Terry Gerton Housing affordability is a big concern, certainly a topic of conversation across the country, so much so that Congress recently passed legislation to try to address some issues in the housing market. Your department has recently analyzed the latest International Energy Conservation Code and concluded it could significantly increase construction costs. So start with what prompted DOE to take a closer look at those proposed standards?

Audrey Robertson Sure, Terry. Well, under the Office of Critical Minerals and Energy Innovation, we also cover building technologies, which allows us and really requires us to be the government entity that looks at everything from appliance standards to building codes. Now, building codes in the United States are actually designed by a third party called the International Code Council and then adopted by states. So it is in a multi-year, two to three-year cycle. So the most recent set of proposed rules when I became the assistant secretary and this responsibility became my responsibility, we decided to really look at the data and everything under Secretary Wright and President Trump is about transparency here in the Department of Energy. We are numbers-focused, we are data-focused. And then trying to understand how these new codes were developed and why. We asked for an understanding of the data and there are certain things that jumped out at me, specifically things like the first cost of implementing a new code was never considered that the payback on some of the codes that had been enacted were well beyond the life of someone owning a home, 22 years, 40 years, the average across this new COVID standard is 11 years. And that’s using assumptions that frankly needs some better support if they’re gonna move forward with that. Now, the set of standards and assumptions that are used to validate codes and develop them is really done by this third party. And the Department of Energy, historically, uses our resources to take the information that is provided and provide information back to them. And in looking at how that data impacted Americans, we were shocked. Specifically, you can go on to the Department of Energy website. We have a map and you can click and see if your state adopts these building codes. The dollar increase in construction, the years of payback, these are just numbers. These are numbers that impact every American that’s trying to buy a house today. And the concern we have is that The building codes being proposed are not creating value. They’re not saving a material amount of energy. And more importantly, according to the National Association of Home Builders, have increased the price of housing by 26% across the nation. That is astronomical.

Terry Gerton Are there specific aspects of the code, shingles or siding or double layer windows? Are there particular aspects that are of most concern to you that are driving these costs?

Audrey Robertson There’s a combination of them. And you pointed to some, but it’s really the way the code system has reshaped itself, where every building, every home has to hit a certain number for efficiency. But the only way you hit that number is by putting in a heat pump, or using an electric dryer instead of a gas dryer, or putting insulation in your roof that won’t pay back for a hundred years. So the only way to hit your envelope efficiency mandates is by force fuel switching, inefficient — I should say ineffective and costly upgrades. And here’s the thing, I am all about, if you wanna put in a gas dryer, absolutely. If you wanna to put in R40 insulation in your ceiling, absolutely, but the role of the government and the federal, the adoption of these codes is to provide the data and be lucid about setting the baseline. Baseline codes should be about safety and minimum efficiency. What these codes have been doing is truly weaponizing efficiency standards to affect political goals versus what it’s supposed to be doing, which is taking care of the American people.

Terry Gerton Audrey Robertson is the assistant secretary of energy in the Office of Critical Minerals and Energy Innovation at the Department of Energy. So Ms. Robertson, at the heart of this debate really seems to be a simple question. When does an efficiency requirement stop being a good investment for the homeowner? So how does DOE think about that and what message are you communicating to the American market?

Audrey Robertson Listen, we’re about consumer choice and affordability. And so at what point does an efficiency mandate make sense for the American people when it delivers real value, real energy, tangible energy efficiency savings, and it doesn’t limit consumer choice? When a building code increases the price of a home and is not something that that homeowner wants, and it doesn’t create any meaningful benefit for us as Americans, that is not a code that should be in place. Now, individual states have the option to adopt codes or not adopt codes. One of the challenges we have, and one of the goals that our office has today is to provide that transparency so that state and community energy officers can make decisions around what codes they are putting into place for their community, understanding the trade-offs. Back to my first comment about codes. Historically, this International Code Council has not taken into consideration the first cost of what implementing that code will be. So if your insulation is now gonna be $10,000 more on your $400,000 home, they don’t consider that. They only consider the energy savings from that insulation. All of those numbers should be transparent. All of them should be accessible. And at the Department of Energy, we are working, fighting tirelessly for the American people for transparency, consumer choice and especially the impact on affordability in housing.

Terry Gerton It seems like perhaps there’s been a change in how the ICC is developing and promulgating building codes. Could you kind of walk us through how that process works?

Audrey Robertson Absolutely. Well, the ICC’s code development process today is dominated mostly by industry with very minimal consumer representation, or the consideration of what I mentioned earlier, which is upfront costs. Even state energy officials no longer have input. Since 2021, the ICC really lost control of the code development process as it shifted to a new approach that disenfranchised the state and local officials who previously had authority over what ultimately went into the energy codes. And since that time, the ICC faced a series of appeals. It has struggled, in our view, to find footing on code development. And in the process, they abandoned the traditional focus on energy efficiency and they truly lost track of consumer interests. I sent a letter to the ICC earlier this year and urged it to refocus its code development process on the key tenants that we believe are not only our job, but are critical, which is affordability, transparency, fuel neutrality, and having a consumer choice component to what they’re doing. But the ICC insisted on pushing forward with things like onsite energy generation and electrical vehicle infrastructure, essentially avoiding greenhouse gas emissions. At the home only to shift to electricity, which shifts greenhouse gas emissions. They were focused on things that every American might not be focused on, but in doing so, increasing the cost of your home. So we have really tried to work with ICC to put in place a cost analysis and a criteria that lays out what these costs will mean for Americans. And they have said in this cycle, for the codes that they would like for every American to adopt and every state to adopt next year, for those codes, they are absolutely unwavering and they’re not going to change their process.

Terry Gerton DOE has requested input on how it evaluates affordability and cost effectiveness in the building energy codes. As that work continues, what principles are you looking at to guide future building standards so that they continue to meet those objectives that you just laid out?

Audrey Robertson Yeah, well, thank you for bringing that up. I think we have just another week or two left where we’ve really gone out to the community and put this request for information out to understand how other people are thinking about these issues. Historically, ICC is the code. They are the folks that develop this. As we look to develop model code alternatives that identify low-cost strategies that allow you to comply, be fuel neutral. And actually allow for consumer choice and preserve affordability, that is what we’re trying to do. And that’s what we are trying to, frankly, just seek information on. We don’t think it would be very beneficial as a government entity to just say what they’re doing is very bad and not look at what could be done. We have gone to them and tried to offer suggestions, ideas, and ways to modify what they’re doing, and in this cycle of their code development, they’re not interested.