California Forging Ahead on Zero Emission Buildings

The California Energy Commission (CEC) took a major stride toward zero-carbon emissions buildings in the 2022 update of the statewide building energy code that will require new buildings to use less energy and cut carbon pollution.

Children play in the courtyard of MidPen's first all-electric affordable housing project with David Baker Architects: Edwina Benner Plaza in Sunnyvale, California.

Credit: Bruce Damonte

12/14/2021: The California Building Standards Commission voted unanimously today to confirm the 2022 update of the state’s building energy efficiency standards, as adopted by the California Energy Commission in August earlier this year. They become effective January 1, 2023.

Hopeful climate news came from Sacramento, CA today as the California Energy Commission (CEC) took a major stride toward zero-carbon emissions buildings in the 2022 update of the statewide building energy code it just adopted. Energy use in buildings is responsible for a quarter of California’s climate pollution, and seven times more toxic nitrogen oxide air pollution than all the state’s power plants.


CEC’s new code follows the lead of the 48 California Cities and Counties that have so far adopted local building energy codes that transition new homes and other buildings off fossil fuels. The state building code sets energy requirements such as minimum efficiency of walls, windows, and heating and cooling equipment, for both new and existing buildings. It is updated every three years. This code update focuses primarily on new construction. Starting January 1, 2023, it will require that new buildings use less energy and cut carbon pollution, in part by transitioning away from fossil fuels.

After its groundbreaking 2019 update that set requirements for rooftop photovoltaic solar panels for most new single-family homes, the 2022 update is taking the next step toward zero-emission new construction by tackling pollution from fossil fuels burnt for heating and hot water in buildings, and the associated fugitive emissions of methane, a potent climate pollutant that leaks from wells, pipelines, and homes, turbo-charging the climate crisis.

Keeping homes and other buildings warm in the winter and supplying hot water for showers and other domestic uses is currently responsible for the majority of energy use and climate pollution in buildings. Gradually switching from fossil fuels to clean super-efficient electric heating and hot water, known as building electrification, is the most realistic and least cost pathway to buildings than run on clean energy. The “renewable” gas pipe dream that vested industrial interests are promoting is needed to help decarbonize industrial uses of methane and hydrogen, but there isn’t enough of it for all sectors, and it would cost many times more than thoughtful electrification in buildings.

Biggest Changes in the 2022 Code

The biggest climate win in the 2022 code update is the shift to electric heat pump space and water heating: powering space and water heating with electricity that is already a lot cleaner than gas and will eventually be carbon-free offers a pathway to zero-emission buildings. An efficient heat pump will save at least 75% of greenhouse gas emissions over its life in California, compared with the most efficient gas furnace available, and probably more as the state accelerates its progress toward zero-carbon electricity. The electric space and water heating incentives apply to all residential buildings, whether single-family or apartment buildings of any size, and to select heating systems in non-residential buildings. More work is needed to expand those requirements to other types of heating systems used in larger non-residential buildings.


graph showing GWP20 emission reductions by region

Source: NRDC based on UC Davis, Western Energy Cooling Center’s study “Greenhouse gas emission forecasts for electrification of space heating in residential homes in the United States.”

The 2022 code update also includes significant energy efficiency improvements, particularly through non-residential building envelope, fan, and lighting efficiency requirements, a consolidated multifamily set of requirements that will facilitate future efficiency improvements, and residential alteration and addition improvements.

Finally, the 2022 code extends the 2019 rooftop solar requirements from new single-family and low-rise residential apartments to solar and storage in new multifamily and non-residential buildings. The solar and storage requirements are modest, but very cost-effective for the building occupant, saving far more over their lifetime than they cost upfront. They will result in buildings that are more resilient to power outages and can reduce their use of grid electricity at peak times when electricity is scarce, expensive, and dirty. Together, these changes will save Californians $1.5 billion in costs, and 10 million metric tons of greenhouse gas emissions over the 30-year life of the buildings, per CEC estimates.

Why California’s Building Code Matters

The significance of this code update shouldn’t be underestimated: there are more than 100,000 new housing units, and more than 100 million square feet of non-residential offices, retail, and other non-residential buildings built every year in California. Every new building needs new heating, cooling, and hot water equipment, whereas furnaces and water heaters only get replaced once every 15 to 20 years in existing buildings. New construction therefore commands a significant share of the equipment market. The shift of new construction to electric heat and hot water will also reduce the cost of heat pump equipment used to retrofit existing buildings and will build the workforce needed to decarbonize existing buildings over the next decade.

California’s shift to zero-emission new construction will also have repercussions far beyond the state’s borders: most of new construction over the next several decades will take place in Asia and Africa, in countries that are developing or strengthening their own building energy codes. They often look at California and other climate leaders for inspiration, so we can expect California’s policy to have global impacts.

In the United States, states and cities also have the ability to adopt their own building energy code. NRDC partnered with the New Buildings Institute to develop a building decarbonization model stretch code that helps states and cities accelerate their own transition off fossil fuels.

How the New Code Works

California’s new code isn’t a mandate, it is technology-neutral and performance-based. It doesn’t require homes to be solar-powered and all-electric, but strongly encourages the solutions that have the lower energy costs and carbon emissions, while also discouraging but not preventing continued use of higher-energy and emissions fossil-fueled heating and hot water.

The code does this by providing compliance credits and penalties based on both the energy efficiency and the carbon emissions of the building. If builders choose high-efficiency electric water or space heating instead of gas furnaces and water heaters, they don’t have to make any other energy efficiency upgrades to the rest of the building compared to the current code. If they use gas for both space and water heating, they have to offset the higher energy use and carbon emissions of gas appliances by including other energy efficiency measures such as more insulation or better windows. If they use heat pumps for both space and water heating, they get compliance credits and can avoid some of the more costly energy efficiency measures, while still slashing carbon emissions and occupants’ utility bills.

This incentive approach will give builders a strong financial encouragement to transition off fossil fuels, while leaving them implementation flexibility for adjusting their internal processes such as training their workforce and evolving their marketing practices. NRDC expects that together with complementary financial incentives to encourage early adoption and speed up market ramp-up, this approach will lead to the vast majority of the new residential construction in the state to be mostly- or all-electric starting 2023.

Cookstoves, fireplaces, and clothes dryers which currently often use gas, are not regulated by the building code, so builders can continue to include them and customers to choose them if they don’t feel ready to use the better electric options such as induction stoves that are faster, more controllable, safer, and healthier. But going all-electric avoids connecting the building to the gas line in the street, which can save thousands of dollars in construction costs, so there again the code will provide a strong financial incentive for builders to choose the electric options.

Saving Money

The new code isn’t just going to help move away from fossil fuel pollution in our homes and other buildings, it is also going to help with housing affordability, in several ways: first, all-electric new buildings don’t need to be connected to gas pipelines, saving thousands of dollars in construction costs. Also, most new buildings are now built with solar photovoltaic panels, which means that electric heating and hot water can be powered by low-cost solar energy, which costs a lot less than utility gas, saving on heating and hot water bills.

California’s 2022 code is a major stride on the path to a healthier, more affordable, zero-emission building sector, which is particularly welcome after climate scientists’ latest report that makes crystal clear that policymakers everywhere must take decisive action to reign in the climate crisis. But there is a long way to go to achieve zero-emission across all buildings by 2050. California’s next priorities should include going all the way to zero-emission new construction across all building types in the 2025 code update; and beginning to invest in the decarbonization of existing buildings, with a priority for residents experiencing rent and energy burden as those are often the most impacted by pollution and the costs of fossil fuels.


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