The Real Climate Impact of California’s Buildings

Credit: Author calculations.

This post has been edited to provide an example of on-site building emissions.

California is reeling from the impacts of climate change this summer, fresh on the heels of the hottest month on record and grappling with wildfires burning up and down the state—including the largest in the state’s history. To lead the global response required to slow and reverse these dire trends, California has set ambitious statewide greenhouse gas emission limits, which will require rapid decarbonization across every major sector of the economy—including millions of buildings.

A new analysis by NRDC finds that the share of emissions California buildings are responsible for is twice as high as the official estimate.

This is important because as the old axiom holds, you only manage what you can measure; and you can only manage effectively what you measure accurately. When it comes to the pace and scale of change required to slash emissions in California’s building stock, the numbers aren’t telling the whole story.

Demand Drives Emissions  

The discrepancy is a result of two factors.

First, the official carbon inventory lumps the building sector’s emissions from electricity consumption into a general “electricity” category. While that’s useful for tracking the state’s progress on renewable electricity, it can be misleading when thinking about the emissions impact of sectors that actually use the electricity. After all, electricity is not generated for its own sake; it’s used to power our homes, businesses, and, increasingly, our vehicles. To correct this imbalance, we reallocated the electricity sector’s emissions to each end-use sector rather than lumping them together.

Second, the production and distribution of natural gas results in some amount of gas that is lost to the atmosphere through leaks. While the inventory includes leaks from natural gas produced in-state, it excludes leaks from the vast quantity of natural gas that California imports from other states (which accounts for about 90 percent of the state’s consumption, according to the U.S. Energy Information Administration). To fill this gap, we added estimates of out-of-state gas leaks to the inventory, because, as with electricity, those emissions result from gas that is produced and transported to meet demand in California’s buildings.

After accounting for these issues, our analysis of California’s latest greenhouse gas inventory, which the California Air Resources Board (ARB) releases every year and currently contains data through 2016, reveals that the emissions attributable to the building sector are around 25 percent of total state emissions, or more than double ARB’s reported share of 12 percent. About two-thirds are from on-site fuel use such as gas and propane, and one-third is from electricity usage, when using a 20-year global warming potential (GWP).

Excluding emissions from electricity and from out-of-state methane leaks means we are not getting the whole picture when it comes to the emissions associated with the energy powering California’s homes and businesses.


Credit: Author calculations.

(For more details on the methodology, see the explanation at the bottom.)

Why It Matters

While ARB’s greenhouse gas inventory is an essential tool for policymakers, NRDC’s analysis shows that there is room to make it more effective. ARB should make it easier to view emissions according to end-use sectors, and not just in a lumped-together supply-side sector like “electricity.” They should also present results with both a 100-year and 20-year GWP to highlight the importance of strong climate action in both the near- and long-term.

California policymakers need the right data to develop policies that will achieve the state’s clean energy goals most cost-effectively. This includes assessing the potential to reduce building GHGs in line with the state’s economywide reduction goals (40 percent below 1990 levels by 2030) as directed by Assembly Bill 3232 (Friedman), incentivizing innovation for new buildings to be zero-net emissions, and growing the market for clean heating equipment like super-efficient heat pumps so they are more accessible and affordable for all Californians, as directed by Senate Bill 1477 (Stern). These two bills were signed by Governor Brown on September 13, 2018, as part of a package of bills intended to accelerate California’s progress toward its climate goals.

Finally, California also needs to reduce emissions from its existing building stock, which is responsible for the majority of the sector’s energy use and carbon emissions. Less than 1 percent of California’s building stock is from new construction in a given year, which means that most of the buildings that will be standing in 2050 have already been built. Deep retrofits are needed to ensure that existing buildings can benefit from the knowledge and technology that have developed after their construction. This starts by updating outdated regulatory barriers to cost-effective decarbonization programs (including some current California Public Utility Commission policies) that currently impede incentive programs that reduce energy use and emissions through a switch to efficient and increasingly clean electric technologies.

While California is leading the world on low-carbon electricity and cars, it now needs to lead on the next frontier of its clean energy vision: decarbonizing its buildings. The good news is, California seems to have gotten the message—the Governor also signed Assembly Bill 2195 (Chau), which requires ARB to track and report the kinds of out-of-state emissions we analyzed.

Details on Methodology

To address the issues we identified with the inventory we first reallocated the emissions attributed to the electricity sector using electricity consumption data. We used a similar strategy for upstream natural gas leaks. We calculated the amount of natural gas imported into California, which is approximately 90 percent of the total amount consumed in the state. Then, using the estimated average leak rate of 2.3 percent recently published by the Environmental Defense Fund in a study in Science, we calculated the amount of natural gas that would be directly emitted to the atmosphere as a result of leaks. Next, we proportionally allocated these to end-use sectors based on the percentage of California’s natural gas that they consumed. (Some of this was attributed to the electricity sector, which was subsequently reallocated to the end-use sectors as described above.)

We examined the resulting modified inventory using both a 100- year and 20-year GWP. We used two GWPs because no one number provides the entire story. Hundred-year GWPs are essential for understanding long-term climate impacts, but it can be difficult to see more immediate threats. Twenty-year GWPs give greater visibility to these more immediate threats that could potentially push the planet past important “tipping points,” but can make it harder to assess longer-term climate impacts. (For example, the transportation sector has a higher share of Carbon dioxide CO2-equivalent emissions with a 100-year GWP than with a 20-year GWP.) Using either GWP, the building sector’s true share of emissions is around 25%. However, a 20-year GWP increases the sector’s CO2-equivalent emissions by close to 50%, as shown in the second chart above.

Our analysis does not include emissions embodied in building materials such as cement, steel, and glass. These emissions are significant and represent real emissions upstream in the building supply chain, whether at the cement factory or the steel mill. These emissions also need to be minimized to reduce global climate emissions and pollution.

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