standard will improve energy efficiency.
Comment: AHRI, p. 4. AHRI argued that it is arbitrary and
capricious to use different timeframes and assumptions for costs and
benefits and notes that DOE must clarify precisely why and how it
believes it has statutory authority under 42 U.S.C. 6833(a) to
consider SC-CO<INF>2</INF> issues and cites why such action is
legally arbitrary without sufficient documented reason for treating
similar situations differently. AHRI notes that DOE, in clarifying
why it believes it has such authority, can establish how it is
acting consistently in terms of the analysis of benefits.
DOE Response: See previous response to AHRI comment on the issue
of authority. On the issue of costs and benefits, DOE reemphasizes
that its determination analysis is not assessing the costs and
benefits associated with the updated 2021 IECC, that the
determination is solely based on energy efficiency, and that the
reported carbon emissions are reported only as supplemental
information for the benefit of interested parties and in support of
the directives of Executive Order 12866. To clarify the issue of
timeframe, the emission estimates are based on one year (i.e., the
annual energy consumption estimated via the energy efficiency
analysis). However, the step of projecting the associated
CO<INF>2</INF> impacts captures the longer-term impact of those
single-year emissions, as they persist in the atmosphere (and drive
the damage impacts over the time they persist), which is then
discounted to present value for the year when the emissions occur.
DOE does not find an economic inconsistency in this approach to
reporting emission benefits. Such a calculation is similar to life-
cycle analysis, for instance, which is performed in a similar
fashion, where a single year event occurs (e.g., a purchase of more
efficient equipment), but the energy savings are calculated over the
time they exist (e.g., the life of the equipment), and discounted
back to the present value to reflect an overall life-cycle cost.
DOE's reporting here of discounted damage impacts is consistent with
that general approach.
Signing Authority
This document of the Department of Energy was signed on July 19,
2021, by Kelly Speakes-Backman, Principal Deputy Assistant Secretary
and Acting Assistant Secretary for Energy Efficiency and Renewable
Energy, pursuant to delegated authority from the Secretary of Energy.
That document with the original signature and date is maintained by
DOE. For administrative purposes only, and in compliance with
requirements of the Office of the Federal Register, the undersigned DOE
Federal Register Liaison Officer has been authorized to sign and submit
the document in electronic format for publication, as an official
document of the Department of Energy. This administrative process in no
way alters the legal effect of this document upon publication in the
Federal Register.
Signed in Washington, DC, on July 22, 2021.
Treena V. Garrett,
Federal Register Liaison Officer, U.S. Department of Energy.
[FR Doc. 2021-15969 Filed 7-27-21; 8:45 am]
BILLING CODE 6450-01-P
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