The Climate Leadership and Community Protection Act (Climate Act) has a legal mandate for New York State greenhouse gas emissions to meet the ambitious net-zero goal by 2050. A couple of pieces of legislation are being considered to implement parts of the transition plan. This post summarizes the Advanced Building Codes, Appliance and Equipment Efficiency Standards Act (Advanced Code Act) and the Gas Transition and Affordable Energy Act (Gas Ban).
Everyone wants to do right by the environment to the extent that they can afford to and not be unduly burdened by the effects of environmental policies. I have written extensively on implementation of New York’s response to climate change risk because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that it will adversely affect reliability, impact affordability, risk safety, affect lifestyles, and will have worse impacts on the environment than the purported effects of climate change in New York. New York’s Greenhouse Gas (GHG) emissions are less than one half one percent of global emissions and since 1990 global GHG emissions have increased by more than one half a percent per year. Moreover, the reductions cannot measurably affect global warming when implemented. The opinions expressed in this post do not reflect the position of any of my previous employers or any other company I have been associated with, these comments are mine alone.
Climate Act Background
The Climate Act establishes a “Net Zero” target by 2050. The Climate Action Council is responsible for preparing the Scoping Plan that will “achieve the State’s bold clean energy and climate agenda”. They were assisted by Advisory Panels who developed and presented strategies to the meet the goals to the Council. Those strategies were used to develop the integration analysis prepared by the New York State Energy Research and Development Authority (NYSERDA) and its consultants that quantified the impact of the strategies. That analysis was used to develop the Draft Scoping Plan that was released for public comment on December 30, 2021.
Two bills address the building sector components that need to be changed for the net-zero transition. According to the Advanced Code Act: “Buildings are the single largest user of energy in the State of New York, accounting for almost 60% of all energy consumed by end-use in the State.” Revisions to building codes will be “directly impacting a building’s energy load and carbon footprint”. The Gas Ban notes that the Climate Act “requires greenhouse gas emission reductions from all sectors, which will entail, among other things, converting buildings throughout the state from heating and cooking with combustible fuels to heating and cooking with non-emitting sources such as energy-efficient air, ground, and water sourced electric heat pumps which also provide cooling, and electric and induction stoves”.
Cart Before the Horse
The authors of the Climate Act and most of the Climate Action Council believe that the transition to net-zero is simply a matter of political will. The Act did not explicitly mandate a feasibility analysis and the Council has not mentioned anything in its deliberations. However, I believe that the Climate Action emission reduction targets are contingent upon meeting Public Service (PBS) CHAPTER 48, ARTICLE 4, § 66-p. Establishment of a renewable energy program (4): “The commission may temporarily suspend or modify the obligations under such program provided that the commission, after conducting a hearing as provided in section twenty of this chapter, makes a finding that the program impedes the provision of safe and adequate electric service; the program is likely to impair existing obligations and agreements; and/or that there is a significant increase in arrears or service disconnections that the commission determines is related to the program”.
Both of these bills suffer from the same under-estimation of the challenges of a net-zero transition. Until the New York has proven that the Scoping Plan will not impede the conditions described above, I think it is premature to change building codes and energy efficiency standards or implement a ban on fossil-fuel use.
Advanced Building Codes, Appliance and Equipment Efficiency Standards Act
The Senate version (S. 7176) is available here and Assembly version (A. 08143) here. Note that I am not trying to reconcile any differences between the Senate and Assembly versions in this post. The impetus of this legislation is to support the Climate Act and I believe revised building codes are necessary to improve building shells for electrified residential heating. Section 3.3 Sectoral Results -Buildings in Appendix G, Integration Analysis Technical Supplement Section I is the primary reference for technical information related to the building sector in the Draft Scoping Plan. It describes the building shell improvements as follows:
Building shell improvements (such as improved insulation, window treatments, or deep home retrofits) are modeled as reducing service demand for HVAC devices. Improvements to buildings incur costs but improve home and office comfort in addition to reducing energy bills. Two bundles of building shell improvements have been included: a basic shell upgrade and a deep shell upgrade. Basic and deep shell upgrades include a variety of measures focused on reducing energy use and increasing occupant comfort; these measures include, for example, varying levels of roof and wall insulation improvements, window treatments such as double or triple paned windows and infiltration improvements. Space heating demands are reduced by 27-44% with the basic shell package and 57-90% with the deep shell package, depending on building type. Air conditioning demands are reduced 14-27% with the basic shell package and 9-57% with the deep shell package. The total impact of building shell improvements on total HVAC service demand in buildings is a function of the market penetration of each package and distribution of building types. Building shell improvements include both retrofits and new construction, although all new construction in residential and commercial is assumed to be code-compliant and therefore has lower HVAC service demands relative to the existing building stock. (Footnote for this sentence said “E3 calculated the stock rollover of building shells with a 20-year lifetime to reflect improvements in new construction and opportunities for home retrofits.”
There is no reference to building shells in the Advanced Code Act. Amended Section 2 (a) reads:
The state fire prevention and building code council is authorized, from time to time as it deems appropriate and consistent with the purposes of this article, to review and amend the code, or adopt a new code, through rules and regulations provided that the code remains cost effective with respect to building construction in the state. In determining whether the code remains cost effective, the code council shall consider:
(i) whether the life-cycle costs for a building will be recovered through savings in energy costs over the design life of the building under a life-cycle cost analysis performed under methodology as established by the New York State Energy Research and Development Authority in regulations which may be updated from time to time, and
(ii) secondary or societal effects, such as reductions in greenhouse gas emissions, as defined in regulations. Before publication of a notice of proposed rule making establishing the methodology or defining secondary or societal effects, the president of the authority shall conduct public meetings to provide meaningful opportunities for public comment from all segments of the population that would be impacted by the regulations, including persons living in disadvantaged communities as identified by the climate justice working group established under section 75-0111 of the environmental conservation law.
For residential buildings, the code shall meet or exceed the then most recently published International Energy Conservation Code, or achieve equivalent or greater energy savings; and for commercial buildings, the code shall meet or exceed the then most recently published ASHRAE 90.1, or achieve equivalent or greater energy savings.
The biggest question I have is whether the revised codes are consistent with the Draft Scoping Plan building shell requirements. If so, what level? For a single-family residence the Draft Scoping Plan estimates that a basic shell upgrade will cost $6,409 but a deep shell upgrade is expected to cost $45,136. As you can see this makes a huge difference in the costs.
A few other points. Note that cost effectiveness test includes “secondary or societal effects, such as reductions in greenhouse gas emissions, as defined in regulations”. New York mistakenly multiplies its social cost of carbon rates by the avoided carbon emissions for every year over the lifetime of a project. The social cost of carbon metric estimates the value of a ton of carbon reduced on societal benefits of reduced sea-level rise, reduced diseases, etc. impacts of climate change out to 2300. Clearly counting this for every year of the lifetime of a project over estimates the benefits.
One concern of mine is that there are many old buildings that cannot be upgraded to modern building shell standards. The bill does acknowledge that this is an issue. However, the exemption is limited to historic buildings related to the national register. That is an issue because there are many old houses that cannot be upgraded easily and cheaply that are not “historic”. In addition, some homeowners don’t want to register their homes because of restrictions on what they can do with their homes.
Gas Transition and Affordable Energy Act
The Assembly version (A 9329) is available here. In brief, this bill: “Aligns utility regulation with state climate justice and emission reduction targets; repeals provisions relating to continuation of gas service; repeals provisions relating to the sale of indigenous natural gas for generation of electricity.” A primary focus of the Draft Scoping Plan is to transition off of natural gas. It has become such a hot button issue on the Climate Action Council that the semantics of labeling natural gas as fossil gas has been a topic of heated debate.
The first goal of the bill is to align utility regulation with state climate justice and emission reduction targets. The climate justice target requires the state to “invest or direct resources in a manner designed to ensure that disadvantaged communities to receive at least 35 percent, with the goal of 40 percent, of overall benefits of spending on: clean energy and energy efficiency programs and projects or investments in the areas of housing, workforce development, pollution reduction, low-income energy assistance, energy, transportation, and economic development.” The emission reduction targets require New York to reduce economy-wide greenhouse gas emissions 40 percent by 2030 and no less than 85 percent by 2050 from 1990 levels.
The bill states:
After such plan is established, the commission or other relevant governing authority shall take any such action, after notice and a hearing, as is necessary to facilitate the achievement of the climate justice and emission reduction targets in article seventy-five of the environmental conservation law, but in doing so it shall actively encourage a transition away from combustible fuels and ensure that all residential customers have access to electric heating and cooling services without unreasonable qualifications, unreasonable costs, or lengthy delays with a goal that low-to-moderate income customers, defined as households with annual incomes at or below eighty percent of the area median income of the county or metro area where they reside, are adequately protected from bearing energy burdens greater than six percent of their income, including any undue burdens imposed by the cost to purchase and operate electric equipment needed to facilitate the termination of gas service.
It seems obvious to me that the bill should be written such that the first step is an analysis to determine if this is feasible. If it is not then implementation will only exacerbate the energy burden problem. It is disappointing to me that the environmental justice community has not addressed this aspect of the situation. As much as they all want to do something about climate change the fact is that ill-considered legislation and regulation can cause more harm than good.
The bill also repeals provisions relating to continuation of gas service. In order to make the net-zero transition someday, somewhere the State is going to have to force people off their gas appliances. The details how this will be accomplished are not made clear.
Finally, the bill repeals provisions relating to the sale of indigenous natural gas for generation of electricity. There are special provisions in current law that relate to an electric generating facility that has its own supply of natural gas. New York’s irrational war on natural gas precludes the use of the massive shale gas deposits underneath much of the state so this is a moot point.
The bill acknowledges that affordability is an issue. It states that:
Over two and a half million households in New York struggle to pay their heating bills. The Public Service Commission has declared, but not yet achieved the goal that customers should not pay more than 6% of their income for utility energy services, a number based on a nationally accepted standard.
Unfortunately, the bill sponsors do not state where the state stands relative to the standard and how the bill could affect it. Great Britain has similar net-zero transitions but is further along implementing the programs necessary to meet the goals. According to a recent article, “Britain’s cost-of-living squeeze is starting to bite into the spending power of most parts of the country, with 43% of those who pay energy bills saying they will struggle with the costs”. The article explains that “The findings underscore the scale of the hit to consumers from a jump in electricity and natural gas prices that has pushed up inflation across the economy to a 30-year high.” It is not clear how New York can avoid the same outcome.
The biggest question is how much will this cost? There are 5,889,200 residences that currently use natural gas. Conversion to heat pumps will not save them money so they will never save enough money to pay off the heat pump conversion costs.
Finally, there is no acknowledgement that an all-electric energy system is not resilient. The Council has been silent on a plan for the inevitable ice storm or heavy snow event. It is bad enough that the fragile transmission system creates health and safety issues when everything possible is electrified. The Climate Act goes even further. The current electric generating system that has taken decades to develop into the reliable and affordable system that exists today. The Council has not acknowledged that transitioning from a system dependent upon dispatchable generating resources to one dependent upon non-dispatchable wind and solar resources in less than 20 years carries enormous risks to reliability. In February 2021, the Texas electric grid failed when needed most. Russell Gold’s article “One year after the deadly blackout, officials have done little to prevent the next one—which could be far worse” does an excellent job describing what happened. He explains that as the frigid air behind the winter storm blanketed the state and the electric gird, operators started dealing with problems:
Nobody yet knew just how widespread the blackouts would become—that they would spread across almost the entire state, leave an unprecedented 11 million Texans freezing in the dark for as long as three days, and result in as many as seven hundred deaths. But neither could the governor, legislators, and regulators who are supposed to oversee the state’s electric grid claim to be surprised. They had been warned repeatedly, by experts and by previous calamities—including a major blackout in 2011—that the grid was uniquely vulnerable to cold weather.
These bills are sneaking through under the radar of most New Yorkers. They will be expensive, limit personal choice, and risk health and safety because limiting energy use to one source is not a resilient approach. I have not been able to find out how New York stands relative to the energy affordability policy goal that customers should not pay more than 6% of their income for utility energy services. Shouldn’t there be a state-wide goal for the percentage of customers that don’t meet that target and shouldn’t bills that will affect that target include a contingency to not exacerbate that metric? Given that New York’s emissions in context with the rest of the world are less than one half of one percent of total global emissions and that those emissions are increasing by more than one half of one percent per year, it does not seem appropriate to increase energy poverty in the state for emission reductions that will be displaced in a year.