Agenda packet, special meeting — Glendale City Council, June 14, 2022 (part 6 of 9)

GAS SUPPLY TAKEN
California Source Gas
13 Regular Purchases 1.1 1.1 1.1 1.1 13
14 Received for Exchange/Transport 0.0 0.0 0.0 0.0 14
15 Total California Source Gas 1.1 1.1 1.1 1.1 15
16 Purchases from Other Utilities 0.0 0.0 0.0 0.0 16
Out-of-State Gas
17 Pacific Interstate Companies 0.0 0.0 0.0 0.0 17
18 Additional Core Supplies 0.0 0.0 0.0 0.0 18
19 Incremental Supplies 25.2 25.2 25.2 25.2 19
20 Out-of-State Transport 0.0 0.0 0.0 0.0 20
21 Total Out-of-State Gas 25.2 25.2 25.2 25.2 21
22 22 Subtotal 26.3 26.3 26.3 26.3
23 23 Underground Storage Withdrawal 0.0 0.0 0.0 0.0
24 24 TOTAL Gas Supply Taken & Transported 26.3 26.3 26.3 26.3 1532 of 2287

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TABLE 39 – CITY OF LONG BEACH-ENERGY RESOURCES DEPARTMENT : TABLE 1A-LB ANNUAL GAS SUPPLY AND SENDOUT – MMcf/d
AVERAGE YEAR FORECAST FOR THE 2020 CGR REPORT
TABLE 1A-LB

CITY OF LONG BEACH - GAS & OIL DEPARTMENT

ANNUAL GAS SUPPLY AND SENDOUT - MMCF/DAY
AVERAGE YEAR FORECAST 2020 CGR report
LINE ACTUAL DELIVERIES BY END-USE 2020 2021 2022 2023 LINE 1 CORE Residential 12.9 12.9 12.9 12.9 1
2 CORE/NONCORE Commercial 6.1 6.1 6.1 6.1 2
3 CORE/NONCORE Industrial 4.7 4.7 4.7 4.7 3
4 Subtotal 23.8 23.8 23.8 23.8 4
5 NON CORE Non-EOR Cogeneration 1.7 1.7 1.7 1.7 5
6 EOR Cogen. & Steaming 0.0 0.0 0.0 0.0 6
7 Electric Utilities 0.0 0.0 0.0 0.0 7
8 Subtotal 1.7 1.7 1.7 1.7 8
9 WHOLESALE Residential 0.0 0.0 0.0 0.0 9
10 Com. & Ind., others 0.0 0.0 0.0 0.0 10
11 Electric Utilities 0.0 0.0 0.0 0.0 11
12 Subtotal-WHOLESALE 0.0 0.0 0.0 0.0 12
13 Co. Use & LUAF 0.8 0.8 0.8 0.8 13
14 Subtotal-END USE 26.3 26.3 26.3 26.3 14
15 Storage Injection 0.0 0.0 0.0 0.0 15
16 SYSTEM TOTAL-THROUGHPUT 26.3 26.3 26.3 26.3 16

ACTUAL TRANSPORTATION AND EXCHANGE
17 Residential N/A N/A N/A N/A 17
18 Commercial/Industrial 3.1 3.1 3.1 3.1 18
19 Non-EOR Cogeneration 1.5 1.5 1.5 1.5 19
20 EOR Cogen. & Steaming N/A N/A N/A N/A 20
21 Electric Utilites N/A N/A N/A N/A 21
22 Subtotal-RETAIL 4.7 4.7 4.7 4.7 22
23 WHOLESALE All End Uses 0.0 0.0 0.0 0.0 23
24 TOTAL TRANSPORTATION & EXCHANGE 4.7 4.7 4.7 4.7 24

ACTUAL CURTAILMENT
25 Residential 0.0 0.0 0.0 0.0 25
26 Commercial/Industrial 0.0 0.0 0.0 0.0 26
27 Non-EOR Cogeneration 0.0 0.0 0.0 0.0 27
28 EOR Cogen. & Steaming 0.0 0.0 0.0 0.0 28
29 Electric Utilites 0.0 0.0 0.0 0.0 29
30 Wholesale 0.0 0.0 0.0 0.0 30
31 TOTAL- Curtailment 0.0 0.0 0.0 0.0 31
32 REFUSAL 0.0 0.0 0.0 0.0 32
NOTE: Actual deliveries by end-use includes sales, transportation, and exchange volumes, but excludes actual curtailments. 1533 of 2287

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TABLE 39 – CITY OF LONG BEACH-ENERGY RESOURCES DEPARTMENT : TABLE 1A-LB ANNUAL GAS SUPPLY AND SENDOUT – MMcf/d
AVERAGE YEAR FORECAST FOR THE 2020 CGR REPORT
(CONTINUED)
TABLE 1A-LB

CITY OF LONG BEACH - GAS & OIL DEPARTMENT

ANNUAL GAS SUPPLY AND SENDOUT - MMCF/DAY
AVERAGE YEAR FORECAST 2020 CGR report
LINE ACTUAL DELIVERIES BY END-USE 2024 2025 2030 2035 LINE 1 CORE Residential 12.9 12.9 12.9 12.9 1
2 CORE/NONCORE Commercial 6.1 6.1 6.1 6.1 2
3 CORE/NONCORE Industrial 4.7 4.7 4.7 4.7 3
4 Subtotal 23.8 23.8 23.8 23.8 4
5 NON CORE Non-EOR Cogeneration 1.7 1.7 1.7 1.7 5
6 EOR Cogen. & Steaming 0.0 0.0 0.0 0.0 6
7 Electric Utilities 0.0 0.0 0.0 0.0 7
8 Subtotal 1.7 1.7 1.7 1.7 8
9 WHOLESALE Residential 0.0 0.0 0.0 0.0 9
10 Com. & Ind., others 0.0 0.0 0.0 0.0 10
11 Electric Utilities 0.0 0.0 0.0 0.0 11
12 Subtotal-WHOLESALE 0.0 0.0 0.0 0.0 12
13 Co. Use & LUAF 0.8 0.8 0.8 0.8 13
14 Subtotal-END USE 26.3 26.3 26.3 26.3 14
15 Storage Injection 0.0 0.0 0.0 0.0 15
16 SYSTEM TOTAL-THROUGHPUT 26.3 26.3 26.3 26.3 16

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TABLE 40 – CITY OF LONG BEACH-ENERGY RESOURCES DEPARTMENT : TABLE 1-LB ANNUAL GAS SUPPLY AND SENDOUT – MMcf/d
COLD YEAR FORECAST FOR THE 2020 CGR REPORT
TABLE 1-LB

CITY OF LONG BEACH - GAS & OIL DEPARTMENT

ANNUAL GAS SUPPLY AND SENDOUT - MMCF/DAY
COLD YEAR FORECAST 2020 CGR report
LINE GAS SUPPLY AVAILABLE 2020 2021 2022 2023 LINE
California Source Gas
1 Regular Purchases 0.0 0.0 0.0 0.0 1
2 Received for Exchange/Transport 0.0 0.0 0.0 0.0 2
3 Total California Source Gas 0.0 0.0 0.0 0.0 3
4 Purchases from Other Utilities 0.0 0.0 0.0 0.0 4
Out-of-State Gas
5 Pacific Interstate Companies 0.0 0.0 0.0 0.0 5
6 Additional Core Supplies 0.0 0.0 0.0 0.0 6
7 Incremental Supplies 0.0 0.0 0.0 0.0 7
8 Out-of-State Transport 0.0 0.0 0.0 0.0 8

0.0 0.0 0.0 0.0
9 Total Out-of-State Gas 0.0 0.0 0.0 0.0 9
10 Subtotal 0.0 0.0 0.0 0.0 10
11 Underground Storage Withdrawal 0.0 0.0 0.0 0.0 11
12 GAS SUPPLY AVAILABLE 0.0 0.0 0.0 0.0 12

GAS SUPPLY TAKEN
California Source Gas
13 Regular Purchases 1.3 1.3 1.3 1.3 13
14 Received for Exchange/Transport 0.0 0.0 0.0 0.0 14
15 Total California Source Gas 1.3 1.3 1.3 1.3 15
16 Purchases from Other Utilities 0.0 0.0 0.0 0.0 16
Out-of-State Gas
17 Pacific Interstate Companies 0.0 0.0 0.0 0.0 17
18 Additional Core Supplies 0.0 0.0 0.0 0.0 18
19 Incremental Supplies 29.4 29.4 29.4 29.4 19
20 Out-of-State Transport 0.0 0.0 0.0 0.0 20
21 Total Out-of-State Gas 29.4 29.4 29.4 29.4 21
22 22 Subtotal 30.8 30.8 30.8 30.8
23 23 Underground Storage Withdrawal 0.0 0.0 0.0 0.0
24 24 TOTAL Gas Supply Taken & Transported 30.76 30.8 30.8 30.8 1535 of 2287

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TABLE 40 – CITY OF LONG BEACH-ENERGY RESOURCES DEPARTMENT : TABLE 1-LB ANNUAL GAS SUPPLY AND SENDOUT – MMcf/d
COLD YEAR FORECAST FOR THE 2020 CGR REPORT
(CONTINUED)
TABLE 1-LB

CITY OF LONG BEACH - GAS & OIL DEPARTMENT

ANNUAL GAS SUPPLY AND SENDOUT - MMCF/DAY
COLD YEAR FORECAST 2020 CGR report
LINE GAS SUPPLY AVAILABLE 2024 2025 2030 2035 LINE
California Source Gas
1 Regular Purchases 0.0 0.0 0.0 0.0 1
2 Received for Exchange/Transport 0.0 0.0 0.0 0.0 2
3 Total California Source Gas 0.0 0.0 0.0 0.0 3
4 Purchases from Other Utilities 0.0 0.0 0.0 0.0 4
Out-of-State Gas
5 Pacific Interstate Companies 0.0 0.0 0.0 0.0 5
6 Additional Core Supplies 0.0 0.0 0.0 0.0 6
7 Incremental Supplies 0.0 0.0 0.0 0.0 7
8 Out-of-State Transport 0.0 0.0 0.0 0.0 8

0.0 0.0 0.0 0.0
9 Total Out-of-State Gas 0.0 0.0 0.0 0.0 9
10 Subtotal 0.0 0.0 0.0 0.0 10
11 Underground Storage Withdrawal 0.0 0.0 0.0 0.0 11
12 GAS SUPPLY AVAILABLE 0.0 0.0 0.0 0.0 12

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TABLE 41 – CITY OF LONG BEACH-ENERGY RESOURCES DEPARTMENT : TABLE 1A-LB ANNUAL GAS SUPPLY AND SENDOUT – MMcf/d
COLD YEAR FORECAST FOR THE 2020 CGR REPORT
TABLE 1A-LB

CITY OF LONG BEACH - GAS & OIL DEPARTMENT

ANNUAL GAS SUPPLY AND SENDOUT - MMCF/DAY
COLD YEAR FORECAST 2020 CGR report
LINE ACTUAL DELIVERIES BY END-USE 2020 2021 2022 2023 LINE 1 CORE Residential 15.1 15.1 15.1 15.1 1
2 CORE/NONCORE Commercial 7.2 7.2 7.2 7.2 2
3 CORE/NONCORE Industrial 5.6 5.6 5.6 5.6 3
4 Subtotal 27.8 27.8 27.8 27.8 4
5 NON CORE Non-EOR Cogeneration 2.0 2.0 2.0 2.0 5
6 EOR Cogen. & Steaming 0.0 0.0 0.0 0.0 6
7 Electric Utilities 0.0 0.0 0.0 0.0 7
8 Subtotal 2.0 2.0 2.0 2.0 8
9 WHOLESALE Residential 0.0 0.0 0.0 0.0 9
10 Com. & Ind., others 0.0 0.0 0.0 0.0 10
11 Electric Utilities 0.0 0.0 0.0 0.0 11
12 Subtotal-WHOLESALE 0.0 0.0 0.0 0.0 12
13 Co. Use & LUAF 0.9 0.9 0.9 0.9 13
14 Subtotal-END USE 30.8 30.8 30.8 30.8 14
15 Storage Injection 0.0 0.0 0.0 0.0 15
16 SYSTEM TOTAL-THROUGHPUT 30.8 30.8 30.8 30.8 16

ACTUAL TRANSPORTATION AND EXCHANGE
17 Residential N/A N/A N/A N/A 17
18 Commercial/Industrial 3.6 3.6 3.6 3.6 18
19 Non-EOR Cogeneration 1.8 1.8 1.8 1.8 19
20 EOR Cogen. & Steaming N/A N/A N/A N/A 20
21 Electric Utilites N/A N/A N/A N/A 21
22 Subtotal-RETAIL 5.4 5.4 5.4 5.4 22
23 WHOLESALE All End Uses 0.0 0.0 0.0 0.0 23
24 TOTAL TRANSPORTATION & EXCHANGE 5.4 5.4 5.4 5.4 24

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TABLE 41 – CITY OF LONG BEACH-ENERGY RESOURCES DEPARTMENT : TABLE 1A-LB ANNUAL GAS SUPPLY AND SENDOUT – MMcf/d
COLD YEAR FORECAST FOR THE 2020 CGR REPORT
(CONTINUED)
TABLE 1A-LB

CITY OF LONG BEACH - GAS & OIL DEPARTMENT

ANNUAL GAS SUPPLY AND SENDOUT - MMCF/DAY
COLD YEAR FORECAST 2020 CGR report
LINE ACTUAL DELIVERIES BY END-USE 2024 2025 2030 2035 LINE 1 CORE Residential 15.1 15.1 15.1 15.1 1
2 CORE/NONCORE Commercial 7.2 7.2 7.2 7.2 2
3 CORE/NONCORE Industrial 5.6 5.6 5.6 5.6 3
4 Subtotal 27.8 27.8 27.8 27.8 4
5 NON CORE Non-EOR Cogeneration 2.0 2.0 2.0 2.0 5
6 EOR Cogen. & Steaming 0.0 0.0 0.0 0.0 6
7 Electric Utilities 0.0 0.0 0.0 0.0 7
8 Subtotal 2.0 2.0 2.0 2.0 8
9 WHOLESALE Residential 0.0 0.0 0.0 0.0 9
10 Com. & Ind., others 0.0 0.0 0.0 0.0 10
11 Electric Utilities 0.0 0.0 0.0 0.0 11
12 Subtotal-WHOLESALE 0.0 0.0 0.0 0.0 12
13 Co. Use & LUAF 0.9 0.9 0.9 0.9 13
14 Subtotal-END USE 30.8 30.8 30.8 30.8 14
15 Storage Injection 0.0 0.0 0.0 0.0 15
16 SYSTEM TOTAL-THROUGHPUT 30.8 30.8 30.8 30.8 16

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2020 CALIFORNIA GAS REPORT

SAN DIEGO GAS & ELECTRIC COMPANY
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INTRODUCTION
SDG&E is a combined gas and electric distribution utility serving more than three million people in San Diego and the southern portions of Orange counties. SDG&E delivered natural gas to 890,818 customers in San Diego County in 2019, including power plants and turbines.

Total gas sales and transportation through SDG&E’s system for 2019 were approximately 86 billion cubic feet (Bcf), which is an average of 235 MMcf/d. 1540 of 2287

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GAS DEMAND

OVERVIEW
SDG&E’s gas demand forecast is largely determined by the long-term economic outlook for its San Diego County service area. The county’s economic trends are expected to generally parallel those of the larger SoCalGas area as discussed above.

This projection of natural gas requirements, excluding EG demand, is derived from models that integrate demographic assumptions, economic growth, energy prices, energy efficiency programs, customer information programs, building and appliance standards, weather and other factors. Weather-normalized non-EG gas demand is projected to drop slightly from 57 Bcf in 2019 to 54 Bcf in 2035. Including EG, overall demand adjusted for average temperature conditions totaled 86 Bcf in 2019 and is expected to drop about 0.6 percent per year to 77 Bcf by 2035.

Assumptions for SDG&E’s gas transportation requirements for EG are included as part of the wholesale market sector description for SoCalGas.

ECONOMICS AND DEMOGRAPHICS
SDG&E’s gas demand forecast is largely determined by the long-term economic outlook for its San Diego County service area. The county’s economic trends are expected to generally parallel those of the larger SoCalGas area as discussed above. San Diego County’s total employment is forecasted to grow an average of 0.7 percent annually from 2019-2035; the subset of industrial (mining and manufacturing) jobs is projected to shrink an average of 0.3 percent per year during the same period. The number of SDG&E gas meters is expected to increase an average of 0.73 percent annually from 2019 through 2035. 1541 of 2287

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FIGURE 22 – SDG&E’S COMPOSITION OF NATURAL GAS THROUGHPUT AVERAGE TEMPERATURE, NORMAL YEAR (2019-2035)
(Bcf/y)
From 2019 through 2035, SDG&E’s forecasted gas demand is expected to decline at an average annual rate of 0.6 percent. The decline is driven by future projected reductions in the EG load. Additional factors reducing the load forecast are energy efficiency programs and new requirements on Title 24 building codes and standards.

MARKET SECTORS

RESIDENTIAL
The total residential customer count for SDG&E consists of four residential segment types.

These are single family and multi-family customers, as well as master meter and sub-metered customers. Residential demand adjusted for average temperature conditions totaled 31 Bcf in 2019. By the year 2035, the residential demand is expected to drop to 28 Bcf. The change reflects a 0.53 percent average annual rate of decline.

The projected residential natural gas demand is influenced primarily by residential meter growth moderated by forecasted declining use per customer, due mainly to energy efficiency improvements in building shell design, appliance efficiency and CPUC-authorized EE programs. 1542 of 2287

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FIGURE 23 – COMPOSITION OF SDG&E’S RESIDENTIAL DEMAND FORECAST AVERAGE YEAR WEATHER DESIGN, 2019-2035
(Bcf/y)

COMMERCIAL
On a temperature-adjusted basis, SDG&E’s core commercial demand in 2019 totaled

17.4 Bcf. By the year 2035, the core commercial load is expected to decline slightly to 16.9 Bcf.

SDG&E’s non-core commercial load in 2019 was 2.3 Bcf. Over the forecast period, gas demand in this market is projected to grow an average of 0.6 percent per year to 2.5 Bcf by 2035, driven by increased economic activity and employment.
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FIGURE 24 –SDG&E COMMERCIAL NATURAL GAS DEMAND FORECAST

AVERAGE YEAR WEATHER DESIGN
(2019-2035)

INDUSTRIAL
Temperature-adjusted core industrial demand was 1.41 Bcf in 2019 and is expected to decline to 1.19 Bcf by 2035, an average decrease of 1.1 percent per year. This result is due to slightly lower employment growth and the impact of savings from CPUC-authorized energy efficiency programs in the industrial sector.
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FIGURE 25 –SDG&E INDUSTRIAL NATURAL GAS DEMAND FORECAST

AVERAGE YEAR WEATHER DESIGN
(2019-2035)
Non-core industrial load in 2019 was 2.4 Bcf and is expected to shrink about 0.6 percent per year to 2.2 Bcf by 2035. Demand-dampening effects of higher energy efficiency and higher carbon-allowance fees will more than offset slight increases from economic growth.

ELECTRIC GENERATION
Total EG, including cogeneration and non-cogeneration EG, was 29 Bcf in 2019. From 2019, EG load is expected to decline an average of 1.35 percent per year to 23 Bcf by 2035. The following graph shows total EG forecasts for a normal hydro year and a 1-in-10 dry hydro year. 1545 of 2287

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FIGURE 26 – SDG&E’S TOTAL EG GAS DEMAND: BASE HYDRO AND 1-IN-10 DRY HYDRO DESIGN, 2019-2035
(Bcf/y)
Small Cogeneration (<20 MW)
Small EG load from self-generation totaled 7.0 Bcf in 2019. By 2035, small EG load is expected to drop to 5.8 Bcf – dropping an average of 1.2 percent per year. Demand-dampening effects of higher carbon-allowance fees will more than offset slight increases from economic growth.

Electric Generation Including Large Cogeneration (>20 MW) The forecast of large EG loads in SDG&E’s service area is based on the power market simulation noted in SoCalGas’ EG chapter for “Electric Generation Including All Cogeneration EG demand is forecasted to decrease from 29 Bcf in 2020 to 18 Bcf in 2030. This forecast includes no additional thermal generating resources in its service area, and it assumes no retirement during the same time period. The EG forecast is held constant at 2030 levels through 2035, as previously explained.

A 1-in-10 year dry hydro sensitivity forecast has also been developed. A dry hydro year increases SDG&E’s EG demand on average for the forecast period by approximately 4 Bcf per year. For additional information on EG assumptions, such as renewable generation, GHG adders 1546 of 2287

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and sensitivity to electric demand and attainment of renewables’ goals, refer to the EG section of the SoCalGas EG chapter.

NATURAL GAS VEHICLES
Natural gas is a clean-burning alternative vehicle fuel that offers several advantages to users when compared to diesel. According to the Clean Cities Guide to Alternative Fuel and Advanced Medium- and Heavy-Duty Vehicles by the U.S. DOE,101 a switch from conventional diesel vehicles to NGVs has the potential to result in lower levels of emissions, including NOx and particulate matter. In 2019 alone, SDG&E’s NGVs displaced the equivalent of 17 million gallons of gasoline and prevented around 75 thousand metric tons of emissions. Additionally, natural gas is generally less expensive than diesel or gasoline, which can become an attractive option for buyers in the heavy-duty vehicle industry.

SDG&E customers benefit from the LCFS credits generated from the gas consumed at utility owned CNG stations. The revenue from the sales is distributed to consumers as a price reduction at those fueling stations.

The clean vehicle market is expected to grow due to strong economic fundamentals, increased vehicle options, the continuation of government (federal, state and local) incentives, additional regulations encouraging alternative fuel vehicle adoption, and regional collaboration for the deployment of necessary infrastructure. Additionally, since April 2019 SDG&E has been procuring 100 percent renewable natural gas (RNG) at all utility-owned CNG stations, which provides significant GHG emission reduction benefits.

However, growth may be offset by competing technologies and fuels, as well as the potentially lower cost differential between petroleum (gasoline and diesel) and natural gas. In 2019, SDG&E served 33 compressed natural gas (CNG) fueling stations located throughout the service territory and delivered approximately 2 Bcf of natural gas. The SDG&E NGV market is expected to grow at an average annual rate of 3 percent over the forecast horizon. 101 U.S. DOE | Energy Efficiency & Renewable Energy: Clean Cities Guide to Alternative Fuel and Advanced Medium- and Heavy-Duty Vehicles.
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FIGURE 27 – ANNUAL NGV DEMAND FORECAST

ENERGY EFFICIENCY PROGRAMS
Conservation and energy efficiency activities encourage customers to install energy efficient equipment and weatherization measures and adopt energy saving practices that result in reduced gas usage, while still maintaining a comparable level of service. Conservation and energy efficiency load impacts are shown as positive numbers. The “total net load impact” is the natural gas throughput reduction resulting from the energy efficiency programs.

The cumulative net load impact forecast from SDG&E’s integrated gas and electric energy efficiency programs for selected years is shown in the graph below. The net load impact includes all energy efficiency programs, both gas and electric, that SDG&E has forecasted to be implemented beginning in year 2020 and occurring through the year 2035 in addition to the Title 24 Codes and Standards expected over the 2020-2035 horizon. Savings and goals for these programs are based on the program goals authorized by the Commission in D.19-08-034. 1548 of 2287

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FIGURE 28 – SDG&E ANNUAL ENERGY EFFICIENCY CUMULATIVE SAVING GOALS (Bcf)
Savings reported are for measures installed under SDG&E’s gas and electric Energy Efficiency programs. Credit is only taken for measures that are installed as a result of SDG&E’s Energy Efficiency programs, and only for the measure lives of the measures installed.102 Measures with useful lives less than the forecast planning period fall out of the forecast when their expected life is reached. Naturally occurring conservation that is not attributable to SDG&E’s Energy Efficiency activities is not included in the Energy Efficiency forecast. 102 “Hard” impacts include measures requiring a physical equipment modification or replacement.

SDG&E does not include “soft” impacts, e.g., energy management services type measures. 1549 of 2287

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GAS SUPPLY
Beginning in April 2008, gas supplies to serve both SoCalGas’ and SDG&E’s retail core gas demand are procured with a combined SoCalGas/SDG&E portfolio per D.07-12-019 of December 6, 2007. For more information, refer above to the “Gas Supply, Capacity, and Storage” section in the Southern California part of this report. 1550 of 2287

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REGULATORY ENVIRONMENT

GENERAL RATE CASE
On September 26, 2019, CPUC unanimously approved a final 2019 GRC decision that adopts a TY 2019 revenue requirement of $1.990 billion for SDG&E’s combined operations ($1.590 billion for electric, $0.400 billion for gas) which is $213 million lower than the $2.203 billion (including OMEC) that SDG&E had requested in its Update testimony. The adopted revenue requirement represents an increase of $107 million or a 5.7 percent increase over 2018. The final decision adopts PTY revenue requirement adjustments for SDG&E of $134 million for 2020 (6.7 percent increase) and $102 million for 2021 (4.8 percent increase).

In January 2020 the CPUC revised the rate case plans and implemented a 4-year GRC cycle for California IOUs. SDG&E was directed to file a PFM to revise its 2019 GRC decision to add two additional attrition years including adjustment amounts, resulting in a transitional five-year GRC period (2019-2023).

In April 2020 (then slightly revised in May), SDG&E filed a PFM of its 2019 GRC decision requesting attrition year increases of $94 million (+4.24 percent) for 2022 and $96 million (+4.13 percent) for 2023. SDG&E requested that a final decision be issued no later than October 1, 2020.

OTHER REGULATORY MATTERS
For more information on non-GRC regulatory matters, refer above to the “Regulatory Environment” section in the Southern California part of this report, which generally applies to SDG&E’s gas business as well.
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PEAK DAY DEMAND
Gas supplies to serve both SoCalGas’ and SDG&E’s retail core gas demand are procured with a combined portfolio that contains a total firm storage withdrawal capacity designed to serve the utilities’ combined retail core peak day gas demand. Please see the corresponding discussion of “Peak Day Demand and Deliverability” under the SoCalGas portion of this report for an illustration of how storage and flowing supplies can meet the growth in forecasted load for the combined (SoCalGas and SDG&E) retail core peak day demand. 1552 of 2287

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2020 CALIFORNIA GAS REPORT
SAN DIEGO GAS & ELECTRIC COMPANY – TABULAR DATA
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TABLE 42 – SDG&E
ANNUAL GAS SUPPLY AND SENDOUT – MMcf/d
RECORDED YEARS 2015-2019
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TABLE 42 – SDG&E
ANNUAL GAS SUPPLY AND SENDOUT – MMcf/d
RECORDED YEARS 2015-2019
(CONTINUED)
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TABLE 43 – SDG&E: TABLE 1-SDGE
ANNUAL GAS SUPPLY AND REQUIREMENTS – MMcf/d
ESTIMATED YEARS 2020-2024

AVERAGE TEMPERATURE YEARS
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TABLE 44 – SDG&E: TABLE 2-SDGE
ANNUAL GAS SUPPLY AND REQUIREMENTS – MMcf/d
ESTIMATED YEARS 2025-2035

AVERAGE TEMPERATURE YEARS
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TABLE 45 – SDG&E: TABLE 3-SDGE
ANNUAL GAS SUPPLY AND REQUIREMENTS – MMcf/d
ESTIMATED YEARS 2020-2024
COLD TEMPERATURE YEAR (1-IN-35 COLD YEAR EVENT) AND DRY HYDRO YEAR 1558 of 2287

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TABLE 46 – SDG&E: TABLE 4-SDGE
ANNUAL GAS SUPPLY AND REQUIREMENTS – MMcf/d
ESTIMATED YEARS 2025-2035
COLD TEMPERATURE YEAR (1-IN-35 COLD YEAR EVENT) AND DRY HYDRO YEAR 1559 of 2287

GLOSSARY
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2020 CALIFORNIA GAS REPORT

GLOSSARY
1560 of 2287

GLOSSARY
-184-

GLOSSARY
A.

Application.

AAEE
Additional Achievable Energy Efficiency.

AB
Assembly Bill.

AMI
Advanced Metering Infrastructure.

APD
Abnormal Peak Day.

API
American Petroleum Institute.

A/S
Ancillary services.

Average Day (Operational Definition)
Annual gas sales or requirements assuming average temperature year conditions divided by 365 days.

Average Temperature Year
Long-term average recorded temperature.

Bcf
Billion cubic feet.

Bcf/d
Billion cubic feet per day.

Bcf/y
Billion cubic feet per year.
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GLOSSARY
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Btu (British thermal unit)
Unit of measurement equal to the amount of heat energy required to raise the temperature of one pound of water 1-degree F. This unit is commonly used to measure the quantity of heat available from complete combustion of natural gas.

CAISO
California Independent System Operator.

CalGEM
California Geologic Energy Management Division (formerly, DOGGR).

California-Source Gas

1. Regular Purchases – All gas received or forecasted from California producers, excluding exchange volumes. Also referred to as Local Deliveries.

2. Received for Exchange/Transport – All gas received or forecasted from California producers for exchange, payback, or transport.

CARB
California Air Resources Board.

CCST
California Council on Science and Technology.

CDFA
California Department of Food and Agriculture.

CEC
California Energy Commission.

CFR
Code of Federal Regulations.

CGR
California Gas Report.

CNG (Compressed Natural Gas)
Fuel for NGVs, typically natural gas compressed to 3000 pounds per square inch.

CO2
Carbon dioxide.

Cogeneration
Simultaneous production of electricity and thermal energy from the same fuel source. Also used to designate a separate class of gas customers. 1562 of 2287

GLOSSARY
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Cold Temperature Year
Cold design-temperature conditions based on long-term recorded weather data.

Combined Heat and Power (CHP)
Combined Heat and Power (CHP) is the sequential production of electricity and thermal energy from the same fuel source. Historically, CHP has been perceived as an efficient technology and is promoted in California as a preferred EG resource.

Commercial (SoCalGas and SDG&E)
Category of gas customers whose establishments consist of services, manufacturing nondurable goods, dwellings not classified as residential, and farming (agricultural).

Commercial (PG&E)
Non-residential gas customers not engaged in EG, EOR, or gas resale activities with usage less than 20,800 therms per month.

Commission
California Public Utilities Commission (see also CPUC).

Company Use
Gas used by utilities for operational purposes, such as fuel for line compression and injection into storage.

Conversion Factor (LNG)
Approximate LNG liquid conversion factor for one therm (High-Heat Value). • Pounds 4.2020
• Gallons 1.1660
• Cubic Feet 0.1570
• Barrels 0.0280
• Cubic Meters 0.0044
• Metric Tonnes 0.0019
Conversion Factor (Natural Gas)
• 1 cf (Cubic Feet) = Approx. 1,000 Btus
• 1 Ccf = 100 cf = Approximately 1 Therm
• 1 Therm = 100,000 Btus = Approximately 100 cf = 0.1 Mcf • 10 Therms = 1 Dth (dekatherm) = Approximately 1 Mcf
• 1 Mcf = 1,000 cf = Approximately 10 Therms = 1 MMBtu
• 1 MMcf = 1 million cubic feet = Approximately 1 MDth (1 thousand dekatherm) • 1 Bcf = 1 billion cf = Approximately 1 million MMBtu
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GLOSSARY
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Conversion Factor (Petroleum Products)
Approximate heat content of petroleum products (MMBtu per Barrel). • Crude Oil 5.800
• Residual Fuel Oil 6.287
• Distillate Fuel Oil 5.825
• Petroleum Coke 6.024
• Butane 4.360
• Propane 3.836
• Pentane Plus 4.620
• Motor Gasoline 5.253
Core Aggregator
Individuals or entities arranging natural gas commodity procurement activities on behalf of core customers. Also, sometimes known as an Energy Service Provider (ESP), a Core Transport Agent (CTA), or a Retail Service Provider.

Core Customer (PG&E)
All customers with average usage less than 20,800 therms per month.

Core Customers (SoCalGas and SDG&E)
All residential customers; all commercial and industrial customers with average usage less than 20,800 therms per month who typically cannot fuel switch. Also, those commercial and industrial customers (whose average usage is more than 20,800 therms per year) who elect to remain a core customer receiving bundled gas service from the LDC.

Core Subscription
Noncore customers who elect to use the LDC as a procurement agent to meet their commodity gas requirements.

COVID-19
Coronavirus Disease 2019.

CPUC
California Public Utilities Commission (see also Commission).

Cubic Foot of Gas
Volume of natural gas, which, at a temperature of 60 degrees F and an absolute pressure of

14.73 pounds per square inch, occupies one cubic foot.

Curtailment
Temporary suspension, partial or complete, of gas deliveries to a customer or customers.

Decision.
1564 of 2287

GLOSSARY
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DDRDP
Dairy Digester Research and Development Program.

DOE
Department of Energy.

DOGGR
California Division of Oil, Gas, and Geothermal Resources (now CalGEM).

ECA
Energia Costal Azul.

EG
Electric Generation (including cogeneration) by a utility, customer, or independent power producer.

Energy Service Provider (ESP)
Individuals or entities engaged in providing retail energy services on behalf of customers. ESP’s may provide commodity procurement, but could also provide other services, e.g., metering and billing.

EO
Executive Order.

EOR (Enhanced Oil Recovery)
Injection of steam into oil-holding geologic zones to increase ability to extract oil by lowering its viscosity. Also used to designate a special category of gas customers.

Exchange
Delivery of gas by one party to another and the delivery of an equivalent quantity by the second party to the first. Such transactions usually involve different points of delivery and may or may not be concurrent.

EWG (Exempt Wholesale Generator)
A category of customers consuming gas for the purpose of generating electric power.

F
Fahrenheit.

FERC
Federal Energy Regulatory Commission.

FTA
Free Trade Agreement. 1565 of 2287

GLOSSARY
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Futures (Gas)
Unit of natural gas futures contract trades in units of 10,000 MMBtu at the New York Mercantile Exchange (NYMEX). The price is based on delivery at Henry Hub in Louisiana.

Gas Accord
The Gas Accord is a multi-party settlement agreement, which restructured PG&E’s gas transportation and storage services. The settlement was filed with the CPUC in August 1996, approved by the CPUC in August 1997 (D.97-08-055) and implemented by PG&E in March 1998. In D.03-12-061, the CPUC ordered the Gas Accord structure to continue for 2004 and 2005. Key features of the Gas Accord structure include the following: unbundling of PG&E’s gas transmission service and a portion of its storage service; placing PG&E at risk for transmission service and a portion of its storage service; placing PG&E at risk for transmission and storage costs and revenues; establishing firm, tradable transmission and storage rights; and establishing transmission and storage rates.

Gas Sendout
That portion of the available gas supply that is delivered to gas customers for consumption, plus shrinkage.

GHG (Green House Gas)
GHGs are the gases present in the atmosphere which reduce the loss of heat into space and therefore contribute to global temperatures through the greenhouse effect. The most the most abundant GHGs are, in order of relative abundance are water vapor, CO2, methane, nitrous oxide, ozone and CFCs.

GRC
General Rate Case.

GT&S
Gas Transmission and Storage.

GTN
Gas Transmission Northwest LLC.

H2
Hydrogen.

HDD (Heating Degree Day)
A HDD is accumulated for every degree F the daily average temperature is below a standard reference temperature (SoCalGas and SDG&E: 65 degrees F; PG&E 60 degrees F). A basis for computing how much electricity and gas are needed for space heating purposes. For example, for a 50 degrees F average temperature day, SoCalGas and SDG&E would accumulate 15 HDD, and PG&E would accumulate 10 HDD.
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GLOSSARY
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Heating Value
Number of Btu’s liberated by the complete combustion at constant pressure of one cubic foot of natural gas at a base temperature of 60 degrees F and a pressure base of 14.73 psia, with air at the same temperature and pressure as the natural gas, after the products of combustion are cooled to the initial temperature of natural gas, and after the water vapor of the combustion is condensed to the liquid state. The heating value of the natural gas shall be corrected for the water vapor content of the natural gas being delivered except that, if such content is 7 pounds or less per one million cubic feet, the natural gas shall be considered dry.

IEPR
Integrated Energy Policy Report.

ILI
In-Line Inspection.

Industrial (PG&E)
Non-residential customers not engaged in EG, EOR, or gas resale activities using more than 20,800 therms per month.

Industrial (SoCalGas and SDG&E)
Category of gas customers who are engaged in mining and in manufacturing.

IOU
investor-owned utility.

IRP
CPUC SB350 Integrated Resource Plan.

LCFS
Low Carbon Fuel Standard.

LDC
Local electric and/or natural gas distribution company.

LNG (Liquefied Natural Gas)
Natural gas that has been super cooled to -260 degrees F (-162 degrees C) and condensed into a liquid that takes up 600 times less space than in its gaseous state.

Load Following
A utility’s practice of adding additional generation to available energy supplies to meet moment-to-moment demand in the distribution system served by the utility, and for keeping generating facilities informed of load requirements to insure that generators are producing neither too little nor too much energy to supply the utilities’ customers. 1567 of 2287

GLOSSARY
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MCF
The volume of natural gas which occupies 1,000 cubic feet when such gas is at a temperature of 60 degrees F and at a standard pressure of approximately 15 pounds per square inch.

MHP
Mobile Home Park.

MMBtu
Million British thermal units. One MMBtu is equals to 10 therms or one dekatherm.

MMcf/d
Million cubic feet per day.
mmt
million metric tons.
mmtCO2e
million metric tons of carbon dioxide equivalent.
mtCO2e
metric tons of carbon dioxide equivalent.

MW
Megawatt.

MWh
Megawatt-hour.

NGSS
Natural Gas Storage Strategy.

NGTL
NOVA Gas Transmission Ltd.

NGV (Natural Gas Vehicle)
Vehicle that uses CNG or LNG as its source of fuel for its internal combustion engine. 1568 of 2287

GLOSSARY
-192-
Noncore Customers
Commercial and industrial customers whose average usage exceeds 20,800 therms per month, including qualifying cogeneration and solar electric projects. Noncore customers assume gas procurement responsibilities and receive gas transportation service from the utility under firm or interruptible intrastate transmission arrangements.

Non-Utility Served Load
The volume of gas delivered directly to customers by an interstate or intrastate pipeline or other independent source instead of the local distribution company.

Off-System Sales
Gas sales to customers outside the utility’s service area.

OIR
Order Instituting Rulemaking.

OTC
once-through-cooling.

Out-of-State Gas
Gas from sources outside the state of California.

PFM.

Petition for Modification.

PG&E
Pacific Gas and Electric Company.

PHMSA
Pipeline and Hazardous Materials Safety Administration.

Priority of Service (PG&E)
In the event of a curtailment situation, PG&E curtails gas usage to customers based on the following end-use priorities:

1. Core Residential;

2. Non-residential Core;

3. Noncore using firm backbone service (including UEG);

4. Noncore using as-available backbone service (including UEG); and

5. Market Center Services.
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GLOSSARY
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Priority of Service (SoCalGas + SDG&E)
In the event of a curtailment situation, SoCalGas and SDG&E curtail gas usage to customers in the following order:
• Up to 60 percent (November thru March) or 40 percent (April thru October) of dispatched EG load;
• Up to 100 percent of non-EG noncore except for refineries; • Up to 100 percent of refineries and up to 100 percent of the remaining dispatched EG load; • Non-Residential Core customers; and
• Residential Core customers.

PSEP
Pipeline Safety Enhancement Plan.

PSIA
Pounds per square inch absolute. Equal to gauge pressure plus local atmospheric pressure.

Pub. Util. Code
Public Utilities Code.

Purchase from Other Utilities
Gas purchased from other utilities in California.

Rulemaking.

R&D
Research and Development.

RIN
Renewable Identification Number.

Requirements
Total potential demand for gas, including that served by transportation, assuming the availability of unlimited supplies at reasonable cost.

Res.

Resolution.

Resale
Gas customers who are either another utility or a municipal entity that, in turn, resells gas to end-use customers.
1570 of 2287

GLOSSARY
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Residential
A category of gas customers whose dwellings are single-family units, multi-family units, mobile homes, or other similar living facilities.

RG
Renewable Gas.

RGS
Renewable Gas Standard.

RNG
Renewable Natural Gas.

RP
Recommended Practice.

RPS
Renewables Portfolio Standard.

RSP
CPUC SB350 IRP Reference System Plan.

SB
Senate Bill.

SDG&E
San Diego Gas & Electric Company.

Short-Term Supplies
Gas purchased usually involving 30-day, short-term contract or spot gas supplies.

SLCP
Short-Lived Climate Pollutants.

SMUD
Sacramento Municipal Utility District.

SoCalGas
Southern California Gas Company.

Spot Purchases
Short-term purchases of gas typically not under contract and generally categorized as surplus or best efforts.
1571 of 2287

GLOSSARY
-195-
Storage Banking
The direct use of local distribution company gas storage facilities by customers or other entities to store self-procured commodity gas supplies.

Storage Injection
Volume of natural gas injected into underground storage facilities.

Storage Withdrawal
Volume of natural gas taken from underground storage facilities.

Supplemental Supplies
A utility’s best estimate for additional gas supplies that may be realized, from unspecified sources, during the forecast period.

SWG
Southwest Gas Corporation.

SWRCB
State Water Resources Control Board.

System Capacity or Normal System Capacity (Operational Definition) The physical limitation of the system (pipelines and storage) to deliver or flow gas to end-users.

System Utilization or Nominal System Capacity (Operational Definition) The use of system capacity or nominal system capacity at less than 100 percent utilization.

Take-or-Pay
A term used to describe a contract agreement to pay for a product (natural gas) whether or not the product is delivered.

Tariff
All rate schedules, sample forms, rentals, charges, and rules approved by regulatory agencies for used by the utility.

TCF
Trillion cubic feet.

Therm
A unit of energy measurement, nominally 100,000 BTUs.

Total Gas Supply Available
Total quantity of gas estimated to be available to meet gas requirements. 1572 of 2287

GLOSSARY
-196-
Total Gas Supply Taken
Total quantity of gas taken from all sources to meet gas requirements.

Total Throughput
Total gas volumes passing through the system including sales, company use, storage, transportation, and exchange.

Transportation Gas
Non-utility-owned gas transported for another party under contractual agreement.

UC
University of California.

UEG
Utility electric generation.

Unaccounted-For
Gas received into the system but unaccounted for due to measurement, temperature, pressure, or accounting discrepancies.

Unbundling
The separation of natural gas utility services into its separate service components, such as gas procurement, transportation, and storage with distinct rates for each service.

U.S.

United States.

USA
Underground Service Alert.

WACOG
Weighted average cost of gas.

WECC
Western Electricity Coordinating Council.

Wholesale
A category of customer, either a utility or municipal entity, that resells gas.

Wobbe
The Wobbe number of a fuel gas is found by dividing the high heating value of the gas in BTU per standard cubic feet (scf) by the square root of a specific gravity with respect to air. The higher a gases’ Wobbe number, the greater the heating value of the quality of gas that will flow through a hole of a given size in a given amount of time. 1573 of 2287

RESPONDENTS
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2020 CALIFORNIA GAS REPORT

RESPONDENTS
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RESPONDENTS
-198-

RESPONDENTS
The following utilities have been designated by the California Public Utilities Commission as respondents in the preparation of the California Gas Report. ▪ Pacific Gas and Electric Company
▪ San Diego Gas and Electric Company
▪ Southern California Gas Company
The following utilities also cooperated in the preparation of the report. ▪ City of Long Beach Municipal Energy Resources Department ▪ Sacramento Municipal Utilities District
▪ Southern California Edison Company
▪ Southwest Gas Corporation
▪ ECOGAS Mexico, S. de R.L. de C.V.

A statewide committee has been formed by the respondents and cooperating utilities to prepare this report. The following individuals served on this committee.

Working Committee
▪ Eric Semelius - Statewide Chair- PG&E
▪ Todd Peterson - PG&E
▪ Anupama Pandey - PG&E
▪ Rose-Marie Payan - SoCalGas/SDG&E
▪ Sharim Chaudhury - SoCalGas/SDG&E
▪ Scott Wilder - SoCalGas/SDG&E
▪ Nasim Ahmed - SoCalGas
▪ Jeff Huang – SoCalGas/SDG&E
▪ Michelle Clay-Ijomah - SDG&E
▪ Gary Lenart - SoCalGas
▪ Preston Miller - Kern River
Observers
▪ Jean Spencer - CPUC
▪ Renee Guild - CPUC
▪ Munir Fellahi - CPUC
▪ Robert Gulliksen - CEC
1575 of 2287

RESPONDENTS
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RESERVE YOUR SUBSCRIPTION
2021 CALIFORNIA GAS REPORT SUPPLEMENT
Southern California Gas Company
2021 CGR Reservation Form
Box 3249, Mail Location GT14D6
Los Angeles, CA 90051-1249
or
Fax: (213) 244-4957
Email: Sharim Chaudhury
[email protected]
❑Send me a 2021 CGR Supplement
❑New subscriber
❑Change of address
Company Name: ____________________________________________ C/O: ______________________________________________________ Address: ___________________________________________________ City: __________________ State: _____________ Zip: _________ Phone: ( _____ ) ________________ Fax: ( _____ ) ______________ Also, please visit our website at: www.socalgas.com
www.sdge.com
1576 of 2287

RESPONDENTS
-200-

RESERVE YOUR SUBSCRIPTION
2021 CALIFORNIA GAS REPORT – SUPPLEMENT
Pacific Gas and Electric Company
2021 CGR Reservation Form
Mail Code B10B
P. O. Box 770000
San Francisco, CA 94177
or
Email: [email protected]
❑Send me a 2021 CGR Supplement
❑New subscriber
❑Change of address
Company Name: ____________________________________________ C/O: ______________________________________________________ Address: ___________________________________________________ City: __________________ State: _____________ Zip: _________ Phone: ( _____ ) ________________ Fax: ( _____ ) ______________ Please visit our website for digital copies of this and past reports:
https://www.pge.com/pipeline/library/regulatory/cgr/index.page 1577 of 2287
1578 of 2287
2020 Cali fornia Gas Report
Decision D .95-01-039
1579 of 2287

ATTACHMENT E

SOUTH COAST AIR QUALITY MANAGEMENT DISTRICT
Draft Guidance Document – Interim CEQA Greenhouse Gas (GHG) Significance Threshold
October 2008
Deputy Executive Officer
Planning, Rule Development and Area Sources
Elaine Chang, DrPH
Assistant Deputy Executive Officer
Planning, Rule Development and Area Sources
Laki Tisopulos, Ph.D., P.E.

Planning and Rules Manager
Planning, Rule Development and Area Sources
Susan Nakamura

Author: Steve Smith, Ph.D. Program Supervisor
Michael Krause Air Quality Specialist
Contributors: Jeffery Inabinet Air Quality Specialist
James Koizumi Air Quality Specialist
Barbara Radlein Air Quality Specialist
Reviewed: Barbara Baird Principal District Counsel
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SOUTH COAST AIR QUALITY MANAGEMENT DISTRICT

GOVERNING BOARD
Chairman: WILLIAM A. BURKE, Ed.D.

Speaker of the Assembly Appointee
Vice Chairman: S. ROY WILSON, Ed.D.

Supervisor, Fourth District
County of Riverside

MEMBERS
MICHAEL D. ANTONOVICH
Supervisor, Fifth District
County of Los Angeles
MICHAEL A. CACCIOTTI
Councilmember, City of South Pasadena
Cities of Los Angeles County, Eastern Region

BILL CAMPBELL
Supervisor, Third District
County of Orange
JANE W. CARNEY
Senate Rules Committee Appointee
RONALD O. LOVERIDGE
Mayor, City of Riverside
Cities of Riverside County
JOSEPH K. LYOU, PH.D
Governor’s Appointee

GARY C. OVITT
Supervisor, Fourth District
County of San Bernardino

JAN PERRY
Councilmember, Ninth District
City of Los Angeles Representative
MIGUEL A. PULIDO
Mayor, City of Santa Ana
Cities of Orange County

TONIA REYES URANGA
Councilmember, City of Long Beach
Cities of Los Angeles County, Western Region

DENNIS YATES
Mayor, City of Chino
Cities of San Bernardino County

EXECUTIVE OFFICER
BARRY WALLERSTEIN, D. Env.
1581 of 2287
Table of Contents
TOC - 1 October 2008

TABLE OF CONTENTS
Preface
List of Acronyms
Chapter 1 - Introduction and Executive Summary
Introduction ............................................................................................................... 1-1 Purpose of This Guidance Document........................................................................ 1-3 California Environmental Quality Act and GHGs .................................................... 1-3 Legal Authority ......................................................................................................... 1-6 Contents of This Guidance Document ...................................................................... 1-8 Chapter 2 – Background Information on GHGs
General Background Information on GHGs ............................................................. 2-1 Legislative Background - California ......................................................................... 2-2 Initial Guidance on Evaluating GHGs Pursuant to CEQA........................................ 2-5 Chapter 3 – Interim GHG Significance Threshold Staff Proposal Introduction ............................................................................................................... 3-1 GHG Analysis Considerations .................................................................................. 3-2 Draft Staff Interim GHG Significance Threshold Proposal ..................................... 3-9 Chapter 4 – Considerations When Analyzing GHG Emissions Introduction ............................................................................................................... 4-1 GHG Analysis Recommendations............................................................................. 4-1 Chapter – Conclusion
Introduction ............................................................................................................... 5-1 Future Action Items................................................................................................... 5-1 References
TABLES
Table 2-1: Statutes and Executive Order Approach................................................. 2-9 Table 2-2: Tiered Threshold Options ....................................................................... 2-11 1582 of 2287
Table of Contents
TOC - 2 October 2008
Table 3-1: Global Warming Potential of Kyoto GHGs........................................... 3-4 Table 3-2: 2002-2004 Average Emissions and 2020 Projected Emissions (Business-as-Usual)....................................................................................... 3-6 Table 3-3: URBEMIS Run Results (based on 55 lbs/day NOx or 10 tons/year NOx total Operational and Area Sources) ..................................................................... 3-15 Table 3-4 Comparison of CARB’s and AQMD’s Interim
GHG Significance Thresholds....................................................................... 3-18 Table 5-1: California Air Resources Board GHG Emission Reduction Strategies ...................................................................................................... 5-3 Table 5-2: GHG Emission Reduction Strategies Implemented by CEC and CPUC ........................................................................................ 5-5

FIGURES
Figure 2-1: Global Anthropogenic GHG Emissions............................................... 2-1 Figure 2-2: 2004 GHG Emissions by Sector........................................................... 2-4 Figure 2-3: 1990 GHG Emissions by Sector........................................................... 2-4 Figure 3-1: Revised Staff Proposal #3 Tiered Decision Tree Approach – August 27, 2008......................................................................... 3-11 Figure 3-2: Total Number of AER Facilities and Their Accumulative NG Usage FY 06 – 07 ................................................................................... 3-14 Figure B-1: Initial Staff Proposal – Proposed Tiered Approach – May 28, 2008............................................................................................. B-3 Figure B-2: Revised Staff Proposal #1 Tiered Decision Tree Approach – June 19, 2008............................................................................. B-6 Figure B-3: Proposed Tiered Decision Tree Approach – July 30, 2008................. B-10 Figure B-4: Revised Staff Proposal #3 Tiered Decision Tree Approach – August 27, 2008......................................................................... B-13 APPENDIX A - Working Group Members and Contributors
APPENDIX B – Summaries of Working Group Meetings
1583 of 2287

P R E F A C E
This Draft Guidance Document – Interim CEQA Greenhouse Gas (GHG) Significance Threshold document contains the proposed interim GHG significance threshold, rationale for developing the threshold, and details of the working group meetings and represents a work-in-progress of staff’s efforts to date. This document will be updated as more information becomes available. For the staff recommendation to the Governing Board at the December 5, 2008 public hearing, please refer to Attachment A of Agenda Item Number 31.

Finally, to facilitate identifying changes to this Guidance Document since its release in October 2008, added text is underlined and deleted text is denoted with strikethrough text. 1584 of 2287

L I S T O F A C R O N Y M S A N D A B B R E V I A T I O N S 1585 of 2287
List of Acronyms and Abbreviations
Acronyms and Abbreviations - 1 October 2008
List of Acronyms and Abbreviations
Acronym/
Abbreviation Definition
AB 32 Assembly Bill 32 Global Warming Solutions Act of 2006 AER Annual Emission Reporting
AG Attorney General
ARB Air Resources Board
BACT Best Available Control Technology
BARCT Best Available Retrofit Control Technology
BAU Business as Usual
CAPCOA California Air Pollution Control Officers Association CARB California Air Resource Board
CAT Climate Action Team
CCAR California Climate Action Registry
CEC California Energy Commission
CEQA California Environmental Quality Act
CH4 Methane
CO Carbon Monoxide
CO2 Carbon Dioxide
CPUC California Public Utilities Commission
EIR Environmental Impact Report
EPA U.S. Environmental Protection Agency
FY Fiscal Year
GHG Greenhouse Gas
GGRP Greenhouse Gas Reduction Plan
GP General Plan
GWP Global Warming Potential
IGR Intergovernmental Review
IPCC International Panel on Climate Change
ITE Institute of Transportation Engineers
km Kilometer
LNG Liquefied Natural Gas
MMBTU Million British Thermal Units
MND Mitigated Negative Declaration
MMT CO2e Million Metric Tons Carbon Dioxide Equivalent
MW Megawatts
N2O Nitrous Oxide
ND Negative Declaration
NOX Oxides of Nitrogen
OPR State Office of Planning and Research
PFC Perfluorocarbon
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List of Acronyms and Abbreviations
Acronyms and Abbreviations - 2 October 2008
List of Acronyms and Abbreviations (Concluded)
Acronym/
Abbreviation Definition
PM Particulate Mater
ROG Reactive Organic Gas
RPS Renewable Portfolio Standards
S-3-05 Executive Order S-3-05
SB Senate Bill
SCAQMD South Coast Air Quality Management District
SIP State Implementation Plan
SOX Sulfur Oxides
TAC Toxic Air Contaminants
URBEMIS Urban Emissions Model
VMT Vehicle Miles Traveled
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C H A P T E R 1

I N T R O D U C T I O N A N D E X E C U T I V E S U M M A R Y Introduction
Purpose of This Guidance Document
California Environmental Quality Act and GHGs
Legal Authority
Contents of This Guidance Document
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Chapter 1 – Introduction and Executive Summary
1 - 1 October 2008

INTRODUCTION
The California Environmental Quality Act (CEQA) requires public agencies in California to analyze potential adverse impacts for proposed projects undertaken by a public agency, funded by a public agency, and requiring discretionary approval by a public agency. The fundamental purposes of CEQA are to inform governmental decision-makers and the public about the significant environmental effects of proposed activities, identify ways to avoid or significantly reduce environmental damage, use feasible alternatives or mitigation measures to avoid significant damage, and disclose to the public why a governmental agency approved a project if significant effects are involved (CEQA Guidelines §15002[a]). To disclose potential adverse impacts from a proposed project, pursuant to CEQA lead agencies typically prepare multidisciplinary environmental impact analysis and make decisions based on the analysis regarding the environmental effects of the proposed project (CEQA Guidelines §15002[a]).

In the past, air quality analyses tended to focus on potential adverse impacts from criteria pollutants and toxic air contaminants. Subsequent to the adoption of Assembly Bill (AB) 32 – The California Global Warming Solutions Act of 2006, lead agencies have increasingly faced legal challenges to their CEQA documents for failure to analyze greenhouse gases (GHGs) or making a determination of significance regarding GHG emission impacts.

Greenhouse gases are those gases that have the ability to trap heat in the atmosphere, a process that is analogous to the way a greenhouse traps heat. GHGs may be emitted as a result of human activities as well as through natural processes. As a result of human activities, such as electricity production, vehicle use, etc., GHGs have been accumulating in the earth’s atmosphere at a faster rate than has occurred historically, i.e., prior to the Industrial Age starting approximately 150 years ago. Increasing GHG concentrations in the atmosphere are leading to global climate change.

The Intergovernmental Panel on Climate Change (IPCC) provided the first unequivocal evidence that global climate temperatures are increasing (2007a).

Further, the primary driver of global climate change is increased emissions of GHGs due to human activities. According to the IPCC, there is very high confidence, based on more evidence from a wider range of species, that recent warming is strongly affecting terrestrial, marine, freshwater biological systems.

Carbon dioxide (CO2) is the most important anthropogenic GHG because it comprises the majority of total GHG emissions emitted per year and it is very long-lived in the atmosphere. Annual emissions of CO2 have increased approximately 80 percent between 1970 and 2004. In addition to CO2, other GHG pollutants emitted directly as a result of human activities include methane (CH4), nitrous oxide (N2O) and halocarbons (a group of gases containing fluorine, chlorine or bromine). Without changes in current climate change mitigation policies and related sustainable 1589 of 2287
Chapter 1 – Introduction and Executive Summary
1 - 2 October 2008
development practices, GHG emissions and global climate temperatures will continue to increase.

To prevent or minimize further increases in global temperatures resulting from increases in GHG emissions due to human activities, it is necessary to stabilize the concentration of GHGs in the atmosphere. Stabilizing GHGs in the atmosphere can only occur through reducing GHG emissions. Without further reductions in GHGs, increased global temperatures will surpass humans’ and ecosystems’ ability to adapt to these changing conditions (IPCC, 2007b).

In response to the increasing body of evidence that GHGs will continue to affect global climate, Governor Schwarzenegger issued executive order (EO S-3-05), which established the following greenhouse gas emission reduction targets for California: by 2010, reduce GHG emissions to 2000 levels; by 2020, reduce GHG emissions to 1990 levels; by 2050, reduce GHG emissions to 80 percent below 1990 levels.

Subsequent to the Governor’s issuance of EO S-3-05, the California State Legislature adopted Assembly Bill (AB) 32 – The California Global Warming Solutions Act of 2006. With the adoption of AB 32, the California State Legislature recognized the growing concern regarding changes to global climate resulting from increasing emissions of greenhouse gases (GHGs). AB 32 establishes a cap on statewide greenhouse gas emissions and sets forth the regulatory framework to achieve the corresponding reduction in statewide emissions levels. Specifically, (AB 32) recognizes the serious threat to the “economic wellbeing, public health, natural resources, and the environment of California” that results from global warming.

Consequently, AB 32 mandates a significant reduction in GHGs in order to contribute to efforts to stabilize atmospheric concentrations of GHGs. Under AB 32, greenhouse gases are defined as: carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride.

In general, there is currently an absence of regulatory guidance with regard to analyzing GHG emission impacts in CEQA documents. Similarly, no public agency in California has formally adopted GHG significance thresholds. Recognizing the absence of guidance regarding analyzing and determining the significance of GHGs, the California Air Pollution Control Officers Association (CAPCOA) prepared a White Paper reviewing policy choices, analytical tools, and mitigation strategies for GHGs. In particular, the White Paper identifies a number of options for establishing GHG significance thresholds, but makes no formal recommendation of one approach over another.

Air districts typically act in an advisory capacity to local governments in establishing the framework for environmental review of air pollution impacts under CEQA. This may include recommendations regarding significance thresholds, analytical tools to estimate emissions and assess impacts, and mitigations for potentially significant impacts. Although districts will also address some of these issues on a project-specific basis as responsible agencies, they may provide general guidance to local governments on these issues.
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Because of its expertise in establishing air quality analysis methodologies and comprehensive efforts to establish regional and localized significance thresholds for criteria pollutants, local public agencies have asked South Coast Air Quality Management District (SCAQMD) for guidance in quantifying GHG impacts and recommending GHG significance thresholds to assist them with determining whether or not GHG impacts in their CEQA documents are significant. As a result, SCAQMD staff has received requests from a number of public agencies and other stakeholders to provide guidance on analyzing GHG impacts and establishing a GHG significance threshold. In response to these requests from the various stakeholders, SCAQMD established a stakeholder working group to receive input on establishing a GHG significance threshold. In the meantime, SCAQMD staff has joined many other stakeholders urging CARB to establish a statewide threshold for GHGs. In the absence of a statewide threshold, SCAQMD staff will recommend its interim approach to the Governing Board for consideration and it will also become the SCAQMD’s input to the statewide process.

PURPOSE OF THIS GUIDANCE DOCUMENT
The purpose of this Guidance Document, therefore, is to provide information on GHG legislation relative to CEQA, a brief summary of the Working Group process, development of the resulting staff-recommended interim GHG significance threshold proposal, and how to use it. This Guidance Document also provides information on the SCAQMD’s authority to establish a GHG significance threshold pursuant to CEQA and some background information on GHGs and global climate change. This Guidance Document also discusses future efforts to further refine the interim GHG significance threshold as necessary, includes recommendations for analyzing GHG impacts using current modeling tools, and describes measures to mitigate GHG emission impacts.

CALIFORNIA ENVIRONMENTAL QUALITY ACT AND GHGS
California Attorney General’s Office
Subsequent to adopting AB 32, the California Attorney General’s Office determined that GHG emissions contributing to global climate change also contribute to potential adverse environmental impacts that should be evaluated pursuant to the California Environmental Quality Act (CEQA). The Attorney General’s Office has submitted numerous comment letters to lead agencies on their CEQA documents for failure to analyze GHG emissions, failure to make a significance determination, and failure to implement feasible mitigation measures to reduce GHG emissions to the maximum extent feasible.

For example, the California Attorney General, on behalf of the people of California, filed a legal challenge against the County of San Bernardino for failure to analyze “reasonably foreseeable” GHG emissions in the CEQA document prepared for its 1591 of 2287
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General Plan update. The County reached a settlement with the Attorney General by committing to developing a GHG inventory and a plan for reducing GHGs.

Similarly, the California Attorney General submitted comments on the CEQA document for a refinery in northern California. Although GHG emissions were quantified, the Attorney General cited the failure of the lead agency to make a determination of significance relative to GHG emissions stating, “[E]ven if there is no established threshold in law or regulation, lead agencies are obligated by CEQA to determine significance. Neither CEQA, nor the regulations, authorize reliance on the lack of an agency-adopted standard as the basis for determining that a project’s potential cumulative impact is not significant.” In other words, the absence of a threshold does not in any way relieve lead agencies of their obligations to address GHG emissions from projects under CEQA. By not concluding whether or not a project is significant, the lead agency may be avoiding its responsibility to implement GHG mitigation measures.

Senate Bill (SB) 97 – CEQA: Greenhouse Gas Emissions
In August 2007, Governor Schwarzenegger signed into law Senate Bill (SB) 97 – CEQA: Greenhouse Gas Emissions stating, “This bill advances a coordinated policy for reducing greenhouse gas emissions by directing the Office of Planning and Research (OPR) and the Resources Agency to develop CEQA guidelines on how state and local agencies should analyze, and when necessary, mitigate greenhouse gas emissions.” Specifically, SB 97 requires OPR, by July 1, 2009, to prepare, develop, and transmit to the Resources Agency guidelines for the feasible mitigation of greenhouse gas emissions or the effects of greenhouse gas emissions, as required by CEQA, including, but not limited to, effects associated with transportation or energy consumption. The Resources Agency would be required to certify and adopt those guidelines by January 1, 2010. OPR would be required to periodically update the guidelines to incorporate new information or criteria established by the State Air Resources Board pursuant to the California Global Warming Solutions Act of 2006.

SB 97 also identifies a limited number of types of projects that would be exempt under CEQA from analyzing GHG emissions. Finally, the legislation will be repealed on January 1, 2010.

Office of Planning and Research Technical Advisory
Consistent with SB 97, on June 19, 2008, OPR released its Technical Advisory on CEQA and Climate Change, which was developed in cooperation with the Resources Agency, the California Environmental Protection Agency (Cal/EPA), and the California Air Resources Board (CARB). According to OPR, the Technical Advisory offers the informal interim guidance regarding the steps lead agencies should take to address climate change in their CEQA documents, until CEQA guidelines are developed pursuant to SB 97 on how state and local agencies should analyze, and when necessary, mitigate greenhouse gas emissions.

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type and source. Second, the lead agency must assess whether those emissions are individually or cumulatively significant. When assessing whether a project’s effects on climate change are “cumulatively considerable” even though its GHG contribution may be individually limited, the lead agency must consider the impact of the project when viewed in connection with the effects of past, current, and probable future projects. Finally, if the lead agency determines that the GHG emissions from the project as proposed are potentially significant, it must investigate and implement ways to avoid, reduce, or otherwise mitigate the impacts of those emissions.

SB 375 (Steinberg) Transportation, Land Use, and the California Environmental Quality Act (CEQA)
On September 30, 2008, Governor Schwarzenegger signed into law SB 375 (Steinberg). SB 375 focuses on housing and transportation planning decisions to reduce fossil fuel consumption and conserve farmlands and habitat. This legislation is important to achieving AB 32 goals because greenhouse gas emissions associated with land use, which includes transportation, are the single largest sector of emissions in California. Further, SB 375 provides a path for better planning by providing incentives to locate housing developments closer to where people work and go to school, allowing them to reduce vehicle miles traveled (VMT) every year. The following bullet points summarize some of the main provisions of the bill. • Require the regional governing bodies in each of the state’s major metropolitan areas to adopt, as part of their regional transportation plan, a “sustainable community strategy” that will meet the region’s target for reducing GHG emissions. These strategies would get people out of their cars by promoting smart growth principles such as: development near public transit; projects that include a mix of residential and commercial use; and projects that include affordable housing to help reduce new housing developments in outlying areas with cheaper land and reduce vehicle miles traveled (VMT).
• Create incentives for implementing the sustainable community strategies by allocating federal transportation funds only to projects that are consistent with the emissions reductions.
• Provide various forms of CEQA relief by allowing projects that are shown to conform to the preferred sustainable community strategy through the local general plans (and therefore contribute to GHG reduction) to have a more streamlined environmental review process. Specifically, SB 375 will change CEQA in two ways:
¾ If a development is consistent with the sustainable community’s strategy and incorporates any mitigation measures required by a prior EIR, then the environmental review does not have to consider: a) growth-inducing impacts, or b) project-specific or cumulative impacts from cars on global warming or the regional transportation network.
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¾ A narrowly-defined group of “transit priority projects” will be exempt from CEQA review.

LEGAL AUTHORITY
CEQA Guidelines §15022(a) states that a public agency shall adopt objectives, criteria, and specific procedures consistent with CEQA and these [State] Guidelines for administering its responsibilities under CEQA. CEQA Guidelines §15022(d) states further, “In adopting procedures to implement CEQA, a public agency may adopt the State CEQA Guidelines through incorporation by reference. The agency may then adopt only those specific procedures or provisions described in subsection [15022] (a) which are necessary to tailor the general provisions of the guidelines to the specific operations of the agency.” At the December 11, 1998 Public Hearing the SCAQMD’s Governing Board formally incorporated by reference the State CEQA Guidelines as the implementing guidelines for the SCAQMD’s CEQA program.

Adopting GHG significance thresholds would be consistent with CEQA Guidelines §15022 provision to tailor a public agency’s implementing guidelines by adopting criteria relative to the specific operations of the SCAQMD.

Specifically with regard to thresholds of significance, CEQA Guidelines §15064.7(a) states, "Each public agency is encouraged to develop and publish thresholds of significance that the agency uses in the determination of the significance of environmental effects.” Subsection (b) of the same section states further, “Thresholds of significance to be adopted for general use as part of the lead agency’s environmental review process must be adopted by ordinance, resolution, rule or regulation, and developed through a public review process and be supported by substantial evidence.” Staff’s recommended GHG significance threshold has undergone a public review process as part of stakeholder working group meetings that are open to the public. This Guidance Document provides the substantial evidence relative to the methodology for developing the interim GHG significance threshold.

After completion of the public process, the proposed interim GHG significance threshold will be brought to the SCAQMD’s Governing Board at a public meeting, where it will be considered for adoption by resolution, consistent with CEQA Guidelines §15064.7(b). Staff’s proposed interim GHG significance threshold is a recommendation only for lead agencies and not a mandatory requirement. The GHG significance threshold may be used at the discretion of the local lead agency.

However, if adopted the SCAQMD will use the interim GHG significance threshold for projects where it is the lead agency.

Considerations When Establishing Significance Thresholds No significance thresholds for GHG emissions have been developed, adopted, or endorsed statewide or at the local level1. Air districts have primary authority under

1 In response to comments submitted by the Attorney General’s Office on a dairy project, the San Joaquin Valley Air Pollution Control District (SJVAPCD) identified a significance threshold of 38,477 metric tons of 1594 of 2287
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state law for "control of air pollution from all sources, other than emissions from motor vehicles" (H&SC §40000). The term air contaminant or "air pollutant" is defined extremely broadly, to mean "any discharge, release, or other propagation into the atmosphere" and includes, but is not limited to, soot, carbon, fumes, gases, particulate matter, etc. Greenhouse gases and other global warming pollutants such as black carbon would certainly be included in this definition. The U.S. Supreme Court held in Massachusetts v. EPA 549 U.S. 497 (2009) that greenhouse gases were clearly within the Federal Clean Air Act’s broad definition of air pollutants. Therefore, air districts have the authority to regulate global warming pollutants primarily from nonvehicular sources, while pursuant to AB 32 CARB has authority over a wide range of sources, including vehicular sources.

Appendix G of the CEQA Guidelines provides a checklist of suggested environmental topics that should be addressed in a CEQA document. Questions under each environmental topic area are designed to elicit information on whether a project has the potential to generate significant adverse environmental impacts to that environmental topic area. However, neither the CEQA statutes nor the implementing Guidelines discuss or identify thresholds of significance or particular methodologies for performing an impact analysis. These tasks are left to a lead agency’s judgment and discretion, based upon factual data and guidance from regulatory agencies and other sources where available and applicable.

The determination of whether a project may have a significant effect on the environment calls for careful judgment on the part of the public agency involved, based to the extent possible on scientific and factual data. An ironclad definition of significant effect is not always possible because the significance of an activity may vary with the setting. For example, an activity which may not be significant in an urban area may be significant in a rural area (CEQA Guidelines §15064(b)). Further, in evaluating the significance of the environmental effect of a project, the Lead Agency shall consider direct physical changes in the environment which may be caused by the project and reasonably foreseeable indirect physical changes in the environment which may be caused by the project (§15064(d)). Significance conclusions must be based on substantial evidence, which includes facts, reasonable assumptions predicated upon facts, and expert opinion supported by facts (CEQA Guidelines §15064(f)(5)).

Each public agency is encouraged to develop and publish thresholds of significance that the agency uses in the determination of the significance of environmental effects.

A threshold of significance is essentially a regulatory standard or set of criteria that represent the level at which a lead agency finds a particular environmental effect of a project to be significant. Specifically, a threshold of significance is an identifiable quantitative, qualitative or performance level of a particular environmental effect, noncompliance with which means the effect will normally be determined to be significant

carbon dioxide equivalent per year (MT CO2eq./yr). According to SJVAPCD staff, the agency currently has no plans to formally adopt this significance threshold through a public process. 1595 of 2287
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by the agency and compliance with which means the effect normally will be determined to be less than significant (§15064.7(a)).

Even in the absence of clearly defined significance thresholds for GHG emissions, the California Attorney General has advised that such emissions from CEQA projects must be disclosed and mitigated to the extent feasible whenever the lead agency determines that the project contributes to a significant, cumulative climate change impact.

CONTENTS OF THIS GUIDANCE DOCUMENT
The following subsections provide brief summaries of the chapters contained in this guidance document.

Summaries of Chapter 1
Chapter 1 is the introductory chapter of this document that contains general background information on GHGs and the determination that GHGs must be analyzed in CEQA documents. There is also information on CEQA legislation related to GHGs and global climate change. Finally, the chapter contains information on the legal authority that allows the SCAQMD to adopt significance thresholds for the purpose of determining the severity of impacts analyzed in CEQA documents Summaries of Chapter 2
Chapter 2 contains more detailed background information on GHG emissions relative to global climate change, both internationally and nationally. This chapter also provides more detailed information on legislation to reduce GHG house gas emissions, e.g., Assembly Bill 32 – the Global Warming Solutions Act of 2006, etc. Finally, Chapter 2 contains information on early guidance on evaluating GHG emissions in CEQA documents.

Summaries of Chapter 3
Chapter 3 contains information on the working group established by the SCAQMD to provide feedback to staff on the development of an interim GHG significance threshold. The chapter also includes discussions on considerations in establishing an interim GHG significance threshold and describes the current staff proposal for an interim GHG significance threshold.

Summaries of Chapter 4
Chapter 4 contains general recommendations for analyzing GHG emissions in CEQA documents.
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Summaries of Chapter 5
In Chapter 5 it is assumed that the SCAQMD Governing Board will adopt staff’s proposed interim GHG significance threshold. Therefore, this chapter discusses future action items, including outreach to interested stakeholders, compiling lists of applicable GHG design features and mitigation measures, and periodic review and update, as necessary of the interim GHG significance threshold. 1597 of 2287
C H A P T E R 2

B A C K G R O U N D I N F O R M A T I O N O N G H G S
General Background Information
Legislative Background – California
Initial Guidance on Evaluating GHGs Pursuant to CEQA
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GENERAL BACKGROUND INFORMATION ON GHGS
Intergovernmental Panel on Climate Change
In the last few years information and data have been compiled that demonstrate unequivocally that increases in average global air and ocean temperatures are occurring (IPCC, 2007a). For example, 11 of the last 12 years (1995-2006) rank among the 12 warmest years in the instrumental record of global surface temperature (since 1850). The temperature increase is widespread over the globe and is greater at higher northern latitudes.

Further, increases in sea level are consistent with global warming. For example, global average sea level rose at an average rate of 1.8 [1.3 to 2.3]mm per year over 1961 to 2003 and at an average rate of about 3.1 [2.4 to 3.8]mm per year from 1993 to 2003. According to the IPCC (2007b), there is very high confidence, based on more evidence from a wider range of species, that recent warming is strongly affecting terrestrial, marine, and freshwater biological systems.

One of the major drivers in global climate change has been directly linked to the increase in greenhouse gas (GHG) emissions due to human activities worldwide (Figure 2-1). Carbon dioxide (CO2) is the most important anthropogenic GHG. Annual CO2 emissions have increased approximately 80 percent between 1970 and 2004 (IPCC, 2007b) Figure 2-1
Global Anthropogenic GHG Emissions
Source – IPCC, 2007b: (a) Global annual emissions of anthropogenic GHGs from 1970 to 2004.5 (b) Share of different anthropogenic GHGs in total emissions in 2004 in terms of CO2-eq. (c) Share of different sectors in total anthropogenic GHG emissions in 2004 in terms of CO2-eq. (Forestry includes deforestation.) {WGIII Figures TS.1a, TS.1b, TS.2b}
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containing fluorine, chlorine or bromine). Global increases in CO2 concentrations are due primarily to fossil fuel use, with land-use change providing another significant but smaller contribution. It is very likely that the observed increase in CH4 concentration is predominantly due to agriculture and fossil fuel use. The increase in N2O concentration is primarily due to agriculture (IPCC, 2007).

According to the IPCC (2007), for the next couple of decades global temperatures are expected to rise approximately 0.2o
C per decade under a variety of scenarios. Further,
global temperatures are expected to continue for centuries as a result of human activities due to the time scales associated with climate processes and feedbacks, even if GHG concentrations are stabilized. As a result, based on the current understanding of climatecarbon feedback, model studies show that substantial GHG emission reductions are necessary to avoid substantial increases in global air and ocean temperatures.

LEGISLATIVE BACKGROUND – CALIFORNIA
California has taken a leadership role in not only recognizing the future impacts to global climate change from anthropogenic sources of GHG emissions, but in establishing policies and adopting laws to substantially reduce GHG emissions by 2050. In addition to the GHG legislation related to CEQA described in Chapter 1, California has adopted the following policies and laws that specifically address reducing GHG emissions.

Governor Schwarzenegger’s Executive Order (June 2005)
In June 2005, Governor Arnold Schwarzenegger signed Executive Order (EO) S-3-05, which establishes greenhouse gas emission reduction targets in response to projected increases in global air and ocean temperatures. Specifically, EO S-3-05 establishes the following three GHG emission reduction targets:
• Reduce GHG emissions to 2000 emission levels by 2010; • Reduce GHG emissions to 1990 emission levels by 2020; and • Reduce GHG emissions to 80 percent below 1990 levels by 2050.

Further, EO S-3-05 charges the California Environmental Protection Agency (CalEPA) secretary to coordinate with the Secretary of the Business, Transportation and Housing Agency, Secretary of the Department of Food and Agriculture, Secretary of the Resources Agency, Chairperson of the CARB, Chairperson of the Energy Commission and President of the Public Utilities Commission to develop a Climate Action Plan. EO S-3-05 also charges the Secretary of CalEPA with the oversight of efforts to meet the above GHG emission reduction targets and the responsibility to prepare biannual reports on progress in meeting the GHG emission reduction targets.
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Global Warming Solutions Act of 2006 (Assembly Bill (AB) 32) The Global Warming Solutions Act of 2006 (AB 32) was adopted by the California State Legislature in 2006. AB 32 assigns CARB the responsibilities of monitoring and reducing GHG emissions. Specifically, AB 32 requires CARB to:
• Establish a statewide greenhouse gas emissions cap for 2020, based on 1990 emissions, by January 1, 2008;
• Adopt mandatory reporting rules for significant sources of greenhouse gases by January 1, 2009;
• Adopt a plan by January 1, 2009, indicating how emission reductions will be achieved from significant greenhouse gas sources via regulations, market mechanisms and other actions;
• Adopt regulations by January 1, 2011, to achieve the maximum technologically feasible and cost-effective reductions in greenhouse gas, including provisions for using both market mechanisms and alternative compliance mechanisms; • Convene an Environmental Justice Advisory Committee and an Economic and Technology Advancement Advisory Committee to advise CARB; • Ensure public notice and opportunity for comment for all CARB actions; • To adopt rules for “sources” including non-vehicular; and • Prior to imposing any mandates or authorizing market mechanisms, CARB must evaluate several factors, including but not limited to impacts on California's economy, the environment and public health; equity between regulated entities; electricity reliability; conformance with other environmental laws, and must ensure that the rules do not disproportionately impact low-income communities.

According to the schedule of milestones laid out in AB 32, CARB has made progress in the following areas. Consistent with AB 32’s requirement to establish a GHG emission inventory, in December 2007 CARB adopted the California Greenhouse Gas Emission Inventory. The Inventory accounts for all GHG emissions within the state of California and supports the AB 32 Climate Change Program. Figure 2-2 shows CARB’s inventory for the year 2004. The Inventory also serves as the basis for developing future year GHG emission forecasts necessary to support measure development and Scoping Plan recommendations.

ARB staff has developed a year 2020 “business-as-usual” (BAU) forecast of GHG emissions for use in developing the Draft Scoping Plan. Figure 2-3 shows CARB’s inventory for the year 2020, which is AB 32’s target inventory. 1601 of 2287
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Figure 2-2
2004 GHG Emissions by Sector (Gross Emissions: 484.4 MMT CO2eq.) Source: CARB, 2007
Figure 2-3
1990 GHG Emissions by Sector (Gross Emissions: 433.3 MMT CO2eq.) Source: CARB, 2007
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On December 6, 2007, the Air Resources Board (ARB) approved a regulation for the mandatory reporting of greenhouse gas emissions from major sources, pursuant to AB 32.

The mandatory reporting regulation specifies the types of facilities that must report their GHG emissions, requirements for reporting and estimating the GHG emissions, and requirements for emissions verification. Upon adoption, the CARB Board directed staff to make other conforming modifications, as may be appropriate, based on comments received.

Subsequent to adoption, the mandatory reporting regulation has undergone two sets of modifications.

Consistent with the requirement to develop a scoping plan indicating how GHG emission reductions will be achieved through regulations, market mechanisms, and other actions, the Draft Scoping Plan was released for public review and comment on June 26, 2008, followed by workshops in July and August, 2008.

The Draft Scoping Plan calls for achievable GHG emission reduction in California’s carbon footprint to 1990 levels. Reducing greenhouse gas emissions to 1990 levels means cutting approximately 30 percent from BAU emission levels projected for 2020, or about 10 percent from today’s levels. Key elements of CARB’s preliminary recommendation for reducing California’s greenhouse gas emissions to 1990 levels by 2020 contained in the Draft Scoping Plan include the following:
• Expansion and strengthening of existing energy efficiency programs and building and appliance standards;
• Expansion of the Renewables Portfolio Standard for electricity generation to 33 percent; • Development of a California cap-and-trade program that links with other WCI Partner programs to create a regional market system;
• Implementation of existing State laws and policies, including California’s clean car standards, goods movement measures, and the Low Carbon Fuel Standard; and • Targeted fees to fund the State’s long-term commitment to AB 32 administration.

The Scoping Plan is expected go to the CARB Board for adoption in November, 2008.

INITIAL GUIDANCE ON EVALUATING GHGS PURSUANT TO CEQA
As noted in Chapter 1, both the California Attorney General’s Office and the OPR determined that GHG emissions contributing to global climate change have the potential to generate adverse environmental impacts that should be evaluated pursuant to CEQA. Until recently, however, there has been little or no guidance relative to analyzing GHG emissions in CEQA documents or determining significance. The first explicit guidance was provided by the Association of Environmental Professionals (AEP) in its White Paper on Global Climate Change (AEP, 2007) and the White Paper on CEQA and Climate Change prepared by the California Air Pollution Control Officers Association (CAPCOA, 2008). The content of each of these White Papers is summarized in the following subsections. 1603 of 2287
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Association of Environmental Professionals – White Paper on Global Climate Change AEP’s White Paper (AEP) was one of the first attempts to discuss GHGs in the context of CEQA. The intent of the White Paper was to provide practical, interim information to CEQA practitioners and to help Lead Agencies determine how to address GHGs and global climate change in CEQA documents prior to the development and adoption of guidance by appropriate government agencies. Further, AEP’s White Paper provided a summary of the current regulatory environment surrounding GHG emissions, and the various approaches that a Lead Agency may select in a CEQA document to address the potential impacts of global climate change and a project’s cumulative contribution to GHG. The White Paper described several approaches for addressing GHGs and global Climate Change in CEQA documents, but did not recommend a single approach or methodology, leaving that decision to local Lead Agencies. The AEP White Paper identified eight approaches for analyzing GHGs and global climate change, which are summarized in the following bullet points. • Approach 1 – No Analysis: under this approach the Lead Agency would not mention or discuss GHGs or global climate change.
• Approach 2 – Screening Analysis: under this approach the Lead Agency would establish a process to screen projects and determine that they would not make significant contributions to GHG emissions or GCC and, therefore, would not need to mitigate accordingly.
• Approach 3 – Qualitative Analysis without Significance Determination: this approach involves a qualitative discussion of GHGs and global climate change and potential ways the project will contribute to the generation of GHG emissions, but does not provide any significance conclusions.
• Approach 4 – Qualitative Analysis with Significance Determination: under this approach the Lead Agency would qualitatively discuss GHGs and climate change impacts and conclude that the project impacts are significant. • Approach 5 – Quantitative Analysis without Significance Determination: under this approach the Lead Agency would quantify GHG emissions from the proposed project, but the results are not compared to a quantitative significance threshold. • Approach 6 – Quantitative Analysis with Net Zero Threshold: this approach involves quantifying GHG emissions and using zero net carbon dioxide equivalent increase as the threshold.
• Approach 7 – Quantitative Analysis Relative to California GHG Emission Reduction Strategies: this approach employs both quantitative and qualitative components. The quantitative analysis contains an inventory of project GHG emissions.

The qualitative component involves project compliance with the emission reduction strategies contained in the California Climate Action Team’s (CAT) Report to the Governor, which contains recommendations and strategies to help ensure the targets in Executive Order S-3-05 are met.
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impact analysis and mitigation. A later project that is consistent with the actions, goals, and/or policies in that plan, program, or zoning action need not again evaluate the cumulative impact regarding the project’s GHG contribution to global climate change. In this situation, the later project may use the “partial exemption” provision of Public Resources Code §21083.3 and CEQA Guidelines §15183.

Since the date that the AEP White Paper was finalized (June, 2007), it has become clear that any of the above eight options that do not include quantification of GHG emissions and a determination of significance would be vulnerable to legal challenge. In addition, with the exception of the net zero approach in option 6, none of the options evaluated identify potential GHG significance thresholds. Approaches to developing GHG significance thresholds were specifically addressed in CAPCOA’s White Paper (CAPCOA, 2008).

California Air Pollution Control Officers Association – White Paper: CEQA and Climate Change
The intent of CAPCOA’s White Paper is to serve as a resource for public agencies as they establish procedures for reviewing GHG emissions from projects under CEQA. It considers the application of thresholds and offers three alternative programmatic approaches toward determining whether GHG emissions are significant. Although the White Paper considers an option of not establishing a GHG significance threshold, as already noted this option is not considered to be a viable approach and will not be considered further. Ultimately, the White Paper is intended to provide consistent approaches for public agencies to ensure that GHG emissions are appropriately considered and addressed under CEQA.

The CAPCOA White Paper identifies three programmatic approaches to establishing GHG significance thresholds and also discusses the benefits and problems associated with each approach. Each approach has inherent advantages and disadvantages. The three basic approaches are:
• No significance threshold for GHG emissions (not discussed further); • GHG emissions threshold set at zero; or
• GHG threshold set at a non-zero level, two approaches.

The following subsections briefly summarize two of the three major programmatic approaches developed by CAPCOA.

Zero Threshold
An air district or lead agency may determine that any degree of project-related increase in GHG emissions would contribute considerably to climate change which, therefore, would be considered a significant impact. As a result, the air district or lead agency could adopt a zero-emission GHG threshold. If the zero threshold option is chosen, the lead agency would be required to quantify and mitigate GHG emissions for all projects subject to CEQA, regardless of the size of the project or the availability of GHG reduction measures available to reduce the project’s emissions. Projects that could not meet the zero-emission threshold would be required to undergo an environmental impact report (EIR) CEQA process to disclose the unmitigable significant impact, and develop the justification for a statement of overriding consideration to be adopted by the lead agency. 1605 of 2287
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CAPCOA notes in the White Paper that if an air district or lead agency elects to adopt a zero threshold approach, it should consider the administrative costs and the environmental review system capacity. Some projects that previously would have qualified for an exemption could require further substantial analysis, including preparation of a Negative Declaration (ND), a Mitigated Negative Declaration (MND) or an EIR. Moreover, the trade-offs between the volume of projects requiring review and the quality of consideration given to reviews should be considered. It may also be useful to consider whether meaningful mitigation can be achieved from smaller projects.

Approach 1: Non-Zero Threshold – Statute and Executive Order Approach According to CAPCOA, a non-zero GHG significance threshold could minimize the resources spent reviewing environmental analyses that do not result in real GHG reductions or to prevent the environmental review system from being overwhelmed. The practical advantages of considering non-zero thresholds for GHG significance determinations can fit into the concept regarding whether the project’s GHG emissions represent a “considerable contribution to the cumulative impact” and therefore warrant analysis.

The first non-zero GHG significance threshold approach is based on achieving the objectives of AB 32 or executive order EO S-3-05 and explores four possible options under this scenario. A project would be required to meet the target objectives, or reduce GHG emissions to the target objectives, to be considered less than significant. The options under this approach are variations of ways to achieve the 2020 goals of AB 32 from new development, which is estimated to be about a 30 percent reduction from business-as-usual.

Table 2-1 summarizes the four statute and executive order approaches identified by CAPCOA. SCAQMD staff has identified and included in Table 2-1 potential pros and cons identified for each option.

Approach 2: Non-Zero Threshold – Tiered Threshold Options The second non-zero GHG significance threshold approach is comprised of a number of tiered GHG significance threshold options. Within this option, the CAPCOA White Paper discusses seven variations. The tiered threshold options offer both quantitative and qualitative approaches to setting a threshold, as well as different metrics for establishing the various tiers. Variations range from setting the first tier at zero to second tiers set at defined emission levels or based on the size of a project. This approach would then prescribe a set of GHG mitigation strategies that would have to be incorporated into the project in order for the project to be considered less than significant. CAPCOA notes that some applications of the tiered threshold approach may require inclusion in a General Plan or adoption of enabling regulations or ordinances to render them fully effective and enforceable. The various tiered threshold options are summarized in Table 2-2. SCAQMD staff has identified and included in Table 2-2 potential pros and cons identified for each option. 1606 of 2287
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Table 2 – 1
Statute and Executive Order Approach
Threshold
Number Description of Threshold Pros* Cons*

1.1 Project must reduce emissions compared to
business as usual to be less than significant, two approaches: a. Project must reduce GHG emissions 33 percent compared to business-as-usual (BAU) (2020 target), or b. Project must reduce GHG emissions 80
percent compared to business-as-usual (2050 target).
• Could reduce resource
impacts compared to zero threshold, as not every project would require an EIR • Would achieve GHG
reductions consistent with AB 32
• A single threshold is easier
to apply and understand
• Could be viewed as
setting a de minimis level
• Fewer projects would
trigger significance, thus, less mitigation
• BAU should be defined
by CARB
• BAU may be difficult to
define for all projects

1.2 All new projects must reduce GHG emissions
compared to BAU by a uniform percentage to be considered less than significant, e.g., 50 percent. • Same as 1.1 • May produce greater
percent reduction of GHGs
• Single threshold easier to
apply & understand
• Could produce
substantially greater GHG reductions than 1.1, but may be difficult to achieve • BAU should be defined
by CARB
• BAU may be difficult to
define for all projects
* Pros and cons reflect only SCAQMD staff’s evaluation of the approaches. 1607 of 2287
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Table 2 – 1 (Concluded)
Statute and Executive Order Approach
Threshold
Number Description of Threshold Pros* Cons*

1.3 Projects must reduce GHG emissions
compared to business-as-usual by a uniform percentage based on economic sector to be less than significant, i.e., different reductions required for different market sectors. • Sector-specific approach
may be more appropriate approach
• Would take into account
costs & available control technologies
• Avoids over- or underregulation of GHGs per
sector
• Requires extensive
information on emission inventories
• Requires extensive
information on control technologies
• Difficult to determine
percent reduction by sector
• Because of information
requirements, may be more viable in the long term

1.4 Uniform GHG emission reduction by region.

Regional GHG reduction plan developed consistent with AB32 emission reductions, e.g., reduce GHG emissions 33% or 80% compared to BAU. A project is not significant if its GHG emissions are consistent with plan. • Could tailor GHG
reductions to specific regional needs
• GHG reduction strategies
could be integrated into regional plans
• Would need to establish
GHG regions
• Requires extensive
information on regional emission inventories
• Because of the need to
develop a regional plan, may be a more viable interim approach * Pros and cons reflect only SCAQMD staff’s evaluation of the approaches. 1608 of 2287
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Table 2 – 2
Tiered Threshold Options
Threshold
Number
Description of Threshold Pros* Cons*

2.1 This threshold employs a decision tree
approach. Tier 1, no increase in GHG emissions, not significant (zero threshold). If GHG emissions greater than zero, tier two, use one of the following threshold options. • Tiered approach allows
flexibility by establishing multiple thresholds to cover a wide range of projects • Tier 2 may minimize
administrative burden & costs
• Tiers could be set at
different levels depending on GHGs, size & other project characteristics • Projects exceeding tier 2
must implement mitigation
• Tier 1 may increase
administrative burdens & costs
• There may not be
meaningful mitigation for small projects
• Available mitigation may
consist of purchasing offsets
• EJ concerns of purchasing
offsets because of associated criteria pollutant emissions • Offset markets not well
established

2.2 Establish a quantitative threshold based on
capturing a percentage, e.g., 90%, of future discretionary projects, CAPCOA’s threshold is 900 metric tons CO2eq per year (equivalent to 50 houses or 30,000 square feet of commercial space, i.e., CAPCOA assumes 90% of all projects are this size or greater). Projects less than this would not be significant. • Would capture a larger
percentage of projects in the district than is currently the case • Would exclude small
projects from further GHG analysis
• Single threshold easier to
apply & understand
• Would increase
administrative & cost burden, especially in developing & moderate growth areas • May not be amenable to
industrial projects because of the diversity of these projects • There may not be
meaningful mitigation for small projects
* Pros and cons reflect only SCAQMD staff’s evaluation of the approaches. 1609 of 2287
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Table 2 – 2 (Continued)
Tiered Threshold Options
Threshold
Number
Description of Threshold Pros* Cons*

2.3 This threshold is based on CARB’s proposed
mandatory reporting threshold of 25,000 metric tons of CO2eq per year. Alternatively, use the Market Advisory Committee of 10,000 metric tons of CO2eq per year. Projects less than either would not be significant. • CARB estimates this
threshold would capture 90 % of all industrial projects • Single threshold easier to
apply & understand
• May not be amenable to
industrial projects because of the diversity of these projects • There may not be
meaningful mitigation for small projects

2.4 This approach establishes a GHG threshold based on and analogous to a NOx/VOC criteria pollutant CEQA significance threshold and is established using the following four steps: a. Define NOx/VOC CEQA thresholds in tons per year (e.g., 10 t/yr) b. Define the regional NOx/VOC inventory in tons per year (e.g., annual NOx inventory for 2005 from 2007AQMP ~ 375,585 t/yr) c. Calculate percentage of NOx/VOC inventory the significance threshold represents (10 / 375,585 = 0.00003) to obtain “minimum percentage of regulated inventory” for NOx/VOC. • Single threshold easier to
apply & understand
• Threshold cumbersome to
derive
• Threshold would change
periodically as inventory goes up or down
• Could have widely
divergent thresholds by air basin because of varying inventories * Pros and cons reflect only SCAQMD staff’s evaluation of the approaches. 1610 of 2287
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Table 2 – 2 (Continued)
Tiered Threshold Options
Threshold
Number
Description of Threshold Pros* Cons*

2.4 (Cont.)
d. Define California GHG emission inventory for 2004 in tons CO2eq per year (499 MMT CO2eq). Apply minimum percentage of regulated inventory to California GHG inventory for 2004 to develop a GHG threshold analogous to the CEQA Threshold (e.g., 0.00003 x 499 MMT = 14,970 metric tons CO2eq per year = significance threshold). • •

2.5 Establish quantitative unit-based thresholds based on capturing a percentage, e.g., 90%, of future discretionary projects in specific market sectors (similar to 2.2 above). CAPCOA examples include: • 30,000 square-foot (SF) office =800 metric tons CO2eq per year;
• 30,000 SF retail = 2,500 metric tons CO2eq
per year;
• 30,000 SF supermarket = 43,000 metric
tons CO2eq per year.
• Would capture a larger
percentage of projects in the district than is currently the case • Would exclude small
projects from further GHG analysis
• Single threshold easier to
apply & understand
• Would increase
administrative & cost burden, especially in developing & moderate growth areas • May not be amenable to
industrial projects because of the diversity of these projects • There may not be
meaningful mitigation for small projects
* Pros and cons reflect only SCAQMD staff’s evaluation of the approaches. 1611 of 2287
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Table 2 – 2 (Concluded)
Tiered Threshold Options
Threshold
Number
Description of Threshold Pros* Cons*

2.6 This threshold would include tiered CEQA thresholds based on CEQA’s definition of “projects with statewide, regional or areawide
significance (§15206(b)), which include: • Residential development > 500 dwellings • Shopping center or business establishment employing > 1,000 persons or > 500,000 SF
• Commercial office building employing
>1,000 persons or > 250,000 SF
• Hotel/motel > 500 rooms • Industrial, manufacturing or processing plant or industrial park employing > 1,000 persons or > 600,000 SF • Could capture up to 50%
of all future commercial development
• May capture substantially
less than 50% if future development, resulting less GHG mitigation • Percentage capture of
industrial/manufacturing projects currently unknown

2.7 Efficiency-based thresholds would be based on measurements of efficiency compared to intensity. Must be based on reasonable GHG emissions compared to business-as-usual. • Would benchmark GHG
intensity against target levels of efficiency
• Thresholds established to
provide future foreseeable GHG reductions compared to BAU • Would support AB 32
target objectives
• Would require substantial
data & possibly modeling
• May be more appropriate
as a threshold in the long term
* Pros and cons reflect only SCAQMD staff’s evaluation of the approaches. 1612 of 2287
C H A P T E R 3

I N T E R I M G H G S I G N I F I C A N C E T H R E S H O L D

S T A F F P R O P O S A L
Introduction
GHG Analysis Considerations
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INTRODUCTION
Because GHG emissions affect global climate, some have argued that it may be more appropriate for national or state agencies to establish significance thresholds or GHG emission reduction target objectives. However, no agency has established GHG significance thresholds that could assist Lead Agencies with determining the significance of GHG emissions in CEQA documents. In the absence of statewide guidance on this issue and in response to requests from a variety of stakeholders, the SCAQMD established a GHG Significance Threshold Stakeholder Working Group (Working Group) to establish an interim GHG significance threshold until such time as the state establishes a GHG significance threshold or provides recommended guidance on establishing a GHG significance threshold. Staff’s goal is to reach consensus regarding an interim GHG significance threshold to the extent possible and take the staff proposal to the SCAQMD Governing for consideration and approval.

The Working Group was formed to assist staff’s efforts to develop an interim GHG significance threshold an is comprised of a wide variety of stakeholders including:
state agencies, OPR, CARB, and the Attorney General’s Office; local agencies, city and county planning departments, utilities such as sanitation and power, etc.; regulated stakeholders, industry and industry groups; and organizations, both environmental and professional. Stakeholders were chosen based on their participation in other related stakeholder working groups and their expressed interest in participating in the developing a GHG significance threshold. Working group meetings are open to the public and have been well attended. The members of the Working Group and other interested parties who have requested to be notified of the meetings are listed in Appendix A. Information on the progress of the Working Group, including agendas, overhead presentations, and letters received from the various stakeholders can be found at the following website:
https://www.aqmd.gov/ceqa/handbook/GHG/GHG.html.

Part of the purpose of the Working Group is to provide a forum to solicit comments and suggestions from the various stakeholders to assist SCAQMD staff with developing an interim GHG significance threshold that is consistent with CEQA requirements for developing significance thresholds, is supported by substantial evidence, and provides guidance to CEQA practitioners with regard to determining whether GHG emissions from a proposed project are significant.

SCAQMD staff held the first Working Group meeting in April 2008. Except for September, Working Group meetings have been held on a monthly basis since April.

Brief summaries of each Working Group meeting and the topics and staff GHG significance threshold proposals discussed to date are provided in Appendix B. Staff’s initial proposed has been modified over time based on comments and concerns raised at Working Group meetings or in written comments. The following sections summarize staff’s latest recommended interim GHG significance threshold proposal and some of the concepts necessary to understanding the various components of staff’s 1614 of 2287
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proposal. The latest staff proposal is considered to be a work-in-progress as staff is continuing to solicit further public input and suggestions.

The following subsections briefly summarize the GHG significance threshold design criteria concepts included as part of staff’s proposed interim GHG significance threshold proposal. Following the discussion of design concepts, SCAQMD staff’s current interim proposal is described.

GHG ANALYSIS CONSIDERATIONS
Before discussing quantification methodologies, it is necessary to consider design criteria that establish the parameters upon which the actual GHG analysis is based.

The following subsections include discussions from the Working Group of some of the most important design criteria to be considered when quantifying GHG emissions.

The following topics include some of the most important parameters that should be considered when quantifying GHG emissions and, therefore, should not be considered an exhaustive list of considerations as individual projects may include characteristics that may require additional considerations.

Policy Objective
The overarching policy objective with regard to establishing a GHG significance threshold for the purposes of analyzing GHG impacts pursuant to CEQA is to establish a performance standard or target GHG reduction objective that will ultimate contribute to reducing GHG emissions to stabilize climate change. Full implementation of the Governor’s Executive Order S-3-05 would reduce GHG emissions 80 percent below 1990 levels or 90 percent below current levels by 2050. It is anticipated that achieving the Executive Order’s objective would contribute to worldwide efforts to cap GHG concentrations at 450 ppm, thus, stabilizing global climate.

As described below, staff’s recommended interim GHG significance threshold proposal uses a tiered approach to determining significance. Tier 3, which is expected to be the primary tier by which the AQMD will determine significance for projects where it is the lead agency, uses the Executive Order S-3-05 goal as the basis for deriving the screening level. Specifically, the Tier 3 screening level for stationary sources is base on an emission capture rate of 90 percent for all new or modified projects. A 90 percent emission capture rate means that 90 percent of total emissions from all new or modified stationary source projects would be subject to some type of CEQA analysis, including a negative declaration, a mitigated negative declaration, or an environmental impact.

Therefore, the policy objective of staff’s recommended interim GHG significance threshold proposal is to achieve an emission capture rate of 90 percent of all new or modified stationary source projects. A GHG significance threshold based on a 90 percent emission capture rate may be more appropriate to address the long-term adverse impacts associated with global climate change. Further, a 90 percent emission 1615 of 2287
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capture rate sets the emission threshold low enough to capture a substantial fraction of future stationary source projects that will be constructed to accommodate future statewide population and economic growth, while setting the emission threshold high enough to exclude small projects that will in aggregate contribute a relatively small fraction of the cumulative statewide GHG emissions. This assertion is based on the fact that staff estimates that these GHG emissions would account for less than one percent of future 2050 statewide GHG emissions target (85 MMTCO2eq/yr). In addition, these small projects would be subject to future applicable GHG control regulations that would further reduce their overall future contribution to the statewide GHG inventory
GHG Pollutants
Gases that trap heat in the atmosphere are often called greenhouse gases. The Kyoto Protocol, adopted in December 1997, is an agreement under which industrialized countries will reduce their collective emissions of greenhouse gases by specified percentages, depending on the country, compared to 1990 levels. The goal is to lower overall emissions of six greenhouse gases - carbon dioxide, methane, nitrous oxide, sulfur hexafluoride, hydrofluorocarbons, and perfluorocarbons, averaged over the period of 2008-2012.

Similarly, AB 32 defines GHGs as including the following: carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride (Health and Safety Code, section 38505(g)). The most common GHG that results from human activity is carbon dioxide, followed by methane and nitrous oxide.

Some greenhouse gases such as carbon dioxide occur naturally and are emitted to the atmosphere through natural processes and human activities. Other greenhouse gases (e.g., fluorinated gases) are created and emitted solely through human activities. The principal greenhouse gases that enter the atmosphere because of human activities are:
• Carbon Dioxide (CO2): Carbon dioxide enters the atmosphere through the burning of fossil fuels (oil, natural gas, and coal), solid waste, trees and wood products, and also as a result of other chemical reactions (e.g., manufacture of cement). Carbon dioxide is also removed from the atmosphere (or “sequestered”) when it is absorbed by plants as part of the biological carbon cycle.
• Methane (CH4): Methane is emitted during the production and transport of coal, natural gas, and oil. Methane emissions also result from livestock and other agricultural practices and by the decay of organic waste in municipal solid waste landfills.
• Nitrous Oxide (N2O): Nitrous oxide is emitted during agricultural and industrial activities, as well as during combustion of fossil fuels and solid waste. 1616 of 2287
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• Fluorinated Gases: Hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride are synthetic, powerful greenhouse gases that are emitted from a variety of industrial processes. Fluorinated gases are sometimes used as substitutes for ozone-depleting substances (i.e., CFCs, HCFCs, and halons). Fluorinated gases are typically emitted in smaller quantities, but because they are potent greenhouse gases, they are sometimes referred to as high global warming potential gases (high GWP gases). ¾ Hydrofluorocarbons are manmade chemicals that have historically replaced Chlorofluorocarbons used in refrigeration and semiconductor manufacturing. ¾ Perfluorocarbons are manmade chemicals that are by-products of aluminum smelting and uranium enrichment.
¾ Sulfur hexafluoride is a manmade chemical that is largely used in heavy industry to insulate high voltage equipment and to assist in the manufacturing of cable cooling systems.

GWP is a measure of how much a given mass of greenhouse gas is estimated to contribute to global warming. It is a relative scale that compares the gas in question to the same mass of carbon dioxide (whose GWP is by definition 1). A GWP is calculated over a specific time interval and the value of this must be stated whenever a GWP is quoted or else the value is meaningless. A substance's GWP depends on the time span over which the potential is calculated. A gas which is quickly removed from the atmosphere may initially have a large effect but for longer time periods as it has been removed becomes less important. For the purposes of a CEQA analysis, especially an analysis of operation emissions, the maximum GWP is typically used, regardless of the actual atmospheric lifetime. This approach simplifies the analysis and provides a very conservative analysis, especially for the fluorinated gases. The GWP of the six Kyoto GHGs is shown in Table 3-1.

The SCAQMD staff recommends that a GHG analysis include the six Kyoto GHGs, to the extent emission factors are available primarily because there is more information on these GHGs than other potential GHGs. Other GHGs would be added to the list as scientific information becomes available and agreed to by national or international protocols and agreements.

Table 3-1
Global Warming Potential of Kyoto GHGs
Gas Atmospheric Lifetime GWP
Carbon dioxide (CO2) 50 – 200 1
Methane (CH4) 12 + 3 21
Nitrous oxide (N2O) 120 310
HFC-23 (Hydrofluorocarbons) 264 11,700
HFC-32 5.6 650
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Table 3-1 (Concluded)
Global Warming Potential of Kyoto GHGs
Gas Atmospheric Lifetime GWP
HFC-125 32.6 2,800
HFC-134a 14.6 1,300
HFC-143a 48.3 3,800
HFC-152a 1.5 140
HFC-227ea 36.5 2,900
HFC-236fa 209 6,300
HFC-4310mee 17.1 1,300
CF4 (Perfluorocarbons) 50,000 6,500
C2F6 10,000 9,200
C4F10 2,600 7,000
C6F14 3,200 7,400
Sulfer hexafluoride (SF6) 3,200 23,900
Source: U.S. EPA (http://www.epa.gov/)
Carbon black, a form of particulate air pollution most often produced from biomass burning, cooking with solid fuels and diesel exhaust, may also have a warming effect in the atmosphere. It is estimated that carbon black’s contribution to climate change is second only to carbon dioxide. Carbon black contributes to global warming by absorbing heat while airborne in the atmosphere. Carbon black is of particular concern in the arctic because it settles on ice and snow, reducing its reflectivity and increasing the rate of melting.

Based on a survey of available information, there are little data available for calculating carbon black effects on global warming. As a result, SCAQMD staff is not recommending analyzing carbon black effects on global warming. As information becomes available, staff will reconsider adding carbon black to the list of GHGs to be analyzed in CEQA documents.

Business-As-Usual (BAU)
In CARB’s Scoping Plan (CARB, 2008) CARB states that the BAU case is a representation of what the state of the California economy will be in the year 2020 assuming that none of the measures recommended in the Scoping Plan are implemented. CARB’s projected BAU GHG emissions in 2020 are shown in Table 3-

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Table 3-2
2002-2004 Average Emissions and 2020 Projected Emissions (Business-as-Usual) (MMTCO2E)
Sector 2002-2004 Average
Emissions
Projected 2020
Emissions [BAU]
Transportation 179.3 225.4
Electricity 109.0 139.2
Commercial and Residential 41.0 46.7
Industry 95.9 100.5
Recycling and Waste 5.6 7.7
High GWP 14.8 46.9
Agriculture 27.7 29.8
Forest Net Emissions - 4.7 0.0
Emissions Total 469 596
Source: CARB, 2008 – Scoping Plan, Table 1
CARB’s Scoping Plan states further that continuing increases in global greenhouse gas emissions at BAU rates would result, by late in the century, in California losing 90 percent of the Sierra snow pack, sea level rising by more than 20 inches, and a three to four times increase in heat wave days, flood damage, etc. To avoid future foreseeable environmental impacts to California, the Scoping plan calls for an ambitious but achievable reduction in California’s carbon footprint. Reducing greenhouse gas emissions to 1990 levels means reducing approximately 30 percent from BAU emission levels projected for 2020, or about 15 percent from today’s levels. On a percapita basis, that means reducing our annual emissions of 14 tons of carbon dioxide equivalent for every man, woman and child in California down to about 10 tons per person by 2020.

Although CARB’s Scoping Plan calls for reducing GHG emissions 30 percent from BAU levels, it does not explicitly define BAU. There is, however, a brief definition of BAU in CARB’s GHG inventory document (CARB, 2007). In that document CARB describes BAU as:
• BAU is based on GHG emissions estimates in the absence of policies and reduction measures, and
• BAU is based on forecasted demographic and economic growth.

In its White Paper, CAPCOA provides a more detailed definition of BAU compared to the above definition in CARB’s inventory document. In the White Paper BAU is defined as follows:
• The projection of GHGs into the future based on current technologies and regulations;
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• The adoption of new GHG reduction regulations, e.g., CARB’s Scoping Plan measures, in the future establishes new BAU, i.e., the definition of BAU evolves over time; and
• BAU will normally define the CEQA no project alternative, but does not necessarily form the project baseline.

Based on the above definitions and discussions from the Working Group, SCAQMD staff defines BAU as the following
• Is used to project project’s future emissions (consistent with CAPCOA and CARB definitions), i.e., level from which GHG reductions must occur; • Is based first and foremost on current regulatory requirements (consistent with CAPCOA and CARB definitions);
• Regulatory requirements may determine current technology, e.g., advanced technology may be available, but not required, such as combined cycle gas turbine; • Will normally define the no project alternative (consistent with CAPCOA and CARB definitions); and
• May be used to establish a project’s CEQA baseline, only if consistent with CEQA Guidelines §15125.

The importance of BAU lies not only in the fact that it is a methodology for calculating a project’s future emissions, is also forms the emission level from which GHG emission reductions must occur. SCAQMD staff’s current GHG significance threshold proposal includes the Tier 4 compliance option 1 that establishes a performance standard of reducing GHG emissions 30 percent below the project’s projected BAU emissions through design features and/or mitigation measures. A 30 percent reduction from BAU is consistent with the target objectives of AB 32 and CARB’s Scoping Plan. The intent of the Tier 4 compliance option 1 is to provide a feasible target objective, that will not only contribute to achieving the AB 32 target objective, but will also contribute to achieving the 2050 target of the Governor’s Executive Order S-3-05, which establishes of target objective of reducing GHG emissions 80 percent below 1990 levels or a 90 percent reduction from current BAU estimates.

As recognized by CAPCOA and SCAQMD, BAU will evolve over time as the current regulatory framework changes to implement GHG reduction strategies, either statewide strategies, e.g., CARB’s Scoping Plan, or any future federal strategies.

Evolving BAU creates two issues for the CEQA practitioner. First, staff’s proposed Tier 4 compliance option 1 target objective is unchanged from 30 percent, then over time as BAU changes to incorporate GHG reduction strategies, achieving the target objective will become more difficult. Second, any GHG significance thresholds that rely on BAU will have higher uncertainties because they rely on a constantly changing BAU, which may be difficult to define.
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To resolve some of these issues of an evolving definition of BAU, SCAQMD staff recommends that a statewide definition be developed by CARB that is updated periodically. Until such time as a statewide definition of BAU is developed, the SCAQMD staff will rely on the above definition. Because the SCAQMD’s staff’s GHG significance proposal is considered to be an interim proposal, future updates or revisions to staff’s proposal would also include updates to BAU or the target objective as BAU levels decline over time. It may be that a target objective percent reduction from BAU levels is a short-term GHG threshold proposal and may become less important in the future as other concepts are evaluated and more fully developed.

GHG Source Categories to Analyze
Life Cycle Analysis
CEQA requires that the lead agency analyze direct and indirect impacts from a proposed project, giving due consideration to short-term and long-term effects (CEQA Guidelines 15126.2(a)). In the case of GHG pollutants a systems approach to evaluating the consequences of a particular product, process or activity may be more appropriate because of the long atmospheric lifetimes of the various GHGs (see Table 3-1). One of the most effective ways of evaluating GHGs using a systems approach is through the preparation of a life cycle analysis (LCA).

The goal of a life cycle analysis is to compare the full range of environmental damages assignable to products and services, to be able to choose the least burdensome one.

The term 'life cycle' refers to the concept that a fair, holistic assessment requires the assessment of raw material production, manufacture, distribution, use and disposal including all intervening transportation steps necessary or caused by the product's existence. The sum of all those steps - or phases - is the life cycle of the product.

Performing a life cycle analysis may be difficult for a number of projects or processes because life cycle emission factors may not be well established for many activities or projects and the life cycle process itself may not be known or well-defined.

SCAQMD staff, however, recommends that life cycle analyses be prepared for all projects undergoing a CEQA analysis, as this will produce a more defensible approach. If, however, any component of the life cycle analysis is unavailable, unknown, or not supported by scientific evidence, the lead agency should note such an analysis would be speculative pursuant to CEQA Guidelines §15145 and terminate discussion of that impact.

Direct/Indirect Impacts
Consistent with CEQA, indirect and direct impacts of the project, typically within California, are required to be analyzed in the CEQA document for a proposed project.

The analysis of direct GHG impacts is relatively straightforward as onsite GHG sources or directly related offsite GHG sources, such as worker commute trips, are generally readily identifiable. Indirect GHG emission sources are less obvious, but may include some of the sources identified in the following paragraphs. In general, 1621 of 2287
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for most projects information on direct and indirect emissions may be available, rather than a full life-cycle analysis of emissions. The lead agency has typically been expected to address emissions that are closely related and within the capacity of the project proponent to control and/or influence.

Direct Impacts - are primary effects that are caused by a project and occur at the same time and place, such as emissions from boilers, heaters, or other onsite emissions sources. Direct impacts generated by a project may include offsite sources directly related to the project such as emissions from worker commute trips, haul truck trips to import raw materials and/or export finished products or other goods.

Direct GHG emission impacts will include both construction and operation activities.

Because impacts from construction activities occur over a relatively short-term period of time, they contribute a relatively small portion of the overall lifetime project GHG emissions. In addition, GHG emission reduction measures for construction equipment are relatively limited. Therefore, SCAQMD staff is recommending that construction emissions be amortized over a 30-year project lifetime, so that GHG reduction measures will address construction GHG emissions as part of the operational GHG reduction strategies.

Indirect Impacts - The CEQA Guidelines define indirect impacts as the following: an indirect physical change in the environment…which is not immediately related to the project, but which is caused indirectly by the project. If a direct physical change in the environment in turn causes another change in the environment, then the other change is an indirect change in the environment (CEQA Guidelines §15064 (d)(2)). Indirect or secondary effects may include growth-inducing effects and other effects related to induced changes in the pattern of land use, population density, or growth rate, and related effects on air and water and other natural systems, including ecosystems (CEQA Guidelines §15358)(a)(2)).

DRAFT STAFF INTERIM GHG SIGNIFICANCE THRESHOLD

PROPOSAL
As indicated by the evolution of the staff proposal over time, SCAQMD has generally recommended a tiered decision tree approach to establishing a GHG significance threshold. In CAPCOA’s White Paper, eight of the 12 significance threshold options are based on a tiered threshold approach (see also Table 2-2 in Chapter 2). A tiered GHG significance threshold approach is an appealing approach because it provides flexibility in determining whether or not GHG emissions from a project are significant typically using a single methodology to establish various tiers that can be based on the physical size of the project, land use type, or other characteristics. The tiered approach envisioned by SCAQMD staff would require quantification of GHG emissions for all projects that are subject to CEQA and quantification of the GHG reduction effectiveness of design parameters incorporated into the project and any mitigation measures imposed by the lead agency. It may even be necessary to 1622 of 2287
Chapter 3 – Interim GHG Significance Threshold Staff Proposal 3 - 10 October 2008
quantify GHG emissions, if any, for projects that would otherwise qualify for a categorical exemption to document that no “cumulative impact of successive projects of the same type in the same place, over time is significant” (CEQA Guidelines §15300.2(b), or that there is no “reasonable possibility that the activity will have a significant effect on the environment due to unusual circumstances.” (CEQA Guidelines §15300.2(c)).

The CAPCOA White Paper also includes a discussion of a decision tree approach to tiering. Instead of using a single methodology to establish tiers, a decision tree approach would use multiple methodologies to demonstrate significance for a broad range of projects/plans that may be difficult to address using a single GHG significance threshold methodology. Using a decision tree approach promotes even greater flexibility in determining significance for a variety of project types.

At the August 27, 2008 Working Group meeting #5, staff presented the revised interim GHG significance proposal #3, which included a tiered decision tree approach. Unlike the decision tree approach discussed in CAPCOA’s White Paper, some tiers include multiple approaches for determining whether a project’s GHG emissions are significant, rather than using a single different methodology for each tier.

For the purposes of determining whether or not GHG emissions from affected projects are significant, project emissions will include direct, indirect, and, to the extent information is available, life cycle emissions during construction and operation.

Construction emissions will be amortized over the life of the project, defined as 30 years, added to the operational emissions, and compared to the applicable interim GHG significance threshold tier. The following bullet points describe the basic structure of staff’s tiered GHG significance threshold proposal for stationary sources.

The components of revised staff proposal #3 are described in the following paragraphs and shown graphically in Figure 3-1.
• Tier 1 – consists of evaluating whether or not the project qualifies for any applicable exemption under CEQA. For example, SB 97 specifically exempts a limited number of projects until it expires in 2010. If the project qualifies for an exemption, no further action is required. If the project does not qualify for an exemption, then it would move to the next tier.
• Tier 2 – consists of determining whether or not the project is consistent with a GHG reduction plan that may be part of a local general plan, for example. The concept embodied in this tier is equivalent to the existing concept of consistency in CEQA Guidelines §§15064(h)(3), 15125(d), or 15152(a). The GHG reduction plan must, at a minimum, comply with AB 32 GHG reduction goals; include emissions estimates agreed upon by either CARB or the SCAQMD, have been analyzed under CEQA, and have a certified Final CEQA document. Further, the GHG reduction plan must include a GHG emissions inventory tracking mechanism; process to monitor progress in achieving GHG emission reduction targets, and a commitment to remedy the excess emissions if AB 32 goals are not met (enforcement).
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Chapter 3 – Interim GHG Significance Threshold Staff Proposal 3 - 11 October 2008
Figure 3-1
Revised Staff Proposal #3 Tiered Decision Tree Approach – August 27, 2008 1624 of 2287
Chapter 3 – Interim GHG Significance Threshold Staff Proposal 3 - 12 October 2008
If the proposed project is consistent with the local GHG reduction plan, it is not significant for GHG emissions. If the project is not consistent with a local GHG reduction plan or there is no approved plan, the GHG reduction does not include all of the components described above, or there is no adopted GHG reduction plan, the project would move to tier 3.
• Tier 3 – attempts to identify small projects that would not likely contribute to significant cumulative GHG impacts. However, because of the magnitude of increasing global temperatures from current and future GHG emissions, staff is recommending that all projects must implement some measure or measures to contribute to reducing GHG emissions. Therefore, Tier 3 includes a requirement that all residential/commercial projects with GHG emissions less than the screening level must include efficiency components that reduce a certaingo X percentage beyond the requirements of Title 24 (Part 6, California Code of Regulations), California's energy efficiency standards for residential and nonresidential buildings. Project proponents would also have to reduce by a specified percentage electricity demand from water use, primarily electricity used for water conveyance.

The most recentlyA past recommended screening level proposed by staff was 6,500 MTCO2eq./year. This screening level was derived using the SCAQMD’s existing NOx operational threshold as a basis. The daily NOx operational significance threshold, 55 pounds per day was annualized, which results in 10 tons of NOx per year.

Staff initially considered and then rejected a bifurcated screening level, that is one screening level for residential and commercial projects and a different screening level for industrial projects based on the URBEMIS modeling runs used to derive the 6,500 MTCO3eq/yr screening level because GHG emissions from industrial were of the same magnitude as the GHG emissions from residential and commercial projects. Staff has reconsidered the bifurcated screening level approach as there is a more scientific basis for deriving the different screening levels.

SCAQMD staff is now recommending a bifurcated screening level approach to address two greatly differing project types: industrial projects as opposed to residential and commercial projects (which are largely indirect sources). The former category typically contains stationary source equipment whose emissions are largely permitted or regulated by the SCAQMD; whereas the latter category is mostly residential, commercial (may also include industrial) building structures that attract or generate mobile source emissions. In light of the GHG reductions needed to stabilize the climate while considering implementation resource requirements, the policy objective used to establish the screening thresholds is to capture projects that represent approximately 90 percent of GHG emissions from new sources. The following paragraphs describe the steps taken to derive the screening threshold values.
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Chapter 3 – Interim GHG Significance Threshold Staff Proposal 3 - 13 October 2008
Industrial Projects: Since the majority of GHG emissions in the district are comprised of CO2 emissions from burning natural gas rather than other types of fossil fuel, staff compiled reported annual natural gas consumption for 1,297115 permitted facilities for 2006-2007 and rank-ordered the facilities to estimate the 90th percentile of the cumulative natural gas usage for all permitted facilities.

Operators of these facilities are required to report their emissions and associated throughput under the SCAQMD’s Annual Emission Reporting (AER) Program if any of their criteria pollutant emissions exceed four tons per year (100 tons per year for CO) or if the facility has any reportable air toxics emission. Figure 3-2 shows that approximately 10 percent of facilities evaluated comprise more than 90 percent of the total natural gas consumption, which corresponds to 10,000 metric tons per year (tpy) of CO2 emissions. This value represents a boiler with a rating of approximately 27 million British thermal units per hour (mmbtu/hour) of heat input, operating at an 25 80 percent capacity factor. If the screening threshold of 10,000 MTCO2eq./yr is implemented, based on the permitting activities for 2006- 2007 it will result in at least 31 additional MNDs or EIRs being prepared by the SCAQMD as the lead agency unless another tier option is selected to demonstrate no significant impacts for GHG emissions. It should be noted that this analysis did not include other possible GHG pollutants such as methane, N2O; a life-cycle analysis; mobile sources; or indirect electricity consumption. Therefore, under a 10,000 MTCO2eq./yr screening level more projects would be required to go through an MND or EIR environmental analysis than is currently the case.

Furthermore, when the SCAQMD acts as a lead agency, the stationary source equipment employed as part of the proposed project typically must comply with BACT or other SCAQMD rules, regulations, programs that require reducing criteria pollutants or air toxics. Therefore, staff is proposing to replace the 6,500 MTCO2/yr screening level with the 10,000 MTCO2eq/yr as the screening level in tier III for industrial projects when the SCAQMD is the lead agency for the project.

Residential and Commercial Projects: To achieve the same 90 percent GHG emission capture rate for this segment of projects GHG emissions from residential and commercial sectors were compared to the GHG emissions from the industrial sector including the in-state power plants. The draft AB32 scoping plan indicates that based on statewide 2002-2004 average GHG emissions, the residential and commercial sectors account for approximately nine percent of the total statewide GHG inventory, while the industrial sector (including instate power plants) accounts for approximately 30 percent of the statewide GHG emission inventory.

The inventory methodology for both sectors includes only on-site energy use, consistent with the staff approach taken in deriving the 10,000 tpy threshold.

Assuming similar emission characteristics also exist for the residential and commercial sector (i.e., large residential or commercial projects, although fewer in numbers, contribute substantially more to the total emissions), it is estimated that at a threshold of approximately 3,000 MTCO2eq/yr emissions (10,000 x (9 percent / 30 percent)) would capture 90 percent of the GHG emissions from new residential or commercial projects. A series of sensitivity analyses was performed by the staff using URBEMIS to assess the likely project size for 3,000 MTCO2eq/yr emissions.

Table 3-3 illustrates various projects by size and shape. 1626 of 2287
Chapter 3 – Interim GHG Significance Threshold Staff Proposal 3 - 14 October 2008
Figure 3-2
Total Number of AER Facilities and Their Accumulative Reported NG Usage FY 06-07
0 50000
100000150000200000250000300000350000
1 66 131 196 261 326 391 456 521 586 651 716 781 846 911 976 1041 1106 1171 1236 Number of AER Facilities
Accumulative NG Usage (mmscf) Accum. Usage
CO2 =9,738 MTNOx = 6.16 tp
y
CO2 =39,957 MTNOx = 13.25 tp
y
90% of NG usage 80% of NG usage
Total # of AER Facilities = 1,297Total # of Fac. accounting for 90% of the total NG usage = 143 (thus, the remaining 10% of total NG usage is from 1,154 facilties) Total # of Fac. accounting for 80% of the total NG usage = 45 (which is a subset of the 143) MT = Metric Tonstpy = Tons per year
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Chapter 3 – Interim GHG Significance Threshold Staff Proposal 3 - 15 October 2008
Table 3-3
URBEMIS Run Results for Residential/Commercial Projects Emitting Approximately 3,000 MTCO2 per Year* Area Source Emissions Operational Emissions TOTAL
Weighted Avg
Trip Rate Size
CO2
(tons/year)
CO2
(MT/year)
CO2
(tons/year) CO2 (MT/year) CO2 (MT/year)
Res - Single Unit 19.54 80 units 326.86 297.15 3003.56 2730.51 3027.65 Res - Apt 9.17 175 units 422.70 384.27 2971.95 2701.77 3086.05 Comm - Office 6.02 265,000 ft2 387.41 352.19 2961.75 2692.50 3044.69 Comm - Bank 206.22 9,500 ft2 14.38 13.07 3192.90 2902.64 2915.71

19.54 35 units Single/Apt 9.17 100 units 379.59 345.08 2964.82 2695.29 3040.37

6.02 170,000 ft2 Office/Bank
206.22 3,400 ft2 254.19 231.08 3042.71 2766.10 2997.18

6.02 135,000 ft2 Office/Single 19.54 40 units 355.13 322.85 2956.32 2687.56 3010.41 6.02 135,000 ft2 Office/Apt 9.17 85 units 403.19 366.54 2952.34 2683.95 3050.48 206.22 3,700 ft2 Bank/Single 19.54 50 units 202.81 184.37 3052.93 2775.39 2959.76 206.22 4,000 ft2 Bank/Apt 9.17 100 units 248.12 225.56 3042.64 2766.04 2991.60

19.54 20 units
Single/Apt/Office 9.17 65 units

6.02 100,000 ft2
382.60 347.82 2945.26 2677.51 3025.33

19.54 20 units
Single/Apt/Bank 9.17 65 units
206.22 3,550 ft2
241.78 219.80 3020.76 2746.15 2965.95
Avg CO2 (MT/year): 3009.60
*Offsite electricity use, water use, or other potential life cycle emissions not included. 1628 of 2287
Chapter 3 – Interim GHG Significance Threshold Staff Proposal 3 - 15
As shown in Table 3-3, this threshold would represent a residential development of about 70 single-family dwelling units. It should be noted that the sensitivity analysis did not include GHG emissions from electricity use and water use. As a result, similar to the earlier discussion of industrial projects, this screening level of 3,000 MTCO2eq/yr could capture development projects less than 70 single-family dwelling units.

In CAPCOA’s White Paper, it is suggested that a thresholds of 900 MTCO2eq/yr would capture 90 percent of all development projects, which should translate into at least 90 percent of GHG emissions from the residential and commercial sectors2 .

According to CAPCOA 900 MTCO2eq/yr equates to approximately 50 singlefamily dwelling units. This information appears to corroborate the SCAQMD staff’s finding that the policy objective of capturing 90 percent of all GHG emissions for this region can be achieved with a screening level of 3000 MTCO2eq/yr. Therefore, staff is recommending that this value be used by lead agencies for residential and commercial developments, including industrial parks, warehouses, etc.
• Tier 4 – Decision Tree Options: consists of three decision tree options to demonstrate that a project is not significant for GHG emissions. The three compliance options are as follows.

Compliance Option 1 – the lead agency would calculate GHG emissions for a project using a BAU methodology. Once GHG emissions are calculated, the project proponent would need to incorporate design features into the project and/or implement GHG mitigation measures to demonstrate a 30 percent reduction from BAU. Although a 30 percent reduction below BAU is consistent with the target objectives of AB 32, it will continue to reduce GHG emissions beyond 2020, thus, contributing to GHG reductions pursuant to the Governor’s Executive Order S-3- 05 (a 90 percent reduction compared to current GHG emissions). A 30 percent reduction is also considered to be an achievable GHG reduction target based on current technologies.

Compliance Option 2 – this option consists of early compliance with AB 32 through early implementation of CARB’s Scoping Plan Measures. The intent of this compliance option is to accelerate GHG emission reductions from the various 2 Although the CAPCOA White Paper implies that 900 metric tons per year equates to a 90 percent capture rate, there is no explicit information provided in the White Paper that demonstrates this correlation. Indeed, the CAPCOA authors state that 900 metric tons, which represents approximately 50 residential units, corresponds to widely divergent capture rate percentile rankings depending on the project location (see discussion on page 43 of the White Paper). Percentile rankings were based on a survey of four cities in California. A project of 900 metric tons per year representing a 90 percent capture rate appears to be a working assumption for which there appears to be no factual basis. Further, although not explicitly stated, it is assumed that the 900 metric tons were derived using the URBEMIS2007 model. It should be noted that that the URBEMIS2007 model only quantifies CO2 emissions and direct emissions primarily from on-road mobile sources.

It does not capture other GHG pollutants or indirect GHG emissions such as emissions from energy generation, water conveyance, etc. Therefore, it is likely that a 50-unit residential project would actually generate higher GHG emissions than 900 metric tons per year. 1629 of 2287
Chapter 3 – Interim GHG Significance Threshold Staff Proposal 3 - 16 October 2008
sectors subject to CARB’s Scoping Plan to eliminate GHG emission, especially for those GHGs that have a long atmospheric lifetime such as CO2, sulfur hexafluoride, etc., to minimize future projected impacts to California from global climate change.

Compliance Option 3 – this compliance option consists of establishing sectorbased performance standards. For example, it may be possible to use the 1990 inventory required under AB 32 to establish an efficiency standard such as pounds per person, pounds per worker, pounds per square feet, pounds per item manufactured, etc. When calculating GHG emissions from a project, if they are less than the established efficiency standard the project would not be significant relative to GHG emissions, while projects exceeding the efficiency standard would be significant.

If the lead agency or project proponent cannot achieve the performance standards on any of the compliance options in Tier 4, GHG emissions would be considered significant.
• Tier 5 – under this tier, the lead agency would quantify GHG emissions from the project and the project proponent would implement offsite mitigation (GHG reduction projects) or purchase offsets to reduce GHG emission impacts to less than the proposed screening level. In addition, the project proponent would be required to provide offsets for the life of the project, which is defined as 30 years. If the project proponent is unable to obtain sufficient offsets, incorporate design features, or implement GHG reduction mitigation measures to reduce GHG emission impacts to less than the screening level, then GHG emissions from the project would be considered significant.

Since it is currently uncertain how offsite mitigation measures, including purchased offsets, interact with future AB 32 Scoping Plan measures, the AQMD would allow substitution of mitigation measures that include an enforceable commitment to provide mitigation prior to occurrence of emissions and to prevent mitigating the same emissions twice.

Mitigation Preference – If a project generates significant adverse impacts, CEQA Guidelines §15126.4 requires identification of mitigation measures to minimize potentially significant impacts. Because GHG emissions contribute to global change, mitigation measures could be implemented locally, nationally, or internationally and still provide global climate change benefits. Because reducing GHG emissions may provide co-benefits through concurrent reductions in criteria pollutants, when considering mitigation measures when the AQMD is the lead agency under CEQA, staff will implement mitigation measures that are real, quantifiable, verifiable, and surplus in the following order of preference. ¾ Incorporate GHG reduction features into the project design, e.g., increase a building’s energy efficiency, use materials with a lower global warming potential than conventional materials, purchase building materials locally, etc. ¾ Implement onsite measures that provide direct GHG emission reductions onsite, e.g., replace onsite combustion equipment (boilers, heaters, steam 1630 of 2287
Chapter 3 – Interim GHG Significance Threshold Staff Proposal 3 - 17 October 2008
generators, etc.) with more efficient combustion equipment, replace existing high global warming potential refrigerants with low global warming refrigerants, eliminate or minimize fugitive emissions, etc. ¾ Implement neighborhood mitigation measure projects that could include incentives for installing solar power, increasing energy efficiency by exceeding Title 24 building standards through replacing low efficiency water heaters with high efficiency water heaters, increasing building insulation, using fluorescent bulbs, replacing old inefficient refrigerators with efficient refrigerators using low global warming potential refrigerants, etc. ¾ Implement in-district mitigation measures such as any of the above identified GHG reduction measures; reducing vehicle miles traveled (VMT) through greater rideshare incentives, transit improvements, etc. ¾ Implement in-state mitigation measures, which could include any of the above measures.
¾ Implement out of state mitigation measure projects, which may include purchasing offsets if no other options are available.

CARB’s Interim GHG Significance Threshold Proposal
In October 2008 CARB released its interim GHG significance threshold proposal and held a public workshop on October 27, 2008. CARB’s threshold is considered to be an interim threshold because CARB staff intends to periodically review and change its threshold proposal as necessary. CARB’s Preliminary Draft Staff Proposal (Proposal) states that non-zero GHG significance thresholds can be supported by substantial evidence. Futher, different GHG significance thresholds may be established for different sectors. Therefore, as part of its initial interim GHG significance threshold proposal CARB is proposing two separate GHG significance thresholds, one for new industrial projects and another for residential/commercial projects subject to CEQA. CARB’s proposal uses a tiered approach (see Table 3-4).
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Chapter 3 – Interim GHG Significance Threshold Staff Proposal 3 - 18 October 2008
Table 3-4
Comparison of CARB’s and AQMD’s Interim GHG Significance Thresholds Approaches Stationary/Industrial Sector Projects Residential/Commercial Sector Projects CARB AQMD CARB AQMD (Not Recommended at
this Time)
Policy
Objective
Capture 90% of statewide
stationary project emissions
Capture 90% of district wide
GHG emissions (industrial)
Capture X% of statewide
residential/commercial project emissions
Capture 90% of district wide residential/commercial project GHG emissions Exemption Apply applicable
exemption
Apply applicable exemption Apply Applicable Exemption Apply Applicable Exemption Regional GHG
Reduction
Plan
N.A. Project Consistent with
Applicable GHG Reduction Plan with GHG inventorying, monitoring, enforcement, etc.

Project Consistent with
Applicable GHG Reduction Plan with GHG inventorying, monitoring, enforcement, etc.

Project Consistent with Applicable GHG Reduction Plan with GHG inventorying, monitoring, enforcement, etc.

Thresholds Project < 7,000
MTCO2eq/yr & meets construction & transportation performance standards GHG emissions from
industrial project is < 10,000 MTCO2eq/yr, includes
construction emissions
amortized over 30 years & added to operational GHG emissions Project meets construction &
operation performance tandards, e.g., energy, water use, waste & ransportation & < X MTCO2eq/yr Project is < 3,000 MTCO2eq/yr & exceeds Title 24 Energy Efficiency Standards by X%, if applicable – construction emissions amortized over 30 years & added to operational GHG emissions Performance
Standards
See above NA See above 3 Compliance Options: 1)
Reduce GHG emissions 30% below BAU; 2) Early Implement AB 32 Measure; 3) Comply with Performance Standard Offsets Offsite substitution allowed Implement offsite mitigation for life of project, i.e., 30 years, with mitigation preference Offsite substitution allowed Implement offsite mitigation for life of project, i.e., 30 yearswith mitigation preference Determination GHG emissions significant,
EIR is prepared, if meeting none of the above
GHG emissions significant,
EIR is prepared, if meeting none of the above
GHG emissions significant,
EIR is prepared, if meeting none of the above
GHG emissions significant, EIR is prepared, if meeting none of the above 1632 of 2287
Chapter 3 – Interim GHG Significance Threshold Staff Proposal 3 - 19
CARB’s interim GHG significance threshold for industrial sources was developed to capture “the vast majority (~90% statewide) of the GHG emissions from new industrial projects being subject to CEQA’s requirement to impose feasible mitigation.” According to CARB’s Proposal, CARB staff used data from a survey of industrial boilers performed by the Oak Ridge National Laboratory in which it was concluded that small boilers with an input capacity of 10 MMBtu/hr corresponded to 93 percent of total industrial boiler input capacity, or 4,660 MTCO2e/yr. Using this result and accounting for process losses, purchased electricity, and water usage and wastewater discharge, CARB staff is recommending 7,000 MTCO2eq/yr as a GHG significance threshold for industrial projects. The following bullet points summarize CARB’s proposed interim GHG significance threshold for industrial sources.
• Box 1 – Apply any applicable categorical or statutory exemptions. If the project does not qualify for an exemption, move to Box 2. • Box 2 – The industrial project must meet both of the following performance standards or equivalent mitigation measures to be deemed insignificant for GHGs:
¾ Construction – Project must meet an interim performance standard for construction- related emissions (performance standard not yet defined).
¾ Transportation – Project must meet an interim performance standard for transportation (performance standard not yet defined).

AND
¾ Project with mitigation will emit no more than 7,000 MTCO2eq/yr. If the project does not qualify for either of the performance standards or exceeds 7,000 MTCO2eq/yr, move to Box 3.
• Box 3 – Project is deemed significant and an EIR must be prepared. • CARB’s Preliminary Draft Proposal for Residential and Commercial projects is summarized in the following bullet points.
• Box 1 – Apply any applicable categorical or statutory exemptions. If the project does not qualify for an exemption, move to Box 2. • Box 2 – Project complies with a previously approved plan that addresses GHG emissions and must: include a GHG reduction target consistent with AB 32; be consistent with transportation-related target adopted by CARB pursuant to SB 375; include a GHG inventory and mechanism for monitoring GHG emissions; include enforceable GHG requirements; include a mechanism for periodic updates to plan; and have a certified CEQA document. If the project is 1633 of 2287
Chapter 3 – Interim GHG Significance Threshold Staff Proposal 3 - 20 October 2008
consistent with a GHG plan that includes all of these elements, it is presumed to be insignificant for GHGs. If the project is not consistent with a GHG plan or there is no adopted GHG plan that includes all of the above elements, move to Box 3.
• Box 3 – The residential/commercial project must meet all of the following performance standards or equivalent mitigation measures to be deemed insignificant for GHGs:
¾ Construction – Project must meet an interim performance standard for construction- related emissions (performance standard not yet defined).
¾ Operations – Project must meet the following performance standards:
energy use performance standard defined in CEC’s Tier II Energy Efficiency goal; an interim performance standard for water use (performance standard not yet defined); an interim performance standard for waste (performance standard not yet defined); and an interim performance standard for transportation (performance standard not yet defined).

AND
The project with performance standards or equivalent mitigation will emit no more than X MTCO2eq/yr (criterion to be developed). If the project does not qualify for any one of the performance standards or exceeds X MTCO2eq/yr, move to Box 4. • Box 4 – Project is deemed significant and an EIR must be prepared.

For a detailed description of CARB’s interim GHG significance threshold proposal, refer to the following URL:
http://www.arb.ca.gov/cc/localgov/ceqa/meetings/102708/prelimdraftproposal1024

08.pdf.

CARB is currently accepting comments on its Draft Proposal and has scheduled a second public workshop on December 9, 2008. CARB staff currently anticipates taking their proposal to their Board in February 2009.
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C H A P T E R 4

C O N S I D E R A T I O N S W H E N A N A L Y Z I N G

G H G E M I S S I O N S
Introduction
GHG Analysis Recommendations

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Chapter 4 – Considerations When Analyzing GHG Emissions 4 - 1 October 2008

INTRODUCTION
As noted in Chapter 1, on June 19, 2008, OPR, in collaboration with the California Resources Agency, the California Environmental Protection Agency and the California Air Resources Board, released a Technical Advisory containing informal guidance for public agencies as they address the issue of climate change in their CEQA documents. With regard to analyzing GHG emission impacts OPR states, “Each public agency that is a lead agency for complying with CEQA needs to develop its own approach to performing a climate change analysis for projects that generate GHG emissions. A consistent approach should be applied for the analysis of all such projects, and the analysis must be based on best available information… Lead agencies should determine whether greenhouse gases may be generated by a proposed project, and if so, quantify or estimate the GHG emissions by type and source.” Other than this general advice, the Technical Advisory does not provide explicit details for quantifying GHG emissions.

CAPCOA’s White Paper provides a comprehensive discussion of modeling tools that are currently available for analyzing GHG emissions3
. As indicated in the White
Paper, no one model is currently available that is capable of estimating all of a project’s direct and indirect GHG emissions. It is likely, however, that the Urban Emissions (URBEMIS) Model will be the most commonly used model for calculating GHG emissions because it currently calculates CO2 emissions (in addition to criteria pollutant emissions) during both construction and operation of proposed projects, it is publicly available, and already widely used in California. Statewide use of the URBEMIS model would provide consistency throughout California with regard to quantifying GHG emissions. For a list of currently available models that calculate GHG emissions and summaries of the capabilities, advantages, and disadvantages of each model refer to Table 10 on pages 75 through 78 in the CAPCOA White Paper.

The purpose of this chapter is to provide more explicit guidance to CEQA practitioners with regard to quantifying GHG emissions than OPR’s Technical Advisory, while building on the information provided CAPCOA’s White Paper.

GHG ANALYSIS RECOMMENDATIONS
Direct/Indirect Impacts
As noted in Chapter 3 of this Guidance Document, consistent with CEQA, indirect and direct impacts of the project, typically within California, are required to be analyzed in the CEQA document for a proposed project. The analysis of direct GHG impacts is

3 For maximum transparency with regard to quantifying GHG emissions and disclosure to the public, SCAQMD staff recommends using only publicly available models. 1636 of 2287
Chapter 4 – Considerations When Analyzing GHG Emissions 4 - 2 October 2008
relatively straightforward as onsite GHG sources or directly related offsite GHG sources, such as worker commute trips, are generally readily identifiable. Indirect GHG emission sources are less obvious, but may include some of the sources identified in the following paragraphs. In general, for most projects information on direct and indirect emissions may be available, rather than a full life-cycle analysis of emissions. The lead agency has typically been expected to address emissions that are closely related and within the capacity of the project proponent to control and/or influence.

CAPCOA’s White Paper provides a comprehensive discussion of modeling tools that are currently available for analyzing GHG emissions. Further, no one model is currently available that is capable of estimating all of a project’s direct and indirect GHG emissions. Although there are a number of modeling tools available to calculate GHG emissions the following discussion focuses on a combination of approaches using the URBEMIS model as the basis for analyzing GHG emission impacts. Other approaches for calculating GHG emissions can be used, as long as they are supported by scientific evidence and include publicly available information.

The URBEMIS model is a publicly available model that is currently used statewide to calculate criteria pollutant emissions from construction and operation activities for a wide variety of land use projects. The model is regularly updated through a collaboration of air pollution control agencies, including the SCAQMD, to reflect the most current data, methodologies, and emission factors for quantifying criteria pollutant emissions. The most current update to the model is URBEMIS2007 version

9.2.4, which quantifies CO2 emissions in addition to criteria pollutant emissions.

Currently, there are several disadvantages to using the URBEMIS model to calculate GHG emissions from a proposed project and, as a result, it should not be the only tool used to calculate GHG emissions. For example, currently the URBEMIS model only quantifies CO2 emissions and not other GHG pollutants, with the exception of methane from mobile sources, which is converted to CO2eq. emissions. Since CO2 emissions comprise the bulk of GHG emissions from most projects, URBEMIS GHG results are fairly representative of GHG emissions from a project.

To quantify mobile source emissions from on-road mobile sources, the URBEMIS model uses trip rate information from the Institute of Transportation Engineers Trip Generation Handbook (ITE, 2001) as the trip rate default factor for all land uses. ITE trip rate information is widely used and is considered legally defensible as they rely on substantial reports and surveys of trip rates in cities with little or no transit. As a result, the ITE trip rates are also considered to provide a conservative estimate of trip 1637 of 2287
Chapter 4 – Considerations When Analyzing GHG Emissions 4 - 3 October 2008
rates and associated emissions. The model, however, treats each trip as a separate trip and doesn’t consider that a single trip may be used for more than one purpose, referred to as “internalization.” The model also does not fully account for interaction between land uses in its estimation of mobile source operational emissions. URBEMIS does allow the user to overwrite the default trip rates and characteristics with more projectspecific data from a traffic study prepared for a project.

In spite of the disadvantages of the URBEMIS model described above, it can be used as the first step in quantifying GHG emissions for typical land use projects because it establishes default parameters for the most common emission sources from a project including construction equipment types and activity profiles, area of site disturbed during construction, building size, number vehicle trips, etc., if the level of information about the project is low. If more information about the project is available such as a precise profile of construction equipment and activity levels, number of vehicle trips based on a traffic study prepared for the project, etc., this information can be incorporated into the model. The model can then quantify CO2 emissions from both construction and operation.

The URBEMIS construction analysis quantifies criteria pollutant and CO2 emissions from both off-road sources (primarily construction equipment) and on-road sources (worker commute trips, haul truck trips, etc.). To further flesh out the construction analysis, the lead agency would have to identify emission factors for other GHG pollutants likely to be emitted during construction, i.e., methane and nitrous oxide4 , for
both off-road and on-road emissions sources and then quantify the GHG emission results using spreadsheets or other available tools.

The off-road CO2 emission factors in the URBEMIS model are generated from CARB’s off- road model (http://www.arb.ca.gov/msei/offroad/offroad.htm). Methane emission factors for off-road equipment can also be obtained from CARB’s OFFROAD2007 model. CO2 and methane emission factors for off-road equipment that are based on CARB’s OFFROAD2007 model can also be found on the SCAQMD’s CEQA webpages at the following URL:
http://www.aqmd.gov/ceqa/handbook/offroad/offroad.html. Other sources of off-road GHG emissions factors for equipment used in California may be used, as long as they are supported by scientific evidence and are publicly available.

The URBEMIS model is able to quantify mobile source CO2 emissions during construction from on-road mobile sources such as construction worker commute trips, heavy-duty truck trips to haul away demolition debris, soil hauling to and from the site etc., and during operation, primarily vehicle trips using ITE’s Trip Generation Manual (ITE, 2001). The on-road CO2 emission factors in the URBEMIS model for both construction and operation are generated from CARB’s on- road mobile source emissions model, EMFAC2007 (http://www.arb.ca.gov/msei/onroad/onroad.htm).

Methane emission factors for on-road mobile sources can also be obtained from

4 Hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride are not combustion emissions, so would not normally be emitted during construction.
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Chapter 4 – Considerations When Analyzing GHG Emissions 4 - 4 October 2008
CARB’s EMFAC2007 model. CO2 and methane emission factors for on-road mobile sources that are based on CARB’s EMFAC2007 model can also be found on the SCAQMD’s CEQA webpages at the following URL:
http://www.aqmd.gov/ceqa/handbook/onroad/onroad.html.

The analysis of operation emissions from all types of land uses in the URBEMIS model focuses primarily on mobile source emissions and some area sources. The model does not quantify emissions from stationary sources. For stationary sources that require a permit from the SCAQMD, emission calculation procedures and methodologies are available in the SCAQMD’s Best Available Control Technology Guidelines (http://www.aqmd.gov/bact/partd7-9-2004update.pdf). Examples of facilities that use stationary sources requiring a permit from the SCAQMD include:
fossil fuel power plants5
, cement plants, landfills, wastewater treatment plants, gas stations, dry cleaners and industrial boilers. The SCAQMD has procedures and methodologies for projects subject to SCAQMD permits to calculate criteria pollutants and air toxics. It is anticipated that these same procedures and methodologies could be extended to estimate a permitted facility’s GHG calculations. For are any stationary and area sources that do not require SCAQMD permits, the same methodologies used for permitted sources could be used. It will be necessary to contact the SCAQMD to obtain information on GHG emission calculation methodologies applicable to stationary source equipment.

Indirect Impacts - Indirect or secondary effects may include growth-inducing effects and other effects related to induced changes in the pattern of land use, population density, or growth rate, and related effects on air and water and other natural systems, including ecosystems (CEQA Guidelines §15358)(a)(2)). The examples of facilities that use stationary sources requiring a permit from the SCAQMD that may contribute to direct environmental impact (fossil fuel power plants, cement plants, landfills, wastewater treatment plants, gas stations, dry cleaners and industrial boilers) may also contribute to indirect impacts and, therefore, should be included, as necessary in the CEQA analysis of GHGs.

Quantification Methodologies and GHG Emission Factors
Methodologies for calculating GHG emissions and GHG emission factors are currently not readily available. Until such time as GHG calculation methodologies and emission factors become well established and more readily available, lead agencies may want to consult the following references to identify acceptable methodologies and emission factors.

1. The first useful reference for GHG emission factors for stationary sources is EPA’s Air Pollutant (AP)-42, which is a compilation of air pollutant emission

5 According to CEQA Guidelines §15227, CEQA does not apply to projects outside of California. The California Attorney General’s Office has rendered an opinion stating that the definition of the environment in CEQA does not stop at the borders of California. Further, California public agencies that take an action outside of California is still bound by the requirements of CEQA to prepare an EIR if the action may cause a significant effect on the environment.
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factors for stationary point and area sources. Each of the first 13 chapters of AP42 is dedicated to a specific source activity such as solid waste disposal, petroleum industry, and metallurgical industry. Since the publication of the fifth edition (and supplementals) in 2001, there have been a number of updates to the various specific stationary sources such as hot asphalt plants, organic liquid storage tanks, and coke production. In addition to the criteria pollutant emissions, some of the updated AP-42 chapters provide GHG emission factors for a variety of sources.

For example, Chapter 15 of AP-42 focuses on GHG emissions from biogenic sources such as soils, termites, lightning, and enteric fermentation (animal digestive fermentation).

2. Second, the California Climate Action Registry (C-CAR) has prepared a General Reporting Protocol (GRP), which is a relatively easy-to-follow user's manual that outlines the principles, concepts, calculation methodologies and procedures required for effective participation in the California Registry. The appendices of the GRP provide GHG emissions factors, specifically CO2, CH4 and N2O, for electricity use, mobile combustion and stationary combustion based on fuel usage type.

3. Third, a thorough internet search should be conducted to find reliable sources of emissions factors that would assist in accurately determining GHG emissions from a specific source being evaluated. Again, all potential GHGs, such as CO2, CH4 and N2O, should be evaluated to the best of one’s ability to locate dependable information.

4. Finally, a material balance approach also may provide reliable average emission estimates for specific sources. A material balance is when one accounts for (or “balances”) all the materials going into and coming out of the process in order to make a credible emissions estimation. For some sources, a material balance may provide a better estimate of emissions especially in situations where a high percentage of material is lost to the atmosphere (e. g., sulfur in fuel, or solvent loss in an uncontrolled coating process.) In other cases, material balances may be inappropriate where material is consumed or chemically combined in the process, or where losses to the atmosphere are a small portion of the total process throughput.

Reporting GHG Emissions – Daily vs. Annual Emissions
The analysis of GHGs is a much different analysis than the analysis of criteria pollutants for the following reasons. For criteria pollutants, significance thresholds are based on daily emissions because attainment or non-attainment is based on daily exceedances of applicable ambient air quality standards. Further, several ambient air quality standards are based on relatively short term exposure effects on human health, e.g., one-hour and eight-hour. Since the half-life of CO2 is approximately 100 years, the effects of GHGs are longer-term, affecting global climate over a relatively long time frame (see also Table 3-1).
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Typical GHG emission inventories (EPA5, ARB6, etc.) represent directly emitted GHGs during a given year. As a result, the current convention is to present GHG emissions as annual emissions. The URBEMIS model can be set to calculate annual emissions for a project. When using the URBEMIS model to calculate annual GHG emissions, it may be useful to modify the trip rate for each land use using a weighted trip rate average to more accurately reflect annualized trip rates. A weighted trip rate average reflects the trip rates during the week, as well as trip rates during Saturdays and Sundays. Trip rate information for weekdays and weekend days can be found in the ITE Trip Rate Handbook.
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C H A P T E R 5

C O N C L U S I O N
Introduction
Future Action Items
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INTRODUCTION
CEQA Guidelines §15064.7(a) encourages lead agencies to establish thresholds of significance to determine the significance of an environmental impact. Further, thresholds of significance to be adopted for general use as part of the lead agency's environmental review process must be adopted by ordinance, resolution, rule, or regulation, and developed through a public review process and be supported by substantial evidence (CEQA Guidelines §15064.7(b)). Staff’s proposed interim GHG significance threshold proposal has been developed through a public process consisting of a series of Stakeholder Working Group meetings. Staff proposals have been modified over time based on written and oral feedback from the Working Group.

Staff’s intent was to reach consensus to the extent feasible, but for some items staff could not find common ground with some of the stakeholders.

The next immediate step for SCAQMD staff is to present a final interim GHG significance threshold proposal to the SCAQMD Governing Board for consideration.

If the Governing Board approves staff’s final interim GHG significance threshold proposal, then staff will embark on a number of short-term and intermediate term activities to provide outreach to public agencies that might use staff’s interim GHG significance threshold to determine whether or not their projects’ GHG emissions are significant, periodically revisit and revise as necessary the interim proposal, and accommodate stakeholders’ requests for more information on GHG calculation methodologies and mitigation measures. The following sections provide discussions on future anticipated action items

FUTURE ACTION ITEMS
Interim GHG Significance Threshold Outreach Program
It is currently anticipated that staff’s interim GHG significance threshold proposal will be presented to, and considered by the Board at the November 7, 2008 public hearing.

Consistent with other significance threshold proposals adopted by the Governing Board, if the draft GHG significance threshold proposal is adopted, staff will meet with local cities, councils of governments, and leagues of cities to discuss the staff proposal and address any questions or concerns.

Once the interim GHG significance threshold is adopted, this Guidance Document will be posted on the SCAQMD’s CEQA web pages. Staff will also send notice of the adoption of the staff proposal to all agencies, organizations, and individuals on the SCAQMD’s CEQA “Interested Parties” mailing list. In addition, it is expected that staff will prepare and make available an informational brochure that summarizes information about the interim GHG significance proposal in addition to this Guidance Document.
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Starting in January 2009, as part of its intergovernmental review (IGR) responsibilities under CEQA, where the SCAQMD reviews and CEQA documents prepared by other public agencies, SCAQMD will begin more thorough evaluations of CEQA documents with regard to their GHG analyses and the basis by which they make a determination of significance. Staff will begin recommending use of the staff’s interim GHG significance threshold proposal or other available GHG significance thresholds based on substantial evidence in comment letters on notices of preparation of an EIR. As of March 1, 2009, staff will formally recommend use of staff’s interim GHG significance threshold proposal or other available GHG significance thresholds based on substantial evidence in comment letters on NDs and MNDs. As of July 1, 2009, staff will formally recommend use of staff’s interim GHG significance threshold proposal or other available GHG significance thresholds based on substantial evidence in comment letters on EIRs.

Compile Lists of GHG Design Features and Mitigation Measures CEQA Guidelines §15126.4 requires an EIR to “describe feasible measures which could minimize significant adverse impacts, including where relevant, inefficient and unnecessary consumption of energy.” Ideally, it is desirable to avoid impacts altogether through incorporating design features into the proposed project. Because staff’s recommended interim GHG significance threshold includes performance standards (see tier 4 compliance options 1 and 3) or a project proponent may try to reduce GHG emissions to less than the applicable screening levels, mitigation measures or design features are important components of the overall GHG significance threshold strategy. As a result, a number of GHG Working Group stakeholders has requested that SCAQMD compile lists of design features or mitigation measures to assist with reducing GHG emissions for all land use types.

In response to the request from GHG Working Group stakeholders to develop GHG design features and mitigation measures, over the next year SCAQMD staff will compile lists of GHG reduction strategies, including control efficiencies, by sector and make the lists available online with other recommended mitigation measures. There is already a robust body of mitigation measures available (see in particular the CAPCOA bullet point discussion below), but in most cases, they do not include control efficiencies. SCAQMD staff will use the following mitigation sources as a basis from which to compile mitigation strategies.
• CEQA Guidelines, Appendix F – this appendix includes a list of general energy conservation measures that may be used as a basis to identify GHG reduction strategies. The measures do not contain GHG control efficiencies, so they would need further review to determine if control efficiencies are available. • CAPCOA White Paper – this document provides a comprehensive discussion of GHG reduction strategies and specific mitigation measures are listed in Table 16 in Appendix B. The mitigation measures are grouped by emissions source type, such as transportation measures, parking measures, commercial and residential design features, etc. Table 16 also provides other useful information about each 1644 of 2287
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mitigation measure including source of each measure, comments and descriptions about each control measure, etc. Most importantly, for many of the mitigation measures CAPCOA has included an emission reduction score. In most cases, the emission reduction score is given as a range. As a result, further evaluation would be necessary to provide a single more precise emission reduction score or a defensible average. Otherwise, it is likely that the high end of the emission reduction score would be used.
• CARB - is actively working to develop and adopt GHG protocols to support the Climate Change Program. CARB is working in collaboration with other agencies and organizations, including the California Climate Action Registry, to adopt consistent and standardized methods to accurately report GHG emissions. There are two kinds of GHG protocols, a reporting protocol and a project protocol. The project protocol may be useful as it sets standards and provides specific guidance to define GHG reduction projects and quantify and report GHG reductions from project activities. Some example protocols include manure management and urban forestry. It is expected that additional protocols will be developed and adopted by CARB. It is also expected that CARB’s Scoping Plan may provide guidance on regulatory guidance that could be used to develop GHG emission reduction measures. GHG reduction strategies that may also serve as GHG mitigation measures to be developed by CARB over the next two years are shown in Table 5-

1. Table 5-1
California Air Resources Board GHG Emission Reduction Strategies Strategy Description of Strategy
Other Light Duty
Vehicle
Technology
New standards would be adopted to phase in beginning in the 2017 model year
Hydrofluorocarbon
Reduction
1) Ban retail sale of HFC in small cans; 2) Require that only low global warming potential (GWP) refrigerants be used in new vehicular systems; 3) Adopt specifications for new commercial refrigeration; 4) Add refrigerant leak-tightness to the pass criteria for vehicular Inspection and Maintenance programs; 5) Enforce federal ban on releasing HFCs.

Transportation
Refrigeration
Units, Off-Road
Electrification,
Port Electrification
Strategies to reduce emissions from TRUs, increase off-road electrification, and increase use of shore-side/port electrification.

Manure
Management
San Joaquin Valley Rule 4570 (adopted 6/15/06) reduces volatile organic compounds from confined animal facilities through implementation of control options.

Alternative Fuels:

Biodiesel
Blends
CARB would develop regulations to require the use of 1 to 4 percent biodiesel displacement of California diesel fuel.
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Table 5-1 (Concluded)
California Air Resources Board GHG Emission Reduction Strategies Strategy Description of Strategy
Alternative Fuels:

Ethanol
Increased use of ethanol fuel.

Heavy-Duty
Vehicle Emission
Reduction
Measures
Increased efficiency in the design of heavy duty vehicles and an education program for the heavy duty vehicle sector.

Reduced Venting
and Leaks in Oil
and Gas Systems
Rule considered for adoption by the Air Pollution Control Districts for improved management practices.

Hydrogen
Highway
The California Hydrogen Highway Network (CA H2 Net) is a State initiative to promote the use of hydrogen as a means of diversifying the sources of transportation energy.

Achieve 50%
Statewide
Recycling Goal
Achieving the State’s 50 percent waste diversion mandate as established by the Integrated Waste Management Act of 1989, (AB 939, Sher, Chapter 1095, Statutes of 1989), will reduce climate change emissions associated with energy intensive material extraction and production as well as methane emission from landfills. According to the California Integrated Waste Management Board, in 2005 the statewide waste diversion rate was 52 percent.6
Landfill Methane
Capture
Install direct gas use or electricity projects at landfills to capture and use emitted methane.

Zero Waste - High
Recycling
Additional recycling beyond the State’s 50% recycling goal. • CEC and CPUC – These agencies are actively developing GHG emission reduction strategies that may also be used to develop GHG mitigation measures for specific energy production sources. Examples of CEC and CPUC GHG emission reduction strategies are shown in Table 5-2.

Other sources of potential GHG emission reduction measures will be evaluated and incorporated, as applicable into any GHG mitigation measure lists developed by the SCAQMD.

6 CIWMB, 2007; http://www.ciwmb.ca.gov/LGCentral/Rates/Diversion/2005/Default.htm 1646 of 2287
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Table 5-2
GHG Emission Reduction Strategies Implemented by CEC and CPUC Strategy Description of Strategy

E N E R G Y C O M M I S S I O N ( C E C )
Building Energy
Efficiency
Standards in Place
and in Progress
Public Resources Code 25402 authorizes the CEC to adopt and periodically update its building energy efficiency standards (that apply to newly constructed buildings and additions to and alterations to existing buildings).

Appliance Energy
Efficiency
Standards in Place
and in Progress
Public Resources Code 25402 authorizes the Energy Commission to adopt and periodically update its appliance energy efficiency standards (that apply to devices and equipment using energy that are sold or offered for sale in California).

Cement
Manufacturing
Cost-effective reductions to reduce energy consumption and to lower carbon dioxide emissions in the cement industry.

Municipal Utility
Strategies
Includes energy efficiency programs, renewable portfolio standard, combined heat and power, and transitioning away from carbon intensive generation.

Alternative Fuels:
non-Petroleum
Fuels
Increasing the use of non-petroleum fuels in California’s transportation sector, as recommended in the CEC’s 2003 and 2005 Integrated Energy Policy Reports.

P U B L I C U T I L I T I E S C O M M I S S I O N ( P U C ) Accelerated
Renewable
Portfolio Standard
(33 percent by
2020)
The Governor has set a goal of achieving 33 percent renewables in the State’s resource mix by 2020. The joint PUC/Energy Commission September 2005 Energy Action Plan II (EAP II) adopts the 33 percent goal.

California Solar
Initiative
The solar initiative includes installation of 1 million solar roofs or an equivalent 3,000 MW by 2017 on homes and businesses, increased use of solar thermal systems to offset the increasing demand for natural gas, use of advanced metering in solar applications, and creation of a funding source that can provide rebates over 10 years through a declining incentive schedule.

Investor-Owned
Utility
This strategy includes energy efficiency programs, combined heat and power initiative, and electricity sector carbon policy for investor owned utility.

Periodically Review the Interim GHG Significance Threshold SCAQMD staff will periodically review and revise staff’s GHG proposal to incorporate applicable updated information on GHGs and GHG reduction strategies resulting from regulatory requirements or advances in technology. Some areas of the current proposal that may be reevaluated include the tier 3 screening levels, and the tier 4 compliance option 1 GHG reduction target objective. Further, staff will evaluate whether or not sector based performance standards can be developed for tier 4 compliance option 3.

If a statewide GHG significance threshold is developed by CARB, staff will review that threshold and report to the Governing Board by March 2009 considering such a 1647 of 2287
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threshold for adoption.regarding any implementation issues and ways to transition into the recommended GHG significance threshold within six months of formal approval by the CARB Board.
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R E F E R E N C E S
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References
References - 1 October 2008
Association of Environmental Professionals (AEP). 2007. White Paper on Global Climate Change – Final Version. June 2007
California Air Pollution Control Officers Association (CAPCOA). 2008. CEQA and Climate Change Evaluating and Addressing Greenhouse Gas Emissions from Projects Subject to the California Environmental Quality Act. January 2008.

California Air Resources Board (CARB). 2007. California Greenhouse Gas Emissions Inventory. December 2007.

California Air Resources Board (CARB). 2008. Climate Change Proposed Scoping Plan A Framework for Change. October 2008.

Institute of Transportation Engineers (ITE). 2001. Trip Generation Handbook An ITE Recommended Practice (7th ed.). March 2001.

Intergovernmental Panel on Climate Change (IPCC). 2007a. Climate Change 2007 – Synthesis Report. Contribution of Working Group I to the Fourth Assessment Report of the IPCC.

Intergovernmental Panel on Climate Change (IPCC). 2007b. Climate Change 2007 - The Physical Science Basis. IPCC Plenary XXVII (Valencia, Spain, 12-17 November 2007).

South Coast Air Quality Management District (SCAQMD). 2004. Best Available Control Technology Guidelines. July 2004. (http://www.aqmd.gov/bact/partd7-9-2004update.pdf) 1650 of 2287

APPENDIX A

W O R K I N G G R O U P M E M B E R S A N D

C O N T R I B U T O R S
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Appendix A Working Group Members and Contributors
A - 1 October 2008
WORKING GROUP MEMBERS AND AFFILIATION:

Greg M Adams Los Angeles County Sanitation District
James Arnone Latham and Watkins
Jonathan Evans Center for Biological Diversity
Doug T. Feremenga San Bernardino County Land Use Planning Department Mark Grey Building Industry Association (BIA) of Southern California Gretchen Hardison City of Los Angeles, Environmental Affairs Mike Harrod Riverside County Planning Department
Michael Hendrix Association of Environmental Professionals Thomas Jelenic Port of Long Beach
Ruby Maldonado Orange County Planning Department
Bill La Marr California Small Business Alliance
Julia Lester Dairies/California Farmers Bureau
Shari Libicki Green Developers Coalition
Lena Maun-DeSantis Port of Los Angeles
Daniel Mc Givney Southern California Alliance of Public Owned Treatment Works Clayton Miller Construction Industry Air Quality Coalition (CIAQC) Jonathan Nadler Southern California Association of Governments Peter Okurowski California Environmental Associates
Bill Piazza Los Angeles Unified School District
Bill Quinn California Council for Environmental and Economic Balance (CCEEB) Cathy Reheis-Boyd Western States Petroleum Association
Janill L Richards California Department of Justice, Public Rights Division, Environment Section Jamesine Rogers California Air Resources Board (CARB)
Terry Roberts Office of Planning and Research (OPR)
David Somers City of Los Angeles - Planning
Debbie Stevens Refineries
Jocelyn Thompson Weston, Benshoof, Rochefort, Rubalcava, MacCuish Attorneys at Law Carla Walecka Realtors Committee on Air Quality (RCAQ)
Lee Wallace The Gas Company
INVITED AS MEMBERS BUT HAVE NOT ATTENDED:

Rick Bishop Western Riverside Council of Governments
Adrene K Briones City of Los Angeles, LADWP
Rick Cameron Port of Long Beach
Bahram Fazeli Communities for a Better Environment (CBE) Daniel Fierros Los Angeles County Regional Planning, Impacts Analysis Section Timothy Grabiel Natural Resources Defense Council (NRDC) Andrea M Hricko USC Keck School of Medicine, Environmental Health Sciences Center Angela Johnson Meszaras California Environmental Rights Alliance Janea Scott Environmental Defense Fund
Martin Shlageter Coalition for Clean Air (CCA)
Bryan Speegle Orange County Planning Department
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A - 2 October 2008
ALTERNATES AND AFFILIATION:

Jeannie Blakeslee CARB
Frank Caponi Los Angeles County Sanitation District
Andrew Cheung Los Angeles Unified School District
Mark Elliott CCEEB
Jay Golida Los Angeles Unified School District
Andy Henderson BIA of Southern California
Carrie Hyke San Bernardino County Land Use Planning Department Michael Lewis CIAQC
John Pastore Southern California Alliance of Public Owned Treatment Works Sharon Rubalcava Weston, Benshoof, Rochefort, Rubalcava, MacCuish Attorneys at Law Andrew Skanchy Latham and Watkins
Justis Stewart SCAG
Allyson Teramoto Port of Long Beach
Cindy Thielman-Braun Riverside County Planning Department Matt Vespa Center for Biological Diversity
Michael Wang WSPA
INTERESTED PARTIES:

Lysa Aposhian Sanitation Districts of Los Angeles
Gregory K Arifian MWH Americas Inc
Leila Barker LADWP
Jack Bean Tesoro
Joe Becca Universal Studios
Aaron Dean Burdick ICF International
Curtis L. Coleman Law Offices of Curtis L. Coleman
Keith Cooper ICF Jones & Stokes
Kris Flaig LA Bureau of Sanitation, Department of Public Works, Regulatory Affairs Howard D Gollay Southern California Edison
Bill Gorham ENSR Consulting and Engineering
Jay Grady California Portland Cement Co.

Patrick Griffith Los Angeles Unified School District
Tony Held ICF, Jones & Stokes
Miles T. Heller BP
Jonathan A. Hershey City of Los Angeles
Vijaya Jammalamadaka Santa Barbara County APCD
Stephen L Jenkins Michael Brandman Associates
Robert Jenne CARB
Diana Kitching LA City Department of Planning
Chandra Knott City of Irvine
Vladimir Kogan Orange County Sanitation District, Air Quality & Special Projects Div.

Leslie Krinsk CARB
Martin Ledwitz Southern California Edison
Rina Leung City of Rancho Cucamonga
Serena Lin Environmental Defense Fund
Allen Lind CCEEB
Sung Key Ma Riverside County Waste Management Department Josh Margolis Cantor Cole
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A - 3 October 2008
Marty Meisler Metropolitan Water District
Denise Michelson BP
Vince Mirabella Michael Brandman Associates
Danielle K Morone Gatzke Dillon & Ballance LLP
Pang Mueller Tesoro Refining & Marketing Co - Los Angeles Refinery Krishna Nand City of Vernon
Jan Nguyen Exxon Mobil
Maurice Oillataguerre City of Glendale Public Works Dept.

Lynn Perkinton URS Corp.

Haseeb Qureshi Urban Crossroads
Ron Ricks BP
Leonard Scandura San Joaquin Valley APCD
Darren W Stroud Valero Energy Corporation
Ryan Taylor Brian F. Associates
Greg Tholen Bay Area Air Quality Management District (BAAQMD) Dave Vintze BAAQMD
Sarah Weldon California Environmental Associates
Darcy Wheeles California Environmental Associates
Janet Whittich CCEEB
A.L. Wilson Southern California Edison
Cori Wilson Michael Brandman Associates
Lisa Wunder The Port of Los Angeles
Robert A Wyman Jr. Latham & Watkins
Rick Zbur Latham & Watkins
Michael H Zischke Cox Castle & Nicholson LLP
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APPENDIX B

S U M M A R I E S O F W O R K I N G G R O U P M E E T I N G S 1655 of 2287
Appendix B Summaries of Working Group Meetings
B - 1 October 2008
WORKING GROUP MEETING #1 (APRIL 30, 2008)
At the first Working Group meeting SCAQMD staff presented the Working Group with a number of policy objectives and design criteria for consideration to establish the framework for developing a GHG significance threshold. Policy objectives include the following concepts. First, the GHG significance threshold should minimize environmental degradation, that is, it should not make impacts worse. To this end, it may be useful to develop a GHG significance threshold that achieves GHG emissions reductions that are consistent with the goals of AB 32 estimated to be approximately 30 percent reduction of GHG emissions from business-as-usual.

Although CEQA or a GHG significance threshold established pursuant to CEQA may be useful tools in reducing GHG emissions, they would act in parallel with regulatory requirements, e.g., AB 32, but they do not replace them. As a result, there is no requirement that a GHG significance threshold must reduce GHG emissions consistent with AB 32 or EO S-3-05.

In addition to policy considerations, a number of GHG significance threshold design criteria were also considered. An important consideration in developing a GHG significance threshold is the potential administrative burden it may create on lead agencies through increased resource impacts such as increased costs and staff if the significance threshold is established too low. For example, a zero threshold might result in eliminating or substantially reducing the number of projects that qualify for a categorical exemption, a negative declaration, or a mitigated negative declaration.

Other design considerations discussed included establishing a single GHG threshold, such as a “bright line” numerical threshold or multiple thresholds, such as the tiered approaches identified by CAPCOA, etc.

WORKING GROUP MEETING #2 (MAY 28, 2008)
At the second Working Group meeting, staff presented design criteria recommendations based on the discussion at the first Working Group meeting and correspondence received subsequent to the first Working Group meeting. With regard to analyzing life cycle GHG emissions, staff’s initial recommendation was to exclude an analysis of life cycle emissions because life cycle process are not well established.

Instead, the GHG emissions analysis should focus on direct and indirect impacts, consistent with current CEQA requirements (CEQA Guidelines §15064(d)). Feedback from the Working Group suggested that a CEQA analysis may be considered deficient without making an effort to conduct a life cycle analysis. Further, if life cycle emissions data are not available, the lead agency should note this consider further analysis speculative and terminate the discussion (CEQA Guidelines §15145).

Another design criteria recommendation made by staff was to take into consideration the administrative burden and resources impacts when establishing a GHG significance threshold. Staff recommended that the GHG significance threshold 1656 of 2287
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B - 2 October 2008
should not be set too low, which could result in all projects going through the EIR process. It was pointed out that requiring an EIR for all projects does not necessarily result in more mitigation, no meaningful mitigation may be available for small projects, and it may provide a disincentive for implementing mitigation if the measures are unable to reduce GHG impacts to less than significant.

Other design criteria recommended by staff included analyzing the six Kyoto GHGs, any GHG significance threshold established would be considered interim and would be periodically evaluated and updated as necessary, etc. Staff also introduced the concept of preferred GHG mitigation strategies using a hierarchy from the most to least preferred strategies as shown below.

1. Incorporate GHG reduction strategies into project design

2. Mitigate GHGs from other onsite sources for modification projects

3. Mitigate offsite GHG emission reduction projects

4. Mitigate both construction & operational GHG impacts

5. Consider feasible mitigation based on economic factors (cost) pursuant to CEQA Guidelines §15364

6. Purchase acceptable GHG offsets with preference toward GHG reduction projects occurring in-basin or in-state (offset cost a consideration). The following points should be considered:
a. Offset market still developing, so it is necessary to ensure offsets are obtained from a credible source
b. Offsets should be provided for at least 10 years of project operation (see SJVAPCD indirect source Rule 9510 §6.2 mitigation requirements) Finally, SCAQMD staff introduced the initial staff proposal. The initial staff proposal consisted of a tiered approach, similar to CAPCOA’s Approach 2 with mandatory GHG mitigation measures. Each tier of this proposal is briefly described in the following bullet points and shown graphically in Figure B-1. • The first tier consists of evaluating whether or not the project qualifies for any applicable exemption under CEQA. For example, SB 97 specifically exempts a limited number of projects until it expires in 2010. If the project qualifies for an exemption, no further action is required. If the project does not qualify for an exemption, then move to the next tier.
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B - 3 October 2008
Figure B-1
Initial Staff Proposal – Proposed Tiered Approach – May 28, 2008 Significance determination of Cumulative Impacts from GHG emissions:

Construction Operation

1. Local General Plans, at a minimum, must comply with AB32 reduction goals; have been analyzed under CEQA, and have a certified Final CEQA document; emission estimates approved by CARB or SCAQMD; include a GHG inventory tracking mechanism; and a commitment to remedy the excess emissions if AB32 goals are not met.

2. SCAQMD will work with CAPCOA to develop a list of mitigation measures.

Applicable
Exemptions, if any
Early
Compliance
with AB32
measures (e.g.
low carbon fuel
standard)
Quantify Residual GHG Emissions; Implement Offsite
Mitigation and/or Offsets Mitigating GHG Emissions to Zero Significant
Demonstrate Consistency with GHG Component of
Local General Plan1 OR equivalent regional approach
No Further
Action
Mitigated
to Not
Significant
Stationary
Source (new or
modified) –
Carbon
BARCT/
BACT 2
Land Use/Indirect Sources
Predetermined Mitigation
Package by Sector (over)
Residential Commercial Industrial
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B - 4 October 2008
• The second tier consists of determining whether or not the project is consistent with a GHG reduction plan that is part of a local general plan for example. The GHG reduction plan must, at a minimum, comply with AB 32 reduction goals; include emission estimates approved by CARB or SCAQMD, have been analyzed under CEQA, and have a certified Final CEQA document. Further, the GHG reduction plan must include a GHG inventory tracking mechanism; process to monitor progress in achieving GHG emission reduction targets, and a commitment to remedy the excess emissions if AB 32 goals are not met (enforcement). If the proposed project is consistent with the local GHG reduction plan, it is not significant for GHG emissions.

The concept of consistency with a GHG reduction plan, is similar to the concept of consistency in CEQA Guidelines §15125(d). If the proposed project does not comply with the local GHG reduction plan or no GHG reduction plan has been adopted, then move to the third tier.
• Under the third tier there are three options that can be used to demonstrate that a project would not have significant emissions. The first significance option is early compliance with AB 32 Scoping Plan measures. The second significance option, primarily for stationary source equipment, would be to install carbon best available retrofit control technology (BARCT) or best available control technology (BACT).

Carbon BARCT/BACT would be established by the SCAQMD. The third significance option for industrial, commercial, and residential land use projects would be to implement a menu of prescribed mitigation measures. Mitigation measures would be developed for each land use sector by SCAQMD staff. Implementing one of these three options would result in a determination that GHG emission impacts from the proposed project are not significant. If the proposed project is unable to implement any one of these three options or cannot fully implement any option, then it would move to the fourth tier.
• Under the fourth tier, the lead agency would quantify GHG emissions from the project and implement offsite mitigation (GHG reduction projects) or purchase offsets. Under this tier, GHG emission impacts the lead agency would be required to mitigate or offset GHG emissions to zero. If GHG emissions can be offset to zero, GHG emissions from the project are concluded to be insignificant. If GHG impacts cannot be reduced to zero, the project is concluded to be significant for GHGs.

WORKING GROUP MEETING #3 (JUNE 19, 2008)
Subsequent to Working Group meeting #2, SCAQMD staff received feedback on the initial staff proposal. Issues and concerns raised by the stakeholders on the initial staff proposal were addressed at the third Working Group meeting and are summarized in the following bullet points.
• The staff proposal does not explicitly state any quantitative or qualitative target objectives. If there are no explicit target objectives, how is it possible to determine whether or not a project is insignificant for GHG emissions? 1659 of 2287
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• Concerns were raised regarding the lack of detail relative to the sector-specific mitigation measures and the potentially lengthy lag time between implementing the GHG significance threshold and developing the mitigation measures. • For most projects, GHG emissions would not need to be calculated as long as the prescribed menu of sector-specific mitigation measures is implemented. Without quantifying GHG emissions and the control efficiencies of the mitigation measures, a project would be vulnerable to a “Fair Argument” that GHG emissions are still significant even after implementing prescribed mitigation measures. • A CEQA document may be vulnerable in court if control efficiencies of mitigation measures are not identified.
• Is the staff proposal really a zero GHG significance? Based on Working Group feedback, staff presented revised staff proposal #1, which consisted of a tiered decision tree approach. The components of revised staff proposal #1 are described in the following bullet points and shown graphically in Figure B-2.

As shown in Figure B-2, some of the tier components of the revised staff proposal are similar to those in the initial staff proposal.
• Tier 1 – no change from the initial proposal.
• Tier 2 – is a new component of the revised staff proposal. Tier 2 attempts to identify small projects that would not likely contribute to significant cumulative GHG impacts.

The de minimis or screening level of 900 metric tons per year is the level that is estimated by CAPCOA to capture 90 percent of the residential units or office space in pending application lists7. CAPCOA infers that projects that emit less than 900 metric ton per year would not likely be considered cumulatively considerable. Further, the 900 metric ton per year level would capture 90 percent
7 Although the CAPCOA White Paper implies that 900 metric tons per year equates to a 90 percent capture rate, there is no explicit information provided in the White Paper that demonstrates this correlation. Indeed, the CAPCOA authors state that 900 metric tons, which represents approximately 50 residential units, corresponds to widely divergent capture rate percentile rankings depending on the project location (see discussion on page 43 of the White Paper). Percentile rankings were based on a survey of four cities in California. A project of 900 metric tons per year representing a 90 percent capture rate appears to be a working assumption for which there appears to be no factual basis. Further, although not explicitly stated, it is assumed that the 900 metric tons were derived using the URBEMIS2007 model. It should be noted that that the URBEMIS2007 model only quantifies CO2 emissions and direct emissions primarily from on-road mobile sources.

It does not capture other GHG pollutants or indirect GHG emissions such as emissions from energy generation, water conveyance, etc. Therefore, it is likely that a 50-unit residential project would actually generate higher GHG emissions than 900 metric tons per year. 1660 of 2287
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B - 6 October 2008
Figure B-2
Revised Staff Proposal #1 Tiered Decision Tree Approach – June 19, 2008 Significance Determination of Cumulative Impacts from GHG Emissions:

1. Substitution for equivalent reductions allowed.

2. Local General Plans or other local plans local plans that, at a minimum, comply with the overall target objective or the sector-based CARB Scoping Plan; have been analyzed under CEQA, and have a certified Final CEQA document; emission estimates approved by CARB or SCAQMD; include a GHG inventory; tracking mechanism; enforcement; and a commitment to remedy the excess emissions if commitments are not met.

Tier 1: Applicable Exemptions, if any
Tier 3:

Decision
Tree
Options1
Compliance Option 4: GHG Emissions within GHG
Budgets in approved regional plans2
(similar to
consistency per existing CEQA Guidelines
§§15064(h)(3), 15125(d), 15130(d) or 15152 (a)).

No Further
Action
Less Than
Significant
Tier 2: Project’s Incremental GHG Emission Increase
Below a De Minimis Level or Mitigated to less than the
De Minimis Level (e.g., 900 MT/year CO2eq)

P R O P O S E D P R O J E C T
Significant
Compliance Option 1: Uniform Percent
Emission Reduction Target Objective (e.g.,
40 percent) from BAU By Incorporating
Project Design Features and/or
Implementing Mitigation Measures.

Compliance Option 2: Early Implementation
of Applicable AB32 Scoping Plan Measures
Compliance Option 3: Offsets alone or in combination
with the above to achieve target objective.
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B - 7 October 2008
of all pending projects, which means that 90 percent of all projects would have to implement GHG reduction measures.

If a project is less than 900 MT/year CO2eq or can mitigate to less than 900 MT/year CO2eq, it would be considered insignificant for GHGs. Projects larger than 900 MT/year CO2eq would move to tier 3.
• Tier 3 Decision Tree Options – consists of four decision tree options to demonstrate that a project is not significant for GHG emissions. The four compliance options are as follows.

Compliance Option 1 – the lead agency would calculate GHG emissions for a project using a business-as-usual (BAU) methodology. Once GHG emissions are calculated, the project proponent would have to incorporate design features into the project and/or implement GHG mitigation measures to demonstrate a 40 percent reduction from BAU. A 40 percent reduction below BAU was selected for the following reason. To comply with the AB 32 requirement of reducing GHG emissions to 1990 levels, an approximately 30 percent reduction from current BAU is necessary.

Since CEQA is not applicable to all GHG emission sources, i.e., existing projects that are not undergoing expansion or modifications, staff chose a 40 percent reduction below BAU requirement, which goes beyond the target GHG reduction objective of AB 32, but is still a potentially feasible GHG reduction for a variety of different projects.

Compliance Option 2 – this option is the same as the early compliance with AB 32 option in the third tier of the initial staff proposal.

Compliance Option 3 – this option is similar to the fourth tier of the initial staff proposal where GHG emissions would be reduced through offsite GHG reduction projects and/or use of offsets. This compliance option, however, would require offsetting GHG emissions by the same target objective as compliance option 1, that is, 40 percent below BAU instead of reducing GHG emissions to less than the de minimis or screening level.

Compliance Option 4 – this option is the same as the consistency with the greenhouse gas reduction plan component in the second tier of the initial staff proposal.

If the lead agency or project proponent cannot implement any of the compliance options in Tier 3, GHG emissions would be considered significant.

WORKING GROUP MEETING #4 (JULY 30, 2008)
Subsequent to Working Group meeting #3, SCAQMD staff received feedback on the revised staff proposal #1. Issues and concerns raised by the stakeholders on the initial 1662 of 2287
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B - 8 October 2008
staff proposal were addressed at the third Working Group meeting and are summarized in the following bullet points.
• Compliance with a GHG reduction plan should not be a compliance option in Tier 3, but should be its own tier, earlier in the tiering process. • There is a large disconnect between screening level and remaining emissions under the Tier 4 compliance options. For example, large projects that can reduce GHG emissions by the target objective of 40 percent would do so, which means GHG emissions would not be significant, could have substantially higher emissions than projects with GHG emissions less than the screening level.
• Compliance with a target objective should not be through offsets alone. Because of the uncertainties regarding the validity of offsets, preferred mitigation should consist of actual GHG emission reductions.
• The Tier 3 compliance option 1, GHG emissions reductions from BAU, is not the proper metric for determining significance. How can a lead agency be sure that the projected BAU emissions for a project are not artificially inflated to make it easier to achieve the required target objective?
• The Tier 3 compliance option 1, reducing GHG emission reductions from BAU, could penalize projects in environmentally progressive areas where BAU may be much lower than in other areas, thus, making it more difficult to achieve the target objectives.

Based on Working Group feedback and internal discussions, staff presented revised staff proposal #2, which further refined the previous tiered decision tree approach.

The components of revised staff proposal #2 are described in the following bullet points and shown graphically in Figure B-3. As shown in Figure B-3, some of the tier components of the revised staff proposal are similar to those in the initial staff proposal.
• Tier 1 – no change from the initial proposal.
• Tier 2 – compliance option 4 in Tier 3 has been moved back a stand-alone tier. • Tier 3 – the screening level that was previously Tier 2 has been moved to Tier 3. In response to feedback from the Working Group, the screening level has been increased to 6,500 MT/year CO2eq. The new screening level was derived using the SCAQMD’s existing NOx operational threshold as a basis. The daily NOx operational significance threshold, 55 pounds per day was annualized, which results in 10 tons of NOx per year.

Using the URBEMIS2007 model, staff initially modeled a mixed-use project that emits just under 10 tons per year to determine what the equivalent CO2 emissions would be.

Resulting CO2 emissions from the mixed use project were approximately 6,500 MT/year CO2. To further corroborate the 6,500 MT/year CO2 staff performed 19 modeling runs on a variety of projects including residential, commercial, industrial, and various combinations of land uses. In addition, since the analysis was an annual 1663 of 2287
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B - 9 October 2008
analysis, a weighted trip rate was derived for each land use category to obtain a more accurate estimate of trip rates throughout the week. Although the results from the 19 modeling runs were approximately 16 percent higher than staff’s original estimate of 6,500 MT/year CO2, 7,304 to 7,723 MT/year CO2, staff continued to recommend the 6,500 MT/year CO2 provides a margin of safety when deriving CO2 emissions based on the annualized NOx level of 10 tons per year and when evaluating different types of land use projects.

Projects with GHG emissions less than the screening level are considered to be small projects, that is, they would not likely be considered cumulatively considerable. However, because of the magnitude of increasing global temperatures from current and future GHG emissions, staff recommended that all projects must implement some measure or measures to contribute to reducing GHG emissions. Therefore, Tier 3 includes a requirement that all projects with GHG emissions less than the screening level must include efficiency components that reduce to a certain percentage beyond the requirements of Title 24 (Part 6, California Code of Regulations), California's energy efficiency standards for residential and nonresidential buildings.
• Tier 4 Performance Standards – Tier 3 from the revised staff proposal #1 has been moved to Tier 4 and renamed.
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B - 10 October 2008
Figure B-3
Proposed Tiered Decision Tree Approach – July 30, 2008
Significance Determination of Cumulative Impacts from GHG Emissions:

1. Local General Plans or other local plans local plans that, at a minimum, comply with the overall target objective or the sector-based CARB Scoping Plan; have been analyzed under CEQA, and have a certified Final CEQA document; emission estimates approved by CARB or SCAQMD; include a GHG inventory; tracking mechanism; enforcement; and a commitment to remedy the excess emissions if commitments are not met.

2. Substitution for equivalent reductions allowed.

Tier 1: Applicable Exemptions, if any
Tier 4:

Performance
Standards
No Further
Action
Less Than
Significant
for GHGs
Tier 3: GHG Emissions Incremental Increase Below, or
Mitigated to Less than the Significance Screening Level (e.g., 6,500 MT/year CO2eq) and x Percent Beyond Title 24.

P R O P O S E D P R O J E C T
Significant
Option #1: Uniform Percent Emission Reduction
Target Objective (e.g., 30 percent) from BAU by
Incorporating Project Design Features and/or
Implementing Emission Reduction Measures.

Option #2: Early Implementation of Applicable
AB32 Scoping Plan Measures2
.

Option #3: Achieve sector-based standard (e.g.,
pounds per person, pounds per square foot, etc.).

Tier 2: GHG Emissions within GHG Budgets in approved
regional plans1
(similar to consistency per existing CEQA
Guidelines §§15064(h)(3), 15125(d), 15130(d) or 15152 (a)).

Tier 5: Offsets alone or in combination with the above to achieve target significance screening level. Offsets provided for 30-year project life, unless project life limited by permit, lease, or other legally binding conditions. 1665 of 2287
Appendix B Summaries of Working Group Meetings
B - 11 October 2008
Compliance Option 1 – is essentially the same as the previously recommended, except that the target objective has been changed from reducing GHG emissions 40 percent below BAU to 30 percent below BAU to be more consistent with AB 32 target objectives.

Compliance Option 2 - – no change from the previous proposal.

Compliance Option 3 – this is a new compliance option and consists of establishing sector-based performance standards. For example, it may be possible to use the 1990 inventory required under AB32 to establish an efficiency standard such as pounds per person, pounds per worker, pounds per square feet, pounds per item manufactured, etc. When calculating GHGs from a project, if they are less than the established efficiency standard the project would not be significant relative to GHG emissions, while projects exceeding the efficiency standard would be significant.

Projects that cannot comply with any of the compliance options in Tier 4 would then move on to Tier 5.
• Tier 5 – consists generally of the Tier 3 compliance option 3 from the previous staff proposal. The only difference is that the project proponent would be required to provide offsets for the life of the project, which is defined as 30 years. If the project proponent is unable to obtain sufficient offsets, incorporate design features, or implement GHG reduction mitigation measures, then GHG emissions from the project would be considered significant.

WORKING GROUP MEETING #5 (AUGUST 27, 2008)
Subsequent to Working Group meeting #3, SCAQMD staff received feedback on the revised staff proposal #2. Issues and concerns raised by the stakeholders on the initial staff proposal were addressed at the third Working Group meeting and are summarized in the following bullet points.
• A recommendation was made to modify the target objective of Tier 5 to be consistent with the target objective of Tier 4 compliance option 1, that is require emissions to be offset 30 percent from BAU rather than offset down to the screening level. • A Working Group member asked for clarification on the early implementation of applicable AB 32 Scoping Plan measures in Tier 4-Option 2. In addition, a question was asked regarding whether or not this compliance option was applicable after the requirements of AB 32 have become effective.

At Working Group meeting #5, staff presented revised staff proposal #3, which consisted primarily of minor refinements to the previous tiered decision tree approach 1666 of 2287
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B - 12 October 2008
in revised staff proposal #2. The components of revised staff proposal #3 are shown graphically in Figure B-4.

Aside from changing the graphic layout of the staff proposal to make it easier to understand, revised staff proposal #3 has only one minor modification. A second energy efficiency requirement has been added to the screening level in Tier 3. In addition to requiring projects to go a certain percentage beyond Title 24, projects would also have to reduce by a specified percentage electricity demand from water use, primarily electricity used for water conveyance.
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B - 13 October 2008
Figure B-4
Revised Staff Proposal #3 Tiered Decision Tree Approach – August 27, 2008 1668 of 2287
international energy agency
agence internationale de l’energie

ENERGY EFFICIENCY REQUIREMENTS

IN BUILDING CODES, ENERGY EFFICIENCY

POLICIES FOR NEW BUILDINGS
IEA Information paper
Mr. Jens LAUSTSEN
International Energy Agency
© OECD/IEA, March 2008
In Support of the G8 Plan of Action
1669 of 2287

INTERNATIONAL ENERGY AGENCY
The International Energy Agency (IEA) is an autonomous body which was established in November 1974 within the framework of the Organisation for Economic Co-operation and Development (OECD) to implement an international energy programme.

It carries out a comprehensive programme of energy co-operation among twenty-seven of the OECD thirty member countries. The basic aims of the IEA are:
n To maintain and improve systems for coping with oil supply disruptions. n To promote rational energy policies in a global context through co-operative relations with non-member countries, industry and international organisations. n To operate a permanent information system on the international oil market. n To improve the world’s energy supply and demand structure by developing alternative energy sources and increasing the efficiency of energy use. n To promote international collaboration on energy technology. n To assist in the integration of environmental and energy policies.

The IEA member countries are: Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Japan, Republic of Korea, Luxembourg, Netherlands, New Zealand, Norway, Portugal, Slovak Republic, Spain, Sweden, Switzerland, Turkey, United Kingdom and United States. Poland is expected to become a member in 2008. The European Commission also participates in the work of the IEA.

ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT
The OECD is a unique forum where the governments of thirty democracies work together to address the economic, social and environmental challenges of globalisation. The OECD is also at the forefront of efforts to understand and to help governments respond to new developments and concerns, such as corporate governance, the information economy and the challenges of an ageing population. The Organisation provides a setting where governments can compare policy experiences, seek answers to common problems, identify good practice and work to co-ordinate domestic and international policies.

The OECD member countries are: Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, Republic of Korea, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Spain, Sweden, Switzerland, Turkey, United Kingdom and United States.

The European Commission takes part in the work of the OECD.© OECD/IEA, 2008 International Energy Agency (IEA),
Head of Communication and Information Office,
9 rue de la Fédération, 75739 Paris Cedex 15, France.

Please note that this publication is subject
to specific restrictions that limit its use and distribution.

The terms and conditions are available online at
http://www.iea.org/Textbase/about/copyright.asp
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3 ABSTRACT
The aim of this paper is to describe and analyse current approaches to encourage energy efficiency in building codes for new buildings. Based on this analysis the paper enumerates policy recommendations for enhancing how energy efficiency is addressed in building codes and other policies for new buildings. This paper forms part of the IEA work for the G8 Gleneagles Plan of Action.

These recommendations reflect the study of different policy options for increasing energy efficiency in new buildings and examination of other energy efficiency requirements in standards or building codes, such as energy efficiency requirements by major renovation or refurbishment.

In many countries, energy efficiency of buildings falls under the jurisdiction of the federal states. Different standards cover different regions or climatic conditions and different types of buildings, such as residential or simple buildings, commercial buildings and more complicated high-rise buildings.

There are many different building codes in the world and the intention of this paper is not to cover all codes on each level in all countries. Instead, the paper details different regions of the world and different ways of standards. In this paper we also evaluate good practices based on local traditions. This project does not seek to identify one best practice amongst the building codes and standards. Instead, different types of codes and different parts of the regulation have been illustrated together with examples on how they have been successfully addressed.

To complement this discussion of efficiency standards, this study illustrates how energy efficiency can be improved through such initiatives as efficiency labelling or certification, very best practice buildings with extremely low- or no-energy consumption and other policies to raise buildings’ energy efficiency beyond minimum requirements.

When referring to the energy saving potentials for buildings, this study uses the analysis of recent IEA publications, including the World Energy Outlook 2006 (WEO) and Energy Technology Perspective (ETP). Here, we based the estimates of potentials on the scenarios presented, in particular on the predictions of consumption in the residential and commercial sectors in the WEO 2006.

Finally, this paper recommends policies which could be used to realise these large and feasible energy saving potentials in new buildings, and the use of building codes by renovation or refurbishment.

The paper addresses as well experts as policy makers and interest groups with particular interest in energy efficiency in new buildings. Some parts might hence seem simplified and known for some experts, such as the discussions on barriers or the climatic impact on efficiency. Other parts might on the other hand seem a little technical for the policy oriented reader or for some interest groups. But there are large and compelling opportunities, this is recognised by many experts as well as there is a will to act by many policymakers and governments. But still too little happen because there are barriers and low understanding also in the institutional parts or little communications between different layers of the implementation process.

The paper hence aims to bridge these gabs by addressing several different groups at the same time. So hopefully the reader will accept these inconveniences. 1671 of 2287
4 TABLE OF CONTENTS
Energy Efficiency Requirements in Building Codes, Energy Efficiency Policies for New Buildings
1 Introduction ........................................................................................................................ 7

1.1 The rationale for energy efficiency in building codes .................................... 7

1.2 Energy use in buildings ......................................................................................... 8

1.3 Energy efficient buildings benefits society .................................................... 10

1.4 Energy efficiency in new buildings .................................................................. 11

1.5 Energy efficiency is not just a choice for the individual owner ................. 11

1.6 Efficient new buildings make efficient existing buildings ........................... 11

1.7 Conclusion - The need for energy efficiency requirements for new buildings ....................................................................................................................................... 12 2 Building codes and standards ........................................................................................ 13

2.1 National or regional levels................................................................................. 13 3 Energy efficiency requirements in building codes .................................................... 14

3.1 Setting energy efficiency requirements .......................................................... 14

3.2 International trends in energy efficiency requirements for new buildings16 4 Barriers to energy efficiency in new buildings........................................................... 16

4.1 If it is feasible, why is it not done? .................................................................. 16

4.2 Inertia against efficient buildings .................................................................... 18 5 Regulation of energy efficiency in new buildings...................................................... 19

5.1 Building envelope ................................................................................................ 20

5.2 HVAC systems ....................................................................................................... 22

5.3 Renewable Energy ............................................................................................... 23

5.4 Installed equipment ............................................................................................ 25

5.5 Zoning of buildings .............................................................................................. 25

5.6 Integrated design ................................................................................................ 26

5.7 Conclusion ............................................................................................................ 26 6 Types of regulation ......................................................................................................... 26

6.1 Prescriptive .......................................................................................................... 27

6.2 Trade-off ............................................................................................................... 27

6.3 Model Building...................................................................................................... 27

6.4 Energy Frame ....................................................................................................... 28

6.5 Energy Performance ........................................................................................... 28 1672 of 2287
5 6.6 Mixed models, hybrids ........................................................................................ 29

6.7 Development ........................................................................................................ 29

6.8 How to compare .................................................................................................. 29

6.9 Conclusion ............................................................................................................ 30 7 Conditions for Building Codes, Comparison ................................................................ 31

7.1 Climatic classifications ....................................................................................... 32

7.2 Simplifications of climatic conditions ............................................................. 33

7.3 Valuation of building codes ............................................................................... 34 8 Least Lifetime Costs........................................................................................................ 34

8.1 Methodology ......................................................................................................... 35

8.2 Energy efficiency optimum ................................................................................ 35

8.3 Indicators for efficiency in new buildings ...................................................... 37 9 General status in regions ............................................................................................... 38

9.1 Europe ................................................................................................................... 38

9.2 North America ...................................................................................................... 42

9.3 Japan ..................................................................................................................... 48

9.4 Australia, New Zealand ...................................................................................... 52 10 Developing Countries .................................................................................................... 52

10.1 China .................................................................................................................... 52

10.2 India ..................................................................................................................... 53 11 Comparison of U-values in OECD countries .............................................................. 54

11.1 Methodology ....................................................................................................... 54

11.2 Possible misinterpretation of the values ...................................................... 56

11.3 Comparison ceilings .......................................................................................... 57

11.4 Comparison walls .............................................................................................. 57

11.5 Comparison floors ............................................................................................. 58

11.6 Comparison windows ........................................................................................ 58

11.7 Overall comparison of prescriptive values ................................................... 60

11.8 Comparisons Cooling Based Climates and Energy Performance ............... 62

11.9 Conclusion .......................................................................................................... 62 12 Enforcement, encouragement .................................................................................... 63

12.1 Why are carrots and sticks needed? .............................................................. 63

12.2 Enforcement systems ....................................................................................... 63

12.3 Encouragement systems ................................................................................... 64 1673 of 2287
6 13 Beyond the Building Codes .......................................................................................... 64

13.1 Low Energy Buildings ........................................................................................ 65

13.2 Passive Houses ................................................................................................... 66

13.3 Zero Energy Buildings ....................................................................................... 71

13.4 Green Buildings and Sustainable Buildings ................................................... 73 14 Dynamic Building Codes ............................................................................................... 74

14.1 Building codes have to be changed over time ............................................. 74

14.2 Toward Zero energy as building code ........................................................... 75 15 Potentials for energy efficiency in new buildings ................................................... 76

15.1 Conclusion on potentials in new buildings.................................................... 77 16 Refurbishment and renovation ................................................................................... 77

16.1 Potentials for efficiency by refurbishment .................................................. 78

16.2 Conclusion on potentials in refurbishment of existing buildings.............. 79 17 Conclusion potentials ................................................................................................... 79 18 Recommendations ......................................................................................................... 80 19 References: .................................................................................................................... 83

19.1 Publications ........................................................................................................ 83

19.2 Web Pages .......................................................................................................... 84 1674 of 2287
7 1 Introduction

1.1 The rationale for energy efficiency in building codes The use of energy in buildings accounts for a large share of the total end use of energy.

In sectors such as residential and the commercial sector the major part of the energy consumption takes place buildings. This includes energy used for controlling the climate in buildings and for the buildings themselves, but also energy used for appliances, lighting and other installed equipment.

In other sectors a small part of the energy consumption is similar used for similar purposes in relation to the buildings. This is for instance the case for some buildings in the industry used for administration or some buildings agriculture or forestry.

Figure 1. Energy consumption in different sectors.

According to the IEA statistics for energy balance for 2004-2005,( 2007 edition), the total final energy use globally accounts for 7209 Mtoe (Mega Tonnes Oil Equivalents).The residential and commercial sectors account for respectively 1951 Mtoe and 638 Mtoe, which is almost 40 % of the final energy use in the World1. The major part of this consumption is in buildings.

The energy efficiency of new buildings determines the building sector’s energy consumption for far longer than other end-use sectors components determine their sector’s efficiency. Buildings will typically be constructed to be used for many decades and, in some cases, for more than a hundred years. In other energy end uses, the capital lifetime for efficiency improvement will be, at most, a few decades.

Improvement of buildings’ efficiency at planning stage is relatively simple while improvements after their initial construction are much more difficult: decisions made during a building’s project phase will hence determine consumption over much, if not all, of a building’s lifetime. Some measures to improve efficiency are possible only during construction or by major refurbishment, likely to happen only after several decades. Other

1 The end use of energy alone in the residential and the commercial sector is equivalent to 108.4 Ej (exajoules). 1 single exajoule equals 1000 Pj (petajoules) or 1018 joules. 1675 of 2287
8 improvements will be very cost effective or maybe even free or at negative costs when implemented at project stage, but can be expensive at a later stage.

Energy efficiency requirements in building codes or energy standards for new buildings are therefore among of the most important single measures for buildings’ energy efficiency.

This is in particular the case in times of high construction activity or in fast developing countries.

The importance of energy efficiency requirements in building codes or standards extends beyond their role in new buildings. Building codes and efficiency standards often serve as the efficiency target for refurbishment or other improvements of existing buildings. Buyers and renters of buildings or units will often compare new and existing buildings. With increased interest for efficiency will high requirements in building codes therefore spur the demand for refurbishment or general improvements of existing buildings.

As buildings have a relatively long life major refurbishments will necessarily take place during their lifespan – which can be around every 30 – 40 years for residential buildings.

This will take place because major parts of the buildings and installations will be worn-out and have to be replaced, and because lifestyle and demands for comfort are constantly changing in a modern society. Replacements and smaller refurbishments might even occur more often. These refurbishments or change of equipment provide a compelling opportunity to improve a building’s efficiency. Energy saving can often be obtained at lower costs when other construction take place; in some cases, additional improvements require only small or no additional funding if the basic construction requires work or equipment is replaced, in other cases it can save construction costs, scaffolding etc.

Requirements for energy efficiency by refurbishment are therefore an important issue which should be included in building codes.

1.2 Energy use in buildings
Energy is used in buildings for various purposes: heating and cooling, ventilation, lighting and the preparation of hot sanitary water among them. In residences and commercial buildings, installed equipment and appliances require energy, as do removable devices like mobile phone chargers and portable computers. However, identification of fixed and fluctuating demand for energy rarely appears in a building’s consumption metric, as most measurement consider only the total amount consumed by the whole building.

Subdivision of energy consumption can be particularly difficult in the cases of electricity, where air-conditioners, appliances, lights, pumps and heating installations all draw electricity and often from the same metering. Natural gas, too, can serve several end uses at once, including heating, cooking, and the provision of sanitary hot water.

Given the difficulty in subdividing buildings' energy requirements and the use of different fuel types, most analysis examines energy use in building as defined by end-use: space heating, cooling, cooking, etc. The split in use of energy will be due to uncertainties and it will vary with different types of building and also with the age and use of the buildings. 1676 of 2287
9 Figure 2. Energy use in residential buildings.

Source: 30 Years of Energy Use in IEA countries. A large part of the energy consumption in residential buildings are used for direct building related use such as space heating, which accounts for more than 50 % in selected IEA Countries.

These differences in the use of energy in different countries can best be illustrated by a subdivision of energy consumption in residential buildings, which is the most homogenous type of buildings.

Figure 3. Subdivision of energy consumption in residential buildings in select IEA countries.
0 5
10 15
20 25
30 35
40 45
50 1990 Austria 2004 1990 Canada 2004 1990 Denmark 2004 1990 Finland 2004 1990 France 2004 1990 Germany 2004 1990 Italy 2004 1990 Japan 2004 1990 Netherlands 2004 1990 New Zealand 2004 1990 Norway 2004 1990 Spain 2004 1990 Sweden 2004 1990 United Kingdom 2004 1990 United States 2004 GJ per capita (normalised to 2700 HDD) Space heating
Water heating
Cooking
Lighting
Appliances
Total (not
normalised)
Source: 30 Years of Energy Use in IEA countries2. As illustrated, the use of energy is different in individual countries both in concern of level as in the subdivision. The graph also shows issues on comparison and normalisation, which will be targeted later in this paper.

2 The different indicators set by the Energy Use in the new Millennium in IEA Countries are currently being reexamined in the context of an ongoing IEA indicator study. The consumption in buildings is highly dependent on price levels and local traditions and some of these are further discussed in the study. 1677 of 2287
10 Building-related end-uses - heating, cooling, ventilation and the preparation of hot sanitary water - require approximately 75% of a residential building’s energy demand. Building codes generally address these drivers of building-related consumption. Only more occasionally, codes cover other end-uses like lighting in service buildings, though this varies by country, as discussed later in this paper. For service buildings, the share of energy use for other purposes will often be larger and for some types of service buildings it can be more than 50%.

1.3 Energy efficient buildings benefits society
Energy consumption in buildings is a large share of the world’s total end use of energy. In member states of the OECD, residential and commercial buildings require approximately 35 % of the end use of energy in addition to this energy is used for buildings also in the industry. Globally, buildings account for close to 40% of total end use of energy. Given the many possibilities to substantially reduce buildings’ energy requirements, the potential savings of energy efficiency in the building sector would greatly contribute to a societywide reduction of energy consumption. The implications of such potential reduction should not be underestimated, as the scale of energy efficiency in buildings is large enough to influence security policy, climate preservation and public health on a national and global scale.

By reducing buildings’ energy consumption, a nation can reduce dependency on imported energy and strengthen its strategic position. In the 2000 Green Paper setting forth a strategy to secure energy supply3, the European Union named energy efficiency as the best way to establish energy security over a longer term. Different IEA scenarios show similar trends.

Moderation of energy-end use in buildings will also reduce greenhouse gas emissions and pollution produced by the combustion of fossil fuels. This environmental benefit appears on two scales, local and global. Because much of buildings’ demand for energy requires local energy combustion in individual heating systems or district heating, reduced energy demand improves air quality at the local level. In particular in developing countries a reduced demand for energy requires fewer power plants, thereby delaying or obviating the construction of new generation and grid capacity and enabling communities to devote public funds elsewhere.

Given the potential scale of energy savings across the building sector, reduced demand for energy and fossil fuels can substantially contribute to a nation’s compliance with domestic or supranational targets for the reduction of greenhouse gas emissions.

When adequately ventilated, energy efficient buildings are generally healthier than traditional buildings. Relative to traditional buildings, energy efficient buildings offer a more stable indoor climate, with less draught from windows, walls, floors, and ceiling constructions. Because residents of energy efficient buildings must spend relatively less to heat and cool their homes to within the margins of acceptable comfort, energy efficient construction reduces fuel poverty4 across society. As households demanding less energy for building-related uses, they burn less fuel locally, thus doubling the potential to improve public health and otherwise benefit local communities.

Among these potential public benefits of energy efficiency in buildings, employment in the construction sector should not be dismissed. As extensively documented on the European

3 European Union, Green Paper of 29 November 2000, "Towards a European strategy for the security of energy supply".
4 Fuel Poverty describes the dynamic in which the high cost of creating a standard level of indoor comfort requires an unsustainable portion of a household’s budget. Rather than pay the energy costs, households choose to instead reduce indoor comfort to below normally-accepted limits. 1678 of 2287
11 level for instance by EURIMA/Ecofys studies, energy efficiency in buildings creates jobs – an estimated half-million new positions in the European construction sector, were higher efficiency to be regulated.5

1.4 Energy efficiency in new buildings
Many means to save energy in new buildings also offer the potential to save money.

Individual homeowners and building users investing in energy efficiency will often recover costs in a short period through lower energy expenses. This “payback time” on energy efficiency investment can be as short as a few years. These energy savings are similarly profitable from the macro-economic perspective of national policy. Increased efficiency in new buildings is hence profitable for individual building owners and society as a whole.

Though the construction activity in OECD countries is relatively low, the energy saving potential of new buildings remains large. This potential accumulates year by year because of the long lifetime of buildings: most buildings constructed today will remain in use until after 2050. Logically, new buildings present a good opportunity to save energy over the long term.

In many developing countries, new constructions accounts for a larger share of the buildings. In these countries, such as China and India, the energy savings by energy efficiency in new buildings will have a larger and faster impact on the economy and result in larger savings than in OECD nations. In developing countries a high consumption in new buildings will increase the demand for new supply and grid capacity. In these nations, the general benefit of improved efficiency in new buildings can be seen more quickly and will be felt more profoundly.

1.5 Energy efficiency is not just a choice for the individual owner Because the efficiency of a new building will influence its energy consumption until renovation or even the whole lifetime, the decisions taken during design and construction will influence decades of building use. Lost opportunities in the construction phase will lead to increased costs if done at a later stage and can wildly inflate the running costs for future users. While individuals continue to determine much about a building’s fate, the energy efficiency of a new building should not be viewed only as a matter for individual choice but as a more collective issue, influencing society at large and a future generation of building users.

Some improvements of energy efficiency in new buildings might require a need for development of new solutions or for training of builders or installers, which it is too complicated or costly for the individual owner or constructor to carry in connection to one or a few projects. These solutions might still be cost efficient when first developed and training has taken place. There is therefore a need for overall actors to take the responsibility to drive the development of efficient technologies and buildings, which will reduce costs in the long term and increase the potentials when improved solutions or products penetrate the market.

1.6 Efficient new buildings make efficient existing buildings New buildings become existing buildings and all existing buildings were once new, hence will the efficiency of new buildings determine the efficiency of existing buildings over time.

Exactly when a new building enters into the stock of existing buildings varies by legislation.

In some jurisdictions, the “new” designation applies to a building only until the first day of

5 Several EURIMA reports on Cost-Effective Climate Protection in the EU Building Stock, WWW.EURIMA.org. 1679 of 2287
12 its use; in other areas, certification of a “new” building is valid for up to 10 years.6A change in legislation, such as increased energy efficiency requirements, will typically force the conclusion that buildings constructed before the date of promulgation must be considered to be existing buildings.

New buildings are rarely improved or renovated in the first years. The efficiency of new buildings will therefore directly influence the consumption for many years and they will be the standard for improvement of existing buildings, since renovation projects often aim to bring buildings up to the present standard. Efficiency demands for new buildings then becomes the driver also for existing buildings. This dynamic is in particular visible in countries with a long tradition of energy efficiency requirements for new buildings, where there is a substantial supply of more efficient existing buildings on the market. This process can be supported by energy labelling or certification schemes where new and existing buildings are compared as required in most members states of the European Union7.

The presence of efficient new buildings also influences the decisions made for. Occurring at 30-40 year intervals during a building’s lifespan, major renovations or refurbishment aim to repair and replace parts of a building, such as windows and installed equipment following decades of use and in the context of new technology and demands for functionality. In general, these renovations aim to meet the energy efficiency requirements currently in force and applied to new constructions. Thus, strong regulations for highly efficient constructions influence the efficiency of both new and existing buildings. In recognition of this, building codes sometimes include energy efficiency requirements specific to renovations or major refurbishment and enlargements of the buildings8.

Requirements for highly-efficient new constructions also influence the market for products typically installed in buildings, promoting energy efficient models of windows, boilers, pumps and air-conditioners. Once on the market, these products may become standard in both new and renovated buildings. The way in which energy efficiency regulations for new buildings can open the product market to efficient equipment and catalyse the eradication of inefficient products can be observed in the disappearance of single-glazed windows and non-condensing gas boilers from German, Dutch and Danish markets.

1.7 Conclusion - The need for energy efficiency requirements for new buildings Given the long lifespan of most buildings, the relative energy efficiency of new buildings will influence energy consumption for many years. Construction of buildings offers compelling opportunities for energy efficiency, as decisions made during a building’s design phase entail smaller costs with greater potential energy savings relative to later intervention.

If decided upon in the early design phase, energy efficiency is often considerable less expensive since increased insulation will have only marginal costs for the increased layers of insulation, increased thickness of construction or increased efficiency in appliances.

Some efficiency improvements may even reduce construction costs because the efficient solutions are more cost effective or because the need for heating or cooling systems might be reduced.

Decisions which entail no or very low cost at the early project stage include the form of the building, its orientation, the orientation of its windows, and its structural materials. When

6 Certification for new buildings is valid for 10 years according to the European Directive on Energy Performance in Buildings.
7 It is a demand in the directive on Energy Performance of buildings that all new buildings have to be certified. 8 California building codes and the EU Directive on the Energy Performance of Buildings both specify efficiency requirements for building refurbishment. The International Model Building Codes, used in the US and Canada, also include requirements for renovation.
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13 included during the design phase, energy efficiency improvements can reduce the demand for and costs of cooling and heating systems. These same decisions, when made after construction, can be prohibitively costly to enact. In other cases, improvement of energy efficiency late in a building’s construction would involve irreparable damage to its structure. Examples of this are rebuilding massive concrete floors placed directly on the ground, hidden pipes or foundations with heat losses. Even when energy improvements are suggested at the late planning phase of a building, it is still preferable compared to introducing them after construction.
2 Building codes and standards
Energy efficiency requirements in building codes can ensure that concern is taken for energy efficiency at the design phase and can help to realise the large potentials for energy efficiency in new buildings. Energy efficiency requirements for new buildings are set in different ways. Based on national or local traditions they can either be integrated in the general building codes or standards for new buildings, or they can be set as separate standards for energy efficiency.

This paper addresses both energy requirements set in building codes and in separate energy standards for buildings. It is generally not the intention to differentiate between requirements in building codes and requirements set in legislation specifically concerning the energy efficiency of buildings. The terms “building codes” or “energy standards” for new buildings generally refer to energy efficiency requirements for new buildings whether they are set in building codes, specific standards or other ways, unless otherwise stated.

This analysis does not support the superiority of either method. Instead, this paper indicates the implications of each type of code for its enforcement. When energy efficiency requirements are set as part of the general rules, it is natural to include their enforcement in the general system for building approval, while separate energy standards impose a separate system for energy efficiency enforcement.

2.1 National or regional levels
In some countries, building codes and standards for energy efficiency are set at a national level. In countries with large climatic differences the national building codes might includes values which are adjusted to the local conditions. These are referred to as national building codes. In other countries, local states or regions establish energy efficiency requirements in buildings. This applies in particular to large countries with a federal government. In this case, a model building code is often developed to cover the whole country, either on a public or as a private initiative9. Individual states or regions then modify the national model standard to local conditions; and must adopt this legislation, before it becomes mandatory.

Finally, some countries delegate the establishment of energy efficiency requirements for buildings to local authorities. In this case, the city council, regional government or federal state may autonomously set and enforce standards. This independent governance is now quite rare, particularly in OECD countries, where energy efficiency is seen to be far too important from a national perspective. Countries where codes are set on a local level will usually have a standard set on national level and the recommendation to adopt or adjust the standard locally.

9 In US the ASHRAE and IECC codes are developed by private organisations but with a large participation from the national authorities. See later in the paper for a further description of these model codes. 1681 of 2287
14 3 Energy efficiency requirements in building codes
Building codes are not a new invention and building codes or standards for new buildings address several concerns, such as construction safety, fire safety and occupants’ health.

One of the earliest examples of regulations for buildings is Hammurabi’s law from Mesopotamia, established around 1790 BC. Among the 282 rules or contracts, which regulated every part of society, six concern the construction of houses and the penalties for builders.

Many countries or cities have hence a long tradition of setting rules for constructing of new buildings, often initiated in response to disasters such as a large urban fire, an epidemic or a natural catastrophe such as an earthquake. Requirements for constructing buildings were then set in order to avoid or minimise future disasters. Compared to this energy efficiency regulation for new buildings is relatively new in most countries.

Early energy efficiency requirements for buildings responded to poor insulation levels which could lead to health problems because of moisture or air-infiltration. Most regulations for energy efficiency in buildings before the oil crises in 1973/74 are from northern regions with cold winters, where the climate can considerably influence public health.

Requirements on specific constructions with some thermal characteristics in these regions first appeared during the period between the two World Wars, when some countries regulated the introduction of simple insulation in the form of air layers in cavity walls or double layer floors of timber beam.

The first real insulation requirements for U-values 10 , R-values 11 and specific insulation materials or multi-glazing, date back to the late 1950s and the early 1960s in Scandinavian countries. These national requirements were intended to improve energy efficiency and comfort in buildings. Comfort was the prime motivation for raising the requirements – in a reflection of increasing standard of living, people wanted better and improved living conditions.

In many countries, the oil supply crisis of the early 1970s catalysed the development of energy efficiency requirements for buildings. Those countries already enforcing efficiency regulations generally raised their requirements during the early 1970s to further reduce energy consumption and decrease dependency on oil. During the 1980s and 1990s, energy efficiency requirements were set or increased in most OECD countries. In part, this new legislation responded to the Kyoto Protocol, or other targets to reduce or stabilise CO2 emissions.

Today, mandatory minimum energy efficiency requirements in the form of building codes or standards exist in nearly all OECD countries. However, substantial differences persist between legislation of the states, regions and cities.

Regulations for energy efficiency in buildings in developing countries, and especially in rapidly developing countries such as India and China, seeks to improve comfort and to reduce the dramatic increase in energy consumption in this sector with the economic capacity to install cooling or heating systems.

3.1 Setting energy efficiency requirements
When requirement for energy efficiency are set in a separate standard they are less bound by other building rules and can contain more samples and specific documentation of

10 U-value: thermal transmittance is a technical value describing how much energy passes through one m² of a construction by a difference of one degree in temperature, measured in W per K per m2. 11 R-value: thermal resistance describes how well a construction or insulation material resists the penetration of heat, measured in K * m² per W. The (U value) = 1 / (R value). 1682 of 2287
15 potential use for contractors or building designers. However, as separate standards, they require their own enforcement system.

Energy efficiency requirements included in buildings codes are usually set in a specific chapter and enforced along with the general rules of the building codes. If the building industry is familiar with general requirements in the building codes, integrating efficiency requirements can efficiently inform industry actors of energy conservation measures.

Energy efficiency requirements included in building codes are often brief, while specific standards are typically longer and more comprehensive.

Some countries mix both approaches by referring to standards. For example, in Germany, general building regulations refer to many specific DIN12 standards. In many other countries specific guidelines to describe calculation rules and possible use accompany building codes such that the general rules appear in the building code, while standards contain specific details. Many jurisdictions refer to national, CEN13 or ISO standards.

Impact of minimum energy efficiency standards
Most OECD countries regulate energy consumption in new buildings by setting minimum energy efficiency requirements in buildings codes or in a separate regulation. Several examples illustrate these regulations’ impact on energy efficiency in new buildings.

Figure 4. Actual energy consumption in single family houses in Denmark, relative to energy efficiency requirements in building codes.

The results of energy certification of more than 200.000 buildings the average consumption over each decade are compared with energy efficiency requirements in the building codes. 14

12 DIN is “Deutche Institut für Normung“: German institute for norms and standards. 13 CEN, European Committee for Standardisation, is currently developing 31 international standards for calculation of energy performance in buildings to be used in connection with directives from the European Union.
14 SBI rapport om Varme Besparelser i Boliger, 2003 – heat savings in residential buildings. Information energy consumption in new buildings is also calculated by SBI, The National Building Research Institute in Denmark. 1683 of 2287 16 In 1961 Denmark established one of the first building codes which systematically regulated energy consumption. Since then, building codes have been updated several times, including major changes in 1972, 1979, 1997, and in 2006. As illustrated in Figure 4, studies of existing buildings track the trend of declining energy consumption in the context of rising efficiency requirements. The results of early regulations to improve thermal comfort, policies taken in the 1930s and 1940s to ensure construction of cavity walls and double layer beam floors in large residential buildings can be seen too. The lapse between lapse between promulgation of new requirements and their full implementation in the building sector can be seen too, evidence of insufficient enforcement and information.

A similar trend is shown in other countries: buildings’ improved energy performance follows the introduction and strengthening of building codes with lapse between promulgation and improvement corresponding to the strength of local law enforcement.

3.2 International trends in energy efficiency requirements for new buildings Though most energy efficiency requirements in building codes followed local, state or national tradition, the past decade has shown a trend in supranational collaboration to develop international energy efficiency requirements or standards. Examples are the US based Energy Efficiency standards (IECC 200415 and ASHRAE 200416) which are used in US and Canada, and the European Energy Performance in Buildings Directive (EPBD) that required member states of the European Union to establish requirements for energy efficiency in new buildings, effective January 2006. To supplement the EPBD, the European Union aims to establish a model building code for energy efficiency for the European region (2006 EU Action Plan for End-use Efficiency) and to develop CEN standards for energy performance calculation. These CEN standards are on the way to be amended and adopted as ISO standards too.

Most countries have started with one common standard for energy efficiency, but have over time developed separate standards for small and simple residential buildings and for large, complex or non residential buildings, in consideration of the dissimilar energy performance. 4 Barriers to energy efficiency in new buildings

4.1 If it is feasible, why is it not done?
Many barriers impede energy efficiency in buildings, and perfect function of the building sector market in economic terms. Insufficient information, insufficient finance for efficiency improvement, split incentives, users’ lifestyle choices and multiple decision makers all hamper buildings’ efficient performance. Among the building sector’s barriers to efficiency, some are specific to new buildings.

When buildings are designed and constructed, energy efficiency is but one concern amid many, some considered more urgent by decision-makers. These can be structural or fire safety, room size, and even the view from the windows. Energy efficiency in buildings may hence be low on the list of requirements.

Focus on incremental costs
Those involved in building projects tend to emphasize investment and construction costs without due consideration of buildings’ future running costs. Often these involved parties only have a direct interest in the construction budget and not the total budget, and may be

Each of the 200.000 buildings was inspected by energy consultants and energy consumption calculated based on similar conditions as are used in building codes.
15 IECC 2004, International Energy Conservation Code for residential buildings. 16 ASHRAE 2004, American Society of Heating Refrigerating and Air Conditioning Engineering. 1684 of 2287
17 unwilling or unable to evaluate future costs, including those for energy and other resources.

Few actors involved in a building’s construction have the training required to analyse a building’s lifecycle costs and guide construction practices to improve future efficiency. The known costs of construction are thus considered more carefully than unknown future costs.

Construction decision makers not interested in future costs Many large buildings are constructed by professional developers and most single family houses by construction companies. After construction, developers sell the buildings to future occupants or users. Those who make decisions regarding energy performance will most commonly not pay the energy bills. Building occupants, who pay energy bills, are rarely involved in the building design.

Insufficient efficiency awareness among consumers, designers and banks Many different decision makers takes decisions, which can influence the energy efficiency of new buildings such as designers, financers, builders, installers and buyers, but most of these know very little about energy efficiency of buildings. Lack of knowledge in just one of these chains can block for energy efficiency in new buildings.

Most buyers of buildings only buy a few times during their lives. Unpractised buyers may not be mindful of the implications and costs of low energy efficiency and, even if aware, may intervene too late during building construction to promote energy efficiency in new buildings. Energy efficiency might therefore be left up to other actors in the construction of buildings. However, most designers, builders and installers know or care little about energy efficiency.

Because designers and contractors make the initial decisions that influence energy performance, both groups can craft an efficient structure. Too often, however, neither engineers nor efficiency advisors are extensively involved in the early design process.

When evaluating a potential construction project a lending financial institution generally focuses on construction costs without attention to implied future costs for energy. Banks may hence be reluctant to fund investments in measures to improve efficiency, even if these investments are feasible and profitable. Insufficient awareness among financiers of efficiency’s benefits may prove prohibitive to the construction and operation of efficient buildings and the limited scope of this valuation can frame a budget unresponsive to potential reductions in future costs. Consumers and builders that seek energy efficient construction may not be able to obtain the loans to finance efficiency investment.17 Cost structures and lack of capacity
Some energy efficiency measures involve special equipment or expertise not readily available on all markets. Lack of capacity, possible delays due to delivery time or extra fees paid to an expert can deter contractors’ interest in efficient construction and further reduce market interest in efficient products or techniques. In addition, some builders are unwilling to invest in training.

Split incentives, brief occupancy and efficiency’s marketing difficulties Decisions regarding the energy performance of many buildings are often split between building owners or constructors, who would be required to pay for efficiency investments, and building occupants, who would reap the rewards of lower running costs for energy.

Total costs might be reduced by efficiency, but because it is split on different persons it might be rejected.

17 Financing Energy Efficient Homes: Existing Policy Responses to Financial Barriers, Philippine de T’Serclaes, IEA 2007.
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18 In buildings such as shops or flats, occupancy time can be short: some buildings are seen as short term investments. Since investments in energy efficiency in buildings are often only profitable over a longer term, few of these conservation options are explored when buildings or units are rented or even bought for a short period.

Transaction of new and existing buildings too rarely considers the avoided costs of energy efficiency. In part, this reticence is due to the fact that the complex calculation of future savings includes several uncertainties, such as future energy prices and real estate market fluctuations. Owners who invest in higher energy efficiency cannot be sure of making a profit or even just recovering initial investments when re-selling the building.

4.2 Inertia against efficient buildings
In addition to these classic economic barriers there is also inertia in the building sector, in which economically-irrational attachment to aspects of a consumer’s lifestyle biases a consumer against energy efficient choice in buildings. For reasons of status, marketing and social ritual, individuals and companies use more energy than basic comfort might require.

Relative to these conditions, economic optimisation may have a far lower rank in the mind of the energy consumer or building owner.18
Energy is invisible
The use of energy is often physically invisible to consumers. Only the status and comfort of using energy will be visible to the energy buyers themselves and to others. A building that does not require air-conditioning might be comfortable and cheap to run, but only by installing air-conditioning can owners or developers demonstrate that indoor comfort is a high priority. Some installations or ineffective energy use signal that the users and owners of the building can afford to make a comfortable indoor comfort and care about the wellbeing of building occupants. Even the noise from air-conditioning units can be seen as an added value because this makes comfort visible for owners and guests in hotels or in workplaces.

Some might consider a reduction of energy consumption and increase in efficiency as a decrease in comfort or status. For energy users with a good economic foundation ineffective energy use will not usually influence the lives substantially since energy costs will only be a small part of the overall budget. Increasing energy prices might help to reduce this barrier.

Mistaken beliefs in energy efficiency
Owners of buildings or buyers of new buildings may mistakenly believe that the efficiency of a certain building is very good even if it is not. In particular, buyers may mistakenly believe that new constructions automatically are so much more efficient that there is no need to take any further action. Increased energy efficiency in new buildings will hence not be of concern even despite of feasible and compelling opportunities. This might hamper increased efficiency in new buildings, because more efficient buildings and products will not penetrate the market since consumers believe that the existing products and building are already efficient enough.

Slogans such as “energy efficient buildings” or “low energy buildings” have been misused in application to new buildings that only just fulfil the energy minimum standards. However, when buyers feel satisfied with their putatively-efficient building, they are less likely to take further action to improve efficiency.

18 Danish Building Research Institute, SBI, Ole Michael Jensen, "Barrierer for realisering af energibesparelser i bygninger” (Barriers to the realisation of energy savings in buildings). 1686 of 2287
19 Building codes set the minimum standard and the maximum Many building buyers interpret the mere existence of building codes to be sufficient warranty for the efficiency of new buildings, but the efficiency standards appearing in building codes rarely represent the optimum for efficiency. Building codes often tend to be the exact level as those for new buildings and not the minimum - which was the original intention of the authority - because builders and designers rarely find an incentive to exceed these efficiency standards which might increase initial costs.

Instead building codes should serve as a common and sure baseline from which to gauge progress and initiatives should be taken to ensure that better energy efficiency would be considered in new buildings.

Barriers work together
Most barriers to energy efficiency in new buildings interact and strengthen each other.

Many initiatives for improved energy efficiency in buildings have returned small or limited results because some barriers have been overlooked or insufficiently addressed. For example, a change in legislation and subsequent information campaigns will fail if building constructors and installers do not have access to sufficient funds for efficiency investment.

A successful policy, or package of initiatives, will simultaneously have to address all major barriers to buildings’ energy efficiency.

Conclusion: Barriers
Many barriers hamper energy efficiency in new and existing buildings. When new buildings are designed and constructed, energy efficiency is but one concern among many factors in construction. Energy efficiency in buildings may be low on the list of requirements for the building. The development of most buildings focuses on construction costs with very little concern for running costs. Different people and budgets may govern the operation of a building, often entailing split incentives for energy conservation. Very rarely will any single decision maker participate in all aspects of a buildings construction, operation and financing. Most decision makers will not have the data or capability to calculate a building’s lifetime costs and estimate the consequences of early design decisions. Consumer inertia regarding buildings’ energy performance stems from the fact that energy is invisible, that the energy costs of new buildings seem imaginary and that improved efficiency can decrease prestige.19

There is hence need to increase awareness of energy efficiency and possibilities for further improvements in new buildings at all levels and to address all barriers simultaneously.

Comprehensive policies are best suited to overcoming these self-compounding barriers. 5 Regulation of energy efficiency in new buildings
Since many barriers hamper energy efficiency in new buildings, there is a strong request for policies which address energy efficiency in new buildings. Energy efficiency requirements for new buildings effectively reduce energy consumption in buildings. Building codes or standards for energy efficiency regulate on the efficiency of the building envelope, including the structures around heated or cooled parts of the building, but often they also regulate the efficiency of different part of the heating, cooling and ventilation system and maybe even other energy using equipment,.

The energy efficiency requirements of the building shell or envelope have historically been the first to be regulated and they are today an essential part of nearly all regulations for energy efficiency in new buildings. The other segments of constructions and installations

19 Further work under the Gleneagles Plan of Action will examine barriers and inertia relative to energy efficiency in buildings. A specific paper will address these barriers in the context of existing buildings. 1687 of 2287
20 that influence a building’s energy performance20 can be addressed in the regulation of energy efficiency, but these parts are more rarely included in the requirements.

5.1 Building envelope
The building envelope is a term for the parts of the building which surround the heated and cooled parts of the building. This includes external walls, floors or ground deck, roofs or constructions towards unheated ceilings, windows and doors. If a cellar is heated then the cellar walls and the cellar floor are part of the building envelope. If it is unheated, the building shell includes the floor between the ground floor and the cellar. The building envelope may also address heat loss through foundations or other thermal bridges.21 Requirements for energy efficiency in external parts of the building, the building envelope, are generally set based on resistance to heat transparency through a unit of the construction, R-values, or a value for the heat transparency through a unit by a specific temperature, a U-factor or a U-value.22 In cold climates, low U-values or high R-values prevent heat from escaping from buildings, and in hot climates they prevent heat from entering buildings. U-values or U-factors will typically be given in w/m² per °C or as Btu / ft² per °F.23

Windows
Windows, doors and other parts of buildings that include glass areas require special attention: beyond its role in insulation, glass provides buildings with daylight and heat from sunlight. In cold climates, solar heat gains can reduce a building’s need for active heating.

In hot climates, however, the heat from sunlight needs to be removed by cooling. The orientation of windows and glass areas should suit the different amounts of light approaching the building from the north, south, each and west and complement a building’s needs for heating and cooling.

Special glass constants (G-values) for windows indicate the amount of sunlight that can penetrate each pane of glass. Calculations for windows can be rather complex and in US and Canada standards for windows include a range of solar heat gain coefficients (SHGC), visible light transmission (VLT) and shading constants (SC).24 There are several methods to improve the efficiency of windows or other glass areas. These include increasing the layers of glazing to double- or triple-glazing, coating the glass, or filling the space between glass plates with an inert gas or a vacuum to reduce heat transfer.

Window frames that position the glass and separate panes also offer the potential for thermal efficiency improvement. The thermal dynamics and lighting potential of windows and glass areas should be considered in specific rules or in calculation procedures.

Shading
Shading, shutters and reflection can greatly reduce sun penetration of windows and other glass areas. Shading is a rather complicated issue which often requires complicated models

20 The energy performance of a building describes the overall energy efficiency of the building in terms of energy consumption by a standardised use.
21 A Thermal Bridge is a construction or a part of a construction that conducts heat more efficiently than the surrounding construction. Cold bridges can be foundations or massive parts of a construction that normally include insulation materials.
22 U-value and R-values are inversely proportional U = 1/R. 23 SI units watt per square meter per degree Kelvin (or degree Celsius) - W/m² per °C - and IP units in Btu per square foot per degree Fahrenheit – Btu/ft² per °F - can be compared because values in SI equals values in IP multiplied by a factor k = 5.6783
24 For further description of window calculations and values such as SHGC, VLT, and SC see the US National Fenestration Council (NFCR). Homepage http://www.nfre.org/. 1688 of 2287
21 which simulate three dimensions. For simple building these models can be complicated to use since they will require many information on the building for and shading parts which have to be calculated with concern of the movement of the sun on the sky in the actual building sight.

Some countries have developed simplified guidelines to be used in connection with more simple buildings and by builders. Figure 5 shows such an example from California.

Figure 5. Solar protection in California

Illustration of solar penetration and shading from the California Energy efficiency standards for low-rise residential buildings.

Air Filtration
Air filtering around windows and glass areas25 creates an indoors draught. When considered thermally, the undesired air filtration is a loss of energy as it requires redundant heating or cooling. Similar filtrations come from the connection of building parts in general and for some constructions such as boards, which have contracted allowing small openings to appear.

Natural air filtration can provide some – in the past maybe even all - required ventilation.

However, ventilation with natural air currents can entail large heat losses from constant air exchange and inconvenient timing and intensity. Natural air filtration is difficult to control and evaluate. Air tightness is often treated separately in building codes and can be assessed in a “blower door test”.26 As buildings become more efficient, air filtration can be one of the major conduits for heat loss in an otherwise highly-insulated building.

25 Filtration of air is used as term for the uncontrolled infiltration of air from outside. This air comes in around windows, in connection between building parts, connection between plates or boards. In old buildings this exchange of air can be substantial.
26 In such a test, a door is replaced with a special device which can put pressure inside the building. It is the metered how to keep the pressure as a value for the filtration. 1689 of 2287
22 5.2 HVAC systems
HVAC systems maintain a building’s comfortable indoor climate through Heating, Ventilation and Air Conditioning (Cooling). These systems profoundly influence energy consumption in buildings. Without heating, cooling and ventilation systems there would be no energy consumption in the building, since it would be totally dependent on outdoor conditions. There is an inverse correlation between the efficiency of the building and the need for HVAC systems: highly efficient building envelopes reduce the need for heating and cooling systems. Good and intelligent designed buildings can reduce or even avoid the need for heating and cooling and reduce the need for ventilation.

Efficiency improvements in HVAC systems can lead to substantial savings, but these savings will also depend on the efficiency of the building in general. If, for instance, energy efficiency is improved in a heating boiler or an air-conditioner, total savings will depend on the total need for heating or cooling in the building. Higher requirements for the building envelope might reduce the potential for savings in HVAC systems. Finally the HVAC systems need to be in a good balance with the buildings in general and they need to be of a proper size which fits with the actual heating, cooling and ventilation needs.

Ventilation
Well-insulated, airtight buildings often require active ventilation to remove used air and introduce fresh air for occupants. Natural ventilation, like the flow of air through open windows, and mechanical ventilation both circulate air. Ventilation can also be included in air-conditioners which combine simultaneous heating and cooling. There are many technologies to improve the efficiency of ventilation systems, including heat exchangers and heat pumps.

For ventilation systems there is a need to be aware of both the energy use in ventilation system it self for fans and preheating of the air etc. but there is also a need to take concern for the heat losses which comes with the exchange of the air. Ventilation systems should hence effectively ensure the necessary air exchange, not more and not less.

Heating systems
Many possible systems can heat a building. Collective heating can include a combined system based on a heating supply in the building such as a boiler or on an external supply in the form of district heating or heating from combined heat and power production. Buildings can also draw heat from individual systems such as electric heaters, heat pumps or individual ovens. Finally, heating can be integrated in the ventilation and air-conditioning systems.

Centralised heating systems include a distribution system in the building such as pipes27, ducts28, tanks, pumps, fans, or exchangers. The efficiency of the overall system depends on the efficiency of all its components, and an efficient boiler can become an inefficient heating system if parts are poorly connected and badly calibrated. In individual systems, the efficiency often depends alone on the efficiency in the heating source only.

Building Codes will often address the efficiency in the system in general and in the components of the system. Some buildings might have multiple systems with a mix of functions, which should all be addressed.

Cooling
To maintain a comfortable and healthy indoor climate, the heat must be removed from overheated buildings. Cooling systems can be centralised or decentralised into small units

27 All pipes for transportation of heated water for the heating of the building and for heating of hot sanitary water.
28 Ducts, all canals to transport air in a cooling, ventilation or air conditioning system. 1690 of 2287
23 installed in every room for instance with small split units which are installed in each room.

For split units, it is mostly the efficiency of the cooling device and the control system which are of importance for the overall efficiency. Within centralised systems, the dimensions and control of the system itself and the distribution ducts both determine energy efficiency. Air tightness is especially important for building cooling, as air leakage can substantially reduce the efficiency of mechanical cooling. Some buildings work with natural cooling or with night cooling, both of which reduce the need for active cooling.

Air Conditioning
Air conditioning systems generally combine the capacity to ventilate, cool, and heat. In a basic definition, an air conditioning system will supply the building with heated air if outdoor temperatures are cold, with cooled air during hot days and with plain air if the building requires only ventilation. For air condition systems, it is primary the efficiency of the overall system and / or components which are regulated, including the heating, cooling and ventilation components.

Dehumidification
In humid climates and in buildings producing much humidity, like swimming halls or other indoor bathing facilities, moisture may need to be removed from inside buildings. Itself an often energy-intensive process, dehumidification can be integrated into air conditioning systems. Building regulations in humid climates, should account for the energy involved in humidity control.

Hot sanitary water
Many buildings’ occupants require hot sanitary water for hygiene, food preparation, cleaning and commercial purposes. The central heating system can provide this water, as can a separate system using electricity, oil, gas, solar thermal energy, heat pumps or district heating. Efficiency regulations often address hot sanitary water.

Ducts and pipes
Because ducts and pipes determine much of the energy efficiency of heating and cooling system, ducts and pipes should be carefully dimensioned, assembled, insulated and placed in the most efficient manner inside or outside the building shell.

Automatic controls
Automatic controls of systems can largely determine or influence the efficiency of these systems. Individual systems as heating, cooling, ventilation or lighting systems can have individual automatics or the overall system can be controlled by one overall central system, which controls all the functions. If the systems are controlled by individual systems this can in some cases lead to conflicts between for instance the heating and the cooling systems.

Good and efficient automatics can ensure the optimal use of the HVAC systems can be addressed.

5.3 Renewable Energy
The use of local sources of renewable energy can be either passive or active. In passive systems the renewable energy is used to avoid the need for heating or cooling while the active systems will transform the energy from for instance the sun or the wind into electricity, heat or cooled energy carriers from which energy is used, as if it came from a non renewable HVAC system.

With a decreasing energy demand in buildings these sources become an important part of the energy performance of the buildings and the more advanced standards include these sources.

Requirements for energy efficiency in buildings and the calculation of energy performance can both address integrated renewable energy systems. These requirements can either be 1691 of 2287
24 set for the renewable energy sources themselves – for example, in a demand for solar heating of sanitary water, as in the case for Spain - or as part of an overall energy performance (see below), where the demands are set for the maximum delivered energy.

Passive Solar
In a building heated by passive solar energy, glass areas are oriented and arranged so as to optimise the capture of solar light and heat. When buildings are highly insulated and energy efficient, passive solar energy can meet a substantial share of the heating demand, even in cold climates.

Because a building’s exposure to solar energy varies over the year and during the day, constructions must be able to store and balance solar energy. Buildings capturing too much heat may require cooling, offsetting the efficiency gains of passive heating. Passive solar heating of buildings requires good models for balancing heating in multiple zones 29 to provide even temperatures throughout the building.

Passive cooling and ventilation
In passive cooling systems natural cool resources for instance in water or in the ground can be used to reduce the need to cool the buildings. Passive cooling systems can also use the fact that the temperature might be colder at night or use different phenomena’s which will cool air or building parts.

In natural or passive ventilation different options are used to avoid active ventilation systems. Natural ventilation is often used in small residential buildings and often these buildings are constructed with out or with very limited use of active or mechanical ventilation. In larger buildings and in particular in service buildings the use of natural ventilation requires a high emphasis in the design phase.

When natural ventilation or passive ventilation is used in large buildings natural sources of wind or airstreams because of difference in temperatures are used to drive the ventilation.

This is typically achieved through an intensive design phase where the shape of the building is adjusted or where specific elements such as special designed windows are introduced.

Passive cooling and ventilation can reduce energy consumption substantially but is difficult and complicated to address in building codes or standards for new buildings.

Active renewable energy systems
In active renewable energy systems the energy from the renewable energy sources are actively transformed into heating, cooling or electricity and the used as energy supply which comes from non renewable HVAC systems. Some of these systems can often be integrated in the buildings or in the building shell.

Solar water heaters are one of the most commonly used renewable energy supplies in buildings and in these systems water is heated by the sun and the heat is stored until used.

Similar systems can be used to heat the building but this increase the need for storage and sometimes even from one season to another.

Photo voltaic (PV) is another example on active use of solar energy in buildings, where solar energy is transformed into electricity and used for the buildings supply of electricity. Solar energy can also be transformed directly into cooling and used as a cooling source. These systems will often require little storage, because they produce when needs for cooling are high.

Other renewable energy sources in building can be small building integrated windmills or systems that use biomass or waste products from the buildings and heat pumps can be used

29 By multiple zones the building is shared in parts, which are treated individually in the calculations. 1692 of 2287
25 to increase the use of renewable energy supplies for instance in the ground, in air or in water.

5.4 Installed equipment
Installed systems other than HVAC systems can influence a building’s energy performance in two different ways: through their own energy demand and through their production of waste heat which can result in increased cooling loads or decreased heating loads. Given their connection with buildings, some appliances fall under the auspice of building energy efficiency requirements in building codes and appear in the calculation of energy efficiency performance of buildings30.

Some equipment and electrical appliances have more loose connection to the building and can more or less simply be removed or exchanged without interfering actively with the building itself. Other IEA studies examine the efficiency of these appliances.

Lighting
Lighting requirements respond to a building’s design. The need for lighting, especially during daytime, will depend on the size and placement of a building’s windows, and the building’s situation. The need for lighting can be reduced by the use of automatic controls which depends on the orientation of buildings windows, the supply of daylight, use of the room etc.

Indoor lighting systems produce heat, in form of waste energy depending on the actual type of installations, that can reduce energy demand for indoor heating in cold climates or during winter and raise demand for indoor cooling in hot climates or by summer. Building regulations can govern lighting systems general or more commonly only the built-in lighting systems. Assessment of highly energy efficient buildings should also consider lighting. 31 Appliances
Many electrical appliances such as white goods device or televisions and computers will have an interaction with the building in which they are installed, since they will contribute to waste energy for the building. This will influence the need for heating and cooling. In particular in cooled building waste energy from inefficient appliances can lead to double energy loss, first because they use more energy themselves and second because they create waste energy, which has to be cooled away by the cooling or ventilation system.

In highly efficient buildings, heat from installed appliances can substantially influence the need for heating and cooling. Around the world, programmes such as FEMP and Energy Star in North America, EU appliance labelling schemes and Japan’s Top Runner promote energy efficient appliances32.

Efficient appliances are treated in a special study as a part of the Gleneagles Plan of Action and in IEA publications such as Saving Electricity in a Hurry and Cool Appliances.33

5.5 Zoning of buildings
Zoning of a building means that the building is divided up into separate areas, each with the potential for uniquely-calculated requirements for energy efficiency and indoor climate.

30 As specified in the European Directive on Energy Performance in Buildings, lighting for non-residential buildings and the heat gains from other appliances must be calculated in general energy performance. 31 Lighting is treated in depth in the IEA study: Light Labour’s Lost: Policies for Energy Efficient Lighting. 2006 32 Top Runner is a Japanese system where producers are encouraged to develop and implement energy efficient systems. Further description of Top Runner later in this paper under building codes in Japan. 33 Cool Appliances, Policy Strategies for Energy Efficient Homes, 2003. An update of this publication is under preparation.
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26 There might be transfers of energy from one zone to another, if there are differences in the indoor temperatures. Zoning can be needed for passive solar conditions, for building ultra low energy consumption and for complex buildings that have multiple functions, to ensure that suitable indoor climatic conditions are obtained in different parts of the building.

5.6 Integrated design
Integrated design is a term used for a process where all the elements described above are used to reduce the energy consumption in a building.34 In this process actions are taken to reduce the energy consumption as well through insulation or efficiency as through the design of the buildings and the HVAC systems. Passive use of renewable energy and other natural sources is an integrated part of the design and development process and there is an interactive process between the design of building and systems.

Integrated design requires more emphasis on energy efficiency and systems in the early planning phase than traditional design and it is difficult to regulate through building codes and energy efficiency standards, but the most advanced standards or energy performance calculation includes options for integrated design. Some examples where the integrated design process is used are described later.35

5.7 Conclusion
Many elements influence the energy performance of a building; building codes often address the most integrated of these elements: the building envelope and HVAC systems.

Other appliances and Renewable Energy are more rarely included.

Many building energy efficiency regulations started with requirements for the building shell, and nearly all efficiency regulations for new buildings include requirements for the building envelope. As the building’s envelope improves, regulations focus on the energy efficiency of HVAC systems. Finally, when all parts of building and HVAC systems are covered, regulations address other installations and renewable energy.

For some regulations, energy efficiency requirements are primarily set for buildings and the building shell. While some building codes include the energy consumption of installed equipment and appliances, some include lighting and others do not. The treatment of renewable energy systems in building codes also varies.

The most advanced building codes or standards for energy efficiency in buildings today include all of these aspects. It should be the aim to include most of these elements in building codes or the calculation of energy performance, especially when requirements are high, since this will increase the saving potentials and will prevent sub-optimisation of the demands for some parts of a building.
6 Types of regulation
Energy efficiency requirements can be set in different ways and the basic types are:
 Prescriptive. This method sets separate energy efficiency requirements for each building part and for each part of the equipment. Individual components must achieve compliance with their specific targets.

34 In the integrated design other use of resources will also be evaluated and the process will also include the consideration of costs by different options.
35 Examples where an integrated process is used can be Passive Houses, Zero Energy or Carbon Buildings and Green Buildings.
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27  Trade-off. Values are set for each part of the building, but a trade-off can be made so some values are better and some are worse than the requirements.  Model building. Values are set as in the trade-off, and a model building with the same shape is calculated with those values. A calculation has to demonstrate that the actual building will be as good as the model building.
 Energy frame. An overall framework establishes the standard for a building’s maximum energy loss. A calculation of the building has to show that this maximum is respected.  Performance. Energy performance requirements are based on a building’s overall consumption of energy or fossil fuel or the building’s implied emissions of greenhouse gas.

6.1 Prescriptive
When using the prescriptive method, energy efficiency requirements are set for each component of the building. This could be a thermal value (U-value) for windows, roofs or walls. The prescriptive method can include efficiency values for technical installation, ventilation, orientation of buildings, solar gains, the number and size of windows. To comply with a prescriptive standard, each part of a building must meet its specific value.

A simple version of a prescriptive building code set thermal values for the essential 5–10 building parts. In the most complicated systems, energy efficiency requirements are set for all parts of building and installations, including heating installation, cooling units, pumps, fans, and lighting. In some cases, these requirements are even adjusted according to size of the equipment or the size of or percentage of windows based on floor area or the outer wall.

In general, instructions for the prescriptive method are easy to implement. U-values can be followed by descriptions of typical constructions which fulfil the requirements and requirements for equipment can be combined with the labelling of products. A prescriptive method could require an appliance to be labelled A or B, or rated with energy stars.

6.2 Trade-off
The trade-off method sets values for individual building parts and / or for parts of the installations, akin to the prescriptive method. However, in meeting a general standard for efficiency, a trade-off can be made between the efficiency of some parts and installations such that some values are exceeded while others are not met.

The trade-off is generally made in simple terms. Trade-off can be made between U-values for the building shell36 or between building shell and the energy efficiency requirements for heating and cooling installations. The trade-off model provides more freedom and flexibility than the prescriptive method. The calculations are normally simple and possible to do by hand or in a simple spreadsheet.37

6.3 Model Building
In the model building method, values are set for each building part and / or for the parts of the technical installations. Based on the values and the characteristics of the actual building a model building is calculated with all the set values for losses and efficiency. This calculation follows a clearly defined method. The actual building is then calculated by the same method using the actual values for the individual building parts, heating, cooling, and

36 For instance U-values are balanced according to the area, so 10 m² with + 0.2 in one value can be exchanged to 20 m² with – 0.1 in another value.
37 By trade off models a special attention should be taken for systems with a long lifetime such as insulation and building structures and systems with short or medium lifetime, such as most HVAC systems. 1695 of 2287
28 ventilation systems. The total result of the calculation is compared with the model building and the actual building must perform as well as or better than the model building.

The most complicated models include all parts of the technical systems in these calculations, including all parts of heating systems, ventilation, cooling, lighting, built in equipment etc. Renewable energy can be included in the calculations, to make a solar collector, for instance, reduce the general efficiency requirements for the heating system or even the insulation level.

The model building gives more freedom and flexibility for building designers and constructors than a prescriptive model. Expensive systems can be changed with improved efficiency in parts of the building or installations where efficiency will be more cost effective.

6.4 Energy Frame
The Energy Frame for a building sets a maximum of energy loss from the building. This is usually set as a total frame for the building, a value pr. m² building area or as a combination. The energy frame will then be followed by a procedure on how to calculate the energy losses from simple values such as the u-values, temperature, surface and heat gains from sunlight etc. Values for the individual parts are not set in this model but only for total loss or use of energy.

This method enables the constructor to build parts of the buildings that are less energy efficient when other parts are made better than typical constructions. This method can as example also avoid limiting the size window area, as improved windows or increased insulation can adjust for the additional heat losses or larger sun gains by having a larger surface of windows. As long as the overall value is met, the building is approved.

The energy frame can also be defined as an overall thermal value (adjusted u-value), pr. square meter of building floor area or similar. Again it will be the constructor’s decision to document that the building is built up to the standard of the model building given by the overall values.

Similar to the model building this gives more flexibility in the fulfilment of the requirements and this can easily be adapted to the most economic solution. On the other hand it increases the need for calculation.

6.5 Energy Performance
With the energy performance method, a total requirement for the building is set based on the supply of energy or the resulting environmental impact, for instance in form of CO2 emissions. This method requires a comprehensive method for calculating the energy performance of a building, with standard values for climate and use of the different types of buildings. Constructors are required to use an advanced computer based model for the calculations, which integrate all the different parts and installations of the building.

Values for energy performance are set on the basis of an overall value, consumption pr. m² or a mixture, for different types of use or different types of buildings etc. Installations as renewable energy in the building will usually be calculated as improvement in performance, meaning that a solar collector or solar cells can substitute insulation, efficiency in boilers or air conditioners. The performance model requires handling multiple factors as solar gains, recovery of energy losses, shading and efficiency in installations.

In the energy performance, comparing the use of different energy forms such as heating (gas, oil or district) with the use of electricity is necessary. Depending on local energy conditions, there may be adjustments, where some kWh’s or Gj are valued higher than other or the comparison can be based on energy costs.
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29 In performance calculations, the maximum value is often set for the use of fossil fuels, primary energy use or as a maximum CO2 emission. Free trade-offs can be made between insulation and installation of efficient equipment, but also based on the selection of fuels, the use of renewable energy, the primary design (form) of the building, use of daylight, and intelligent installations or automatics. Windows with better thermal values can be used to increase the window area or negative losses can be out balanced with positive gains as passive heating.

Energy performance standards give optimal freedom for constructors or designers to reduce energy consumption within the frame. If efficient boilers or air conditioners are more cost effective than improved insulation, the constructors can choose this alternative to improve performance. Similarly, it will be possible to substitute more expensive solutions in the building envelope with efficient renewable energy systems or heat recovery. The model adapts to a change in prices, technical development and allows new solutions and products.

There is a need to develop and maintain sophisticated calculation methods and computer tools that take all these important factors into account.

6.6 Mixed models, hybrids
Some countries use a mix of the above models. For example, an energy frame for the building might be combined with prescriptive values for installed products. Another typical mixture is when building codes allow a choice between the simple approach with prescriptive values, an energy performance or an energy frame. The designers can therefore use a model which is simple to calculate, or choose a more complicated model, which offers more freedom and flexibility. Sometimes both performance values and prescriptive values are set, where the prescriptive values are tighter than the value for the overall calculation, which ensures that buildings constructed after the prescriptive values, automatically fulfil the energy frame or energy performance requirements.

Some countries or states have two or more models which have to be fulfilled at the same time; in this case, energy efficiency requirements will grow from the prescriptive models over the energy frame to energy performance. The target is to ensure that no building part or component of the heating or cooling system is too poor, but rather to base the overall calculation on a model that gives more flexibility. The aim may also be to avoid moisture problems if building parts without insulation result in condensation, or to compensate for different lifetimes of components.

6.7 Development
Most countries have started with prescriptive values. When energy efficiency requirements increased and more elements included, trade-offs or an overall frame allowing adjustments of the individual values was required. Today, energy performance models and computer tools are being developed in many regions. International standardisation has been introduced with the aim of developing and harmonising models to calculate energy performance.38
At the same time, countries have decided to have several methods for compliance with norms which allow builders and constructors to choose. This is especially the case for small residential buildings where there is a general effort to make simple and comprehensive rules.

6.8 How to compare
In order to compare building codes, the different types can be simplified into two basic forms. Building codes which are set based on energy efficiency requirements for individual

38 Standards have been developed under CEN and are now under adoption and development in the ISO. 1697 of 2287
30 building parts - “U-value based building codes” - and the codes for which these requirements set the overall frames in order to calculate energy consumption - “Performance based building codes”.

U-value based building codes
The Prescriptive Method, the Trade-off Method and the Model Building Method are all based on standard maximum values for transmission (U-values)39, coefficients, energy efficiency values and similar values which can easily be compared. Whether trade-offs are possible will accordingly influence the level of the values.

Calculation or performance based building codes
The Model Building, Energy Frame and Energy Performance methods are all based on calculated energy consumption and all require calculation models and computer tools.

The calculation procedures are normally set national, regional or local. However, CEN40 / ISO41 are developing international standards which will ease future comparisons. These types of regulations have to be compared based on total performance or the total frame, but again climate conditions must be taken into account.

6.9 Conclusion
Energy efficiency requirements can be set in different ways, prescriptive, trade off, model building, energy frame or energy performance. Requirements are basically set either on a building part or component level or as an over all maximum for a calculated value.

The different methods have different advantages and disadvantages. U-value and efficiency based codes, in particular for the prescriptive model, is generally the easiest to understand for constructors, since the values are given on a disaggregated level. Standard constructions and installations can be given which fulfil the energy efficiency requirements, and buildings can be constructed without calculations or the use of computer models.

The prescriptive method develops standard solutions that can help to reduce costs on sight, but may lead to over optimisation of particular parts of the buildings or installations, which can lead to increased costs for energy efficiency. However, the trade-off allows some flexibility and freedom in selecting methods and solutions or in optimising energy efficiency without requiring too many calculations. With the energy frame, and finally with energy performance, these possibilities for flexibility and optimisation of costs for efficient solutions will increase. Using the performance model requires computer-based models and a deeper understanding of some of the principles.

It is not easy to determine which type of code is best as it often depends on the actual experience in the country and the development of the construction industry. Often several types of energy efficiency requirements exist side by side as alternatives.

Comparison of building codes are difficult between the different types of codes and can only be justified for codes based either on individual values or performance and frame based values.

39 Or minimum values for resistance (R-values).
40 CEN European Organisation for Standardisation, which have developed standards for the implementation of the European Energy Performance in Buildings directive. Homepage www.cen.eu. 41 ISO is the International Organization for Standardization, which is currently working on the development of further international standards for energy performance calculations for buildings, Homepage www.iso.org. 1698 of 2287
31 7 Conditions for Building Codes, Comparison
Local conditions greatly influence the energy performance of buildings. When comparing building codes, the most significant considerations are climatic conditions, including local temperature, humidity and ambient natural light.42
Heating
In cold climates or in the heating season heating is the most important energy issue, and there is a direct link in the difference in temperatures and the loss of energy from buildings.

Energy losses through a wall, floor, ceiling, and window or by ventilation are directly proportional to the difference in indoor and outdoor temperature. Similarly will the savings obtained by insulation or improved efficiency.

A simple value to define the need for heating in cold climates is Heating Degree Days43 (HDD). Heating will be reduced through the positive use of energy from the sun that comes into the building through windows, from body heat, or waste energy in appliances. This is adjusted by using the heating degree days based on a temperature lower than 20 °C, for example 18°C or 17°C44.

Cooling
In hot climates cooling is the most important energy use in buildings and outdoor temperatures will have a large impact on cooling needs. Cooling needs also depends on the hours of sunlight, the intensity and how much the sunlight penetrates the building. A simple value to show the need for cooling is Cooling Degree Days.45 Solar radiation based on the penetration of sunlight in the building will increase the need for cooling. Heat gains from people and appliances in buildings increase the need for cooling too. This is addressed by using a colder temperature than the designated indoor temperature for the calculation of Cooling Degree Days.46
Higher cooling needs will lead to higher consumption in the same building, and at the same time larger saving can be obtained from a particular measure such as insulation, better glazing or improved efficiency in the air-conditioning or ventilation systems.

Humidity
Humidity is another climatic condition that influences buildings’ energy consumption. In areas with a high rate of humidity, especially when both hot and humid, air-conditioning must reduce indoor humidity both for comfort and to prevent moisture damage in buildings and installed equipment.

There are other parts of energy consumption that are influenced by climatic conditions, such as lighting, which depends on the hours of light and the intensity of the sunlight etc.

Less daylight in polar areas during winter will require more energy for lighting. For a

42 For further explanation, see the IEA Working paper Comparing Building Codes and Selecting Best Practices (September 2006.)
43 One Heating Degree Day is a day during which the average difference between inside and outside temperature is one degree Celsius. A day during which the indoor temperature is 5 degrees higher than the average outdoor temperature is counted as 5 Heating Degree Days. Heating Degree Days are commonly used in OECD countries.
44 Heating Degree Days are named by the indoor temperature used as the baseline for calculation: for instance, HDD20 if the baseline temperature is 20 °C or HDD18 for 18 °C. HDD 18 or HDD 17 are most commonly used. 45 Cooling Degree Days, CDD, are calculated like Heating Degree Days, though using only days where outdoor temperature exceeds a certain temperature. The CDD metric is not as commonly used as HDD figures; CDD data are available for all countries.
46 Some countries use a temperature much below 20 °C to adjust for solar radiation and other heat gains. For example, the ASHRAE codes use as low a temperature as (10 °C) for the calculation of CDD. 1699 of 2287
32 general comparison of codes and standards and a selection of best practices, heating and cooling and to some extend humidity are important parameters to be considered.

Different influences of appliances
Heat losses from inefficient lighting systems and installed appliances will have a different impact on energy performance in cold and hot climates. In cold climates, waste energy from heating appliances or light installations can, to some extent, be used to substitute heating – at least during the cold part of the year – while in hot climates this waste energy leads to increased cooling. Savings in efficient appliances and lighting in hot climates will therefore count twice in the energy performance, while they count less in cold climates. In hot climates, it is hence even more important to be careful with the wasted energy from such systems.

7.1 Climatic classifications
There is a clear need to take climatic conditions into consideration when Building Codes or other measures for buildings are evaluated, compared or when Best Practices are selected.

Buildings act different in cold and hot climates. It is therefore not possible directly to compare the heating requirements, for instance in north European countries with the cooling requirements in Australia or in Southern India47.

Some countries with more climate zones use a system of classification for different areas and set different energy efficiency requirements for insulation and energy efficiency based on the climatic conditions in these areas. This is, for example, the case for the USA and China where a climatic correction is built into the energy efficiency codes based on degreedays.

Köppen Climate Classification
Climate classifications are often based on the Köppen Climate Classification system, which proposes six general climate types: A) tropical, B) dry, C) mild latitude, D) serves latitude, E) polar and H) for highland. Each of these classes is divided into sub categories according to the type of winter or summer. The 6 basic climates is subdivided at least 23 different sub-climates. The Köppen climate classification has been the basis for different systems of building energy efficiency regulations setting up different requirements for different climatic zones.

The 6 basic climates in the Köppen Classification are not sufficiently homogeneous to evaluate and compare building codes since some climates include a large variety of conditions in which buildings will perform differently in term of heating and cooling. The sub-climates are more homogeneous, but it seems on the other hand too complicated to work with 23 different classes when comparing energy efficiency in buildings.

The standard building codes
The ASHRAE standard for commercial and large complex buildings uses 8 zones and 17 sub zones (A, B, C) alone for the US. They follow calculations of Heating Degree-Days, Cooling Degree-Days and moisture (Marine, Dry, and Moist zones) and are adopted according to state borders48.

The latest version of the International Energy Conservation Code, IECC – a model code for low rise residential and simple commercial buildings - has been simplified, and in this code the US is shared in 10-12 zones (8 general zones 1-8 and some sub zones A, B and C for

47 Climatic classifications and the need for simplification are discussed in further details in the IEA Working Paper on Comparing Building Codes and Selecting Best Practices. 48 These climatic zones for US were developed by DOE’s Building Energy Code Program specifically for use in the US codes and standards. Both ASHRAE and IECC use heating degree-days 65°F (18°C) and cooling degreedays 50°F (10°C). 1700 of 2287
33 some of the general zones). The zones in IECC are based on the number of Heating degreedays and cooling degree-days. The major part of the zones is based either on heating or degree-days, but 2 zones are based on both heating and cooling degree-days49.

7.2 Simplifications of climatic conditions
The systems mentioned above seem too complicated for a general evaluation and comparison of building codes. For a valuation and comparison of building codes around the world, it is preferable to work with more simplified conditions. In this model the different climatic conditions are split 6 different basic climatic zones based on heating and cooling requirements. There might be a need to add one further zone based on extreme humidity, which results in a need to reduce humidity50. In general, the climates could be described as follows:
 Cold climate – a climate where winter is cold and summer temperatures never or only rarely reach a level above comfort level (22 - 25 °C). In this climate, there will hardly ever be a need for cooling. This is the case for large parts of Russia, Scandinavia and Canada.  Heating based climate – where the need for heating in winter is large, but where summer temperatures can reach a level where cooling becomes an option at least for comfort reasons. This is the case for Central and North of Europe, most of Canada and central US.
 Combined climate – where winter is cold and summer is hot. Heating is necessary in winter as well as cooling in summer. This applies to Moscow and central parts of Russia, Shanghai region and other parts of in China.
 Moderate climate – where both summer and winter are mild and the need for heating and cooling is quite limited. Portugal and central parts of California, as examples.  Cooling based climate – where summer is hot with a need for cooling in the summer but where there can be a need for heating in the winter. Greece, Italy, southern California, Australia.
 Hot climate – a climate where summer is hot and winter warm where winter temperatures never get below comfort level (16 - 18 °C). Florida, northern Australia, Central Africa.

Table 1. Simplified climate zones, heating and cooling degree days Heating Cooling
Cold Climate 2000 ≤ HDD 18 °C CDD 18 °C < 500
Heating based 2000 ≤ HDD 18 °C 500 ≤ CDD 18 °C < 1000
Combined Climate 2000 ≤ HDD 18 °C 1000 ≤ CDD 18 °C
Moderate Climate HDD 18 °C < 2000 CDD 18 °C < 1000
Cooling Based 1000 ≤ HDD 18 °C < 2000 1000 ≤ CDD 18 °C
Hot climate HDD 18 °C < 1000 1000 ≤ CDD 18 °C
Proposal for simplified climatic zones based on heating degree days and cooling degree days.

49 Both ASHRAE and IECC standards will be further describe in paragraph on building codes in North America. 50 A further discussion and description on these zones can be found in the working paper on Comparing Building Codes and Selecting Best Practices from September 2006. 1701 of 2287
34 The allocation of climate into these 6 basic zones could be based on Heating Degree Days and Cooling Degree Days as proposed in Table 1.

7.3 Valuation of building codes
For a comparison of thermal regulations for new buildings and installations this can be further simplified into 3 different main areas:

Cold climate and heating based climates
In both Cold Climates and Heating Based Climates, the comparison can be based mainly on heating needs and efficiency in heating and ventilation installations. In both types of climates, heat gains from the sun and internal sources will reduce the need for heating and benefit energy efficiency, although concerns should be taken primarily in heating based climate to avoid over heating in the summer. Windows and other openings should be constructed mainly to benefit from the sun’s free energy. Efficiency of heating systems should also be addressed. In a simplified comparison, regulation can be compared based on heating degree days.

Hot climates, cooling based climates
In Hot Climates and Cooling Based Climates the comparison can be based mainly on cooling needs and on efficiency of cooling installations. In both types of climates, energy from the sun the internal heat gains will increase the need for cooling. Solar radiation in the building and the internal loads should be reduced and controlled as much as possible as this will have energy savings in appliances and installation as well as in cooling. Windows and other openings should be protected for heat gain from the sun through shading etc. Efficiency of cooling systems should be addressed too. In a simplified comparison, regulation can be compared based on cooling degree days.

Mixed climates
In a Combined Climate or a Moderate Climate it is impossible to make a simplified comparison based only on heating degree days and cooling degree days as it is necessary to balance heat gains from the sun and internal resources with cooling and heating demands over the year. The best solutions will be highly dependent on actual local conditions.

Shading, clever and integrated solutions are essential in these regions to allow solar penetration in winter and reduce heat gains in summer are needed in order to balance heat and cooling needs.

Shading, orientation of windows and openings are of major importance for the total energy balance of the buildings. Comparison of building codes and valuation or selection of best practices is rather complicated.
8 Least Lifetime Costs
Since climatic conditions have such a large impact on the building codes and there are different ways to set buildings codes, it is difficult to compare these energy regulations for new buildings in different countries or regions. At the same time it can be interesting to compare the code with general optimum for the energy efficiency level for the requirements.

One possible comparison of building codes is to look at the least total costs seen over time (LCA). In this comparison the costs for the investments will be compared with the economic benefits for the owner or user of the building in terms of savings.

For buildings, most savings have a long life time and for some savings it might even be the whole lifetime of the building. For buildings in general, it is reasonable to look at a 30-year timeframe as this is a typical interval before a new building requires the first major renovation and which also fits with maximal mortgage or loan periods in many countries. 1702 of 2287
35 8.1 Methodology
Energy efficiency improvement often have an initial cost – seen as an investment – which is carried by the owner or constructor of the buildings. This increases the total investment and this will lead to a need for larger loans for the construction of the building. In new buildings investments costs can either be additional costs if building parts are improved or technical equipment replaced with more efficient equipment or it can be full costs for new systems.

Many decisions are taken mostly based on the initial costs. Instead of looking only at incremental costs, the total costs should be addressed including the energy use. For new buildings should be valued over 30 years seems rational. Interest rates should be estimated and the annual payment for the improvement should be calculated. In some cases, this timeframe is longer than a first occupier or owner might stay in or use a building, but in the event the property is sold the improved efficiency should lead to a higher resale price, which will enable the first owner to recover the investment.

At the same time investment in energy efficiency will lead to reduced energy consumption in the building and maybe changed costs for maintenance. Based on estimated savings, energy prices and prognoses for development over the next 30 years, the savings for the first year and in the following 30 years can be calculate.

If savings over 30 years are larger than investment costs and costs for financing the improvement is said to be feasible, since it reduces the total cost for the use of in the building over 30 years. This should in general reduce costs for owners and users of these buildings.

Costs for investments, maintenance and savings can either be calculated summarised over 30 years or it can be calculated as a yearly average value for the costs and savings per year.

8.2 Energy efficiency optimum
Energy savings depend on climatic conditions. In cold and heating based climates this will mainly depend on heating needs given by the Heating Degree Days, in hot and cooling based climate this will mainly depend on cooling needs given by Cooling Degree Days.

Figure 6. Saving potentials and investments depending on the heating degree-days
Example of a simple insulation of a ceiling construction shows that the saving potential for improvement of the building envelope is proportional with the increase in heating degree-days, but the savings for additional insulation will also decrease with increased insulation. First part shows the costs while part two shows the simple payback time for additional insulation.
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36 For different climatic conditions, the optimum for part of the building or heating, cooling and ventilation system can be assessed for the optimal size of insulation or energy efficiency that would be the cheapest over a longer term (30 years).

Increased insulation will have the same costs independent of the climatic conditions. The savings will on the other hand depend highly on the climate and the amount of heating degree days, but will also be different for the first part and for the following insulation. A simple example on costs and saving is illustrated in figure 6.

Since savings from insulation is highly dependent of the climatic conditions, while costs for additional insulation is nearly independent of the climate, this will give a different feasibility of insulation in different climates similar will the optimal level of insulation is seen over lifetime51. A simple calculation for two different parts of in Europe is illustrated in figure 7.

Figure 7. Lifetime Costs for insulation in North of Europe and for Central Europe.

Life Cost Analysis for simple roof insulation in a climate with 4500 HDD 17°C 52 and for a climate with 2200 HDD 17 °C.53 Cooling need is expected to be very low in these regions and savings on cooling are not included in the calculation.

Based on this example a least cost curve for insulation thickness depending on Heating Degree Day can be drawn for Europe. As shown in this graph, quite substantial levels of insulation in North Europe show the lowest costs over 30 years.

Such curves can be drawn for different parts of the building and for the heating, cooling and ventilation systems. However, the different types of insulation (glazing, heating, cooling or ventilation systems) will to some extent interfere and improved insulation might reduce the improvement benefits of a boiler and vice-versa. Reductions in total costs can also occur as energy savings will be greatly reduced that a smaller or no heating system will be required.

In a curve for insulation or efficiency there may also be points where additional costs appear because of increased thickness of constructions or changed solutions. Similar might the curves be influenced by local price levels and traditions54.

51 The lifetime costs are calculated over 30 years and the savings in energy costs and maintenance costs are compared with the incremental investment. Interest rates are taken into account and so are expectations for future energy costs and so is inflation in general and for maintenance in particular. 52 4500 HDD 17 °C is climatic conditions similar to Scandinavia or central Canada. 53 2200 HDD 17°C is climatic conditions similar to Central Europe or Seattle or similar northern regions in US. 54 An example on a curve based on local traditions is given in the following chapter on building codes in the European Union.
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37 Figure 8. Curves for the optimum of life costs for simple insulation Least Cost Optimum for simple roof insulation based on additional layers of 50 mm each and a continuous best line. Curve estimates depending on the Heating Degree Days. This curve doesn’t include savings from reduces heating or cooling systems55.

An overall solution to this problem would be to estimate the least cost optimum for the overall energy performance of the building, although this is complicated.

8.3 Indicators for efficiency in new buildings
Based on the least cost curve above, an indicator can be developed. This indicator can show how far the demands in building code are from the least costs optimum for different parts of the building and the installations. A theoretical graph with this indicator is shown in Figure 9.

Figure 9. Graph on the indicator according to HDD
U-values for roof insulation compared to life cost optimum.

55 Reduced need for heating and cooling can reduce total costs (principle of Passive Houses); this will reduce the optimum u-values even further, see paragraphs on passive houses. 1705 of 2287
38 Based on this least cost curve and indicator will also show how much of the optimum is achieved in individual countries. The optimum achievement could be set to 100 %. A value above 100 % would then show that the u-value is over the optimum. Values below 100 would indicate that the level for the building code is stricter than the optimum.

There could be good reasons to go beyond the least cost optimum for instance by setting a value for reduced CO2 (in certificates or by subsidy), or because these requirements could be used to reduce the costs for energy efficient solutions in general or could be a part of a national policy to obtain greenhouse gas emissions. Similar will improved U-values be able to reduce the need for heating or cooling installations and this might reduce the total costs of the building56
.
9 General status in regions

9.1 Europe
In the European Union, the regulation for energy efficiency in buildings is based on directives, which have to be implemented in all the member states. The most important directive for energy efficiency in buildings is that on Energy Performance in Buildings.57 Energy Performance in Buildings Directive
According to this directive, all member states have to set standards for energy efficiency in new buildings based on the energy performance of the building. The performance has to take into account the building shell including air-tightness, heating and cooling installations, ventilation, the orientation and position of the building, passive solar systems and solar protection and the indoor climate according to the annex to the directive. For non residential buildings built-in lighting systems has also to be included. The positive influence of Active solar systems and other renewable energy systems, CHP58, district heating or cooling and natural light also have to be taken into account.

Table 2. Annex with calculation elements required in the EPBD The requirements for the calculation are set in the annex of the directive. It is left up to the subsidiarity of the member states to set and develop models for energy performance.

It is up to member states to decide the level of energy efficiency requirements, but these levels have to be revised at least every 5 years and updated, based on technological development. In general, it is left up to the member states to set up the calculation

56 See under passive houses later in this paper.
57 Directive 2002/91/EC of the European Parliament and of the Council of 16 December 2002 on Energy Performance in Buildings
58 Electricity produced by combined heat and power.

Annex 1

1. The methodology of calculation of energy performances of buildings shall include at least the following aspects:
(a) Thermal characteristics of the building (shell and internal partitions, etc.). These characteristics may also include air-tightness;
(b) Heating installation and hot water supply, including their insulation characteristics; (c) Air-conditioning installation;
(d) Ventilation;
(e) Built-in lighting installation (mainly the non-residential sector); (f) Position and orientation of buildings, including outdoor climate; (g) Passive solar systems and solar protection;
(h) Natural ventilation;
(i) Indoor climatic conditions, including the designed indoor climate. 1706 of 2287
39 method based on these conditions, but the European Commission has initiated an initiative where the European Standardisation Organisation59 develops standards to calculate the different parts of the energy performance. 31 standards are under preparation for the calculation of heat loses, heat gains, efficiency in heating, ventilation, air-condition systems, lighting and automatics, etc.60

The European Directive on Energy Performance sets standards for major refurbishments or renovations of large buildings with more than 1000 m².61

The directive on energy performance further claims that buildings must have a certificate when constructed, sold, rented out. Large public buildings must be certified regularly. All new buildings have, therefore, to be certified. There have been discussions between member states during the implementation as to whether the best time for this certification is during design or after construction. During design certification can influence decisions and ensure that energy efficiency concerns are taken into consideration at an early design stage. Certification after construction can control the actual state of the building and guarantee that the energy efficiency requirements have been fulfilled. A few countries go for both types of certification62
.

Finally the directive on energy performance in buildings sets demands for inspection of heating and cooling systems.

A special homepage “Buildings Platform”
63 is supported by the European Commission giving
information on the progress of implementation in member states and the directive in general.

Other directives
There are other directives that have a large impact on energy performance or energy efficiency of buildings. This includes the Eco-Design Directive 64 indicates the top set demands or demands for labelling of different appliances and products and the directive on Energy end-use and Energy Services65 setting targets and demands for energy services and energy efficiency activities, and different labelling or energy minimum standard directives etc.

The Eco-design directive is aimed at the energy efficiency of products and appliances including many products installed in buildings such as household electrical appliances. This directive will, therefore, have an impact on the energy performance of buildings.

The Eco-design directive is a framework directive, defining the principles, conditions and criteria for setting environmental requirements for energy-using appliances (Eco-design). It therefore makes no direct provision for mandatory requirements for specific products; this will have to be done at a later stage for given products. The framework directive applies to all energy-using products that are placed on the market. It also covers parts that are intended to be incorporated into products, if the environmental performance can be

59 CEN, European Committee for Standardization.
60 An overview of the standards can be found on the homepage www.builidngsplatform.org 61 Larger renovations are defined as renovation, which costs more than 25 % of the buildings value or which concern more than 25 % of the building shell.
62 Information from the project Concerted Action EBPD can be found on www.buildingsplatform.org. 63 The buildings platform, http://www.buildingsplatform.org, is a project supported by the European commission to inform on the energy performance directive and the implementation in the European Countries. 64 Directive 2005/32/EC of the European Parliament and the Council on the eco-design of Energy-using Product. 65 Directive 2006/32/EC of the European Parliament and the Council on energy end-use efficiency and energy services.
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40 assessed independently. All energy sources are covered, in particular electricity and solid, liquid and gaseous fuels.

General status
The European Union has set up a directive outlining basic requirements for energy efficiency standards for new buildings and by refurbishment, but many details are left up to the individual member state. In particular, the individual member state has to define the level of the minimum requirements for new buildings.

The European Commission has set up different facilities to work for harmonisations of the rules in the countries and among these are: The Concerted Actions EPBD66, which is a cooperation project aimed at converging regulations in the countries. The Buildings Platform 67 , which aims to share information on the implementation. Different frame programmes support projects providing input to develop rules in individual countries. These activities will include a project to develop a common building code standard for Europe based on different climates.

Most countries in the European Union have updated their energy efficiency requirements for buildings within the last 2 years or are in the process of setting up new requirements based on energy performance of buildings. The levels for these standards vary substantially.

Sweden
Sweden has very long tradition of energy efficiency requirements for new buildings. Already in the late 1970s stringent requirements was introduced in Sweden. Although they have only been slightly changed over time they are still today among the highest energy efficiency requirements in the world.

Table 3. Main values for the building envelope for new buildings in Sweden.

Building Code in Sweden U-value W/K per m2
South North
External Walls 0.13-0.14 0.12-0,13
Ceilings / roofs 0.15 0.13
Grown deck 0.16 0.13
Floors with heating 0.12 0.10
Floor over open air 0.10 0.08
The Swedish building regulation requires that individual values depend on the type of construction, and where the building is situated. All of the values for efficiency are high and comparable with the values for passive houses in central Europe.

Rules are set for ventilation and other thermal comfort and for efficiency in installed products, such as boilers and air conditioners. At the same time, values are set for the overall energy performance and consumption for the building. Values depend on whether the building is in the north or south of Sweden with different values for commercial and residential buildings.

66 Concerted Actions EPBD was a project formed in 2005 and ending in June 2007, but expected to continue in 2007 – 2010 with 29 states as members. Concerted Action conducts workshops and information share among the member states. Homepage www.EPBD.org.
67 An information activity supported by the European Commission to inform on the implementation of the EPBD directive in general and in the individual member states on the homepage http://www.buildingsplatform.org/cms/
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41 Table 4. Maximum overall performance values for new buildings in Sweden.

Building Code in Sweden Overall performance values kW / m2 per year
South North
Residential buildings 110 130
Commercial buildings 100 120
Electrically heated Buildings 75 95
Energy performance values are set as maximum per m² floor area per year for the different types of buildings.

As well the values for maximal energy performance and the requirements for insulation of the building envelope are close to those for the Passive House standard68. The compliance with these values has to be documented with the actual consumption after construction.

Comparison U-values
If the values set by the member states of the European Union are compared with the least cost optimum over 30 years for the different types of energy efficiency requirements in the building regulation, then these requirements are shown to be quite far from this optimum.69
Figure 10. Comparison of energy efficiency requirements in the building codes and LCA

Wall and ceiling insulation is compared here with the Least Costs optimum (LCA).70 The values for LCA values are estimated based on the actual climatic conditions in major cities in all the countries and with actual costs in this region.71

68 Passive house standard sets vales for buildings with ultra low energy consumption and they are treated more deeply in a separate chapter later in this document.
69 The costs for energy efficiency improvements in many cases are highly depend on weather there are only additional costs or if the whole costs have to be covered by the improvement. By construction of new buildings there will typically only be additional costs for efficiency requirements in building codes, since improvements can be planed before the actual products are purchased or installed. 70 Values are calculated as annual costs based on a formula: A + (1+j)n * i / (1+n)n –i, where a = annuity factor, I
= interest rate, n = lifetime. Lifetime for insulation is set to maximum 30 years even if savings by some types of insulation might last longer, because a new refurbishment of change of use might occur over time. 71 The values for the LCA are based on the EURIMA and Ecofys study on building codes: U-values for better Energy Performance of Buildings.
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42 There is a big difference in how close the values in the building codes are to the least cost optimum. Only a few countries have values, which are close to these values. Additional savings from reduction of heating and cooling installations not are included in the calculation. If these savings were taken into account the result would show lower values for the optimum and a larger distance between actual values and the LCA optimum72 .

The graphs also show that some countries have regions where some larger cities might be close to the line while other cities in the country are far from the LCA optimum. This would infer different energy efficiency requirements for different regions73.

9.2 North America
Setting standards for energy efficiency in buildings in the US and Canada is the responsibility of individual states, but there is substantial difference between the systems in the two countries.

In the US state codes are generally based on model codes which are developed by private organisations in collaboration with US Department of Energy (DOE); International Energy Conservation Code (IECC) 74 by the International Code Council (IECC) and the ASHRAE standard75 by the American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE), Inc. The DOE participate in upgrading the model codes and on publication the DOE is required to make on published a determination as to whether these new codes or revisions would save energy in buildings relative to the previous edition. By a positive determination for a new or revised IECC codes states are required to report and certify to DOE whether it is appropriate to update their residential codes to meet the new requirements, or they have to explain why it is inappropriate to do so. By a positive determination regarding the ASHRAE standard, states are required to update their commercial energy codes to meet the standard and demonstrate that they have done so.

The DOE is required to provide financial and technical assistance to assist states to upgrade, implement, and enforce their energy codes 76 and DOE provides information on the implementation of building codes in the individual states77.

In Canada there is a similar situation where requirements for energy efficiency are set by the states based on model codes, National Building Code for Canada 200578. Rules for energy efficiency for heating, ventilation and air conditioning are set in Part 6 of this code including calculation procedures for energy performance. The code is developed by the National Research Council, Canada and the Canadian Commission on Building and Fire Codes.

Two different standards
The ASHRAE and the IECC standard codes are both built on prescriptive efficiency requirements for each part of the building and installations or trade off models where

72 Least cost optimum is calculated with an oil price on 70 USD per barrel. After the calculations were done the price increased substantially. If this price level is used the least cost optimum would be lower and the distance between the actual level and the LCA even larger.
73 The IEA seek to involve in a project wit EURIMA and ECOFYS in order to develop and test a model to estimate least cost options for energy performance in buildings. 74 International Energy Conservation Code (IECC) 2004 supplement set by the ICC. 75 ASHRAE/IESNA Standard 90.1-2004, Energy Standard for Buildings except Low-Rise Residential Buildings, set by the American Society of Heating Refrigerating and Air-Conditioning Engineers. 76 42 USC 6833
77 Homepage http://www.energycodes.gov/implement/state_codes/ 78 Further information on the Canadian National Building Code and requirements and calculation procedures on http://www.nationalcodes.ca/nbc/index_e.shtml
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43 buildings are compared to a model building. The ASHRAE’s residential high-rise79 and nonresidential energy standards as well as the IECC, use four different methods for specifying climate dependent energy efficiency requirements.

Both standards are based on US traditions but in the last few years there has been a work to merge and complement the codes and a declaration to prepare the codes for use in other parts of the world. Both ASHRAE and IECC are model codes, which are intended to be adjusted to local conditions. Most states use the IECC for low-rise residential and simple buildings while the ASHRAE is used for large and complex buildings and for trade and service buildings.

Both the ASHRAE and the IECC includes requirements for existing buildings by refurbishment. The ICC has also developed a specific standard for energy efficiency in existing buildings IEBC, International Existing Building Code and the model code for residential buildings IRC, International Residential Code. The IEBC basically references the provisions of the IECC and the IRC. The IRC has a specific energy chapter which is substantially the same as select residential low rise portions of the IECC. However, the IECC and IRC are developed separately and there are some differences.

International Energy Conservation Code
The International Energy Conservation Code 2004 (IECC 2004) is a model building code or standard for energy efficiency of new buildings. It was devised by the International Code Council (ICC), and is based on US conditions and traditions for energy efficiency regulation.

This code IECC 2004 sets rules for residential (with less than 4 floors) and for small and less complicated commercial buildings while it contains a reference for the ASHRAE for large and complex buildings80. There is an emphasis on new buildings.

Rules are based on climatic zones, which are set based on cooling degree days CDD and heating degree days HDD and some humidity conditions. In general, the US is split into 8 different zones, based on the level of cooling and heating. Some humidity conditions divide the zones into dry, humid and marine areas.

Rules are set as prescriptive values for building parts, heating and cooling systems, ventilation and lightning. Insulation requirements are set as R-values or U-factor where U = 1/R for each climatic zone separately. These values have to be fulfilled for each building part in the prescriptive model. Some specific regulations are given for pipe and duct insulation, air tightness, sealing, hot water systems, mechanical ventilation and circulation of hot water. Rules for heating and cooling equipment are only given as sizing requirements.

IEEC also includes a trade-off model where some parts can be made with less energy efficiency as long as the total building still fulfils the same overall requirements which would be the result of fulfilling each single demand. In this model the same values are used for the trade off model as reference values for the model building. The trade-off model is based on energy costs which take into account the different energy costs for gas, oil or electricity. Specific and more detailed values are set for some steel solutions. Finally it contains a frame with an overall assessment where total values have to be obtained.

The energy efficiency requirements for residential buildings and those for new commercial buildings are indicated in two separate chapters.

The prescriptive model is described as Mandatory Requirements, while the trade-off model is referred to as Performance Based requirements. Finally there are some requirements for the use of software for the Performance based model. Some basic assumptions are set for

79 ASHRAE only address residential buildings with 4 floors or more above grade. 80 According to the IECC small commercial buildings or parts shall either fulfil the requirements in the specific chapter for non residential buildings or the requirements in the ASHRAE. 1711 of 2287
44 the reference buildings used in the trade off model such as amount of windows (18 % of floor area) and calculation values.

Table 5. IECC 2004, Climatic zones
Zone number Thermal Criteria
IP Units SI units
1 9000 < CDD50°F 5000 < CDD10°C
2 6300 < CDD50°F ≤ 9000 3500 < CDD10°C ≤ 5000
3A and 3B 4500 < CDD50°F ≤ 6300 and
HDD65°F ≤ 5400
2500 < CDD10°C ≤ 3500 and HDD18°C
≤ 5400
4A and 4B CDD50°F ≤ 4500 and
HDD65°F ≤ 5400
CDD10°C ≤ 4500 and
HDD18°C ≤ 5400
3C HDD65°F ≤ 3600 HDD18°C ≤ 3600
4C 3600 < HDD65°F ≤ 5400 3600 < HDD18°C ≤ 5400
5 5400 < HDD65°F ≤ 7200 5400 < HDD18°C ≤ 7200
6 7200 < HDD65°F ≤ 9000 7200 < HDD18°C ≤ 9000
7 9000 < HDD65°F ≤ 12600 9000 < HDD18°C ≤ 12600
8 12600 < HDD65°F 12600 < HDD18°C
Climatic zones in the IECC 2004 are basically based on Heating and Cooling Degree Days although some also take into account the humidity. The zones are adjusted to the state limits to simplify the administration81
.

The IECC apply for major renovation and refurbishment projects too. The values R-values and U-factors (prescriptive) in the regulation have to be fulfilled in some renovation projects, for example a full exchange of windows must comply with the energy efficiency requirements for windows. A special standard is developed for refurbishment of existing buildings, International Existing Building Code (IEBC). 82 Table 6. IECC 2004, U-factors in SI units
Climatic
Zone
Fenestrati
on
U-factor
Skylight
U-factor
Ceiling
U-factor
Wood
Frame
Wall
U-factor
Massive
Wall
U-factor
Floor
U-factor
Basement
Wall
U-factor
Crawl Space
Wall
U-factor
1 6.81 4.26 0.20 0.47 1.12 0.36 2.04 2.71
2 4.26 4.26 0.20 0.47 0.94 0.36 2.04 2.71
3 3.69 3.69 0.20 0.47 0.80 0.27 2.04 0.77
4 Except
Marine 2.27 3.41 0.17 0.47 0.80 0.27 0.34 0.37
5 and
Marine 4 1.99 3.41 0.17 0.34 0.47 0.19 0.34 0.37
6 1.99 3.41 0.15 0.34 0.34 0.19 0.34 0.37
7 and 8 1.99 3.41 0.15 0.32 0.32 0.19 0.34 0.37
IECC 2004 U-factors for different climatic zones in SI units. 83

81 These zones were developed in a special project financed by DOE. 82 Conversion factor Btu / ( h * ft² * °F) => W / ( m² * °K ) for the U-factor = 5.678263337 83 Implementation depends on legislation in the individual state. 1712 of 2287
45 ASHRAE
The ASHRAE 90.1 Standard 2004 is developed by the American Society of Heating, Refrigeration and Air-conditioning Engineers, Inc. This standard applies particularly to large and complex buildings, mainly in the commercial sector, but minimum efficiency requirements are set for all building types exempt for low-rise residential buildings. There is a small overlap between buildings covered by the IECC code and the ASHRAE standard as large residential, small or less complicated commercial buildings are covered by both.

In order to check the compliance with the standard, there is a requirement for labelling of installed equipment or components and also for building parts such as windows, walls and roof. The labelling of built constructions has to be made by the installer or constructor.

The requirements can be fulfilled either by prescriptive values or by calculation of energy consumption. As part of the ASHRAE standard there are normative appendices with values and calculation rules. Some parts are partly mandatory while others are only informative.

There are links to different reference standards that have to be applied to the calculations.

Compliance
Compliance with the ASHRAE standard can be achieved in three different ways:

1. The Prescriptive Approach where all individual requirements for Building Envelope, HVAC systems, Service Water Heating, Power, Lightning and Other Equipment are achieved.

2. The Energy Cost Budget, where the energy consumption must be below a value calculated based on a calculation for the building and fixed values for efficiency.

3. The Design Energy Cost where all parts of the building and the installations have the same energy or better energy efficiency than the figures used for the calculation of the Energy Cost Budget.

The Prescriptive Method
Rules are set in ASHRAE section 5, 6, 7, 8, 9 and 10 and each part of this must be fulfilled individually. If compliance with one part is fails, the whole project is rejected.

Building envelope
The values for insulation and fenestration are given for the similar climatic zones as the International Energy Conservation Code IECC 2004, with 8 general zones of which some which are shared into A, B and C. All in all the code has 17 different conditions for the US while only the general 8 zones are used for Canada.

Values are set for the different parts of the building as U-factors or as R-values (U = 1/R).84 Values are set for separation from conditioned space, heated and/or cooled, to outdoor, to semi-conditioned or unconditioned space and between semi-conditioned spaces and outdoor or unconditioned spaces.85 Values are set for fenestration too, giving R-values or Ufactors, solar heat gain coefficients (SHGC), visible light and transmittance (VT), shading coefficients (SC) for windows and glass areas. Finally values are given for air leakage.

The energy efficiency requirements for the zones are further shared in values for Nonresidential, Residential and for Semi-heated areas. Some values for walls, floors and roof etc. depend on the type of construction – steel, massive, wood construction etc. Values for windows depend on the share of windows.

84 Values are set in IP units, Btu / ( h * ft² * °F).
85 Also called the building envelope.
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46 For the building shell it is possible to make a trade off, where some parts can be improved to a better standard thus allowing other parts to be of a lower standard as long as the total value is still fulfilled.

Heating, ventilation, and air-conditioning
Requirements for HVAC systems 86 are set for air-conditioners, Condensing Units (Dehumiliation), Heat Pumps, Water Chilling Package, Package Terminals, Room Air Conditioners, Heat Pumps, Furnaces, Duct Furnaces, Unit Heaters, Boilers and Heat Reinjection Equipment in individual tables.

Values for insulation of ducts and pipes depend on the type of room in which they are located as the expected temperature inside the pipes and ducts. Requirements and instructions are set for automatics to control HVAC systems as well as for Freeze Protection, Humidification, Dehumidification, Leakage and Sealing. Compliance for HVAC systems are set based on the calculation method.

Service water heating
Requirements are set for commercial water heaters, sizing, efficiency, insulation of pipes and tanks, automatics, circulation pumps, pool heaters, heat traps etc. These are based on the size of the system in kW for electric systems and the Btu/h for gas or oil fired equipment. Compliance can be in the prescriptive method or in conjunction with the calculation method.

Lighting Other Equipment
Commercial lighting efficiency requirements are set as prescriptive values, including controls for the lighting system, such as automatic shutoff and space control and tracking.

Values are set for efficiency in Luminary Wattage and for sizing. A special method is described for the calculation of lightning power density based on the type of functions used in the building (in W/ft²). Values for electric motors are set depending on the horse power for the output.

General
The ASHRAE standard covers new buildings and their systems, new portions of buildings and new systems or equipment in existing buildings. Special rules apply to refurbishment of buildings if this includes extension or increase of the building outside the original building shell. Alterations of the building envelope shall then fulfil the prescriptive requirements.

In an annex to the ASHRAE, standard values for Heating Degree Days and Cooling Degree Days and other climatic information are given for the US and Canadian states, as for major cities. The ASHRAE standard is a very comprehensive standard for energy efficiency in buildings and values are set for different parts of the building, HCAC systems and other installed equipment at a very detailed level and for multiple climatic zones.

General status US and Canada
As it is up to the federal states in both US and Canada to set and enforce minimum standards for energy efficiency in buildings the energy efficiency requirements for buildings vary substantially over the North American continent. Most states have implemented regulations based on the ASHRAE standards for commercial and larger residential buildings and the IECC codes for small residential buildings.

Many states have chosen levels based on the recent levels in ASHRAE and IECC while other states have based the regulations on older versions of these standards or set standards at a lower level. Some states have chosen to take the energy standards further that the ASHRAE and IECC codes, this is in particular the case for California and Florida where substantial

86 HVAC systems are Heating, Ventilation and Air-Conditioning systems. 1714 of 2287
47 resources have been used to develop individual energy efficiency standards. Both the US and Canada provide web homepages with information on the standards in individual states.87
California,
California has probably the most comprehensive minimum energy efficiency standards for buildings in the world. The standards are very detailed, and they regulate nearly every part of energy consumption in buildings including valuable explanations and examples. The Californian codes are shared in a relative simple 88 but comprehensive code for small residential buildings 89 similar to the IECC code and for non commercial and high-rise buildings90 based on the ASHRAE standard.

The California energy efficiency standards for buildings set efficiency requirements which in many ways are higher than those of IECC and ASHRAE. The standards have specific values for efficiency for all parts of the building and for most energy consuming appliances and installations included in the energy performance in buildings are set in the standards and on a very detailed level.

The energy efficiency requirements can either be fulfilled in part (prescriptive rules) or by a calculation based on a comparison with fixed values and the fulfilment of the prescriptive rules (energy model building or a trade of model). The codes include some instructions for installers or constructors on how to fulfil the requirements. Energy efficiency requirements are set for different regions from very hot areas to cold areas in the mountains in the north.

Values are set for different climatic zones.

In particular, minimum energy efficiency requirements compliance manual for nonresidential and high-rise buildings are voluminous (more than 1000 pages), but it contains values which can be useful for many regions in the world.

Ontario
The energy efficiency requirements in Ontario were increased from 1st January 2007, leading to a reduction of an estimated 21.5 % of consumption in new small residential buildings and 16 – 18 % in large residential and non-residential buildings. This is achieved through an increase in the requirements for insulation, windows and efficiency in gas boilers. At the same time it was announced that these requirements for houses would be further strengthened with insulation levels increased in 2010, and that buildings from 2012 would have to meet a national guide line for energy efficient buildings. For non-residential buildings a further increase in energy efficiency will be implemented in 2012. Actual costs and the pay back times for building owners were calculated for these new demands.

Estimates over the costs and feasibility of increased requirements for new buildings shows that the first increase in 2007 were paid back in only 3-4 years, while the large reductions of 35 % for small residential and 25 % for non residential and buildings from 2012 would be paid back in only 5 – 8 years for typical new buildings.91

87 For US especially the http://www.energycodes.gov/implement/state_codes/ DOE homepage is giving an overview of the implementation in the individual state and it includes links to most of these standards.

Additional proposals for energy efficiency are given by the Insulation industry, NAIMA, on WWW.NAIMA.org 88 The Californian Code for small residential are more complicated than the IECC and most other codes for small residential buildings in other states in US and in Europe. 89 California’s energy efficiency standards for low-rise residential buildings. 90 California’s Energy efficiency Standards for Non-residential Buildings, High-Rise Residential Buildings and Hotels/Motels.
91 More information can be found in The Power of Building Better, Increasing the Energy Efficiency Requirements of the Ontario Building Code to Create a Culture of Conservation. 1715 of 2287
48 Table 7. Estimated increased capital costs, savings and payback periods for houses, Ontario.

Estimated
energy savings
Estimated
Increased Capital
Costs
Simple Payback
Periods
December 31, 2006 21.5 % $ 1.600 3.0 years
December 31, 2008 28 % $ 2.700 4.4 years
December 31, 2011 35 % $ 5.900 – 6.600 6.9 – 7.9 years
Compared to the 1997 Building Codes and calculated for a typical 2000 square feet gas-heated house in Centre Toronto Area.92
This example shows that increase of energy efficiency requirements in new buildings can be very cost effective because seen over a 30 years period these savings will be a very profitable investment for the building owner93. It is planned that the new regulation will be followed by a labelling scheme which should make the improvements visible in the market.

Table 8. Estimated increased capital costs, savings and payback periods for non-residential and large residential buildings, Ontario.

Estimated
energy savings
Estimated
Increased Capital
Costs
Simple Payback
Periods
December 31, 2006 16 - 18 % $ 0.98 – 1.11 / ft² 3.3 – 4.7 years December 31, 2011 25 % $ 1.40 – 3.46 / ft² 5.0 – 7.7 years Compared to the 1997 Building Codes and calculated for a typical high-rise residential and office buildings. The range depends on size, type, location and method of construction.

9.3 Japan
Energy efficiency in buildings in Japan is set by two different standards; Criteria for Clients on the Rationalization of Energy Use for Buildings for non residential buildings, and Design and Construction Guidelines on the Rationalisation of Energy Use for Homes for residential buildings. Both standards are part of the national Energy Conservation Law that was first adopted in 1979.

Mandatory schemes are set for the reporting on energy efficiency measures and for labelling of buildings. This includes that buildings with more than 2000 m² building have to report on the efficiency and compliance with these standards. Information on buildings that do not fulfil the requirements can be published by the relevant ministry. For small and medium sized buildings the energy efficiency requirements are not set as mandatory standards and there are no penalties for non compliance, but the Design and Construction Guidelines on energy efficiency, request the owners of small and medium sized buildings to make attempts to comply with these measures. 94 The jurisdiction of both the standards is

92 Background information from the Ministry of Municipal Affaires and Housing, Ontario. Source for estimates of Costs, Savings and Payback Periods http://www.mah.gov.on.ca/scripts/index_.asp 93 Background information from the Ministry of Municipal Affaires and Housing, Ontario Source for estimates of Costs, Savings and Payback Periods http://www.mah.gov.on.ca/scripts/index_.asp 94 Even though that the guidelines and the request to make attempts to fulfil these guidelines to some extend equals obligatory in nature in Japan’s legal system it is the impression that the compliance rate is very low compared with other OECD countries.
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49 in the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) and the Japanese government are preparing a change of the regulation which will make the standards mandatory for a larger part of the buildings and which will increase the enforcement of the standards.95
Residential buildings
The energy efficiency requirements for residential buildings are set in Design and Construction Guidelines on the Rationalisation of Energy Use for Homes. These requirements are in two parts of which one is prescriptive and the other is a performance model. The requirements for residential buildings are set for 6 different climatic regions.

Figure 11. The climatic regions in Japan
Values for buildings in Japan are set for 6 different climatic zones.

Energy efficiency in buildings can be based on a performance model as an option to the prescriptive model, where the values for the building are set based on the volume of the building.

Table 9. Maximum allowable space conditioning loads for houses by climatic areas
Area classification I II III IV V VI
Standard annual heating and cooling load
(unit: MJ/m3/year) 390 390 460 460 350 290
Values for the maximal energy use indifferent areas set per cubic meter or space in a residential building.

There is a specific calculation procedure, which has to be followed.

95 The MLIT informed IEA in February 2008, that the revision will include mandatory requirements for all new buildings with more than 300 m² and that a further lowering of the threshold is still being discussed. 1717 of 2287
50 Values can also be based on a prescriptive model maximum where maximum values are set for energy loss through construction, U-values, for individual building parts depending on the type of construction and whether insulation is inside or outside the construction. These values vary for different parts of Japan.

Table 10. Energy efficiency requirements for heat transfer coefficients in residential buildings
Type of
house
Insulation
material &
construction
Building component
Standard heat transfer
coefficient
Area classification

I II III IV V VI
Houses of
reinforced
concrete
structure,
etc.

Constructions
using interior
insulation
Roof or ceiling 0.27 0.35 0.37 0.37 0.37 0.37
Wall 0.39 0.49 0.75 0.75 0.75 1.59
Floor
Portions exposed
to open air 0.27 0.32 0.37 0.37 0.37 -
Other portions 0.38 0.46 0.53 0.53 0.53 -
Floor
edge in
contact
with
earth
Portions exposed
to open air 0.47 0.51 0.58 0.58 0.58 -
Other portions 0.67 0.73 0.83 0.83 0.83 -
Constructions
using exterior
insulation
Roof or ceiling 0.32 0.41 0.43 0.43 0.43 0.43
Wall 0.49 0.58 0.86 0.86 0.86 1.76
Floor
Portions exposed
to open air 0.38 0.46 0.54 0.54 0.54 -
Other portions - - - - - -
Floor
edge in
contact
with
earth
Portions exposed
to open air 0.47 0.51 0.58 0.58 0.58 -
Other portions 0.67 0.73 0.83 0.83 0.83 -
Other
houses
Roof or ceiling 0.17 0.24 0.24 0.24 0.24 0.24
Wall 0.35 0.53 0.53 0.53 0.53 0.53
Floor
Portions exposed
to open air 0.24 0.24 0.34 0.34 0.34 -
Other portions 0.34 0.34 0.48 0.48 0.48 -
Floor
edge in
contact
with
earth
Portions exposed
to open air 0.37 0.37 0.53 0.53 0.53 -
Other portions 0.53 0.53 0.76 0.76 0.76
Values for the different parts are set in W per °C pr sec. Different values are set for different types of constructions and for reinforced concrete structures, and other types of buildings.

Commercial buildings
The Criteria for Clients on the Rationalisation of Energy for Buildings sets rules for energy efficiency in commercial buildings and high-rise residential buildings. This standard is based on energy performance or energy frame values. These values are mainly set for two types of values PAL, Perimeter Annual Load for the performance of the building envelope and values CEC, for the Coefficient or Energy Consumption for the Equipment. 1718 of 2287
51 The two values are calculated by the following formulas:

PAL =
Area of perimeter zone (m )
space Annual conditioning load in perimeter the (MJ/year) zone 2 CEC =
Standard Energy Consumptio (MJ/year)n
Actual Energy Consumptio (MJ/year)n
PAL values are set in general for the whole building using the Perimeter Zone, which is set as perimeter spaces, that is 5m within the exterior wall, plus the top story just under the roof. There are also some correction factors to account for differing surface to volume ratios.

The CEC values are set for different parts of the HVAC systems. The values for PAL and CEC are set for different types of buildings and for different climatic regions of Japan. CEC values are set for the HVAC system in general, and specific for ventilation (V), lighting (L), hot water (HW) and the elevator (EV).

Table 11. PAL and CEC requirements by commercial building types Building
type
Hotel Hospital
or clinic
Retai
l
Offic
e
School Restaura
nt
Hall
PAL 420 340 380 300 320 550 550
CEC/AC** 2.5 2.5 1.7 1.5 1.5 2.2 -
CEC/V** 1.0 1.0 0.9 1.0 0.8 1.5 1.0
CEC/L** 1.0 1.0 1.0 1.0 1.0 1.0 1.0
CEC/HW** 1.5 – 1.9 (depending on Ix)
CEC/EV** 1.0 - - 1.0 - - -
The PAL values are set in MJ/m² per year, while the CEC values are factors for efficiency of specific appliances. Ix means sum of circulation pipeline length and primary pipeline length (m) over averaged daily water consumption rate (m3). ** AC:

Air-Conditioning, V: Ventilation, L: Lightning, HW: Hot Water, EV: Elevator.

For V, L, HW and EV, equations are set by MLIT for the calculation of the actual and the standards of energy consumption.

Supporting measures
The voluntary standards for energy efficiency of residential and commercial buildings are supported by different measures including the Housing Qualification Assurance Law of 2000, setting rules for a voluntary housing performance labelling system for new buildings for the protection of consumers. This is based on many different aspects including safety, stability, and indoor air quality and energy efficiency. Building efficiency is rated in this system.

A voluntary system is set up for Green Building Rating; this system is called the CASBEE system, Comprehensive Assessment System for Building Environmental Efficiency.

The building efficiency standards for new buildings in Japan are also supported by the top runner program for energy efficiency in appliances including air conditioners and by energy efficiency standards for many appliances. The Top Runner Programme sets a high energy efficiency target for different products. Companies – who want to be a Top Runner – have to show that the average efficiency of their products is better than the minimum efficiency value. This helps to ensure that products of high energy efficiency standards are available on the market, including HVAC products such as heaters, coolers, water heaters and fans. 1719 of 2287
52 Conclusion
The Japanese regulations have lead to very high energy efficiency in appliances and other equipment installed in buildings. As well the building codes, the supporting initiatives promote the development of very efficient installations. In the building regulations the CEC values are set for the HVAC system in general and for the individual parts.

Energy efficiency in installed products is also highly promoted through the labelling standards and the top runner schemes, which has lead to highly efficient appliances in general.

9.4 Australia, New Zealand
In Australia the regulations for energy efficiency in new buildings are set by the national government, but to be enforced have to be adopted by the federal states. In the present building regulations there is a 5 star system for rating energy efficiency in both residential and commercial buildings. These stars have been quite successful and have been used to drive the market towards higher efficiency than minimum requirements. The fifth star was introduced in order to include a rating for buildings beyond the old 4 star system.

In the state Victoria the local government has decided to use 5 stars as the mandatory minimum requirement, and this way promotes and ensures highly efficient buildings. For the construction industry the energy stars function as a warning for future building regulations and gives the industry time to test new standards and develop appropriate solutions.
10 Developing Countries

10.1 China
Energy efficiency standards in China have been adopted in separate standards over time:
 Energy efficiency standard for residential buildings in the Heating Zone in north China, from 1986 and revised in 1995. (Heating Based Climate)
 Standard for the residential buildings in the Hot-Summer and Cold-Winter region in central China, from 2001. (Mixed Climate)
 Standard for the hot summer- Warm Winter in South of China, from 2003. (Cooling Based Climate)
 Standard for tourist hotels, from 1993.
 Standards for public buildings, from 2003.

Some of the major cities such as Beijing and Shanghai have special standards.

In the past, compliance with the existing regulations was a large problem. Although today this situation has improved, there is still need for further improvement.

Energy efficiency requirements are set based on U-values for constructions and these vary in different codes. The codes also set different rules for the HVAC systems for energy efficiency requirements for boilers, air-conditioners, insulation of pipes etc.

A new building code for all of China is under development and expected to be issued in 2008. Values will be set for 5 different climatic regions and are set separately for residential and for public (commercial) buildings. In some regions the energy efficiency requirements are further split in 2 – 3 different sets of requirements based on the Heating and Cooling Degree Days96
.

96 Heating Degree Days 18 °C are used for heating and Cooling Degree Days 26 °C are used for the cooling. 1720 of 2287
53 The energy efficiency standard is developed by the Central Ministry of Construction, MOC, but the implementation and enforcement are to the responsibility of the regional governments.

China already has a green Building Rating System but is interested in establishing a certification or labelling system for buildings to help ensure the efficiency of new buildings and the visibility of energy efficiency in the market place.

Figure 12. China climate regions as defined by the Ministry of Construction.

Cold
Sever
e Cold
Hot Summer
Cold Winter
Temperate
Hot Summer Warm Winter
Severe
Cold
Severe Cold Cold
Cold
Sever
e Cold
Hot Summer
Cold Winter
Temperate
Hot Summer Warm Winter
Severe
Cold
Severe Cold Cold
Climatic zones in China as indicated by the Ministry of Construction. Severe Cold and Cold zones are the heating based regions, Hot Summer and Warm Winter and the Cooling based zones. Hot Summer Cold Winter and Temperate are the mixed zones where both cooling and heating is used.

Energy efficiency in new buildings in China is important as a substantial part of the world’s new construction is in China. According to the Ministry of Construction in China, more than 2 billion m² are constructed in China every year, which accounts for more than 40% of all new constructions in the world.

10.2 India
Until 2007 there were no energy efficiency requirements for new buildings in India, but a new regulation for large commercial buildings were adopted June 2007. The building code target large commercial buildings, defined as buildings with a connected load of 500 kW or greater or a contract demand of more than 600 kVA or with a conditional area of more than

1.000 m².

The energy efficiency building code includes both a prescriptive and an energy performance method. The values for efficiency in the prescriptive part are very detailed and include many options. The building code is inspired by the ASHRAE code and the building code in California.

The building code was issued in 2007, but will be voluntary at first as it has to be adopted by each of the individual federal states to become mandatory. It may take further time before the code is enforced and controlled as this is the first time such a system is introduced in India. The Ministry of Power has estimated that it will take 1 year for the code to become mandatory and further 1 – 2 years before sufficient control and sanction systems are in place.97

97 In the final communiqué from the joined India and IEA workshop on Buildings Codes and Energy Efficiency in Buildings held in Delhi the 4 and 5 November 2006.
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54 The introduction and enforcement of a building code for large commercial buildings in India is very important as it is projected that India will build more commercial buildings in the next 5 – 7 years than exist at present.98 Some of India’s recent buildings have extremely high energy consumption for cooling owing to large glass surfaces with very little sun protection. Shading is an important part of the proposal for the energy efficiency building code.
11 Comparison of U-values in OECD countries
Comparison of energy efficiency demands in Building Codes, or standards for energy efficiency in new buildings, are as discussed earlier in the paper complicated, because the demands will dependent on local traditions and on the climatic conditions in the individual country or state. Sometimes the conditions even vary substantial within one country or state.

Since it is impossible to compare regulations between climates which are fundamentally different, comparison will only be made alone in heating-based climates or alone in cooling-based climates. In combined climates with extensive needs for both heating and cooling the comparison is difficult and different elements for cooling and heating have to be added or compared.

Much experience with setting requirements for energy efficiency exists in cold and heating based climates, as the lack of insulation or efficiency can lead to substantial health problems for residents. Energy efficiency regulations to reduce the need for heating are well-known in these parts of the OECD. This comparison will, therefore, concentrate on cold and heating based climates, where there little or no need for cooling or where cooling is only used to a minor extent and is of less concern. This climatic situation exists for the majority of Europe and a large part of the US and Canada, but also for a significant area of Japan, a part of southern Australia and for New Zealand.

As discussed in the chapter on different types of codes, the demands in energy requirements (Building Codes) can be set in fundamentally different ways; some codes set demands for the whole buildings energy performance while other codes have requirements on the individual parts of the building and the heating and cooling systems etc.

This comparison will therefore focus on values set on the individual building parts – prescriptive values – and will only include the building itself. The aim will be to compare uvalues for different building parts and building regulations with the major aim of reducing heating.

11.1 Methodology
By this comparison, u-values for the individual building parts are compared separately. This includes values for ceilings, external walls, floors and windows. Different values are set in different states or regions. In North America, the values are set as R-values for building some parts as ceilings, walls and floors, while values are set in u-values for windows. All values are recalculated into u-values and the comparison is made in SI units.99 Some building codes sets values for different constructions such as timber frame walls, heavy massive walls or cavity walls. In this case both the lowest and the highest values are used and compared

98 Information given at the joined India and IEA workshop on Buildings Codes and Energy Efficiency in Buildings held in Delhi the 4 and 5 November 2006
99 Other values for windows, such as light transmission and shading, are not taken into account. 1722 of 2287
55 In the US, u-values for windows are often set as different values, depending on the amount and size of windows. Larger areas of window imply lower u-values for the windows and often these values are dependent on the ratio of windows to floor area – in this case both lowest and highest maximal values for windows are used for the comparison100. This can give multiple points for the same location in the same state and will hence spread the values further.

In Europe, u-values are in some cases only set as absolute minimum values, because the real values are determined by the total energy performance of the buildings. This gives to some extent a difference in the representation of the values. Hence, stricter values could have been used for the comparison, since the u-values in actual typical houses will need to be lower to fulfil the energy performance demands.

Values in the comparison mainly focus on those for residential buildings – where these values are mostly common - and in some cases only small residential buildings such as one and two family houses. For many countries these values are similar to those for nonresidential buildings. However, in some countries these values for non-residential buildings are different or compliance demands are set different for these buildings.

The u-values are illustrated based on the climate in the countries, states or the cities. This is based on heating degree days. Values are calculated on base 18 °C and US values for 65 °F which are quite similar.

The comparison is made only for countries, regions or areas with major heating needs the so called cold climates and the heating based climates. This includes some states the US and some parts of other states,101 Canada, most of Europe although only parts of some southern European countries, parts of Japan102, southern parts of Australia and for New Zealand.

Cooling is taken into account for the areas within the heating based climates and 50 % of the cooling degree days base 18 °C or 65 °F are added to the heating degree days used for the comparison. This gives a modified number of heating degree days for the comparison, which is a little different from the values which can be obtained from the national weather databases.103 All modified heating degree days are recalculated into HDD 18 °C.104 The calculation of corrected heating degree days can be illustrated as:

HDD corr = HHD 18°C + 0.5 * CDD 18°C
By the selection of u-values and climatic data major cities or a representative range of values are chosen for the individual countries and states. In the US, Japan and some European federal states, values are set for different zones in the states or the country. In this case some cities are chosen to illustrate different zones in the individual states or countries. Therefore, not all cities and all parts of states and countries are illustrated in

100 Values can for instance indicate the level if the windows account for 12 % of the floor area and the graduated until they account for 25 %. Stricter levels are typically set by large are of windows. In this case minimum and maximum values are used in the comparison.
101 Only countries, states or cities where the cooling needs in term of CDD 18° are less than 60 percent of the HDD 18 °C are included in the comparison
102 The requirements for Japan are only set as guidance. These values are not mandatory, but are still included in the comparison.
103 For the model building code – International Energy Conservation Code – the values for cooling degree days were only given for base 50 °F and these values are substantial higher than the values for 65 °F. The modified heating degree days for this code are hence only modified with 25 % of the cooling degree days to be comparable with the other values.
104 Heating degree days in HDD 65°F are 1.8 times higher than values set in 18°C. 1723 of 2287
56 the graphs, only the representative areas and those parts representing cold or heating based climates.

Values for the individual building parts are set in many countries. These graphs only illustrates part of these – around 60 states and nations are represented in the graphs with more than 200 sets of u-values and modified heating degree days,

11.2 Possible misinterpretation of the values
Even when limited to u-values for building parts there is a big difference in the way these values are set in the different regions. Some countries set different values for different types of walls or floors and maybe there are even some types of constructions, which are not regulated. Other countries set one common fixed value, which cover all types of walls.

This is also the case for ceilings and roofs or different types of floors, depending on whether these floors are placed on grown or over air.

Some countries only use u-values to support an overall demand for the energy performance, where the real requirements for insulation and efficiency are set. Hence, u-values only represent the absolute minimum for the constructions – maybe only for health reasons or to prevent moisture or lack of comfort - while the real values normally will have to be higher to ensure compliance with the overall performance requirement. In this case the u-values represent a kind of “a lower minimum requirement”. This is often the case in Europe, where the Energy Performance in Buildings Directive requires that building codes are set based on the energy performance of buildings. In other states or countries values are set either on prescriptive u-values or as an overall frame for the building. This means that values can often be lower than the maximum u-values given in the building code, and that these values represent “a minimum requirement”. This will in general underestimate the demands in some European countries, since the actual u-values have to be lower.

For some countries or states there is a possible trade off between the values, but this only influences the actual levels to a very limited extent. This is the case for most North American values. In the US, values for windows are often set depending on windows area in the building and different values are set based on the percentage of windows in relation to floor area. In some cases increased area of windows even increase the requirements for other building parts too. In this case multiple values are presented in the graphs.

In other states and countries the values are the absolute minimum, while the stricter demands by increased area of windows are regulated trough the demands for the overall performance of the buildings, which automatically will increase the demands for the windows or for other parts of the buildings with increasing area of windows.105 This gives a difference in the values and the best US values should hence be lower than the European values.

In some regulations u-values are set to take into account losses in thermal bridges, in other regulations specific values are set for thermal bridges while the u-values for the construction only covers the general value. This can influence the values to a minor extend.

Similar, separate values for transmission constants, thermal bridges, light transmission etc. can be set in building codes, while other codes only include only one single value.

These differences have to be taken into consideration when values are compared and the results are analysed.

105 When windows are included in overall energy performance requirement, larger surface of windows increase the heat loss and this will automatically raise the demands for windows or for other parts of the building. In countries with energy performance requirements there will hence typically be no differentiated demand for windows.
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57 11.3 Comparison ceilings
Figure 13 illustrates the u-values for ceilings, roofs or used attics. Values are shown as a function of modified heating degree days.

Figure 13. U-values for ceilings for selected OECD countries with cold or heating based climates.

U-values for Ceillings
0,00
0,10
0,20
0,30
0,40
0,50
0,60
0 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000
HHD 18°C Corr.

Max. U-value (W / (m² * °C * s))
EUROPE:

IECC
Japan:

North America
Australia, New Zealand
Heating degree days for heating based countries are modified for cooling. Values for ceilings also include values for insulation around heated attics or in roofs. One location can be represented by if more different values are set for different types of constructions.

There are large differences in the level of requirements for u-values for ceilings in the OECD countries. The requirements for ceilings are rather high in North America compared to other regions meaning that the u-values are substantially lower than Europe, Japan and Australia. In general, U-values in the US and Canada are close to or slightly better than the IECC 2004 standard and u-values are typically under 0.20 W per m² per second and per °C.

In Europe the values are quite spread and there is a substantial difference between south and north. Values for northern Europe are close to the US values, while level for the values for southern Europe varies substantially and generally is higher than values from similar climates in the US.

11.4 Comparison walls
U-values for walls for three construction types: timber frame, massive or cavity walls are shown in Figure 14. Values are shown as a function of modified heating degree days.

U-values for walls are rather diverse in all regions and there are large regional differences.

These values vary, especially in Europe, and there is a large difference between the north and south of Europe. Values from north of Europe seem to be slightly stricter than for similar climates in North America. Values from the south of Europe are often substantially higher than for similar climates in North America. Japanese values are in general higher both for concrete enforced buildings and for wooden constructions.

Most states in the US and Canada have implemented higher demands for external walls than the values in the mode building code IECC. For some codes only certain types of walls are 1725 of 2287
58 included or there are different values for timber frame and heavy constructions. Many states in North America are represented by more values for different types of walls.

Figure 14. U-values for external walls for selected OECD countries with cold or heating based climates.

U-values for Walls
0,00
0,20
0,40
0,60
0,80
1,00
1,20
1,40
0 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000
HHD 18°C Corr.

Max. U-value ( (m² * °C * s))
EUROPE:

IECC
Japan:

North America
Australia, New Zealand
Heating degree days for heating based countries are modified for cooling. Values include values for timber frame constructions, massive walls and cavity walls. One location can be represented by multiple dots.

11.5 Comparison floors
Figure 15 illustrates the u-values for floors on slab ground, over unheated cellars or over open air. Values are shown as a function of modified heating degree days.

U-values for floors in heating based regions of North America are in general lower than the similar values in Europe. In particular, this is the case when values from southern Europe are compared with similar climates in the US. In some northern countries in Europe the values are, however, stricter than the similar climates in the US and Canada. Japanese values are rather consistent with the European values. The Japanese values for timber frame constructions are even close to American values. U-values in North American states tend to be at level or higher than the model standards IECC.

11.6 Comparison windows
U-values for windows are illustrated in Figure 14. Values are shown as a function of modified heating degree days.
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59 Figure 15. U-values for floors for selected OECD countries with cold or heating based climates.

U-values for Floors
0,00
0,20
0,40
0,60
0,80
1,00
1,20
1,40
1,60
0 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000
HHD 18°C Corr.

Max. U-value (W/ (m² * °C * s))
EUROPE:

IECC
Japan:

North America
Australia, New Zealand
Heating degree days for heating based countries are modified for cooling. Values include values for floors on the ground, over air or over unheated heated cellars.

One location can be represented by multiple dots.

Figure 16. U-values for windows for selected OECD countries with cold and heating based climates.

U-values for Windows
0,0
0,5
1,0
1,5
2,0
2,5
3,0
3,5
4,0
4,5
5,0
0 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000
HHD 18°C Corr.

Max. U-value ( W / (m² * °C * s))
EUROPE:

IECC
Japan:

North America
Australia, New Zealand
Heating degree days for heating based countries are modified for cooling. One location can be represented by multiple dots if different values are set depending on the area of windows.

The u-values for windows vary substantially and there is up to a factor 3 between the most efficient and the less efficient windows in similar climates. Requirements for windows are stricter in Europe than in the US and Canada, and some states in North America do not have 1727 of 2287
60 requirements for u-values in windows. Some states set requirements for types of windows, for instance double glass or for energy efficient glassing.106 Values for North America are rather diverse and several states have implemented values, which are stricter than the requirements in the model building codes. For some US states, there are different values dependent on the surface of windows meaning that a larger surface of windows will lead to a higher demand for the windows.107 Several values can be shown for these states and this adds to the diversity.

11.7 Overall comparison of prescriptive values
As can be seen from the comparison of the individual parts of the buildings there are substantial differences between the different regions of the OECD. These results do not point in favour of one single region, but show that lessons can be learned in all regions and that there is still room for improvements of the requirements.

To valuated the total efficiency of the building envelopes of these prescriptive regulations a common over all u-value could be developed. This overall value would take into account the values for ceilings, walls, floors and windows. A simple overall u-value adds the uvalues for ceilings, walls and floors with a modified value for windows. Windows are in this value only calculated with 20% since the area of windows for small residential buildings normally will be less than 20 percent of the floor, ceiling and wall areas, and because the values for windows would otherwise totally dominate the overall u-value.

Uoverall = Uceiling + Uwall + Ufloor + 0.2 * Uwindow
The overall U-values for requirements, which include all these u-values, are shown in Figure 17. In case there are different u-values for the same construction part the value is calculated as a mean between the maximal and the minimal value for these parts giving only one value for each city, state or country.

106 Energy efficient glazing could be low energy glassing with double or triple layers of glass windows, and / or where the room between the windows is filled with gasses with thermal reduction and where the glass is covered with foil to reduce the transmission of heat or sunlight. 107 These values can be set a window area on 12 % of the floor area, with additional and gradually stricter values for 15 %, 18 %, 21 % and up to 28 %. In case of several values highest and lowest value are plotted on the graph. 1728 of 2287
61 Figure 17. Overall u-values for selected OECD countries with cold or heating based climates shown as function of heating degree days.

Over All U-values
0,00
0,50
1,00
1,50
2,00
2,50
3,00
0 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000
HHD 18°C Corr.

Max. U-value (W /(m² * °C * s))
EUROPE:

IECC
Japan:

North America
Australia, New Zealand
Heating degree days for heating based countries are modified for cooling. Values include values for ceilings, walls, floors and windows. One location, state or country is only represented by one dot.

There is a big difference in how the prescriptive requirements are implemented in the different regions. In Europe there are substantial differences between the northern and the southern parts. In the north of Europe the requirements are quite strict, while the picture is more mixed in the South.

In North America the requirements seems to be more homogenous, probably because of the model codes for energy efficiency of buildings the IECC and the ASHRAE. Values for the states are in quite good compliance with especially the International Energy Conservation Code, IECC.

The most strict code in terms of overall u-value was found in Sweden with an overall value close to 0.7, followed by Denmark (0.77) for renovation or extensions, while u-values are not set for totally new constructions108, and Norway (0.84) and then followed by Finland (0.94) and Ontario for the coldest part of the climate with more than 5.000 HDD 18°C (0.93).

The Swedish building code is in fact based on energy performance and the values for individual building parts are only set to support these values. Buildings will, therefore, typically have to be built to even stricter requirements than these u-values in order to fulfil the over all values.109
The main level for prescriptive values in the building codes in Central Europe and North America are approximately at the same level.

108 Values for new constructions in Denmark are only set as an overall performance. U-values will typically need to be lower than the above values for extensions and refurbishment. Some u-values for new buildings are set to avoid condensation and loss of comfort and some standardisation. 109 The actual level of u-values in Sweden based on the energy performance demand is shown earlier in this paper.
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62 Passive houses110 would be substantial lower than these values and would have a value close to or less than 0.5 compared to the Swedish values on 0.7 and other values, which with few exceptions are larger than 1.0. Using passive house standards as building codes would, therefore, typically more than halve the energy losses in new buildings alone by better requirements for the building envelope.111 For some countries this is even a reduction by up to 75 – 80 %.112

11.8 Comparisons Cooling Based Climates and Energy Performance There are less data available to compare for hot and cooling based climates and a different valuation needs to be made concerning the different building parts, since the ceiling insulation is highly efficient and needed, while there would be less concern on insulation of floors, because floors can have a cooling effect in the hot seasons.113 Windows would also need a special treatment and this should include shading as well as light transmission, which needs to be taken in account in the overall evaluation.

Comparison of energy performance will require more details on the calculation methods including which consumptions are included and how the calculation is performed. When requirements are set as energy performance or an overall frame this is calculated in different ways in different countries and regions since only regional or national calculation methods exists so far. A complicated model or method needs to be established to compare performance values. This will require many decisions and an agreement on the right model on how to compare and treat different elements, which will influence the comparison substantial.

11.9 Conclusion
When prescriptive values in building codes are compared based on heating degree days there are some differences between the regions. Requirements for ceilings and floors are relatively high in North America, and values for ceilings are higher than comparable climates especially in Southern Europe and Japan.

Requirements for walls are higher in Northern Europe than in North America and Japan, while the values for walls are higher in the US than in similar climates in Southern Europe.

Requirements for windows are higher in Europe than in North America.

In the US and Canada most values are close to or slightly better than the model building codes for energy efficiency and they seem to be quite homogenous. Values in Europe vary substantial and especially there is a large difference between high demands in the North and more differentiated and lower demands in the South of Europe.

The highest requirements for u-values are found in the Nordic countries and in Ontario in Canada. Sweden has the highest requirements found in this comparison of u-values closely followed by Denmark and Norway.

110 See the information paper on Energy Efficiency Requirements in Building Codes and Energy Efficiency Policies for New Buildings.
111 In passive houses the supply of energy from sun as from persons and appliances will take a much larger share than in traditional buildings. This will mean that such standards – based on passive houses - would dramatically reduce consumption in cold and heating based climates, where these buildings are well tested and often feasible.
112 In passive houses the energy demand would be further reduced through efficient heating and ventilation systems, from heat recovery and other energy efficiency measures. 113 Different studies indicate that floors can have a cooling effect in the hot seasons. This indicates that floors should be less insulated in cooling based climates. See for instance the ECOFY studies on energy potentials in Europe. Roof will on the other hand have a larger impact since the roof is both heated by outdoor temperature and direct sun radiation. In cooling based climates there is hence an increased need to balance the values and to use energy performance in the regulation
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63 Lessons can be learned in all regions of the OECD and there is a substantial room for convergence especially in Europe. Compared to passive houses, there is still quite some room for improvement of building standards.
12 Enforcement, encouragement

12.1 Why are carrots and sticks needed?
High requirements for energy efficiency in new buildings will only have an impact if new buildings are actually constructed in accordance with the requirements.114 Since there are so many barriers and as the construction of new buildings is complicated, there is a need for enforcement of efficiency regulations for new buildings.

Often there is a high interest in the incremental costs of a new building, and during design and construction to keep down the costs even if this increases the final cost for the users of the building. This will as mentioned under barriers for energy efficiency normally work against energy efficiency because the gain of low energy consumption will only show with time while the increased costs are immediately evident.

The building process in general is complicated and complex for the ordinary builder and difficult for buyers of new buildings to ensure that the rules for energy efficiency are fulfilled. Good building codes should therefore be combined with strong enforcement systems.

12.2 Enforcement systems
Enforcement systems will depend on the type of building regulation that is used. If building efficiency is a part of the general building codes and rules for buildings it will often be enforced in the same system as other requirements in the building codes. If the code is set in a specific standard it may be decided to leave the control up to a specific system for energy efficiency or to combine this with other types of control. In many cases, it is up to the local authority to control the compliance on building regulations.

Both systems have advantages; if the control is combined with that of other building regulations this will typically imply systems to deny buildings to be taken into use or other sanctions which also apply for safety reasons etc. But, on the other hand, if compliance is controlled by energy efficiency specialists this may ensure that these controllers have the necessary knowledge.

In some countries control of efficiency is based on accreditation systems where responsible experts can loose the right to construct or to apply for permits if the rules are violated.

Examples on enforcement
One example of an initiative to support building codes is an energy inspection of buildings.

According to the European Directive on Energy Performance all new buildings must be certified by an independent expert. Some countries use this to ensure that energy efficiency requirements are fulfilled, for example both Portugal and Denmark have introduced new regulations. In both countries the buildings energy efficiency must be declared before the building is constructed. This can be done by the architect or the company responsible for the construction. After construction, a certificate has to be issued by independent consultants including review of the self declaration. If the building fails to

114 The compliance of building codes is a major problem in many countries both in the OECD and in the developing countries. IEA will conduct further studies on compliance with energy efficiency requirements in 2008 and this will include building codes.
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64 comply with the regulations, the use of the building can be denied until an adequate efficiency level has been obtained115.

In Denmark these requirements are based on investigations which showed that as many as 67 % of all new buildings failed on the energy efficiency requirements for insulation of pipes and tanks, and that up to a 1/6 of general construction costs was used to repair constructions and installations, which were incorrectly carried out in the first place.

Several countries use certificates of compliance of energy efficiency requirements for new buildings, including many European countries, Japan and Australia.

12.3 Encouragement systems
Another incentive to fulfil building codes or efficiency standards can be given through encouragement systems, which support compliance with requirements. This can be a subsidy, which will only be obtained if certain energy efficiency requirements are fulfilled.

These can either be based on the pure compliance with requirements in the codes or it can be requirements, which are stricter than the energy efficiency requirements in these codes.

Examples on encouragement
In different regions of Austria there are subsidies combined with energy efficiency requirements, which are stricter than the minimum requirements in the building codes.

This can be additional insulation, improved windows or installation of renewable energy sources such as solar collectors, photo voltage or biomass ovens or boilers. In some Austrian provinces this has lead to nearly all buildings being constructed with an energy efficiency which is better than the requirements in the codes, but as a minimum the requirements are fulfilled.

In US tax incentives have been given in the last years to increase the level of insulation and to encourage the constructer and building owners to go further than the minimum requirements. These incentives have probably also helped to increase the compliance with the codes.
13 Beyond the Building Codes
Building codes and energy standards for minimum energy efficiency set minimum requirements for energy efficiency for all new buildings. In many cases it is as shown above possible and feasible to build with a much higher efficiency thereby improving the economy over the long term. No building codes or energy standards found in this study limit constructors or future owners to go for higher energy efficiency. But still the vast majority of new buildings are constructed exactly with minimum requirements of energy efficiency.

However, some buildings aim for much higher efficiency standards and among these are:
 Low Energy Buildings
 Passive Houses
 Zero Energy Buildings and Zero Carbon Buildings
 Plus Energy Buildings
Other types of buildings also aim at higher standards beyond the requirements in energy efficiency standards and buildings codes, for example, Green Buildings, Intelligent Buildings, Integrated Design, Sustainable Buildings or Ecological Foot Print.

115The requirement to deliver a certificate is a part of the building code and the control of the certificate is a part of the general compliance check done by the local authorities. The consultants responsible for the certificates are certified and controlled through the national certification scheme. 1732 of 2287
65 13.1 Low Energy Buildings
This term is generally used to indicate that buildings have a better energy performance than the typical new building or the energy efficiency requirements in building regulations, and that the building hence will have a low energy consumption compared to a standard building.

In some countries or regions, low energy buildings are defined by the building codes or in relation to the energy standard. The low energy buildings can be defined as having half the energy consumption or a specific percentage of those constructed according to the standards. Unfortunately there is a large variety in how efficient this will be. First of all it will depend on how this percentage is set and on the actual energy efficiency requirements for buildings or the general standards for new buildings. A building which can be classified as low energy in one country may use more energy than a standard building from another neighbouring country. In some countries the definition of low energy buildings is vague and may be used for all buildings that are better than the minimum standard.

Over time standards have improved and what was low energy standards some years ago may be standard today. If there is no protected definition for low energy buildings this may lead to all new buildings being called low energy, and that consumers will be presented with a low energy building even if it hardly fulfils the actual energy efficiency requirements.

In some countries, therefore, the term low energy buildings can be a little confusing since it has no clear definition. In other countries it is clearly defined and a useful guide for those who want a buildings with efficiency above the standard.

Energy Star, positive labelling
For many countries in the European Union a level beyond the building code is defined as a part of the certification of new buildings, which has to be implemented as part of the Energy Performance in Buildings Directive. Typical specific classes such as A or B on a scale from A-G or A+ and A++ are used to indicate that these buildings are built better than standard. Some countries have used a large part of the scale or even the whole scale to show the difference in new buildings using all the letters from A-G to classify new buildings.

In Germany, Austria, Denmark and Switzerland special standards exists for low energy buildings. Niedrigenergihäuser (G, Au) 30 W/m² per year, Minergie® (Sw) 42 W/m² per year116 of heat demand for space heating and sanitary hot water and Low Energy Class 1 on 50 % and 2 on 25 % reduction of the energy needs in the building code (Denmark).

In Australia different stars are used to show the efficiency of buildings. As many as 5 stars are awarded for maximum energy efficiency. With the increase in energy efficiency requirements over time, the minimum requirements in the state of Victoria are equivalent to 5 stars.

In the US a label called ENERGY STAR is used for buildings which use 15 % less energy than the requirements in efficiency standards for new buildings as defined in ASHRAE and IECC 2004.

116 The 1.1.2009 the maximal transmission value for Minergie is reduced from 42 W/m² to 38 W per m². 1733 of 2287
66 13.2 Passive Houses
A passive house is a building in which a comfortable indoor climate can be obtained without a traditional heating or cooling system. Compared to traditional building they use far less energy. For most countries these demands are 70–90 % reduced compared to the actual energy efficiency requirements for heating and cooling, but this depends on the actual energy standards. For countries with high energy efficiency requirements it is less.

The principle of a passive house
With increasing efficiency the additional costs for energy efficiency measures will increase.

In general the most cost effective measures will be used first. The closer the building comes to zero energy consumption the more costly measures are hence needed to increase energy efficiency and reduce the consumption. At the same time there will be different options where savings will occur, because some installations or equipment is no longer needed.

One of the most interesting reductions in costs is when the energy consumption is getting so low that a traditional heating system is no longer needed and building relationally can be heated alone with the passive solar gains and the ventilation systems.

Figure 18. The additional costs and savings in a Passive House.

Passive house, with increasing efficiency the consumption decrease, but the costs for construction goes up. At a certain point the heating system can be saved and this gives a substantial reduction in costs – this point is close to 15 kWh/m² per year.117
When increased investment costs and capitalised costs for energy over lifetime are added, the final costs for the improved energy efficiency can be found. These total costs are shown in figure 19 together with the capitalised costs for energy.

It can be seen from the graph that the total costs for a building, with 15 kWh/m² per year is lower than the total costs for buildings, which are built to a standard, which require 50 kWh/m². With higher consumption the savings are even higher and at no point the costs are lower than the passive house.

In the example shown in the graph in Figure 19 the costs for a house, which requires only 7 kWh/m² per year, would be same costs as a house build with the demands in the building

117 Based on costs and estimates from the Passive House institute in Darmstadt. Costs are for central Europe (Germany).
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67 regulation with 50 kWh/m², when the costs are seen over lifetime (30 years). Over time there are no additional costs for the owners or users of passive houses.

Figure 19. The total for improved efficiency in a Passive House.

When additional costs and savings in by improved efficiency in buildings are added, the costs will show a drop by 15 kWh/m² per year. The total costs for a building over lifetime for a passive house will hence be cheaper in a passive house (15 kWh/m² per year) compared to a house build according to a building regulation which require 50 kWh/m² per year.118
Similar principles can be used in hot and heating based climates. In this case shading and orientation of building and windows and passive cooling techniques are essential. The points for reduction of costs in passive cooling buildings are different and more dependent on the local conditions and there is no similar specific standard as for the passive heating buildings (Passive Houses).

Definition
To be a passive house a building must fulfil different conditions:119  The building must not use 15 kWh/m²/a or less (≤) in heating energy120.  The specific heat load for heating source at design temperature must be less than 10 W/m².
 With the building pressurised to 50Pa by a blower door, the building must not leak more air than 0.6 times the house volume per hour (n50 ≤ 0.6/h).  Total primary energy consumption (primary energy for heating, hot water and electricity) must not be more than 120 kWh/(m²a).121
The passive house standard was defined in 1988 122 and the first passive house was built in Darmstadt in Germany in 1990.

118 Based on costs are based on an oil price around 60 USD per barrel. With higher oil price the savings are substantial higher and the benefits from the passive house is larger. 119 These are set and controlled by the passive house institute in Darmstadt. The values are particular adopted for the central European countries.
120 The maximum value for heating on 15 kWh/m² per is equivalent to 4.8 Btu/ft² per yr. 121 The maximum energy consumption on 120 kWh/m² per is equivalent to 38.0 Btu/ft² per yr. 122 The passive house standard was defined by Dr. Wolfgang Feist from Institute für Wohnen un Umwelt Darmstadt and Professor Bo Adamson from Lund University of Sweden. 1735 of 2287
68 Figure 20. Principles for a Passive House.

A passive house or a passive building uses the passive solar gains to an optimum and often this needs to be balanced between cooling and heating. The passive house has an extreme degree of insulation – which vary with the local climate conditions – very efficient windows and efficient HVAC systems with natural pre-cooling of air.

Passive houses in practice
Certain construction requirements are necessary for passive houses. They must be:
 Highly insulated. All the building parts for walls, roofs and floors are insulated with Uvalues within 0.10 – 0.15 W/m² per K.  Designed without thermal bridges.123 All thermal bridges in construction have to be avoided. A construction of a passive house is set to be “Thermal Bridge Free” if the maximum bridges are under 0.01 W/m per K.124
 With comfort windows. Windows in a passive house are especially efficient and have three layers of glass, coating on multiple sides and are filled with gas. They will also have warm edges and special energy efficient frames. Overall, U-values for these windows are 0.70 – 0.85 W/m² per K.
 Very air tight.125 The building must be constructed so it is particularly air tight and special care for this must be taken.
 Supplied with efficient mechanical ventilation. To ensure sufficient ventilation passive houses are supplied with mechanical ventilation which will secure a controlled air exchange on 0.40 times per hour.
 Using innovative heating technology. The heating and cooling of these buildings are typically supplied by innovative systems which include a heat exchanger.126 Typically this will be combined with a heat pump or a highly efficient small heating system.

123 A thermal bridge is a part of the construction which leads energy better than the rest of the construction.

This can be the connection between building parts or the foundation of the building. 124 Thermal bridges are typically measured by the amount of energy which will pass trough the thermal bridge per meter of length.
125 That a building is air tight is meaning that no draft can pass trough constructions or between different construction parts.
126 A heat exchanger takes the heat from the indoor air and heats the outdoor air before it is supplied in a heated building and takes the heat out of the out door air if the building is cooled. 1736 of 2287
69 All the details of the building envelope and the HVAC systems in a passive house are made with a high emphasis on energy efficiency. Building details are different from a traditional house, more insulation is added, special care taken with connections, steam tight components used systematically and some constructions changed substantially, such as windows.

Figure 21. Two different examples on comfort windows solutions Constructions for passive houses are substantially different. Comfort windows were developed especially to the requirements in passive houses with u-values below

0.85. This requires 3 layer of glass, filling with gas, coating of the glass, hot separation of the glasses and special frames.

Passive houses are not bound to a specific type of constructions and examples have been designed based on different types of buildings, such as concrete, bricks, wooden frame houses and totally new construction types similar can comfort windows be of different types.

Even if the standard is called passive house it is also used for large residential buildings, commercial and public buildings such as schools, shops or office buildings.

Cooling – limitations
The passive house standard is basically defined for the central European climate, typically a heating based climate where there is only a limited cooling need for comfort reasons. It has moved north to the Cold Climates. A specific project – CEPHEUS127 - supported by the European Commission has tried to take the passive houses out in different countries Germany, Austria, Switzerland, France and Sweden. 14 construction projects with 221 units were built as passive houses and monitored in this project. Some initiatives have been taken to extend the Passive House concept to cooled climates in southern Europe too.

Passive houses is mainly an European phenomena and there is a need to define a further standard, which define the standards and clever solutions for the cooling based and hot climates and which can be useful in all climates.

Benefits and costs comparison
Passive houses will have a comfortable indoor climate; because air is fresh and dry due to the mechanical ventilation and heat exchange of air. Due to thick insulation, there are no "outside walls", which are colder than other walls; floors and windows are not cold either.

Since there are no radiators, there is more room on the walls. The temperature are stable and change very slowly - with ventilation and heating systems switched off - a passive house might looses less than 0.5° centigrade per day (in winter).

In many countries passive houses use 70-80 % less energy for heating compared to other new buildings. Costs for new buildings are only slightly higher than those for traditional

127 CEPHEUS – Cost Effective Passive Houses as European Standard, from 1998 – 2001. 1737 of 2287
70 buildings because the additional costs for insulation and ventilation systems are outbalanced with savings since it is unnecessary to install a traditional heating system.

The result from the CEPHEUS project showed that the additional incremental costs for houses on average was paid back in 20-21 years in simple payback time, and with interest they were paid back in 25 years.128 Since 2001 energy prices have gone up and the costs for special units for passive houses are reduced, because these components become more mature building components. Seen over a 30 years lifetime, passive houses will therefore be a feasible alternative in central and northern Europe compared to houses with standard energy efficiency.

Example on policies to promote passive houses
In Austria and some parts of southern Germany passive houses are generally available on the market. Different programmes to promote these buildings have been very successful. In the Upper Austria province, the passive houses had a market share of 7 % of the market for one family houses in 2006.

The trend for passive house to penetrate the market have been going on in Upper Austria at the same time as low energy buildings have overtaken the major part of the market for one family houses and residential buildings in general. It is expected in Upper Austria that traditional houses will disappear from the market in a few years from now and that the voluntary standard will have moved to low energy. Upper Austria is in general favoured by a relative mild climate with mild winters and a modest need for cooling, but the development towards passive houses has been driven by a very active policy.

Table 12. Low energy buildings and passive house in Upper Austria One Family Houses in
Upper Austria
2003 2004 2005 2006
Traditional new Buildings 67 % 45 % 24 % 15 %
Low energy buildings 31 % 52 % 71 % 79
Passive houses 2 % 3 % 5 % 7 %
Passive houses have taken a major market share in upper Austria. At the same time low energy buildings, which use less than 30 kWh/m² per year for heating, have taken the major market for new buildings.

Parts of the policy to promote passive houses in Austria are subsidies, which can only be obtained by the owner, who constructs passive or low energy houses, certification schemes for buildings document the passive house or low energy class and different promotion initiatives and some very active energy agencies in these states. In Vorarlberg in Austria Passive Houses are now standard for all buildings with public subsidy. Passive houses in Austria are estimated to be around 4 % of all new one family houses.

The increased use of passive houses has made these technologies widely known by constructors and users in Austria. The passive houses standard is also used to an increasing extent, for other types of buildings such as schools, shops and office buildings.

In southern parts of Germany passive houses have taken approximately 2% share of the market for new one family houses, and the standards are becoming commonly known by constructors and installers. Also in Germany there are different programmes to promote passive houses and the passive house standard in general.

128 Average for the 14 projects with 221 residential units in 5 different countries, Austria, Germany, France, Switzerland and Sweden based on 2001 prices.
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71 The passive house concept is spreading in Europe and passive houses are constructed in Germany, Austria, Switzerland, France, Belgium, Holland, Denmark and Sweden. Some experiments with passive houses are also taken in northern Italy and in Spain, where the cooling needs have to be addressed.

13.3 Zero Energy Buildings
Zero Energy Buildings are buildings that do not use fossil fuels but only get all their required energy from solar energy and other renewable energy sources.

Although this seems quite obvious, there is still need for further definition and agreement on clear international standards etc. In particular there is a difference in how the Zero Energy Buildings are used in Northern America and in other parts of the world.

Definitions
Zero energy buildings can be defined in various ways, including:
 Zero Net Energy Buildings are buildings that over a year are neutral, meaning that they deliver as much energy to the supply grids as they use from the grids. Seen in these terms they do not need any fossil fuel for heating, cooling, lighting or other energy uses although they sometimes draw energy from the grid.
 Zero Stand Alone Buildings are buildings that do not require connection to the grid or only as a backup. Stand alone buildings can autonomously supply themselves with energy, as they have the capacity to store energy for night-time or wintertime use.  Plus Energy Buildings are buildings that deliver more energy to the supply systems than they use. Over a year, these buildings produce more energy than they consume.  Zero Carbon Buildings are buildings that over a year do not use energy that entails carbon dioxide emission. Over the year, these buildings are carbon neutral or positive in the term that they produce enough CO2 free energy to supply themselves with energy.129 Defining Zero Energy Buildings
Compared to the passive house standards there is no exact definition for the way to construct or obtain a zero energy building. In principle this can be a traditional building, which is supplied with very large solar collector and solar photo voltage systems. If these systems deliver more energy over a year than the use in the building it is a zero net energy building.

Traditionally it is normal to substantially reduce energy consumption use passive solar energy130, install highly energy efficient equipment and lighting, mechanical ventilation with heat recovery and then use renewable energy to supply the buildings. In cooling based or hot climates intelligent shadowing will prevent the building from being overheated.

Most programmes for Zero Energy Buildings built on these principles; reduce energy demands, use energy gains and reduce need for cooling by shading etc, supply with highly efficient HVAC systems, install highly efficient equipment and lighting and supply the remaining need for energy by renewable sources such as solar collector for heating and PVH or small windmills for electricity. A Zero Energy Building can be a passive house where the remainder of energy is supplied from solar collectors, PVH and other renewable energy.

129 Zero Carbon Buildings differ from Zero Energy Building in the way that they can use for instance electricity produced by CO2 free sources, such as large windmills, nuclear power and PV solar systems which are not integrated in the buildings or at the construction sight. 130 Energy gained from the sun trough windows and glass areas without active solar systems. 1739 of 2287
72 Figure 22. US figure on zero energy buildings
The way to net zero energy buildings in US.131 Best practice for low energy or zero energy homes are expected to be real Net Zero Energy Buildings from 2020.

Normally all energy use in the buildings will be included in the calculation of a zero energy building and this includes installed white goods, lighting, ventilation, air conditioning etc.

In high rise buildings energy use for elevators will be included too.

In hot or cooling based climates in particular, there is a strong emphasis on energy efficient equipment because first these appliances have to be supplied by renewable energy but secondly the waste energy has to be removed by ventilation and cooling.

Examples on programmes for low energy buildings
Zero energy homes. The US program Zero Energy Homes defines the target for the program as the construction of zero energy buildings, but so far the buildings only have to be below 50 % of the energy consumption in the building regulations. In real terms the houses should be called “on the Way to Zero Energy Buildings”. These buildings are in fact to be classified as low energy buildings.

An interesting aspect of the programme is that the defined goal is zero energy use. Special programmes are set up to promote and support these buildings. Help for Finance is provided through the tax credits. Experience from the programme is that buildings cost a little extra but that this can be compensated by the reduction of other installations, for instance in the type of kitchen or by reduced living space. Energy efficiency improvement in these buildings is paid back through traditional loans for new buildings and there will be a positive balance already the first year because the savings more than out balance the additional cost for loans.

When Zero Energy Homes are constructed they are normally sold faster that other similar buildings with traditional energy standard132.

Examples of true net zero energy buildings as well as stand alone zero energy buildings have been built in the past. In Germany zero energy stand alone building was built by the Frauenhofer Institute in 1998 and it was occupied for 3 years by a small family without being connected to any energy grids nor having any energy supply except from the sun. In this example energy was stores in a hydrogen fuel cell.133

131 Graph from Zero Energy Buildings and Zero Energy Homes presentations. David Goldsteen, DOE, on the workshop on Energy Efficient Buildings Meeting the Gleneagles Challenge, Paris 27-28 November 2006. 132 Information from DOE Zero Energy Homes program.
133 Zero energy Stand alone Building. The Solar House in Freiburg, from a self-sufficient solar house to a research platform. Frauenhofer Institute.
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73 The WBCSD134 has defined a project on Zero Energy Buildings. The aim of this project is to develop and construct Zero Energy High-rise Buildings and to promote zero energy buildings in general. Another aim is also to change the buildings industry and to make zero energy buildings and technologies commonly available.

13.4 Green Buildings and Sustainable Buildings
Green Buildings are those with increased energy efficiency, but at the same time reductions are made on water consumption, use of materials and assessment of the general impact on health and environment. Green buildings can include a long list of requirements including resources, indoor air quality and requirements that all products for the building must come from a local region.

Very often Green Buildings will be supported by Life Circle Assessment of the buildings in which there will be a high emphasis on all elements in the life circle, where all phases are assessed. This includes production and transport of materials used for the building, use of resources for the running of the building, but also the disposal or the demolition of buildings are included.

The standards for Green Buildings can vary from region to region and some countries have set up their own definitions for Green Buildings. Some of the more known standards are in U.S, Canada, Australia and U.K, but many other countries have standards.

LEED Buildings
In US and Canada a specific standard LEED135, Leadership in Energy and Environmental Buildings is set up, setting the requirements for the buildings to fulfil. The LEED standard can be obtained on different levels; Certified, Silver, Gold and Platinum with increasing requirements for the different requirements for the building. The LEED standard is set and controlled by the US Green Building Council, USGBC.136

The LEED standard includes Sustainable Sites, Water Efficiency, Energy and Atmosphere, Material Resources, Indoor Climate, Innovation and design. Energy and Atmosphere is the most important criteria for the buildings, but far from the only one and major other areas give the possibility of points too. In connection to the LEED buildings ASHRAE is developing a special standard for the Design of High-Performance Buildings – ASHRAE standard 189P, this work is supported by the DOE. 137 This will lead to further stringency of the LEED requirements in US.

Canada has established its own LEED standards which is set and controlled by the Canadian Green Building Council (CaGBC). There are other Green Building Rating Systems, including the Japanese CASBEE system. 138 Coordination and share of information between the different Green Buildings organisations are done by the World Green Building Council, WorldGBC.139

134 WBCSD – the World Business Council of Sustainable Development is an organisation of more than 180 multinational companies. See www.wbcsd.org
135 LEED standard Leadership in Energy and Environment Design sets demands for all the different parts of the life circle of the building. A certain number of these demands must be fulfilled and the building must obtain a certain amount of points to be classified.
136 USGBC – US Green Building Council, see homepage www.USGVC.org. Similar organisations exist in other countries.
137 The ASHREA 189P standard is a codified version of the USGBC standard for LEED V2.2 and is in public review. 138 The CASBEE system is also mentioned under Japan.
139 World Green Building Council, WorldGBC,139 is an international umbrella organisation, with the homepage www.worldBGC.org, with connection to Green Buildings Organisations in different parts of the world. 1741 of 2287
74 Sustainable Buildings are similar to the Green Buildings, but there are often small differences in the definitions. Often buildings will fall under both the Green Building and the Sustainable Buildings category
14 Dynamic Building Codes

14.1 Building codes have to be changed over time
The construction market is under constant change. New products come into the market and existing products become improved and/or more cost effective. Examples of products, which have come into the market and have gained a market share over the last decades, are low energy windows, condensing gas boilers and highly efficient heat pumps. Today new energy products come in to the market such as Photo Voltaic components, passive solar house heating system units, and comfort windows140.

The energy prices and solutions for heating and cooling change; this will change the limits for what is feasible and rational to set as minimum requirements in building codes.

Similarly will families and companies have new requirements for comfort in buildings and new appliances come in the buildings and will use energy and increase losses from all these appliances.

The energy efficiency requirements for new buildings are one of the drivers for these changes in the markets. With the changed possibilities and the changed conditions for the products and prices will change the feasibility for different solutions. New and more efficient products will lead to the possibility of increasing the requirements for energy efficiency over time.

Examples on dynamic building codes
The increased requirements for energy efficiency in building codes will similarly lead to the development of intelligent solutions and improvements of products. Buildings codes and energy efficiency requirements can be a driver for further development, in particular if they are announced in advance, giving the construction industry time to prepare and develop the right solutions to make the new requirements as cost effective as possible.

The European Directive on Energy Performance in Buildings requirements from all the member states that building standards are set and regularly reviewed and updated. These requirements shall be reviewed at regular intervals, which should not be longer than five years and, if necessary, updated in order to reflect technical progress in the building sector.

The ASHRAE standards and the International Energy Conservation Code, IECC, are also updated regularly and the borders for these standards meet regularly to ensure that the standards are kept up to date, and that new improvements are prepared. New versions are constantly under preparation.

Some buildings codes are set way in advance or some of the energy efficiency requirements in the building codes are phased in slowly to ensure that the industry is prepared for the new solution. One example is the building code for Ontario in Canada, where the new buildings codes, which were introduced in 2006 includes that requirements will be strengthened in 2009 and again in 2012.

Setting energy demands and announcing these years before the change in the demands gives the industry time to adjust and prepare for the new regulation. This reduces the costs by the change and also reduces the criticism from industry or from constructors.141

140 Comfort Windows see under paragraph for Passive Houses. 141 Was the experience by the introduction of “Mindestanforderungen” (WSVO/EnEV) in Germany in the 1980s where this was announced years before and the same did the major changes. 1742 of 2287
75 14.2 Toward Zero energy as building code
Zero Energy Buildings, Passive Houses, LEED buildings and other low energy buildings are driving the best part of the market and help to demonstrate new technology as to develop new energy efficiency solutions and products. Building Codes on the other hand will remove the least efficient part of the new buildings and force these to be more efficient. A strong policy on both building codes and ultra low energy buildings can play together and be a common driver for highly energy efficient buildings.

In Germany such a double sided policy has been working since the 1980s, where research has developed more and more efficient buildings, which have been used to develop, test and demonstrate new solutions. At the same time Passive Houses and other low energy buildings have been used, and subsidised, to move the most efficient buildings towards ultra low energy consumption. This has created a small market for the most efficient products, which has helped the products to mature and be ready for the building market.

Figure 23. Development of ultra low buildings and building codes in Germany.

From Frauenhofer Institute 2006, H.E.

Demonstration projects in Germany have been used to move the limits for the possible energy efficiency and this has opened the way to strengthen the general energy requirements for new buildings. Hans Erhorn from Frauenhofer Institute at the workshop on Energy Efficient Buildings Meeting the Gleneagles Challenge, Paris 27-28 November 2006.

Today passive houses are taking up a small share of the market and this helps new products to be developed for efficient heating with small heat load, ultra efficient windows, building construction without cold bridges and all of this also helps to train constructors and installers to produce these efficient solutions. Then these solutions can then slowly move into the traditional buildings, where for instance thermal bridges today is a major problem for both efficiency and comfort.

In some areas of Austria such as Upper Austria and Vorarlberg142 a similar development towards Passive Houses and other very low energy consuming buildings takes place and passive houses uptake increasingly parts of the new constructions.

Examples on building codes on the way to Zero Energy Buildings In the long term, buildings need to have an energy consumption which is ultra low (Passive House level) or even Zero Energy Building level to be sustainable. Some countries have taken initiatives and have defined this as the target for building codes already in 10 years from now.

In the beginning of 2006 new demands for energy efficiency in building codes was introduced in Denmark for new buildings both for small residential buildings and for large

142
In Voralberg the passive house standard is mandatory for all public subsidized buildings. 1743 of 2287
76 and complex buildings. These building codes are based on energy performance of the buildings but special demands are set for the building envelope too. With these demands new buildings have an energy demand for heating and hot water, which are around 55 kWh / m² per year.

In the new building code 2 new low energy classes are defined at less than 75 % (class 2) and less than 50 % (class 1) of the building code. Parliament have agreed on an action plan where building codes shall be strengthened to low energy class 2 level in 2010 and to low energy class 1 in 2015. This will bring the demands in the building codes in 2015 on the level of the demands in Passive House both for the over all consumption as for heating load in the building.

In UK the government decided an action plan in December 2006 setting a target that all new buildings should be Zero Carbon Buildings in 2016. This includes and action with movement in steps; in 2010, a 25% improvement in the energy/carbon performance set in building regulations; then in 2013, a 44% improvement; then, finally, in 2016, to zero carbon buildings. 143 The UK action plan includes steps to be taken to tighten building regulations over the next decade to improve energy efficiency of new homes and to publish a Code for Sustainable Homes, which includes a green star rating for properties.144 15 Potentials for energy efficiency in new buildings
For new buildings most regulations are far from the least cost optimum if costs are calculated for 30 years based on investment, interest rates, mortgage costs, and accumulated energy costs.

Experience in the US shows that energy consumption in new one family houses can be halved (Zero Energy Homes) and that this will lead to reduced overall costs for the owners already from the first year. This reduction in costs will increase over time.

Comprehensive studies in the US145 show that energy consumption can be reduced by 75 % without additional total costs for the owners. They also show that Zero Net Energy Buildings can be built today with only relative small additional total costs for the owners in terms of higher total annual costs.

In Europe estimates are highly dependent on the building regulations at the present state, but studies show that in many countries the efficiency can be improved by a 70-75% reduction in energy consumption without additional costs or with very limited additional costs for owners.146 A reduction of 70-75 % will in often correspond to a Passive House.

IEA studies on scenarios in 2006 147 show the possibility of a 70 % reduction in most OECD countries over longer time. These results are also supported by the Findings in this study.

However in some countries such as Sweden, Denmark and the Netherlands the demands for new buildings are closer to the least cost optimum and the possible reduction is smaller.

In developing countries the possibilities for savings in new buildings are even larger than in OECD since the present standards for energy efficiency – if they exist – are lower.

143
Zero carbon means that, over a year, the net carbon emissions from all energy use in the home would be zero.
144 Building A Greener Future: Towards Zero Carbon Development, December 2006. 145 Studies described by ICF International consultants and documented in Building a Path Towards Zero Energy Homes with Energy Efficiency Upgrade. Dean Camble, Brian Dean and David Meiesegeier. ACEEE 2006. 146 These savings are documented for instance in the CEPHEUS project on Cost Effective Passive Houses as European Standard.
147 In the scenarios in Energy Technology Policy Perspective, Scenarios & Strategies to 2050. 1744 of 2287
77 If passive houses became more commonly adopted on the market these technologies would become less expensive148 and this could increase the cost effectiveness of these houses and increase the saving potentials even further.

A targeted policy to increase the development of more efficient solutions through demonstration projects, research and development could accelerate this development149.

Such a policy could help Zero Energy Buildings to become a feasible solution.

The conclusion is that passive houses are already a feasible alternative in many cases, and while zero net energy buildings will increase costs, they are not dramatic and it must be expected that these building can become feasible in the within the next 1-2 decades.

15.1 Conclusion on potentials in new buildings
The possibilities for savings in new buildings are calculated based on the figures and forecast from WEO150 and from the forecasts of new constructions and estimates of the efficiency of new buildings and the feasibility. The efficiency forecasts for China and India are of particular importance since approximately half of all the worlds new constructions are in China and India151.

If energy consumption in new buildings is halved compared to the base scenario in WEO this would lead to savings in the size of 10-15 EJ152 (10000-15000 PJ) in 2030 or 230 - 350 Mtoe.

These savings would be feasible both for the owners and for society as a whole.

By a strong policy for ultra low or even net Zero Energy Buildings such as building standards demanding these efficiencies could increase these potentials even further. Saving potentials by Zero Energy Buildings and Passive Houses will therefore increase in the long term.
16 Refurbishment and renovation
Since buildings have a long lifetime of 50 – 100 years or more there will be need for major renovation and improvement in the lifetime of buildings. Refurbishments or improvements are necessary, because some parts of the buildings will need replacing, such as roofs, boilers, windows, variation systems, air condition etc. Change or refurbishment is also necessary because constructions, equipment or the organisation of the building becomes inadequate.

Typically these major refurbishment projects will take place at least 2 or 3 times over the life time of the building. For residential buildings this will typically occur every 30 – 40 years because of change in lifestyle and reduced functionality of the building parts and of heating and cooling systems. For commercial buildings these renovations may happen more often because the functions of commercial buildings change faster. By these major renovations or refurbishment of buildings, energy efficiency is in particular feasible and higher energy efficiency can be obtained.

Improvement of energy efficiency becomes more cost effective by refurbishment, because there is only need to pay for the additional efficiency costs, for instance if windows are replaced it is only necessary to pay the extra costs for efficient windows while the whole price of the windows, the installation, and the removal of the old windows have to be paid

148 CEPHEUS project on Cost Effective Passive Houses as European Standard. 149 Energy Technology Policy Perspective, Scenarios & Strategies to 2050. 150 WEO, World Energy Outlook 2006, IEA 2007.
151 The development of efficiency in buildings in India and China will be studied further in the coming issue of the WEO.
152 EJ is Exa Joule equivalent to 1018 Joule or 277 billion KWh. 1745 of 2287
78 by exchange alone for energy efficiency. Some building parts might be open and it is easy to fit extra insulation for instance in roofs constructions. Costs for scaffolding or establishment of a building site may be paid by the general renovation but might also be used for energy efficiency improvement projects.

Some works can only be done by renovation because the constructions are renewed or opened. This could for instance be floors, which are exchanged and therefore can be insulated or efficiency improved in other ways.

All in all efficiency projects by refurbishment will often lead to better feasibility of the projects, and will also lead to enlarged potentials because of lower better costs for efficiency. Timing for these projects is essential as it is necessary that they are carried out while these works go on. The day after the renovation or the refurbishment project is ended is too late and the next refurbishment or renovation maybe in 30 – 40 years.

The major barriers mentioned for new buildings above will to a large extent also influence projects by refurbishment. Major renovations and refurbishment projects are therefore often carried out without concern for energy consumption and possible efficiency projects.

Efficiency policies and initiatives are required to increase energy efficiency by renovation or refurbishment. Demands for efficiency should therefore be included in the building regulations in the form of building codes or special energy efficiency standards.

16.1 Potentials for efficiency by refurbishment
Different IEA scenarios show substantial potentials for improvement of energy efficiency in existing buildings. In these scenarios costs effective energy efficiency improvements in buildings play a major role in the reduction of the energy consumption. Many regional studies support these findings since the all identify major energy saving potentials in buildings.

A study made by ECOFYS on Mitigation of CO2 Emission from the Buildings Stock 153 supported by EURIMA and EUROACE shows that 55 % of the energy reduction and CO2 emissions from buildings in the 15 old European Union members can on average be saved alone through increased efficiency in the building shell.

A specific study was made for the additional member states from the last extensions of the union. The study carried out by ECOFYS154 for new member states show larger savings giving potential savings for residential buildings of 67 - 80 per cent for the new regions on average for single family houses and 55 - 69 per cent for multifamily houses.

These two studies for the European Union calculated the economic least cost optimum for a 30 years lifetime and only measures, which are feasible for the owners are included in the estimates. Only savings which can be obtained through improvements of the buildings envelope are included. 155 . Further savings can be obtained through improvements of heating, cooling and ventilation systems, through energy supplies such as heat pumps and renewable energy sources such as solar collectors or photo voltage, which are integrated in the buildings.

153 ECOFYS supported by EURIMA and EUROACE, Mitigation of CO2, Emissions from the Building Stock, Beyond the EU Directive on the Energy Performance of Buildings and Cost-Effective Climate Protection in the EU Building Stock.
154 ECOFYS supported by EURIMA. Cost-Effective Climate Protection in the Building Stock of the New EU member States. All report can be found on www.eurima.org
155 Measures are highly feasible for the building owners and money will be retuned up to 7 times over lifetime.

EURIMA Energy savings in a nutshell, 2004 and Ecofys study on Sensitive Analysis of Cost Effective Climate Protection of the EU Building Stock., June 2006, to estimate the impact of high oil prices for energy efficiency. 1746 of 2287
79 Further studies have been carried out in individual member states in the EU156. They show similar potentials for savings, which exceed 50 % for the individual country.

Similar studies from US show that the energy consumption in the existing building stock can be reduced with up to 50 % alone through improved insulation.

16.2 Conclusion on potentials in refurbishment of existing buildings The potentials for energy efficiency in existing buildings are calculated with the figures from WEO and combined with the findings in this study.

It is estimated that the total feasible potential for energy savings by renovation and refurbishment in most OECD countries will be around 50 % of the actual consumption. In transition economies this potential will be even larger, because of lower energy standard of the existing buildings. In fast developing countries outside OECD the feasible potentials is estimated to be larger too, but the savings in these countries will be reduced by an increase in the comfort levels both for cooling and heating.

Not all buildings will be renovated before 2030 since a full renovation cycles will take around 30 – 40 years, and a policy to demand improvement of efficiency by refurbishment would not be fully effective. The possible saving potential for these measures should therefore be estimated to be around 15 – 25 % of the consumption in the existing buildings.157
Based on the WEO 2006 and the values for 2004 this will result in possible savings on 15 – 40 EJ (15000 – 40000 PJ) or 950 Mtoe in 2030 alone if strong measures are taken for improvement of energy efficiency by refurbishment and major renovation. 17 Conclusion potentials
The potential for energy efficiency in buildings is very large both in new and in existing buildings. Over time the energy efficiency in buildings can be reduced by more than 50 % alone with measures, which are feasible already today.

Buildings have a long lifetime and it is possible and feasible to halve the consumption over a long period, but there is a need for taking action today. There is a special need to reduce consumption in new buildings and by renovation, improvement or refurbishment existing buildings, as energy efficiency in buildings is especially feasible by these actions.

Because buildings are renovated after 30 – 40 years, some existing buildings will not yet have been refurbished in 2030 and the potential to cost-effectively raise buildings’ efficiency before 2030 is smaller than the total potential. The potential for energy efficiency in 2030 is therefore estimated to 30-50 EJ (30000 – 50000 PJ) per year in 2030 or 700 – 1200 Mtoe by initiatives addressing new buildings and improvements by refurbishment and major renovation.158
These cost efficient potentials will continue increase also after 2030 because there will still be need for improvements by refurbishment and because new buildings will continue to be

156 For instance estimates Danish Energy Authority a saving potential on heating on 48 %. Technical report for action plan. EDF estimates that France could reduce heat consumption with 55 % trough feasible improvements by renovation and that a best possible technology would be able to reduce consumption by 70 %. D.Osso, H.Bouia, P.Mandrou, MH.Laurent, paper for ECEEE 2007 (European Council for Energy efficient Economy). 157 Further work and studies for existing buildings will go on in the continuation of the work on Gleneagles Plan of Action. The results will be published in an end use assessment of buildings in 2008. 158 The potentials named in this study are larger than the estimates used in the WEO 2006 alternative policy scenario, but smaller than the potentials documented in Energy Technology Perspectives. 1747 of 2287
80 constructed. Similar will the limits for feasible improvements continue to increase because of new technologies, improved solutions and cost reductions.

To obtain these large potentials there is a need to take actions right now and to set up a package of policies and initiatives to improve the efficiency in buildings. These policies have to address al major barriers and there is need to set emphasis on both highly efficient buildings as for increasing the efficiency in the least effective new buildings as to set up strategies for development and demonstration.159

A package of recommendation is set up for these policies. 18 Recommendations
To realise the large potential for energy conservation in new and existing buildings, governments must surmount the barriers to energy efficiency in the building sector.

Policies and measures to improve buildings’ efficiency include:

All governments, states or regions should set, enforce and regularly update requirements for energy efficiency in new buildings. These requirements can appear independently or within building codes. Requirements for efficiency should be based on least costs over 30 years.

Energy efficiency in new buildings is a very efficient way to obtain savings, but many barriers work against energy efficiency. Building codes is a way to ensure and increase the energy efficiency in the vast majority of new buildings and can ensure a certain minimum standard in the buildings. Standards can be set either in building codes or as a specific standard for efficiency and they can be set on a national or a federal state level.

Buildings codes should reflect the least cost over time and not just the incremental costs for the buildings. Since the technology and the economy changes fast there is a need for regularly update of the standards.

Best practice and demonstration buildings such as Passive Houses and Zero Energy Buildings should be encouraged and supported to help these buildings penetrate the market. National target should beset to ensure that these buildings will really present at the market for new buildings in 2020.

Passive Houses (buildings that use so little energy that no heating or cooling system is needed) are in many areas a feasible alternative to traditional buildings, but many barriers work against these buildings. They need support to penetrate the market and become a real option for the general market. Zero energy buildings (buildings that use no energy over a year) are becoming more and more economic cost effective, but are still a more expensive solution than traditional buildings also seen over time. Support, demonstration projects, research and development is needed to mature this option and to bring these buildings in the market.

Passive Houses and Zero Energy Buildings should be the target for future buildings codes. A path should be set up to reach this target no later than 2030.

On the longer term only passive houses and zero energy buildings will be a sustainable solution. Passive houses or even Zero Energy Buildings should be set as a target for future building codes or energy efficiency standards to send a message to the market and to ensure the development of good solutions.

Financial restrains for new buildings preventing energy efficiency should be removed to ensure that buildings can be cost optimized over 30 years.

159 Future IEA analysis of energy efficiency in existing buildings will offer further recommendations. 1748 of 2287
81 Financial barriers and maximum loans can be a barrier for increased efficiency. Information activities should be targeted on the increase of the understanding of energy efficiency and the cost benefits by these institutions.

Energy demands should be set by major renovation and refurbishment of all buildings, no matter the size, type of use or ownership of these buildings.

Energy efficiency by major renovation and refurbishment is a feasible possibility to increase the energy efficiency of existing buildings substantially. Building codes or standards for energy efficiency in buildings should include demands for energy efficiency of the whole buildings by major renovation or refurbishment and the codes should include efficiency demands for the individual components on installations by replacement.

Energy efficiency for buildings should be made visible in the market place to give building owners a real choice. This could be by certification, labelling or other declaration of energy consumption.

There is too little emphasis on energy efficiency by the purchase of buildings although the energy costs can be a substantial part of the costs in the new building. Efficiency of buildings and life costs are difficult to understand for the ordinary buyer. Efficiency of new buildings and especially the efficiency of buildings, which are better than the minimum energy efficiency requirements in the building regulation should be increased for instance by stars, by labelling schemes or by certification of buildings. These schemes should be reliable and need to be controlled by governments or other public authorities.

Governments should lead by example and make new governmental buildings optimized for life costs over a 30 years time or for the whole life time of the building.

New public buildings and in particular buildings owned by the state should show a good example for the citizens and the companies. In particular public buildings should therefore be built based on a life time approach making these buildings a least as energy efficient and cost effective as possible over lifetime. Public building could even be used for demonstration to facilitate the development of even more efficient buildings. Governments should be the first to build to passive house standards or to construct zero energy or zero carbon buildings.

Governments should set up a package of initiative to address the barriers for energy efficiency in both new and existing buildings including the mentioned recommendations above.

Since there are many barriers that work against energy efficient buildings both for new and for existing buildings, there is a need for different initiatives to remove these barriers.

Governments should study the efficiency in buildings and determine the most important barriers, which work against efficiency in buildings, and then set up a package of policies to remove the most important of these barriers as well for new buildings as for existing buildings.

Special outreach activities should be taken for the fast developing countries such as China and India where most of the world’s new buildings are constructed.

Most of the new buildings are constructed in the fast developing countries and especially in China and India. The largest potentials for savings in new buildings are therefore in these regions. At the same time new supply systems are needed in these countries, which make energy savings in buildings even more feasible from a national economy. Special activities should be taken to ensure that buildings in the fast developing countries are as efficient as possible and that new technologies, Passive Houses and Zero Carbon Buildings are introduced.
1749 of 2287
82 Further R&D (Research and Development) should be undertaken in buildings including R&D in development and intelligent design of highly energy efficient buildings.

Although the energy potentials are huge in with measures which already exist and are feasible even today, then this potential could be increased further by research and development. If the potentials for zero energy or even plus energy houses can be unlocked, the total potential in the building sector will increase substantial over the longer term. 1750 of 2287
83 19 References:

19.1 Publications
ASRHAE/IESNA Standards 90.1-2004, ASRHEA Standard - Energy Standards for Buildings except Low-Rise Residential Buildings. American Society of Heating Refrigerating and Airconditioning Engineers, Inc.

IECC 2004, International Energy Conservation Code 2004. Energy standard for Low-Rise Residential Buildings set by the International Code Council, ICC.

IEBC, International Buildings Code for Existing Buildings, International building code for energy efficiency in existing buildings set by ICC, International Code Council.

ECOFYS for EURIMA & EUROACE, Mitigation of CO2 Emissions from the Buildings Stock, Beyond the EU Directive on Energy performance of Buildings, DM 797.

ECOFYS for EURIMA, Cost-Effective Climate Protection in the EU Building Stock, DM 70068.

ECOFYS for EURIMA, Cost-Effective Climate Protection in the EU Building Stock of the New EU Member States, Beyond the EU Directive on Energy performance of Buildings, DM 70067.

ECOFYS for EURIMA, Sensitivity Analyses of Cost Effective Climate Protection in the EU building Stock, June 2006.

ECOFYS for EURIMA, U-values for better Energy Performance of Buildings September 2007.

IEA EUROACE, Energy Efficiency in High-rise Buildings 2006.

IEA, Paul Waide, Light’s Labour’s Lost, Policies for Energy-Efficient Lighting 2006.

SBI Statens Byggeforsknings Institut in Denmark, SBI, Ole Michael Jensen, Barrierer for realisering af energi besparelser i bygninger. 2004.

Frauenhofer Institute Solar Energy Systems, The Solar House in Freiburg, from a selfsufficient solar house to a research platform. August 2000.

CEPHEUS project on Cost Effective Passive Houses as European Standard, Final Report July 2001.

Krapmeier Drösler, CEPHEUS Living Comfort Without Heating, Austria 2001.

European Union, Green Paper of 29 November 2000 "Towards a European strategy for the security of energy supply".

UK department for Communities and local Government. Building A Greener Future: Towards Zero Carbon Development, December 2006.

Ministry of Transportation and Energy, Denmark, Action Plan for a Renewed Energy Conservation Policy, (Handlingsplan for en fornyet energispareindsats, Energibesparelser og Marked), 2005.

Danish Energy Authority, Technical Report Action Plan for a Renewed Energy Conservation Policy, Energy Conservation and Markets (Faglig baggrundsrapport. Handlingsplan for en fornyet indsats, Energibesparelser og marked), 2004.

Passive House Institute, Energy Efficiency, (Energieeffizientz), Dr. Wolfgang Feist, Heidelberg 2001.

Swedisol, Insulation Guide Buildings 06 (Isolerguiden Bygg 06), 2006.

IEA, Energy Technology Policy Perspectives, Scenarios & Strategies to 2050, IEA 2006.

European Union, Directive 2002/91/EC of the European Parliament and of the Council of 16 December 2002 on Energy Performance in Buildings.
1751 of 2287
84 European, Union Directive 2005/32/EC on the Eco-design of Energy-using Products.

LBNL, Joe Huang for the Asian Business Council, Energy Efficiency Buildings Standards in China, 2006.

Japan, Law Concerning the Rational Use of Energy, revised in June 1998.

Ministry of Power India, Proposal for Energy Efficiency Building Code for India, Bureau of Energy Efficiency, 2006.

COBRA 2006, The Construction and building research conference of the Royal Institution of Chartered Surveyors, 7-8 September 2006..

ICF Consulting International, Building a Path Towards Zero Energy Homes with Energy Efficiency Upgrade. Dean Camble, Brian Dean and David Meiesegeier. ACEEE 2006.

ICF Consulting International, Review and Economic Analysis of Increased Wall Insulation Required by the 2004 IECC Supplement. 2004.

IEA, Philippine de T'Serclaes, Financing Energy Efficient Homes: Existing policy responses to financial barriers, February 2007.

Conservation Bureau of the Ontario Power Authority, the Power of Building Better, Increasing the Energy Efficiency Requirements of the Ontario Building Code to Create a Culture of Conservation, 2006.

Climatography of the United States No. 81, Annual Degree Days to Selected Bases 1971- 2000, National Oceanic and Atmosphere Administration, June 2002.

Building Regulations for Windows in European Countries, ENPER project.

19.2 Web Pages
http://www.buildingsplatform.org/cms/ Homepage on the Energy Performance in Buildings Directive supported by the European Commission.
http://europa.eu/scadplus/leg/en/s14000.htm#EFFICACITÉ European Union homepage on Energy Regulation and Initiatives.
http://www.eurima.org/index_en.cfm EURIMA, the European Association of Insulation Manufacturers.
http://www.euroace.org/ EUROACE, the European Alliance of Companies for Energy Efficiency in Buildings
http://www.energycodes.gov/implement/state_codes/ DOE homepage is giving a good picture of the implementation in the individual state
http://www.bsc.ca.gov/ Homepage for the California Building Standard Commission. http://www.naima.org/ NAIMA, North American Insulation Manufactorrs Association, http://en.wikipedia.org/wiki/U_value Homepage with simple information on values and units used for energy efficiency in the building envelope. http://www.ise.fraunhofer.de/english/publications/brochures_productinfos/gf1/pdf/The_ Solar_House.pdf, Frauenhofer institute, Brochure on Zero Energy Solar Building http://www.osti.gov/energycitations/ US document and legislation database http://www.euleb.info/ Information on the project EULEB, European High Quality Low Energy Buildings, project supported by the European Commission. 1752 of 2287
85 http://www.epbd-ca.org/ Information on the Concerted Action EPBD project. http://www.passiv.de/ Passiv Hause Institute, Passive House Institute, Research and development of high-efficiency energy systems.
http://www.usgbc.org/ USGBC, U.S. Green Building Councils homepage including definitions of LEED buildings.
http://www.mah.gov.on.ca/userfiles/HTML/nts_1_27487_1.html, information page on the energy efficiency demands in building codes in Ontario. http://www.worldclimate.com, information on climate for the world. 1753 of 2287
Via Email
March 10, 2022
Vilia Zemaitaitis
Community Development Department
Planning Division Office
633 East Broadway, Room 103
Glendale, CA 91206
Email: [email protected]
Re: Comment on Sustainable Communities Environmental Assessment (SCEA) Lucia Park Project (620 N. Brand Boulevard and 625 N. Maryland Avenue) Dear Principal Planner Zemaitaitis:

I am writing on behalf of the Supporters’ Alliance for Environmental Responsibility (“SAFER”) concerning the Sustainable Communities Environmental Assessment (“SCEA”) prepared for the Lucia Park Project (“Project”) located at 620 N. Brand Boulevard and 625 N.

Maryland Avenue in the City of Glendale (“City”).

After reviewing the SCEA with the assistance of Certified Industrial Hygienist, Francis “Bud” Offermann, PE, CIH, and air quality experts Matt Hagemann, P.G., C.Hg., and Paul E.

Rosenfeld, Ph.D., of the Soil/Water/Air Protection Enterprise (“SWAPE”), SAFER requests that the the City revise the SCEA prior to approval of the Project because (1) the SCEA fails to incorporate all feasible mitigation measures from prior environmental impact reports and (2) the SCEA’s conclusions about the Project’s impacts to air quality are not supported by substantial evidence.

PROJECT DESCRIPTION
The Lucia Park Project proposes the development of a residential apartment building on a 63,760-square-foot site, currently developed with a two-story office building and the six-story Chase Bank office building and an associated parking structure. The Project includes the demolition of the existing parking structure and two-story office building and construction of a 24-story, 294-unit residential building containing 247 one-bedroom and 47 two-bedroom apartments, with a parking garage containing 502 parking spaces, including 373 parking spaces for the proposed apartments in four levels of subterranean parking and two above-ground levels. 1-1
1-2
Responses to Comments
Comment Letter No. 1
Lucia Park Project
Sustainable Communities Environmental Assessment
City of Glendale
March 2022
EXHIBIT 6B
Responses to Comments
1754 of 2287
SAFER Comment
Lucia Park Project - SCEA
March 9, 2022

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Glendale City CouncilJune 14, 2022

Glendale City Council
June 14, 2022