In this episode, Huffington Post reporter Alexander Kaufman traces the recent history of US building codes, a surprisingly compelling and twisty tale of efforts at reform meeting stiff resistance from builders and natural gas companies.
Text transcript:
David Roberts
Not many people outside the industry have been paying attention, but over the last five years there has been a struggle playing out behind the scenes over building codes: the basic rules and guidelines that govern how commercial and residential buildings are constructed in the US.
Perhaps the term “building codes” does not set your heart aflame. But it turns out they are extremely important. Small changes in code — for instance, measures that tighten efficiency standards — can, when multiplied over millions of new buildings, save enormous amounts of energy and prevent substantial greenhouse gas emissions.
In recent years there have been efforts to update the codes in ways that would encourage efficiency, which aroused opposition from the homebuilder groups, and encourage electrification, which aroused opposition from the natural gas industry. But these battles are taking place behind a haze of rule changes and code committees and other bureaucratic details that obscure their significance.
Luckily, HuffPost reporter Alexander Kaufman has been paying attention. He's been following this story, relentlessly and almost alone in the popular press, since 2019. I invited him on the pod to talk about who develops these codes, who influences their direction, what legal force they do or don’t have, and what role Biden plays in their wide-scale implementation. It's a surprisingly twisty and compelling tale. I hope you enjoy.
All right then. Alex Kaufman of HuffPost and other media exploits. Welcome to Volts. Thank you so much for coming.
Alexander Kaufman
Thank you so much for having me. Longtime listener, first-time caller.
David Roberts
So, Alex, you have been a lonely voice in the wilderness following this story about building standards for three or four years now. And it's funny, I was sort of googling around in preparation for this. It's just not — you are almost alone in tracking this story.
Alexander Kaufman
There's been some great trade reporting on this stuff, so I want to give my — tip my hat to them as well.
David Roberts
Yeah. Most of the reporting has been buried in trade journals, but I think this is a really significant climate story and clean energy story. It's an interesting industry story. I just think it's an interesting story, all the sort of Machiavellian to and fro in the background. So I thought I would just have you on to tell this story, share this story with our listeners. So I think by way of starting, maybe just tell us, what the heck are these building standards? Who develops them and what is their legal force?
Alexander Kaufman
So, building codes —
David Roberts
Building codes, yes. Sorry.
Alexander Kaufman
And I'll note that it's a code because the language of standard will come into play.
David Roberts
Okay, building codes.
Alexander Kaufman
But building codes — we don't in the United States have a national building code. The federal government does not provide one. The federal government has certain powers that help to dictate how these are adopted. But over many years, with different organizations setting different codes, this all became consolidated in the 1990s under primarily one organization called the International Code Council. And to crib a line that a friend of mine once used when writing about this in The Guardian: much like the World Series, it is called international; it does apply to a select few other countries, but it primarily covers the United States.
David Roberts
And we should say just building codes, I mean, it's too obvious to point out, but this is just sort of like minimum requirements, if you're building a building in terms of, like, insulation and wiring, plumbing, things like that,
Alexander Kaufman
Everything. How big your pool is supposed to be, how thick your insulation needs to be, what kinds of windows are up to snuff to actually keep you from losing energy. So they began to develop these codes in the early 1990s under the ICC, not to be mistaken, with the International Criminal Court.
David Roberts
The International Code Council, is that right?
Alexander Kaufman
Yes. And so the International Code Council puts out these different codes, some for commercial buildings, some for residential buildings. And every three years, they would bring together experts from across the industry, different trade associations, representing utilities, representing home builders, representing appliance manufacturers, with some environmentalists, and with primarily actual government employees, the people who are enforcing these things, the building inspectors, the sustainability officers, the people who are, at the end of the day, tasked with adopting and implementing these very measures.
David Roberts
Right.
Alexander Kaufman
And so they would duke it out over a months-long process and figure out how they should update the code for the next round, for the model code that gets used across the country. And at the end of that process, only the government members would have the right to vote on the final code. And so despite the fact that the ICC is this nonprofit consortium — it's obviously not a governmental organization — that sort of gave it this democratic imprimatur.
David Roberts
So the industry reps and the appliance manufacturers, et cetera, don't get a vote. It's just the government employees who did — at the time — got to vote. And was this just like an up and down thing, or is this voting in and out individual things?
Alexander Kaufman
There are different processes that went into the final vote. There could be some horse trading in the process that would lead to a final vote. But the final, final vote on "this gets in" or "this does not get in" would only come down to the governmental members. And so the industry reps and the environmentalists and the architects would have the ability to negotiate before that final vote and to propose things before that final vote. But the final vote would come down to the government members, and this sort of gave it, again, that kind of democratic legitimacy, because these are representatives of elected governments.
These are the people enforcing the actual code, and these are the people who get final say over what makes it into that model code.
David Roberts
Right. And then once the code was done every three years, then it basically is issued, and state and local governments can choose to adopt it or not. Or adopt some parts of it or not. It is in no way binding. It is something that states and cities can choose to accept or not, correct?
Alexander Kaufman
That is correct. So different states and different cities have different laws that require adoption. So, for example, Illinois tends to be one of the most progressive or ambitious when it comes to these codes. Their state law adopts the code statewide and requires that the state adopt the latest code, or at least consider and then likely adopt the latest code each time it is issued every three years. On the other end of the spectrum, another "I" state is Idaho, which has had a very antiquated system and a very laissez-faire system when it came to this kind of development — which is not surprising in a pretty sparsely populated state.
David Roberts
And they're still laboring away with, what is it, the 2009 standards there?
Alexander Kaufman
That's correct. So, there was a federal law that passed in 2007 that essentially helped to enshrine the ICC code as part of an overall federal standard, and that kind of raised all boats to the 2009 standard.
David Roberts
So that was the last time states had to do anything. And therefore, it was the last time some states did anything.
Alexander Kaufman
That's correct.
David Roberts
Okay, so you have this process where industry reps, et cetera, government employees hash it out, final vote from government employees. They adopt a code. This was the process, 2009 to 2015. And what I take from your reporting is that up through 2019, this was a relatively sleepy process that did not really dramatically tighten codes.
Alexander Kaufman
That's correct. So, for more than a decade, each time that they would come together for an update, they would debate different things, but ultimately decide on a code that increased the energy efficiency of the code by about 1%. And I should specify here that while the ICC codes are covering a wide range of things, from plumbing to pools to roofing, what we are discussing here is a specific code, the IECC, the International Energy Code. And you can imagine given — this became a big issue, the ICC was not around at that time, but this became a big issue starting in the 1970s with the energy crisis and a new focus on energy efficiency. And in more recent years, it's had a climate urgency around these updates.
David Roberts
So relatively small increments of progress in the energy code part of the building codes through 2019. And then in 2019, something fairly remarkable happened. So tell us that story.
Alexander Kaufman
Well, so it really goes back to 2018, which your listeners won't need to be reminded of the big UN IPCC report that came out that year, and a lot of the local legislative reaction to that report where suddenly a lot of these different jurisdictions across the country started realizing, "Okay, we need to do something about climate change. We have to cut emissions." And there isn't that much that a town or a county or even a city as big as New York can do. You don't have jurisdiction over what kinds of power plants are ultimately feeding electricity into the city.
That tends to be a state decision. You don't have power to dictate exactly what kinds of vehicles are on your road. There's some limited ability to affect that. But you can't just ban all internal combustion engine cars. So there's not much that you can do around that. What they do control are what kinds of buildings are built in their jurisdictions. So they realized then, "Wow, we have this huge amount of power and influence that we could have over these codes. Individually none of us are equipped to write the codes on our own — that's the whole reason that an organization like the ICC exists in the first place.
But we can come together around these shared goals and make sure that when we vote, we vote for the greenest and most efficient possible code that we can get." And that's exactly what they did. So in 2019, they organized themselves. There were some outside nonprofits that were helping to organize that, including Michael Bloomberg's US Conference of Mayors. Groups like ACEEE, the big energy efficiency advocates.
David Roberts
Yeah, yeah. And these are mayors, city managers, just city officials in general who get to vote?
Alexander Kaufman
So this is another thing that changed. They expanded. Prior to 2019, groups like the National Association of Home Builders, one of the bigger and more influential organizations within the ICC, were complaining that there was such low voter turnout each round that they weren't getting codes that were representative of what people wanted and needed.
David Roberts
Careful what you wish for, right?
Alexander Kaufman
Right. So they switched to online voting. The cities recognized what kind of unique power they had through this organization and through this unique right to vote, and they ended up organizing for a very climate-friendly vote and had bigger turnout than ever before. It was a historic level of turnout, and that's because when they looked at the bylaws, they realized, okay, it wasn't just building inspectors who would qualify for this, but sustainability officers, a relatively new type of position in a lot of municipal governments. But they were relevant to this because they were helping to oversee codes. Different kinds of safety officers within the buildings departments, they could also qualify.
And different cities and counties based on their size were allotted different potential numbers of voters. And for the first time, a lot of these cities felt a real imperative around getting their employees to volunteer their time to participate in this process so that the city could see its efficiency goals realized.
David Roberts
So the cities organized, along with activists. I mean, the industry line here is," oh, this was an activist campaign taking over the process," which they say negatively. But, yeah, it was. It was a good one. And so the cities organized, kind of flooded the vote, voted for super tight energy standards, and that is what we're getting in the 2021 official building codes. Yes, the good codes that the city managers voted for.
Alexander Kaufman
That's right. And after multiple years of the energy codes only increasing efficiency by about 1% each round, this round saw gains of 10% to 14%, depending on where you were looking. So it was really a dramatic, dramatic increase in the efficiency. And it was a dramatic increase in the efficiency despite the fact that the backlash that ultimately came to this from industry got some of the more ambitious electrification measures stripped out of the main code.
David Roberts
And we say stripped out: Moved to the appendix.
Alexander Kaufman
Moved to the appendix. That's right.
David Roberts
A fate worse than death.
Alexander Kaufman
So there is the base code, right, that gets adopted as the official IECC. And then there is an appendix, basically some bonus codes and add ons for the Seattle's and the Minneapolis's and the New York's of the world that want to go a little bit beyond what they've set as the national standard.
David Roberts
But like the Illinois, which is statutorily required to adopt the code, does not have to adopt all the things in the appendix, right. It's sort of not part.
Alexander Kaufman
And for what it's worth, Illinois, while statutorily required to consider and generally biased toward adopting the latest code, does not have to adopt the whole IECC, whole cloth, either. Illinois has the right within its own bureaucracy to decide if one or two things did not work, that they wouldn't have to adopt those things fully. But it's true, Illinois generally does adopt the full IECC. And if it wants to go beyond that, or say, if a city like Chicago wants to have additional measures for setting requirements for solar panels or for electric car charging, then that appendix provides some type of standard that they can look to.
David Roberts
You could dip into the appendix if you're really feeling ambitious. So this is to a sleepy and somewhat stayed, I think, organization and process, this amounted to quite a revolution. And so when we say instead of a 1% increase in efficiency, a 10% increase, that's just like insulation and air sealing and stuff like that, it's just increased requirements for that kind of stuff, right?
Alexander Kaufman
That's correct.
David Roberts
And so the industry representatives involved in this process did not like this. They were not a fan of this sudden outburst of democracy, despite the fact that they were calling for greater democracy and more votes mere years earlier. Then all of a sudden, a bunch of votes came, and they decided, "You know what? Upon reflection, we don't like voting as much as we thought we did." And so there was immense backlash to this. So tell us a little bit about how the backlash played out and what the result was.
Alexander Kaufman
That's right. And while I'm not trying to draw a clear parallel between these two separate phenomena, there was, sort of happening in the background, the challenges to the 2020 election while this was all unfolding. But you saw the industry groups immediately balk at the results. And first, they said "This was totally illegitimate, and most of these government officials who registered to vote this time were ineligible to vote. They should not have been voting." And so the ICC said, "Okay, we'll go back and we'll look at the voter rolls, and we'll make some determinations about whether their votes were eligible."
And in all but maybe a single-digit handful of cases, they deemed all the votes eligible. So when that failed, they said, "Well, this process was biased and perverted the process that we had agreed to, and we want to appeal some of these things." And groups like the NAHB and the Leading Home Builders of America, two of the larger home building trade groups, challenged a series of provisions. Many of those appeals that they made to the appeals board of the ICC were not granted. However, a handful were, and those handful were appeals that were made not by the home building associations, but rather by the gas utility trade association.
David Roberts
Yeah, correct me if I'm wrong, I had to read this twice when I read your story on this; it was all and only the objections —
Alexander Kaufman
That's correct.
David Roberts
from the Natural Gas Council. So they lodged four objections. And those were the only four objections that went through, basically, which is notable.
Alexander Kaufman
That's right. You know, those were generally supported by a lot of those home builders, but the primary appellant were either the American Gas Association or the American Public Gas Association, you know, two groups representing gas utilities.
David Roberts
And was the content of those objections notable?
Alexander Kaufman
The content of those objections was notable in that it really brought to a head the climate stakes and the nature of the debate that was taking place here. So the things that they took issue with, unsurprisingly, were requirements that would make it much easier for buyers of new homes to not use gas appliances. It wasn't all about appliances. Some of them were just about having the circuitry already installed for an electric car charger. Some of them were about similar things, but for the circuitry for an electric boiler or an electric stove, any of those things.
David Roberts
So it was mainly about electrification?
Alexander Kaufman
It was mainly about electrification. That's correct.
David Roberts
Which is, as we know, as listeners know, the site of the battle right now, right. That is the fight.
Alexander Kaufman
That's exactly right. And their argument was that this is an unsettled political debate that is coming from one side, and by requiring this, we are adding thousands of dollars to the base price of any new home under the assumption that electrification is indeed the future, which they don't agree with. And notably, and I obtained an internal copy of a board of directors memo that the APGA put together for its board the year after this change was made to the IECC process, which helped to overturn those things. And they said to their board that these changes, far from — their public statements were, "Oh, this doesn't really change anything. And this is all just to preserve consumer choice." And to their board they said, "Hey, this preserves consumer choice, and that's really good for us." So it was quite clear that this was important for their bottom line.
David Roberts
Right.
Alexander Kaufman
And it's understandable, right. I mean, some news that I just saw the other week out of France is that for the first time, France is now increasing the rate for gas because they are seeing a drop in overall utility customers for those because of electrification. And this is what is always feared, right? If you don't have that captive audience of ratepayers, then the cost of maintaining that gas system will fall on a smaller and smaller number of rate payers.
David Roberts
Death spiral.
Alexander Kaufman
Exactly. And so they were obviously hoping to stem that very death spiral with this policy change.
David Roberts
So this is the gas versus electrification battle manifesting in yet another obscure bureaucratic process which matters quite a bit. They appealed some of these things, got a couple of them, bumped to the appendix, but then they did something bigger, which is like, we don't want this to happen again. We don't like this democracy thing that's happening to our process. Let's change the process. So, what was that about?
Alexander Kaufman
Well, this I have not been able to confirm, and it's only kind of circumstantial, but there isn't public evidence that those groups that opposed the results of the 2019 process, which, just to add one more layer of confusion to a listener, the 2019 process was to design the 2021 IECC code.
David Roberts
Right.
Alexander Kaufman
So the process around the 2021 code, they were displeased with it. And the ICC at the end of this process said, "Well, we're concerned that this is becoming too political and that this is going to hinder widespread adoption of the code." And notably, the ICC has an incentive to have widespread adoption of the code because the ICC makes its money selling code books. They said, how about we change this from a code writing process to what they call a standards process, and a standards process under their rules does not have that final vote at the end and instead is hashed out in, "consensus committees," where the different trade associations, the different governments and other stakeholders have equal or proportional representation.
David Roberts
Right. So, no more voting.
Alexander Kaufman
No more voting.
David Roberts
We're now in a council, and local governments still have a voice on that council, but it is a minority voice ultimately. Like, if industry sticks together, they can basically outplay the local government officials now and there's no vote at the end.
Alexander Kaufman
That's correct. And when they first proposed this, this shocked many of the people involved in this process. And I want to note that industry, I'm using industry broadly, but the industry groups involved were not uniform. Certainly the home builders and the gas associations tended to be on the same side. But you had groups like the architects associations, which really were very forward-thinking on adopting the greener codes. You also had a handful of different individual companies and industry people involved who happened to be involved in sustainable engineering and design or happened to hail from states that have a more ambitious or stricter code, and they were in support of those things.
So, it didn't fall neatly along the different categorical lines.
David Roberts
We should say that basically home builders in the gas industry versus everyone else, because some of these industry groups were outraged at these changes. A bunch of nonprofits and advocacy groups were outraged at these changes, activist groups. The Biden administration was outraged at these changes and came out publicly against them, no?
Alexander Kaufman
That's correct. Just, you know, less than two months after being inaugurated, the Department of Energy stepped in and sent a letter to the ICC saying, essentially, "Please don't do this. We know that this process works. This process has democratic legitimacy, and that will be under threat if you go through with the changes that you've proposed." And the ICC considered those things. They held some public hearings where they heard from officials from the major architect group, they heard from local mayors across the country who pleaded with them, saying, "We don't even understand why you are doing this. This process has worked out well."
David Roberts
I mean, we can, being conspiratorially minded green radicals, speculate on our own why this happened. But what was the public — what was the stated justification for this? Is there any good faith argument for doing what they did?
Alexander Kaufman
I think there is. The stated justification for it was that there had been a slowdown in the adoption of newer codes. Now, granted, the difference between 2015 and 2018 was not so vast, so perhaps there just wasn't as big of an incentive to go through the bureaucratic machinations on a local level to adopt that later code. But they warned that there was a growing gap between, particularly, some more rural states and some of the more urban and progressive states. And they feared that this — obviously was not going to go away in any way. This wasn't going to solve climate change with this one round of codes.
So they knew that this would continue. And so they felt that a fairer and a smoother way of implementing the kinds of changes that were going to be discussed and were going to come up as the years went on might be through a process like this. And I want to note that the line coming from industry groups has always been around affordability. And it's not news to anyone, I think, listening to this, that there is an affordable housing crisis in this country.
David Roberts
Indeed. And making new homes more expensive to build is like, from a strictly YIMBY point of view, generally a bad idea.
Alexander Kaufman
And so if you genuinely believe that electric cars are still years away and that electric heating is still relatively undesirable, or thinking of it, perhaps from the perspective of somebody in the state of New Jersey or the state of New York, where the electricity rates are higher than the national average, than the gas rates are, then this is something that they might see as a real problem for affordability in the long term, and they wanted to get the reins on it.
David Roberts
Right. And so advocates will say, when you make these changes, you're spending a little bit more upfront, but you save more than that on energy costs relatively quickly, so it balances out. But I don't know that we can say on a blanket level that that's true, always, everywhere.
Alexander Kaufman
That's true.
David Roberts
It's going to depend.
Alexander Kaufman
And it's not only on the energy cost. So that is true. A heat pump is more energy efficient than a furnace, so the amount of energy that each is using is not the same. So you can't do just a comparison of gas rates to electricity rates to figure out what the cost is ultimately going to be. But actually, the bigger issue around cost here is that if indeed electrification is the way of the future, then at some point any new home that is built is going to have to be equipped with the circuitry to have electric appliances and have electric cars.
David Roberts
And if you don't do it when you build the house —
Alexander Kaufman
It's orders of magnitude more expensive to do it later. And so that tends to be the argument that you hear from the advocates that, "Yeah, maybe it adds $6,000 now to the asking price of the new home, but then that saves you $30,000 or $40,000 down the road when you have to renovate the house and buy the appliances."
David Roberts
So this all comes down. It's funny how many in policy decisions, how often this comes up. It really all comes down to your expectations. Like, do you see electrification as inexorable and inevitable? And if so, it makes obvious sense to get out ahead of it, right. But of course, the last thing the gas industry wants to do is acknowledge that premise, is to agree to that premise. So they can't let anything premised on that notion go forward uncontested. So they killed voting. They have this new process now where industry, I think it's fair to say, has more influence now and a greater stake.
So because of this sort of revolt of the cities, we have good, tight, stringent building codes on record, the 2021 building codes. So are they getting around? Are states adopting them?
Alexander Kaufman
They are being adopted, and perhaps most pertinently right now, they have been assessed by federal regulators as doing precisely what they were meant to do. So the argument from the home builders was that this is making homes too unaffordable, or it doesn't work, as they say it will. And the federal law that required states like Idaho to raise their standards to the 2009 level in the first place also requires the federal government to basically go through a process, not unlike Illinois, where they are supposed to assess these codes each time they come out and then decide whether — it's the Department of Energy's job to decide whether they do indeed save energy. And then that assessment goes to the HUD (Housing and Urban Development) and also to the Veteran Affairs Department, although that's kind of a separate, there's a separate legislation for that, so it's a slightly separate process.
And there is a decision made about how that is meant to apply to the federal housing loans that support up to or beyond, I think, a sixth of new home purchases in the country. And so Obama is the only person so far who has followed this law. In 2015, he updated it to that 2009 level.
David Roberts
So the law says that the feds are supposed to take these building codes into effect and basically apply them as premises of federal loans. So in other words, if you want a federal loan for your new home, the home has to meet these building codes.
Alexander Kaufman
Correct.
David Roberts
And those federal loan standards were supposed to be updated along with the building codes from the ICC. The feds were not doing that, despite that being the law. So then Obama came along and did it in 2015, basically updated — what, the loan standards to the 2009 ICC standards?
Alexander Kaufman
Yeah.
David Roberts
And so here we come to the really interesting crux of the matter where the rubber is hitting the road today. So Biden has said he's going to follow this law, too. He's going to update federal loan standards to meet the 2021 standards. And so that would not make those codes — I'm sorry, the code/standards thing.
Alexander Kaufman
I know. Look, I teased a little bit at the beginning just because it helped to tee up the nature of the change within the ICC, but I actually think you can use them interchangeably in casual conversations.
David Roberts
Right.
So these 2021, the stringent 2021 building codes, are supposed to be incorporated now into the federal lending standards, which means you won't be able to get a federal backed loan for your new home unless the home meets these 2021 standards. That would be a big deal because lots of new homes get federal loans. This is not an obscure thing. It's not a marginal effect.
Alexander Kaufman
That's correct. And for the YIMBY listeners here, they probably know that most of the new homes that are being successfully built are not being built in states like New York and Illinois.
David Roberts
Right? Yeah. This is a hilarious irony that really comes out in your reporting, which is these, it's these progressive states, "progressive states" who sort of ostentatiously adopt these stringent, efficient building codes. But these are the very same friggin' states where you can't build anything —
Alexander Kaufman
That's correct.
David Roberts
because of the NIMBYs. So the only places where new homes are being built are in the states that are laggards, that aren't using the strict building codes. It's a real delicious irony there. So Biden is in the process of — where is that process? Are the 2021 codes applying to federal loans yet, or is that — ?
Alexander Kaufman
No, they are not. So this assessment is sort of stuck in the mire of the federal bureaucracy right now, getting passed between different agencies and between the Office of Management and Budget. And ultimately, they are actually far behind their own deadlines for implementing this. But implementing this would be a very dramatic change for the reasons that we already know. Now, it would be a less dramatic change than it would be a few years ago because there were hundreds of millions of dollars included in the Inflation Reduction Act for helping state energy offices to adopt these codes. There is a ton of federal money being directed at states to help them get to this point, and that money doesn't need to go to Illinois.
So that money is generally like a lot of the climate money in the IRA going to a lot of these red states or could be going to these red states. A handful of them have already rejected it. You know, Florida wants nothing to do with it. Idaho wants nothing to do with it.
David Roberts
What does Florida need with building codes?
Alexander Kaufman
Well, and not only that, Florida's senator Marco Rubio took the extra step just a few months ago of proposing, in one of the defense spending budget bills that was under debate in the Senate, a little poison pill provision that would essentially negate the existing federal law around adopting newer codes and said that the federal government would not be allowed to impose newer or stricter building codes via federal housing loan financing.
David Roberts
And I think, we don't want to be cynical, of course, but I think it's fair to say that Marco Rubio probably does not have passionate, deeply researched opinions on this subject. This is just the homeowners using him as a meat puppet, the home builders. Sorry, using him as a meat puppet. Is that fair?
Alexander Kaufman
Far be it for me to accuse a fellow layperson of not having a passion for this subject. I have learned so much in the past few years that I never expected to know about this very arcane but important issue in our country. So perhaps he has a genuine and passionate interest in this, and perhaps he has a genuine and passionate concern for the availability of affordable housing. And he is persuaded by the arguments coming from developers about that.
David Roberts
He's also a top recipient of their donations, is he not?
Alexander Kaufman
Well, he is indeed.
David Roberts
Coincidentally, I'm sure that makes their arguments all that more poignant, in his view. So that, I'm guessing didn't pass, or is —
Alexander Kaufman
Has not passed.
David Roberts
That poison pill has not passed. Are we worried that it might still?
Alexander Kaufman
I have not seen it resurface yet. It may come up again, but there hasn't been much movement on the federal change that Biden was considering for several months now. So perhaps we'll see it pop up again if there is news about these assessments and the implementation of this for FHA loans actually inching through the process a little bit further.
David Roberts
Right. So this is just, you know, I put this on the pile of very important federal regulations that need to get done and put on the books before the window opens for the Congressional Review Act, which true heads will recognize from previous presidencies. I think it's like, is it a 90-day window or a 60-day window? Something like that. Like, for some window of time after a federal regulation is passed, Congress can basically vote to overturn it. Now, obviously, if you're the Congress, if you're a democratic congress and a democratic president pass the regulation, you're not going to overturn it.
But if you're a democratic president and you pass a regulation, and then there's an election and then there's a republican Congress, within that 60-day window, they can throw out a lot of your late regulations. And this is what happened when Trump came in. That window was still open on a lot of Obama's regulations, and they just got tossed out immediately. So this is something a lot of green types are stressing out about right now. There's a lot of very important regulations that Biden has pledged to and is working on that are starting to flirt with that window.
And this is one of them.
Alexander Kaufman
Right. And don't underestimate the ability of people representing blue states to perhaps come down against something like this.
David Roberts
Right. It's not strictly partisan, is it?
Alexander Kaufman
Some of the state officials who have raised issues with some of the latest round of codes have actually come from the northeast region, you know, again, a region that has some of the highest electricity prices in the country, a region with obviously very variable weather, and a region where, unlike most of the country, I think, New York and New Jersey are the only two states where oil is still a major source of heating fuel. It will surprise you where you will find intransigence on these issues. It's not only coming from a lot of these other states, notably, too, because some of the newer construction in the country has taken place in the more temperate, redder states in the southwest or in the south. Heat pump adoption is actually very widespread, and electricity rates in many of those places are actually very low.
There isn't as much actual financial friction for the adoption of these things as there might be in some of the states that you would think would be more likely to support it.
David Roberts
Right. So that's up in the air still. But the feds have done some good stuff, just about federal buildings, right, in terms of what they directly control. Are the feds using these 2021 codes on their own buildings? Is that what they did, or is that — ?
Alexander Kaufman
So they have their own rules for their own buildings, but they set some really ambitious targets for net zero buildings, essentially in all federal buildings, and put money aside, I think, via the IRA, for doing some of those upgrades. So that's a sort of separate process. But given the challenges that the Department of Energy made to the changes in the ICC process to begin with, that kind of read, when that came out, I think at the end of 2022, some of those internal federal regulations for buildings as a bit of a challenge to the ICC as it was designing the next round of energy codes, showing that this is the standard that the federal government is going for for its own buildings, and therefore, there may be some desire to see that matched in the model code level. There has not been any kind of explicit threat or push for the establishment of some kind of federal code or federally mandated code, although there have been a lot of advocates and other groups who have been trying to seek out potential alternatives to the ICC.
If what they find at the end of this process is that the new process has made this an unworkable system for implementing codes that will actually lead to decarbonization and lower utility bills for people at a time when they're really struggling with that.
David Roberts
Interesting. So, the idea of an actual federal building code is out there. It's floating out there. It's a live possibility.
Alexander Kaufman
I think it has been discussed by some advocates who are frustrated with this current system, although there does not appear — you know, actually, the federal law from the mid-2000s that Obama used in 2015 to raise the FHA loans, does actually encourage the federal government to develop its own standards and codes, but absent that, urges it to use what the ICC develops. And despite that requirement, the federal government across administrations since that passage, has consistently gone with the ICC codes.
David Roberts
Yeah. If you say to the federal government, "Here's a bunch of work you could do, or you could do this other thing, that's no work."
Alexander Kaufman
Right. And it won't surprise you that the Trump administration was not particularly eager to push the envelope on any of these things. They did, in fact, do some things to somewhat sabotage the way that those assessments were supposed to work on the federal level. They sort of changed the criteria in a way that made it very confusing and essentially moot. Biden sort of reverted back to the way that it was before, but again, has sort of done the same thing that Obama did up until the end of his second administration, which was to let this linger, ignore the legal mandate that they had to actually carry out these assessments, and then only actually raise it to the lowest possible baseline at the moment where they were required to.
David Roberts
Right. So the feds have no mandatory building code of their own, but if they make the 2021 ICC codes the basis of FHA loans, it will be in the ballpark of national and mandatory at least.
Alexander Kaufman
In a sense, yes. Because if you are a housing developer in any state, why would you want to eliminate such a huge portion of potential buyers who would qualify for or need federal financing?
David Roberts
Right. So in the meantime, meanwhile, the 2021 standards only go into effect in states and cities that adopt them. And so then we saw this Washington Post story just a couple of days ago about lots of home builder associations basically pressuring states not to do it.
Alexander Kaufman
That's right.
David Roberts
And trying to pass state-level laws preventing cities from doing it.
Alexander Kaufman
That's right. So this is sort of how I became interested in this subject in the first place, is that it really was, in my view, an offshoot of the preemption bill narrative, where you saw all of these ambitious cities trying to act on the same thing that the cities were trying to act on when they came together to write the ICC codes in 2019. They said, "We can only control so much of our own emissions. This is one thing that we can control. And we don't want new gas hookups in new buildings. We don't want to dig ourselves into a deeper carbon hole. We're not banning gas in other buildings, necessarily in existing buildings, but the new ones can't dig us into a deeper hole."
And as your listeners are no doubt aware, that led to a massive backlash. And now I think at least half the country has adopted state-level laws that prevent cities and counties from going that route.
David Roberts
And it's weird, because I swear I heard Republicans say that they love local control and that democracy works best when it's closest to the citizens and the streets. And I don't know, I'm starting to think maybe that they didn't mean any of that.
Alexander Kaufman
Well, I think some of their arguments, to try to look at it charitably, I think they're looking at the risk of the gas death spiral. And a cynical way of looking at it is that they are doing the bidding of these utilities and that they want to preserve fossil fuels today, tomorrow, forever. But the other way to look at it is that a lot of people who live in older buildings and rely on gas, many of those people are perhaps retirees on fixed incomes. These are people who tend to be the most impacted by jumps in utility rates.
Now, this is an argument that gets used by the environmentalist side, too, right? That we should get people away from gas because gas is a fluctuating global commodity and we should use something that's steadier and cheaper, like electricity. But this, I think, is a genuine concern for them. And so avoiding that death spiral and avoiding a situation where you might see the degradation of this potentially dangerous if it's not being upgraded infrastructure is something that they feared. "Okay, these hippie towns that want to do this on climate aren't considering what the knock-on effects will be for the rest of the state."
David Roberts
"They're going to strand our poor rural constituents with gas." I expect we're going to see a lot of this in coming years. Basically like Republicans suddenly discovering a deep interest in the welfare of poor people on gas used as an excuse to block the transition. The other way to go would be like, "Yes, we're going to do this transition. Let's make a plan and protect those people on purpose." You know, like, instead of backing our way into this. But anyway, that's a long and ongoing argument.
Alexander Kaufman
I suspect it's already taking place. I mean, in places like New Jersey and New York, where I've seen it firsthand, you have had Republican lawmakers in New Jersey and Democrats that were on board with it as well, promoting lines from fuel merchants. Know this electrification requirement is a mandated tax on your grandma who needs her heating and she's going to freeze to death. And here in New York for a long time, I was seeing these ads on Facebook when I was still looking at Facebook a few years ago, that, you know, I don't remember the name exactly, but it was some alliance for energy justice and always using images of black people in NYCHA housing and really seemed like some kind of an environmental justice group looking out for some of the more marginalized communities here in the city, but was in fact, a front group for an organization that was promoting a gas pipeline that would be built to run gas from the Marcellus Shale into New York City.
David Roberts
Yeah. So one point I want to make clear here is that there was a study by FEMA in 2020 that found that — let me just read this quote from this story: "65% of counties, cities, and towns across the country have not adopted the most recent building — " this was in 2020. It was before the 2021 standards were even on the books, "have not adopted the most recent building codes, and that 30% of new construction is happening in places that either have no code or have not updated their code in 20 years." So despite the fact that these tighter, better building codes are on the books now, they are the official ICC code, most places in the country are not using them. So it is only through Biden tying them to FHA loans. That's sort of Biden's only tool to try to push adoption of these standards, basically from a pretty low starting point.
Alexander Kaufman
Well, that's one of his only sticks. But I would note that he also has the additional carrot of all of that money that was made available in the IRA. So it's not just telling these states you have to get your act together and adopt these codes and change everything up. It's saying there are millions and millions of dollars on the line for you to help you do this and to help you establish a new baseline for your state. So that is definitely available to them.
David Roberts
So, that is somewhat up in the air. We're going to see how Biden comes down. We're going to see whether he gets that done. The other thing that's kind of up in the air is — mathematically inclined readers will have figured out that 2024, the year we're in, is in fact three years after 2021, and thus it is time for a scheduled update to the ICC code, which is now happening using this new process without the voting, using this new sort of private, closed council process. Do we know how that's going?
Alexander Kaufman
We do indeed.
David Roberts
What's happening and when are we going to see those standards, the 2024 standards? Or code, sorry.
Alexander Kaufman
So, the drama around this actually started from the very beginning. The ICC, to its credit, tried to get out ahead of some of these issues and put in charge of a couple of the committees that they had, some of the more progressive governmental members. Actually, the head of building codes in your home city in Seattle is this guy, Dwayne Johnlin. Dwayne is widely recognized as a really forward-thinking voice on energy efficiency, and he is in charge of the commercial codes in this situation. What unfortunately happened, unfortunately for Dwayne, because it didn't make him look great, is that early in the process in 2022, when they came together and they assembled these committees and they were sussing out what ought to be in the 2024 code and what ought not to be, they were debating the same electrification issues that had been booted out through the appeals process in 2021.
They came up with the EV readiness stuff and with some of the electrification circuitry, and once again, in the midst of one of these debates, where things were going well and there was some disagreement, but ultimately, it seemed like there was a consensus building around the value of requiring those things, especially as things like the Inflation Reduction Act passed and there were all these other policies to promote electric vehicles that seemed to be moving forward. And then very abruptly, they considered striking that from the conversation. This really confused a number of people who were on the committee and had been duking this out for weeks and months already. Notably, this consensus process takes a lot more time.
So, if you are working for a trade association, that's probably not a big deal because you're paid to do stuff like this. But if you are volunteering your time on top of your normal governmental duties or on top of other advocacy duties that you have, this can be a real time suck for no money. And so people were very frustrated. A FOIA to the city government in Seattle helped to reveal why that was temporarily struck, and it was because there was an email that had come in from a consultant who was messaging from a gas utility in Missouri that was taking issue with the inclusion of those electrification provisions.
So, from the very get-go, it appeared that despite having already won this process, that was meant to favor an industry perspective, or at least favor it more so than the old process that gave the governments the right to vote at the end, the gas industry was kind of working behind the scenes to manipulate the outcomes. And there was a lot of frustration over this. I reported on it. It came out ultimately, they reversed the decision. They included the EV provision and moved forward. And things continued from there. Again, it was very time absorbing. It was really challenging, and at least on the residential committee, which was a much more contentious one. I guess when you're working on commercial buildings, it's a little less emotionally charged than people's houses.
And on the residential committee, they put it together, and they were discussing what should go in and what shouldn't. And early on, it became very clear to various people that were on it — this is according to conversations with various members that I've spoken to on and off the record. It became very clear that there were warring tribes and there were only a handful of people who were perhaps persuadable to one side or the other. And they were having these sort of informal votes to see who would support what. And to the delight of some people who were in support of a more efficient code, a lot of these more climate-friendly provisions were passing by simple majority.
But it only became clear to them later in the process, sometime last year, as they were trying to get to a code that could be more formally voted upon, that a simple majority was not acceptable; they had to reach a two-thirds supermajority in order to actually pass anything. So they started to panic. They started to panic. They said, "There's no way we're going to get this mean. This is already taking up so much time, and everyone is so firm in where they are." So there was an engineer and consultant from Connecticut who sort of saw herself as being a go-between the different sides.
She worked for a sustainable engineering firm, so she knew how to talk the talk with the advocates. But on the other side, she's working in the construction industry. So she was able to hear her colleagues on the home building side hear their complaints and understood. And so she tried to put together these informal forums where people could suss out what they could support and where there might be some compromises. And they ultimately came down to the code that is now being discussed and put forward, which is pretty good. According to the Pacific Northwest National Lab, which has done some preliminary assessments of the draft, this is as good or more efficient than the 2021 code, which is a positive for a lot of people who were looking at this new process and assuming it was going to lead to a reversal of fortunes.
David Roberts
Yeah, so they're probably not going to go backward. They're probably not going to revert.
Alexander Kaufman
That is how things are looking, at least right now. But the fact that a lot of these codes were ultimately decided on via compromises that came out of these informal forums that made the gas industry, once again, very angry. They said that while they had the opportunity to participate in those, they said that this was outside the bounds of the normal process, that this had violated the process, that this was sort of another example of the cartel behavior that they complained about in 2021, when the US Conference of Mayors was ganging everyone together to vote for things that the industry people said they didn't understand.
David Roberts
A cartel is when your opponents organize.
Alexander Kaufman
Right.
David Roberts
So that's up in the air. Is it possible that that process will finish, the 2024 code will go on the books, and then Biden could apply that to FHA loans, depending on which one of these processes finally resolves first?
Alexander Kaufman
Well, first, what they will need to do is get through the appeals process. So what has happened recently is that at the end of last year, as they were getting to the final stages of the process, the gas industry decided to file a bunch of different appeals at the very last minute. The ICC, in a move that really agitated a lot of advocates who felt that it was scandalous to violate your own rules to accommodate the industry, the ICC decided to give them more time than they were normally allotted to make those complaints and appeals. And that appeals process is happening right now.
The hearings are this week, and so they are hearing that before the appeals board. The appeals board at the ICC will then be tasked with making a decision on whether those appeals are fair and in bounds or not, and that will ultimately determine, I think, the final quality of the 2024 code. Now, will Biden be able to adopt that instead? Not quite. Biden is held to this federal legal process, the first step of which is the regulators at the Department of Energy making an assessment about the nature of that code.
David Roberts
Right. So they'd have to assess the new ones.
Alexander Kaufman
They'd have to assess the new ones.
David Roberts
Which would make the whole thing take longer, which would definitely get into that CRA window.
Alexander Kaufman
Correct.
David Roberts
So the best we can probably hope for from Biden is getting the 2021 codes.
Alexander Kaufman
That's correct. They won't be able to implement this in any kind of speedy fashion, certainly not before the election. So the best hope of the 2024 codes, should they be assessed as reasonable and energy saving, would be that they are adopted in the next administration. Now, if that administration is a Trump administration, that is highly, highly unlikely. If that administration is a Biden administration, we'll have to see. I mean, Biden has yet to actually finally implement the changes that he appears to be leaning toward implementing, and that would be quite a sea change unto itself. So whether or not this actually becomes federal policy in the end is a very big, open question.
But there are many, many future emissions that are at stake in that question.
David Roberts
Interesting. Well, good grief, Alex, thank you for coming on. I bet I'm guessing the vast majority of listeners like me knew virtually nothing about this going in here. So it's just fascinating. There are little battles that echo the big battles just happening every which way you look, many of them completely obscured.
Alexander Kaufman
Well, thank you for covering this and for taking an interest in it. I apologize for the meandering way I'm discussing it. I hope you can appreciate now the intricate nuances involved in this that make it challenging to make bold, overarching, and easy to comprehend statements about the process. But the nuances are really important because that's where the battles are being fought and won.
David Roberts
All right, well, maybe we'll return to this issue a little bit later and see how some of these big questions turned out. But thank you for bringing us up to date, so we're all aware of what's going on, and I encourage everyone listening to follow Alex's reporting on HuffPo, where you can find out in real time the latest.
Alexander Kaufman
Thank you very much. I'm also on Substack at kaufman.substack.com for those of you who like this app. And I want to say thank you, Dave, and congratulations on the newest member of the Volts family. I really enjoyed seeing that adorable puppy in my inbox.
David Roberts
Thank you for listening to the Volts podcast. It is ad-free, powered entirely by listeners like you. If you value conversations like this, please consider becoming a paid Volts subscriber at volts.wtf. Yes, that's volts.wtf. So that I can continue doing this work. Thank you so much and I'll see you next time.
The obscure but extremely important battle over building codes