Loading...
HomeMy WebLinkAboutNRCan Scan of Carbon Code Requirements to Address GHG Emissions - Final Report Prepared for: Buildings Division/Homes & Communities Division Office of Energy Efficiency Natural Resources Canada Posterity Group 135 Laurier Ave. West, Suite 408 Ottawa, ON K1P 5J2 Final Report Date: November 14, 2022 Scan of Code Requirements to Address Greenhouse Gas Emissions i Contents Acronyms ii Executive Summary iii 1 Introduction 1 2 Method 4 2.1 Jurisdictional Review 4 2.2 Stakeholder Interviews 5 3 Key Findings 6 3.1 Methods to Reduce Fossil Fuel Use 6 3.2 Structure of Operational Emissions Limits 8 3.3 Complementary Requirements 11 3.4 Flexibility Mechanisms 14 3.5 Choice of Emissions Factors 15 3.6 Importance of Consultation in Carbon Code Development Process 16 3.7 Evidence-Based Carbon Code Development 16 3.8 Enforcement and Unintended Consequences 19 3.9 Challenges Faced to Establish Embodied Carbon Policy 19 4 Options Assessment for Future Carbon Codes 23 4.1 Homes 24 4.2 Buildings 27 Appendix A Overview Table A-1 Appendix B Interviewee List B-1 ii Acronyms BC: British Columbia BR18: Bygningsreglementet-Technical provisions (Denmark) CAGBC: Canada Green Building Council CALGreen: California Green Building Standards Code CHBA: Canadian Home Builders' Association EPBD: Energy Performance of Buildings Directive (European Union) EPD: Environmental product declaration EU: European Union EV: Electric vehicle GHG: Greenhouse gas GWP: Global warming potential LCA: Life cycle analysis MURB: Multi-unit residential building PV: Photovoltaic RE2020: Réglementation Environnementale (France) RNG: Renewable natural gas TGS: Toronto Green Standard VBBL: Vancouver Building Bylaw UK: United Kingdom iii Executive Summary Introduction The Government of Canada has committed to reduce GHG emissions by 40-45% below 2005 levels by 2030, and to achieve net zero emissions by 2050. Canada’s model national building codes limit excessive energy use but do not include requirements to limit greenhouse gas (GHG) emissions from new homes and buildings. For this reason, the Ministers of Natural Resources and Innovation, Science and Industry have been mandated to publish a net-zero emissions code by 2024 that aligns with Canada’s climate objectives. To inform this code development, Natural Resources Canada hired Posterity Group to provide a comprehensive perspective of code requirements for homes and buildings1 that support GHG reduction targets. This work included a jurisdictional scan of domestic and international building code requirements in the form of desktop research and interviews with code officials from select jurisdictions. Key Findings: Code Requirement Themes Methods to Reduce Fossil Fuel use Two approaches to the treatment of fossil fuels in new homes and buildings were identified through the jurisdictional review and interviews: an implicit ban on fossil fuels, and an explicit ban on fossil fuels. In jurisdictions with implicit bans on fossil fuels, compliance is difficult if natural gas is used. Structure of Operational Emissions Limits Three themes emerged related to the structure of operational emissions limits: performance limits versus prescriptive paths, methods to normalize limits (by region and by typology), and communication of future limits. 1) Performance Limits vs Prescriptive Paths Three types of operational emissions performance limits were identified for homes: limits normalized by floor area in kg CO2e/m2/home/year, absolute limits in kg CO2e/yr and limits relative to a modelled reference home. Three prescriptive compliance paths for operational emissions were identified for homes: an explicit ban on fossil fuel use, a points-based path, and a path to decarbonize one or more systems (e.g., space heating or water heating). 1 In this report, “homes” refers to low-rise residential occupancies. “Buildings” refers to all other occupancies. The Timing of this Report Code requirements linked to GHG reduction targets are in development in many jurisdictions around the world. The findings presented in this report reflect data gathered from July 2022 to October 2022 and are expected to be valuable to support Canada in the development of a net-zero emissions code by 2024. Codes committees and task groups should consider reviewing new jurisdictional material in 2023 or early 2024 in parallel with its code development activities. iv Two types of operational emissions performance limits were identified for buildings: limits normalized by floor area in kg CO2e/m2/year, and a limit relative to a modelled reference building. Two prescriptive compliance paths for operational emissions were identified for buildings: a points-based path, and a path that explicitly bans fossil fuel use. 2) Methods to Normalize Performance Limits In addition to normalizing by floor area, two other methods to normalize performance limits were identified: by region and by home or building typology. 3) Communication of Future Limits A common theme from the jurisdictional review and interviews was increasing stringency of operational emissions limits over time towards net zero emissions for homes and buildings. These limits were communicated early so that industry would have time to prepare for the changes. Complementary Requirements Examples of complementary requirements were identified under the following headings:  EV-readiness: EV-ready or EV-capable (i.e., requirement to have electric vehicle supply equipment installed or a raceway to accommodate a decided 208/240-volt branch circuit) spaces are required for new homes and buildings in many jurisdictions.  Renewable Energy Generation: renewable energy generation requirements were identified for new buildings in the United States and Denmark2. Renewable energy generation is listed as voluntary for new homes and buildings in many jurisdictions.  Demand Response: demand response requirements were identified in the NBI’s Building Decarbonization Code for thermostatic controls, water heating and lighting; the US DOE and PNNL Stretch codes for water heating and thermostats; and in Seattle’s upcoming energy code for electric storage water heaters that meet certain criteria3. Flexibility Mechanisms The use of on-site renewables to meet operational emissions limits is allowed in several jurisdictions. Flexibility mechanisms for all-electric requirements were identified for cooking and backup heating. Choice of Emissions Factors Several interviewees explained that simplicity was prioritized in establishing emissions factors for their carbon codes, especially for the first iteration of the code. Key Findings: Code Development Process Themes Importance of Consultation in Carbon Code Development Process Interviewees attributed lack of pushback on code requirements to industry’s involvement in an open and transparent development process. Others viewed stakeholder consultation as an opportunity to educate and connect with the people who will be impacted by new regulations. 2 One example of a renewable energy generation requirement for new homes was identified in New York City. 3 With some exceptions, will apply to electric storage water heaters with rated water storage volume between 40 and 120 gallons and a nameplate input rating equal to or less than 12kW. v Evidence-Based Carbon Code Development Pre-feasibility and affordability studies, and energy modelling were completed in several jurisdictions to ensure carbon code requirements were evidence-based, feasible and/or cost-effective prior to publication. Enforcement and Unintended Consequences Interviewees explained that carbon codes are enforced similarly to building codes, and that the same staff will be tasked with ensuring both types of compliance. Unintended consequences of carbon code requirements that surfaced through the interviews included exposing knowledge gaps, and a potential conflict between requirements in the energy code and carbon code. Challenges Faced to Establish Embodied Carbon Policy Identified challenges associated with the development and introduction of embodied carbon policy included defining the scope and boundary of the life cycle analysis, managing complexity so that the calculation methodology would be accessible and understandable for the intended audience, lack of EPDs in some jurisdictions, and lack of tools and training to support industry. Options Assessment Options assessments were completed for homes and buildings, informed by findings from the jurisdictional review and interviews. The options assessments focus on requirements related to operational carbon, fuels, grid emissions factors, and electrification, and will inform the development of requirements in Canadian building code. Structure of Operational Emissions Limits Operational emissions limits normalized by floor area or expressed relative to the performance of a reference home or building are well-suited to homes and buildings with energy models. A tiered (stepped) approach to presenting operational emissions limits for homes and buildings lays out a performance trajectory so that industry can plan accordingly. Prescriptive requirements for homes to decarbonize space and/or water heating systems, or a prescriptive points-based system that translates to operational emissions savings are simple for stakeholders to understand. These approaches are well-suited to homes without energy models and may be advantageous to new homes in remote communities where the number and availability of energy advisors may be lower compared to urban centers. Limits normalized by floor area for buildings accounts for variations in size. Only one example of a prescriptive points-based system for buildings was identified for buildings, in the Ithaca Energy Code Supplement. Common practice that emerged for the structure of operational emissions limits was to mirror the approach for the presentation of energy use limits. Variation of Limits by Home Size Normalizing operational emissions limits by floor area or setting absolute limits by home size (e.g., separate limits for small homes versus large homes4) creates a more level playing field for homes of 4 In the VBBL, a large home has a floor area greater than 325 m2. vi different sizes but adds complexity for stakeholders. Common limits are a disadvantage to small homes with less conditioned floor area compared to larger homes. Common practice that emerged from the jurisdictional review and interviews was not to vary operational emissions limits by home size. Variation of Limits by Typology Variation of operational emissions limits by typology for homes and buildings adds complexity for stakeholders. This added complexity may yield diminishing returns for homes, since the variation in occupancy patterns and end use loads is relatively homogenous across home types as compared to buildings. In addition, attached homes don’t have as many exposed walls as detached homes. No examples of variation by typology for homes were noted in the jurisdictional review or interviews. In contrast, examples of variation of limits by building typology were observed in the jurisdictional review. This approach accounts for occupancy pattern variations across different building types and recognizes that end-use intensities vary by building type. For example, more hot water is used in hotels, motels and multi-unit residential buildings (MURBs) than in offices. Limits by building typology would account for this, while common limits would not. Common practice that emerged from the jurisdictional review and interviews was variation of operational emissions limits by building typology. Grid Emissions Factors Regional grid emissions factors add complexity for energy modellers, builders and designers who may operate in more than one climate zone within a province or territory but account for regional differences in the electricity supply mix. National emissions factors are a ‘free pass’ for regions with a carbon intensive grid. Future emissions factors can be used to account for planned grid decarbonization but are uncertain. Monthly factors reflect realistic annual variation in the electricity supply mix. Common practice was to use current, annual, national (or jurisdiction-wide) grid emissions factors. Fuels Carbon codes that permit fossil fuels provide flexibility for builders and designers and may reduce pushback from stakeholders during consultation processes, even if compliance is difficult when fossil fuels are used. Further, codes that permit fossil fuels rely on the stringency of performance limits to limit fossil fuel use. Codes that explicitly ban fossil fuels provide clarity for builders and designers, and more certainty regarding GHG emissions impact than codes that permit fossil fuels. No common practice emerged from the jurisdictional reviews and interviews, as several examples of codes that permit and ban fossil fuels were identified. Electrification The inclusion of electric-ready provisions in a carbon code provides flexibility for the future if all-electric requirements are introduced. For example, if gas cooking is permitted for homes or restaurants, an electric-ready provision for cooking ensures possible conversion later. Similarly, EV-ready provisions facilitate the future installation of EV chargers. EV requirements take things one step further to ensure chargers are in place once new home or building construction is complete. Electrification-ready and EV- ready provisions emerged as common practice for homes and buildings in jurisdictions with codes that permit fossil fuels. 1 1 Introduction The Government of Canada has committed to reduce GHG emissions by 40-45% below 2005 levels by 2030, and to achieve net zero emissions by 2050. Canada’s model national building codes limit excessive energy use but do not include requirements to limit greenhouse gas (GHG) emissions from new homes and buildings. For this reason, the Ministers of Natural Resources and Innovation, Science and Industry have been mandated to publish a net-zero emissions code by 2024 that aligns with Canada’s climate objectives. To inform this code development, Natural Resources Canada hired Posterity Group to provide a comprehensive perspective of code requirements for homes and buildings5 that support GHG reduction limits. This work included a jurisdictional scan of domestic and international building code requirements in the form of desktop research and interviews with code officials from select jurisdictions. Posterity Group conducted the jurisdictional review via desktop research of building and carbon codes and supplementary material (e.g., PowerPoint presentations, white papers, etc.) to identify requirements for homes and buildings under the following categories6:  Operational emissions limits  Electrification  Renewable Energy Generation  Demand Response  Embodied Carbon Limits or Measurements The jurisdictions and codes examined in the study are presented in Exhibit 1. 5 In this report, “homes” refers to low-rise residential occupancies. “Buildings” refers to all other occupancies. 6 Requirements under the categories listed were not identified in every jurisdiction and code examined. The Timing of this Report Code requirements linked to GHG reduction targets are in development in many jurisdictions around the world. The findings presented in this report reflect data gathered from July 2022 to October 2022. As codes that are currently in development come into force, domestic and international requirements linked to GHG reduction targets presented in this report will become outdated. For example, a revision to the European Union’s Energy Performance of Buildings Directive is expected to be released in late 2022, and Finland is in the process of finalizing their roadmap for low carbon construction and the built environment. The findings presented here are expected to be valuable to support Canada in the development of a net-zero emissions code by 2024. Codes committees and task groups should consider reviewing new jurisdictional material in 2023 or early 2024 in parallel with its code development activities 2 Exhibit 1: Jurisdictions and Codes Examined Jurisdiction Code or Standard Canada Canada Green Building Council Zero Carbon Building Design Standard Version 3 Toronto, Canada Toronto Green Standard British Columbia, Canada Carbon Pollution Standard Vancouver, Canada Vancouver Building Bylaw United States International Energy Conservation Code United States International Residential Code United States ASHRAE 90.1-2019 United States New Buildings Institute “Building Decarbonization Code” United States US Department of Energy (DOE) and Pacific Northwest National Laboratory (PNNL) Stretch Codes California, USA California Green Building Standards Code (CALGreen) Santa Monica, USA 2020 Energy Reach Code Marin County, USA Title 19 Marin County Building Code Washington, USA Washington State Energy Code Seattle, USA Seattle Building Code New York, USA Energy Conservation Code of New York State New York City, USA Local Law 154 Town of Ithaca, USA Ithaca Energy Code Supplement Massachusetts, USA Massachusetts State Building Code 780 United Kingdom The Building Regulations, Part L France Réglementation Environnementale (RE) 2020 The Netherlands Energy Performance of Buildings Directive (EPBD) of the European Union (EU) Environmental Performance Assessment Method for Construction Works Denmark Bygningsreglementet-Technical Provisions Norway Regulations on Technical Requirements for Building Works Sweden Boverket´s building regulations – mandatory provisions and general recommendations Finland Decree of the Ministry of the Environment on Energy Performance of New Buildings New Zealand7 Transforming Operational Efficiency Framework Whole-of-Life Embodied Carbon Assessment: Technical Methodology 7 The operational efficiency framework and embodied carbon technical methodology are not yet in force. 3 Following the jurisdictional review, Posterity Group conducted structured interviews with code officials from select jurisdictions to confirm the carbon code requirements, and to examine their experiences with code development, adoption, implementation, and enforcement. The results of the research are intended to provide options to building code development groups determining the direction of potential requirements in Canada. The remainder of this report is structured as follows:  Section 2 summarizes the method  Section 3 presents key findings for homes and buildings  Section 4 presents the options assessments for homes and buildings  Appendix A points to the companion MS Excel file entitled “Appendix A – Overview Table”  Appendix B lists the interviewees for the study Sections 2 and 3 present the study method and key findings applicable to both homes and buildings. Dedicated chapters for the homes and buildings options assessments are presented in sections 4.1 and 4.2, respectively. Appendices A and B apply to both homes and buildings. 4 2 Method This section presents the study method for the jurisdictional review and interviews. 2.1 Jurisdictional Review Posterity Group conducted a jurisdictional review via desktop research to identify Canadian and international jurisdictions with carbon codes in development or in force, and to collect requirements under the categories shown in Exhibit 2. In addition, Posterity Group identified the following data for each jurisdiction under study:  Climate zone(s) impacted  Applicability (e.g., new and/or existing homes and/or buildings)  Year of adoption  Relationship to local energy code  Code basis (i.e., ASHRAE 90.1, IECC, unique code, etc.)  Scope of operational emissions and/or embodied carbon limits calculations Results of the jurisdictional review are provided under separate cover, in a companion MS Excel spreadsheet entitled “Appendix A – Overview Table.” Exhibit 2: Requirements Under Study Requirement Examples Operational emissions limits  Absolute GHG emissions limit  GHG intensity limits Electrification  All-electric or electric ready requirements  EV or EV-ready infrastructure  Heat pump or cold climate heat pump requirement (or ban of fossil fuel or electric resistance heating)  Trade or easing of other compliance requirements when selecting an all-electric vs mixed-fuel pathway Renewable Energy Generation  Solar PV, solar thermal or solar readiness  On-site renewable requirements  Expansion of solar and battery standards  Offset allowances Demand Response  Infrastructure (energy storage ready infrastructure)  Controls (thermostats, DHW storage, lighting level reduction) Embodied Carbon Limits or Measurements  Disclosure and tracking of carbon in materials  Requirement to use LCA  GHG intensity limits by building area or by material unit basis 5  GWP limits on refrigerants in mechanical equipment  Exceptions for recycling or re-use of existing material  Requirement to consider wood use Other  Requirements to meet other certification programs (CHBA net zero home certification program, Passive house, or an alternative emission standard certificate)  NetZero Energy Ready Code or Tiered/Stretch/Step Code  Other key GHG reducing requirements and features tied to a net zero emissions pathway 2.2 Stakeholder Interviews Interviews were completed with representatives from select jurisdictions to supplement findings from the jurisdictional review, and to conduct a deeper assessment of the options for code requirements that support GHG reduction targets. The goals of each interview were to:  Confirm the inclusion and scope of GHG reduction requirements within the building code or standard,  Gather information on the code development process (e.g., technical considerations and strategies),  Understand the qualitative and quantitative impacts of GHG reduction targets in the building code/standard, and  Gather insights on the successes and challenges associated with introducing and maintaining GHG reduction regulations within each jurisdiction. The study team developed an interview guide template and provided a customized copy to each interviewee ahead of the scheduled meeting. Each interview lasted approximately one hour. Exhibit 3 shows the number of interviews completed by region. All interviews were conducted by phone or video call, except for one Canadian and one international jurisdiction where written responses to interview questions were provided. One interview was completed with representatives from the United States to provide an over-arching view of carbon codes, and one interview was completed with a representative from the United States who provided an over-arching view on carbon codes in the Northeast United States. The scope of each interview covered both homes and buildings. Exhibit 3: Summary of Interviews Location Interviews Completed Canada 2 United States 5 International 6 Sections 3 that follows presents findings from the jurisdictional review and the stakeholder interviews, with subsections highlighting key themes that emerged from each interview. 6 3 Key Findings This section presents key findings and themes that emerged from the jurisdictional review and interviews under the following topics: Code Requirement Themes  Methods to reduce fossil fuel use: Implicit and explicit bans on fossil fuels and electrification requirements.  Structure of operational emissions limits: Level of specificity by size, region, type, and through time.  Complementary requirements: Code requirements supporting EVs, demand response, and renewable energy generation.  Flexibility mechanisms: Allowances for renewables to offset operational emissions, carbon offsets, and exceptions.  Choice of emissions factors: Choosing simplicity over precision. Code Development Process Themes  Importance of consultation in carbon code development process : Engaging the public and industry during the carbon code development process.  Evidence-based carbon code development: Building an evidence base for carbon codes through modelling, stress-testing using real home or building data, and assessing cost-effectiveness and affordability.  Enforcement and unintended consequences: Enforcing carbon codes, penalties for non- compliance, and unintended consequences of requirements.  Challenges faced to establish embodied carbon policy: Challenges in defining scope, balancing complexity with accessibility, how to ensure data quality and availability, and access to tools and training to support industry. Findings apply to both homes and building unless specified in the narrative. 3.1 Methods to Reduce Fossil Fuel Use Two distinct approaches to the treatment of fossil fuels in new homes and buildings were identified through the jurisdictional and interviews: an implicit ban on fossil fuels, and an explicit ban on fossil fuels. This section explores these approaches and provides examples of each one. Implicit Ban of Fossil Fuels A common theme that emerged through the interviews was an implicit ban on fossil fuels in new homes and buildings. An interviewee from Toronto explained that electrification cannot be mandated directly because it would be considered a prescriptive requirement that could conflict with the Ontario Building Code. Therefore, electrification would have to be mandated implicitly, and would be inevitable as operational emissions limits are reduced. Interviewees from the UK and France echoed this finding. They explained that although fossil fuels are not explicitly banned in the UK or France, compliance with Part L of the Building Regulations 2010 and RE2020, respectively, is difficult if natural gas is used in new homes 7 and buildings. In addition, in some jurisdictions, heat pumps may be implicitly required as well due to high efficiency requirements. Interviewees from Toronto and the Town of Ithaca explained that the downside of implicit bans is that it is difficult to address unregulated fossil fuels without an explicit ban, for example fireplace use, cooking and other laboratory or factory loads. BC is investigating a modelling guideline update to address this. In the Ithaca Energy Code Supplement, there is no explicit ban on fossil fuels for space heating, water heating, or cooking. However, up to six of the six prescriptive path points required for compliance can be earned by electrifying space heating, water heating and cooking in buildings. For homes, up to nine points can be earned by electrifying space heating, water heating, cooking, and clothes drying, while only six points total are required for compliance. Under Seattle’s current Building Code, there is a requirement to select several above-code measures from a list of options for new homes. According to an interviewee from Seattle, 90% of new homes appear to be electing heat pump options. In the draft Seattle Building Code under consideration for 2023, heat pumps will be required for space heating and water heating in homes, although as a compromise, gas backup heating would still be permitted. Explicit Ban of Fossil Fuels or Electrification Requirements In other jurisdictions, there is an explicit ban on fossil fuel combustion in new homes and buildings. In California for example, dozens of cities including Petaluma, Fairfax, Alameda, San Jose, Santa Cruz, and Morgan Hill have adopted gas bans that prohibit gas infrastructure in new homes and buildings. Dozens of other cities in California have adopted electric-required or electric-preferred8 reach codes that exceed minimum state energy standards9. With some exceptions (e.g., if the rooftop area is limited, if location for the condensing part of the heat pump is an issue, etc.), new buildings in The Netherlands have not had natural gas connections since 2018. These new buildings have heat pumps and solar panels or are connected to district heating systems. The gas field in Groningen province, which at one time was connected to virtually all homes and buildings in the Netherlands, is expected to be closed between 2025 and 2028. New York City’s Local Law 154 prohibits the combustion of substances that emit 25 kg or more of CO2e per million BTU of energy in new homes and buildings10. This means that natural gas, which emits approximately 50 kg of CO2e per million BTU of energy, is not permitted. The language in Local Law 154 focuses on air emissions, which likely helped it pass according to an interviewee from New York City. As of June 2021 in Seattle, heating in new buildings cannot be provided by electric resistance or fossil fuel combustion appliances (including natural gas, heating, oil, propane, or other fossil fuels). However, there is a long list of exceptions, allowing limited electric resistance use for small loads (e.g., individual rooms in an apartment building) and supplementary heat for very cold weather. Service hot water must 8 An electric-preferred reach code requires buildings with gas systems to achieve higher energy standards. 9 T. DiChristopher, “Gas ban monitor: Calif. count reaches 50 as West Coast Movement Grows,” S&P Global, 23-Nov-2021. [Online]. Available: https://www.spglobal.com/marketintelligence/en/news-insights/latest-news- headlines/gas-ban-monitor-calif-count-reaches-50-as-west-coast-movement-grows-67732585. [Accessed: 03-Oct- 2022]. 10 The nine exceptions to Local Law 154 set different compliance dates for various building types and systems. The first compliance date is January 1, 2024. 8 be provided by an ASHP water heating system for permits applied for after January 1, 202211. The interviewee from Seattle explained that Washington State will enforce similar rules on July 1, 2023. Other notable electrification requirements identified include:  For new homes under the prescriptive compliance path of the Vancouver Building Bylaw (VBBL), all systems must use electricity except for gas fireplaces. The maximum combined rated input for all gas fireplaces in a home must be less than 60,000 BTU/hr.  In Marin County, new buildings must be all-electric.  In New York City, new buildings of all sizes must be constructed fully electric by 2027.  In Washington state, most new buildings and large MURBs will have to install heat pumps for space heating under a provision of the revised energy code to be effective July 1, 2023. An overall trend towards electric heat pumps was also observed in other jurisdictions.  Massachusetts has a ten-city pilot program that bans fossil fuels from most new construction, except for labs and hospitals.  Finland will phase out fossil fuel oil in heating in new buildings by the start of the 2030s12. In Norway, the installation of fossil fuel heating systems in new buildings is not permitted. 3.2 Structure of Operational Emissions Limits Operational emissions limits were identified in several domestic and international jurisdictions. These operational emissions limits were expressed relative to direct and indirect GHG emissions associated with fuels used by the home or building during its operation. This section explores themes related to the structure of the limits under three headings: performance limits versus prescriptive paths, methods to normalize performance limits, and communication of future limits. 1) Performance Limits vs Prescriptive Paths Performance Limits: Homes Performance limits for the operational emissions from homes are typically normalized by floor area in kg CO2e/m2/year, although they are occasionally expressed on an absolute basis in kg CO2e/home/year. In some jurisdictions (e.g., UK, Washington, Seattle), operational emissions limits are expressed relative to a modelled reference home. As shown in Exhibit 4, BC’s proposed Carbon Pollution Standard offers two performance options for homes. Option one is an absolute limit in kg CO2e/house/year, and option two has a limit normalized by floor area in kg CO2e/m2/year and an absolute limit. Option 1 is well suited to small homes, while option 2 is more applicable to medium and large homes. 11 There are exceptions here to: Instantaneous water heaters, solar heaters, wastewater heat recovery, ground source, water source, meeting NEEA advanced water heater specifications, existing district systems, replacement equipment, process equipment (commercial food service). 12 “Finland's Integrated Energy and Climate Plan,” Valto, 20-Dec-2019. [Online]. Available: https://julkaisut.valtioneuvosto.fi/handle/10024/161977. [Accessed: 11-Nov-2022]. 9 Exhibit 4: Performance and Prescriptive Limits for New Homes in BC’s Proposed Carbon Pollution Standard Prescriptive Pathways: Homes Three prescriptive compliance paths for operational emissions were identified for homes: an explicit ban on fossil fuel use (discussed in section 3.1), a points-based path, and a path to decarbonize one or more systems (e.g., space heating or water heating). Ithaca Energy Code Supplement has a points-based compliance path for homes. New homes must earn a minimum of six points total, covering categories of efficient electrification, affordability improvements, renewable energy, and other (e.g., development density, walkability, EV parking spaces, etc.). For example, three points are awarded for air source heat pumps for space heating, one point is awarded for installing heating systems in directly heated spaces, up to three points are awarded for on-site or off- site renewable electric systems or on-site renewable thermal systems, and one point is awarded for achieving sufficient development density. In addition to the performance limits identified in BC’s proposed Carbon Pollution Standard, there is a prescriptive compliance path for homes to decarbonize one or more systems (Exhibit 4, right-most column). These homes may not have had an energy model developed, perhaps because they are in regions with fewer energy advisors (e.g., Northern, and remote communities) compared to urban centres. The decision to include the prescriptive path was informed by feedback from these communities, who indicated that access to energy advisors and some high-performance building materials could be challenging. Performance Limits: Buildings Performance limits for the operational emissions from buildings are typically normalized by floor area in kg CO2e/m2/year (e.g., BC, Vancouver, Toronto, France, and New Zealand13). Exhibit 5 provides an example of tiered performance limits for new buildings in BC’s proposed Carbon Pollution Standard. In some jurisdictions (e.g., UK, Washington, Seattle, Town of Ithaca14), operational emissions limits are expressed relative to a modelled reference building. In Denmark, both operational and embodied carbon are included in one life cycle carbon GHG intensity limit. 13 New Zealand’s “Transforming Operational Efficiency Framework” is not yet in force. 14 Some jurisdictions, including the Town of Ithaca, have multiple compliance paths. 10 Exhibit 5: Performance Limits for New Buildings in BC’s Proposed Carbon Pollution Standard Prescriptive Pathways: Buildings Two prescriptive compliance paths for operational emissions were identified for buildings: a points- based path, and a path that explicitly bans fossil fuel use (discussed in Section 3.1). In addition to a performance compliance path, the Ithaca Energy Code Supplement has a prescriptive operational emissions compliance path for new buildings, where six points are required for compliance. Points can be earned under the following categories: efficient electrification, affordability, renewable energy, and other (e.g., development density, walkability, EV parking spaces, etc.). For example, two points are awarded for air source heat pumps for space heating, one point is awarded for installing heating systems in directly heated spaces, up to three points are awarded for on-site or off-site renewable electric systems or on-site renewable thermal systems, and one point is awarded for achieving sufficient development density. Most points represent roughly 6-10% GHG savings relative to IECC 2016. 2) Methods to Normalize Performance Limits Operational emissions from homes and buildings are impacted by many factors in addition to design choices. In addition to normalizing by floor area, two other methods to normalize performance limits were identified: by region and by home or building typology. Normalize by Region In some regions (e.g., Seattle, Washington State, the UK) operational emissions limits for a new home or building are determined relative to a modelled reference home or building. This means that the home or building’s specific location and climate data are accounted for in the calculation of its operational emissions. Several jurisdictions including BC, Denmark, and New Zealand, list operational emissions limits and grid emissions factors for the entire province or country, and so do not account for regional variation of space conditioning loads due to climate. The province of BC completed archetype modelling of homes and buildings to highlight potential technical implications of the proposed tiered carbon pollution standard. They found that the ability to meet operational emissions limits did not depend substantially 11 on climate zone. Instead, ability to meet limits was more dependent on the effective use of low-carbon fuels. For these reasons, the province has proposed one set of limits for all climate zones15. Normalize by Typology: Buildings Performance operational emissions targets are presented by building typology in BC, Vancouver, and Toronto. For example, the Toronto Green Standard lists separate normalized limits in kg CO 2e/m2/year for commercial offices and commercial retail, and BC’s proposed Carbon Pollution Standard lists separate limits normalized by floor area for hotels and motels, other residential occupancies, offices, and other business and personal service or mercantile occupations, as shown previously in Exhibit 5 on page 10. In contrast, performance limits in New Zealand’s Transforming Operational Efficiency Framework are presented for all buildings over 300 m2. Normalize by Typology: Homes No examples of operational emissions limits that vary by home typology (e.g., detached, semi-detached, row/town home) were identified in the jurisdictional review. However, BC’s proposed Carbon Pollution Standard lists two performance options for homes, one ideal for small homes (an absolute limit), and one ideal for large homes (an absolute and a normalized limit). 3) Communication of Future Limits A common theme from the jurisdictional review and interviews was increasing stringency of operational emissions limits over time towards net zero emissions for homes and buildings. These limits were communicated early so that industry would have time to prepare for the changes. 3.3 Complementary Requirements This section summarizes findings from the jurisdictional review and interviews for complementary requirements under the following headings: EV-readiness, demand response, and renewable energy generation. Detailed findings by jurisdiction for these research areas can be found in the companion MS Excel spreadsheet entitled “Appendix A - Overview Table.” EV-readiness A recurring requirement for new homes and buildings in many jurisdictions was either EV-ready spaces or EV-capable spaces (i.e., requirement to have electric vehicle supply equipment installed or a raceway to accommodate a decided 208/240-volt branch circuit). For example, in California’s Green Building Standards code for homes, electric vehicle supply equipment must be installed in new homes with private garages. Further, each new dwelling unit must have a raceway to accommodate a dedicated 208/240-volt branch circuit. Exhibit 6 summarizes where policies to support electric vehicle and solar infrastructure in buildings are adopted in the United States. 15 Building and Safety Standards Branch, “Draft Building Carbon Pollution Standards for Part 3 buildings in British Columbia,” B.C. Public Review, 21-Sep-2022. [Online]. Available: https://www2.gov.bc.ca/gov/content/industry/construction-industry/building-codes-standards/bc-codes/public- review. [Accessed: 12-Nov-2022]. 12 Exhibit 6: State and Local Electric Vehicle and Solar Building Requirements16 For new buildings, a common proposed requirement was that a percentage of parking spaces must be EV capable or EV ready, and in some jurisdictions, there is a requirement for level 2 EV charging readiness. The percentage of EV-ready or EV-capable spaces commonly varied based on building occupancy type. For example, the proposed 2021 Washington State Energy Code17 will require that 10% of total parking spaces have EV charging stations for buildings for most occupancy groups, while 25% of total parking spaces will have to be EV-ready for MURBs, hotels and motels18. EV requirements are found in several different legislative structures. Some jurisdictions include them in the Building Code, (e.g., Massachusetts and California). Some jurisdictions include them in Zoning bylaws or Land Use Codes (e.g., Seattle). Some jurisdictions include them in separate EV specific legislation altogether (e.g., France, England). Demand Response Examples of demand response requirements identified in the jurisdictional review and interviews include:  In Seattle’s upcoming energy code for buildings, electric storage water heaters meeting certain criteria must have demand responsive controls19.  The NY Energy Stretch Code states that new buildings must comply with at least one additional power distribution system package. The demand response option requires interoperable 16 “DOE Building Energy Codes Program Infographics,” Building Energy Codes Program, 2022. [Online]. Available: https://www.energycodes.gov/infographics. [Accessed: 10-Nov-2022]. 17 Effective July 1, 2023 18 Occupancy group R. 19 With some exceptions, will apply to electric storage water heaters with rated water storage volume between 40 and 120 gallons and a nameplate input rating equal to or less than 12kW. 13 automated demand-response infrastructure that can receive demand-response requests from the utility, electrical system operator, or third-party DR program provider, and of automatically implementing load adjustments to the HVAC and lighting systems.  The NBI’s Building Decarbonization Code presents optional demand response amendments to the 2021 IECC (for homes and buildings) or ASHRAE 90.1 (for buildings) covering all-electric and mixed-fuel scenarios. Specific optional amendments covering thermostatic controls, electric storage water heaters and lighting can be found in the companion MS Excel spreadsheet.  The US DOE and PNNL Stretch Code “Technical Brief on Demand Response in Residential Energy Code” proposes demand response controls for thermostats and electric storage water heaters with capacity greater than 76 L in new homes. Some interviewees expressed concerns about whether demand response “ready” control requirements would be obsolete when ready to be used. An interviewee from New York City explained that requirements for energy storage-ready spaces were difficult to implement because the City’s Fire Code has extensive requirements for fire suppression systems in energy storage spaces. Renewable Energy Generation Renewable energy generation requirements were identified in the United States (NBI’s Building Decarbonization Code for buildings), California (CALGreen 2022 for buildings), Santa Monica (for buildings), New York City (Local Laws 92 and 94 for homes and buildings), Seattle (for buildings20), and Denmark (BR18 for buildings). These requirements were generally expressed as minimum energy production per area of conditioned floor space, although in New York City, Local Laws 92 and 94 of 2019 mandate that at least 4 kW of solar PV generating capacity must be installed. Additional state and local solar building requirements are identified on the map in Exhibit 6 on page 12. Interviewees from New York City and Seattle explained these laws have been difficult to implement because of space limitations on the roofs of new homes and buildings in the city’s dense urban environment. The interviewee from Seattle indicated a solution to this could be flexibility for offsite renewable energy, but there are difficult questions in terms contractual attachments. A renewable energy generation requirement was noted in Marin Country, where new restaurants larger than 8,000 ft. sq and with service water heaters rated 75,000 BTU/h or more must install a solar water heating system with a minimum solar savings fraction of 0.15. A representative from the United States explained that the 10th edition21 of the Massachusetts Energy Code contains solar-ready provisions. They further explained that in New Jersey, warehouses, and buildings with more than 10,000 ft2 of floor space must be PV-ready, and that as of January 1, 2023, in New Castle Country Delaware, Ordinance 22-091 requires a solar ready zone on rooftops of new buildings with footprints of 50,000 ft2 or more. Renewable energy generation is listed as voluntary in many jurisdictions, including Toronto (Toronto Green Standard for homes and buildings), the United States (IECC for homes and buildings), the Town of Ithaca (Ithaca Energy Code Supplement for homes and buildings), Marin County (Title 19 Marin County Building Code for homes), Washington (Washington State Energy Code for homes and buildings), New 20 On-site renewable energy generation systems are not required for affordable housing projects. Other buildings can transfer their obligation to an affordable housing project. 21 Effective January 1, 2023 14 York (Stretch Energy Code for homes and buildings), the UK (Buildings Regulations 2010), France (RE2020 for homes and buildings), and the EU (EPBD). 3.4 Flexibility Mechanisms This section explores flexibility mechanisms identified in the jurisdictional review and interviews as they pertain to on-site renewables, carbon offsets, and all-electric requirements. On-Site Renewables to Meet Operational Emissions Limits Several references to the use of on-site renewables to meet operational emissions limits were identified through the interviews:  According to an interviewee from Denmark, on-site renewables can be included in the calculation of a building’s operational emissions, but only up to 25% of the total energy demand to ensure efficiency is prioritized over renewables.  The Toronto Green Standard states that incorporation of renewable energy production and/or connecting to an existing low carbon district energy system is strongly encouraged to reduce or avoid carbon emissions and to meet the operational emissions limits for buildings.  The US DOE and PNNL Stretch Code states that the installation of site-based renewable systems, typically PV panels that use site-available solar energy sources can offset imported metered energy into the building.  The City of Vancouver’s Energy Modelling Guidelines, which provide clarity on energy modelling inputs for compliance with the VBBL, state that on-site renewables can be used to positively impact the emissions factor for electricity for homes and buildings. The more on-site renewables used (up to 7%), the greater the reduction in the emission factor. BC has followed this methodology in its proposed Carbon Pollution Standard.  The Town of Ithaca’s points-based prescriptive compliance path awards up to three points for on- site or off-site renewable electric systems, or on-site renewable thermal systems in homes and buildings. An interviewee from the Town explained that off-site renewables were challenging to accommodate because they required contracting and financial expertise. They further explained that renewable energy systems were not a popular points path. Emerging codes such as the proposed IECC 2024 provide new methodologies to consider off-site renewables. Use of Carbon Offsets The Canada Green Building Council’s (CAGBC) Zero Carbon Building Design Standard states that qualifying, purchased carbon offsets can be used to offset direct or indirect emissions. In addition, renewable energy generated in excess of energy used and exported to the electricity grid is recognized as contributing to avoided emissions, if the associated renewable energy certificates are retained. The CAGBC’s Zero Carbon Building Design Standard is an optional compliance path to meet operational emissions targets for buildings in the Toronto Green Standard. No additional references to purchased carbon offsets were identified in the jurisdictional review. 15 Exceptions to All-Electric Requirements Several examples of flexibility mechanisms for all-electric requirements related to cooking and backup heating were identified during the interviews:  In Seattle, there has been no attempt to regulate gas use for cooking in new commercial buildings, or for decorative fireplaces. In the Washington State Energy code, gas backup heating is permitted for buildings primarily heated by electric heat pumps. An interviewee from Seattle explained that this was a compromise to reassure stakeholders who expressed concerns about cold weather heat pump performance, and grid blackouts.  In New York City, gas heating can be used for emergencies, and there is an exception for gas use for cooking in new commercial buildings, but not in new homes.  In the Town of Ithaca, gas cooking is permitted, but interviewees explained this will be revisited. They noted that stakeholders have a ‘knee jerk reaction’ to all-electric requirements for cooking in new homes and buildings. In addition, the proposed BC Carbon Pollution standard addresses renewable natural gas (RNG). The proposed standard accommodates RNG and other innovative fuel sources as they become available. As of August 2022, a proposal from FortisBC to introduce RNG at scale is before the BC Utilities Commission, an independent government agency responsible for regulating BC’s energy utilities. 3.5 Choice of Emissions Factors There are many ways to calculate emissions factors, and these factors fluctuate through time as electricity supply grids are decarbonized. No variation of operational emissions limits based on regional grid emissions factors was observed. Several interviewees explained that simplicity was prioritized in establishing emissions factors for their carbon codes, especially for the first iteration of the code. For example, BC has proposed to adopt emissions factors set by the City of Vancouver’s Modelling Guidelines. This means one emissions factor for electricity for all of BC, regardless of whether a home or building is connected to the Integrated grid or the Fort Nelson grid, which has substantially higher emissions. Representatives from BC felt this was the simplest approach for the province and explained that it provided certainty and stability to industry. Similarly, one emissions factor for electricity is used for all of Washington State. The representative from Seattle explained that the same carbon factor for electricity is used for the entire state of Washington, even though the fuel mix varies from one utility to the next. They further explained that localized factors could have been used, but this approach would have added complexity. An interviewee from the UK explained that the same monthly carbon factors are used in England, Wales, and Scotland. These factors reflect realistic annual variation in the grid energy mix, which means that energy use in the winter is more carbon intensive than at other times of year. London (UK) government policy on whole lifecycle assessment requires the use of emissions factors from the ‘Future Energy Scenario: Steady Progression.’ This is the most conservative of several grid decarbonization scenarios published by National Grid. The emissions factor for electricity used in the Ithaca Energy Code Supplement came from the average baseload emission factor provided by the US EPA for upstate New York. They decided to use the same emissions factor from 2018 through to 2024, which was a point of contention during the industry consultation. One commenter wanted the marginal emission factor rather than average baseload 16 emission factors to be used to consider peak emission. While another commenter had evidence that the EPA natural gas emission factors should be much higher due to fugitive leaks. However, interviewees explained that ultimately, they used their best judgment and chose what seemed fair. 3.6 Importance of Consultation in Carbon Code Development Process Several interviewees highlighted the importance and benefits of public and industry consultation during their carbon code development processes. Representatives from the City of Toronto attributed lack of pushback from industry regarding the Toronto Green Standard requirements in part to industry’s involvement in the open and transparent development of the energy and emissions requirements. Representatives from BC echoed this comment; they explained that a broad range of industry representatives were consulted during the development of the proposed Carbon Pollution Standard, with a goal to limit future re-work. Other interviewees viewed stakeholder consultation as an opportunity to educate and connect with the people who will be impacted by new regulations. A representative from Seattle reported that stakeholder consultation was an opportunity to share information and to demonstrate a willingness to support industry through transition periods. An interviewee from New Zealand recommended being aware of the broader issues stakeholders may be facing in the development of regulations and prior to the consultation process. For example, in New Zealand, some industry representatives resisted the proposed Operational Efficiency Framework, which could have been fuelled by supply chain issues around timber and plaster board. 3.7 Evidence-Based Carbon Code Development A theme that emerged from the interviews was the value of evidence-based, transparent carbon code development. Pre-feasibility studies or energy modelling was completed in several jurisdictions to ensure carbon code requirements were feasible and/or cost-effective prior to publication. This type of ‘proof of concept’ work was completed for individual home and building archetypes, and in some cases, a broader grid readiness study was completed. Several interviewees also explained that developers appreciated a stable and predictable building code so that they could clearly understand the implications for their project pipelines. In addition, several interviewees noted that affordability was deliberately considered during the development of carbon code requirements in their jurisdictions. Technical Feasibility and Cost-Effectiveness Examples of evidence-based carbon code development to demonstrate technical feasibility and cost- effectiveness include:  As part of the development of the BC Carbon Pollution Standard, the province completed archetype modelling of Part 3 and Part 9 buildings across BC’s climate zones to show whether decarbonizing a hypothetical building or home would be cost-effective. This modelling showed 17 examples of how buildings and homes could meet the proposed operational emissions limits. Additionally, the modelling informed the operational emissions limits by building type22.  The Toronto Green Standard operational emissions limits for part 3 building were established through an extensive two-part study completed between 2015 and 2017 of energy codes around the world, and a parametric and costing analysis of the most common part 3 building types expected to be built to 2040. Additionally, a study23 was completed to benchmark embodied emissions in Part 3 buildings for Ontario as the basis for future policy development.  New York City’s Local Law 154 is based on a phased timeline that accounts for whether electrification requirements have been proven feasible depending on the building size. For example, as of January 2024, 1-2 family homes and all other buildings less than seven stories are prohibited from combusting fossil fuels for space heating, but the compliance dates for buildings seven stories or more is not until July 2027. This is because feasibility has not been fully demonstrated for large buildings. NYC has commissioned heat pump and grid reliability studies to be published mid-2023 to inform feasibility. They have high confidence that homes and low-rise buildings can be heated with heat pumps, but for taller buildings, there are concerns around space and where the condensing part of the heat pump would go.  The Town of Ithaca used real data from 10-20 new buildings to inform a baseline for their Prescriptive Compliance Path scoring. Then they stress tested the Prescriptive Compliance Path requirements using actual building data to ensure they were feasible. Then they made tweaks to ensure feasibility while also achieving an impact.  Seattle City Light commissioned a grid readiness study that concluded the power generation system could handle full electrification, with the understanding that several local distribution facilities would likely need to be augmented. An interviewee from Seattle said that the grid readiness study arrived at this conclusion even without factoring in any demand flexibility or significant progress on codes or other regulations, which instilled confidence in stakeholders.  The Netherlands used data collected during an embodied carbon reporting requirement phase to later inform limits for homes and offices24. Before lowering the embodied carbon limit (referred to as the single-score indicator) from 1.0 to 0.8 for new homes and office buildings, code officials analysed how many new buildings would comply. The limit was ultimately selected to ensure a high compliance rate that wouldn’t push industry beyond ‘reasonable levels’ or building quality issues.  In France, data from 1,215 buildings was collected between 2016 to 2020 to test the methodology and limits for the life cycle analysis. In 2019, a targeted consultation took place to refine the limits 22 Building and Safety Standards Branch, “Draft Building Carbon Pollution Standards for Part 3 buildings in British Columbia,” B.C. Public Review, 21-Sep-2022. [Online]. Available: https://www2.gov.bc.ca/gov/content/industry/construction-industry/building-codes-standards/bc-codes/public- review. [Accessed: 12-Nov-2022]. 23 “Ontario's first benchmarking of embodied carbon for large buildings,” Mantle Developments, 13-Sep-2022. [Online]. Available: https://mantledev.com/publications/ontarios-first-benchmarking-of-embodied-carbon-for- large-buildings/. [Accessed: 12-Nov-2022]. 24 Some jurisdictions introduce a reporting requirement as a steppingstone towards a future prescriptive or performance requirement. 18 and calculations before limits were established. Lastly, modelling was completed using real building data to establish ambitious but attainable limits for embodied carbon and operational GHG emissions.  In the UK, they use a large database of historical Energy Performance Certificates (EPCs) and Display Energy Certificates (DECs) to inform target emissions rates, and complete feasibility studies to confirm targets are realistic and cost-effective.  An impact assessment was completed in the development of Finland’s low-carbon construction roadmap to limit the carbon footprint of new buildings by the mid-2020s. Affordability (Upfront and Operational Costs) Studies were commissioned in several jurisdictions to ensure that carbon code requirements were affordable and available, with most having cost increases within an acceptable limit. Interviewees from the UK and the Netherlands indicated that their codes have impact on the cost of construction. The most progressive carbon codes, for example the London Future Standards and the French RE 2020 had an impact of about 10% and 3-15% respectively on costs of construction. An interviewee from Seattle said they received vigorous but predictable arguments from certain industries related to the housing affordability crisis and clean electricity availability. However, studies commissioned found that these arguments were inaccurate and played a key role in alleviating industry concerns. Specifically, savings in gas infrastructure, energy efficiency savings of heat pumps over gas counterparts, and indicators that gas prices will increase were mentioned as alleviating upfront and operational costs. An interviewee from Toronto also mentioned business models from energy providers (i.e., third party utilities) were helping to mitigate upfront costs. The Town of Ithaca addressed affordability through their prescriptive compliance path for homes and buildings by awarding ‘Affordability Improvements’ points for specific design choices. Up to six of six compliance points can be awarded to buildings for smaller building or room size (for hotels and residential portions), installing heating systems in directly heated spaces, efficient building shape, reducing over lighting and implementing other lighting improvements, and for a modest window to wall ratio. For homes, up to five of six compliance points can be earned for affordability improvements. These points can be earned for the same design choices as buildings, except that no points are awarded for lighting improvements. These affordability measures aren’t traditionally accounted for in reference-based energy modelling but result in GHG savings. Several interviewees also mentioned that cost and affordability concerns are largely driven by factors that have nothing to do with energy or carbon code requirements, such as inflation and supply chain issues brought on by the COVID-19 pandemic. Once carbon codes are in place, the interviewees found that industry quickly adapted and innovated, but only if required to. New York City went ahead with a gas ban (Local Law 154) prior to completing costing studies to meet Paris Climate commitments. Their costing studies will determine if funding or incentive mechanisms will be required to support industry, rather than using the costing study to validate the gas ban requirement. Similarly, Washington State law has been updated so that instead of traditional cost-effective studies which require demonstrating upfront costs and payback periods to validate the code change, the requirement for analysis was changed to demonstrate that 2050 Paris Climate agreement targets 19 would be met the most cost effectively. In that sense, it costs much less to incorporate carbon requirements in new buildings rather than after the fact. In Europe, where advancement on carbon life cycle analysis is much more pronounced, affordability conversations centre on lean building, material and spatial efficiency, and promoting reuse and refurbishment over new builds to deliver affordable GHG mitigation or reductions. 3.8 Enforcement and Unintended Consequences Interviewees were asked about carbon code enforcement and penalties for non-compliance. They explained that carbon codes are enforced similarly to building codes, and that the same staff will be tasked with ensuring both types of compliance. An interviewee from Toronto indicated there is no appreciable difference in the level of effort required to review applications since the introduction of operational emissions limits requirements. Development review costs are largely a function of application complexity and overall application volume. An interviewee from New York City indicated that given the local law’s functional gas ban, enforcement will be straightforward since you cannot install gas infrastructure without a permit. Prescriptive gas ban reduces red tape as compared to modelled requirements. An interviewee from New Zealand expressed concerns in asking code enforcement officials to review and approve embodied carbon assessments. This task would beyond their current expertise and add to their heavy workloads. Penalties for non-compliance with carbon code requirements include holdbacks on approvals, permits and/or occupancy certificates, or monetary fines. A handful of interviewees also identified unintended consequences of carbon code requirements. These include:  The operational emissions limits for buildings in the Toronto Green Standard, which imply fuel switching to electricity, have presented technical challenges for designers in Toronto’s dense, high rise urban environment. The requirements have exposed knowledge gaps. However, the interviewee noted that City monitors how industry is affected by requirements, and that industry has responded to all cycles of the TGS.  An interviewee from The Netherlands remarked that attention should be paid to ensure that carbon and energy codes don’t work against each other. They explained that an unintended consequence of requiring additional insulation in the energy code led to a higher embodied carbon impact. 3.9 Challenges Faced to Establish Embodied Carbon Policy While some Canadian and many international jurisdictions have established operational GHG emissions limits, fewer have embodied carbon requirements in place. Jurisdictions surveyed as part of this study with embodied carbon requirement in force include France (for new homes and multi-unit residential buildings), The Netherlands (for new residential and office buildings over 100 m 2), and Marin County (for cement in new homes and buildings). The jurisdictional review and interviews revealed that embodied carbon limits are planned additions to carbon codes in BC, the City of Vancouver (for Part 3 buildings), New York City, Finland, Denmark, New Zealand, the UK, and in the European Union’s EPBD. More details 20 on the status and scope of embodied carbon policy in Europe is available in One Click LCA’s October 2022 report entitled “Construction Carbon Regulations in Europe - Review and Best Practices 25.” Interviewees cited several challenges associated with the development and introduction of embodied carbon policy:  Scope and Method: o Module Inclusion (A, B, C, D): Some regulations require a whole life cycle assessment, some require a simplified whole life cycle assessment, and others are limited to upfront carbon (A). An interviewee from New Zealand reported that it was challenging to establish the boundary for what life cycle stages to include in an embodied carbon policy. They considered only regulating up front embodied carbon (A) and excluding use stage (B1-B5), end of life carbon (C) and beyond initial life cycle (D) to reduce complexity. However, they received feedback this would be a mistake as it could encourage the use of low embodied carbon products that require frequent replacement or maintenance. An interviewee from the UK noted that several stakeholders insist that policies try to reuse existing buildings or materials before constructing new buildings or using new materials. A building scale approach using whole building life cycle will allow consideration for reuse, geometry, and material efficiency. An interviewee from The Netherlands noted that inclusion of Stage D (reuse, recovery, and recycling) and the accounting of recycling before it takes place is advantageous to steel products. Biogenic material stakeholders in the Netherlands prefer to aim requirements at stage A, given their immediate impact. Currently in the Netherlands, the requirements do not limit material type, but require leaner material use. o Building Component Inclusion or Exemptions: Regulations also differ when it comes to the inclusion of building components. Some regulations will focus on the elements that cause immediate major impacts while others will cover the entire building including all primary elements: envelope, mechanical, electrical and plumbing equipment, superstructure, substructure and finishes. In the UK’s Part Z proposal for buildings, mechanical, electrical, and plumbing components are included (as denoted by “Services” in Exhibit 7), and the interviewee 25 “Construction Carbon Regulations in Europe - Review and Best Practices, One Click LCA, October 2022. [Online]. Available: https://www.oneclicklca.com/wp-content/uploads/2022/10/EU-Regulations-Review-Ready-to- Publish.pdf?vgo_ee=MiYl9q70OFwiSV%2BWRRe3t76UuXqK4oj9zpWcE5%2FJs8s%3D. [Accessed: 10-Nov-2022]. 21 suggested that over a 60-year life, it can create similar carbon impacts as structural components since it must be replaced over several cycles. Exhibit 7: Embodied Carbon Breakdown by Component o The Treatment of Sequestered Carbon: There was recognition that there is a significant level of sensitivity surrounding the allowance of credit for sequestered carbon. Some countries have a requirement to report biogenic material separately, while France allows subtraction of biogenic carbon from A1-A3 to achieve their carbon limits. By 2031, France’s carbon limits will generally encourage wood structures, or low carbon concrete structure or wood mixes with additional optimisation (refrigerant replacement, low-carbon materials, efficient geometry, etc.). In France, they also have a “dynamic” methodology that considers earlier carbon release as more harmful, which further encourages bio sourced materials. In the UK, proposed Part Z legislation would only require biogenic material to be reported. The interviewee explained that timber is mostly imported and there are concerns for monocultures and deforestation. The Netherlands’ EN15804 methodology version in use does not allow credit for biogenic material.  Complexity: Several interviewees cited concerns around the complexity of embodied carbon requirements. An interviewee from New Zealand felt that embodied carbon methodology needed to be accessible and understandable for the intended audience. An interviewee from the Town of Ithaca felt that when the IECS was in development (2018), embodied carbon requirements represented a heavy lift to catalogue building material documentation. Focus was instead placed on an adaptive reuse option in the points-based prescriptive code which awards one point for substantial re-use of an existing building for a different use. 22  Data Availability: Some countries have extensive environmental product databases to support embodied carbon calculations for new homes and buildings. For example, France’s INIES database was created in 2004, and The Netherlands’ National Milieu Database was created around the beginning of the 21st century. However, interviewees from the UK and New Zealand explained that there was a lack of EPDs to support an embodied carbon policy in their jurisdictions.  Tools and Training: Lack of tools and training to support industry around an embodied carbon policy was cited as a challenge by several interviewees. In the UK, Part Z legislation on embodied carbon is in front of the government for approval, but tools and training have not yet been developed to support industry. 23 4 Options Assessment for Future Carbon Codes This section presents the options assessments for homes and buildings, informed by findings from the jurisdictional review and interviews. The options assessment focuses on requirements related to operational carbon, fuels, and electrification, and will serve to inform the development of future carbon code requirements in Canada. In addition to the options presented for homes and buildings in sections 4.1 and 4.2, overarching options that emerged from the jurisdictional review and interviews were for initial carbon codes to be simple and achievable, with increased complexity and stringency being introduced over time. For example, France’s RE2020 introduces limits for homes, MURBs, offices and education buildings, rather than for all building types as of January 1, 2022. Toronto’s Green Building Standard is currently on version 4, with version 5 expected in 2025. As the standard has evolved, additional and more stringent requirements have been introduced. Tiered (stepped) operational emissions limits were also identified in more than one jurisdiction (e.g., BC, Toronto, New Zealand), which lay out a performance trajectory so that industry can plan accordingly. 24 4.1 Homes The options assessment for homes focuses on requirements related to operational carbon under the categories presented in Exhibit 8. The option identified as common practice for each category based on results of the jurisdictional review is identified in bold font. For example, the common practice under the variation of operational emissions limits by home size category was ‘none’. Exhibit 8: Options Assessment for Homes Category Options Examples Considerations Structure of operational emissions limits  Absolute limit  Intensity limit normalized by floor area  Comparison to a modelled reference home  Prescriptive requirement to decarbonize space heating and/or water heating systems  Prescriptive points-based system  BC: 1050 kg CO2e/home for GHG emission level 1 (medium).  France: 160 kg CO2e/m2/home.  UK: ‘target emissions rate’ is calculated from energy performance and compared to a standardized home using the Standard Assessment Procedure.  VBBL: electric space space/water heating (prescriptive path).  BC: medium carbon, low carbon, and zero carbon ready compliance options.  Town of Ithaca: 3 points for air source heat pumps for space heating, 1 point for a water heating system that uses heat pumps.  Prescriptive requirements are simple for stakeholders to understand.  Intensity limits and limits compared to a modelled reference home are well-suited to homes with an energy model. Variation of operational emissions limits by home size  Compliance metric options  None  BC: 1050 kg CO2e per home26, or 6.0 kg CO2e/m2/year and 2400 kg CO2e per home26.  Normalizing limits by floor area or setting separate absolute limits for small homes versus large homes creates a more level playing field for homes of different sizes but adds complexity for stakeholders. 26 For GHG emissions level 1 (medium) 25 Category Options Examples Considerations  Common limits are a disadvantage to small homes with less conditioned floor area compared to larger homes. Variation of operational emissions limits by typology  Variation by typology (e.g., detached, semi-detached, row/town home)  None  No example of variation by typology identified.  Town of Ithaca: 6 points required for homes to comply with the prescriptive (easy) path.  Adds complexity for stakeholders.  Disadvantageous to detached homes.  No examples found in the jurisdictional review. Grid Emissions Factors  National (jurisdiction-wide)  Regional  Current  Future  Annual  Monthly  BC: one current emissions factor for electricity is used for the entire province, regardless of grid makeup.  UK: the same monthly emissions factors are used in England, Wales, and Scotland. These factors reflect realistic annual variation in the grid energy mix.  Washington: the same carbon factor for electricity is used throughout the state, even though the fuel mix varies by utility.  Regional emissions factors add complexity for energy modellers, builders and designers who may operate in more than one climate zone within a province or territory  National emissions factors are a ‘free pass’ for regions with a carbon intensive grid.  Future emissions factors are uncertain.  Monthly factors reflect realistic annual variation in the grid energy mix. Fuels27  Fossil fuels permitted  Fossil fuels banned  UK, France: fossil fuels permitted in new homes, but compliance is difficult if they are used.  Toronto: electrification not mandated but may be required by proxy in the Toronto Green Standard as operational emissions limits are lowered.  Town of Ithaca: fossil fuels are permitted, but 6 of 6 prescriptive path compliance points  Codes that allow fossil fuels provide flexibility for builders and designers.  Codes that ban fossil fuels provide clarity for builders and designers, and more certainty regarding GHG emissions impact than codes that permit fossil fuels. 27 No common practice emerged from the jurisdictional and interviews, as several examples of codes that permit and ban fossil fuels were identified. 26 Category Options Examples Considerations can be earned by electrifying space heating, water heating and cooking.  Petaluma, Fairfax, Alameda, San Jose, Santa Cruz, and Morgan Hill California: gas ban prohibits gas infrastructure in new homes.  New York City: combustion of substances that emit 25 kg or more of CO2e per million BTU of energy is not permitted. Therefore, natural gas, which emits approximately 50 kg CO2e per million BTU of energy is not permitted. Electrification  Electrification requirements  Electric-ready provisions  EV requirements  EV-ready provisions  Vancouver: electric space heating and hot water heating for most new low-rise homes.  US DOE and PNNL Stretch Codes: household ranges, cooking appliances, clothes dryers, and water heaters must be electric-ready28. Electric-ready circuits and water heater space is required.  California: electric vehicle supply equipment must be installed in new homes, and each dwelling unit must have a raceway to accommodate a dedicated 208/240-volt branch circuit.  No examples of EV requirements for homes were noted.  Electric and EV-ready provisions provide flexibility for the future if all-electric or EV requirements are introduced.  EV requirements ensure charging infrastructure is in place when construction is complete. 28 Electric-ready means that there is a sufficiently rated electrical receptable installed near permanently installed cooking equipment, appliances, clothes dryers, and water heaters. This assures a home built with gas or propane can easily accommodate future electric cooking equipment, appliances, clothes dryers, and water heaters. 27 4.2 Buildings The options assessment for buildings focuses on focuses on options related to operational carbon under the categories presented in Exhibit 9. The option identified as common practice for each category based on results of the jurisdictional review is identified in bold font. For example, the common practice under the variation of operational emissions limits by typology category was ‘variation by typology.’ Exhibit 9: Options Assessment for Buildings Category Options Examples Considerations Structure of operational emissions limits29  Intensity limit normalized by floor area  Comparison to a modelled reference building  Prescriptive points-based system  BC: 9.0 CO2e/m2/year for hotels and motels under medium GHG emission level.  UK: ‘target emissions rate’ is calculated from energy performance and compared to a standardized building using the Simplified Build Energy Model or other approved software tools.  Town of Ithaca: two points for using an air source heat pump; three points for using a ground source heat pump.  Toronto: Tier 1, Tier 2 (high performance), Tier 3 (near zero emissions), Net Zero Emissions.  Intensity limits and comparison to a modelled reference building is well-suited to buildings with an energy model.  Prescriptive requirements are simple for stakeholders to understand. Variation of operational emissions limits by typology  Variation by typology (e.g., office, retail, restaurant, etc.)  None  Toronto: 15 kg CO2e/m2/yr for offices; 10 kg CO2e/m2/yr for retail.  Denmark: From 2023 onward, whole-building CO2 emissions must be less than 12 kg/CO2e/heated square metre30.  Variation adds complexity for stakeholders.  Variation recognizes occupancy pattern and end-use intensity differences across building types. 29 Common practice was to mirror the structure for the presentation of energy use targets. 30 Includes building production and operation 28 Category Options Examples Considerations Grid Emissions Factors  National (jurisdiction-wide)  Regional  Current  Future  Annual  Monthly  BC: one current emissions factor for electricity is used for the entire province, regardless of grid makeup.  UK: the same monthly emissions factors are used in England, Wales, and Scotland. These factors reflect realistic annual variation in the grid energy mix.  Washington: the same carbon factor for electricity is used throughout the state, even though the fuel mix varies by utility.  Regional emissions factors add complexity for energy modellers, builders and designers who may operate in more than one climate zone within a province or territory  National emissions factors are a ‘free pass’ for regions with a carbon intensive grid.  Future emissions factors are uncertain.  Monthly factors reflect realistic annual variation in the grid energy mix. Fuels31  Fossil fuels permitted  Fossil fuels banned  Petaluma, Fairfax, Alameda, San Jose, Santa Cruz, and Morgan Hill California: natural gas ban prohibits gas infrastructure in new buildings.  New York City: combustion of substances that emit 25 kg or more of CO2e per million BTU of energy is not permitted. Therefore, natural gas, which emits approximately 50 kg CO2e per million BTU of energy is not permitted.  Codes that allow fossil fuels provide flexibility for builders and designers.  Codes that ban fossil fuels provide clarity for builders and designers, and more certainty regarding GHG emissions impact than codes that permit fossil fuels.  A code that prohibits gas use in buildings fosters innovation and promotes complementary requirements like renewable energy generation. Electrification  Electrification requirements  Electric-ready provisions  EV requirements  EV-ready provisions  Seattle: As of June 2021, heating in new buildings cannot be provided by electric resistance or fossil fuel combustion appliances (including natural gas, heating, oil, propane, or other fossil fuels).  Marin County: electric readiness or future proofing required if gas is permitted based on  Electric and EV-ready provisions provide flexibility for the future if all-electric or EV requirements are introduced.  EV requirements ensure charging infrastructure is in place when construction is complete. 31 No common practice emerged from the jurisdictional and interviews, as several examples of codes that permit and ban fossil fuels were identified. 29 Category Options Examples Considerations allowable exceptions. Buildings must have electric capacity for future electrification.  California: 10% of total parking spaces for MURBs, hotels, and motels must be EV charging spaces capable of supporting future Level 2 electric vehicle supply equipment. A-1 Appendix A Overview Table Results of the jurisdictional review are provided under separate cover, in a companion MS Excel spreadsheet entitled “Appendix A – Overview Table.” B-1 Appendix B Interviewee List Exhibit 10 shows the full list of interviewees, including their title, jurisdiction, organization, and email address. Exhibit 10: Interviewee List Contact Name & Title Jurisdiction Organization Email Scott Williams: Senior Codes Engineer British Columbia, Canada Building and Safety Standards Branch BC Government Scott.B.Williams@gov.bc.ca Tiffany Warkentin: Director, Building Policy & Legislation British Columbia, Canada Building and Safety Standards Branch BC Government Tiffany.Warkentin@gov.bc.ca Lisa King: Senior Policy Planner Toronto, Canada City of Toronto Lisa.M.King@toronto.ca David MacMillan: Program Manager Toronto, Canada City of Toronto David.MacMillan2@toronto.ca Duane Jonlin: Energy Code and Energy Conservation Advisor Seattle, USA City of Seattle Department of Construction and Inspections duane.jonlin@seattle.gov Emily Hoffman: Director of Energy Code Compliance New York City, USA New York City Department of Buildings Office of Sustainability emhoffman@buildings.nyc.gov Nick Goldsmith: Sustainability Planner Town of Ithaca, New York, USA Town of Ithaca NGoldsmith@town.ithaca.ny.us Ian Shapiro: Special Consultant Town of Ithaca, New York, USA Taitem Engineering imshapiro@taitem.com Darren Port, Codes and Standards Manager Northeastern United States Northeast Energy Efficiency Partnerships dport@neep.org B-2 Meredydd Evans: Senior Staff Scientist United States Pacific Northwest National Laboratory m.evans@pnnl.gov Erik Mets: Building Scientist United States Pacific Northwest National Laboratory erik.mets@pnnl.gov Anne Svendson: Special Advisor Denmark Danish Energy Agency ansv@ens.dk Matti Kuittinen: Senior Ministerial Advisor Finland Ministry of the Environment Department of the Built Environment Matti.Kuittinen@gov.fi Jos Verlinden: Senior Policy Advisor The Netherlands Ministry of the Interior and Kingdom Relations Directorate-General Housing and Building Jos.Verlinden@minbzk.nl Dirk Breedveld The Netherlands Ministry of the Interior and Kingdom Relations Directorate-General Housing and Building Dirk.Breedveld@minbzk.nl Ivan Jovanovic: Technical Director UK Atelier Ten ivan.jovanovic@atelierten.com Louis Bourru: Director of Low Carbon Buildings Projects France Cerema louis.bourru@cerema.fr Katie Symons: Principal Advisor, Engineering New Zealand Building Performance and Engineering Building System Performance Ministry of Business, Innovation & Employment Katie.symons@mbie.govt.nz