Fight Over Green Building Code Highlights Challenge Of Phasing Out Carbon

Feb 6, 2020

A proposal before the Honolulu City Council aims to reduce the long-term carbon footprint of Oahu’s buildings, but it has run into opposition from the island’s gas utility and construction industry.

The U.S. Energy Information Administration says almost 40 percent of energy consumed in the United States goes to power buildings. That’s led many state and local lawmakers to modify building codes in an effort to reduce carbon emissions.

According to the Natural Resources Defense Council, 42 states and hundreds of cities around the country take this approach.  

Honolulu may soon join that list. For the first time in over a decade, the City Council is considering updates to Oahu’s building code, with an eye toward reducing energy use.

The American Council for an Energy Efficient Economy recently rated Honolulu the fourth worst city in the country when it comes to encouraging the construction of energy-efficient buildings.

In an effort to change that, clean energy advocates are championing Bill 25. It includes some non-controversial provisions, like mandating more efficient insulation and lighting.

But others have generated opposition — in particular, a ban on gas water heaters in new single-family homes and a requirement for more electric vehicle charging infrastructure in apartments and commercial buildings.

The construction industry has come out against those parts of Bill 25. Nathaniel Kinney with the Hawaii Construction Alliance says solar water heaters and EV charging stations will increase the price of new housing.

“For the solar water heating mandate at least $10,000, for the electrical vehicle charging infrastructure requirements that could range anywhere from $10,000 to $15,000 a unit,” Kinney said in an interview.

He argues that the increase will put housing even further out of reach for residents, in what is already one of the country’s most expensive markets. A $10,000 increase in the sticker price of a house would add $2,000 to a 20 percent down payment.

The median price of a single-family home on Oahu was $820,000 in December, which would make a 20 percent down payment approximately $160,000.

The $10,000 figure is disputed by green energy advocates, who say the actual increase would be much lower. The Hawaii Solar Energy Association said in an email the retail cost to retrofit a solar water heater is not more than $6,000-$7,000. 

The Honolulu Office of Climate Change, Resiliency, and Sustainability put the figure even lower, citing amounts included in previous building permits.

A graph showing the value of construction output in both Hawaii and the broader United States.
Credit Taken from DBEDT's 2014 report "Construction and Hawaii's Economy"

The Hawaii Construction Alliance is lobbying for units designated as affordable housing to be exempt from the proposed requirements. Kinney says he would like to see condos and houses in the range of 80 to 140 percent of the Area Median Income granted a waiver.

Leaders in the local construction industry are also worried about their own economic futures. Construction is one of the first sectors to be hit during a recession and the state’s chief economist is predicting a weaker demand for new construction in 2020.  

Kinney says builders are wary of any regulatory requirements that could further depress demand by increasing the cost of construction. Both the Hawaii and broader U.S. construction industries experienced double-digit declines in output during the Great Recession of 2008-2009.

But advocates of greening the building code say the new rules will actually save homeowners money. The Honolulu-based Blue Planet Foundation has been an advocate in favor of adopting greener building standards.

Jeff Mikulina, Blue Planet’s director, says that while the changes may raise the cost of an initial down payment, consumers could save thousands more in lower utility bills over the term of a mortgage.

“It may cost a little bit more upfront but you quickly recoup that because you don't have to pay for electricity or gas,” Mikulina told HPR. He added that the changes could produce up to $1 billion in savings over a 20-year period.

Blue Planet would like to go ever farther than what is currently included in Bill 25, particularly when it comes to electric vehicles. While a draft of the new building code requires 25 percent of parking spaces in new commercial and multi-family apartment buildings come with basic infrastructure for electric vehicle charging stations, Mikulina would like that increased to 100 percent.

“We really need new tools to help people adopt electric vehicles,” Mikulina said in an interview. He cites the City of North Vancouver, which began requiring all multi-use residential buildings built after June 1, 2019 come equipped with 100 percent EV-ready parking lots.

The construction industry is not alone in opposing the greener building code. Hawaii Gas, the state’s only gas utility, has come out hard against Bill 25. The company has spent almost $10,000 on targeted Facebook ads encouraging residents to oppose the measure.

The company is specifically concerned about the requirement that all new single-family homes use a solar water heater, rather than natural gas.

Kevin Nishimura, Hawaii Gas vice president of operations, told HPR that 80 percent of the company’s customers are residential homes, although they make up only 10 percent of overall consumption. He said Hawaii Gas would accept the solar water heater requirement if homeowners had a way to request an exemption and get gas service.

Nishimura cites the state building code, which requires solar water heaters, but allows home owners to apply for a variance. The State of Hawaii recently lost a lawsuit alleging it was improperly approving those requests.

Nishimura also argues that solar water heaters are not as green as people think.

“The solar water heater is backed up by an electric heater element, so when there’s not enough sun, it uses electricity to heat water. Right now, our electricity is 70 percent produced with oil.”

Since September, Hawaii Gas has spent just under $10,000 on targeted Facebook ads encouraging people to oppose Bill 25.
Credit Screenshot from Facebook Ad Library

Hawaii is currently ranked as the most petroleum dependent state in the country. A state law aims to aggressively reduce that dependence by requiring all of Hawaii’s electricity come from renewable sources by 2045.

However, Maria Stamas with the Natural Resources Defense Council argues that greener building codes are not to generate an immediate reduction in carbon emissions but rather produce results over future decades.

“Even if there's a small short-term loss in carbon emissions, it still would make sense because it's going to take 50 years before you take another look at that building and it’s much more expensive to retrofit it later,” Stamas said in an interview.

The point gets at the core challenge of decarbonizing large economies: short-term costs are often weighted more heavily than long-term ones.

In a January hearing, Honolulu City Council members disagreed over how extensive green revisions to the building code should be. They tabled idea to consider competing drafts.

The next opportunity to consider the idea will be at a Feb. 27 meeting of the council's Committee on Zoning, Planning, and Housing.