HomeMy WebLinkAboutItem 7b. Introduce an Ordinance approving Local Amendments to the California Energy Code, codified under SLOMC Chapter 15.04.060 (Amendments - Energy Standards)City of San Luis Obispo, Council Memorandum
Council Agenda Report Memo
DATE: October 19, 2023
FROM: Chris Read, Sustainability Manager
SUBJECT: ADOPTION OF LOCAL AMENDMENTS TO THE CALIFORNIA ENERGY
CODE
On September 19, 2023, staff presented an energy reach code to Council for approval.
As part of that Council Agenda Report1, staff provided a summary of cost analysis findings
and references to cost effectiveness studies and data. Since the associated data was in
an Excel based format, it was not archived. This memo archives the data sets by adding
cell references to the previous in-text cost effectiveness descriptions (in red) and a screen
shot of the data set.
The first findings are related to single-family homes and comes from the following data
set: https://localenergycodes.com/download/1286/file_path/fieldList/2022SingleFamily
NewConStudyData.xlsx. A screen shot of the sorted data is available as Figure 1, with
the relevant rows highlighted in yellow.
1. Requiring new single-family residential buildings to achieve an EDR1 margin over
the standard building by 6 or more points. As illustrated in the study data, an all-
electric single-family home with additional efficiency measures would save energy
relative to the base code and would achieve an EDR1 margin of 7.1 (Cell R303)
and a benefit to cost ratio of 12.6 (Cell U303) on a TDV basis. The study data also
shows that a mixed-fuel building with additional efficiency measures, additional
rooftop solar, and a battery storage system would save energy relative to the base
code and would achieve and EDR1 margin of 18.6 (Cell R95) and a benefit to cost
ratio of 1.2 (Cell U95) on a TDV basis. It should be noted that an all-electric building
built to minimum code standards using typically available appliances would
achieve an EDR margin of 6.
1 Item 7b. Introduce an Ordinance approving Local Amendments to the California Energy Code, codified
under SLOMC Chapter 15.04.060 (Amendments - Energy Standards), available at the following link:
https://opengov.slocity.org/WebLink/DocView.aspx?id=181457&dbid=0&repo=CityClerk
Adoption of Local Amendments to the California Energy Code Page 2
Figure 1. Single Family Cost Effectiveness Findings
The second and third findings are related to low-rise and high-rise multi-family buildings
and comes from the following data set:
https://localenergycodes.com/download/1564/file_path/fieldList/2022MultifamilyNewCon
structionStudyData.xlsx. A screen shot of the sorted data is available as Figure 2, with
the relevant rows highlighted in yellow.
2. Requiring low rise multi-family buildings to achieve a Source Energy savings 9%
or more. As illustrated in the study data, an all-electric low rise multi-family building
built to minimum code standards would achieve a Source Energy margin of 9%
(Cell AI47) and a benefit to cost ratio of 9.2 (Cell T47) on a TDV basis. The study
data also shows that a mixed-fuel building with additional efficiency measures,
additional rooftop solar, and a battery storage system would save energy relative
to the base code, would achieve a Source Energy margin of 18% (Cell AI138) and
would achieve a benefit to cost ratio of 1.6 (Cell T 138) on a TDV basis.
Adoption of Local Amendments to the California Energy Code Page 3
3. Requiring high-rise multi-family buildings to achieve a Source Energy savings of
3% or more. As illustrated in the study data, an all-electric high rise multi-family
building built to minimum code standards would achieve a Source Energy margin
of 6% (Cell AI91) and a benefit to cost ratio of 2.2 (Cell T91) on a TDV basis. The
study data also shows that a mixed -fuel building with additional efficiency
measures, additional rooftop solar, and a battery storage system would save
energy relative to the base code, would achieve a Source Energy margin of 3%
(Cell AI159), and would achieve a benefit to cost score of 3.3 (Cell T159) on a TDV
basis.
Figure 2. Multi-Family Cost Effectiveness Findings
The fourth set of findings are related to non -residential buildings and comes from the
following data set: https://localenergycodes.com/download/1373/file_path/fieldList/2022
NonresidentialNewConstructionStudyData.xlsx. These findings are more complicated
and include additional calculations conducted by the City’s technical consultant, TRC
Companies, Inc.
4. Requiring non-residential buildings to achieve a Source Energy budget savings of
7%. The Non-Residential New Construction Reach Code Cost-effectiveness Study
provides analysis for several non-residential building prototypes. One of the
prototypes is a retail building, which prescriptively requires electric heat pump
Adoption of Local Amendments to the California Energy Code Page 4
space conditioning and along with other similar small-to-medium non-residential
buildings that prescriptively require electric space conditioning, would be exempt
from the reach code (see footnote 8, above). As illustrated in the study data for the
remaining non-residential building prototypes, all-electric new non-residential
buildings built to minimum code standards meet or exceed the 7% compliance
margin. Mixed-fuel non-residential buildings with various additional energy
efficiency measures and rooftop solar, would meet or exceed the 7% compliance
margin, save energy relative to the base code, and are cost effective on a TDV
basis.2
These findings are illustrated in Figure 3, with findings related to Quick Service
Restaurants described in detail in footnote 2.
Figure 3. Source Energy Results for Medium Office (MO) and Small Hotel (SH)
2 In addition to the study data posted on the California Energy Codes and Standards Statewide Program
website, staff requested that TRC (the technical consultants that produced the Non -Residential New
Construction Reach Code Cost-Effectiveness study) conduct additional model runs to identify cost effective
measure packages for the “Quick Service Restaurant” building prototype. TRC found that a mixed -fuel
Quick Service Restaurant with additional efficiency measures and a 4kW solar array would save energy
relative to the base code, achieve a Source Energy compliance margin of 8.9%, and would be cost effective
on a TDV basis with a benefit to cost ratio of 1.7.
Item 7b
Department: Administration
Cost Center: 1005
For Agenda of: 9/19/2023
Placement: Public Hearing
Estimated Time: 45 minutes
FROM: Greg Hermann, Deputy City Manager
Timmi Tway, Community Development Director
Prepared By: Chris Read, Sustainability Manager
Michael Loew, Chief Building Official
SUBJECT: INTRODUCTION OF AN ORDINANCE APPROVING LOCAL
AMENDMENTS TO THE CALIFORNIA ENERGY CODE
RECOMMENDATION
Introduce an Ordinance entitled, “An Ordinance of the City Council of the City of San Luis
Obispo, California, adopting Local Amendments to Part 6 of the Building Construction
and Fire Prevention Code, 2023,” to be codified under San Luis Obispo Municipal Code
Chapter 15.04.060 – “Amendments – Energy Standards”.
POLICY CONTEXT
Resolution 11159 (2020 Series) adopts a communitywide goal of carbon neutrality
and a building sector goal of no net new increase of building GHG emissions as the
result of new buildings starting in 2020.
Ordinance 1717 (2022 Series) adds Chapter 8.11 (All-Electric Buildings) to the
Municipal Code requiring that all new buildings be all-electric, with certain limited
exceptions.
Administrative Order 01 (2023 Series) pauses enforcement of Municipal Code
Chapter 8.11 (All-Electric Buildings).
2023-25 Financial Plan Climate Action Major City Goal 4.1.h directs staff to continue
to monitor impacts to Municipal Code 8.11 (All‐Electric New Buildings), and if
necessary, return to Council with an alternative approach to achieving the City's
climate action goals as they relate to new buildings.
REPORT-IN-BRIEF
In 2020, Council adopted a program to encourage all-electric new buildings. In 2022,
Council updated that program to require new buildings to be all -electric via San Luis
Obispo Municipal Code Chapter 8.11. On April 17, 2023, a three-judge panel of the Ninth
Circuit Court of Appeals ruled in California Restaurant Association v. City of Berkeley,
that a Berkeley ordinance requiring all-electric new buildings was pre-empted by the
federal Energy Policy and Conservation Act of 1975 (EPCA) and was therefore invalid.
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Item 7b
On April 18, 2023, Council voted to direct the City Manager and Community Development
Director to temporarily suspend enforcement of the all-electric building requirement for
new buildings. Based on Council feedback from the April 18, 2023 Council meeting, staff
added Task 4.1h to the 2023-25 Climate Action Major City Goal, which states: “Continue
to monitor impacts to Municipal Code 8.11 (All‐Electric New Buildings), and if necessary,
return to Council with an alternative approach to achieving the City’s climate action goals
as they relate to new buildings.”
Staff have continued to monitor the situation and have observed a lack of timely resolution
in the Berkeley case, a lack of imminent statewide resolution for the problem, and the
local receipt of mixed-fuel building permit applications.1 Based on these observations,
staff recommends adopting an interim solution.
The California Restaurant Association v. City of Berkeley ruling limits how the City can
reduce emissions from new buildings. Staff have identified local amendments to the
California Energy Code (also known as a “reach code”) to reduce greenhouse gas
emissions in new buildings as the preferred alternative approach. Since the California
Energy Code only regulates certain energy uses, this approach limits the City’s scope
and therefore the reach code does not apply to cooking equipment (e.g., stoves), laundry
dryers, or other unregulated energy uses.
The proposed reach code, provided as Attachment A, includes requirements for new
buildings that would result in lower operational greenhouse gas emissions. To be
consistent with state law, the City must make findings that the proposed building code
amendments related to building energy performance are cost effective and use less
energy than the standard State Code. The California Energy Commission (CEC) must
agree with the City's analysis before the local amendments to the California Energy Code
can go into effect. This report finds that the proposed amendments that affect building
energy use are cost effective; the studies that illustrate cost effectiveness are provided
as Attachments B, C, and D.
While the proposed approach is less effective at reducing greenhouse gas emissions than
the all-electric new building requirements codified in Municipal Code Chapter 8.11, the
proposed reach codes provide the best and most timely opportunity to continue pursuing
Council’s adopted climate action goals within the existing legal framework.
Should Council move forward with staff’s recommendation, the second reading of the
Ordinance would occur on October 3, 2023. Pending California Energy Commission
approval of the local amendments to the California Energy Code, the reach code would
go into effect on January 1, 2024.
1 “Mixed-fuel” refers to buildings that are served by natural gas and electricity utilities.
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Item 7b
DISCUSSION
Background
Policy Background
On August 19, 2020, Council adopted the Climate Action Plan for Community Recovery
via Resolution 11159 (2020 Series), which approved a communitywide goal of carbon
neutrality and a building sector goal of no additional greenhouse gas (GHG) emissions
as the result of new buildings. To achieve the building sector goal, Council adopted a
program to encourage all-electric new buildings in 2020, and in 2022 adopted an
ordinance requiring new buildings to be all-electric (San Luis Obispo Municipal Code
Chapter "SLOMC” 8.11).
Ninth Circuit Ruling and Subsequent SLOMC Ch. 8.11 Enforcement Suspension
On April 17, 2023, a three-judge panel of the Ninth Circuit Court of Appeals ruled in
California Restaurant Association v. City of Berkeley that a Berkeley ordinance requiring
all-electric new buildings was pre-empted by the federal Energy Policy and Conservation
Act of 1975 (EPCA) and was therefore invalid.
On April 18, 2023, as a result of the panel’s decision, the San Luis Obispo City Council
directed the City Manager and Community Development Director to temporarily suspend
enforcement of the all-electric building requirement for new buildings (SLOMC Chapter
8.11)2. The City of Berkeley is currently petitioning for additional review by the full Ninth
Circuit Court of Appeals. Should a subsequent ruling be issued that overturns or
otherwise vacates the Ninth Circuit Court of Appeals decision, the Administrative Order
would be rescinded and enforcement of Chapter 8.11 will resume .
Justification for Developing an Interim Alternative Approach
Based on Council feedback from the April 18, 2023 , Council meeting, staff added Task
4.1h to the 2023-25 Climate Action Major City Goal, which states: “Continue to monitor
impacts to Municipal Code 8.11 (All‐Electric New Buildings), and if necessary, return to
Council with an alternative approach to achieving the City’s climate action goals as they
relate to new buildings.” Council approved the Major City Goal work task via adoption of
the 2023-25 Financial Plan in June of 2023. Staff have continued to monitor the situation
and have observed the following:
The ruling isn’t likely to be resolved in a timely manner;
There are no imminent statewide fixes for the problem (e.g., the California Energy
Commission updates the California Energy Code on a triennial basis and any
future updates made by the California Energy Commission to the statewide code
that might be more favorable for low-emissions buildings would have to wait until
the effective date of the 2025 California Energy Code, which wouldn’t be
enforceable until January 1, 2026); and
2 The Administrative Order adopted under this direction outlining the conditions of the suspended enforcement is
available on the City’s website
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Item 7b
The City has already started to receive mixed-fuel building permit applications
since the Administrative Order went into effect, which may “lock in” fossil fuel
infrastructure in these buildings for their operational life.
Based on these observations, staff recommends adopting an interim energy reach code
to reduce greenhouse gas emissions from new buildings.
PROPOSED APPROACH
The California Restaurant Association v. City of Berkeley ruling limits how the City can
reduce emissions from new buildings. Staff have identified increased building energy
performance requirements via local amendments to the California Energy Code (also
known as a “reach code”) as the preferred alternative approach. The California Energy
Code establishes whole-building efficiency requirements, which account for a building’s
water heater, HVAC (heating, ventilation, and air conditioning) system, solar generating
system, and insulation, among other things. However, it does not account for cooking
equipment, laundry dryers, or other unregulated energy uses. As such, the proposed
reach code does not regulate cooking equipment, laundry dryers, or other energy uses
not addressed by the California Energy Code.
California Energy Code Energy Evaluation Metrics
The 2022 California Energy Code provides baseline efficiency and building performance
standards that a project must meet before receiving a building permit. The California
Energy Code provides different metrics for different types of buildings and is organized
into three categories:
Single-Family Residential: A new single-family residential building must meet or
exceed “Energy Design Rating” (EDR) scores.3 There are three EDR score
categories:
o EDR1 (Source Energy) – EDR1 is a score representing a building’s energy
efficiency expressed in terms that serve as a proxy for greenhouse gas
emissions.
o EDR2 (Efficiency) – EDR2 is a score representing a building’s energy
efficiency expressed in terms of the value and cost of energy consumed at
different times of the day and year.
o EDR Total (Total Energy Design Rating) is a score representing the
building’s total energy expressed in terms of the value and cost of energy
consumed at different times of the day and year while also factoring in solar
and energy demand flexibility.
3 The definitions in this section are simplified for brevity, for more information, see:
https://energycodeace.com/download/66973/file_path/fieldList/FS.SF%20Bldgs.2022
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Item 7b
Multi-Family Residential: A new multi-family residential building must meet or
exceed a standard that combines the value and cost of energy consumed at
different times of the day and year (re ferred to as Time Dependent Valuation of
energy, or TDV), and the emissions from the building’s energy source . The 2022
Source Energy metric is new for all multifamily buildings, and it was added to
support decarbonization and electrification policy goals.4
Non-Residential: A new non-residential building must also meet or exceed a
standard that uses TDV energy and Source Energy emissions scores.
Proposed Energy Performance Enhancements
Public Resources Code Section 25402.1(h)(2) and Section 10-106 of the Building Energy
Efficiency Standards establish a process that allows local adoption of energy standards
that are more stringent than the statewide standards.5,6 Under this process, the CEC
requires any local amendments to the California Energy Code that affect energy use in
regulated buildings to be cost effective and use less energy than the standard
requirements.
Staff recommends that Council adopt cost effective local amendments (referred to as a
“reach code") to the California Energy Code that would increase the required EDR1 score
for single family residential buildings and the required Source Energy scores for all other
buildings. As noted in Table 1, single-family residential new buildings would be required
to exceed the standard design Total Source Energy Design Rating (EDR1) score by at
least 6 points.7 Table 1 also identifies Source Energy performance requirement for new
multi-family residential buildings (9% better than code for low-rise (three stories or fewer),
3% better for high-rise (four stories or more)), and 7% better for new non-residential
buildings.8
Because of how the EDR1 and Source Energy scores are calculated in the 2022
California Energy Code, the higher standards proposed in the reach code would
incentivize new buildings to include additional electric appliances/mechanical systems,
while also allowing mixed-fuel buildings that include additional energy efficiency
measures. The enhanced performance requirements would apply equally to mixed-fuel
and all-electric buildings and are cost-effectively achievable through the energy code’s
performance pathway without requiring appliances that exceed federal efficiency
standards.
4 The definitions provided in this section are simplified for brevity, for more information, visit:
https://energycodeace.com/resources/?itemId=66025
5 Public Resources Code Section 25402.1:
https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=PRC§ionNum=25402.1
6 Building Energy Efficiency Standards: https://www.energy.ca.gov/sites/default/files/2022-12/CEC-400-2022-
010_CMF.pdf
7 As noted in Section 150.1(c)14 of the 2022 California Energy Code, some small single-family residential buildings in
the City’s Climate Zone (CZ5) are exempt from the mandatory solar requirement. Staff’s recommendation exempts
these buildings from the reach code.
8 Section 140.4(a)2 of the 2022 California Energy Code prescriptively requires electric heat-pump space-conditioning
in several small-to-medium nonresidential building types including retail, grocery, schools, offices, financial institutions,
and libraries. As such, staff’s recommendation exempts these buildings from the reach code.
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Item 7b
Table 1. Proposed Improved Energy Performance Standards
Building Type Performance Requirement
Single Family Residential buildings Exceed the standard EDR1 requirement
by at least 6 points
Multi-Family Residential (Low) Exceed the standard Source Energy
requirement by 9%
Multi-Family Residential (High) Exceed the standard Source Energy
requirement by 3%
Non-Residential Exceed the standard Source Energy
requirement by 7%
Electric Ready Requirements
The 2022 California Energy Code requires certain mixed-fuel buildings to include “electric
ready” components including electric outlets near natural gas appliances, appropriate
ventilation for future heat pump appliances, and reserved and labelled breakers in the
electrical panel for future electric appliances as follows:9,10
Single-Family Residential – heat pump hot water heaters are prescriptively
required, and “electric ready” infrastructure is required for any building that
includes a gas fueled furnace, clothes dryer, and/or cooktop.
Multi-Family Residential – “electric ready” infrastructure is required in a newly
constructed multi-family residential unit that includes a gas fueled space heater,
water heater, clothes dryer, and/or cooktop. Centralized water-heating systems for
multifamily buildings in which dwelling units do not have separate water heaters
are exempt from these requirements.
During the drafting of this report, staff considered developing requirements for “electric
ready” infrastructure for centralized water-heating systems in new multi-family residential
buildings and for water heating systems in new non-residential buildings. Due to the
complexity of these systems, uncertainty around the size and energy needs of future
electric centralized water-heating systems, and uncertainty about the cost effectiveness
standards required for such measures, staff is not recommending these requirements at
this time. Instead, staff recommends that building permit applications identify a pathway
for electrical conduit on construction drawings for fuel-fired central hot water heating
systems in newly constructed buildings that aren’t currently subject to electric-ready
requirements.
Practical Effect of the Reach Code
Because the City is working within the confines of the California Energy Code, th e
description of the proposed approach above is inherently technical . This section illustrates
the practical effect of the proposed approach by providing a simplified example of how a
single-family home designer would comply with the reach code.
9 For additional information about residential electric readiness requirements, see:
https://energycodeace.com/resources/?itemId=91861
10 Note that the California Energy Code’s electric ready requirements extend to cooking equipment and clothes dryers
even though these uses are not otherwise regulated by the code.
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Item 7b
A building designer working on a single-family home built to the code minimum would
likely include high efficiency LED lighting, rooftop solar, an electric heat pump hot water
heater, a natural gas furnace, insulated walls, an insulated attic, and efficient windows,
among other things. The designer would load the building design into a computer model
and estimate its energy performance. The energy modeling software would provide
standard reporting metrics, including an EDR1 score. The designer would then compare
the EDR1 score to a standard design building. In this case, the designed building’s EDR1
score would be equal to the standard design building’s EDR1 score and would comply
with that part of the California Energy Code.
With the reach code in place, the designer would now need to achieve an EDR1 score
that is 6 points better than the standard design building. If this building designer replaced
the gas furnace with a commonly available heat pump HVAC system, the building would
achieve a score that is 6 EDR1 points better than the code minimum and would be
consistent with the proposed reach code requirements. Alternately, the building designer
could keep the gas furnace and install a battery storage system, which would also result
in an increase of more than 6 EDR1 points. The building designer also has the option to
develop a package of efficiency and solar measures; so long as the measures lead to an
increase of 6 or more EDR1 points better than the code minimum, it is consistent with the
reach code.
This example is similar for the other building types where the compliance margins could
be achieved by either installing electric heat pump HVAC equipment or installing some
package of additional solar capacity and efficiency measures.
Cost Effectiveness
The California Energy Commission requires any local amendments to the California
Energy Code that affect energy use in regulated buildings to be cost effective and to use
less energy than the standard requirements. The CEC requires the local agency to adopt
a determination that the energy standards are cost effective at a public meeting. The
determination must subsequently be filed with the Energy Commission.
One way to illustrate cost effectiveness is through the “Time Dependent Valuation” or
“TDV” metric. The TDV metric is what the California Energy Commission uses in
evaluating cost effectiveness for efficiency measures in the California Energy Code and
includes the onsite costs and savings of the proposed energy measures, as well as the
energy system costs and benefits of the energy measures. The metric is “time dependent”
because energy use has different costs and impacts depending on the time of day and
season. For example, electricity saved during peak periods has a much higher value than
electricity saved during off-peak periods.
In support of reach code development, the California Energy Codes and Standards
Statewide Utility Program, which includes the State's Investor-Owned Utilities (PG& E,
SDG&E, and SCE, under the auspices of the California Public Utilities Commission)
developed and published the:11
11 The California Energy Codes and Standards Statewide Utility Program publishes cost effectiveness reports and
accompanying study data at: https://localenergycodes.com/content/resources
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Item 7b
2022 Cost-Effectiveness Study: Single Family New Construction Study
(Attachment B) and the associated cost-effectiveness data;12
2022 Cost-Effectiveness Study: Multifamily New Construction Study (Attachment
C) and the associated cost-effectiveness data;13 and
2022 Code: Non-residential New Construction Reach Code Cost-effectiveness
Study (Attachment D) and the associated cost-effectiveness data.14
These studies and the associated cost-effectiveness data are highly detailed and are
included in the record to support Council’s findings and policy decisions. The studies and
the associated cost-effectiveness data include a calculated benefit-to-cost ratio for a wide
variety of measures, building types, and climate zones. A benefit-cost value of “1” or
greater illustrates that the measures save more than they cost and are therefore “cost
effective.”15 These studies and the associated cost-effectiveness data are the basis for
staff’s cost effectiveness findings and are sufficient to illustrate compliance with the
requirements set forth under California Administrative Code Chapter 10-106.
Based on these studies, staff finds the proposed local amendments to the 2022 California
Energy Code to be cost-effective and consume less energy than otherwise permitted by
Title 24, Part 6. In short, using the California Energy Commission’s TDV metric, the
proposed amendments save more than they cost to implement. The following additional
detail is included for transparency and to facilitate the California Energy Commission’s
review of the City’s cost effectiveness findings:
1. Requiring new single-family residential buildings to achieve an EDR1 margin over
the standard building by 6 or more points. As illustrated in the study data, an all-
electric single-family home with additional efficiency measures would save energy
relative to the base code and would achieve an EDR1 margin of 7.1 and a benefit to
cost ratio of 12.6 on a TDV basis. The study data also shows that a mixed-fuel
building with additional efficiency measures, additional rooftop solar, and a battery
storage system would save energy relative to the base code and would achieve and
EDR1 margin of 18.6 and a benefit to cost ratio of 1.2 on a TDV basis. I t should be
noted that an all-electric building built to minimum code standards using typically
available appliances would achieve an EDR margin of 6.
12 The cost-effectiveness data from the Single-Family Residential study is available at:
https://localenergycodes.com/download/1286/file_path/fieldLis t/2022%20Single%20Family%20NewCon%20Study%2
0Data.xlsx
13 The cost-effectiveness data from the Multifamily Residential study is available at:
https://localenergycodes.com/download/1564/file_path/fieldList/2022%20Multifamily%20New%20Construction%20St
udy%20Data.xlsx
14 The cost-effectiveness data from the Nonresidential study data is available at:
https://localenergycodes.com/download/1373/file_path/fieldList/2022%20Nonresidential%20New%20Construction%2
0Study%20Data.xlsx
15 For more detail, see section 2.1.3 of
https://localenergycodes.com/download/1266/file_path/fieldList/2022%20Nonres%20Ne w%20Construction%20Cost-
eff%20Report.pdf
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Item 7b
2. Requiring low rise multi-family buildings to achieve a Source Energy savings 9% or
more. As illustrated in the study data, an all-electric low rise multi-family building built
to minimum code standards would achieve a Source Energy margin of 9% and a
benefit to cost ratio of 9.2 on a TDV basis. The study data also shows that a mixed-
fuel building with additional efficiency measures, additional rooftop solar, and a
battery storage system would save energy relative to the base code, would achieve
a Source Energy margin of 18% and would achieve a benefit to cost ratio of 1.6 on
a TDV basis.
3. Requiring high-rise multi-family buildings to achieve a Source Energy savings of 3%
or more. As illustrated in the study data, an all-electric high rise multi-family building
built to minimum code standards would achieve a Source Energy margin of 6% and
a benefit to cost ratio of 2.2 on a TDV basis. The study data also shows that a mixed-
fuel building with additional efficiency measures, additional rooftop solar, and a
battery storage system would save energy relative to the base code, would achieve
a Source Energy margin of 3%, and would achieve a benefit to cost score of 3.3 on
a TDV basis.
4. Requiring non-residential buildings to achieve a Source Energy budget savings of
7%. The Non-Residential New Construction Reach Code Cost-effectiveness Study
provides analysis for several non-residential building prototypes. One of the
prototypes is a retail building, which prescriptively requires electric heat pump space
conditioning and along with other similar small-to-medium non-residential buildings
that prescriptively require electric space conditioning, would be exempt from the
reach code (see footnote 8, above). As illustrated in the study data for the remaining
non-residential building prototypes, all-electric new non-residential buildings built to
minimum code standards meet or exceed the 7% compliance margin. Mixed-fuel
non-residential buildings with various additional energy efficiency measures and
rooftop solar, would meet or exceed the 7% compliance margin, save energy relative
to the base code, and are cost effective on a TDV basis.16
Available Resources for Lower Cost All-Electric Buildings
For projects that chose to go all-electric, the state of California and regional entities are
providing technical assistance, substantial rebates, and incentives for all-electric new
buildings. Current programs include:
California Electric Homes is provided by the California Energy Commission and
provides base incentives for all-electric new market rate residential buildings
including $3,000 for single-family homes, $1,750 per multi-family residential unit,
$1,750 per accessory dwelling unit, and $6,000 per modular or manufactured
home. Program participation is capped at $1.5 million per builder and includes
additional incentives for items like induction cooktop and beyond code efficiency
measures.
16 In addition to the study data posted on the California Energy Codes and Standards Statewide Program website, staff
requested that TRC (the technical consultants that produced the Non-Residential New Construction Reach Code Cost-
Effectiveness study) conduct additional model runs to identify cost effective measure packages for the “Quick Service
Restaurant” building prototype. TRC found that a mixed-fuel Quick Service Restaurant with additional efficiency
measures and a 4kW solar array would save energy relative to the base code, achieve a Source Energy compliance
margin of 8.9%, and would be cost effective on a TDV basis with a benefit to cost ratio of 1.7.
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Item 7b
Central Coast Community Energy provides additional incentives for all-electric
accessory dwelling units that stack on top of the California Electric Homes
program.
The Building Initiative for Low -Emissions Development (BUILD) Program is
provided by the California Energy Commission and includes technical support and
incentives for all-electric new affordable housing including approximately $3,399
per multifamily unit and $5,500 per single-family home.
The Energy Code Coach program offered by 3C-REN provides no-cost
personalized support to help building professionals navigate the Energy Code.
Relationship to SLOMC 8.11 (All-Electric Buildings)
Section 6 of Administrative Order 01 (2023 Series), which paused enforcement of the
City’s all-electric new building requirements, notes that the Order “is automatically
rescinded upon any judicial decision which overturns or otherwise vacates the Ruling.”
As described in the draft ordinance (attachment A), should this occur, Chapter 8.11 of the
Municipal Code would supersede the reach code and enforcement of the reach code
would be suspended so long as Chapter 8.11 is being enforced.
Previous Council or Advisory Body Action
September 18, 2018 – City Council identified its carbon neutrality goal and directed
staff to research the possibility of requiring carbon neutral buildings as part of the
City’s building codes.
February 2019 – City Council provided unanimous direction to develop an
approach to carbon neutral new development.
June 4, 2019 – City Council adopts the Climate Action Major City Goal (MCG) with
a “reach code” as an item in the work program.
September 3, 2019 – City Council adopted the Clean Energy Choice Program for
New Buildings.
June 16, 2020 – City Council rescinded portions of the September 3 action and
readopted the Clean Energy Choice Program.
July 7, 2020 – City Council conducted the second reading of Clean Energy Choice
Program ordinances.
August 18, 2020 – The City adopted the Climate Action Plan for Community
Recovery, which included building sector goals and explicitly identifies the need to
update the Clean Energy Choice Program in 2022.
May 18, 2021 – Staff provided a Climate Action Plan update to City Council, which
included an update on building electrification progress.
June 1, 2021 – City Council adopted the 2021-23 Financial Plan with the Climate
Action Major City Goal that called for updating Clean Energy Choice Progra m in
2022.
Page 1774 of 2029
Item 7b
February 1, 2022 – Staff provided a presentation on the first phase of the Clean
Energy Choice Program and received strategic direction from City Council ahead
of the 2022 Program update.
July 5, 2022 – Council adopted the Clean Energy Program for New Buildings,
which required new buildings to be all-electric.
December 13, 2022 – Council adopted the Climate Action Plan Update, which
reaffirms community and new building sector specific goals and includes the 2023 -
27 Climate Action Work Program focused on reducing emissions from buildings.
April 18, 2023 – Council directed the City Manager and Community Development
Director to temporarily suspend enfo rcement of the all-electric building
requirement for new buildings (SLOMC Chapter 8.11.). Enforcement was formally
paused via Administrative Order 01 (2023 Series).
June 6, 2023 – Council adopted the 2023-25 Financial Plan, which includes
Climate Action Major City Goal 4.1.h that directs staff to continue to monitor
impacts to Municipal Code 8.11 (All-Electric New Buildings), and if necessary
return to Council with an alternative approach to achieving the City's climate action
goals as they relate to new buildings.
Public Engagement
As described in the 2019, 2020, and 2022 Council Agenda Reports, extensive outreach
was conducted in various community forums a nd settings affirming that all-electric new
buildings are feasible, cost-effective, and supportive of the City’s climate action goals.
Prior to the Ninth Circuit ruling that led to the City’s suspending enforcement of Municipal
Code Chapter 8.11’s all-electric new building requirement, the Council’s policy had been
seeing successful implementation. The work conducted in support of the proposed reach
code is a continuation of existing Council policy related to low-emissions new buildings.
During development of the reach code, staff conducted community outreach in
accordance with the Public Engagement and Noticing Manual. Specifically, the City
presented the update to the Developer’s Roundtable (e.g., developers, architects,
engineers, design professionals, and property owners) and to the Green and Healthy
Homes Roundtable (e.g., community-based organizations, technical experts, and key
non-profit housing providers), notified appliance retail stakeholders about the proposed
reach code, and highlighted the item in the City’s Council Meeting Preview social media
posts. Should Council adopt the reach code, staff would initiate general awareness
outreach via the Council Meeting Recap and a news release ; and would share information
about the reach code directly with project applicants via Community Development
Department staff.
Schedule and Next Steps
Should Council approve staff’s recommendations, work would proceed on the timeline
provided in Table 2. It is important to note that the California Building Code, which
includes the California Energy Code, is updated every three years. Should Council adopt
staff’s recommendation, the local reach code would expire with the current Building Code
on December 31, 2025.
Page 1775 of 2029
Item 7b
Table 2. Schedule and Next Steps
Task Timeframe
Second reading of the draft Ordinance
(Attachment A) and submittal to the
California Energy Commission.
October 3, 2023
Receive approval from the California
Energy Commission November - December
Reach code goes into effect January 1, 2024
CONCURRENCE
Staff from Administration, Community Development, and the City Attorney’s Office concur
with this report.
ENVIRONMENTAL REVIEW
Staff’s recommendations are found to be exempt from CEQA under th e general rule,
15061(b)(3), because it can be seen with certainty that the provisions contained herein
would not have the potential for causing a significant effect on the environment. Further,
this ordinance is also exempt from CEQA under the categorical exemptions in Section
15308 of the CEQA Guidelines in that the proposed ordinance would institute regulatory
requirements intended to protect the environment and natural resources.
FISCAL IMPACT
Budgeted: Yes Budget Year: 2023-24
Funding Identified: Yes
Fiscal Analysis:
Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund $ $ $ $
State
Federal
Fees
Other:
Total $ $ $ $
The reach code requirements will be implemented through the development review and/or
building permit review process. The staff time to review projects is already budgeted and
is a core work task of the Community Development Department. This work can be directly
supported by the 3C-REN Energy Code Coach Program, which provides technical
support for code interpretation. Funded under the auspices of the California Public Utilities
Commission, Energy Code Coach is free to the user and can be accessed by project
applicants and City staff.
Page 1776 of 2029
Item 7b
ALTERNATIVES
1. Council could request more information, suggest changes, or request that the
proposed local amendments to the California Energy Code be presented for
adoption at a later date. Should Council pursue this alternative, staff requests
specific direction and feedback.
2. Council could take no action and direct staff to pursue other initiatives. This
action is not recommended by staff because it is inconsistent the City’s climate action
goals and prior Council direction and adopted policy.
ATTACHMENTS
A - Draft Ordinance Adopting Local Amendments to the California Energy Code
B - 2022 Cost-Effectiveness Study: Single Family New Construction Study
C - 2022 Cost-Effectiveness Study: Multifamily New Construction Study
D - 2022 Code: Non-Residential New Construction Reach Code Cost-Effectiveness Study
Page 1777 of 2029
Page 1778 of 2029
O ______
ORDINANCE NO. _____ (2023 SERIES)
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN LUIS
OBISPO, CALIFORNIA, ADOPTING LOCAL AMENDMENTS TO PART 6
OF THE BUILDING CONSTRUCTION AND FIRE PREVENTION CODE,
2023.
WHEREAS, greenhouse gas accumulation in the atmosphere as the result of
human activity is the primary cause of the global climate crisis; and
WHEREAS, in California alone, the initial impacts of climate change have resulted
in unprecedented disasters with tremendous human, economic, and environmental costs
and;
WHEREAS, the Intergovernmental Panel on Climate Change estimates that global
emissions need to be reduced by 45 percent from 2010 levels by 2030, and 100 percent
by 2050 to prevent global catastrophe; and
WHEREAS, the State of California enacted Assembly Bill (AB) 1279 to require
statewide carbon neutrality "as soon as possible," but no later than 2045; and
WHEREAS, City of San Luis Obispo residents and businesses have repeatedly
identified climate action as a top community priority; and
WHEREAS, Resolution 11159 (2020 Series) adopts the City of San Luis Obispo
Climate Action Plan for Community Recovery, which includes a communitywide goal of
carbon neutrality by 2035 and sector specific goal of no net new building emissions from
onsite energy use by 2020; and
WHEREAS, Resolution 11381 (2022 Series) reaffirmed the communitywide goal
of carbon neutrality by 2035 and sector specific goal of no net new building emissions
from onsite energy use by 2020; and
WHEREAS, the inventoried greenhouse gas emissions in the City of San Luis
Obispo come from a variety of sources, primarily transportation and energy use in
buildings and facilities; and
WHEREAS, in order to achieve carbon neutrality, new sources of greenhouse gas
emissions need to be substantially reduced or eliminated; and
WHEREAS, Public Resources Code Section 25402.1 (h)(2) allows local agencies
to adopt more stringent local amendments to the energy conservation provisions in the
California Energy Code; and
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Ordinance No. _____ (2023 Series) Page 2
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WHEREAS, the California Energy Codes and Standards Statewide Utility
Program, has determined specific modifications to the 2022 State Energy Code for each
climate zone that are cost-effective; and that such modifications will result in designs that
consume less energy than they would under the 20 22 State Energy Code; and
WHEREAS, staff has reviewed the "2022 Cost-Effectiveness Study: Single Family
New Construction Study" and associated study data, the “2022 Cost-Effectiveness Study:
Multifamily New Construction Study” and associated study data, and the “2022 Code:
Non-Residential New Construction Reach Code Cost-Effectiveness Study” and
associated data developed for the California Energy Codes and Standards Statewide
Utility Program, and find them sufficient to illustrate compliance with the requirements set
forth under California Administrative Code Chapter 10-106; and
WHEREAS, based on these studies, the City finds the proposed local
amendments to the 2022 California Energy Code to be cost-effective and consume less
energy than permitted by Title 24, Part 6; and
WHEREAS, the 2022 California Energy Code offers compliance options that were
established through the public rulemaking process of the code update; and
WHEREAS, the Council expressly declares that the proposed amendments to the
Energy Code are reasonably necessary because of local climatic, topological, and
geological conditions; and
WHEREAS, the requirements specified in this Ordinance were reviewed via public
comment and through a publicly noticed public hearing process.
NOW, THEREFORE, BE IT ORDAINED by the Council of the City of San Luis
Obispo as follows:
SECTION 1. Purpose. It is the purpose and intent of this Ordinance to establish
standards for new buildings to exceed minimum 20 22 Title 24 Part 6 requirements.
SECTION 2. Adoption. The local amendments to Part 6 of the City of San Luis
Obispo Building Construction and Fire Prevention Code, 2023 (SLOMC Section
15.02.060) as specified in Exhibit A, are hereby adopted by the City of San Luis Obispo
to be codified under Chapter 15.04.060. The Council hereby adopts the recitals herein as
separate and additional findings of fact in support of adoption of the ordinance.
SECTION 3. Relationship to Administrative Order 01 (2023 Series) and
Supersedure by Municipal Code Chapter 8.11. By its terms, Administrative Order 01
(2023 Series), which paused enforcement of the City’s all-electric new building
requirement (SLOMC Chapter 8.11), is rescinded upon any judicial decision which
overturns or otherwise vacates the Ninth Circuit panel ruling issued in California
Restaurant Association v. City of Berkeley. Should this occur, enforcement of Chapter
8.11 will resume, and enforcement of Section 15.04.060 as adopted herein will be
suspended.
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Ordinance No. _____ (2023 Series) Page 3
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SECTION 4. Severability. If any word, phrase sentence part, section, subsection
or other portion of this amendment or any application thereof to any person or
circumstance is declared void, unconstitutional, or invalid for any reason, then such word,
phrase, sentence, part, section, subsection, or other portion, or the prescribed application
thereof, shall be severable, and the remaining provisions of this amendment, and all
applications thereof, not having been declared void, unconstitutional or invalid, shall
remain in full force and effect. The City of San Luis Obispo hereby declares that it would
have passed this amendment and each section, subsection sentence, clause and phrase
of this amendment, irrespective of the fact that any one or more sections, subsection,
sentences, clauses or phrases is declared invalid or unconstitutional.
SECTION 5. Findings. The City Council finds that each of the changes or
modifications to measures referred to therein are reasonably necessary because of local
climatic, geological, or topographical conditions in the area encompassed by the
boundaries of the City of San Luis Obispo, and the City Council adopts the following
findings in support of local necessity for the changes or modifications:
1. San Luis Obispo is situated along a wildland -urban interface and has been
identified as a Community at Risk from wildfire and is extremely vulnerable to
wildfires and firestorms, and human activities releasing greenhouse gases into
the atmosphere cause increases in worldwide average temperature, drought
conditions, vegetative fuel, and length of fire seasons - contributing to the
likelihood and consequences of fire.
2. The City of San Luis Obispo is situated at the base of a watershed of the Santa
Lucia Mountains and flooding of San Luis, Chorro, Stenner, Old Garden, and
Brizzolara Creeks results in conditions rendering fire department vehicular
traffic unduly burdensome or impossible, as witnessed in major floods that
occurred in 1952, 1961, 1969, 1973, 1978, 1982, 1995 , and 2023. Furthermore,
flood conditions described above create the potential for overcoming the ability
of the fire department to aid or assist in fire control, evacuations, rescues and
other emergency task demands inherent in such situations. The resulting
overburdening of fire department personnel may cause a substantial or total
lack of protection against fire for the buildings and structures located in the City
of San Luis Obispo. The afore-described conditions support the imposition of
fire protection requirements greater than those set forth in the California State
Building Standards Code and support the imposition of more restrictive
requirements than set forth in the California Energy Code for the purpose of
reducing the City's contributions to Greenhouse Gas Emissions resulting in a
warming climate and related severe weather events.
3. The aforementioned flood and rain events result in conditions wherein
stormwater can inundate the wastewater treatment system as witnessed in
major floods that occurred in 1952, 1961, 1969, 1973, 1978, 1982, an d 1995.
Furthermore, rain events and flood conditions described above create a
condition referred to as Inflow and Infiltration (I/I) that allow rain and flood
waters to flow and/or seep into the wastewater system and overcome the ability
Page 1781 of 2029
Ordinance No. _____ (2023 Series) Page 4
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of the wastewater collection system and Water Reclamation Facility (WRF) to
convey and treat sewage. The resulting overburdening of the wastewater
system can result in threats to public health, public and private property and
water quality and violations and fines from the State of California, the
Environmental Protection Agency (EPA) or others. To the extent that climate
change has the potential to make these conditions worse, more restrictive
Energy Code requirements to achieve reduced greenhouse gas emissions are
necessary.
4. Seasonal climatic conditions during the late summer and fall create numerous
serious difficulties in the control and protection against fire situations in the City
of San Luis Obispo. The hot, dry weather in combination with Santa Lucia
(offshore) winds frequently results in wildland fires in the brush-covered slopes
on the Santa Lucia Mountains, San Luis Mountain, and the Irish Hills areas of
the City of San Luis Obispo. The aforementioned areas surround the City.
When a fire occurs in said areas, such as occurred in 1985 when the Los Pilitas
fire burned six days and entered the City and damaged many structures, the
entirety of local fire department personnel is required to control, monitor, fight
and protect against such fire situations in an effort to protect life and preserve
property and watershed land. The same climatic conditions may result in the
concurrent occurrence of one or more fires in the more populated areas of the
City without adequate fire department personnel to protect against and cont rol
such a situation. Therefore, the above -described findings support the
imposition of measures to increase the efficiency of new buildings in the City to
reduce greenhouse gas emissions.
SECTION 6. CEQA. This ordinance is categorically exempt from CEQA because
it is an action taken by a regulatory agency for the purpose of protecting the environment
(CEQA Guidelines Section 15308). In addition, this ordinance is exempt from CEQA
under the general rule, 15061(b)(3), on the grounds that these standards are more
stringent than the State energy standards, there are no reasonably foreseeable adverse
impacts, and there is no possibility that the activity in question may have a significant
effect on the environment. The following findings are made in support of these
determinations:
1. The purpose of the implementation of a Reach Code is to reduce the amount
of greenhouse gas emissions in the City of San Luis Obispo that are produced
from buildings.
2. The Reach Code approval process requires that the City determines that the
local standards will require buildings to use no more energy than current
statewide requirements. Furthermore, the California Energy Commission
approval process requires that the City make the findings as part of its approval
process. Therefore, the Reach Code standards can only go into effect if they
protect the environment by making buildings more efficient.
Page 1782 of 2029
Ordinance No. _____ (2023 Series) Page 5
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SECTION 7. Violations. Violation of the requirements of this Ordinance shall be
considered, at the City’s election, an infraction of the City of San Luis Obispo Municipal
Code punishable by all sanctions prescribed in Chapter 1.12, or an administrative
violation punishable as provided under Chapter 1.24 .
SECTION 8. Effective Date. This Ordinance shall be effective as of January 1,
2024.
SECTION 9. Ordinance Summary. A summary of this ordinance, together with the
names of Council members voting for and against, shall be published at least five (5) days
prior to its final passage, in The New Times, a newspaper published and circulated in this
City. This ordinance shall go into effect at the expiration of thirty (30) days after its final
passage.
INTRODUCED on the _____ day of _________ 2023, AND FINALLY ADOPTED
by the Council of the City of San Luis Obispo on the ____ day of ____, 20 23, on the
following vote:
AYES:
NOES:
ABSENT:
___________________________
Mayor Erica A. Stewart
ATTEST:
_______________________
Teresa Purrington
City Clerk
APPROVED AS TO FORM:
_______________________
J. Christine Dietrick
City Attorney
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the
City of San Luis Obispo, California, on ______________________.
___________________________
Teresa Purrington, City Clerk
Page 1783 of 2029
Ordinance No. _____ (2023 Series) Page 6
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Exhibit A
Section 15.04.060
AMENDMENTS - ENERGY STANDARDS
A. Adoption of Codes and Applicability
The effective date of this ordinance shall be January 1, 2024 and is applicable to
newly constructed buildings and facilities, and those that are built after a
demolition. The minimum energy compliance margin standards established in this
code shall apply to all applicable buildings accordingly. The amendments
contained in 15.04.060 do not apply to additions, alterations, or repairs to buildings
or facilities constructed prior to the effective date of this ordinance.
B. Add Item D to Subchapter 1, Section 100.0(e)3, to read as follows:
D. Prohibited reduction in source energy performance. No repair, addition, or
alteration shall reduce the efficiency of any building or facility, as determined by
the source energy compliance margin.
C. Add the following definition to Subchapter 1, Section 100.1(b):
DEMOLITION is the act of reconstructing, removing, taking down or destroying all
or portions of an existing building or structure, or making extensive repairs or
modifications to an existing building or structure, if such changes involve removal
or replacement of fifty percent or more of both the structural framing and cladding
or of the exterior walls within a twenty-four-month period. When determining
whether a building or structure is demolished, the following applies:
1. The nonconforming portions of any wall are counted as removed or taken
down, even when retention of these portions is proposed.
2. Any continuous run of remaining exterior wall surfaces measuring ten feet or
less in length are counted as removed or replaced.
D. Add Section 120.11 to Subchapter 3, to read as follows:
120.11 Electric Readiness Requirements for All Systems
Where nonresidential systems using gas or propane are installed, the construction
drawings shall indicate a pathway for routing of conduit from the equipment using
gas or propane to the point of interconnection with the electrical service.
E. Delete Section 140.1 from Subchapter 5, and replace with new Section 140.1 to
read as follows:
A building complies with the performance approach provided that:
1. The TDV energy budget calculated for the Proposed Design Building under
Subsection (b) is no greater than the TDV energy budget calculated for the Standard
Page 1784 of 2029
Ordinance No. _____ (2023 Series) Page 7
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Design Building under Subsection (a), and
2. The energy budget calculated for the proposed design building under Subsection
(b) has a source energy compliance margin, relative to the energy budget calculated
for the standard design building under Subsection (a), of at least 7 percent for all
nonresidential occupancies.
Exception to Section 140.1 item 2. A source energy compliance margin of at least
7 percent is not required when nonresidential occupancies are designed with single
zone space-conditioning systems complying with Section 140.4(a)2.
(a) Energy budget for the standard design building. The energy budget for the
Standard Design Building is determined by applying the mandatory and prescriptive
requirements to the proposed design building. The energy budget is the sum of the
TDV energy for space-conditioning, indoor lighting, mechanical ventilation,
photovoltaic (PV) and battery storage systems, service water heating and covered
process loads.
(b) Energy budget for the proposed design building.
The energy budget for a proposed design building is determined by calculating the
TDV energy for the proposed design building. The energy budget is the sum of the
TDV energy for space-conditioning, indoor lighting, mechanical ventilation,
photovoltaic (PV) and battery storage systems, and service water heating and covered
process loads.
Exception to Section 140.1(b). A community shared solar electric generation
system, or other renewable electric generation system, and/or community shared
battery storage system, that provides dedicated power, utility energy reduction
credits or payments for energy bill reductions to the permitted building and is
approved by the Energy Commission as specified in Title 24, Part 1, Section 10 -
115, may offset part or all of the solar electric generation system or battery storage
system TDV energy required to comply with the standards, as calculated according
to methods established by the Commission in the Nonresidential ACM Reference
Manual.
(c) Calculation of energy budget. The TDV energy for both the standard design
building and the proposed design building shall be computed by compliance software
certified for this use by the Commission. The processes for compliance software
approval by the Commission are documented in the ACM Approval Manual.
Note: Authority: Sections 25213, 25218, 25218.5, 25402 and 25402.1, Public
Resources Code. Reference: Sections 25007, 25008, 25218.5, 25310, 25402,
25402.1, 25402.4, 25402.5, 25402.8, and 25943, Public Resources Code.
G. Amend Subchapter 8, Section 150.1(b) to read as follows, with items 2 and 3 to
remain:
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Ordinance No. _____ (2023 Series) Page 8
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(b) Performance Standards. A building complies with the performance standards if the
energy consumption calculated for the proposed design building is no greater than
the energy budget calculated for the standard design building using Commission -
certified compliance software as specified by the Alternative Calculation Methods
Approval Manual, and as specified in items 1, 2 and 3 below.
1. Newly Constructed Buildings. The Energy Budget for newly constructed
buildings is expressed in terms of the Energy Design Ratings, which are
based on source energy and time -dependent valuation (TDV) energy. The
Energy Design Rating 1 (EDR1) is based on source energy. The Energy
Design Rating 2 (EDR2) is based on TDV energy and has two components,
the Energy Efficiency Design Rating, and the Solar Electric Generation and
Demand Flexibility Design Rating. The total Energy Design Rating shall
account for both the Energy Efficiency Design Rating and the Solar Electric
Generation and Demand Flexibility Design Rating. The proposed build ing
shall separately comply with the Source Energy Design Rating, Energy
Efficiency Design Rating and the Total Energy Design Rating. A newly
constructed building complies with the performance approach if the TDV
energy budget calculated for the proposed design building is no greater than
the TDV energy budget calculated for the Standard Design Building AND
the Source Energy compliance margin is at least 6, relative to the Source
Energy Design Rating 1 calculated for the Standard Design building.
EXCEPTION 1 to Section 150.1(b)1. A community shared solar electric
generation system, or other renewable electric generation system, and/or
community shared battery storage system, which provides dedicated
power, utility energy reduction credits, or payments for ene rgy bill
reductions, to the permitted building and is approved by the Energy
Commission as specified in Title 24, Part 1, Section 10-115, may offset part
or all of the solar electric generation system Energy Design Rating required
to comply with the Standards, as calculated according to methods
established by the Commission in the Residential ACM Reference Manual.
EXCEPTION 2 to Section 150.1(b)1. A newly constructed building that does
not require a PV system in accordance with section 150.1(c)14 does not
need a Source Energy compliance margin of at least 6, relative to the
Source Energy Design Rating 1 calculated for the Standard Design building.
I. Add Section 160.9(d), to read as follows:
160.9(d) Central Water Heater Readiness
Where a multi-family central water heating system using gas or propane is
installed, the construction drawings shall indicate a pathway for routing of conduit
from the equipment using gas or propane to the point of interconnection with the
electrical service.
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Ordinance No. _____ (2023 Series) Page 9
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J. Amend Subchapter 11, Section 170.1, paragraph 1, to read as follows:
A building complies with the performance approach if the TDV energy budget
calculated for the proposed design building under Subsection (b) is no greater than
the TDV energy budget calculated for the Standard Design Building under
Subsection (a). Additionally:
1. The source energy budget of a newly constructed multifamily building
(with three or less habitable stories) shall be at least 9% lower than that
of the Standard Design Building.
2. The source energy budget of newly constructed multifamily buildings
(with four or more habitable stories) shall be at least 3% lower than that
of the Standard Design Building.
Page 1787 of 2029
Page 1788 of 2029
Prepared by:
Frontier Energy, Inc
Misti Bruceri & Associates, LLC
Prepared for:
Kelly Cunningham, Codes and Standards Program, Pacific Gas and Electric
Last modified: 2023/06/20
Revision: 1.1
2022 Cost-Effectiveness Study:
Single Family New
Construction
Page 1789 of 2029
Cost-Effectiveness Analysis: Single Family New Construction
Legal Notice
This report was prepared by Pacific Gas and Electric Company
and funded by the California utility customers under the auspices
of the California Public Utilities Commission.
Copyright 2023, Pacific Gas and Electric Company. All rights
reserved, except that this document may be used, copied, and
distributed without modification.
Neither PG&E nor any of its employees makes any warranty,
express or implied; or assumes any legal liability or responsibility
for the accuracy, completeness or usefulness of any data,
information, method, product, policy or process disclosed in this
document; or represents that its use will not infringe any
privately-owned rights including, but not limited to, patents,
trademarks or copyrights.
Acronym List
2023 PV$ – Present value costs in 2023
ACH50 – Air Changes per Hour at 50 pascals pressure
differential
ACM – Alternative Calculation Method
ADU – Accessory Dwelling Unit
AFUE – Annual Fuel Utilization Efficiency
B/C – Lifecycle Benefit-to-Cost Ratio
BEopt – Building Energy Optimization Tool
BSC – Building Standards Commission
CA IOUs – California Investor-Owned Utilities
CASE – Codes and Standards Enhancement
CBECC-Res – Computer program developed by the California
Energy Commission for demonstrating compliance
with the California Residential Building Energy
Efficiency Standards
CFI – California Flexible Installation
CFM – Cubic Feet per Minute
CO2 – Carbon Dioxide
CPAU – City of Palo Alto Utilities
CPUC – California Public Utilities Commission
CZ – California Climate Zone
DHW – Domestic Hot Water
DOE – Department of Energy
DWHR – Drain Water Heat Recovery
EDR – Energy Design Rating
EER – Energy Efficiency Ratio
EF – Energy Factor
Page 1790 of 2029
Cost-Effectiveness Analysis: Single Family New Construction
GHG – Greenhouse Gas
HERS Rater – Home Energy Rating System Rater
HPA – High Performance Attic
HPWH – Heat Pump Water Heater
HSPF – Heating Seasonal Performance Factor
HVAC – Heating, Ventilation, and Air Conditioning
IECC – International Energy Conservation Code
IOU – Investor Owned Utility
kBtu – kilo-British thermal unit
kWh – Kilowatt Hour
LBNL – Lawrence Berkeley National Laboratory
LCC – Lifecycle Cost
LLAHU – Low Leakage Air Handler Unit
VLLDCS – Verified Low Leakage Ducts in Conditioned Space
MF – Multifamily
NEEA – Northwest Energy Efficiency Alliance
NEM – Net Energy Metering
NPV – Net Present Value
NREL – National Renewable Energy Laboratory
PG&E – Pacific Gas and Electric Company
POU – Publicly-Owned-Utilities
PV – Photovoltaic
SCE – Southern California Edison
SDG&E – San Diego Gas and Electric
SEER – Seasonal Energy Efficiency Ratio
SF – Single Family
SMUD – Sacramento Municipal Utility District
SoCalGas – Southern California Gas Company
TDV – Time Dependent Valuation
Therm – Unit for quantity of heat that equals 100,000 British thermal units
Title 24 – Title 24, Part 6
TOU – Time-Of-Use
UEF – Uniform Energy Factor
ZNE – Zero-net Energy
Page 1791 of 2029
Cost-Effectiveness Analysis: Single Family New Construction
Summary of Revisions
Date Description Reference (page or section)
9/12/2022 Original Release N/A
6/20/2023 Minor revision to content, no change to results 1, 42
Page 1792 of 2029
Cost-Effectiveness Analysis: Single Family New Construction
TABLE OF CONTENTS
Executive Summary .......................................................................................................................................................... 1
1 Introduction ................................................................................................................................................................ 3
2 Methodology and Assumptions ............................................................................................................................... 4
2.1 Analysis for Reach Codes ..................................................................................................................................................... 4
2.1.1 Modeling ....................................................................................................................................................................... 4
2.1.2 Cost-Effectiveness ........................................................................................................................................................ 4
2.1.3 Utility Rates ................................................................................................................................................................... 6
2.2 Greenhouse Gas Emissions ................................................................................................................................................. 6
2.3 Energy Design Rating ........................................................................................................................................................... 7
3 Prototypes, Measure Packages, and Costs ............................................................................................................ 8
3.3 Measure Definitions and Costs ........................................................................................................................................... 10
3.3.1 Efficiency, Solar PV, and Batteries ............................................................................................................................. 10
3.3.2 All-Electric ................................................................................................................................................................... 16
3.4 Measure Packages ............................................................................................................................................................. 22
4 Results ...................................................................................................................................................................... 24
4.1 2022 Metrics and Compliance............................................................................................................................................. 24
4.2 All-Electric Code Minimum Results ..................................................................................................................................... 26
4.3 All-Electric Plus Efficiency, PV, and Battery Results ........................................................................................................... 29
4.4 Mixed Fuel Results ............................................................................................................................................................. 31
4.5 CARE Rate Comparison ..................................................................................................................................................... 34
4.6 Utility Infrastructure Cost Sensitivity .................................................................................................................................... 36
4.7 Greenhouse Gas Reductions .............................................................................................................................................. 38
5 Summary .................................................................................................................................................................. 41
6 References ............................................................................................................................................................... 44
7 Appendices .............................................................................................................................................................. 46
7.1 Map of California Climate Zones ......................................................................................................................................... 46
7.2 Utility Rate Schedules ......................................................................................................................................................... 47
7.2.1 Pacific Gas & Electric .................................................................................................................................................. 47
7.2.2 Southern California Edison ......................................................................................................................................... 53
7.2.3 Southern California Gas .............................................................................................................................................. 57
7.2.4 San Diego Gas & Electric............................................................................................................................................ 60
7.2.5 City of Palo Alto Utilities .............................................................................................................................................. 65
7.2.6 Sacramento Municipal Utilities District (Electric Only) ................................................................................................. 68
7.2.7 Fuel Escalation Assumptions ...................................................................................................................................... 69
7.3 Summary of Measures by Package .................................................................................................................................... 70
LIST OF TABLES
Table 1. Utility Tariffs Used Based on Climate Zone ............................................................................................................................ 6
Table 2: Prototype Characteristics ........................................................................................................................................................ 8
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Cost-Effectiveness Analysis: Single Family New Construction
Table 3: Base case Characteristics of the Prototypes .......................................................................................................................... 9
Table 4: Base Package PV Capacities (kW-DC) ................................................................................................................................ 10
Table 5: Incremental Cost Assumptions ............................................................................................................................................. 13
Table 6. Single Family IOU Natural Gas Main Distribution Line Extension Costs ............................................................................... 17
Table 7. Residential IOU Gas Line Extension Appliance Allowances ................................................................................................. 17
Table 8. Single Family IOU Natural Gas Service Line Extension Costs ............................................................................................. 17
Table 9. Single Family IOU Other Natural Gas Infrastructure Costs ................................................................................................... 17
Table 10. Single Family IOU Total Natural Gas Infrastructure Costs1 ................................................................................................ 18
Table 11. Single Family CPAU Total Natural Gas Infrastructure Costs .............................................................................................. 18
Table 12. ADU Utility Infrastructure Costs .......................................................................................................................................... 19
Table 13: Lifetime of Water Heating & Space Conditioning Equipment Measures ............................................................................. 19
Table 14. Single Family All-Electric Appliance Incremental Costs ...................................................................................................... 21
Table 15. ADU All-Electric Appliance Incremental Costs .................................................................................................................... 22
Table 16. Single Family Cost-Effectiveness: All-Electric Code Minimum ............................................................................................ 27
Table 17. ADU Cost-Effectiveness: All-Electric Code Minimum .......................................................................................................... 28
Table 18. Single Family Cost-Effectiveness: All-Electric Energy Efficiency + Additional PV + Battery ............................................... 29
Table 19. ADU Cost-Effectiveness: All-Electric Energy Efficiency + Additional PV + Battery ............................................................. 30
Table 20. Single Family Cost-Effectiveness: Mixed Fuel Efficiency + PV + Battery ............................................................................ 31
Table 21. ADU Cost-Effectiveness: Mixed Fuel Efficiency + PV + Battery ......................................................................................... 32
Table 22. Single Family Cost-Effectiveness: Mixed Fuel Packages ................................................................................................... 33
Table 23. ADU Cost-Effectiveness: Mixed Fuel Packages ................................................................................................................. 34
Table 24. On-Bill Cost-Effectiveness with CARE Tariffs: All-Electric Code Minimum ......................................................................... 35
Table 25. On-Bill Cost-Effectiveness with CARE Tariffs: Mixed Fuel Efficiency+ PV+ Battery Package ............................................ 36
Table 26. Single Family Cost-Effectiveness Comparison with Range of Natural Gas Utility Infrastructure Costs: All-Electric Code
Minimum ............................................................................................................................................................................................. 37
Table 27. Single Family Cost-Effectiveness On-Bill Impact of CPUC Proposed Design on Gas Line Extension Allowances: All-
Electric Code Minimum ....................................................................................................................................................................... 38
Table 28: Single Family Greenhouse Gas Reductions (metric tons) .................................................................................................. 39
Table 29 ADU Greenhouse Gas Savings (metric tons) ...................................................................................................................... 40
Table 30. Summary of All-Electric Efficiency EDR2 Margins and Cost-Effectiveness ........................................................................ 42
Table 31. Summary of Mixed Fuel Efficiency EDR2 Margins and Cost-Effectiveness ........................................................................ 43
Table 32: PG&E Baseline Territory by Climate Zone .......................................................................................................................... 48
Table 33: PG&E Monthly Gas Rate ($/therm) ..................................................................................................................................... 48
Table 34: PG&E Monthly CARE (GL-1) Gas Rate ($/therm)............................................................................................................... 48
Table 35: SCE Baseline Territory by Climate Zone ............................................................................................................................ 54
Table 36: SoCalGas Baseline Territory by Climate Zone ................................................................................................................... 58
Table 37: SoCalGas Monthly Gas Rate ($/therm) .............................................................................................................................. 58
Table 38: SDG&E Baseline Territory by Climate Zone ....................................................................................................................... 60
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Cost-Effectiveness Analysis: Single Family New Construction
Table 39: SDG&E Monthly Gas Rate ($/therm) .................................................................................................................................. 60
Table 40: CPAU Monthly Gas Rate ($/therm) ..................................................................................................................................... 66
Table 41: Real Utility Rate Escalation Rate Assumptions ................................................................................................................... 69
Table 42: Single Family Efficiency Package Measures ...................................................................................................................... 70
Table 43: Single Family Mixed Fuel Efficiency + PV + Battery Package Measures ............................................................................ 71
Table 44: ADU Efficiency Package Measures .................................................................................................................................... 71
Table 45: Single Family All-Electric Code Compliant Efficiency Measures ......................................................................................... 72
Table 46: ADU All-Electric Code Compliant Efficiency Measures ....................................................................................................... 72
LIST OF FIGURES
Figure 1: Single Family All-Electric Home Compliance Impacts ......................................................................................................... 24
Figure 2: ADU All-Electric Home Compliance Impacts ....................................................................................................................... 25
Figure 3: Single Family Four Gas Appliance Home Compliance Impacts ........................................................................................... 25
Figure 4. Map of California climate zones. .......................................................................................................................................... 46
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Cost-Effectiveness Analysis: Single Family New Construction
Executive Summary 1
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Executive Summary
The California Codes and Standards (C&S) Reach Codes program provides technical support to local governments
considering adopting a local ordinance (reach code) intended to support meeting local and/or statewide energy
efficiency and greenhouse gas reduction goals. The program facilitates adoption and implementation of the code when
requested by local jurisdictions by providing resources such as cost-effectiveness studies, model language, sample
findings, and other supporting documentation.
This report documents cost-effectiveness analysis results for traditional new detached single family and detached
accessory dwelling unit (ADUs) building types. It evaluates mixed fuel and all-electric package options in all sixteen
California climate zones (CZs). Packages include combinations of efficiency measures, on-site renewable energy, and
battery energy storage.
The following summarizes key results from the study:
• All-electric packages have lower GHG emissions than mixed-fuel packages in all cases, due to the clean
power sources currently available from California’s power providers.
• The Reach Codes Team found all-electric new construction to be feasible and cost effective based on TDV in
all cases. In many cases all-electric code minimum construction results in an increase in utility costs and is not
cost-effective On-Bill. Some exceptions include the SMUD and CPAU territories where lower electricity rates
relative to natural gas rates result in lower overall utility bills.
• The 2022 Title 24 Code’s new source energy metric combined with the heat pump baseline encourage all-
electric construction, providing an incentive that allows for some amount of prescriptively required building
efficiency to be traded off. This compliance benefit for all-electric homes highlights a unique opportunity for
jurisdictions to incorporate efficiency into all-electric reach codes. Efficiency and electrification have symbiotic
benefits and are both critical for decarbonization of buildings. As demand on the electric grid is increased
through electrification, efficiency can reduce the negative impacts of additional electricity demand on the grid,
reducing the need for increased generation and storage capacity, as well as the need to upgrade upstream
transmission and distribution equipment. The Reach Codes Team recommends that jurisdictions adopting an
all-electric reach code for single family buildings also include an efficiency requirement with EDR2 margins
consistent with the all-electric code minimum package.
• The code compliance margins for the ADU all-electric code minimum package are lower than for the single
family prototype and code compliance can be more challenging for smaller dwelling units. As a result, the
Reach Codes Team does not recommend an additional efficiency requirement for all-electric ADU ordinances.
• Electrification combined with increased PV capacity results in utility cost savings and was found to be On-Bill
cost effective in all cases. These results were based on today’s net energy metering rules and do not account
for future changes to utility agreements, which are expected to decrease the value of PV to the consumer.
• For jurisdictions interested in a reach code that allows for mixed fuel buildings, the mixed fuel efficiency, PV,
and battery package was found to be cost effective based on TDV in all cases. Cost effectiveness was
marginal because of the high cost of the battery system. EDR2 margins ranged from 7 to 30 for the cost-
effective packages.
• Applying the CARE rates has the overall impact to increase utility cost savings for an all-electric building
compared to a code compliant mixed fuel building, improving On-Bill cost-effectiveness.
This report presents measures or measure packages that local jurisdictions may consider adopting to achieve energy
savings and emissions reductions beyond what will be accomplished by enforcing minimum state requirements, the
2022 Building Energy Efficiency Standards (Title 24, Part 6), effective January 1, 2023.
Local jurisdictions may also adopt ordinances that amend different Parts of the California Building Standards Code or
may elect to amend other state or municipal codes. The decision regarding which code to amend will determine the
specific requirements that must be followed for an ordinance to be legally enforceable. Reach codes that amend Part 6
of the CA Building Code and require energy performance beyond state code minimums must demonstrate the
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Cost-Effectiveness Analysis: Single Family New Construction
Executive Summary 2
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
proposed changes are cost-effective and obtain approval from the Energy Commission. Although a cost-effectiveness
study is only required to amend Part 6 of the CA Building Code, this study provides valuable context for jurisdictions
pursuing other ordinance paths to understand the economic impacts of any policy decision. This study documents the
estimated costs, benefits, energy impacts and greenhouse gas emission reductions that may result from implementing
an ordinance based on the results to help residents, local leadership, and other stakeholders make informed policy
decisions.
Model ordinance language and other resources are posted on the C&S Reach Codes Program website at
LocalEnergyCodes.com. Local jurisdictions that are considering adopting an ordinance may contact the program for
further technical support at info@localenergycodes.com.
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Cost-Effectiveness Analysis: Single Family New Construction
Introduction 3
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
1 Introduction
This report documents cost-effective combinations of measures that exceed the minimum state requirements, the 2022
Building Energy Efficiency Standards, effective January 1, 2023, for newly constructed single family buildings. This
report was developed in coordination with the California Statewide Investor-Owned Utilities (CA IOUs) Codes and
Standards Program, key consultants, and engaged cities—collectively known as the Reach Codes Team.
The analysis considers traditional detached single family and detached accessory dwelling unit (ADUs) building types
and evaluates mixed fuel and all-electric package options in all sixteen California climate zones (CZs).1 Packages
include combinations of efficiency measures, on-site renewable energy, and battery energy storage.
The California Building Energy Efficiency Standards Title 24, Part 6 (Title 24) (California Energy Commission, 2021a) is
maintained and updated every three years by two state agencies: the California Energy Commission (Energy
Commission) and the Building Standards Commission (BSC). In addition to enforcing the code, local jurisdictions have
the authority to adopt local energy efficiency ordinances—or reach codes—that exceed the minimum standards defined
by Title 24 (as established by Public Resources Code Section 25402.1(h)2 and Section 10-106 of the Building Energy
Efficiency Standards). Local jurisdictions must demonstrate that the requirements of the proposed ordinance are cost-
effective and do not result in buildings consuming more energy than is permitted by Title 24. In addition, the jurisdiction
must obtain approval from the Energy Commission and file the ordinance with the BSC for the ordinance to be legally
enforceable.
The Department of Energy (DOE) sets minimum efficiency standards for equipment and appliances that are federally
regulated under the National Appliance Energy Conservation Act, including heating, cooling, and water heating
equipment (E-CFR, 2020). Since state and local governments are prohibited from adopting higher minimum efficiencies
than the federal standards require, the focus of this study is to identify and evaluate cost-effective packages that do not
include high efficiency heating, cooling, and water heating equipment. High efficiency appliances are often the easiest
and most affordable measures to increase energy performance. While federal preemption limits reach code mandatory
requirements for covered appliances, in practice, builders may install any package of compliant measures to achieve
the performance requirements.
1 See Appendix 7.1 Map of California Climate Zones for a graphical depiction of climate zone locations.
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Cost-Effectiveness Analysis: Single Family New Construction
Methodology and Assumptions 4
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
2 Methodology and Assumptions
2.1 Analysis for Reach Codes
This section describes the approach to calculating cost-effectiveness including benefits, costs, metrics, and utility rate
selection.
2.1.1 Modeling
The Reach Codes Team performed energy simulations using software approved for 2022 Title 24 Code compliance
analysis, CBECC-Res 2022.1.0.
The general approach applied in this analysis is to evaluate performance and determine cost effectiveness of various
energy efficiency upgrade measures, individually and as packages, in single family buildings. Using the 2022 baseline
as the starting point, prospective measures and packages were identified and modeled in each of the prototypes to
determine the projected energy (therm and kWh) and compliance impacts. A large set of parametric runs were
conducted to evaluate various options and develop packages of measures that met or exceeded minimum code
performance. The analysis utilized a Python based parametric tool to automate and manage the generation of CBECC-
Res input files. This allowed for quick evaluation of various efficiency measures across multiple climate zones and
prototypes and improved quality control. The batch process functionality of CBECC-Res was utilized to simulate large
groups of input files at once.
2.1.2 Cost-Effectiveness
2.1.2.1 Benefits
This analysis used two different metrics to assess cost effectiveness of the proposed upgrades. Both methodologies
require estimating and quantifying the incremental costs and energy savings associated with each energy efficiency
measure. The main difference between the methodologies is the manner in which they value energy and thus the cost
savings of reduced or avoided energy use:
Utility Bill Impacts (On-Bill): Customer-based lifecycle cost (LCC) approach that values energy based upon
estimated site energy usage and customer utility bill savings using today’s electricity and natural gas utility tariffs. Total
savings are estimated over a 30-year duration and include discounting of future costs and energy cost inflation.
Time Dependent Valuation (TDV): Energy Commission LCC methodology, which is intended to capture the total
value or cost of energy use over 30 years. This method accounts for long-term projected costs, such as the cost of
providing energy during peak periods of demand and other societal costs, such as projected costs for carbon
emissions, as well as grid transmission and distribution impacts. This metric values energy use differently depending
on the fuel source (natural gas, electricity, and propane), time of day, and season. For example, electricity used (or
saved) during peak periods has a much higher value than electricity used (or saved) during off-peak periods due to the
less inefficient energy generation sources providing peak electricity (Horii, Cutter, Kapur, Arent, & Conotyannis, 2014).
This is the methodology used by the Energy Commission in evaluating cost effectiveness for efficiency measures in
Title 24, Part 6.
2.1.2.2 Costs
The Reach Codes Team assessed the incremental costs of the measures and packages over a 30-year lifecycle.
Incremental costs represent the equipment, installation, replacements, and maintenance costs of the proposed
measure relative to the 2022 Title 24 Standards minimum requirements or standard industry practices. Present value of
replacement cost is included for measures with lifetimes less than the evaluation period.
In calculating On-Bill cost effectiveness, incremental first costs were assumed to be financed into a mortgage or loan
with a 30-year loan term and four percent interest rate. Financing was not applied to future replacement or
maintenance costs. In calculating TDV cost effectiveness, incremental first costs were not assumed to be financed into
a mortgage or loan.
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Cost-Effectiveness Analysis: Single Family New Construction
Methodology and Assumptions 5
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
2.1.2.3 Metrics
Cost-effectiveness is presented using net present value (NPV) and benefit-to-cost (B/C) ratio metrics.
NPV Savings: The lifetime NPV savings is reported as a cost-effectiveness metric, Equation 1 demonstrates how this
is calculated. If the net savings of a measure or package is positive, it is considered cost-effective. Negative savings
represent net costs.
B/C Ratio: Ratio of the present value (PV) of all benefits to the present value of all costs over 30 years (PV benefits
divided by PV costs). The criteria benchmark for cost effectiveness is a B/C ratio greater than one. A value of one
indicates the NPV of the savings over the life of the measure is equivalent to the NPV of the lifetime incremental cost of
that measure. A value greater than one represents a positive return on investment. The B/C ratio is calculated
according to Equation 2.
Equation 1 𝑁𝑁𝑁𝑁𝑁𝑁 𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆=𝑁𝑁𝑁𝑁 𝑜𝑜𝑜𝑜 𝑙𝑙𝑆𝑆𝑜𝑜𝑙𝑙𝑙𝑙𝑆𝑆𝑙𝑙𝑙𝑙 𝑏𝑏𝑙𝑙𝑆𝑆𝑙𝑙𝑜𝑜𝑆𝑆𝑙𝑙−𝑁𝑁𝑁𝑁 𝑜𝑜𝑜𝑜 𝑙𝑙𝑆𝑆𝑜𝑜𝑙𝑙𝑙𝑙𝑆𝑆𝑙𝑙𝑙𝑙 𝑐𝑐𝑜𝑜𝑆𝑆𝑙𝑙
Equation 2 𝐵𝐵𝑙𝑙𝑆𝑆𝑙𝑙𝑜𝑜𝑆𝑆𝑙𝑙−𝑙𝑙𝑜𝑜−𝐶𝐶𝑜𝑜𝑆𝑆𝑙𝑙 𝑅𝑅𝑆𝑆𝑙𝑙𝑆𝑆𝑜𝑜=𝑁𝑁𝑁𝑁 𝑜𝑜𝑜𝑜 𝑙𝑙𝑆𝑆𝑜𝑜𝑙𝑙𝑙𝑙𝑆𝑆𝑙𝑙𝑙𝑙 𝑏𝑏𝑙𝑙𝑆𝑆𝑙𝑙𝑜𝑜𝑆𝑆𝑙𝑙𝑁𝑁𝑁𝑁 𝑜𝑜𝑜𝑜 𝑙𝑙𝑆𝑆𝑜𝑜𝑙𝑙𝑙𝑙𝑆𝑆𝑙𝑙𝑙𝑙 𝑐𝑐𝑜𝑜𝑆𝑆𝑙𝑙
Improving the efficiency of a project often requires an initial incremental investment. In most cases the benefit is
represented by annual On-Bill utility or TDV savings, and the cost is represented by incremental first cost and
replacement costs. However, some packages result in initial construction cost savings (negative incremental cost), and
either energy cost savings (positive benefits), or increased energy costs (negative benefits). In cases where both
construction costs and energy-related savings are negative, the construction cost savings are treated as the ‘benefit’
while the increased energy costs are the ‘cost.’ In cases where a measure or package is cost-effective immediately
(i.e., upfront construction cost savings and lifetime energy cost savings), B/C ratio cost effectiveness is represented by
“>1”.
The lifetime costs or benefits are calculated according to Equation 3.
Equation 3 𝑁𝑁𝑁𝑁 𝑜𝑜𝑜𝑜 𝑙𝑙𝑆𝑆𝑜𝑜𝑙𝑙𝑙𝑙𝑆𝑆𝑙𝑙𝑙𝑙 𝑐𝑐𝑜𝑜𝑆𝑆𝑙𝑙 𝑜𝑜𝑜𝑜 𝑏𝑏𝑙𝑙𝑆𝑆𝑙𝑙𝑜𝑜𝑆𝑆𝑙𝑙=�(𝐴𝐴𝑆𝑆𝑆𝑆𝐴𝐴𝑆𝑆𝑙𝑙 𝑐𝑐𝑜𝑜𝑆𝑆𝑙𝑙 𝑜𝑜𝑜𝑜 𝑏𝑏𝑙𝑙𝑆𝑆𝑙𝑙𝑜𝑜𝑆𝑆𝑙𝑙)𝑡𝑡(1 +𝑜𝑜)𝑡𝑡𝑛𝑛
𝑡𝑡=0
Where:
• n = analysis term in years
• r = discount rate
The following summarizes the assumptions applied in this analysis to both methodologies.
• Analysis term of 30 years
• Real discount rate of three percent
TDV is a normalized monetary format and there is a unique procedure for calculating the present value benefit of TDV
energy savings. The present value of the energy cost savings in dollars is calculated by multiplying the TDV savings
(reported by the CBECC-Res simulation software) by a NPV factor developed by the Energy Commission (see (Energy
+ Environmental Economics, 2020)). The 30-year residential NPV factor is $0.173/kTDV kBtu for the 2022 code cycle.
Equation 4 𝑇𝑇𝑇𝑇𝑁𝑁 𝑁𝑁𝑁𝑁 𝑜𝑜𝑜𝑜 𝑙𝑙𝑆𝑆𝑜𝑜𝑙𝑙𝑙𝑙𝑆𝑆𝑙𝑙𝑙𝑙 𝑏𝑏𝑙𝑙𝑆𝑆𝑙𝑙𝑜𝑜𝑆𝑆𝑙𝑙= 𝑇𝑇𝑇𝑇𝑁𝑁 𝑙𝑙𝑆𝑆𝑙𝑙𝑜𝑜𝑆𝑆𝑒𝑒 𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆 ∗ 𝑁𝑁𝑁𝑁𝑁𝑁 𝑜𝑜𝑆𝑆𝑐𝑐𝑙𝑙𝑜𝑜𝑜𝑜
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Cost-Effectiveness Analysis: Single Family New Construction
Methodology and Assumptions 6
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
2.1.3 Utility Rates
In coordination with the CA IOU rate team (comprised of representatives from Pacific Gas and Electric (PG&E),
Southern California Edison (SCE) and San Diego Gas and Electric (SDG&E)) and two Publicly-Owned-Utilities (POUs)
(Sacramento Municipal Utility District (SMUD) and City of Palo Alto Utilities (CPAU)), the Reach Codes Team
determined appropriate utility rates for each climate zone in order to calculate utility costs and determine On-Bill
cost effectiveness for the proposed measures and packages. The utility tariffs, summarized in Table 1, were
determined based on the most prevalent active rate in each territory. Utility rates were applied to each climate zone
based on the predominant IOU serving the population of each zone, with a few climate zones evaluated multiple times
under different utility scenarios. Climate Zones 10 and 14 were evaluated with both SCE/SoCalGas and SDG&E tariffs
since each utility has customers within these climate zones. Climate Zone 5 is evaluated under both PG&E and
SoCalGas natural gas rates. Two POU or municipal utility rates were also evaluated: SMUD in Climate Zone 12 and
CPAU in Climate Zone 4.
First-year utility costs were calculated using hourly electricity and natural gas output from CBECC-Res and applying
the utility tariffs summarized in Table 1. Annual costs were also estimated for customers eligible for the CARE tariff
discounts on both electricity and natural gas bills. Appendix 7.2 Utility Rate Schedules includes details of each utility
tariff. For cases with PV generation, the approved NEM2 tariffs were applied along with minimum daily use billing and
mandatory non-bypassable charges. Future changes to the NEM tariffs are likely and the California Public Utilities
Commission (CPUC) has issued a proposed decision with suggested changes that is expected to be finalized in
2022.2 The ADU was assumed to have separate electric and gas meters from the main house.
Table 1. Utility Tariffs Used Based on Climate Zone
Climate Zones Electric / Gas Utility Electricity Natural Gas
IOUs
1-5,11-13,16 PG&E / PG&E E-TOU Option C G1
5 PG&E / SoCalGas E-TOU Option C GR
6, 8-10, 14, 15 SCE / SoCalGas TOU-D Option 4-9 GR
7, 10, 14 SDG&E / SDG&E TOU-DR-1 GR
POUs
4 CPAU / CPAU E-1 G-2
12 SMUD / PG&E R-TOD (RT02) G1
Utility rates are assumed to escalate over time according to the assumptions from the CPUC 2021 En Banc hearings
on utility costs through 2030 (California Public Utilities Commission, 2021a). Escalation rates through the remainder of
the 30-year evaluation period are based on the escalation rate assumptions within the 2022 TDV factors. See
Appendix 7.2.7 Fuel Escalation Assumptions for details.
2.2 Greenhouse Gas Emissions
The analysis reports the greenhouse gas (GHG) emission estimates based on assumptions within CBECC-Res. There
are 8,760 hourly multipliers accounting for time dependent energy use and carbon based on source emissions,
including renewable portfolio standard projections. There are two strings of multipliers—one for Northern California
2 https://www.cpuc.ca.gov/nemrevisit
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Cost-Effectiveness Analysis: Single Family New Construction
Methodology and Assumptions 7
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
climate zones, and another for Southern California climate zones.3 GHG emissions are reported as average annual
metric tons of CO2 equivalent over the 30-year building lifetime.
2.3 Energy Design Rating
The 2019 Title 24 Code introduced California’s Energy Design Rating (EDR) as the primary metric to demonstrate
compliance with the energy code for single family buildings. This EDR was based on the hourly TDV energy use from a
building that is compliant with the 2006 International Energy Conservation Code (IECC) as the Reference Building. The
Reference Building has an EDR score of 100 while a zero-net energy (ZNE) home has an EDR score of zero. While
the Reference Building is used to set the scale for the rating, the Proposed Design is still compared to the Standard
Design based on the Title 24 prescriptive baseline assumptions to determine compliance.
In the 2022 Title 24 Code a second new EDR metric was introduced based on hourly source energy. The two EDR
metrics are described below:
• EDR1 is calculated based on source energy.
• EDR2 is calculated based on TDV energy.
Furthermore, EDR2 is composed of two components for compliance purposes. The Efficiency EDR2 which represents
the energy efficiency features of a home. The PV/Flexibility EDR2 includes the effects of PV and battery storage
systems. Total EDR2 combines both the Efficiency and PV/Flexibility impacts. While the Efficiency EDR2 does not
include the full impact of a battery system, it can include a self-utilization credit for batteries if certain conditions are
met.
For a new, single family building to comply with the 2022 Title 24 Code, three criteria are required:
1. The Proposed EDR1 must be equal to or less than the EDR1 of the Standard Design, and
2. The Proposed Efficiency EDR2 must be equal to or less than the Efficiency EDR2 of the Standard Design, and
3. The Proposed Total EDR2 must be equal to or less than the Total EDR2 of the Standard Design.
This concept, consistent with California’s “loading order” which prioritizes energy efficiency ahead of renewable
generation, requires projects meet a minimum Efficiency EDR2 before PV is credited but allows for PV to be traded off
with additional efficiency when meeting the Total EDR2. A project may improve on building efficiency beyond the
minimum required and subsequently reduce the PV generation capacity necessary to achieve the required Total EDR2.
However, it may not increase the size of the PV system and trade this off with a reduction of efficiency measures.
Results from this analysis are presented as EDR Margin, a reduction in the EDR score relative to the Standard Design.
EDR Margin is a better metric to use than absolute EDR in the context of a reach code because absolute values vary
based on the home design and characteristics such as size and orientation. Referencing the margin results in similar
requirements across a variety of designs. This approach aligns with how compliance is reported for the 2019 and 2022
Title 24 Code. The EDR Margin is calculated according to Equation 5.
Equation 5 𝐸𝐸𝑇𝑇𝑅𝑅 𝑀𝑀𝑆𝑆𝑜𝑜𝑆𝑆𝑆𝑆𝑆𝑆=𝑆𝑆𝑙𝑙𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑜𝑜𝑆𝑆 𝑇𝑇𝑙𝑙𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆 𝐸𝐸𝑇𝑇𝑅𝑅−𝑁𝑁𝑜𝑜𝑜𝑜𝑃𝑃𝑜𝑜𝑆𝑆𝑙𝑙𝑆𝑆 𝑇𝑇𝑙𝑙𝑆𝑆𝑆𝑆𝑆𝑆𝑆𝑆 𝐸𝐸𝑇𝑇𝑅𝑅
3 CBECC-Res multipliers are the same for CZs 1-5 and 11-13 (Northern California), while there is another set of multipliers for CZs
6-10 and 14-16 (Southern California).
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3 Prototypes, Measure Packages, and Costs
This section describes the prototypes and the scope of analysis drawing from previous 2019 Reach Code research
where necessary.
3.1 Prior Reach Code Research
In 2019, the Reach Codes Team analyzed the cost-effectiveness of residential single family new construction projects
for mixed-fuel and all-electric packages (Statewide Reach Codes Team, 2019). Using this analysis, several cities and
counties in California adopted local energy code amendments encouraging or requiring that low-rise residential new
construction be all-electric. As there were few changes to the single family requirements, this analysis for the 2022
code cycle leveraged the work completed for the 2019 reports. Initial efficiency packages were based on the final
packages from the 2019 research and were revised to reflect measure specifications and costs based on new data.
3.2 Prototype Characteristics
The Energy Commission defines building prototypes which it uses to evaluate the cost-effectiveness of proposed
changes to Title 24 requirements. For the 2022 code cycle the Energy Commission used two single family prototypes,
both of which were used in this analysis. Additional details on the prototypes can be found in the Alternative Calculation
Method (ACM) Approval Manual (California Energy Commission, 2018).
Additionally, a detached new construction ADU prototype was developed to reflect recent trends in California
construction related to the high cost of housing (TRC, 2021). ADUs are additional dwelling units typically built on the
property of an existing single-family parcel. ADUs are defined as new construction in the energy code when they are
ground-up developments, do not convert an existing space to livable space, and are not attached to the primary
dwelling. The evaluated prototype is not representative of an attached ADU constructed as an addition to an existing
home.
The Reach Codes Team leveraged prior research to define the detached ADU baseline and measure packages. The
house size and number of bedrooms were based on data from a survey conducted by UC Berkeley’s Center for
Community Innovation (UC Berkeley Center for Community Innovation, 2021). The survey found that the average
square footage for new ADUs statewide is 615 square feet and that the majority (61 percent) of new ADUs have one
bedroom.
Table 2 describes the basic characteristics of each prototype. The prototypes have equal geometry on all walls,
windows and roof to be orientation neutral.
Table 2: Prototype Characteristics
Characteristic Single Family
One-Story
Single Family
Two-Story ADU
Conditioned Floor Area 2,100 ft2 2,700 ft2 625 ft2
Num. of Stories 1 2 1
Num. of Bedrooms 3 3 1
Window-to-Floor Area Ratio 20% 20% 20%
The Energy Commission’s protocol for the two single family prototypes is to weight the simulated energy impacts by a
factor that represents the distribution of single-story and two-story homes being built statewide. This study assumed 50
percent single-story and 50 percent two-story. Simulation results in this study are characterized according to this ratio,
which is approximately equivalent to a 2,400-square foot (ft2) house.4 ADU results are presented separately.
42,400 ft2 = (50% x 2,100 ft2) + (50% x 2,700 ft2)
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The methodology used in the analyses for each of the prototypical building types begins with a design that precisely
meets the minimum 2022 prescriptive requirements (zero compliance margin). Table 150.1-A in the 2022 Standards
(California Energy Commission, 2021a) lists the prescriptive measures that determine the baseline design in each
climate zone. Other features are consistent with the Standard Design in the ACM Reference Manual (California Energy
Commission, 2022), and are designed to meet, but not exceed, the minimum requirements. Each prototype building
has the following features:
• Slab-on-grade foundation.
• Vented attic.
• High performance attic in climate zones where prescriptively required (CZ 4, 8-16) with insulation installed at
the ceiling and below the roof deck per Option B. (Refer to Table 150.1-A in the 2022 Standards.)
• Ductwork located in the attic.
Table 3 describes additional characteristics as they were applied to the base case energy model in this analysis. In a
shift from the 2019 Standards, the 2022 Standards define a prescriptive fuel source for space heating and water
heating establishing a heat pump baseline. In each climate zone one heat pump is prescriptively required. In most
climate zones the prescriptive base case includes a heat pump water heater and a natural gas furnace for space
heating. In Climate Zones 3, 4, 13, and 14 this is reversed, where the base case has a heat pump space heater and
natural gas tankless water heater.
Table 3: Base case Characteristics of the Prototypes
Characteristic Single Family ADU
Space
Heating/Cooling1,2
CZs 1-2,5-12,15-16: Natural gas furnace, split
AC 80 AFUE, 14 SEER, 11.7 EER
CZs 3-4,13-14: Split heat pump – 8.2 HSPF,
14 SEER, 11.7 EER
Same as single family
Water Heater1,2
CZs 1-2,5-12,15-16: Heat pump water heater
(HPWH) UEF = 2.0 located in the garage
CZs 3-4,13-14: Natural gas tankless –
UEF = 0.81
Same equipment type as SF
except HPWH is located inside
the conditioned space with the
supply air ducted from outside3
Hot Water
Distribution
Code minimum, all hot water lines insulated
CZs 1,16: Basic compact distribution credit Same as single family
Drain Water Heat
Recovery Efficiency CZ 16: 65%, equal flow to shower & water heater Same as single family
Cooking Natural Gas Same as single family
Clothes Drying Natural Gas Same as single family
PV System
Sized to offset 100% of electricity use for space
cooling, ventilation, lighting, appliance, & other
miscellaneous electric loads. Size differs by
climate zone ranging from 2.64 kW to 5.33 kW,
see Table 4.
PV is not required when the PV
system size required based on the
prescriptive calculations is less
than 1.8 kW, as is the case in
Climate Zones 1-9, 12, 14, and
16. In the other climate zones the
PV size ranges from 1.74 kW to
2.56 kW, see Table 4.4
1 Equipment efficiencies are equal to minimum federal appliance efficiency standards.
2 AFUE = annual fuel utilization efficiency. SEER = seasonal energy efficiency ratio. EER = energy efficiency ratio.
HSPF = heating seasonal performance factor. UEF = uniform energy factor.
3 This version of CBECC-Res used in this analysis did not have the capability to directly model ducted HPWHs even though this
configuration is called out as the Standard Design in the 2022 ACM (California Energy Commission, 2022). This was
modeled by indicating that the tank is located within the conditioned space with the compressor unit located outside.
4 Exception 2 to Section 150.1(c)14 states that “no PV system is required when the minimum PV system size specified by
section 150.1(c)14 is less than 1.8 kWdc.” In this analysis this exception is applied based on the sizes calculated per
Equation150.1-C of Section 150.1(c)14. The performance software sizes the PV system based on the estimated energy use,
which differs slightly from the prescriptive sizing. As a result, the baseline PV capacity from the performance software for
Climate Zone 10 is less than 1.8 kWdc.
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Table 4 summarizes the PV capacities for the base case packages.
Table 4: Base Package PV Capacities (kW-DC)
Climate
Zone
Base Package
Single
Family ADU
CZ01 3.54 0
CZ02 2.99 0
CZ03 2.81 0
CZ04 2.90 0
CZ05 2.62 0
CZ06 2.64 0
CZ07 2.84 0
CZ08 3.13 0
CZ09 2.97 0
CZ10 3.19 1.74
CZ11 3.91 2.07
CZ12 3.12 0
CZ13 4.08 2.11
CZ14 3.16 0
CZ15 5.33 2.56
CZ16 2.90 0
3.3 Measure Definitions and Costs
Measures evaluated in this study fall into two categories: those associated with general efficiency, onsite generation,
and demand flexibility and those associated with building electrification. The Reach Codes Team selected measures
based on cost-effectiveness as well as decades of experience with residential architects, builders, and engineers along
with general knowledge of the relative consumer acceptance of many measures.
The following sections describe the details and incremental cost assumptions for each of the measures. Incremental
costs represent the equipment, installation, replacement, and maintenance costs of the proposed measures relative to
the base case.5 Replacement costs are applied for roofs, mechanical equipment, PV inverters and battery systems
over the 30-year evaluation period. Maintenance costs are estimated for PV systems, but not any other measures.
Costs were estimated to reflect costs to the building owner. All costs are provided as present value in 2023 (2023
PV$).
The Reach Codes Team obtained measure costs from distributors, contractors, literature review, and online sources
such as Home Depot and RS Means. Contractor markups are incorporated. These are the Reach Codes Team best
estimate of average costs statewide. However, it's recognized that local costs may differ, and that inflation and supply
chain issues may also impact costs.
3.3.1 Efficiency, Solar PV, and Batteries
Following are descriptions of each of the efficiency, PV, and battery measures evaluated under this analysis and
applied in at least one of the packages presented in this report. Table 5 summarizes the incremental cost assumptions
for each of these measures.
5 All first costs are assumed to be financed in a mortgage and interest costs due to financing are included in the
incremental costs. See Section 2.1.2 for details.
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Reduced Infiltration (ACH50): Reduce infiltration in single family homes from the default infiltration assumption of five
(5) air changes per hour at 50 Pascals (ACH50)6 by 40 percent to 3 ACH50. HERS rater field verification and
diagnostic testing of building air leakage according to the procedures outlined in the 2022 Reference Appendices
RA3.8 (California Energy Commission, 2021b).
Lower U-Factor Fenestration: Reduce window U-factor to 0.24. The prescriptive U-factor is 0.30 in all climates.
Higher SHGC Fenestration: Increase solar heat gain coefficient (SHGC) to 0.50 in climate zones where heating loads
dominate. The baseline solar heat gain coefficient (SHGC) applied in the Standard Design is 0.35 in Climate Zones 1,
3, 5, and 16.
Cool Roof: Install a roofing product that’s rated by the Cool Roof Rating Council to have an aged solar reflectance
(ASR) equal to or greater than 0.25. Steep-sloped roofs were assumed in all cases. The 2022 Title 24 specifies a
prescriptive ASR of 0.20 for Climate Zones 10 through 15.
Increased Ceiling Insulation: Increase ceiling level insulation in a vented attic to R-49 or R-60 insulation.
Slab Insulation: Install R-10 perimeter slab insulation at a depth of 16-inches. This measure doesn’t apply to Climate
Zone 16 where slab insulation is required prescriptively.
Low Pressure Drop Ducts: Upgrade the duct distribution system to reduce external static pressure and meet a
maximum fan efficacy of 0.35 Watts per cfm. This may involve upsizing ductwork, reducing the total effective length of
ducts, and/or selecting low pressure drop components such as filters. Fan watt draw must be verified by a HERS rater
according to the procedures outlined in the 2022 Reference Appendices RA3.3 (California Energy Commission,
2021b).
Buried Radial Duct Design: Bury all ductwork in ceiling insulation by laying the ducts across the ceiling joists or in-
between ceiling joists directly on the ceiling drywall. Duct design is based on a radial design where individual ducts are
run to each supply register. This allows for smaller diameter ducts, reducing duct losses and more easily meeting fully
or deeply buried conditions.7 Duct burial and duct system design must be verified by a HERS rater according to the
procedures outlined in the 2022 Reference Appendices RA3.1.4.1.5 and RA3.1.4.1.6 (California Energy Commission,
2021b). This applies to the single family prototypes only.
R-8 Duct Insulation: Increase duct insulation to R-8 in the climate zones where R-6 insulation is prescriptive.
Ductless Mini-Split Heat Pump: In the ADU prototype replace the ducted split system with a ductless mini-split heat
pump with three indoor heads. The system is evaluated as meeting the criteria for the variable capacity heat pump
(VCHP) credit, introduced in the 2019 code cycle, which must be verified by a HERS rater according to the procedures
outlined in the 2022 Reference Appendices RA3.4.4.3 (California Energy Commission, 2021b). This credit requires
verification of refrigerant charge, that all equipment is entirely within conditioned space, that airflow is directly supplied
to all habitable space and that wall mounted thermostats serve any zones greater than 150 square feet.
Compact Hot Water Distribution: Design the hot water distribution system to meet minimum requirements for the
basic compact hot water distribution credit according to the procedures outlined in the 2022 Reference Appendices
RA4.4.6 (California Energy Commission, 2021b). In many single family homes this may require moving the water
heater from an exterior to an interior garage wall. CBECC-Res software assumes a 30% reduction in distribution losses
for the basic credit.
Solar PV: Installation of on-site PV is required in the 2022 residential code unless an exception is met. The PV sizing
methodology in each package was developed to offset annual building electricity use and avoid oversizing which would
6 Whole house leakage tested at a pressure difference of 50 Pascals between indoors and outdoors.
7 The duct systems in the Central Valley Research Homes Project Final Project Report are illustrative of this approach
(Proctor, Wilcox, & Chitwood, 2018).
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
violate net energy metering (NEM) rules.8 In all cases, PV is evaluated in CBECC-Res according to the California
Flexible Installation (CFI) assumptions.
The Reach Codes Team used two options within the CBECC-Res software for sizing the PV system, described below.
The first option, “Standard Design PV”, was applied in the base case simulations and packages where the PV system
size was not changed from the minimum system size required. For the PV packages, the second option was used with
a scaling of 100 percent. The Reach Codes Team evaluated an all-electric single family and ADU home with a PV
system sized to offset 100 and 90 percent of the total calculated electricity use. Sizing to 100 percent proved to be
more cost-effective based on customer utility bills in most cases. As a result, the PV packages were sized to offset 100
percent of electricity use.
• Standard Design PV – the same PV capacity as is required for the Standard Design case 9
• Specify PV System Scaling – a PV system sized to offset a specified percentage of the estimated electricity
use of the Proposed Design case
One exception to the PV requirement is when the minimum PV system size required is less than 1.8 kWh. This
exception applies to the ADU models in Climate Zones 1-9, 12, 14, and 16. For these cases no PV system is required
by code and no PV system was modeled in the base case simulations.
Battery Energy Storage: A battery system was evaluated in CBECC-Res with control type set to “Advanced Demand
Response Control” and with default efficiencies of 95% for both charging and discharging. The “Advanced Demand
Response Control” option assumes the battery system will charge or discharge depending on the needs of the grid. To
qualify for the Advanced Demand Response Control the battery system must meet the requirements outlined in the
2022 Reference Appendices JA13.3.3.2 (California Energy Commission, 2021b).
8 NEM rules apply to the IOU territories only.
9 The Standard Design PV system is sized to offset the electricity use of the building loads which are typically electric in
a mixed fuel home, which includes all loads except space heating, water heating, clothes drying, and cooking.
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Table 5: Incremental Cost Assumptions
Measure
Performance
Level
Incremental Cost
(2023 PV$)1
Source & Notes
Single
Family ADU
Non-Preempted Measures
Reduced
Infiltration
3.0 vs 5.0
ACH50 $591 $362 $0.115/ft2 based on NREL’s BEopt cost database plus $250 HERS rater verification.
Window U-factor 0.24 vs 0.30 $2,280 $285 $4.23/ft2 window area based on analysis conducted for the 2019 and 2022 Title 24 cycles
(Statewide CASE Team, 2018).
Window SHGC 0.50 vs 0.35 $0 $0 Based on feedback from Statewide CASE Team that higher SHGC does not necessarily
have any incremental cost (Statewide CASE Team, 2017).
Cool Roof
0.25 vs 0.20
aged solar
reflectance
$219 $53
$0.07per ft2 of roof area first incremental cost for asphalt shingle product based on the 2022
Nonresidential High Performance Envelope CASE Report (Statewide CASE Team, 2020a).
Total costs assume present value of replacement at year 20 and residual cost for remaining
product life at end of 30-year analysis period. Higher reflectance values for lower cost are
achievable for tile roof products
Attic Insulation
R-49 vs R-30 $872 n/a
Based on costs from the 2022 Residential Additions & Alterations CASE Report (Statewide
CASE Team, 2020b).
R-60 vs R-30 $1,420 n/a
R-60 vs R-38 $1,096 n/a
Slab Edge
Insulation R-10 vs R-0 $651 $449 $4 per linear foot of slab perimeter based on internet research. Assumes 16in depth.
Low Pressure
Drop Ducts
0.35 vs 0.45
W/cfm $99 $49
Costs assume one-hour labor for single family and half-hour for the ADU. Labor rate of $88
per hour is from 2022 RS Means for sheet metal workers and includes a weighted average
City Cost Index for labor for California.
Buried Ducts Buried, radial
design $281 n/a
No cost for laying ducts on attic floor versus suspending, in some cases there will be cost
savings. Neutral cost for radiant design versus trunk and branch design. A $250 HERS Rater
verification fee is included.
Duct Insulation R-8 vs R-6 $201 n/a Based on costs from the 2022 Residential Additions & Alterations CASE Report (Statewide
CASE Team, 2020b).
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Measure
Performance
Level
Incremental Cost
(2023 PV$)1
Source & Notes
Single
Family ADU
Ductless Mini-
Split Heat Pump
Ductless system
meeting the
VCHP credit vs.
ducted split heat
pump
n/a $1,571
Costs were developed based on data from E3’s 2019 report Residential Building
Electrification in California (Energy & Environmental Economics, 2019) and the 2022 All-
Electric Multifamily CASE Report (Statewide CASE Team, 2020c). Equipment costs are from
the CASE Report for the 10-story multifamily prototype assuming similar sized equipment
between the multifamily dwelling unit and the ADU. Thermostat, wiring, electrical, and
ducting costs are from the E3 study. A $250 HERS Rater verification fee is also included.
Where this measure is applied to the mixed fuel home with a gas furnace, this cost is in
addition to the cost difference for a heat pump versus a gas furnace/split AC reported in
Section 3.3.2.
Compact Hot
Water
Distribution
Basic credit –
homes with gas
tankless
$196 $0
For single family homes with a gas tankless water heater (mixed fuel homes in Climate
Zones 3,4,13,14) assumes adding 20-feet venting at $14.69 per linear foot to locate water
heater on interior garage wall, less 20-feet savings for PEX and pipe insulation at $5.98 per
linear foot. Costs from online retailers. For single family homes with a HPWH there is an
incremental cost savings from less pipe being required. For the ADU it is assumed the credit
can be met without any changes to design and there is no cost impact.
Basic credit –
homes with
HPWH
$-134 $0
PV + Battery
PV System
First Cost $3.21/W $3.21/W
First costs from LBNL’s Tracking the Sun 2021 costs (Barbose, Darghouth, O'Shaughnessy,
& Forrester, 2021) and represent median costs in California in 2020 of $3.90/WDC for
residential systems. The first cost was reduced by the solar energy Investment Tax Credit of
30%.2 Costs are presented as the average of 2023, 2024, and 2025.
Inverter replacement cost of $0.14/WDC present value includes replacements at year 11 at
$0.15/WDC (nominal) and at year 21 at $0.12/WDC (nominal) per the 2019 PV CASE Report
(California Energy Commission, 2017).
System maintenance costs of $0.31/WDC present value assume $0.02/WDC (nominal)
annually per the 2019 PV CASE Report (California Energy Commission, 2017).
Inverter
replacement $0.14/W $0.14/W
Maintenance $0.31/W $0.31/W
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Measure
Performance
Level
Incremental Cost
(2023 PV$)1
Source & Notes
Single
Family ADU
Battery
First cost $617/kWh $617/kWh
Costs are based on research conducted for the 2021 Batteries in Single Family Homes reach
code report (Statewide Reach Codes Team, 2021a). $1,000/kWh first cost in 2020 based on
Self-Generation Incentive Program (SGIP) residential participant cost data. To estimate the
first cost in future years this was reduced by 7% annually based on SDG&E’s Behind-the-
Meter Battery Market Study (E-Source companies, 2020). The first cost is reduced by the
solar energy Investment Tax Credit of 30%.2 Costs are presented as the average of 2023,
2024, and 2025. No SGIP incentives are included.
Replacement cost at year 10 and 20 was calculated based on the 2023 cost reduced by 7%
annually over the next 10 years for a future value cost of $389 (present value of $290 in year
10 and $216 in year 20).
Replacement
cost $505/kWh $505/kWh
1All first costs are assumed to be financed in a mortgage and interest costs due to financing are included in the incremental costs. See Section 2.1.2 for details.
Interest costs were not included for calculating TDV cost-effectiveness.
2As part of the Inflation Reduction Act in August 2022 the Section 25D Investment Tax Credit was extended and raised to 30% through 2032 with a step-down
beginning in 2033. https://www.seia.org/sites/default/files/2022-08/Inflation%20Reduction%20Act%20Summary%20PDF%20FINAL.pdf
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3.3.2 All-Electric
This analysis compared a code compliant mixed fuel prototype, which uses natural gas for three appliances (cooking,
clothes drying and either space heating or water heating), with a code compliant all-electric prototype. In these cases,
the relative costs between natural gas and electric appliances, differences between in-house electricity and natural gas
infrastructure and the associated infrastructure costs for providing natural gas to the building were included.
To estimate costs the Reach Codes Team leveraged costs from the 2019 reach code cost-effectiveness studies for
residential new construction (Statewide Reach Codes Team, 2019) and detached accessory dwelling units (Statewide
Reach Codes Team, 2021b), 2022 RS Means, PG&E data, published utility schedules and rules, and online research.
Incremental costs for natural gas infrastructure to a single family building are presented in Table 6 through Table 11.
These costs are applied as cost savings for an all-electric home when compared to a mixed fuel home. This is the
component with the highest degree of variability for all-electric homes. These costs are project dependent and may be
significantly impacted by such factors as utility territory, site characteristics, distance to the nearest natural gas main
and main location, joint trenching, whether work is conducted by the utility or a private contractor, and number of
dwelling units per development. All gas utilities participating in this study were solicited for cost information. The CA
IOU costs for single family homes presented are based primarily on cost data provided by PG&E.
Table 6 presents assumed gas main distribution line extension costs within gas CA IOU territory. Total distribution line
extension costs are based on cost data provided by PG&E for new greenfield development. Total costs are reduced to
account for deductions per the Utility Gas Main Extensions rules.10 These rules categorize distribution line extensions
as “refundable” costs, which are offset or subsidized by all other ratepayers. Refundable costs are first subsidized by
appliance allowances, which are defined in Table 7. If there are additional costs in excess of the allowances, the
developer has the option to either be refunded for the remaining amount over ten years or receive a 50 percent
discount at time of application. The latter discount option is assumed in this analysis and is more commonly used by
developers (California Public Utilities Commission, 2022). Two scenarios are presented in Table 6 since the appliance
allowances differ by type of appliance. One is for the base case home with a prescriptive heat pump space heater
which assumes a gas water heater, gas cooking, and gas clothes dryer (Climate Zones 3, 4, 13, and 14). The second
is for the base case home with a prescriptive heat pump water heater which assumes a gas furnace, gas cooking, and
gas clothes dryer. and a natural gas furnace for space heating (Climate Zones 1, 2, 5 through 12, 15, and 16).
The costs less the deductions were applied under the On-Bill cost-effectiveness methodology. The total costs before
the deductions were applied under the TDV cost-effectiveness methodology to better reflect the full cost of gas main
extensions since the deductions are subsidized by ratepayers and recovered via revenue from customers. This follows
the analysis approach in the 2019 reach code study (Statewide Reach Codes Team, 2019) and was based on input
received from the Energy Commission and agreement from the Reach Codes technical advisory team that the
approach is appropriate. TDV cost savings impacts extend beyond the customer and account for societal impacts of
energy use. Accounting for the full cost of the infrastructure upgrades was determined to be justified when evaluating
under the TDV methodology.
The CPUC issued a Proposed Decision in August 2022 that recommends eliminating the subsidies effective July 1,
2023. At the time of publishing this report there had been no ruling on this decision and therefore this analysis assumes
the existing rules will remain in place through the 2022 code cycle. A sensitivity analysis of how the results would
change if the Proposed Decision were adopted is included in the results of this report.
10 PG&E Rule 15: https://www.pge.com/tariffs/assets/pdf/tariffbook/GAS_RULES_15.pdf.
SoCalGas Rule 20: https://www.socalgas.com/regulatory/tariffs/tm2/pdf/20.pdf.
SDG&E Rule 15: https://tariff.sdge.com/tm2/pdf/GAS_GAS-RULES_GRULE15.pdf.
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Table 6. Single Family IOU Natural Gas Main Distribution Line Extension Costs
Total
Less Gas Extension Rule
Deductions1
PG&E SoCalGas SDG&E
Gas Water Heater Base $1,020 $0 $13 $0
Gas Space Heater Base $0 $0 $0
1After Utility Gas Main Extension Rule deductions.
Table 7. Residential IOU Gas Line Extension Appliance Allowances
Appliance PG&E SoCalGas SDG&E
Water Heating $1,391 $682 $1,138
Space Heating $987 $818 $987
Oven/Range $84 $152 $201
Dryer Stub $24 $160 $289
Total - Gas Water Heater Base $1,499 $994 $1,628
Total – Gas Space Heater Base $1,095 $1,130 $1,477
Table 8 presents costs for the extension of service lines from a main distribution line to the home within gas CA IOU
territory. These costs are based on data provided by PG&E excluding trenching. Costs are presented separately for a
new subdivision in an undeveloped area as well as an infill development. The service extension is typically more costly
in an infill scenario due to the disruption of existing roads, sidewalks, and other structures. For this analysis an average
of the new subdivision and infill development costs was used, representing 80 percent of the new subdivision and 20
percent infill.
Table 8. Single Family IOU Natural Gas Service Line Extension Costs
New
Subdivision
Infill
Development
Average
(80% New, 20% Infill)
$1,300 $6,750 $2,390
Table 9 presents other relative costs within gas CA IOU territory including gas meter installation and IOU plan review.
These costs are based on data provided by PG&E.
Table 9. Single Family IOU Other Natural Gas Infrastructure Costs
Meter $300
Plan Review $850
Table 10 presents total costs including distribution and service line extensions, meter installation and plan review for
the three gas CA IOUs for the two base case scenarios. Costs are based on the average service line extension costs
from Table 8. For the single family analysis, based on the Reach Codes Team's conversations with the industry it is
assumed that no upgrades to the electrical panel are required and that a 200 Amp panel is typically installed for both
mixed fuel and all-electric homes.
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Table 10. Single Family IOU Total Natural Gas Infrastructure Costs1
Total Less Gas Extension Rule
Deductions2
PG&E SoCalGas SDG&E
Total - Gas Water Heater Base $4,560 $3,540 $3,553 $3,540
Total - Gas Space Heater Base $3,540 $3,540 $3,540
1Based on average service line extension costs from Table 8.
1After Utility Gas Main Extension Rule deductions.
CPAU provides gas service to its customers and therefore separate costs were evaluated based on CPAU gas service
connection fees.11 Table 11 presents the breakdown of gas infrastructure costs used in this analysis for CPAU. There
is no main distribution line component since Palo Alto has little greenfield space remaining and most of the
development is infill.
Table 11. Single Family CPAU Total Natural Gas Infrastructure Costs
Item Cost
Service Extension $5,892
Meter $1,012
Plan Review Costs $924
Total $7,828
Table 12 presents incremental costs for natural gas infrastructure for the detached ADU. These costs are directly from
the 2019 detached ADU reach code report (Statewide Reach Codes Team, 2021b) and were obtained from interviews
and RS Means. For the ADU scenario it’s assumed that natural gas already exists on the lot and is being extended to
the location of the ADU typically at the back of the lot. There are incremental cost savings for an all-electric ADU from
not extending the natural gas service; however, there is also a small incremental cost for upgrading the electric service
to accommodate the additional electrical load. The Reach Codes Team found that a new detached ADU would require
that the building owner upgrade the service connection to the lot in both the mixed-fuel ADU design and the all-electric
design. The most common size for this upgrade is to upsize the existing panel to 225A, which would not represent an
incremental cost from the mixed-fuel project to the all-electric project. Feeder wiring to the ADU and the ADU subpanel
will need to be slightly upgraded for the all-electric design.
11 CPAU Schedule G-5 effective 09-01-2019: https://www.cityofpaloalto.org/files/assets/public/utilities/utilities-
engineering/general-specifications/gas-service-connection-fees.pdf
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Table 12. ADU Utility Infrastructure Costs
Mixed Fuel Measure Mixed Fuel
Cost All-Electric Measure All-Electric
Cost
All-Electric
Incremental Cost
Site natural gas service
extension $1,998 No site natural gas service $0 ($1,998)
Site electrical service
connection upgrade 225A $3,500 Site electrical service
connection upgrade 225A $3,500 $0
100A feeder to ADU with
breaker $933 125A feeder to ADU with
breaker $1,206 $273
100A ADU subpanel $733 125A ADU subpanel $946 $213
Totals $7,164 $5,652 ($1,512)
Equipment lifetimes applied in this analysis for the water heating and space conditioning measures are summarized in
Table 13. The lifetime for the heat pump, furnace, and air conditioner are based on the Database for Energy Efficient
Resources (DEER) (California Public Utilities Commission, 2021b). In DEER, heat pump and air conditioner measures
are assigned an effective useful lifetime (EUL) of 15 years and a furnace an EUL of 20 years. The heating and cooling
system components are typically replaced at the same time when one reaches the end of its life and the other is near
it. Therefore, it is assumed that both the furnace and air conditioner are replaced at the same time at year 17.5,
halfway between 15 and 20 years. For HVAC system costing, air-conditioning is included in all cases in both the base
case and proposed models. Present value replacement costs are included in the total lifetime incremental costs.
Table 13: Lifetime of Water Heating & Space Conditioning Equipment Measures
Measure Lifetime
Gas Furnace 17.5
Air Conditioner 17.5
Heat Pump 15
Gas Tankless Water Heater 20
Heat Pump Water Heater 15
Appliance incremental costs are shown in Table 14 and Table 15. Replacement costs are applied to HVAC and DHW
equipment over the 30-year evaluation period. Costs were estimated to reflect costs to the building owner. All costs are
provided as present value in 2023 (2023 PV$). Costs due to variations in furnace, air conditioner, and heat pump
capacity by climate zone were not accounted for.
The Reach Codes Team determined that the typical first installed cost for electric appliances is similar to that for
natural gas appliances. Cost differences include equipment cost and installation, costs for natural gas piping from the
meter to the appliance, and costs for electrical wiring to service the appliances.
Space Heater: Typical HVAC incremental costs were based on material costs from the AC Wholesalers website and
labor costs from 2022 RS Means. In most cases the Reach Codes Team found that the material costs were slightly
higher for the heat pump, but the labor costs were slightly higher for the gas furnace/AC installation. Costs were
calculated for capacities ranging from a 2-ton to a 5-ton and the incremental costs used in this study were based on a
weighted average of the expected nominal capacities from CBECC-Res autosizing results for the 2,100 square foot
prototype. Incremental replacement costs for the heat pump are based on a 17.5-year lifetime for the gas furnace and
air conditioner and a 15-year lifetime for the heat pump. Residual value of the gas furnace/AC at the end of the 30-year
analysis period was accounted for to represent the remaining life of the equipment.
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Water Heater: Various cost sources were reviewed and the Reach Codes Team determined that installed first costs for
a garage installed tankless gas water heater and HPWH are very similar and no incremental cost was applied for the
equipment and installation (see below for details on costs for gas piping and electrical wiring). This accounts for slightly
higher equipment costs for the HPWH but lower installation labor due to the elimination of the combustion gas venting.
Incremental replacement costs account for a 15-year HPWH lifetime and a 20-year lifetime for the gas tankless water
heater. Residual value of the gas tankless at the end of the 30-year analysis period was accounted for to represent the
remaining life of the equipment. For the ADU analysis the water heater is evaluated within the conditioned space with
the supply air ducted from the outside. An HVAC contractor provided a cost estimate for supply air ducting through the
wall in an ADU where the water heater is in an interior room adjacent to an exterior wall. The estimated total cost for
this was $652.
A high efficiency HPWH that meets the Northwest Energy Efficiency Alliance (NEEA)12 Tier 3 rating was also
evaluated. HPWHs certified to meet NEEA Tier 3 or Tier 4 are the dominant product on the market today. According to
NEEA all major HPWH manufacturers are represented in NEEA’s qualified product list 13 and there are only 11 listed
products certified as Tier 1 or Tier 2.14 While the Reach Codes Team evaluated a HPWH that just meets the federal
minimum efficiency standards of close to 2.0 UEF to satisfy federal preemption requirements, the Reach Codes Team
is not aware of any 2.0 UEF products that are available. The Reach Codes Team was unable to find any of the Tier 1
or Tier2 HPWHs for sale online and was unable to find any products for sale online that were not NEEA Tier 3 or Tier 4
certified. As a result, no incremental cost is assumed for a NEEA Tier 3 product versus a federal minimum efficiency
product.
Clothes Dryer and Range: After review of various sources, the Reach Codes Team concluded that the cost difference
between gas and electric resistance equipment for clothes dryers and stoves is negligible and that the lifetimes of the
two technologies are also similar.
Electric Service Upgrade: The 2022 Title 24 Code requires electric readiness for gas appliances; as a result, the
incremental costs to provide electrical service for electric appliances are minimal. The incremental costs accounted for
in this study are calculated as the cost to install 220V service for the electric appliances less the cost for the electric
ready requirements and for installing 110V service for the comparable gas appliance. Incremental costs are applied for
the space heater, water heater, and cooking range. Based on builder surveys, it’s assumed that in a typical mixed fuel
home both electric and gas service are provided to the dryer location and therefore no incremental costs for the dryer
were applied. Costs assume 50A service for the range and 30A service for the space heater and water heater. Costs
are assumed to be the same for the single family and ADU analyses.
In-House Natural Gas Infrastructure (from meter to appliances): Installation cost to run a natural gas line from the
meter to the appliance location was estimated at $580 per appliance. These costs were based on material costs from
Home Depot and labor costs from 2022 RS Means. The material costs were about 1/3 higher in RS Means than Home
Depot, so the Reach Codes Team used the lower costs from Home Depot. The Reach Codes Team conducted a pipe
sizing analysis for the two single family and one ADU prototype homes to estimate the length and diameter of gas
piping required assuming the home included a gas furnace, gas tankless water heater, gas range, and gas dryer. Total
estimated costs were very similar for each of the three prototypes and an average cost per appliance of $580 was
determined. Costs are assumed to be the same for the single family and ADU analyses.
12 Based on operational challenges experienced in the past, NEEA established rating test criteria to ensure newly
installed HPWHs perform adequately, especially in colder climates. The NEEA rating requires products comply with
ENERGY STAR and includes requirements regarding noise and prioritizing heat pump use over supplemental electric
resistance heating.
13 https://neea.org/success-stories/heat-pump-water-heaters
14 https://neea.org/img/documents/residential-unitary-HPWH-qualified-products-list.pdf
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Table 14. Single Family All-Electric Appliance Incremental Costs
Measure
Incremental Cost (2023 PV$)
First Cost Replacement
Cost
Total Lifetime
Financed
Heat Pump vs Gas Furnace/Split AC
Equipment & Installation ($151) $703 $533
Electric Service Upgrade $43 $0 $49
In-House Gas Piping ($580) $0 ($651)
Total ($688) $703 ($69)
Heat Pump Water Heater vs Gas Tankless
Equipment & Installation $0 $652 $652
Electric Service Upgrade $43 $0 $49
In-House Gas Piping ($580) $0 ($651)
Total ($537) $652 $49
NEEA Tier 3 HPWH vs Federal Minimum HPWH
Equipment $0 $0 $0
Total $0 $0 $0
Electric Resistance vs Gas Cooking
Equipment & Installation $0 $0 $0
Electric Service Upgrade $100 $0 $113
In-House Gas Piping ($580) $0 ($651)
Total ($480) $0 ($539)
Electric Resistance vs Gas Clothes Drying
Equipment & Installation $0 $0 $0
Electric Service Upgrade $0 $0 $0
In-House Gas Piping ($580) $0 ($651)
Total ($580) $0 ($651)
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Table 15. ADU All-Electric Appliance Incremental Costs
Measure
Incremental Cost (2023 PV$)
First Cost Replacement
Cost
Total Lifetime
Financed
Heat Pump vs Gas Furnace/Split AC
Equipment & Installation ($151) $703 $533
Electric Service Upgrade $43 $0 $49
In-House Gas Piping ($580) $0 ($651)
Total ($688) $703 ($69)
Heat Pump Water Heater vs Gas Tankless
Equipment & Installation $652 $652 $1,384
Electric Service Upgrade $43 $0 $49
In-House Gas Piping ($580) $0 ($651)
Total $115 $652 $781
NEEA Tier 3 HPWH vs Federal Minimum HPWH
Equipment $0 $0 $0
Total $0 $0 $0
Electric Resistance vs Gas Cooking
Equipment & Installation $0 $0 $0
Electric Service Upgrade $100 $0 $113
In-House Gas Piping ($580) $0 ($651)
Total ($480) $0 ($539)
Electric Resistance vs Gas Clothes Drying
Equipment & Installation $0 $0 $0
Electric Service Upgrade $0 $0 $0
In-House Gas Piping ($580) $0 ($651)
Total ($580) $0 ($651)
3.4 Measure Packages
The Reach Codes Team evaluated three packages for mixed fuel homes and five packages for all-electric homes for
each prototype and climate zone, as described below.
1. All-Electric Code Minimum: This package meets all the prescriptive requirements of the 2022 Title 24 Code. In
some instances, the prescriptive minimum package did not comply with code and efficiency measures were
added to meet minimum compliance requirements. The added efficiency measures can be found in Table 45
and Table 46.
2. Efficiency Only: This package uses only efficiency measures that don’t trigger federal preemption issues
including envelope and water heating or duct distribution efficiency measures.
3. Efficiency + NEEA (Preempted): This package was evaluated for the all-electric homes only and shows an
alternative design that applies water heating equipment that is more efficient than federal standards meeting
the NEEA Tier 3 rating. The Reach Codes Team considers this more reflective of how builders meet above
code requirements in practice.
4. Efficiency + PV: Using the Efficiency Package as a starting point, PV capacity was added to offset most of the
estimated electricity use.
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5. Efficiency + PV + Battery: Using the Efficiency & PV Package as a starting point, a battery system was added.
For mixed-fuel homes the package of efficiency measures differed from the Efficiency Package in some
climate zones to arrive at a cost effective solution.
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Cost-Effectiveness Analysis: Single Family New Construction
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4 Results
4.1 2022 Metrics and Compliance
The Reach Codes Team evaluated the compliance impacts of a prescriptive all-electric home as well as a traditional
mixed fuel home with four gas appliances (space heating, water heating, cooking, clothes drying). Compliance is
relative to the 2022 prescriptive base case home with three gas appliances. The impacts for the single family home and
the ADU are presented in Figure 1 and Figure 2, respectively. The all-electric single family home prototype is code
compliant with both EDR1 (source energy) and efficiency EDR2 (TDV energy) in all climate zones except Climate
Zones 15 and 16. In addition to this climate zone, the all-electric ADU is also not compliant in Climate Zones 4 through
10 and 13 through 15. The four gas appliance single family home is presented in Figure 3. This case is not code
compliant in any climate zone.
This analysis illustrates a couple of interesting points. One is that the new 2022 compliance metrics are important
drivers encouraging electrification. The compliance penalties assessed the four gas appliance home scenarios are
significant and will require deep efficiency measures to overcome. Another is that the 2022 Title 24 Code’s new source
energy metric combined with the heat pump baseline encourage all-electric construction, providing a compliance
benefit, at least in larger homes, that allows for some amount of prescriptively required building efficiency to be traded
off and still comply when using the performance method.
Figure 1: Single Family All-Electric Home Compliance Impacts
-5
0
5
10
15
20
25
CZ01 CZ02 CZ03 CZ04 CZ05 CZ06 CZ07 CZ08 CZ09 CZ10 CZ11 CZ12 CZ13 CZ14 CZ15 CZ16EDR MarginAll -Electric Prescrip�ve
Source (EDR1)TDV (EDR 2 Efficiency)
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Figure 2: ADU All-Electric Home Compliance Impacts
Figure 3: Single Family Four Gas Appliance Home Compliance Impacts
-6
-4
-2
0
2
4
6
8
10
12
CZ01 CZ02 CZ03 CZ04 CZ05 CZ06 CZ07 CZ08 CZ09 CZ10 CZ11 CZ12 CZ13 CZ14 CZ15 CZ16EDR MarginAll -Electric Prescrip�ve
Source (EDR1)TDV (EDR2 Efficiency)
-18
-16
-14
-12
-10
-8
-6
-4
-2
0
2
CZ01 CZ02 CZ03 CZ04 CZ05 CZ06 CZ07 CZ08 CZ09 CZ10 CZ11 CZ12 CZ13 CZ14 CZ15 CZ16
EDR MarginMixed Fuel Prescrip�ve, 4 Gas Appliances
Source (EDR1)TDV (EDR2 Efficiency)
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
4.2 All-Electric Code Minimum Results
Table 16 shows results for the single family all-electric code minimum case compared to the 2022 baseline. This package reflects the prescriptive minimum
requirements except in Climate Zones 15 and 16, where efficiency measures were added to meet minimum code compliance. Utility cost savings are negative,
indicating an increase in utility costs for the all-electric building, in all cases except in CPAU and SMUD territories. In all cases the incremental cost is negative,
which reflects a cost savings for the all-electric building due to eliminating the gas infrastructure costs. The package is cost effective based on TDV in all cases;
however, it’s only cost-effective On-Bill in Climate Zones 4 in CPAU territory, 6, 8, 9, 12 in SMUD territory, and 15.
Table 17 shows the all-electric code minimum case results for the ADU. This package reflects the prescriptive minimum requirements except in Climate Zones 4
through 10 and 13 through 16, where efficiency measures were added to meet minimum code compliance. The conclusions related to cost-effectiveness are
similar for the ADU as for the single family analysis.
A summary of measures included in each package is provided in Appendix 7.3 Summary of Measures by Package. The efficiency measures added to the all-
electric package to meet minimum code requirements are described in Table 45 and Table 46.
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Table 16. Single Family Cost-Effectiveness: All-Electric Code Minimum
Climate
Zone
Electric
/Gas Utility
Efficiency
EDR2
Margin
Annual
Elec
Savings
(kWh)
Annual
Gas
Savings
(therms)
Average
Annual GHG
Reductions
(metric tons)
Utility Cost Savings Incremental Cost On-Bill TDV
First
Year
Lifecycle
(2022$)
First
Year
Lifecycle
(2022$)
B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 8.3 -4,628 400 1.5 ($721) ($10,848) ($5,288) ($5,234) 0.5 ($5,614) >1 $5,566
CZ02 PGE 5.7 -3,170 247 0.8 ($581) ($10,060) ($5,288) ($5,234) 0.5 ($4,826) >1 $5,390
CZ03 PGE 4.7 -2,413 171 0.7 ($510) ($9,954) ($5,136) ($5,116) 0.5 ($4,838) 63.5 $4,414
CZ04 PGE 3.7 -2,233 163 0.7 ($455) ($8,756) ($5,136) ($5,116) 0.6 ($3,641) >1 $4,929
CZ04 CPAU 3.7 -2,233 163 0.7 $21 $3,274 ($9,424) ($9,931) >1 $13,205 >1 $9,217
CZ05 PGE 1.1 -2,123 133 0.4 ($452) ($8,930) ($5,288) ($5,234) 0.6 ($3,696) 2.5 $2,776
CZ05 PGE/SCG 1.1 -2,123 133 0.4 ($455) ($9,027) ($5,288) ($5,234) 0.6 ($3,793) 2.5 $2,776
CZ06 SCE/SCG 2.5 -1,481 84 0.3 ($269) ($5,120) ($5,288) ($5,234) 1.0 $115 3.2 $3,142
CZ07 SDGE 2.3 -1,328 69 0.2 ($456) ($10,904) ($5,288) ($5,234) 0.5 ($5,670) 3.1 $3,081
CZ08 SCE/SCG 0.6 -1,331 67 0.2 ($249) ($4,864) ($5,288) ($5,234) 1.1 $371 2.8 $2,951
CZ09 SCE 1.2 -1,513 85 0.3 ($269) ($5,109) ($5,288) ($5,234) 1.0 $126 3.3 $3,179
CZ10 SCE/SCG 1.1 -1,777 107 0.3 ($307) ($5,720) ($5,288) ($5,234) 0.9 ($486) 3.5 $3,285
CZ10 SDGE 1.1 -1,777 107 0.3 ($657) ($15,474) ($5,288) ($5,234) 0.3 ($10,239) 3.5 $3,285
CZ11 PGE 3.5 -2,934 227 0.7 ($444) ($7,106) ($5,288) ($5,234) 0.7 ($1,872) >1 $5,135
CZ12 PGE 4.0 -2,751 213 0.7 ($437) ($7,213) ($5,288) ($5,234) 0.7 ($1,979) >1 $5,002
CZ12 SMUD/PGE 4.0 -2,751 213 0.7 $58 $4,526 ($5,288) ($5,234) >1 $9,761 >1 $5,002
CZ13 PGE 2.1 -2,099 154 0.6 ($383) ($7,136) ($5,136) ($5,116) 0.7 ($2,021) >1 $4,904
CZ14 SCE/SCG 1.6 -2,301 159 0.6 ($411) ($7,590) ($5,136) ($5,116) 0.7 ($2,475) >1 $4,493
CZ14 SDGE 1.6 -2,301 159 0.6 ($914) ($21,350) ($5,149) ($5,130) 0.2 ($16,219) >1 $4,506
CZ15 SCE/SCG 1.6 -944 53 0.2 ($165) ($3,084) ($5,407) ($5,369) 1.7 $2,285 10.3 $4,247
CZ16 PG&E 6.0 -4,314 404 1.5 ($545) ($6,642) ($3,257) ($2,954) 0.4 ($3,687) >1 $3,139
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Table 17. ADU Cost-Effectiveness: All-Electric Code Minimum
Climate
Zone
Electric
/Gas Utility
Efficiency
EDR2
Margin
Annual
Elec
Savings
(kWh)
Annual
Gas
Savings
(therms)
Average
Annual GHG
Reductions
(metric tons)
Utility Cost
Savings Incremental Cost On-Bill TDV
First
Year
Lifecycle
(2022$)
First
Year
Lifecycle
(2022$)
B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 0.0 -1,832 114 0.4 ($346) ($6,791) ($3,260) ($2,957) 0.4 ($3,834) 1.2 $489
CZ02 PGE 0.4 -1,380 75 0.2 ($353) ($7,539) ($3,260) ($2,957) 0.4 ($4,582) 1.2 $403
CZ03 PGE 0.0 -1,665 123 0.5 ($384) ($7,667) ($2,457) ($2,106) 0.3 ($5,560) 2.0 $888
CZ04 PGE 0.2 -1,591 118 0.5 ($351) ($6,970) ($3,260) ($2,957) 0.4 ($4,013) 15.9 $2,395
CZ04 CPAU 0.2 -1,591 118 0.5 $42 $3,285 ($3,260) ($2,957) >1 $6,242 15.9 $2,395
CZ05 PGE 0.4 -1,031 49 0.1 ($268) ($5,966) ($3,260) ($2,957) 0.5 ($3,009) 1.2 $460
CZ05 PGE/SCG 0.4 -1,031 49 0.1 ($226) ($4,656) ($3,260) ($2,957) 0.6 ($1,699) 1.2 $460
CZ06 SCE/SCG 0.2 -909 38 0.1 ($215) ($4,435) ($3,260) ($2,957) 0.7 ($1,478) 1.4 $666
CZ07 SDGE 0.4 -879 37 0.1 ($384) ($9,528) ($3,260) ($2,957) 0.3 ($6,571) 1.4 $771
CZ08 SCE/SCG 0.6 -864 36 0.1 ($212) ($4,397) ($3,216) ($2,908) 0.7 ($1,489) 1.5 $876
CZ09 SCE 0.6 -901 38 0.1 ($190) ($3,861) ($3,216) ($2,908) 0.8 ($953) 1.6 $896
CZ10 SCE/SCG 0.4 -962 43 0.1 ($184) ($3,663) ($3,216) ($2,908) 0.8 ($755) 1.7 $1,055
CZ10 SDGE 0.4 -962 43 0.1 ($404) ($9,951) ($3,216) ($2,908) 0.3 ($7,043) 1.7 $1,055
CZ11 PGE 0.2 -1,322 71 0.2 ($297) ($6,281) ($3,260) ($2,957) 0.5 ($3,324) 1.5 $843
CZ12 PGE 0.3 -1,283 69 0.2 ($298) ($6,354) ($3,260) ($2,957) 0.5 ($3,397) 1.4 $716
CZ12 SMUD/PGE 0.3 -1,283 69 0.2 ($75) ($1,053) ($3,260) ($2,957) 2.8 $1,904 1.4 $716
CZ13 PGE 0.1 -1,594 112 0.4 ($296) ($5,748) ($3,260) ($2,957) 0.5 ($2,791) 11.3 $2,330
CZ14 SCE/SCG 0.4 -1,658 115 0.4 ($282) ($5,107) ($3,216) ($2,908) 0.6 ($2,199) 12.6 $2,313
CZ14 SDGE 0.4 -1,658 115 0.4 ($455) ($10,294) ($3,216) ($2,908) 0.3 ($7,386) 12.6 $2,313
CZ15 SCE/SCG 1.3 -783 36 0.1 ($146) ($2,872) ($3,216) ($2,908) 1.0 $35 2.3 $1,408
CZ16 PG&E 0.1 -1,807 122 0.4 ($348) ($6,698) ($2,640) ($2,261) 0.3 ($4,437) 1.0 $22
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4.3 All-Electric Plus Efficiency, PV, and Battery Results
Table 18 and Table 19 compare cost-effectiveness results for the all-electric packages for the single family and ADU prototypes, respectively. In all cases the
packages are cost effective based on TDV. On-Bill cost effectiveness generally improves with the addition of efficiency measures, improves significantly with an
upsized PV system, and then declines again once batteries are added.
Table 18. Single Family Cost-Effectiveness: All-Electric Energy Efficiency + Additional PV + Battery
Climate
Zone
Electric
/Gas Utility
All Electric Efficiency All Electric Efficiency + NEEA All Electric Efficiency + PV All Electric Efficiency + PV +
Battery
On-Bill TDV On-Bill TDV On-Bill TDV On-Bill TDV
B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 0.7 ($1,256) >1 $8,122 4.0 $2,407 >1 $10,497 2.8 $22,471 1.9 $9,517 1.5 $11,220 1.4 $9,062
CZ02 PGE 0.6 ($1,957) >1 $7,579 1.1 $236 >1 $8,957 3.5 $16,261 2.9 $10,678 1.3 $4,955 1.9 $13,716
CZ03 PGE 0.5 ($3,826) >1 $4,674 0.6 ($1,851) >1 $6,023 3.5 $10,584 2.9 $7,145 0.96 ($685) 1.6 $9,058
CZ04 PGE 0.5 ($3,085) >1 $5,328 0.7 ($1,599) >1 $6,220 3.7 $9,560 3.7 $8,348 0.9 ($1,607) 1.8 $10,519
CZ04 CPAU >1 $12,524 >1 $9,616 >1 $13,328 >1 $10,508 >1 $13,692 >1 $12,636 1.4 $3,815 2.6 $14,807
CZ05 PGE 0.6 ($2,601) 12.6 $3,140 1.1 $363 >1 $5,239 4.9 $11,566 3.3 $6,058 1.0 $583 1.6 $7,976
CZ05 PGE/SCG 0.6 ($2,698) 12.6 $3,140 1.1 $266 >1 $5,239 4.8 $11,469 3.3 $6,058 1.0 $486 1.6 $7,976
CZ06 SCE/SCG 0.9 ($500) 21.3 $2,785 1.2 $554 >1 $3,582 5.3 $6,705 4.9 $5,331 0.96 ($530) 1.6 $7,663
CZ07 SDGE 0.4 ($5,221) 6.1 $2,929 0.5 ($3,795) >1 $3,706 13.2 $11,129 7.2 $4,840 0.97 ($355) 1.5 $6,158
CZ08 SCE/SCG 1.0 $129 8.8 $3,006 1.4 $1,028 >1 $3,618 10.2 $6,404 10.7 $5,797 0.99 ($82) 1.8 $8,401
CZ09 SCE 0.996 ($14) 102.1 $3,357 1.3 $959 >1 $4,073 8.5 $7,052 8.7 $6,238 1.1 $626 1.9 $10,710
CZ10 SCE/SCG 0.9 ($403) >1 $3,475 1.2 $668 >1 $4,260 5.5 $7,389 5.5 $6,432 1.1 $1,597 1.7 $7,804
CZ10 SDGE 0.3 ($9,171) >1 $3,475 0.3 ($7,637) >1 $4,260 8.4 $12,063 5.5 $6,432 1.0 $514 1.7 $7,804
CZ11 PGE 1.1 $356 >1 $6,751 2.9 $1,988 >1 $7,863 3.9 $15,570 3.1 $9,509 1.3 $4,736 1.8 $12,035
CZ12 PGE 0.8 ($923) >1 $5,727 1.4 $840 >1 $6,925 3.8 $14,386 2.9 $8,684 1.2 $3,221 1.8 $11,629
CZ12 SMUD/PGE >1 $8,792 >1 $5,727 >1 $9,445 >1 $6,925 3.2 $11,636 2.9 $8,684 1.1 $1,351 1.8 $11,629
CZ13 PGE 1.0 ($134) >1 $6,391 1.7 $1,204 >1 $7,315 4.5 $12,333 3.9 $8,944 1.1 $1,808 1.9 $12,609
CZ14 SCE/SCG 0.96 ($226) >1 $6,168 2.6 $1,429 >1 $7,337 3.5 $11,205 3.8 $10,769 1.4 $6,530 1.9 $13,315
CZ14 SDGE 0.2 ($12,027) >1 $6,181 0.2 ($8,562) >1 $7,350 4.2 $14,424 3.8 $10,782 1.2 $2,882 1.9 $13,328
CZ15 SCE/SCG 3.2 $2,088 >1 $4,185 10.7 $2,739 >1 $4,639 >1 $5,871 >1 $5,572 1.2 $2,471 1.7 $7,367
CZ16 PG&E 0.3 ($2,843) >1 $3,675 0.5 ($1,291) >1 $4,277 3.1 $22,017 1.9 $8,576 1.5 $10,722 1.6 $11,922
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Table 19. ADU Cost-Effectiveness: All-Electric Energy Efficiency + Additional PV + Battery
Climate
Zone
Electric
/Gas Utility
All Electric Efficiency Only All Electric Efficiency + NEEA All Electric Efficiency + PV All Electric Efficiency + PV + Battery
On-Bill TDV On-Bill TDV On-Bill TDV On-Bill TDV
B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 0.3 ($2,010) >1 $1,155 2.5 $610 >1 $3,162 2.2 $16,861 1.2 $2,976 1.2 $5,286 1.0 $168
CZ02 PGE 0.2 ($4,208) 3.3 $481 0.3 ($2,696) >1 $1,403 2.5 $15,218 1.5 $4,707 1.2 $3,791 1.3 $6,522
CZ03 PGE 0.1 ($6,115) 14.1 $325 0.1 ($4,828) >1 $1,206 2.3 $12,653 1.5 $4,249 1.1 $1,285 1.2 $4,720
CZ04 PGE 0.0 ($5,883) 20.7 $992 0.0 ($4,940) 34.2 $1,672 2.3 $13,081 1.7 $6,179 1.1 $1,797 1.4 $6,977
CZ04 CPAU >1 $3,951 20.7 $992 >1 $4,509 34.2 $1,672 1.7 $6,738 1.7 $6,179 0.8 ($4,973) 1.4 $6,977
CZ05 PGE 0.3 ($4,141) 0.6 ($698) 0.3 ($2,912) 1.3 $222 2.9 $15,238 1.5 $3,921 1.2 $3,903 1.2 $3,473
CZ05 PGE/SCG 0.3 ($2,831) 0.6 ($698) 0.5 ($1,602) 1.3 $222 3.1 $16,548 1.5 $3,921 1.3 $5,212 1.2 $3,473
CZ06 SCE/SCG 0.4 ($2,272) 0.996 ($5) 0.5 ($1,672) 1.7 $444 2.6 $11,941 1.8 $5,275 1.1 $2,134 1.3 $5,984
CZ07 SDGE 0.2 ($6,766) 1.0 $4 0.2 ($5,978) 1.7 $435 3.8 $22,595 1.6 $4,364 1.6 $11,005 1.2 $3,943
CZ08 SCE/SCG 0.4 ($2,380) 0.98 ($23) 0.4 ($1,832) 1.4 $334 2.5 $12,446 1.9 $6,579 1.2 $2,991 1.4 $7,829
CZ09 SCE 0.4 ($1,858) 1.1 $53 0.5 ($1,255) 1.5 $367 2.6 $12,699 1.9 $6,334 1.2 $3,232 1.5 $9,406
CZ10 SCE/SCG 0.5 ($1,556) 1.4 $280 0.6 ($800) 4.9 $828 2.7 $3,430 2.1 $2,156 0.6 ($5,734) 1.2 $2,118
CZ10 SDGE 0.2 ($7,442) 1.4 $280 0.2 ($6,395) 4.9 $828 3.1 $4,264 2.1 $2,156 0.5 ($7,385) 1.2 $2,118
CZ11 PGE 0.3 ($2,749) >1 $1,115 0.4 ($1,634) >1 $1,901 2.1 $3,811 1.8 $2,577 0.5 ($7,415) 1.3 $4,046
CZ12 PGE 0.2 ($3,692) 3.1 $430 0.3 ($2,597) >1 $1,320 2.6 $16,095 1.6 $5,047 1.2 $4,800 1.3 $6,745
CZ12 SMUD/PGE 3.1 $645 3.1 $430 >1 $1,076 >1 $1,320 1.4 $4,399 1.6 $5,047 0.7 ($6,294) 1.3 $6,745
CZ13 PGE 0.0 ($3,425) 17.9 $1,657 0.0 ($2,455) 25.7 $2,419 1.7 $2,505 1.9 $3,158 0.4 ($8,653) 1.4 $5,829
CZ14 SCE/SCG 0.0 ($3,402) 4.0 $1,280 0.0 ($2,270) 6.0 $2,097 2.4 $13,741 2.0 $8,807 1.2 $5,041 1.5 $10,045
CZ14 SDGE 0.0 ($7,519) 4.0 $1,280 0.0 ($5,884) 6.0 $2,097 3.8 $28,555 2.0 $8,807 1.8 $16,912 1.5 $10,045
CZ15 SCE/SCG 1.0 ($47) >1 $1,212 1.3 $204 >1 $1,264 3.5 $3,155 2.9 $2,387 0.6 ($5,030) 1.3 $3,480
CZ16 PG&E 0.3 ($3,414) 9.9 $748 0.3 ($2,658) >1 $1,580 2.8 $19,246 1.7 $6,200 1.4 $7,856 1.4 $7,321
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4.4 Mixed Fuel Results
Table 20 and Table 21 show results for the Mixed Fuel Efficiency + PV + Battery package compared to the 2022 baseline for Single Family and ADU,
respectively. This package is cost-effective based on TDV everywhere for the single family prototype. It’s TDV cost-effective in most cases for the ADU with the
exception of Climate Zones 1 and 10. The package is cost-effective On-Bill for the single family home only in Climate Zone 1. For the ADU the package is cost-
effective On-Bill in Climate Zones 1, 2, 5, 7, 9, 12 in PG&E territory, 14, and 16. For the climate zones where there is no PV requirement in the base package, the
addition of a new PV system substantially reduced utility costs and the high cost-effectiveness of the PV measure helped to offset the high cost of the battery
system.
Table 20. Single Family Cost-Effectiveness: Mixed Fuel Efficiency + PV + Battery
Climate
Zone
Electric
/Gas Utility
Efficiency
EDR2
Margin
Annual
Elec
Savings
(kWh)
Annual
Gas
Savings
(therms)
Average
Annual GHG
Reductions
(metric tons)
Utility Cost
Savings Incremental Cost On-Bill TDV
First
Year
Lifecycle
(2022$)
First
Year
Lifecycle
(2022$)
B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 30.0 1,577 118 1.1 $710 $18,829 $9,845 $17,192 1.1 $1,636 1.4 $5,664
CZ02 PGE 13.5 1,264 35 0.7 $419 $10,499 $8,951 $15,899 0.7 ($5,400) 1.4 $6,396
CZ03 PGE 11.2 1,073 7 0.6 $295 $7,072 $7,718 $14,333 0.5 ($7,261) 1.2 $2,956
CZ04 PGE 8.4 912 6 0.5 $244 $5,862 $8,056 $14,763 0.4 ($8,902) 1.2 $3,219
CZ04 CPAU 8.4 912 6 0.5 $159 $3,839 $8,056 $14,763 0.3 ($10,925) 1.2 $3,219
CZ05 PGE 16.8 1,186 43 0.8 $416 $10,571 $8,517 $15,361 0.7 ($4,790) 1.3 $4,171
CZ05 PGE/SCG 16.8 1,186 43 0.8 $394 $9,850 $8,517 $15,361 0.6 ($5,512) 1.3 $4,171
CZ06 SCE/SCG 9.2 894 6 0.5 $370 $8,721 $8,097 $14,780 0.6 ($6,059) 1.2 $3,134
CZ07 SDGE 8.3 841 4 0.5 $358 $9,129 $8,029 $14,709 0.6 ($5,579) 1.1 $1,612
CZ08 SCE/SCG 9.5 783 2 0.5 $381 $8,924 $7,494 $14,074 0.6 ($5,150) 1.3 $3,991
CZ09 SCE 8.6 839 3 0.5 $390 $9,148 $7,509 $14,094 0.6 ($4,946) 1.5 $5,914
CZ10 SCE/SCG 8.3 854 2 0.5 $416 $9,733 $7,139 $13,724 0.7 ($3,990) 1.2 $2,863
CZ10 SDGE 8.3 854 2 0.5 $314 $7,983 $7,139 $13,724 0.6 ($5,741) 1.2 $2,863
CZ11 PGE 11.0 1,034 27 0.7 $398 $9,903 $8,478 $15,286 0.6 ($5,383) 1.4 $5,505
CZ12 PGE 11.0 1,107 23 0.6 $364 $9,006 $8,733 $15,626 0.6 ($6,620) 1.4 $5,074
CZ12 SMUD/PGE 11.0 1,107 23 0.6 $252 $6,354 $8,733 $15,626 0.4 ($9,272) 1.4 $5,074
CZ13 PGE 9.6 1,168 5 0.6 $407 $9,736 $8,713 $15,536 0.6 ($5,801) 1.4 $5,562
CZ14 SCE/SCG 11.2 1,737 6 0.7 $663 $15,570 $9,664 $16,695 0.9 ($1,125) 1.4 $5,435
CZ14 SDGE 11.2 1,737 6 0.7 $403 $10,291 $9,664 $16,695 0.6 ($6,404) 1.4 $5,435
CZ15 SCE/SCG 8.5 532 2 0.5 $486 $11,372 $7,170 $13,536 0.8 ($2,164) 1.3 $3,451
CZ16 PG&E 22.6 1,235 115 1.2 $571 $15,439 $10,780 $18,007 0.9 ($2,568) 1.5 $8,024
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Table 21. ADU Cost-Effectiveness: Mixed Fuel Efficiency + PV + Battery
Climate
Zone
Electric
/Gas Utility
Efficiency
EDR2
Margin
Annual
Elec
Savings
(kWh)
Annual
Gas
Savings
(therms)
Average
Annual GHG
Reductions
(metric tons)
Utility Cost
Savings Incremental Cost On-Bill TDV
First
Year
Lifecycle
(2022$)
First
Year
Lifecycle
(2022$)
B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 24.3 3,642 79 0.8 $1,211 $29,946 $15,209 $25,617 1.2 $4,329 0.9 ($1,365)
CZ02 PGE 14.5 3,451 40 0.6 $1,028 $25,019 $12,944 $22,587 1.1 $2,431 1.2 $4,938
CZ03 PGE 12.1 2,750 2 0.4 $715 $16,948 $11,077 $19,325 0.9 ($2,377) 1.1 $1,349
CZ04 PGE 12.2 2,860 2 0.4 $759 $17,992 $11,523 $19,837 0.9 ($1,845) 1.1 $2,417
CZ04 CPAU 12.2 2,860 2 0.4 $316 $7,490 $11,523 $19,837 0.4 ($12,347) 1.1 $2,417
CZ05 PGE 7.8 3,293 14 0.5 $959 $22,944 $11,409 $20,621 1.1 $2,324 1.1 $1,409
CZ05 PGE/SCG 7.8 3,293 14 0.5 $952 $22,711 $11,409 $20,621 1.1 $2,090 1.1 $1,409
CZ06 SCE/SCG 9.8 3,292 3 0.5 $815 $19,093 $11,028 $20,110 0.9 ($1,017) 1.2 $3,650
CZ07 SDGE 9.1 3,306 1 0.5 $1,172 $29,683 $11,381 $20,583 1.4 $9,100 1.1 $1,603
CZ08 SCE/SCG 10.1 3,527 1 0.5 $887 $20,746 $11,594 $20,867 0.99 ($121) 1.3 $4,990
CZ09 SCE 8.9 3,512 3 0.5 $883 $20,676 $11,361 $20,556 1.0 $120 1.4 $6,682
CZ10 SCE/SCG 9.0 729 7 0.4 $244 $5,806 $7,005 $14,720 0.4 ($8,914) 0.96 ($473)
CZ10 SDGE 9.0 729 7 0.4 $206 $5,312 $7,005 $14,720 0.4 ($9,408) 0.96 ($473)
CZ11 PGE 13.1 870 36 0.5 $277 $7,182 $8,022 $15,995 0.4 ($8,813) 1.1 $2,192
CZ12 PGE 12.6 3,589 33 0.6 $1,063 $25,738 $12,806 $22,393 1.1 $3,345 1.2 $4,771
CZ12 SMUD/PGE 12.6 3,589 33 0.6 $591 $14,577 $12,806 $22,393 0.7 ($7,816) 1.2 $4,771
CZ13 PGE 12.8 359 1 0.4 $77 $1,846 $7,009 $13,789 0.1 ($11,943) 1.2 $2,069
CZ14 SCE/SCG 14.2 3,624 2 0.5 $909 $21,262 $12,054 $20,466 1.0 $795 1.2 $4,545
CZ14 SDGE 14.2 3,624 2 0.5 $1,292 $32,729 $12,054 $20,466 1.6 $12,263 1.2 $4,545
CZ15 SCE/SCG 11.2 546 0 0.4 $252 $5,891 $6,588 $14,077 0.4 ($8,186) 1.1 $964
CZ16 PG&E 16.2 3,652 87 0.8 $1,178 $29,323 $13,234 $23,007 1.3 $6,316 1.2 $4,937
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Table 22 and Table 23 compare cost-effectiveness results across all the mixed fuel packages for the single family and ADU prototypes, respectively. The single
family Efficiency Only package and Efficiency + PV package are cost effective based on On-Bill and TDV under most scenarios. The trends are similar for the
ADU except the Efficiency Only package is not cost effective in many climate zones.
Table 22. Single Family Cost-Effectiveness: Mixed Fuel Packages
Climate
Zone
Electric
/Gas Utility
Mixed Fuel Efficiency Only Mixed Fuel Efficiency + PV Mixed Fuel Efficiency + PV + Battery
On-Bill TDV On-Bill TDV On-Bill TDV
B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 2.8 $3,619 2.7 $3,160 2.4 $8,979 1.6 $3,526 1.1 $1,636 1.4 $5,664
CZ02 PGE 2.0 $1,940 2.5 $2,664 2.2 $5,608 1.8 $3,565 0.7 ($5,400) 1.4 $6,396
CZ03 PGE 1.1 $226 0.97 ($56) 1.6 $2,688 1.2 $602 0.5 ($7,261) 1.2 $2,956
CZ04 PGE 0.8 ($379) 1.1 $107 1.4 $1,493 1.2 $862 0.4 ($8,902) 1.2 $3,219
CZ04 CPAU 0.5 ($1,159) 1.1 $107 0.8 ($910) 1.2 $862 0.3 ($10,925) 1.2 $3,219
CZ05 PGE 1.4 $516 1.3 $300 2.1 $4,449 1.4 $1,359 0.7 ($4,790) 1.3 $4,171
CZ05 PGE/SCG 1.2 $303 1.3 $300 2.1 $4,235 1.4 $1,359 0.6 ($5,512) 1.3 $4,171
CZ06 SCE/SCG 0.6 ($696) 0.9 ($180) 1.5 $1,950 1.2 $757 0.6 ($6,059) 1.2 $3,134
CZ07 SDGE 1.3 $395 0.97 ($36) 2.9 $5,981 1.3 $697 0.6 ($5,579) 1.1 $1,612
CZ08 SCE/SCG 0.8 ($238) 1.1 $103 1.7 $2,013 1.4 $1,099 0.6 ($5,150) 1.3 $3,991
CZ09 SCE 0.9 ($148) 1.2 $250 1.8 $2,266 1.5 $1,229 0.6 ($4,946) 1.5 $5,914
CZ10 SCE/SCG 1.0 $5 1.2 $263 1.7 $2,323 1.4 $1,140 0.7 ($3,990) 1.2 $2,863
CZ10 SDGE 1.6 $960 1.2 $263 2.6 $5,010 1.4 $1,140 0.6 ($5,741) 1.2 $2,863
CZ11 PGE 2.0 $2,242 2.1 $2,187 2.2 $5,142 1.8 $2,824 0.6 ($5,383) 1.4 $5,505
CZ12 PGE 1.4 $949 1.6 $1,207 1.9 $4,150 1.5 $2,039 0.6 ($6,620) 1.4 $5,074
CZ12 SMUD/PGE 1.1 $131 1.6 $1,207 1.2 $933 1.5 $2,039 0.4 ($9,272) 1.4 $5,074
CZ13 PGE 1.5 $1,236 1.5 $1,160 2.0 $4,442 1.5 $1,821 0.6 ($5,801) 1.4 $5,562
CZ14 SCE/SCG 1.3 $981 1.5 $1,290 1.9 $4,917 1.6 $2,877 0.9 ($1,125) 1.4 $5,435
CZ14 SDGE 2.3 $4,109 1.5 $1,290 1.9 $4,753 1.6 $2,877 0.6 ($6,404) 1.4 $5,435
CZ15 SCE/SCG 1.7 $1,534 1.7 $1,444 1.7 $1,653 1.7 $1,465 0.8 ($2,164) 1.3 $3,451
CZ16 PG&E 1.8 $3,124 2.2 $4,123 2.2 $8,324 1.9 $5,419 0.9 ($2,568) 1.5 $8,024
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Table 23. ADU Cost-Effectiveness: Mixed Fuel Packages
Climate
Zone
Electric
/Gas Utility
Mixed Fuel Efficiency Mixed Fuel Efficiency + PV Mixed Fuel Efficiency + PV + Battery
On-Bill TDV On-Bill TDV On-Bill TDV
B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 1.6 $1,228 1.3 $616 2.1 $15,985 1.2 $2,051 1.2 $4,329 0.9 ($1,365)
CZ02 PGE 0.7 ($634) 1.1 $148 2.3 $13,934 1.4 $3,499 1.1 $2,431 1.2 $4,938
CZ03 PGE 0.6 ($666) 0.7 ($475) 2.2 $9,045 1.3 $1,856 0.9 ($2,377) 1.1 $1,349
CZ04 PGE 0.5 ($941) 0.7 ($515) 2.1 $9,487 1.4 $2,679 0.9 ($1,845) 1.1 $2,417
CZ04 CPAU 0.3 ($1,507) 0.7 ($515) 0.99 ($115) 1.4 $2,679 0.4 ($12,347) 1.1 $2,417
CZ05 PGE 0.7 ($456) 0.2 ($1,141) 2.5 $13,761 1.3 $2,473 1.1 $2,324 1.1 $1,409
CZ05 PGE/SCG 0.5 ($689) 0.2 ($1,141) 2.5 $13,528 1.3 $2,473 1.1 $2,090 1.1 $1,409
CZ06 SCE/SCG 0.3 ($976) 0.6 ($638) 2.1 $9,282 1.5 $3,477 0.9 ($1,017) 1.2 $3,650
CZ07 SDGE 0.4 ($830) 0.5 ($717) 3.3 $20,716 1.3 $2,676 1.4 $9,100 1.1 $1,603
CZ08 SCE/SCG 0.3 ($1,069) 0.4 ($819) 2.1 $10,035 1.5 $4,415 0.99 ($121) 1.3 $4,990
CZ09 SCE 0.3 ($1,024) 0.5 ($780) 2.1 $10,242 1.5 $4,195 1.0 $120 1.4 $6,682
CZ10 SCE/SCG 0.4 ($1,004) 0.5 ($750) 1.4 $1,118 1.0 $71 0.4 ($8,914) 0.96 ($473)
CZ10 SDGE 1.5 $721 0.5 ($750) 1.7 $2,230 1.0 $71 0.4 ($9,408) 0.96 ($473)
CZ11 PGE 1.0 ($11) 1.2 $316 1.6 $2,473 1.3 $1,064 0.4 ($8,813) 1.1 $2,192
CZ12 PGE 0.6 ($761) 0.9 ($224) 2.4 $14,704 1.4 $3,458 1.1 $3,345 1.2 $4,771
CZ12 SMUD/PGE 1.0 ($70) 0.9 ($224) 1.3 $2,975 1.4 $3,458 0.7 ($7,816) 1.2 $4,771
CZ13 PGE 0.6 ($850) 1.1 $206 0.6 ($807) 1.1 $240 0.1 ($11,943) 1.2 $2,069
CZ14 SCE/SCG 1.0 $20 1.0 $107 2.2 $10,862 1.6 $4,977 1.0 $795 1.2 $4,545
CZ14 SDGE 1.5 $1,310 1.0 $107 3.7 $23,840 1.6 $4,977 1.6 $12,263 1.2 $4,545
CZ15 SCE/SCG 1.2 $411 1.1 $205 1.4 $916 1.2 $388 0.4 ($8,186) 1.1 $964
CZ16 PG&E 0.7 ($456) 1.0 $52 2.6 $17,779 1.4 $4,505 1.3 $6,316 1.2 $4,937
4.5 CARE Rate Comparison
Table 24 and Table 25 present a comparison of On-Bill cost-effectiveness results for CARE tariffs relative to standard tariffs. The all-electric code minimum
package for the single family and ADU prototypes is shown in Table 24. Applying the CARE rates lowers both electric and gas utility bills for the consumer and
the net impact is lower overall bills for an all-electric home and improved cost-effectiveness relative to the standard tariffs. The opposite trend occurs for the mixed
fuel packages shown in Table 25 where the CARE rate lowers utility cost savings and the benefit-to-cost ratios decline.
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Table 24. On-Bill Cost-Effectiveness with CARE Tariffs: All-Electric Code Minimum
Climate
Zone
Electric
/Gas Utility
Single Family ADU
Standard CARE Standard CARE
B/C Ratio NPV B/C Ratio NPV B/C Ratio NPV B/C Ratio NPV
CZ01 PGE 0.5 ($5,614) 0.8 ($997) 0.4 ($3,834) 0.7 ($1,505)
CZ02 PGE 0.5 ($4,826) 0.8 ($1,281) 0.4 ($4,582) 0.6 ($2,146)
CZ03 PGE 0.5 ($4,838) 0.8 ($924) 0.3 ($5,560) 0.4 ($2,733)
CZ04 PGE 0.6 ($3,641) 0.96 ($215) 0.4 ($4,013) 0.7 ($1,465)
CZ04 CPAU >1 $13,205 >1 $9,931 >1 $6,242 >1 $2,957
CZ05 PGE 0.6 ($3,696) 0.9 ($647) 0.5 ($3,009) 0.7 ($1,158)
CZ05 PGE/SCG 0.6 ($3,793) 1.1 $444 0.6 ($1,699) 1.1 $243
CZ06 SCE/SCG 1.0 $115 1.6 $1,984 0.7 ($1,478) 0.97 ($98)
CZ07 SDGE 0.5 ($5,670) 0.8 ($1,636) 0.3 ($6,571) 0.5 ($3,441)
CZ08 SCE/SCG 1.1 $371 1.7 $2,073 0.7 ($1,489) 0.95 ($139)
CZ09 SCE 1.0 $126 1.6 $2,001 0.8 ($953) 1.1 $261
CZ10 SCE/SCG 0.9 ($486) 1.5 $1,703 0.8 ($755) 1.2 $433
CZ10 SDGE 0.3 ($10,239) 0.5 ($4,330) 0.3 ($7,043) 0.4 ($3,645)
CZ11 PGE 0.7 ($1,872) 1.1 $568 0.5 ($3,324) 0.7 ($1,344)
CZ12 PGE 0.7 ($1,979) 1.1 $457 0.5 ($3,397) 0.7 ($1,395)
CZ12 SMUD/PGE >1 $9,761 >1 $12,640 2.8 $1,904 >1 $4,281
CZ13 PGE 0.7 ($2,021) 1.2 $783 0.5 ($2,791) 0.7 ($991)
CZ14 SCE/SCG 0.7 ($2,475) 1.1 $505 0.6 ($2,199) 0.9 ($222)
CZ14 SDGE 0.2 ($16,219) 0.4 ($7,861) 0.3 ($7,386) 0.5 ($3,249)
CZ15 SCE/SCG 1.7 $2,285 2.6 $3,330 1.0 $35 1.5 $927
CZ16 PG&E 0.4 ($3,687) 0.8 ($825) 0.3 ($4,437) 0.5 ($2,157)
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Table 25. On-Bill Cost-Effectiveness with CARE Tariffs: Mixed Fuel Efficiency+ PV+ Battery Package
Climate
Zone
Electric
/Gas Utility
Single Family ADU
Standard CARE Standard CARE
B/C Ratio NPV B/C Ratio NPV B/C Ratio NPV B/C Ratio NPV
CZ01 PGE 1.1 $1,636 0.7 ($4,574) 1.2 $4,329 0.7 ($6,549)
CZ02 PGE 0.7 ($5,400) 0.4 ($8,958) 1.1 $2,431 0.7 ($6,728)
CZ03 PGE 0.5 ($7,261) 0.3 ($9,524) 0.9 ($2,377) 0.6 ($8,471)
CZ04 PGE 0.4 ($8,902) 0.3 ($10,706) 0.9 ($1,845) 0.6 ($8,329)
CZ04 CPAU 0.3 ($10,925) 0.0 ($14,763) 0.4 ($12,347) 0.0 ($19,837)
CZ05 PGE 0.7 ($4,790) 0.5 ($8,377) 1.1 $2,324 0.7 ($6,030)
CZ05 PGE/SCG 0.6 ($5,512) 0.4 ($8,540) 1.1 $2,090 0.7 ($6,067)
CZ06 SCE/SCG 0.6 ($6,059) 0.3 ($9,638) 0.9 ($1,017) 0.6 ($8,203)
CZ07 SDGE 0.6 ($5,579) 0.5 ($7,676) 1.4 $9,100 0.96 ($836)
CZ08 SCE/SCG 0.6 ($5,150) 0.4 ($8,775) 0.99 ($121) 0.6 ($7,852)
CZ09 SCE 0.6 ($4,946) 0.4 ($8,642) 1.0 $120 0.6 ($7,580)
CZ10 SCE/SCG 0.7 ($3,990) 0.4 ($7,862) 0.4 ($8,914) 0.2 ($11,587)
CZ10 SDGE 0.6 ($5,741) 0.5 ($7,396) 0.4 ($9,408) 0.3 ($10,388)
CZ11 PGE 0.6 ($5,383) 0.4 ($8,671) 0.4 ($8,813) 0.3 ($11,145)
CZ12 PGE 0.6 ($6,620) 0.4 ($9,617) 1.1 $3,345 0.7 ($6,094)
CZ12 SMUD/PGE 0.4 ($9,272) 0.1 ($14,636) 0.7 ($7,816) 0.1 ($20,989)
CZ13 PGE 0.6 ($5,801) 0.4 ($9,016) 0.1 ($11,943) 0.1 ($12,502)
CZ14 SCE/SCG 0.9 ($1,125) 0.6 ($6,889) 1.0 $795 0.7 ($7,099)
CZ14 SDGE 0.6 ($6,404) 0.5 ($8,940) 1.6 $12,263 1.1 $1,271
CZ15 SCE/SCG 0.8 ($2,164) 0.5 ($6,384) 0.4 ($8,186) 0.2 ($10,846)
CZ16 PG&E 0.9 ($2,568) 0.6 ($7,747) 1.3 $6,316 0.8 ($4,356)
4.6 Utility Infrastructure Cost Sensitivity
Table 26 compares cost effectiveness results for the three natural gas service line extension cost scenarios presented in Table 8. The average cost scenario
reflects the costs applied in the results presented in the prior sections (Table 16). The gas infrastructure cost savings are lower for the new subdivision case and
higher for the infill development case. For the latter, the all-electric home is On-Bill cost-effective in all climate zones except Climate Zones 1, 2, 10 in SDG&E
territory, and 14 in SDG&E territory. Table 27 presents the impact on On-Bill cost-effectiveness if the subsidies currently allowed under the utility gas main
extension rules were removed per a recent CPUC Proposed Decision (see discussion in Section 3.3.2). If the subsidies were removed On-Bill cost-effectiveness
improves but only enough to change the outcome in one case, Climate Zones 10 in SoCalGas territory.
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Table 26. Single Family Cost-Effectiveness Comparison with Range of Natural Gas Utility Infrastructure Costs:
All-Electric Code Minimum
Climate
Zone
Electric
/Gas Utility
Average New Subdivision Infill Development
On-Bill TDV On-Bill TDV On-Bill TDV
B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 0.5 ($5,614) >1 $5,566 0.4 ($6,838) >1 $4,476 0.9 ($718) >1 $9,926
CZ02 PGE 0.5 ($4,826) >1 $5,390 0.4 ($6,050) >1 $4,300 1.0 $70 >1 $9,750
CZ03 PGE 0.5 ($4,838) 63.5 $4,414 0.4 ($6,062) 48.1 $3,324 1.0 $57 125.3 $8,774
CZ04 PGE 0.6 ($3,641) >1 $4,929 0.4 ($4,865) >1 $3,839 1.1 $1,255 >1 $9,289
CZ04 CPAU >1 $13,205 >1 $9,217 >1 $13,205 >1 $9,217 >1 $13,205 >1 $9,217
CZ05 PGE 0.6 ($3,696) 2.5 $2,776 0.4 ($4,920) 1.9 $1,686 1.1 $1,200 4.9 $7,136
CZ05 PGE/SCG 0.6 ($3,793) 2.5 $2,776 0.4 ($5,017) 1.9 $1,686 1.1 $1,103 4.9 $7,136
CZ06 SCE/SCG 1.0 $115 3.2 $3,142 0.8 ($1,109) 2.4 $2,052 2.0 $5,011 6.2 $7,502
CZ07 SDGE 0.5 ($5,670) 3.1 $3,081 0.4 ($6,894) 2.3 $1,991 0.9 ($774) 6.0 $7,441
CZ08 SCE/SCG 1.1 $371 2.8 $2,951 0.8 ($853) 2.1 $1,861 2.1 $5,266 5.5 $7,311
CZ09 SCE 1.0 $126 3.3 $3,179 0.8 ($1,098) 2.5 $2,089 2.0 $5,022 6.4 $7,539
CZ10 SCE/SCG 0.9 ($486) 3.5 $3,285 0.7 ($1,710) 2.7 $2,195 1.8 $4,410 6.9 $7,645
CZ10 SDGE 0.3 ($10,239) 3.5 $3,285 0.3 ($11,463) 2.7 $2,195 0.7 ($5,344) 6.9 $7,645
CZ11 PGE 0.7 ($1,872) >1 $5,135 0.6 ($3,096) >1 $4,045 1.4 $3,024 >1 $9,495
CZ12 PGE 0.7 ($1,979) >1 $5,002 0.6 ($3,203) >1 $3,912 1.4 $2,917 >1 $9,362
CZ12 SMUD/PGE >1 $9,761 >1 $5,002 >1 $8,537 >1 $3,912 >1 $14,656 >1 $9,362
CZ13 PGE 0.7 ($2,021) >1 $4,904 0.5 ($3,245) >1 $3,814 1.4 $2,875 >1 $9,264
CZ14 SCE/SCG 0.7 ($2,475) >1 $4,493 0.5 ($3,699) >1 $3,403 1.3 $2,421 >1 $8,853
CZ14 SDGE 0.2 ($16,219) >1 $4,506 0.2 ($17,443) >1 $3,416 0.5 ($11,323) >1 $8,866
CZ15 SCE/SCG 1.7 $2,285 10.3 $4,247 1.3 $1,061 7.9 $3,157 3.3 $7,181 19.8 $8,607
CZ16 PG&E 0.4 ($3,687) >1 $3,139 0.3 ($4,911) >1 $2,049 1.2 $1,208 >1 $7,499
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Table 27. Single Family Cost-Effectiveness On-Bill Impact of CPUC Proposed Decision on Gas Line Extension Allowances:
All-Electric Code Minimum
Climate
Zone
Electric
/Gas Utility
No Allowances
With Allowance No Allowances
B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 0.5 ($5,614) 0.6 ($4,469)
CZ02 PGE 0.5 ($4,826) 0.6 ($3,681)
CZ03 PGE 0.5 ($4,838) 0.6 ($3,693)
CZ04 PGE 0.6 ($3,641) 0.7 ($2,495)
CZ04 CPAU >1 $13,205 >1 $13,205
CZ05 PGE 0.6 ($3,696) 0.7 ($2,551)
CZ05 PGE/SCG 0.6 ($3,793) 0.7 ($2,647)
CZ06 SCE/SCG 1.0 $115 1.2 $1,260
CZ07 SDGE 0.5 ($5,670) 0.6 ($4,524)
CZ08 SCE/SCG 1.1 $371 1.3 $1,516
CZ09 SCE 1.0 $126 1.2 $1,271
CZ10 SCE/SCG 0.9 ($486) 1.1 $660
CZ10 SDGE 0.3 ($10,239) 0.4 ($9,094)
CZ11 PGE 0.7 ($1,872) 0.9 ($726)
CZ12 PGE 0.7 ($1,979) 0.9 ($834)
CZ12 SMUD/PGE >1 $9,761 >1 $10,906
CZ13 PGE 0.7 ($2,021) 0.9 ($875)
CZ14 SCE/SCG 0.7 ($2,475) 0.8 ($1,329)
CZ14 SDGE 0.2 ($16,219) 0.3 ($15,088)
CZ15 SCE/SCG 1.7 $2,285 2.1 $3,430
CZ16 PG&E 0.4 ($3,687) 0.6 ($2,542)
4.7 Greenhouse Gas Reductions
Table 28 and Table 29 present greenhouse gas reductions for the single family and ADU prototypes, respectively. Savings represent average annual savings
over the 30-year lifetime of the analysis. Greenhouse gas reductions are greatest for the all-electric Efficiency + PV + Battery package in all cases. For the single
family homes, the all-electric code minimum case reduces greenhouse gas emissions as much or greater than the mixed fuel Efficiency + PV + Battery package
in Climate Zones 1 through 4, 11, 12, 13, and 16. The trend differs for the ADU where the mixed fuel Efficiency + PV + Battery package results in more
greenhouse gas savings than the all-electric code minimum in all climate zones except Climate Zones 3, 4, and 13.
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Table 28: Single Family Greenhouse Gas Reductions (metric tons)
Climate
Zone
Single Family All-Electric Single Family Mixed Fuel
Code
Minimum
Efficiency
Only
Efficiency
+ NEEA
Efficiency
+ PV
Efficiency
+ PV +
Battery
Efficiency
Only
Efficiency
+ PV
Efficiency
+ PV +
Battery
CZ01 1.5 1.6 1.7 1.8 2.2 0.4 0.5 1.1
CZ02 0.8 0.9 1.0 1.1 1.5 0.3 0.3 0.7
CZ03 0.7 0.8 0.8 0.9 1.3 0.1 0.1 0.6
CZ04 0.7 0.7 0.8 0.8 1.3 0.1 0.1 0.5
CZ05 0.4 0.4 0.5 0.6 1.1 0.1 0.1 0.8
CZ06 0.3 0.3 0.3 0.4 0.9 0.1 0.1 0.5
CZ07 0.2 0.2 0.3 0.3 0.8 0.0 0.1 0.5
CZ08 0.2 0.2 0.3 0.3 0.8 0.0 0.1 0.5
CZ09 0.3 0.3 0.3 0.4 0.9 0.0 0.1 0.5
CZ10 0.3 0.3 0.4 0.4 0.9 0.1 0.1 0.5
CZ11 0.7 0.9 0.9 1.0 1.4 0.2 0.2 0.7
CZ12 0.7 0.8 0.8 0.9 1.3 0.2 0.2 0.6
CZ13 0.6 0.7 0.7 0.8 1.3 0.1 0.1 0.6
CZ14 0.6 0.7 0.8 0.9 1.4 0.2 0.2 0.7
CZ15 0.2 0.2 0.2 0.3 0.7 0.1 0.1 0.5
CZ16 1.5 1.6 1.6 1.8 2.3 0.7 0.8 1.2
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Table 29 ADU Greenhouse Gas Savings (metric tons)
Climate
Zone
ADU All-Electric ADU Mixed Fuel
Code
Minimum
Efficiency
Only
Efficiency
+ NEEA
Efficiency
+ PV
Efficiency
+ PV +
Battery
Efficiency
Only
Efficiency
+ PV
Efficiency
+ PV +
Battery
CZ01 0.4 0.5 0.5 0.6 0.9 0.4 0.5 0.8
CZ02 0.2 0.3 0.3 0.4 0.8 0.2 0.3 0.6
CZ03 0.5 0.5 0.6 0.7 1.0 0.1 0.1 0.4
CZ04 0.5 0.5 0.5 0.7 1.0 0.0 0.1 0.4
CZ05 0.1 0.2 0.2 0.3 0.7 0.0 0.2 0.5
CZ06 0.1 0.1 0.1 0.3 0.6 0.0 0.2 0.5
CZ07 0.1 0.1 0.1 0.3 0.6 0.0 0.2 0.5
CZ08 0.1 0.1 0.1 0.3 0.7 0.0 0.2 0.5
CZ09 0.1 0.1 0.1 0.3 0.7 0.0 0.2 0.5
CZ10 0.1 0.1 0.2 0.2 0.6 0.0 0.1 0.4
CZ11 0.2 0.3 0.3 0.3 0.7 0.2 0.2 0.5
CZ12 0.2 0.2 0.3 0.4 0.7 0.1 0.3 0.6
CZ13 0.4 0.5 0.5 0.6 0.9 0.1 0.1 0.4
CZ14 0.4 0.5 0.5 0.7 1.1 0.1 0.2 0.5
CZ15 0.1 0.1 0.2 0.2 0.6 0.0 0.0 0.4
CZ16 0.4 0.5 0.5 0.7 1.0 0.4 0.5 0.8
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Cost-Effectiveness Analysis: Single Family New Construction 41 Summary
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
5 Summary
The Reach Codes Team identified packages of energy efficiency measures as well as packages combining energy
efficiency with solar PV generation and battery storage, simulated them in building modeling software, and gathered
costs to determine the cost-effectiveness of multiple scenarios. The Reach Codes Team coordinated with multiple
utilities, cities, and building community experts to develop a set of assumptions considered reasonable in the current
market. Changing assumptions, such as the period of analysis, measure selection, cost assumptions, energy
escalation rates, or utility tariffs are likely to change results.
Table 30 (all-electric) and Table 31 (mixed fuel) summarize results for each prototype and depicts the efficiency EDR2
compliance margins achieved for each climate zone and package. Because local reach codes must both exceed the
Energy Commission performance budget (i.e., have a positive compliance margin) and be cost-effective, the Reach
Codes Team highlighted cells meeting these two requirements to help clarify the upper boundary for potential reach
code policies. All results presented in this study have a positive compliance margin.
• Cells highlighted in green depict a positive compliance margin and cost-effective results using both On-Bill and
TDV approaches.
• Cells highlighted in yellow depict a positive compliance and cost-effective results using either the On-Bill or
TDV approach.
• Cells not highlighted depict a package that was not cost effective using either the On-Bill or TDV approach.
Following are key takeaways and recommendations from the analysis.
• All-electric packages have lower GHG emissions than mixed-fuel packages in all cases, due to the clean
power sources currently available from California’s power providers.
• The Reach Codes Team found all-electric new construction to be feasible and cost effective based on TDV in
all cases. In many cases all-electric code minimum construction results in an increase in utility costs and is not
cost-effective On-Bill. Some exceptions include the SMUD and CPAU territories where lower electricity rates
relative to gas rates result in lower overall utility bills.
• The 2022 Title 24 Code’s new source energy metric combined with the heat pump baseline encourage all-
electric construction, providing an incentive that allows for some amount of prescriptively required building
efficiency to be traded off. This compliance benefit for all-electric homes highlights a unique opportunity for
jurisdictions to incorporate efficiency into all-electric reach codes. Efficiency and electrification have symbiotic
benefits and are both critical for decarbonization of buildings. As demand on the electric grid is increased
through electrification, efficiency can reduce the negative impacts of additional electricity demand on the grid,
reducing the need for increased generation and storage capacity, as well as the need to upgrade upstream
transmission and distribution equipment. The Reach Codes Team recommends that jurisdictions adopting an
all-electric reach code for single family buildings also include an efficiency requirement with EDR2 margins
consistent with the all-electric code minimum package results in Table 30.
• The code compliance margins for the ADU all-electric code minimum package are lower than for the single
family prototype and code compliance can be more challenging for smaller dwelling units. As a result, the
Reach Codes Team does not recommend an additional efficiency requirement for all-electric ADU ordinances.
• Electrification combined with increased PV capacity results in utility cost savings and was found to be On-Bill
cost effective in all cases. These results were based on today’s net energy metering rules and do not account
for future changes to utility agreements, which are expected to decrease the value of PV to the consumer.
• For jurisdictions interested in a reach code that allows for mixed fuel buildings the mixed fuel efficiency, PV,
and battery package was found to be cost effective based on TDV in all cases. Cost effectiveness was
marginal because of the high cost of the battery system. EDR2 margins ranged from 7 to 30 for the cost-
effective packages as is shown in Table 31.
• Applying the CARE rates has the overall impact to increase utility cost savings for an all-electric building
compared to a code compliant mixed fuel building, improving On-Bill cost-effectiveness.
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Cost-Effectiveness Analysis: Single Family New Construction 42 Summary
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Local jurisdictions may also adopt ordinances that amend different Parts of the California Building Standards Code or
may elect to amend other state or municipal codes. The decision regarding which code to amend will determine the
specific requirements that must be followed for an ordinance to be legally enforceable. Reach codes that amend Part 6
of the CA Building Code and require energy performance beyond state code minimums must demonstrate the
proposed changes are cost-effective and obtain approval from the Energy Commission.
Table 30. Summary of All-Electric Efficiency EDR2 Margins and Cost-Effectiveness
Climate
Zone
Electric
/Gas Utility
Single Family ADU
Code Min EE EE+PV EE+PV/B
Code Min EE EE+PV EE+PV/B
CZ01 PGE 8.3 18.8 18.8 29.6 0.0 15.1 15.1 24.6
CZ02 PGE 5.7 13.5 13.5 19.1 0.4 9.5 9.5 14.6
CZ03 PGE 4.7 10.5 10.5 15.8 0.0 5.7 5.7 10.5
CZ04 PGE 3.7 8.6 8.6 13.5 0.2 6.3 6.3 10.8
CZ04 CPAU 3.7 8.6 8.6 13.5 0.2 6.3 6.3 10.8
CZ05 PGE 1.1 6.1 6.1 14.3 0.4 2.4 2.4 7.9
CZ05 PGE/SCG 1.1 6.1 6.1 14.3 0.4 2.4 2.4 7.9
CZ06 SCE/SCG 2.5 7.8 7.8 11.6 0.2 6.2 6.2 9.8
CZ07 SDGE 2.3 7.0 7.0 9.9 0.4 6.3 6.3 9.1
CZ08 SCE/SCG 0.6 4.0 4.0 10.4 0.6 3.6 3.6 10.0
CZ09 SCE 1.2 4.6 4.6 9.9 0.6 3.7 3.7 8.8
CZ10 SCE/SCG 1.1 4.6 4.6 10.1 0.4 3.8 3.8 9.1
CZ10 SDGE 1.1 4.6 4.6 10.1 0.4 3.8 3.8 9.1
CZ11 PGE 3.5 8.4 8.4 14.1 0.2 7.7 7.7 13.2
CZ12 PGE 4.0 8.5 8.5 14.7 0.3 6.8 6.8 12.6
CZ12 SMUD/PGE 4.0 8.5 8.5 14.7 0.3 6.8 6.8 12.6
CZ13 PGE 2.1 6.8 6.8 12.0 0.1 6.8 6.8 11.9
CZ14 SCE/SCG 1.6 7.9 7.9 13.2 0.4 7.3 7.3 12.4
CZ14 SDGE 1.6 7.9 7.9 13.2 0.4 7.3 7.3 12.4
CZ15 SCE/SCG 1.6 4.2 4.2 8.6 1.3 6.5 6.5 11.1
CZ16 PG&E 6.0 9.7 9.7 18.1 0.1 8.8 8.8 16.4
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Cost-Effectiveness Analysis: Single Family New Construction 43 Summary
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Table 31. Summary of Mixed Fuel Efficiency EDR2 Margins and Cost-Effectiveness
Climate
Zone
Electric
/Gas Utility
Single Family ADU
EE EE+PV EE+PV/B
EE EE+PV EE+PV/B
CZ01 PGE 12.0 12.0 30.0 14.9 14.9 24.3
CZ02 PGE 8.8 8.8 13.5 9.4 9.4 14.5
CZ03 PGE 5.7 5.7 11.2 6.3 6.3 12.1
CZ04 PGE 4.8 4.8 8.4 6.7 6.7 12.2
CZ04 CPAU 4.8 4.8 8.4 6.7 6.7 12.2
CZ05 PGE 4.8 4.8 16.8 2.3 2.3 7.8
CZ05 PGE/SCG 4.8 4.8 16.8 2.3 2.3 7.8
CZ06 SCE/SCG 6.1 6.1 9.2 6.1 6.1 9.8
CZ07 SDGE 5.5 5.5 8.3 6.3 6.3 9.1
CZ08 SCE/SCG 3.5 3.5 9.5 3.6 3.6 10.1
CZ09 SCE 3.6 3.6 8.6 3.7 3.7 8.9
CZ10 SCE/SCG 3.7 3.7 8.3 3.8 3.8 9.0
CZ10 SDGE 3.7 3.7 8.3 3.8 3.8 9.0
CZ11 PGE 5.7 5.7 11.0 7.5 7.5 13.1
CZ12 PGE 5.3 5.3 11.0 6.8 6.8 12.6
CZ12 SMUD/PGE 5.3 5.3 11.0 6.8 6.8 12.6
CZ13 PGE 4.7 4.7 9.6 7.2 7.2 12.8
CZ14 SCE/SCG 6.2 6.2 11.2 8.5 8.5 14.2
CZ14 SDGE 6.2 6.2 11.2 8.5 8.5 14.2
CZ15 SCE/SCG 4.3 4.3 8.5 6.6 6.6 11.2
CZ16 PG&E 14.9 14.9 22.6 8.7 8.7 16.2
Page 1839 of 2029
Cost-Effectiveness Analysis: Single Family New Construction 44 References
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
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of Electric Costs, Rates, and Equity Issues Pursuant to P.U. Code Section 913.1. Retrieved from
https://www.cpuc.ca.gov/-/media/cpuc-website/divisions/office-of-governmental-affairs-
division/reports/2021/senate-bill-695-report-2021-and-en-banc-whitepaper_final_04302021.pdf
California Public Utilities Commission. (2021b). Database for Energy-Efficient resources (DEER2021 Update). Retrieved
April 13, 2021, from http://www.deeresources.com/index.php/deer-versions/deer2021
California Public Utilities Commission. (2022). Proposed Decision of Commissioner Rechtschaffen: PHASE III DECISION
ELIMINATING GAS LINE EXTENSION ALLOWANCES, TEN-YEAR REFUNDABLE PAYMENT OPTION, AND FIFTY
PERCENT DISCOUNT PAYMENT OPTION UNDER GAS LINE EXTENSION RULES.
E-CFR. (2020). https://www.ecfr.gov/cgi-
bin/retrieveECFR?gp=&SID=8de751f141aaa1c1c9833b36156faf67&mc=true&n=pt10.3.431&r=PART&ty=HTM
L#se10.3.431_197. Retrieved from Electronic Code of Federal Regulations: https://www.ecfr.gov/cgi-
bin/retrieveECFR?gp=&SID=8de751f141aaa1c1c9833b36156faf67&mc=true&n=pt10.3.431&r=PART&ty=HTM
L#se10.3.431_197
Energy & Environmental Economics. (2019). Residential Building Electrification in California. Retrieved from
https://www.ethree.com/wp-
content/uploads/2019/04/E3_Residential_Building_Electrification_in_California_April_2019.pdf
Energy + Environmental Economics. (2020). Time Dependent Valuation of Energy for Developing Building Efficiency
Standards: 2022 Time Dependent Valuation (TDV) and Source Energy Metric Data Sources and Inputs.
E-Source companies. (2020). Behind-the-Meter Battery Market Study. Prepared for San Diego Gas & Electric.
Retrieved from https://www.etcc-ca.com/reports/behind-meter-battery-market-study?dl=1582149166
Horii, B., Cutter, E., Kapur, N., Arent, J., & Conotyannis, D. (2014). Time Dependent Valuation of Energy for Developing
Building Energy Efficiency Standards.
Proctor, J., Wilcox, B., & Chitwood, R. (2018). Central Valley Research Homes Project. California Energy Commission.
Retrieved from
https://www.researchgate.net/publication/342135376_Central_Valley_Research_Homes_Project_--
_Final_CEC_Report
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Cost-Effectiveness Analysis: Single Family New Construction 45 References
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Statewide CASE Team. (2017). Residential High Performance Windows & Doors Codes and Standards Enhancement
(CASE) Initiative 2019 California Energy Code. Retrieved from http://title24stakeholders.com/wp-
content/uploads/2017/09/2019-T24-CASE-Report_Res-Windows-and-Doors_Final_September-2017.pdf
Statewide CASE Team. (2018). Energy Savings Potential and Cost-Effectiveness Analysis of High Efficiency Windows in
California. Prepared by Frontier Energy. Retrieved from https://www.etcc-ca.com/reports/energy-savings-
potential-and-cost-effectiveness-analysis-high-efficiency-windows-california
Statewide CASE Team. (2020a). Nonresidential High Performance Envelope Codes and Standards Enhancement (CASE)
Initiative 2022 California Energy Code. Prepared by Energy Solutions. Retrieved from
https://title24stakeholders.com/wp-content/uploads/2020/10/2020-T24-NR-HP-Envelope-Final-CASE-
Report.pdf
Statewide CASE Team. (2020b). Residential Energy Savings and Process Improvements for Additions and Alterations
Codes and Standards Enhancement (CASE) Initiative 2022 California Energy Code. Prepared by Frontier
Energy. Retrieved from https://title24stakeholders.com/wp-content/uploads/2020/08/SF-Additions-and-
Alterations_Final_-CASE-Report_Statewide-CASE-Team.pdf
Statewide CASE Team. (2020c). Multifamily All-Electric Codes and Standards Enhancement (CASE) Initiative 2022
California Energy Code. Prepared by TRC.
Statewide Reach Codes Team. (2019, August). 2019 Cost-effectiveness Study: Low-Rise Residential New Construction.
Prepared for Pacific Gas and Electric Company. Prepared by Frontier Energy. Retrieved from
https://localenergycodes.com/download/800/file_path/fieldList/2019%20Res%20NC%20Reach%20Codes
Statewide Reach Codes Team. (2021a). Cost-Effectiveness Analysis: Batteries in Single Family Homes. Prepared by
Frontier Energy. Retrieved from
https://localenergycodes.com/download/930/file_path/fieldList/Single%20Family%20Battery%20Cost-
eff%20Report.pdf
Statewide Reach Codes Team. (2021b). 2020 Reach Code Cost-Effectiveness Analysis: Detached Accessory Dwelling
Units. Prepared by TRC. Retrieved from
https://localenergycodes.com/download/760/file_path/fieldList/2019%20New%20Detached%20ADUs%20Co
st-effectiveness%20Report.pdf
TRC, P. E. (2021). 2020 Reach Code Cost-Effectiveness Analysis: Detached Accessory Dwelling Units.
UC Berkeley Center for Community Innovation. (2021). Implementing the Backyard Revolution: Perspectives of
California’s ADU Owners.
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7 Appendices
7.1 Map of California Climate Zones
Climate zone geographical boundaries are depicted in Figure 4. The map in Figure 4 along with a zip-code search
directory is available at: https://ww2.energy.ca.gov/maps/renewable/building_climate_zones.html
Figure 4. Map of California climate zones.
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7.2 Utility Rate Schedules
The Reach Codes Team used the CA IOU and POU rate tariffs detailed below to determine the On-Bill savings for
each package. The California Climate Credit was applied for both electricity and natural gas service for the IOUs using
the 2022 credits shows below.15 The credits were applied to reduce the total calculated annual bill, including any fixed
fees or minimum bill amounts.
7.2.1 Pacific Gas & Electric
The following pages provide details on the PG&E electricity and natural gas tariffs applied in this study. Table 32
describes the baseline territories that were assumed for each climate zone. A net surplus compensation rate of
$0.0362 / kWh was applied to any net annual electricity generation based on a one-year average of the rates between
April 2021 and March 2022.
15 https://www.cpuc.ca.gov/industries-and-topics/natural-gas/greenhouse-gas-cap-and-trade-program/california-
climate-credit
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Table 32: PG&E Baseline Territory by Climate Zone
Baseline
Territory
CZ01 V
CZ02 X
CZ03 T
CZ04 X
CZ05 T
CZ11 R
CZ12 S
CZ13 R
CZ16 Y
The PG&E monthly gas rate in $/therm was applied on a monthly basis for the 12-month period ending August 2021
according to the rates shown in Table 33. The corresponding CARE rates are shown in Table 34.
Table 33: PG&E Monthly Gas Rate ($/therm)
Month Procurement
Charge
Transportation Charge Total Charge
Baseline Excess Baseline Excess
Jan 2022 $0.76338 $1.33589 $1.79545 $2.09927 $2.55883
Feb 2022 $0.73412 $1.33589 $1.79545 $2.07001 $2.52957
Mar 2022 $0.61773 $1.33589 $1.79545 $1.95362 $2.41318
Apr 2021 $0.22304 $1.19868 $1.68034 $1.42172 $1.90338
May 2021 $0.21063 $1.19868 $1.68034 $1.40931 $1.89097
June 2021 $0.21778 $1.20019 $1.68243 $1.41797 $1.90021
July 2021 $0.19109 $1.20019 $1.68243 $1.39128 $1.87352
Aug 2021 $0.22551 $1.20019 $1.68243 $1.4257 $1.90794
Sept 2021 $0.44379 $1.20019 $1.68243 $1.64398 $2.12622
Oct 2021 $0.68120 $1.20019 $1.68243 $1.88139 $2.36363
Nov 2021 $0.81218 $1.20019 $1.68243 $2.01237 $2.49461
Dec 2021 $0.82555 $1.20019 $1.68243 $2.02574 $2.50798
Table 34: PG&E Monthly CARE (GL-1) Gas Rate ($/therm)
Month CARE Discount Total CARE Charge
Baseline Excess Baseline Excess
Jan 2022 ($0.41947) ($0.51139) $1.67790 $2.04554
Feb 2022 ($0.41362) ($0.50553) $1.65449 $2.02214
Mar 2022 ($0.39034) ($0.48226) $1.56138 $1.92902
Apr 2021 ($0.28372) ($0.38006) $1.13490 $1.52022
May 2021 ($0.28124) ($0.37757) $1.12497 $1.51030
June 2021 ($0.28297) ($0.37942) $1.13190 $1.51769
July 2021 ($0.27764) ($0.37408) $1.11054 $1.49634
Aug 2021 ($0.28452) ($0.38097) $1.13808 $1.52387
Sept 2021 ($0.32818) ($0.42462) $1.31270 $1.69850
Oct 2021 ($0.37566) ($0.47211) $1.50263 $1.88842
Nov 2021 ($0.40185) ($0.49830) $1.60742 $1.99321
Dec 2021 ($0.40453) ($0.50098) $1.61811 $2.00390
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7.2.2 Southern California Edison
The following pages provide details on are the SCE electricity tariffs applied in this study. Table 35 describes the
baseline territories that were assumed for each climate zone. A net surplus compensation rate of $0.03339 / kWh was
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applied to any net annual electricity generation based on a one-year average of the rates between April 2021 and
March 2022.
Table 35: SCE Baseline Territory by Climate Zone
Baseline
Territory
CZ06 6
CZ08 8
CZ09 9
CZ10 10
CZ14 14
CZ15 15
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7.2.3 Southern California Gas
Following are the SoCalGas natural gas tariffs applied in this study. Table 36 describes the baseline territories that
were assumed for each climate zone.
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Table 36: SoCalGas Baseline Territory by Climate Zone
Baseline
Territory
CZ05 2
`CZ06 1
CZ08 1
CZ09 1
CZ10 1
CZ14 2
CZ15 1
The SoCalGas monthly gas rate in $/therm was applied on a monthly basis for the 12-month period ending August
2021 according to the rates shown in Table 37. Historical natural gas rate data was only available for SoCalGas’
procurement charges.16 To estimate total costs by month, the baseline and excess transmission charges were
assumed to be relatively consistence and applied for the entire year based on January 2021 and April 2021 costs.
CARE rates reflect the 20 percent discount per the GR tariff.
Table 37: SoCalGas Monthly Gas Rate ($/therm)
Month Procurement
Charge
Transportation Charge Total Charge
Baseline Excess Baseline Excess
Jan 2022 $0.83569 $0.82487 $1.23877 $1.66056 $2.07446
Feb 2022 $0.60655 $0.82487 $1.23877 $1.43142 $1.84532
Mar 2022 $0.55921 $0.82487 $1.23877 $1.38408 $1.79798
Apr 2021 $0.31373 $0.80599 $1.20562 $1.11972 $1.51935
May 2021 $0.35684 $0.80599 $1.20562 $1.16283 $1.56246
June 2021 $0.39460 $0.80599 $1.20562 $1.20059 $1.60022
July 2021 $0.42622 $0.80599 $1.20562 $1.23221 $1.63184
Aug 2021 $0.44599 $0.80599 $1.20562 $1.25198 $1.65161
Sept 2021 $0.44425 $0.82487 $1.23877 $1.26912 $1.68302
Oct 2021 $0.57580 $0.82487 $1.23877 $1.40067 $1.81457
Nov 2021 $0.63799 $0.82487 $1.23877 $1.46286 $1.87676
Dec 2021 $0.65129 $0.82487 $1.23877 $1.47616 $1.89006
16 The SoCalGas procurement and transmission charges were obtained from the following site:
https://www.socalgas.com/for-your-business/energy-market-services/gas-prices
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7.2.4 San Diego Gas & Electric
Following are the SDG&E electricity and natural gas tariffs applied in this study. Table 38 describes the baseline
territories that were assumed for each climate zone. A net surplus compensation rate of $0.04174 / kWh was applied to
any net annual electricity generation based on a one-year average of the rates between April 2021 and March 2022.
Table 38: SDG&E Baseline Territory by Climate Zone
Baseline
Territory
CZ07 Coastal
CZ10 Inland
CZ14 Mountain
The SDG&E monthly gas rate in $/therm was applied on a monthly basis for the 12-month period ending August 2021
according to the rates shown in Table 39. CARE rates reflect the 20 percent discount per the G-CARE tariff.
Table 39: SDG&E Monthly Gas Rate ($/therm)
Month Procurement
Charge
Transportation Charge Total Charge
Baseline Excess Baseline Excess
Jan 2022 $0.83668 $1.43201 $1.70577 $2.26869 $2.54245
Feb 2022 $0.60727 $1.43201 $1.70577 $2.03928 $2.31304
Mar 2022 $0.55988 $1.43201 $1.70577 $1.99189 $2.26565
Apr 2021 $0.31401 $1.44464 $1.70732 $1.75865 $2.02133
May 2021 $0.35719 $1.44464 $1.70732 $1.80183 $2.06451
June 2021 $0.39498 $1.44464 $1.70732 $1.83962 $2.10230
July 2021 $0.42663 $1.44464 $1.70732 $1.87127 $2.13395
Aug 2021 $0.44642 $1.44464 $1.70732 $1.89106 $2.15374
Sept 2021 $0.44468 $1.44464 $1.70732 $1.88932 $2.15200
Oct 2021 $0.57637 $1.38238 $1.63573 $1.95875 $2.21210
Nov 2021 $0.63862 $1.38238 $1.63573 $2.02100 $2.27435
Dec 2021 $0.65194 $1.38238 $1.63573 $2.03432 $2.28767
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7.2.5 City of Palo Alto Utilities
Following are the CPAU electricity and natural gas tariffs applied in this study. The CPAU monthly gas rate in
$/therm was applied on a monthly basis for the 12-month period ending August 2021 according to the rates shown
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in Table 40. The distribution charge was $0.4835/therm for Tier 1 and $1.0426/therm for Tier 2. The monthly service
charge applied was $10.94 per month per the G-1 tariff in effect at the time of the analysis.
Table 40: CPAU Monthly Gas Rate ($/therm)
Effective
Date
Commodity
Rate
Cap and Trade
Compliance
Charge
Transportation
Charge
Carbon
Offset
Charge
G1 Tier 1
Volumetric
Totals
G1 Tier 2
Volumetric
Totals
Jan 2022 $0.77140 $0.04860 $0.15000 $0.04000 $1.53900 $1.83144
Feb 2022 $0.53600 $0.04860 $0.15000 $0.04000 $1.30360 $1.81874
Mar 2022 $0.53700 $0.04860 $0.15000 $0.04000 $1.30460 $1.8565
Apr 2022 $0.59750 $0.07680 $0.14404 $0.04000 $1.38734 $1.8363
May 2021 $0.39010 $0.04860 $0.12200 $0.04000 $1.10450 $1.8889
June 2021 $0.39820 $0.04860 $0.12214 $0.04000 $1.11274 $1.89714
July 2021 $0.48000 $0.04860 $0.12274 $0.04000 $1.22034 $2.04394
Aug 2021 $0.54920 $0.04860 $0.12274 $0.04000 $1.28954 $2.11314
Sept 2021 $0.52170 $0.04860 $0.12274 $0.04000 $1.26204 $1.78012
Oct 2021 $0.71750 $0.04860 $0.12274 $0.04000 $1.45784 $1.83222
Nov 2021 $0.75050 $0.04860 $0.12274 $0.04000 $1.49084 $1.83472
Dec 2021 $0.63210 $0.04860 $0.12274 $0.04000 $1.37244 $1.80442
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7.2.6 Sacramento Municipal Utilities District (Electric Only)
Following are the SMUD electricity tariffs applied in this study.
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7.2.7 Fuel Escalation Assumptions
The average annual escalation rates in Table 41 were used in this study. These are based on assumptions from the
CPUC 2021 En Banc hearings on utility costs through 2030 (California Public Utilities Commission, 2021a). Escalation
rates through the remainder of the 30-year evaluation period are based on the escalation rate assumptions within the
2022 TDV factors. No data was available to estimate electricity escalation rates for CPAU and SMUD, therefore
electricity escalation rates for PG&E and statewide natural gas escalation rates were applied.
Table 41: Real Utility Rate Escalation Rate Assumptions
Statewide Natural
Gas Residential
Average Rate
(%/year, real)
Electric Residential Average Rate
(%/year, real)
PG&E SCE SDG&E
2023 4.6% 1.8% 1.6% 2.8%
2024 4.6% 1.8% 1.6% 2.8%
2025 4.6% 1.8% 1.6% 2.8%
2026 4.6% 1.8% 1.6% 2.8%
2027 4.6% 1.8% 1.6% 2.8%
2028 4.6% 1.8% 1.6% 2.8%
2029 4.6% 1.8% 1.6% 2.8%
2030 4.6% 1.8% 1.6% 2.8%
2031 2.0% 0.6% 0.6% 0.6%
2032 2.4% 0.6% 0.6% 0.6%
2033 2.1% 0.6% 0.6% 0.6%
2034 1.9% 0.6% 0.6% 0.6%
2035 1.9% 0.6% 0.6% 0.6%
2036 1.8% 0.6% 0.6% 0.6%
2037 1.7% 0.6% 0.6% 0.6%
2038 1.6% 0.6% 0.6% 0.6%
2039 2.1% 0.6% 0.6% 0.6%
2040 1.6% 0.6% 0.6% 0.6%
2041 2.2% 0.6% 0.6% 0.6%
2042 2.2% 0.6% 0.6% 0.6%
2043 2.3% 0.6% 0.6% 0.6%
2044 2.4% 0.6% 0.6% 0.6%
2045 2.5% 0.6% 0.6% 0.6%
2046 1.5% 0.6% 0.6% 0.6%
2047 1.3% 0.6% 0.6% 0.6%
2048 1.6% 0.6% 0.6% 0.6%
2049 1.3% 0.6% 0.6% 0.6%
2050 1.5% 0.6% 0.6% 0.6%
2051 1.8% 0.6% 0.6% 0.6%
2052 1.8% 0.6% 0.6% 0.6%
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7.3 Summary of Measures by Package
Table 42 provides the details of the measures in each of the efficiency package by climate zone and case. Table 43
presents the measures for all the single family efficiency + PV + battery packages. Table 44 presents the measures for
all the ADU efficiency packages.
Table 42: Single Family Efficiency Package Measures
Climate
Zone
3
ACH50
R-10
Slab Attic
0.25 Roof
Solar
Reflectance
0.24 U-Factor /
0.50 SHGC
Windows
0.35
W/cfm Buried Ducts
Basic
Compact Hot
Water Credit
1 X R-60 vs R-38 X
2 X R-60 vs R-38 X X X
3 R-60 vs R-30 X X X
4 X R-60 vs R-38 X X X
5 R-49 vs R-30 X X X
6 R-60 vs R-30 X X X
7 R-49 vs R-30 X X
8 R-60 vs R-38 X X X
9 R-60 vs R-38 X X X
10 R-60 vs R-38 X X X X
11 X R-60 vs R-38 X X X X
12 X R-60 vs R-38 X X X X
13 X R-60 vs R-38 X X X X
14 X X R-60 vs R-38 X X X X
15 X R-60 vs R-38 X X X X
16 R-60 vs R-38 X X X
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Table 43: Single Family Mixed Fuel Efficiency + PV + Battery Package Measures
Climate
Zone
3
ACH50
R-10
Slab Attic
0.25 Roof
Solar
Reflectance
0.24 U-
Factor /
0.50 SHGC
Windows
0.30 U-
Factor /
0.50 SHGC
Windows
0.35
W/cfm
Buried
Ducts
Basic
Compact
Hot Water
Credit
1 X X X
2 X R- 49 vs R-38 X X X
3 R-38 vs R-30 X X X
4 X R-49 vs R-38 X X X
5 R-49 vs R-30 X X X
6 R- 49 vs R-30 X X X
7 R-49 vs R-30 X X
8 R- 49 vs R-38 X X X
9 R- 49 vs R-38 X X X
10 X X X X
11 X R-49 vs R-38 X X X X
12 X R- 49 vs R-38 X X X X
13 X R- 49 vs R-38 X X X X
14 X X R- 49 vs R-38 X X X X
15 X R- 49 vs R-38 X X X X
16 R- 49 vs R-38 X X X
Table 44: ADU Efficiency Package Measures
Climate
Zone
3
ACH50
R-10
Slab
0.25 Roof
Solar
Reflectance
0.24 U-Factor /
0.50 SHGC
Windows
Ductless
VCHP
Basic
Compact Hot
Water Credit
1 X X
2 X X X
3 X X
4 X X X
5 X X
6 X X
7 X X
8 X X
9 X X
10 X X X
11 X X X X
12 X X X X
13 X X X X
14 X X X X X
15 X X X X
16 X X
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The efficiency measures added to the All-Electric prescriptive package in Climate Zones that were not compliant are
shown in Table 45 and
Table 46.
Table 45: Single Family All-Electric Code Compliant Efficiency Measures
Climate
Zone
0.24 U-Factor / 0.50
SHGC Windows
Basic Compact Hot
Water Credit
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15 X
16 X
Table 46: ADU All-Electric Code Compliant Efficiency Measures
Climate
Zone
3 ACH50 R-49 vs R-38
Attic
Insulation
0.30 U-Factor /
0.50 SHGC
Windows
0.24 U-Factor /
0.50 SHGC
Windows
Improved HVAC
Fan Efficiency:
0.35 W/cfm
Basic Compact
Hot Water Credit
1
2
3
4 X
5 X X
6 X
7 X
8 X X
9 X X
10 X X
11
12
13 X
14 X X
15 X X
16 X X X X
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As part of the Statewide Codes & Standards Program, the Reach Codes Subprogram is a resource available to
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Our experts develop robust toolkits as well as provide specific technical assistance to local jurisdictions (cities
and counties) considering adopting energy reach codes. These include cost-effectiveness research and
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Prepared by:
Frontier Energy, Inc
Misti Bruceri & Associates, LLC
Prepared for:
Kelly Cunningham, Codes and Standards Program, Pacific Gas and Electric
Last modified: 2023/06/20
Revision: 1.1
2022 Cost-Effectiveness Study:
Multifamily New Construction
Page 1871 of 2029
Cost-Effectiveness Analysis: Multifamily New Construction
Legal Notice
This report was prepared by Pacific Gas and Electric Company and
funded by the California utility customers under the auspices of the
California Public Utilities Commission.
Copyright 2022, Pacific Gas and Electric Company. All rights
reserved, except that this document may be used, copied, and
distributed without modification.
Neither PG&E nor any of its employees makes any warranty,
express or implied; or assumes any legal liability or responsibility for
the accuracy, completeness or usefulness of any data, information,
method, product, policy or process disclosed in this document; or
represents that its use will not infringe any privately-owned rights
including, but not limited to, patents, trademarks or copyrights.
Acronym List
2023 PV$ – Present value costs in 2023
ACH50 – Air Changes per Hour at 50 pascals pressure differential
ACM – Alternative Calculation Method
ADU – Accessory Dwelling Unit
AFUE – Annual Fuel Utilization Efficiency
B/C – Lifecycle Benefit-to-Cost Ratio
BEopt – Building Energy Optimization Tool
BSC – Building Standards Commission
CA IOUs – California Investor-Owned Utilities
CASE – Codes and Standards Enhancement
CBECC-Res – Computer program developed by the California Energy
Commission for use in demonstrating compliance with the
California Residential Building Energy Efficiency Standards
CFI – California Flexible Installation
CFM – Cubic Feet per Minute
CO2 – Carbon Dioxide
CPAU – City of Palo Alto Utilities
CPUC – California Public Utilities Commission
CZ – California Climate Zone
DHW – Domestic Hot Water
DOE – Department of Energy
DWHR – Drain Water Heat Recovery
EDR – Energy Design Rating
EER – Energy Efficiency Ratio
EF – Energy Factor
GHG – Greenhouse Gas
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Cost-Effectiveness Analysis: Multifamily New Construction
HERS Rater – Home Energy Rating System Rater
HPA – High Performance Attic
HPWH – Heat Pump Water Heater
HSPF – Heating Seasonal Performance Factor
HVAC – Heating, Ventilation, and Air Conditioning
IECC – International Energy Conservation Code
IOU – Investor Owned Utility
kBtu – kilo-British thermal unit
kWh – Kilowatt Hour
LBNL – Lawrence Berkeley National Laboratory
LCC – Lifecycle Cost
LLAHU – Low Leakage Air Handler Unit
VLLDCS – Verified Low Leakage Ducts in Conditioned Space
MF – Multifamily
NEEA – Northwest Energy Efficiency Alliance
NEM – Net Energy Metering
NPV – Net Present Value
NREL – National Renewable Energy Laboratory
PG&E – Pacific Gas and Electric Company
POU – Publicly-Owned-Utilities
PV – Photovoltaic
SCE – Southern California Edison
SDG&E – San Diego Gas and Electric
SEER – Seasonal Energy Efficiency Ratio
SF – Single Family
SMUD – Sacramento Municipal Utility District
SoCalGas – Southern California Gas Company
TDV – Time Dependent Valuation
Therm – Unit for quantity of heat that equals 100,000 British thermal units
Title 24 – Title 24, Part 6
TOU – Time-Of-Use
UEF – Uniform Energy Factor
ZNE – Zero-net Energy
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Cost-Effectiveness Analysis: Multifamily New Construction
Summary of Revisions
Date Description Reference (page or section)
2/28/2022 Original Release N/A
6/20/2023 Minor revisions to content; no change to results 2, 3, 32, 33
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Cost-Effectiveness Analysis: Multifamily New Construction
TABLE OF CONTENTS
Executive Summary .......................................................................................................................................................... 1
1 Introduction ................................................................................................................................................................ 4
2 Methodology and Assumptions ............................................................................................................................... 5
2.1 Analysis for Reach Codes ..................................................................................................................................................... 5
2.1.1 Modeling ....................................................................................................................................................................... 5
2.1.2 Cost-Effectiveness ........................................................................................................................................................ 5
2.1.3 Utility Rates ................................................................................................................................................................... 6
2.2 2022 T24 Compliance Metrics .............................................................................................................................................. 8
2.3 Greenhouse Gas Emissions ................................................................................................................................................. 8
3 Prototypes, Measure Packages, and Costs ............................................................................................................ 9
3.2 Measure Definitions and Costs ........................................................................................................................................... 11
3.2.1 Efficiency, Solar PV, and Batteries ............................................................................................................................. 11
3.2.2 All-Electric ................................................................................................................................................................... 15
3.3 Measure Packages ............................................................................................................................................................. 18
4 Results ...................................................................................................................................................................... 20
4.1 All-Electric Prescriptive Code .............................................................................................................................................. 20
4.2 All-Electric Plus PV ............................................................................................................................................................. 23
4.3 Mixed Fuel Efficiency .......................................................................................................................................................... 25
4.4 Mixed Fuel Plus PV (Plus Battery for the 3-Story Prototype) .............................................................................................. 26
4.5 CARE Rate Comparison ..................................................................................................................................................... 29
4.6 Greenhouse Gas Reductions .............................................................................................................................................. 30
5 Summary .................................................................................................................................................................. 32
6 References ............................................................................................................................................................... 34
7 Appendices .............................................................................................................................................................. 36
7.1 Map of California Climate Zones ......................................................................................................................................... 36
7.2 Utility Rate Schedules ......................................................................................................................................................... 37
7.2.1 Pacific Gas & Electric .................................................................................................................................................. 38
7.2.2 Southern California Edison ......................................................................................................................................... 43
7.2.3 Southern California Gas .............................................................................................................................................. 46
7.2.4 San Diego Gas & Electric............................................................................................................................................ 48
7.2.5 City of Palo Alto Utilities .............................................................................................................................................. 53
7.2.6 Sacramento Municipal Utilities District (Electric Only) ................................................................................................. 55
7.2.7 Fuel Escalation Assumptions ...................................................................................................................................... 57
7.3 Cost Details......................................................................................................................................................................... 58
7.4 PG&E Gas Infrastructure Cost Memo ................................................................................................................................. 59
7.5 Central Heat Pump Water Heater Comparison ................................................................................................................... 62
7.6 Summary of Measures by Package .................................................................................................................................... 63
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Cost-Effectiveness Analysis: Multifamily New Construction
LIST OF TABLES
Table ES-1. Summary of Efficiency TDV Compliance Margins and Cost-Effectiveness ....................................................................... 3
Table 1. Utility Tariffs Used Based on Climate Zone ............................................................................................................................ 8
Table 2. Prototype Characteristics ........................................................................................................................................................ 9
Table 3. Base Case Characteristics of the Prototypes ........................................................................................................................ 10
Table 4. Base Package PV Capacities (kW-DC) ................................................................................................................................ 10
Table 5. Incremental Cost Assumptions ............................................................................................................................................. 13
Table 6. Heat Pump Water Heater Incremental System Costs (Present Value (2023$)) .................................................................... 16
Table 7. Heat Pump Space Heater Costs per Dwelling Unit (Present Value (2023$) ......................................................................... 16
Table 8. Lifetime of Water Heating & Space Conditioning Equipment Measures ............................................................................... 17
Table 9. IOU Natural Gas Infrastructure Cost Savings for All-Electric Building................................................................................... 18
Table 10. Multifamily IOU Total Natural Gas Infrastructure Costs ...................................................................................................... 18
Table 11. Multifamily CPAU Total Natural Gas Infrastructure Costs ................................................................................................... 18
Table 12. 3-Story Cost-Effectiveness Results per Dwelling Unit: All-Electric Prescriptive Code ......................................................... 21
Table 13. 5-Story Cost-Effectiveness Results per Dwelling Unit: All-Electric Prescriptive Code ......................................................... 22
Table 14. 3-Story Cost-Effectiveness Results per Dwelling Unit: All-Electric 100% PV ...................................................................... 23
Table 15. 5-Story Cost-Effectiveness Results per Dwelling Unit: All-Electric 100% PV ...................................................................... 24
Table 16. 3-Story Cost-Effectiveness Results per Dwelling Unit: Mixed Fuel Efficiency ..................................................................... 25
Table 17. 5-Story Cost-Effectiveness Results per Dwelling Unit: Mixed Fuel Efficiency ..................................................................... 26
Table 18. 3-Story Cost-Effectiveness Results per Dwelling Unit: Mixed Fuel Efficiency + PV + Battery ............................................. 27
Table 19. 5-Story Cost-Effectiveness Results per Dwelling Unit: Mixed Fuel Efficiency + PV ............................................................ 28
Table 20. On-Bill IOU Cost-Effectiveness Comparison with CARE Tariffs, Results per Dwelling Unit: All-Electric Prescriptive Code 29
Table 21. On-Bill IOU Cost-Effectiveness Comparison with CARE Tariffs, Results per Dwelling Unit: Mixed Fuel Packages ........... 29
Table 22. Summary of Efficiency TDV Compliance Margins and Cost-Effectiveness ......................................................................... 33
Table 23. PG&E Baseline Territory by Climate Zone .......................................................................................................................... 38
Table 24. PG&E Monthly Gas Rate ($/therm) ..................................................................................................................................... 38
Table 25. PG&E Monthly CARE (GL-1) Gas Rate ($/therm)............................................................................................................... 39
Table 26: SCE Baseline Territory by Climate Zone ............................................................................................................................ 43
Table 27. SoCalGas Baseline Territory by Climate Zone ................................................................................................................... 46
Table 28. SoCalGas Monthly Gas Rate ($/therm) .............................................................................................................................. 46
Table 29. SDG&E Baseline Territory by Climate Zone ....................................................................................................................... 48
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Cost-Effectiveness Analysis: Multifamily New Construction
Table 30. SDG&E Monthly Gas Rate ($/therm) .................................................................................................................................. 48
Table 31. CPAU Monthly Gas Rate ($/therm) ..................................................................................................................................... 53
Table 32: Real Utility Rate Escalation Rate Assumptions ................................................................................................................... 57
Table 33. Heat Pump Water Heater First Costs per Building (Present Value (2023$)) ....................................................................... 58
Table 34. Heat Pump Space Heater First Costs per Dwelling Unit (Present Value (2023$) ............................................................... 58
Table 35. 5-Story Cost-Effectiveness: All-Electric Prescriptive Code with R-134a Heat Pump Water Heater .................................... 62
Table 36. Mixed Fuel Efficiency Package Measures .......................................................................................................................... 63
Table 37. Upgrade Package PV Capacities (kW-DC) ......................................................................................................................... 64
LIST OF FIGURES
Figure 1. 3-Story greenhouse gas reductions (metric tons) per dwelling unit ..................................................................................... 31
Figure 2. 5-Story greenhouse gas savings (metric tons) per dwelling unit .......................................................................................... 31
Figure 3. Map of California climate zones. .......................................................................................................................................... 36
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Cost-Effectiveness Analysis: Multifamily New Construction
Executive Summary 1
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Executive Summary
The California Codes and Standards (C&S) Reach Codes program provides technical support to local governments
considering adopting a local ordinance (reach code) intended to support meeting local and/or statewide energy
efficiency and greenhouse gas (GHG) reduction goals. The program facilitates adoption and implementation of the
code when requested by local jurisdictions by providing resources such as cost-effectiveness studies, model language,
sample findings, and other supporting documentation.
This report documents cost-effective combinations of measures that exceed the minimum state requirements, the 2022
Building Energy Efficiency Standards (Title 24, Part 6 or Energy Code), effective January 1, 2023, for newly
constructed multifamily buildings. The analysis considers low-rise and mid-rise multifamily building types and evaluates
mixed fuel and all-electric package options in all sixteen California climate zones (CZs) Packages include a code
compliant electrification package and a mixed fuel efficiency package, as well as the addition of above-code on-site
solar photovoltaic (PV) capacity and battery energy storage. The 2022 Energy Code established electric heat pumps
as the prescriptive baseline for space heating in most climate zones. As a result, this analysis primarily focuses on the
electrification of central water heating. Space heating electrification was also evaluated where the prescriptive heat
pump baseline didn’t apply: In Climate Zone 16 for multifamily buildings three habitable stories or fewer, and Climate
Zones 1 and 16 for multifamily buildings greater than three habitable stories.
This analysis used two different metrics to assess the cost-effectiveness of the proposed upgrades. Both
methodologies require estimating and quantifying the incremental costs and energy savings associated with each
energy efficiency measure over a 30-year analysis period. On-Bill cost-effectiveness is a customer-based lifecycle cost
(LCC) approach that values energy based upon estimated site energy usage and customer utility bill savings using
today’s electricity and natural gas utility tariffs. Time Dependent Valuation (TDV) is the California Energy Commission’s
LCC methodology, which is intended to capture the long-term projected cost of energy including costs for providing
energy during peak periods of demand, carbon emissions, grid transmission and distribution impacts. This is the
methodology used by the Energy Commission in evaluating cost-effectiveness for efficiency measures in Title 24, Part
6.
Two multifamily prototypes were evaluated in this study. A 3-story loaded corridor and a 5-story mixed use prototype,
which combined are estimated to represent 91 percent of new multifamily construction in California.
The following summarizes key results from the study:
• The Reach Codes Team found all-electric new construction to be feasible and cost-effective based on the
California Energy Commission’s Time Dependent Valuation (TDV) metric in all cases. In many cases all-
electric prescriptive code construction results in an increase in utility costs and is not cost-effective On-Bill.
Some exceptions include the SMUD and CPAU territories where lower electricity rates relative to gas rates
result in lower overall utility bills.
• All-electric packages have lower GHG emissions than mixed fuel packages in all cases, due to the clean power
sources currently available from California’s power providers.
• The 2022 Energy Code’s new source energy metric combined with the heat pump space heating baseline in
most climate zones encourages all-electric construction. While the code does not include an electric baseline
for water heating, the penalty for central electric water heating observed in the performance approach in past
code cycles has been removed and a credit is provided for well-designed central heat pump water heaters in
most cases.
• Electrification combined with increased PV capacity results in utility cost savings and was found to be On-Bill
cost-effective in all cases.
• The results in this study are based on today’s net energy metering (NEM 2.0) rules and do not account for
recently approved changes to the NEM tariff (referred to as the net billing tariff). The net billing tariff decreases
the value of PV to the consumer as compared to NEM 2.0. As a result, the cost-effectiveness of the packages
that include above-code PV capacity is expected to be less under the net billing tariff. Conversely, the net
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Cost-Effectiveness Analysis: Multifamily New Construction
Executive Summary 2
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
billing tariff is expected to increase On-Bill cost-effectiveness of the all-electric prescriptive code scenario. An
all-electric home has better on-site utilization of generated electricity from PV than a mixed fuel home with a
similar sized PV system, and as a result exports less electricity to the grid. Since the net-billing tariff values
exports less than under NEM 2.0, the relative impact on annual utility costs to the mixed fuel baseline is
greater.
• This analysis does justify a modest reach based on either efficiency TDV or source energy for all-electric
buildings. However, this may be challenging for some projects given the recent changes to which the industry
must adapt, including the efficiency updates and multifamily restructuring in the 2022 Title 24, Part 6 code.
While project compliance margins using a CO2 refrigerant heat pump water heating system are high, the
Reach Code Team found lower compliance margins using other heat pump water heater system designs.
Focusing on supporting projects to electrify water heating is expected to support the market shift towards more
central heat pump water heaters.
• For jurisdictions interested in a reach code that allows for mixed fuel buildings, a mixed fuel efficiency and PV
package (and battery for the 3-story prototype) was found to be cost-effective based on TDV in all cases and
cost-effective On-Bill in most climate zones. This path, referred to as “Electric-Preferred”, allows for mixed fuel
buildings but requires a higher building performance than for all-electric buildings. The efficiency measures
evaluated in this study did not provide significant compliance benefit. As a result, the Reach Codes Team
recommends establishing a compliance margin target based on source energy or total TDV. This would allow
for PV and battery above minimum code requirements to be used to meet the target.
• Jurisdictions interested in increasing affordable multifamily housing should know that applying the CARE rates
has the overall impact of increasing utility cost savings for an all-electric building in most climate zones
compared to a code compliant mixed fuel building, improving On-Bill cost-effectiveness.
Table ES-1 summarizes results for each prototype and depicts the efficiency TDV compliance margins achieved for
each climate zone and package. All results presented in the table have a positive compliance margin (greater than zero
percent). Cells highlighted in green depict cases with a positive compliance margin and cost-effective results using
both On-Bill and TDV approaches. Cells highlighted in yellow depict cases with a positive compliance margin and cost-
effective results using either the On-Bill or TDV approach. Cells not highlighted depict cases with a positive
compliance margin but that were not cost-effective using either the On-Bill or TDV approach.
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Cost-Effectiveness Analysis: Multifamily New Construction
Executive Summary 3
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Table ES-1. Summary of Efficiency TDV Compliance Margins and Cost-Effectiveness
Climate
Zone
Electric
/Gas Utility
3-Story 5-Story
All-Electric
Prescriptive
Code
All-
Electric
+ PV
Mixed
Fuel
Efficiency
Mixed
Fuel
Efficiency
+ PV +
Battery
All-Electric
Prescriptive
Code
All-
Electric
+ PV
Mixed
Fuel
Efficiency
Mixed
Fuel
Efficiency
+ PV
CZ01 PGE 26% 26% 1% 1% 14% 14% 0% 0%
CZ02 PGE 20% 20% 1% 1% 9% 9% 1% 1%
CZ03 PGE 21% 21% 1% 1% 11% 11% 0% 0%
CZ04 PGE 18% 18% 1% 1% 9% 9% 1% 1%
CZ04 CPAU 18% 18% 1% 1% 9% 9% 1% 1%
CZ05 PGE 23% 23% 1% 1% 12% 12% 0% 0%
CZ05 PGE/SCG 23% 23% 1% 1% 12% 12% 0% 0%
CZ06 SCE/SCG 18% 18% 1% 1% 9% 9% 0% 0%
CZ07 SDGE 20% 20% 0% 0% 11% 11% 0% 0%
CZ08 SCE/SCG 13% 13% 1% 1% 8% 8% 1% 1%
CZ09 SCE 13% 13% 1% 1% 7% 7% 1% 1%
CZ10 SCE/SCG 14% 14% 3% 3% 7% 7% 2% 2%
CZ10 SDGE 14% 14% 3% 3% 7% 7% 2% 2%
CZ11 PGE 14% 14% 3% 3% 8% 8% 2% 2%
CZ12 PGE 17% 17% 2% 2% 9% 9% 2% 2%
CZ12 SMUD/PGE 17% 17% 2% 2% 9% 9% 2% 2%
CZ13 PGE 13% 13% 4% 4% 7% 7% 2% 2%
CZ14 SCE/SCG 13% 13% 3% 3% 6% 6% 2% 2%
CZ14 SDGE 13% 13% 3% 3% 6% 6% 2% 2%
CZ15 SCE/SCG 5% 5% 5% 5% 3% 3% 3% 3%
CZ16 PG&E 24% 24% 5% 5% 9% 9% 2% 2%
Local jurisdictions may also adopt ordinances that amend different Parts of the California Building Standards Code or
may elect to amend other state or municipal codes. The decision regarding which code to amend will determine the
specific requirements that must be followed for an ordinance to be legally enforceable. Reach codes that amend Part 6
of the CA Building Code and require energy performance (including PV and storage) beyond state code minimums
must demonstrate that the proposed changes are cost-effective and obtain approval from the Energy Commission prior
to filing with the BSC.
Model ordinance language and other resources are posted on the C&S Reach Codes Program website at
LocalEnergyCodes.com. Local jurisdictions that are considering adopting an ordinance may contact the program for
further technical support at info@localenergycodes.com.
Page 1881 of 2029
Cost-Effectiveness Analysis: Multifamily New Construction
Introduction 4
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
1 Introduction
This report documents cost-effective combinations of measures that exceed the minimum state requirements, the 2022
Building Energy Efficiency Standards, effective January 1, 2023, for newly constructed multifamily buildings. This report
was developed in coordination with the California Statewide Investor-Owned Utilities (CA IOUs) Codes and Standards
Program, key consultants, and engaged cities—collectively known as the Reach Codes Team. The CA IOU Codes and
Standards Program is comprised of IOUs representatives from Pacific Gas and Electric (PG&E), Southern California
Edison (SCE) and San Diego Gas and Electric (SDG&E) and two Publicly-Owned-Utilities (POUs) – Sacramento
Municipal Utility District (SMUD) and City of Palo Alto Utilities (CPAU),
The analysis considers low-rise and mid-rise multifamily building types and evaluates mixed fuel and all-electric
package options in all sixteen California climate zones (CZs)1 Packages include combinations of efficiency measures,
on-site renewable energy, and battery energy storage.
The California Building Energy Efficiency Standards Title 24, Part 6 (Energy Code) (California Energy Commission,
2022a) is maintained and updated every three years by two state agencies: the California Energy Commission (Energy
Commission) and the Building Standards Commission (BSC). In addition to enforcing the code, local jurisdictions have
the authority to adopt local energy efficiency ordinances—or reach codes—that exceed the minimum standards defined
by Title 24 (as established by Public Resources Code Section 25402.1(h)2 and Section 10-106 of the Building Energy
Efficiency Standards (California Energy Commission, 2022a)). Local jurisdictions must demonstrate that the
requirements of the proposed ordinance are cost-effective and do not result in buildings consuming more energy than
is permitted by Title 24. In addition, the jurisdiction must obtain approval from the Energy Commission and file the
ordinance with the BSC for the ordinance to be legally enforceable.
The Department of Energy (DOE) sets minimum efficiency standards for equipment and appliances that are federally
regulated under the National Appliance Energy Conservation Act, including heating, cooling, and water heating
equipment (E-CFR, 2020). Since state and local governments are prohibited from adopting higher minimum efficiencies
than the federal standards require, the focus of this study is to identify and evaluate cost-effective packages that do not
include high efficiency heating, cooling, and water heating equipment. High efficiency appliances are often the easiest
and most affordable measures to increase energy performance. While federal preemption limits reach code mandatory
requirements for covered appliances, in practice, builders may install any package of compliant measures to achieve
the performance requirements.
1 See Appendix 7.1 Map of California Climate Zones for a graphical depiction of climate zone locations.
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Cost-Effectiveness Analysis: Multifamily New Construction
Methodology and Assumptions 5
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
2 Methodology and Assumptions
2.1 Analysis for Reach Codes
This section describes the approach to calculating cost-effectiveness including benefits, costs, metrics, and utility rate
selection.
2.1.1 Modeling
The Reach Codes Team performed energy simulations using software approved for 2022 Title 24 Code compliance
analysis, CBECC 2022.2.0.
Using the 2022 baseline as the starting point, prospective energy efficiency measures were identified and modeled to
determine the projected site energy (therm and kWh) and compliance impacts. Annual utility costs were calculated
using hourly data output from CBECC, and electricity and natural gas tariffs for each of the investor-owned utilities
(IOUs).
This analysis focused on residential apartments only (a prior study and report analyzed the cost-effectiveness of above
code packages for nonresidential buildings (Statewide Reach Codes Team, 2022b). The Statewide Reach Codes
Team selected measures for evaluation based on the single family 2022 reach code analysis (Statewide Reach Codes
Team, 2022a) and the multifamily 2019 reach code analysis [ (Statewide Reach Codes Team, 2020), (Statewide
Reach Codes Team, 2021)] as well as experience with and outreach to architects, builders, and engineers.
2.1.2 Cost-Effectiveness
2.1.2.1 Benefits
This analysis used two different metrics to assess the cost-effectiveness of the proposed upgrades. Both
methodologies require estimating and quantifying the incremental costs and energy savings associated
with each energy efficiency measure. The main difference between the methodologies is the manner in which they
value energy and thus the cost savings of reduced or avoided energy use:
Utility Bill Impacts (On-Bill): This customer-based lifecycle cost (LCC) approach values energy based upon
estimated site energy usage and customer utility bill savings using the latest electricity and natural gas utility tariffs
available at the time of writing this report. Total savings are estimated over a 30-year duration and include discounting
of future utility costs and energy cost inflation.
Time Dependent Valuation (TDV): This reflects the Energy Commission’s current LCC methodology, which is
intended to capture the total value or cost of energy use over 30 years. This method accounts for long-term projected
costs, such as the cost of providing energy during peak periods of demand, costs for carbon emissions, and grid
transmission and distribution impacts. This metric values energy use differently depending on the fuel source
(natural gas, electricity, and propane), time of day, and season. Electricity used (or saved) during peak periods has a
much higher value than electricity used (or saved) during off-peak periods due to the less inefficient energy generation
sources providing peak electricity (Horii, Cutter, Kapur, Arent, & Conotyannis, 2014). This is the methodology used by
the Energy Commission in evaluating cost-effectiveness for efficiency measures in the 2022 Energy Code.
2.1.2.2 Costs
The Reach Codes Team assessed the incremental costs of the measures and packages over a 30-year lifecycle.
Incremental costs represent the equipment, installation, replacements, and maintenance costs of the proposed
measure relative to the 2022 Energy Code minimum requirements or standard industry practices. Present value of
replacement cost is included for measures with lifetimes less than the evaluation period.
2.1.2.3 Metrics
Cost-effectiveness is presented using net present value (NPV) and benefit-to-cost (B/C) ratio metrics.
NPV: The lifetime NPV is reported as a cost-effectiveness metric, Equation 1 demonstrates how this is calculated. If
the NPV of a measure or package is positive, it is considered cost-effective. A negative values represent net costs.
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Cost-Effectiveness Analysis: Multifamily New Construction
Methodology and Assumptions 6
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
B/C Ratio: This is the ratio of the present value (PV) of all benefits to the present value of all costs over 30 years (PV
benefits divided by PV costs). The criteria benchmark for cost-effectiveness is a B/C ratio greater than one. A value of
one indicates the NPV of the savings over the life of the measure is equivalent to the NPV of the lifetime incremental
cost of that measure. A value greater than one represents a positive return on investment. The B/C ratio is calculated
according to Equation 2.
Equation 1 𝑁𝑁𝑁𝑁𝑁𝑁=𝑁𝑁𝑁𝑁 𝑜𝑜𝑜𝑜 𝑙𝑙𝑙𝑙𝑜𝑜𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙 𝑏𝑏𝑙𝑙𝑏𝑏𝑙𝑙𝑜𝑜𝑙𝑙𝑙𝑙−𝑁𝑁𝑁𝑁 𝑜𝑜𝑜𝑜 𝑙𝑙𝑙𝑙𝑜𝑜𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙 𝑐𝑐𝑜𝑜𝑐𝑐𝑙𝑙
Equation 2 𝐵𝐵𝑙𝑙𝑏𝑏𝑙𝑙𝑜𝑜𝑙𝑙𝑙𝑙−𝑙𝑙𝑜𝑜−𝐶𝐶𝑜𝑜𝑐𝑐𝑙𝑙 𝑅𝑅𝑅𝑅𝑙𝑙𝑙𝑙𝑜𝑜=𝑁𝑁𝑁𝑁 𝑜𝑜𝑜𝑜 𝑙𝑙𝑙𝑙𝑜𝑜𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙 𝑏𝑏𝑙𝑙𝑏𝑏𝑙𝑙𝑜𝑜𝑙𝑙𝑙𝑙𝑁𝑁𝑁𝑁 𝑜𝑜𝑜𝑜 𝑙𝑙𝑙𝑙𝑜𝑜𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙 𝑐𝑐𝑜𝑜𝑐𝑐𝑙𝑙
Improving the efficiency of a project often requires an initial incremental investment. In most cases the benefit is
represented by annual On-Bill utility or TDV savings, and the cost is represented by incremental first cost and
replacement costs. Some packages result in initial construction cost savings (negative incremental cost), and either
energy cost savings (positive benefits), or increased energy costs (negative benefits). In cases where both construction
costs and energy-related savings are negative, the construction cost savings are treated as the ‘benefit’ while the
increased energy costs are the ‘cost.’ In cases where a measure or package is cost-effective immediately (i.e., upfront
construction cost savings and lifetime energy cost savings), B/C ratio cost-effectiveness is represented by “>1”.
The lifetime costs or benefits are calculated according to Equation 3.
Equation 3 𝑁𝑁𝑁𝑁 𝑜𝑜𝑜𝑜 𝑙𝑙𝑙𝑙𝑜𝑜𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙 𝑐𝑐𝑜𝑜𝑐𝑐𝑙𝑙 𝑜𝑜𝑜𝑜 𝑏𝑏𝑙𝑙𝑏𝑏𝑙𝑙𝑜𝑜𝑙𝑙𝑙𝑙=�(𝐴𝐴𝑏𝑏𝑏𝑏𝐴𝐴𝑅𝑅𝑙𝑙 𝑐𝑐𝑜𝑜𝑐𝑐𝑙𝑙 𝑜𝑜𝑜𝑜 𝑏𝑏𝑙𝑙𝑏𝑏𝑙𝑙𝑜𝑜𝑙𝑙𝑙𝑙)𝑡𝑡(1 +𝑜𝑜)𝑡𝑡𝑛𝑛
𝑡𝑡=0
Where:
• n = analysis term in years
• r = discount rate
The following summarizes the assumptions applied in this analysis to both methodologies.
• Analysis term of 30 years
• Real discount rate of three percent
TDV is a normalized monetary format and there is a unique procedure for calculating the present value benefit of TDV
energy savings. The present value of the energy cost savings in dollars is calculated by multiplying the TDV savings
(reported by the CBECC simulation software) by a NPV factor developed by the Energy Commission (see E3’s 2022
TDV report for details (Energy + Environmental Economics, 2020)). The 30-year residential NPV factor is $0.173/kTDV
for the 2022 Energy Code.
Equation 4 𝑇𝑇𝑇𝑇𝑁𝑁 𝑁𝑁𝑁𝑁 𝑜𝑜𝑜𝑜 𝑙𝑙𝑙𝑙𝑜𝑜𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙 𝑏𝑏𝑙𝑙𝑏𝑏𝑙𝑙𝑜𝑜𝑙𝑙𝑙𝑙= 𝑇𝑇𝑇𝑇𝑁𝑁 𝑙𝑙𝑏𝑏𝑙𝑙𝑜𝑜𝑒𝑒𝑒𝑒 𝑐𝑐𝑅𝑅𝑠𝑠𝑙𝑙𝑏𝑏𝑒𝑒𝑐𝑐 ∗ 𝑁𝑁𝑁𝑁𝑁𝑁 𝑜𝑜𝑅𝑅𝑐𝑐𝑙𝑙𝑜𝑜𝑜𝑜
2.1.3 Utility Rates
In coordination with the CA IOU rate team (comprised of representatives from PG&E, SCE, SDG&E, SMUD, and
CPAU), the Reach Codes Team determined appropriate utility rates for each climate zone in order to calculate utility
costs and determine On-Bill cost-effectiveness for the proposed measures and packages. The utility tariffs,
summarized in Table 1, were determined based on the most prevalent active rate in each territory. Utility rates were
applied to each climate zone based on the predominant IOU serving the population of each zone, with a few climate
zones evaluated multiple times under different utility scenarios. Climate Zones 10 and 14 were evaluated with both
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SCE for electricity and Southern California Gas Company (SoCalGas) for gas and SDG&E tariffs for both electricity
and gas since each utility has customers within these climate zones. Climate Zone 5 is evaluated under both PG&E
and SoCalGas natural gas rates. Two POU or municipal utility rates were also evaluated: SMUD in Climate Zone 12
and CPAU in Climate Zone 4.
For the IOUs in-unit gas was evaluated under the G1 rate and central gas for water heating was evaluated under the
relevant master metered gas tariff, GM. Electricity use for central water heating was evaluated using the residential
TOU rates. The water heating utility bill was calculated separately from the in-unit electricity bill. Photovoltaic (PV) and
battery energy storage benefits were applied according to virtual net energy metering (VNEM) rules.2 PV was first
assigned to the central water heating meter to offset 100 percent of the electricity use. The remaining PV and all of the
battery impacts were then split evenly across the apartment meters. The same approach was applied for CPAU and
SMUD using the rates described in Table 1.
The multifamily prototypes used in this analysis include common area spaces that serve the residents (lobby, leasing
office, corridors, etc.). Most of the energy use for these spaces could not be separated from that for the dwelling units
within the CBECC model. As a result, average per dwelling unit hourly energy use was calculated to include both the
dwelling unit and common space energy use.
First-year utility costs were calculated using hourly electricity and natural gas output from CBECC and applying the
utility tariffs summarized in Table 1. Annual costs were also estimated for customers eligible for the CARE tariff
discounts on both electricity and natural gas bills. The CARE tariff was only applied to the in-unit apartment meters.
Appendix 7.2 Utility Rate Schedules includes details of each utility tariff.
For cases with PV generation, the approved NEM 2.0 tariffs were applied along with minimum daily use billing and
mandatory non-bypassable charges. In December the California Public Utilities Commission (CPUC) issued a decision
adopting a net billing tariff (NBT) as a successor to NEM 2.0 that will go into effect April of 2023 3 Given the recent
timing of this decision there was not time to incorporate these changes into this analysis. The Reach Codes Team
conducted a limited sensitivity analysis on the impacts of NBT relative to NEM 2.0 on utility bills. It was found that utility
costs will increase for all homes with PV systems; however, the increase was less for an all-electric building compared
to a mixed fuel building with a similarly sized PV system. As a result of better onsite utilization of PV generation and
thus fewer exports to the grid, the Reach Codes Team expects the cost-effectiveness for the electrification scenarios
for the all-electric home evaluated in this report to improve under NBT. Conversely, cost-effectiveness of increasing PV
capacity is expected to be reduced under NBT.
2 PG&E: https://www.pge.com/tariffs/assets/pdf/tariffbook/ELEC_SCHEDS_NEM2V.pdf
SDG&E: https://tariff.sdge.com/tm2/pdf/tariffs/ELEC_ELEC-SCHEDS_NEM-V-ST.pdf
SCE:
https://edisonintl.sharepoint.com/teams/Public/TM2/Shared%20Documents/Forms/AllItems.aspx?ga=1&id=%2Fteams
%2FPublic%2FTM2%2FShared%20Documents%2FPublic%2FRegulatory%2FTariff%2DSCE%20Tariff%20Books%2F
Electric%2FSchedules%2FOther%20Rates%2FELECTRIC%5FSCHEDULES%5FNEM%2DV%2DST%2Epdf&parent=
%2Fteams%2FPublic%2FTM2%2FShared%20Documents%2FPublic%2FRegulatory%2FTariff%2DSCE%20Tariff%20
Books%2FElectric%2FSchedules%2FOther%20Rates
3 https://www.cpuc.ca.gov/nemrevisit
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Table 1. Utility Tariffs Used Based on Climate Zone
Climate Zones Electric / Gas Utility Electricity Natural Gas
IOUs
1-5,11-13,16 PG&E / PG&E E-TOU Option C G1 (in-unit) & GM
(central water heating)1
5 PG&E / SoCalGas E-TOU Option C GM
6, 8-10, 14, 15 SCE / SoCalGas TOU-D Option 4-9 GM
7, 10, 14 SDG&E / SDG&E TOU-DR-1 GM
POUs
4 CPAU / CPAU E-1 (in-unit) & E-2 (central
water heating) G-2
12 SMUD / PG&E R-TOD, RT02 (in-unit) &
RSMM (central water heating) GM
1G1 rate applied to gas use within the apartment units, which only occurs in Climate Zones 1 and 16, see
Section 3 for details. GM rate applied to gas use for central water heating.
Utility rates are assumed to escalate over time according to the assumptions from the CPUC 2021 En Banc hearings
on utility costs through 2030 (California Public Utilities Commission, 2021a). Escalation rates through the remainder of
the 30-year evaluation period are based on the escalation rate assumptions within the 2022 TDV factors. See
Appendix 7.2.7 Fuel Escalation Assumptions for details.
2.2 2022 T24 Compliance Metrics
2022 Title 24, Part 6 Section 170.1 defines the energy budget of the building based on source energy and TDV energy
for space-conditioning, indoor lighting, mechanical ventilation, PV and battery storage systems, service water heating
and covered process loads. In 2022, the Energy Commission introduced the new compliance metric of source energy,
which differs by fuel source (as does TDV) and is a reasonable proxy for greenhouse gas emissions. Additionally, for
multifamily buildings four habitable stories and higher prescriptive requirements for PV and battery systems were also
introduced. This led to the need to differentiate an efficiency compliance metric, which ensured that the building met
minimum efficiency standards, and a total energy compliance metric which incorporated the PV and battery standards.
In order to be compliant with the building code a building needs to comply with all three compliance metrics described
below:
• Efficiency TDV. Efficiency TDV accounts for all regulated end-uses but does not include the impacts of PV
and battery storage.
• Total TDV. Total TDV includes regulated end-uses and accounts for PV and battery storage contributions.
• Source Energy. Source energy is based on fuel used for power generation and distribution.
2.3 Greenhouse Gas Emissions
The analysis reports the greenhouse gas (GHG) emission estimates based on assumptions within CBECC. There are
8,760 hourly multipliers accounting for time dependent energy use and carbon based on source emissions, including
renewable portfolio standard projections. There are two series of multipliers—one for Northern California climate
zones, and another for Southern California climate zones.4 GHG emissions are reported as average annual metric tons
of CO2 equivalent over the 30-year building lifetime.
4 CBECC multipliers are the same for CZs 1-5 and 11-13 (Northern California), while there is another set of multipliers for CZs 6-10
and 14-16 (Southern California).
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3 Prototypes, Measure Packages, and Costs
This section describes the prototypes, measures, costs, and the scope of analysis drawing from previous reach code
research where appropriate.
3.1 Prototype Characteristics
The Energy Commission defines building prototypes which it uses to evaluate the cost-effectiveness of proposed
changes to Title 24 requirements. There are 4 multifamily prototypes used in code development: a 2-story garden style,
a 3-story loaded corridor, a 5-story mixed use and a 10-story mixed use. Based on work completed for the 2022 Title
24 code development, the 3-story and the 5-story represent 33 percent and 58 percent, respectively, of new multifamily
construction in California. As a result, these two prototypes are used in this analysis. Additional details on all four
prototypes can be found in the Multifamily Prototypes Report (TRC, 2019).
Table 2 describes the basic characteristics of each prototype.
Table 2. Prototype Characteristics
Characteristic 3-Story Loaded
Corridor 5-Story Mixed Use
Conditioned Floor Area 39,372 ft2
113,100 ft2 total:
33,660 ft2 nonresidential
79,440 ft2 residential
Num. of Stories 3
6 Stories total:
1 story parking garage (below grade)
1 story of nonresidential space
4 stories of residential space
Num. of Bedrooms
(6) Studio
(12) 1-bed
(12) 2-bed
(6) 3-bed
(8) studios
(40) 1-bed units
(32) 2-bed units
(8) 3-bed units
Window-to-Wall Area Ratio 25% 25%
Wall Type Wood framed Wood frame over a first-floor concrete
podium
Roof Type Flat roof Flat roof
Foundation Slab-on-grade Concrete podium with underground
parking
The methodology used in the analyses for each of the prototypical building types begins with a design that precisely
meets the minimum 2022 prescriptive requirements.5 Table 170.2-A and 170.2-B in the 2022 Standards (California
Energy Commission, 2022a) list the prescriptive measures that determine the baseline design in each climate zone.
Other features are designed to meet, but not exceed, the minimum requirements and are consistent with the Standard
Design in the ACM Reference Manual (California Energy Commission, 2022c). The analysis also assumed electric
resistance cooking in the apartment units to reflect current market data. The 3-story building prototype includes a
central laundry facility, and the 5-story assumes laundry in the units. Laundry equipment was assumed to be electric in
all cases; electrification of laundry equipment was not addressed in this study. The nonresidential 2022 reach code
analysis (Statewide Reach Codes Team, 2022b) did consider electrification of central laundry facilities within the small
hotel prototype.
Table 3 describes characteristics as they were applied to the base case energy model in this analysis. In a shift from
the 2019 Standards, the 2022 Standards define a prescriptive fuel source for space heating establishing an electric
5Due to planned software updates to how the prescriptive requirements are applied in the Standard Design and challenges for
certain space types with sizing heating and cooling equipment the same in the Proposed Design as in the Standards, the results
compliance margins for the base case models were not exactly zero percent..
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heat pump baseline in all climate zones except 16 for multifamily buildings three habitable stories and fewer and 1 and
16 for multifamily buildings four habitable stories and greater.
Table 3. Base Case Characteristics of the Prototypes
Characteristic 3-Story Loaded Corridor 5-story Mixed Use
Space
Heating/Cooling1
Individual split systems with ducts in
conditioned space
CZ 1-15: Heat pump
CZ 16: Natural gas furnace with air
conditioner
Individual split systems with ducts in
conditioned space
CZ2-15: Heat pump
CZ1, 16: Dual-fuel heat pump with
natural gas backup
Ventilation Individual balanced fans, continuously
operating
Individual balanced fans, continuously
operating
Water Heater1
Natural gas central boiler with solar
thermal sized to meet the prescriptive
requirements by climate zone.
Natural gas central boiler with solar
thermal sized to meet the prescriptive
requirements by climate zone.
Hot Water
Distribution Central recirculation Central recirculation
Cooking Electric Electric
Clothes Drying Electric (central) Electric (in-unit)
PV System
Sized according to the prescriptive
requirements in Equation 170.2-C of the
2022 Title 24 Standards. Size differs by
climate zone ranging from 1.60 kW to
2.90 kW per dwelling unit, see Table 4.
Sized according to the prescriptive
requirements in Equation 170.2-D of the
2022 Title 24 Standards. Size differs by
climate zone ranging from 2.26 kW to
3.34 kW per dwelling unit, see Table 4.
Battery System None None
1 Equipment efficiencies are equal to minimum federal appliance efficiency standards.
Table 4 summarizes the PV capacities for the base case packages.
Table 4. Base Package PV Capacities (kW-DC)
Climate
Zone
Base Package
3-Story 5-Story
CZ01 2.00 2.26
CZ02 1.79 2.68
CZ03 1.70 2.26
CZ04 1.75 2.68
CZ05 1.60 2.26
CZ06 1.77 2.68
CZ07 1.67 2.68
CZ08 1.91 2.68
CZ09 1.92 2.68
CZ10 1.98 2.68
CZ11 2.21 2.68
CZ12 1.96 2.68
CZ13 2.33 2.68
CZ14 1.94 2.68
CZ15 2.90 3.34
CZ16 1.76 2.26
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3.2 Measure Definitions and Costs
Measures evaluated in this study fall into two categories: those associated with general efficiency, onsite generation,
and demand flexibility and those associated with building electrification. The Reach Codes Team selected measures
based on cost-effectiveness as well as decades of experience with residential architects, builders, and engineers along
with general knowledge of the relative consumer acceptance of many measures. This analysis focused on measures
that impacted the residential dwelling units only.
The following sections describe the details and incremental cost assumptions for each of the measures. Incremental
costs represent the equipment, installation, replacement, and maintenance costs of the proposed measures relative to
the base case. Replacement costs are applied for roofs, mechanical equipment, PV inverters and battery systems over
the 30-year evaluation period. Incremental maintenance costs are estimated for PV systems, but not any other
measures. Costs were estimated to reflect costs to the building owner. All costs are provided as present value in 2023
(2023 PV$).
The Reach Codes Team obtained measure costs from distributors, contractors, literature review, and online sources
such as Home Depot and RS Means. Contractor markups are incorporated. These are the Reach Codes Team best
estimate of average costs statewide. Regional variation in costs is not accounted for, although it's recognized that local
costs may differ. Cost increases due to recent high inflation rates and supply chain delays are not included.
3.2.1 Efficiency, Solar PV, and Batteries
The following are descriptions of each of the efficiency, PV, and battery measures evaluated under this analysis and
applied in at least one of the packages presented in this report. Table 5 summarizes the incremental cost assumptions
for each of these measures. These measures were evaluated for all climate zones but were ultimately adopted in a
subset of climate zones based on cost-effectiveness outcomes.
Lower U-Factor Fenestration: Reduce window U-factor to 0.24. The prescriptive U-factor is 0.30 in all climate zones
except Climate Zones 7 and 8 where it is 0.34. This measure is included in Climate Zone 16 only.
Cool Roof: Install a roofing product that’s rated by the Cool Roof Rating Council to have an aged solar reflectance
(ASR) equal to or greater than 0.70. Low-sloped roofs were assumed in all cases. The 2022 Title 24 specifies a
prescriptive ASR of 0.63 for Climate Zones 9 through 11 and 13 through 15. This measure is included in Climate Zones
9 through 15.
Low Pressure Drop Ducts: Upgrade the duct distribution system to reduce external static pressure and meet a
maximum fan efficacy of 0.35 Watts per cfm. This may involve upsizing ductwork, reducing the total effective length of
ducts, and/or selecting low pressure drop components such as filters. Fan watt draw must be verified by a HERS rater
according to the procedures outlined in the 2022 Reference Appendices RA3.3 (California Energy Commission,
2022b). This measure is included in Climate Zones 1 and 10 through 16.
Verified Low Leakage Ducts in Conditioned Space: Seal the ducts to achieve a measured leakage no greater than
25 cfm leakage to outside. This may be verified using a guarded blower door test to isolate leakage to outside.
Alternatively, this can also be satisfied by demonstrating that total leakage is not greater than 25 cfm. Ducts are
assumed to already be located in conditioned space in the baseline. This measure is included in all climate zones.
Solar PV: Installation of on-site PV is required in the 2022 residential code unless an exception is met. The PV sizing
methodology in each package was developed to offset annual building electricity use and avoid oversizing which would
violate net energy metering (NEM) rules.6 In all cases, PV is evaluated in CBECC according to the California Flexible
Installation (CFI) assumptions. This measure is included in all climate zones.
Battery Energy Storage: A battery system was evaluated in CBECC-Res with control type set to “Time-of-Use” and
with default efficiencies of 95% for both charging and discharging. This control option assumes the battery system will
6 NEM rules apply to the IOU territories only.
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charge or discharge based on a utility tariff time-of use signal. To qualify, the battery system must meet the
requirements outlined in the 2022 Reference Appendices JA12.2.3.2 (California Energy Commission, 2022b). This
measure is included in all climate zones but only for the 3-story prototype. A 100kWh battery was applied following the
battery sizing requirements for multifamily buildings more than three habitable stories per Equation 170.2-E of the 2022
Energy Code.
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Table 5. Incremental Cost Assumptions
Measure
Performance
Level
Incremental Cost per
Dwelling Unit
(2023 PV$)
Source & Notes 3-Story 5-Story
Non-Preempted Measures
Window U-factor 0.24 vs 0.30 $536 $489 $4.23/ft2 of window area based on analysis conducted for the 2019 and 2022 Title 24 cycles
(Statewide CASE Team, 2018).
Low-Sloped Cool
Roof Aged Solar
Reflectance
0.63 vs 0.10 $314 $222
$0.525/ft2 of roof area first incremental cost based on the 2022 Residential Additions and
Alterations CASE Report (Statewide CASE Team, 2020b).Total costs assume present value
of replacement at year 15.
0.70 vs 0.63 $24 $17
$0.04/ft2 of roof area first incremental cost based on the 2022 Nonresidential High
Performance Envelope CASE Report (Statewide CASE Team, 2020a). Costs assume a
blended average across roofing product types. Total costs assume present value of
replacement at year 15.
Low Pressure
Drop Ducts
0.35 vs 0.45
W/cfm $44 $44
Costs assume half-hour labor per multifamily dwelling unit. Labor rate of $88 per hour is from
2022 RS Means for sheet metal workers and includes a weighted average City Cost Index
for labor for California.
Verified Low
Leakage Ducts in
Conditioned
Space
≤25 cfm leakage
to outside $132 $132
Costs assume half-hour labor per multifamily dwelling unit and a $100 HERS Rater fee.
Labor rate of $88 per hour is from 2022 RS Means for sheet metal workers and includes a
weighted average City Cost Index for labor for California. Ducts are already assumed to be
located in conditioned space and the incremental costs reflect additional sealing and testing
only.
PV + Battery
PV System
First Cost $1.47/W $1.47/W
First costs from LBNL’s Tracking the Sun 2022 costs (Barbose, Darghouth, O'Shaughnessy,
& Forrester, 2022) and represent median costs in California in 2021 of $2.10/WDC for
nonresidential greater than 100kWDC systems. The first cost was reduced by the solar
energy Investment Tax Credit (ITC) of 30%.1 Costs are presented as the average of 2023,
2024, and 2025.
Inverter replacement cost of $0.14/WDC present value includes replacements at year 11 at
$0.15/WDC (nominal) and at year 21 at $0.12/WDC (nominal) per the 2019 PV CASE Report
(California Energy Commission, 2017).
System maintenance costs of $0.31/WDC present value assume $0.02/WDC (nominal)
annually per the 2019 PV CASE Report (California Energy Commission, 2017).
Inverter
replacement $0.14/W $0.14/W
Maintenance $0.31/W $0.31/W
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Measure
Performance
Level
Incremental Cost per
Dwelling Unit
(2023 PV$)
Source & Notes 3-Story 5-Story
Battery
First cost $700/kWh n/a
First cost of $1,000/kWh from LBNL’s Tracking the Sun 2022 costs (Barbose, Darghouth,
O'Shaughnessy, & Forrester, 2022) for residential systems > 30kWh. The report derived
costs from California’s Self-Generation Incentive Program (SGIP) residential participant cost
data. First cost is reduced by the solar energy ITC of 30%.1 No SGIP incentives are included.
Costs are assumed to remain consistent at $1,000/kWh through 2025 and then reduced by
7% annually based on SDG&E’s Behind-the-Meter Battery Market Study (E-Source
companies, 2020) over a 10 year period. Replacement is assumed at years 10 and 20. At
year 10 the replacement cost is based on the average of expected 2033, 2034, and 2035
costs after applying the ITC for a future value cost of $435. Replacement cost at year 20 is
based on a future value cost of $484 and does not include any ITC reduction.
Replacement
cost $564/kWh n/a
1As part of the Inflation Reduction Act in August 2022 the Section 25D Investment Tax Credit was extended and raised to 30% through 2032 with a step-down to
26% in 2033 and 22% in 2034. It’s assumed that the ITC is not renewed and is 0% starting in 2035. https://www.irs.gov/pub/taxpros/fs-2022-40.pdf.
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3.2.2 All-Electric
This analysis compared a code compliant mixed fuel prototype, which uses natural gas for water heating only in most
climate zones, with a code compliant all-electric prototype. In these cases, the relative costs between natural gas and
electric appliances and natural gas infrastructure and the associated infrastructure costs for not providing natural gas
to the building were included.
To estimate costs the Reach Codes Team leveraged costs from the 2022 Multifamily All-Electric CASE Report
(Statewide CASE Team, 2020c) and the 2019 reach code multifamily cost-effectiveness studies ( (Statewide Reach
Codes Team, 2020), (Statewide Reach Codes Team, 2021)), and online equipment research. Present value
replacement costs are included in the total lifetime incremental costs.
3.2.2.1 Water Heating
Federal regulations establish minimum efficiency requirements for heat pump water heaters with rated storage volume
less than 120 gallons. While some heat pump water heaters falling into this regulated category can be used in a central
water heater design, they are not required and therefore this measure does not trigger federal preemption and heat
pump equipment of any efficiency level may be used for this analysis to justify the basis of a reach code.
For the central heat pump water heating system in the 3-story prototype the system design was based on the 2022 All-
Electric Multifamily CASE Report (Statewide CASE Team, 2020c) and used CO2 refrigerant based heat pump water
heaters (four Sanden GS3-45HPA-US units), 525 gallons of storage, and a 250 gallon electric resistance swing tank.
The 2022 CASE work based the 5-story system design on Colmac R-134a refrigerant heat pump water heaters. While
this is an acceptable design, R-134a or R-410a refrigerant heat pump water heaters were found to be less cost-
effective for the prototypes evaluated in this analysis due to higher incremental costs and lower overall performance
relative to CO2 refrigerant products. As such, the Reach Codes Team evaluated a CO2 refrigerant system for the 5-
story prototype for this analysis. As part of the 2025 Energy Code update cycle, designs for both multifamily prototypes
are being reexamined using CO2 refrigerant heat pump water heaters. While full design and cost information was not
yet available for this analysis, preliminary design data was used to inform sizing of a Sanden system for this prototype.
The system used 10 heat pump water heaters (Sanden GS3-45HPA-US units), 800 gallons of storage, and a 200
gallon electric resistance swing tank.
Table 6 reports costs for the central heat pump water heating systems relative to a gas boiler system with solar thermal
that meets the prescriptive requirements of 20% solar fraction in Climate Zones 1 through 9 and 35% solar fraction in
Climate Zones 10 through 16. Costs include equipment and labor, gas piping within the building for the boiler system,
and additional electrical service necessary for the heat pump system. Replacement costs are based on an effective
useful life of 15 years for the water heaters and tanks, and 20 years for the solar thermal collectors. For the solar
thermal systems, it’s also assumed that the glycol is replaced at years 9, 18 and 27. Additional details on cost
assumptions are presented in Appendix 7.3 Cost Details.
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Table 6. Heat Pump Water Heater Incremental System Costs (Present Value (2023$))
Item
3-Story 5-Story
Source & Notes Central
Gas
Boiler
Central
Heat
Pump
Central
Gas
Boiler
Central
Heat
Pump
First Cost CZs 1-9 $173,772 $211,531 $279,163 $343,920 3-story costs directly from 2022
Multifamily All-Electric CASE
Report. 5-story costs estimated
based on component costs for
the 3-story from the CASE
report.
CZs 10-16 $182,810 $300,883
Replacement Cost CZs 1-9 $32,297
$44,263
$59,930
$110,659
CZs 10-16 $36,943 $69,361
Total Incremental
Cost
CZs 1-9
n/a
$49,725
n/a
$115,486
CZs 10-16 $36,041 $84,335
Incremental Cost
per Dwelling Unit
CZs 1-9 $1,381 $1,312
CZs 10-16 $1,001 $958
3.2.2.2 Space Heating
Table 7 presents the costs for heat pump space heater conversion from gas equipment. In most climate zones the
baseline per the 2022 Energy Code is a heat pump space heater, so these costs are only applied in a couple of
instances. For the 3-story prototype the baseline in Climate Zone 16 is a gas furnace and air conditioner. For the 5-
story prototype the baseline in Climate Zones 1 and 16 is a dual fuel heat pump with a gas furnace as backup. Costs
include equipment and labor, gas piping within the building for the boiler system, and additional electrical service
necessary for the heat pump system. Most of the cost difference between the two systems is attributed to higher labor
costs to install the gas system as a result of gas piping and venting. Additional details on cost assumptions are
presented in Appendix 7.3 Cost Details.
Table 7. Heat Pump Space Heater Costs per Dwelling Unit (Present Value (2023$)
Item
3-Story 5-Story
Source & Notes Furnace +
Split AC
Heat
Pump
Furnace +
Split HP
Heat
Pump
First Cost
$20,667 $16,776 $21,245 $16,597
Costs largely based on the 2022
Multifamily All-Electric CASE Report with
some updates to reflect online equipment
cost research and labor cost alignments.
Replacement Cost $8,059 $7,326 $9,052 $7,326 See lifetimes referenced in Table 8.
Residual value at the end of the 30-year
analysis period was accounted for to
represent the remaining life of any
equipment. Residual Value ($1,591) $0 $0 $0
Total $27,135 $24,102 $30,296 $23,924
Incremental Cost ($3,032) ($6,373)
Equipment lifetimes applied in this analysis for the space conditioning measures are summarized in Table 8. The
lifetime for the heat pump, furnace, and air conditioner are based on the Database for Energy Efficient Resources
(DEER) (California Public Utilities Commission, 2021b). In DEER, heat pump and air conditioner measures are
assigned an effective useful lifetime (EUL) of 15 years and a furnace an EUL of 20 years. The heating and cooling
system components are typically replaced at the same time when one reaches the end of its life and the other is near
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it. Therefore, it is assumed that both the furnace and air conditioner are replaced at the same time at year 17.5,
halfway between 15 and 20 years. For HVAC system costing, air-conditioning is included in all cases in both the base
case and proposed models.
Table 8. Lifetime of Water Heating & Space Conditioning Equipment Measures
Measure Lifetime
Gas Furnace 17.5
Air Conditioner 17.5
Heat Pump 15
Dual Fuel Heat Pump 15
3.2.2.3 Natural Gas Infrastructure
Eliminating natural gas to a building saves costs associated with connecting a service line from the street main to the
building, piping distribution within the building, and monthly meter customer charges from the utility. This section
focuses on the first item, not connecting gas service to the building. The latter two are captured in the appliance costs
and the utility bill analysis. Cost savings for removing natural gas infrastructure to a multifamily building in IOU territory
are presented in Table 9 and Table 10. These costs are applied as cost savings for the all-electric case when
compared to the mixed fuel baseline.
These costs are project dependent and may be significantly impacted by such factors as utility territory, site
characteristics, distance to the nearest natural gas main and main location, joint trenching, whether work is conducted
by the utility or a private contractor, and number of dwelling units per development. All gas utilities participating in this
study were solicited for cost information.
Service Extension: Service extension costs to the building were taken from a PG&E memo dated December 5, 2019
to Energy Commission staff (see Appendix 7.4 PG&E Gas Infrastructure Cost Memo for a copy of the memo). The
estimated cost of $6,750 excludes costs for trenching and assumes nonresidential new construction within a developed
area. For the 5-story building the cost is apportioned between the residential and nonresidential spaces in the building
based on associated conditioned floor areas where 84 percent is residential. All of the spaces in the 3-story building
are residential based.
Today, total costs are reduced to account for deductions per the Utility Gas Main Extensions rules.7 These rules
categorize distribution line extensions as “refundable” costs, which are offset or subsidized by all other ratepayers. The
CPUC issued a Decision in September 2022 that eliminates the subsidies effective July 1, 2023 (California Public
Utilities Commission, 2022). Since most of the development that will occur during the three-year 2022 code cycle
(2023-2025) will not be subject to these deduction allowances they are not included in this analysis.
Meter: Cost per meter provided by PG&E of $3,600 for a commercial meter to serve the central water heating and
$600 per multifamily dwelling unit. The $600 dwelling unit meter is only applied in Climate Zone 16 for the 3-story
prototype and Climate Zones 1 and 16 for the 5-story prototypes where gas is used either for primary or backup space
heating. Two scenarios are presented in the tables. One is the case with electric space heating, no in-unit gas and the
only residential gas use is to serve the central water heating system. The other case represents the scenario where
there is in-unit gas to service space heating.
7 PG&E Rule 15: https://www.pge.com/tariffs/assets/pdf/tariffbook/GAS_RULES_15.pdf.
SoCalGas Rule 20: https://www.socalgas.com/regulatory/tariffs/tm2/pdf/20.pdf.
SDG&E Rule 15: https://tariff.sdge.com/tm2/pdf/GAS_GAS-RULES_GRULE15.pdf.
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Natural Gas Plan Review: Total costs are based on TRC’s 2019 reach code analysis for Palo Alto (TRC, 2018 ). The
cost for the 5-story prototype is apportioned between the residential and nonresidential spaces in the building in the
same way as was done for the service extension costs.
Table 9. IOU Natural Gas Infrastructure Cost Savings for All-Electric Building
Item 3-Story 5-Story
Service Extension $6,750 $5,695
Meter
No In-Unit Gas
(Gas DHW only) $3,600 $3,600
In-Unit Gas $25,200 $56,400
Plan Review $2,316 $1,954
Table 10. Multifamily IOU Total Natural Gas Infrastructure Costs
Prototype Scenario Total
Building
Per Dwelling
Unit
3-Story No In-Unit Gas $12,666 $352
In-Unit Gas $34,266 $952
5-Story No In-Unit Gas $11,248 $128
In-Unit Gas $64,048 $728
CPAU provides gas service to its customers and therefore separate costs were evaluated based on CPAU gas service
connection fees.8 Table 11 presents the breakdown of gas infrastructure costs used in this analysis for CPAU. The
same approach to apportioning the total building costs to the residential spaces as described in the IOU section was
applied here for the service extension and plan review costs for the 5-story prototype. Meter costs were based on
$1,772 for an 800 cubic foot per hour commercial meter for the central water heating system.
Table 11. Multifamily CPAU Total Natural Gas Infrastructure Costs
Item 3-Story 5-Story
Service Extension $5,892 $4,971
Meter $1,772 $1,772
Plan Review $2,557 $2,157
3.3 Measure Packages
The Reach Codes Team evaluated three packages for mixed fuel homes and five packages for all-electric homes for
each prototype and climate zone, as described below.
1. All-Electric Prescriptive Code: This package meets all the prescriptive requirements of the 2022 Energy Code.
2. All-Electric Prescriptive Code + PV: Using the code minimum package as a starting point, PV capacity was
added to offset 100 percent of the estimated annual electricity use.
3. Mixed Fuel Efficiency Only: This package uses only efficiency measures that do not trigger federal preemption
including envelope and duct distribution efficiency measures.
8 CPAU Schedule G-5 effective 09-01-2019: https://www.cityofpaloalto.org/files/assets/public/utilities/utilities-
engineering/general-specifications/gas-service-connection-fees.pdf
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4. Mixed Fuel Efficiency + PV + Battery: Using the Efficiency Package as a starting point, PV capacity was added
to offset 100 percent of the estimated annual electricity use. A battery system was also added. This package
only applies to the 3-story prototype. The 5-story prototype includes a battery system in the baseline per the
2022 prescriptive requirements.
5. Mixed Fuel Efficiency + PV: Using the Efficiency Package as a starting point, PV capacity was added to offset
100 percent of the estimated annual electricity use. This package only applies to the 5-story prototype.
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4 Results
Cost-effectiveness results are presented per prototype and measure packages described in Section 3.3. The TDV and
On-Bill based cost-effectiveness results are presented in terms of B/C ratio and NPV. Energy savings, compliance
margin, utility bill savings, and incremental costs are also shown.
In the following figures, green highlighting indicates that the case is cost-effective with a B/C ratio greater than or equal
to 1 and a NPV greater than or equal to 0. Red highlighting indicates the case is not cost-effective.
Compliance margins are presented as percentages both for the efficiency TDV and the source energy metrics. A
compliance margin that is equal to or greater than 0 indicates the case is code compliant.
4.1 All-Electric Prescriptive Code
Table 12 and Table 13 shows results for the multifamily all-electric prescriptive code case compared to the 2022
baseline. For both prototypes this scenario is cost-effective based on TDV in all climate zones. This scenario is only
On-Bill cost-effective in a few climate zones. The 3-story all-electric case is cost-effective On-Bill in Climate Zones 1
through 3, 4 in CPAU territory, 12 in SMUD territory, and 16. The 5-story all-electric case is cost-effective On-Bill in
Climate Zones 1, 4, 12 in SMUD territory, and 16.
In most cases there is a small net increase in utility cost in the first year.
There is an incremental cost for the central heat pump water heater ranging from $361 to $697 per dwelling unit.
The all-electric packages applied to the 3-story prototype in Climate Zone 16 and the 5-story prototype in Climate
Zones 1 and 16 incorporate both gas to electric water heating and gas to electric space heating measures. In these
cases, there are significant cost savings due to the avoided first costs of installing a gas furnace as compared to a heat
pump. As a result, these cases are On-Bill cost-effective.
These results reflect a CO2 refrigerant based central heat pump water heating system. The 5-story prototype was also
evaluated with a R-134a refrigerant based central heat pump water heater and these results are shown in Appendix
7.5 Central Heat Pump Water Heater Comparison.
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Table 12. 3-Story Cost-Effectiveness Results per Dwelling Unit: All-Electric Prescriptive Code
Climate
Zone
Electric
/Gas Utility
Efficiency
TDV
Comp
Margin
Source
Comp
Margin
Annual
Elec
Savings
(kWh)
Annual
Gas
Savings
(therms)
Utility Cost Savings Incremental Cost On-Bill TDV
First
Year
Lifecycle
(2022$)
First
Year
Lifecycle
(2022$)
B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 26% 15% -904 135 ($19) $1,676 $97 $429 3.9 $1,247 >1 $4,158
CZ02 PGE 20% 11% -801 115 ($30) $1,061 $697 $1,029 1.0 $32 9.9 $2,998
CZ03 PGE 21% 10% -789 115 ($26) $1,148 $697 $1,029 1.1 $119 9.9 $2,990
CZ04 PGE 18% 9% -759 109 ($31) $922 $697 $1,029 0.9 ($108) 9.2 $2,767
CZ04 CPAU 18% 9% -759 109 $233 $8,191 $765 $1,097 7.5 $7,094 7.7 $2,700
CZ05 PGE 23% 9% -789 112 ($30) $1,009 $697 $1,029 0.98 ($21) 9.3 $2,782
CZ05 PGE/SCG 23% 9% -789 112 ($79) ($515) $697 $1,029 0.0 ($1,545) 9.3 $2,782
CZ06 SCE/SCG 18% 7% -709 100 ($61) ($226) $697 $1,029 0.0 ($1,255) 8.6 $2,551
CZ07 SDGE 20% 8% -704 102 ($69) ($427) $697 $1,029 0.0 ($1,456) 9.1 $2,712
CZ08 SCE/SCG 13% 6% -689 96 ($61) ($302) $697 $1,029 0.0 ($1,331) 8.2 $2,432
CZ09 SCE 13% 5% -698 96 ($64) ($351) $697 $1,029 0.0 ($1,380) 8.0 $2,363
CZ10 SCE/SCG 14% 7% -701 83 ($88) ($1,109) $446 $649 0.0 ($1,758) >1 $1,959
CZ10 SDGE 14% 7% -701 83 ($112) ($1,803) $446 $649 0.0 ($2,452) >1 $1,959
CZ11 PGE 14% 10% -740 91 ($64) ($177) $446 $649 0.0 ($826) >1 $2,212
CZ12 PGE 17% 11% -755 94 ($62) ($70) $446 $649 0.0 ($719) >1 $2,297
CZ12 SMUD/PGE 17% 11% -755 94 $68 $2,942 $446 $649 4.5 $2,293 >1 $2,297
CZ13 PGE 13% 9% -717 86 ($65) ($291) $446 $649 0.0 ($940) >1 $2,050
CZ14 SCE/SCG 13% 7% -748 83 ($102) ($1,413) $446 $649 0.0 ($2,063) >1 $1,759
CZ14 SDGE 13% 7% -748 83 ($128) ($2,191) $446 $649 0.0 ($2,841) >1 $1,759
CZ15 SCE/SCG 5% 2% -607 64 ($89) ($1,403) $446 $649 0.0 ($2,053) >1 $1,305
CZ16 PG&E 24% 29% -1,928 185 ($178) ($1,066) ($4,045) ($2,983) 2.8 $1,917 >1 $4,352
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Table 13. 5-Story Cost-Effectiveness Results per Dwelling Unit: All-Electric Prescriptive Code
Climate
Zone
Electric
/Gas Utility
Efficiency
TDV
Comp
Margin
Source
Comp
Margin
Annual
Elec
Savings
(kWh)
Annual
Gas
Savings
(therms)
Utility Cost
Savings Incremental Cost On-Bill TDV
First
Year
Lifecycle
(2022$)
First
Year
Lifecycle
(2022$)
B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 14% 9% -1,146 147 ($49) $1,209 ($4,639) ($5,788) >1 $6,998 >1 $9,816
CZ02 PGE 9% 6% -888 120 ($45) $809 $608 $1,185 0.7 ($375) 3.0 $2,270
CZ03 PGE 11% 7% -874 120 ($46) $778 $608 $1,185 0.7 ($407) 3.1 $2,421
CZ04 PGE 9% 6% -824 113 $18 $2,130 $608 $1,185 1.8 $945 3.1 $2,393
CZ04 CPAU 9% 6% -824 113 $230 $8,205 $635 $1,211 6.8 $6,994 3.0 $2,367
CZ05 PGE 12% 6% -871 117 ($47) $706 $608 $1,185 0.6 ($479) 2.8 $2,065
CZ05 PGE/SCG 12% 6% -871 117 ($99) ($919) $608 $1,185 0.0 ($2,103) 2.8 $2,065
CZ06 SCE/SCG 9% 5% -739 104 ($10) $986 $608 $1,185 0.8 ($199) 2.9 $2,183
CZ07 SDGE 11% 6% -735 106 ($74) ($500) $608 $1,185 0.0 ($1,685) 2.9 $2,215
CZ08 SCE/SCG 8% 4% -710 100 ($79) ($644) $608 $1,185 0.0 ($1,829) 3.0 $2,259
CZ09 SCE 7% 4% -725 100 ($53) ($51) $608 $1,185 0.0 ($1,236) 3.0 $2,274
CZ10 SCE/SCG 7% 4% -729 84 ($111) ($1,615) $361 $831 0.0 ($2,445) 2.7 $1,374
CZ10 SDGE 7% 4% -729 84 ($137) ($2,404) $361 $831 0.0 ($3,234) 2.7 $1,374
CZ11 PGE 8% 5% -790 92 ($86) ($663) $361 $831 0.0 ($1,494) 3.1 $1,656
CZ12 PGE 9% 6% -809 96 ($83) ($527) $361 $831 0.0 ($1,358) 3.0 $1,620
CZ12 SMUD/PGE 9% 6% -809 96 $62 $2,831 $361 $831 3.4 $2,000 3.0 $1,620
CZ13 PGE 7% 5% -754 88 ($83) ($686) $361 $831 0.0 ($1,517) 3.0 $1,570
CZ14 SCE/SCG 6% 3% -803 84 ($131) ($2,085) $361 $831 0.0 ($2,916) 2.2 $928
CZ14 SDGE 6% 3% -803 84 ($165) ($3,106) $361 $831 0.0 ($3,937) 2.2 $928
CZ15 SCE/SCG 3% 1% -602 65 ($105) ($1,775) $361 $831 0.0 ($2,606) 1.9 $695
CZ16 PG&E 9% 11% -1,388 142 ($127) ($675) ($4,886) ($6,142) 9.1 $5,467 >1 $6,704
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4.2 All-Electric Plus PV
Table 14 and Table 15 present cost-effectiveness results for the all-electric plus PV packages for the 3-story and 5-story prototypes, respectively. All cases are
cost-effective both On-Bill and based on TDV.
Table 14. 3-Story Cost-Effectiveness Results per Dwelling Unit: All-Electric 100% PV
Climate
Zone
Electric
/Gas Utility
Efficiency
TDV
Comp
Margin
Source
Comp
Margin
Annual
Elec
Savings
(kWh)
Annual
Gas
Savings
(therms)
Utility Cost
Savings Incremental Cost On-Bill TDV
First
Year
Lifecycle
(2022$)
First
Year
Lifecycle
(2022$)
B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 26% 24% 2,127 135 $782 $20,242 $3,638 $5,034 4.0 $15,208 3.2 $9,448
CZ02 PGE 20% 20% 1,835 115 $653 $16,910 $3,294 $4,406 3.8 $12,504 3.3 $8,632
CZ03 PGE 21% 20% 1,711 115 $614 $15,998 $3,076 $4,123 3.9 $11,875 3.4 $8,209
CZ04 PGE 18% 18% 1,558 109 $559 $14,587 $2,841 $3,818 3.8 $10,770 3.6 $8,230
CZ04 CPAU 18% 18% 1,558 109 $489 $14,138 $2,909 $3,886 3.6 $10,253 3.6 $8,162
CZ05 PGE 23% 20% 1,604 112 $579 $15,137 $2,826 $3,798 4.0 $11,338 3.6 $8,026
CZ05 PGE/SCG 23% 20% 1,604 112 $531 $13,613 $2,826 $3,798 3.6 $9,814 3.6 $8,026
CZ06 SCE/SCG 18% 17% 1,207 100 $378 $9,795 $2,364 $3,197 3.1 $6,598 3.8 $7,092
CZ07 SDGE 20% 21% 1,528 102 $723 $19,318 $2,777 $3,734 5.2 $15,584 3.5 $7,623
CZ08 SCE/SCG 13% 17% 1,393 96 $426 $10,842 $2,569 $3,464 3.1 $7,378 3.9 $7,908
CZ09 SCE 13% 15% 1,204 96 $379 $9,756 $2,335 $3,160 3.1 $6,596 3.9 $7,158
CZ10 SCE/SCG 14% 18% 1,381 83 $404 $10,130 $2,237 $2,978 3.4 $7,152 4.1 $7,031
CZ10 SDGE 14% 18% 1,381 83 $621 $16,493 $2,237 $2,978 5.5 $13,514 4.1 $7,031
CZ11 PGE 14% 19% 1,843 91 $625 $15,782 $2,940 $3,893 4.1 $11,889 3.4 $7,748
CZ12 PGE 17% 19% 1,704 94 $579 $14,777 $2,756 $3,654 4.0 $11,124 3.6 $7,607
CZ12 SMUD/PGE 17% 19% 1,704 94 $399 $10,615 $2,756 $3,654 2.9 $6,961 3.6 $7,607
CZ13 PGE 13% 17% 1,572 86 $544 $13,822 $2,567 $3,408 4.1 $10,415 3.6 $7,148
CZ14 SCE/SCG 13% 18% 1,572 83 $449 $11,152 $2,300 $3,060 3.6 $8,092 4.2 $7,668
CZ14 SDGE 13% 18% 1,572 83 $688 $18,158 $2,300 $3,060 5.9 $15,098 4.2 $7,668
CZ15 SCE/SCG 5% 11% 1,163 64 $330 $8,164 $1,966 $2,626 3.1 $5,539 3.9 $5,567
CZ16 PG&E 24% 38% 1,371 185 $700 $19,307 ($1,064) $894 21.6 $18,412 58.9 $11,596
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Table 15. 5-Story Cost-Effectiveness Results per Dwelling Unit: All-Electric 100% PV
Climate
Zone
Electric
/Gas Utility
Efficiency
TDV
Comp
Margin
Source
Comp
Margin
Annual
Elec
Savings
(kWh)
Annual
Gas
Savings
(therms)
Utility Cost
Savings Incremental Cost On-Bill TDV
First
Year
Lifecycle
(2022$)
First
Year
Lifecycle
(2022$)
B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 14% 21% 1,437 147 $629 $16,919 ($1,574) ($1,803) >1 $18,721 >1 $18,222
CZ02 PGE 9% 14% 428 120 $262 $7,918 $1,930 $2,904 2.7 $5,015 4.0 $8,679
CZ03 PGE 11% 16% 682 120 $327 $9,417 $2,121 $3,152 3.0 $6,265 4.0 $9,285
CZ04 PGE 9% 13% 92 113 $207 $6,524 $1,476 $2,313 2.8 $4,211 4.1 $7,054
CZ04 CPAU 9% 13% 92 113 $337 $10,667 $1,502 $2,340 4.6 $8,327 4.0 $7,027
CZ05 PGE 12% 16% 451 117 $259 $7,806 $1,815 $2,754 2.8 $5,052 4.0 $8,096
CZ05 PGE/SCG 12% 16% 451 117 $207 $6,182 $1,815 $2,754 2.2 $3,427 4.0 $8,096
CZ06 SCE/SCG 9% 12% -163 104 $98 $3,449 $1,127 $1,859 1.9 $1,590 3.8 $5,035
CZ07 SDGE 11% 15% 74 106 $192 $6,131 $1,387 $2,198 2.8 $3,934 3.9 $6,204
CZ08 SCE/SCG 8% 14% 265 100 $154 $4,666 $1,516 $2,365 2.0 $2,301 4.0 $7,053
CZ09 SCE 7% 12% 60 100 $122 $3,930 $1,307 $2,093 1.9 $1,837 3.7 $5,636
CZ10 SCE/SCG 7% 13% 289 84 $131 $3,912 $1,266 $2,007 1.9 $1,905 3.9 $5,749
CZ10 SDGE 7% 13% 289 84 $238 $6,951 $1,266 $2,007 3.5 $4,945 3.9 $5,749
CZ11 PGE 8% 17% 1,091 92 $417 $10,990 $2,226 $3,256 3.4 $7,734 4.2 $10,472
CZ12 PGE 9% 16% 594 96 $263 $7,487 $1,712 $2,587 2.9 $4,901 4.3 $8,544
CZ12 SMUD/PGE 9% 16% 594 96 $260 $7,419 $1,712 $2,587 2.9 $4,889 4.3 $8,544
CZ13 PGE 7% 17% 1,036 88 $398 $10,479 $2,064 $3,045 3.4 $7,434 4.2 $9,715
CZ14 SCE/SCG 6% 11% 182 84 $102 $3,250 $1,170 $1,883 1.7 $1,368 4.0 $5,515
CZ14 SDGE 6% 11% 182 84 $194 $5,858 $1,170 $1,883 3.1 $3,975 4.0 $5,515
CZ15 SCE/SCG 3% 10% 387 65 $153 $4,119 $1,238 $1,971 2.1 $2,148 3.6 $4,998
CZ16 PG&E 9% 23% 1,007 142 $501 $13,864 ($2,682) ($3,275) >1 $17,139 >1 $16,140
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4.3 Mixed Fuel Efficiency
Table 16 and Table 17 show results for the Mixed Fuel Efficiency packages. The packages are cost-effective based on at least one of the two metrics in Climate
Zones 1, 2, 4, and 8 through 16 for the 3-story prototype and in Climate Zones 2, 4, 6, and 8 through 15 for the 5-story prototype. In all cases the NPV values,
whether negative or positive, are small. The compliance impacts are also small.
A summary of measures included in each package is provided in Appendix 7.6 Summary of Measures by Package.
Table 16. 3-Story Cost-Effectiveness Results per Dwelling Unit: Mixed Fuel Efficiency
Climate
Zone
Electric
/Gas Utility
Efficiency
TDV
Comp
Margin
Source
Comp
Margin
Annual
Elec
Savings
(kWh)
Annual
Gas
Savings
(therms)
Utility Cost
Savings Incremental Cost On-Bill TDV
First
Year
Lifecycle
(2022$)
First
Year
Lifecycle
(2022$)
B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 1% 1% 41 0 $12 $273 $176 $176 1.6 $98 1.2 $38
CZ02 PGE 1% 0% 24 0 $7 $162 $132 $132 1.2 $30 1.5 $62
CZ03 PGE 1% 0% 17 0 $5 $111 $132 $132 0.8 ($21) 0.8 ($27)
CZ04 PGE 1% 0% 21 0 $6 $141 $132 $132 1.1 $9 1.3 $46
CZ04 CPAU 1% 0% 21 0 $3 $74 $132 $132 0.6 ($58) 1.3 $46
CZ05 PGE 1% 0% 19 0 $5 $123 $132 $132 0.9 ($9) 0.8 ($32)
CZ05 PGE/SCG 1% 0% 19 0 $5 $123 $132 $132 0.9 ($9) 0.8 ($32)
CZ06 SCE/SCG 1% 0% 9 0 $2 $56 $132 $132 0.4 ($75) 0.7 ($44)
CZ07 SDGE 0% 0% 7 0 $3 $72 $132 $132 0.5 ($60) 0.4 ($81)
CZ08 SCE/SCG 1% 0% 20 0 $6 $140 $132 $132 1.1 $9 1.5 $59
CZ09 SCE 1% 0% 28 0 $8 $192 $146 $156 1.2 $36 1.6 $88
CZ10 SCE/SCG 3% 1% 65 0 $20 $447 $190 $199 2.2 $247 2.4 $277
CZ10 SDGE 3% 1% 65 0 $27 $683 $190 $199 3.4 $484 2.4 $277
CZ11 PGE 3% 1% 91 0 $30 $699 $190 $199 3.5 $499 3.5 $489
CZ12 PGE 2% 0% 98 0 $33 $766 $381 $514 1.5 $252 1.5 $273
CZ12 SMUD/PGE 2% 0% 98 0 $17 $396 $381 $514 0.8 ($118) 1.5 $273
CZ13 PGE 4% 1% 99 0 $33 $765 $190 $199 3.8 $566 3.9 $574
CZ14 SCE/SCG 3% 1% 88 0 $26 $585 $190 $199 2.9 $385 3.1 $427
CZ14 SDGE 3% 1% 88 0 $36 $886 $190 $199 4.4 $686 3.1 $427
CZ15 SCE/SCG 5% 2% 182 0 $54 $1,226 $190 $199 6.1 $1,026 5.8 $957
CZ16 PG&E 5% 4% 16 12 $34 $1,012 $712 $712 1.4 $300 1.3 $184
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Table 17. 5-Story Cost-Effectiveness Results per Dwelling Unit: Mixed Fuel Efficiency
4.4 Mixed Fuel Plus PV (Plus Battery for the 3-Story Prototype)
Table 18 presents the Mixed Fuel Efficiency + PV + Battery package for the 3-story prototype. The battery system is a 100kWh battery. This scenario is cost-
effective for all climate zones and under both metrics except for On-Bill in Climate Zone 4 in CPAU territory. Table 19 presents the Mixed Fuel Efficiency + PV
package for the 5-story prototype. This package is cost-effective under TDV in all climate zones and cost-effective On-Bill everywhere except in Climate Zones 6
and 7. In the cases where it is not cost-effective, it is very close to being so with small negative NPV. In Climate Zone 6 in the 5-story prototype there is no
upgrade to the PV system capacity as the prescriptive PV system already offset all of the estimated electricity use.
Climate
Zone
Electric
/Gas Utility
Efficiency
TDV
Comp
Margin
Source
Comp
Margin
Annual
Elec
Savings
(kWh)
Annual
Gas
Savings
(therms)
Utility Cost
Savings Incremental Cost On-Bill TDV
First
Year
Lifecycle
(2022$)
First
Year
Lifecycle
(2022$)
B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 0% 0% 5 0 $2 $39 $176 $176 0.2 ($137) 0.2 ($136)
CZ02 PGE 1% 0% 11 0 $2 $38 $132 $132 0.3 ($94) 1.9 $118
CZ03 PGE 0% 0% 7 0 $2 $46 $132 $132 0.3 ($86) 0.8 ($23)
CZ04 PGE 1% 0% 12 0 $2 $40 $132 $132 0.3 ($92) 1.9 $114
CZ04 CPAU 1% 0% 12 0 $2 $39 $132 $132 0.3 ($93) 1.9 $114
CZ05 PGE 0% 0% 6 0 $1 $17 $132 $132 0.1 ($114) 0.4 ($73)
CZ05 PGE/SCG 0% 0% 6 0 $1 $17 $132 $132 0.1 ($114) 0.4 ($73)
CZ06 SCE/SCG 0% 0% 12 0 $2 $51 $132 $132 0.4 ($81) 1.4 $49
CZ07 SDGE 0% 0% 10 0 $0 $0 $132 $132 0.0 ($132) 0.9 ($7)
CZ08 SCE/SCG 1% 0% 24 0 $8 $184 $132 $132 1.4 $53 2.2 $152
CZ09 SCE 1% 0% 28 0 $4 $96 $142 $149 0.6 ($52) 2.1 $163
CZ10 SCE/SCG 2% 1% 66 0 $21 $491 $186 $192 2.6 $298 3.2 $425
CZ10 SDGE 2% 1% 66 0 $30 $751 $186 $192 3.9 $558 3.2 $425
CZ11 PGE 2% 1% 83 0 $29 $665 $186 $192 3.5 $473 4.2 $621
CZ12 PGE 2% 0% 84 0 $29 $681 $321 $414 1.6 $267 2.3 $546
CZ12 SMUD/PGE 2% 0% 84 0 $16 $372 $321 $414 0.9 ($42) 2.3 $546
CZ13 PGE 2% 1% 95 0 $33 $765 $186 $192 4.0 $573 4.9 $742
CZ14 SCE/SCG 2% 1% 75 0 $11 $246 $186 $192 1.3 $54 3.9 $561
CZ14 SDGE 2% 1% 75 0 $34 $847 $186 $192 4.4 $654 3.9 $561
CZ15 SCE/SCG 3% 2% 172 0 $55 $1,257 $186 $192 6.5 $1,065 7.3 $1,212
CZ16 PG&E 2% 2% 40 4 $23 $616 $665 $665 0.9 ($49) 0.999 ($0)
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Table 18. 3-Story Cost-Effectiveness Results per Dwelling Unit: Mixed Fuel Efficiency + PV + Battery
Climate
Zone
Electric
/Gas Utility
Efficiency
TDV
Comp
Margin
Source
Comp
Margin
Annual
Elec
Savings
(kWh)
Annual
Gas
Savings
(therms)
Utility Cost
Savings Incremental Cost On-Bill TDV
First
Year
Lifecycle
(2022$)
First
Year
Lifecycle
(2022$)
B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 1% 16% 2,068 0 $543 $12,588 $4,603 $6,917 1.8 $5,671 1.5 $3,724
CZ02 PGE 1% 16% 1,757 0 $462 $10,718 $3,881 $5,990 1.8 $4,728 1.6 $3,820
CZ03 PGE 1% 17% 1,624 0 $423 $9,797 $3,700 $5,754 1.7 $4,043 1.5 $3,157
CZ04 PGE 1% 17% 1,476 0 $383 $8,878 $3,518 $5,518 1.6 $3,360 1.6 $3,067
CZ04 CPAU 1% 17% 1,476 0 $171 $3,967 $3,518 $5,518 0.7 ($1,551) 1.6 $3,067
CZ05 PGE 1% 18% 1,520 0 $393 $9,107 $3,503 $5,498 1.7 $3,609 1.6 $3,526
CZ05 PGE/SCG 1% 18% 1,520 0 $393 $9,107 $3,503 $5,498 1.7 $3,609 1.6 $3,526
CZ06 SCE/SCG 1% 18% 1,112 0 $336 $7,677 $3,127 $5,009 1.5 $2,668 1.4 $1,917
CZ07 SDGE 0% 20% 1,431 0 $550 $13,713 $3,498 $5,493 2.5 $8,220 1.6 $3,159
CZ08 SCE/SCG 1% 18% 1,311 0 $413 $9,427 $3,328 $5,270 1.8 $4,156 1.4 $2,277
CZ09 SCE 1% 17% 1,129 0 $367 $8,375 $3,129 $5,017 1.7 $3,359 1.4 $1,937
CZ10 SCE/SCG 3% 19% 1,342 0 $420 $9,584 $3,321 $5,254 1.8 $4,331 1.5 $2,588
CZ10 SDGE 3% 19% 1,342 0 $533 $13,303 $3,321 $5,254 2.5 $8,049 1.5 $2,588
CZ11 PGE 3% 17% 1,833 0 $500 $11,587 $3,914 $6,025 1.9 $5,562 1.6 $3,852
CZ12 PGE 2% 17% 1,701 0 $442 $10,239 $3,926 $6,105 1.7 $4,133 1.6 $3,583
CZ12 SMUD/PGE 2% 17% 1,701 0 $285 $6,609 $3,926 $6,105 1.1 $503 1.6 $3,583
CZ13 PGE 4% 17% 1,568 0 $431 $9,983 $3,594 $5,609 1.8 $4,374 1.7 $3,944
CZ14 SCE/SCG 3% 19% 1,556 0 $477 $10,886 $3,388 $5,341 2.0 $5,545 1.6 $3,434
CZ14 SDGE 3% 19% 1,556 0 $607 $15,155 $3,388 $5,341 2.8 $9,815 1.6 $3,434
CZ15 SCE/SCG 5% 19% 1,241 0 $421 $9,616 $3,136 $5,013 1.9 $4,603 1.6 $3,076
CZ16 PG&E 5% 17% 1,286 12 $357 $8,508 $3,894 $5,833 1.5 $2,674 1.6 $3,219
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Table 19. 5-Story Cost-Effectiveness Results per Dwelling Unit: Mixed Fuel Efficiency + PV
Climate
Zone
Electric
/Gas Utility
Efficiency
TDV
Comp
Margin
Source
Comp
Margin
Annual
Elec
Savings
(kWh)
Annual
Gas
Savings
(therms)
Utility Cost
Savings Incremental Cost On-Bill TDV
First
Year
Lifecycle
(2022$)
First
Year
Lifecycle
(2022$)
B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 0% 5% 1,446 0 $341 $7,917 $1,889 $2,403 3.3 $5,514 3.0 $4,757
CZ02 PGE 1% 2% 444 0 $55 $1,275 $567 $697 1.8 $578 4.4 $2,365
CZ03 PGE 0% 4% 693 0 $119 $2,766 $801 $1,002 2.8 $1,764 4.4 $3,423
CZ04 PGE 1% 1% 112 0 $14 $324 $226 $254 1.3 $69 3.5 $632
CZ04 CPAU 1% 1% 112 0 $13 $307 $226 $254 1.2 $53 3.5 $632
CZ05 PGE 0% 3% 464 0 $56 $1,310 $550 $676 1.9 $634 4.2 $2,165
CZ05 PGE/SCG 0% 3% 464 0 $56 $1,310 $550 $676 1.9 $634 4.2 $2,165
CZ06 SCE/SCG 0% 0% 12 0 $2 $51 $132 $132 0.4 ($81) 1.4 $49
CZ07 SDGE 0% 1% 95 0 $0 $0 $212 $237 0.0 ($237) 2.8 $423
CZ08 SCE/SCG 1% 3% 299 0 $42 $968 $388 $465 2.1 $504 4.3 $1,527
CZ09 SCE 1% 1% 99 0 $12 $284 $204 $230 1.2 $54 3.0 $465
CZ10 SCE/SCG 2% 3% 364 0 $57 $1,296 $450 $536 2.4 $759 4.2 $1,720
CZ10 SDGE 2% 3% 364 0 $103 $2,566 $450 $536 4.8 $2,030 4.2 $1,720
CZ11 PGE 2% 7% 1,178 0 $281 $6,521 $1,276 $1,610 4.1 $4,911 4.8 $6,162
CZ12 PGE 2% 4% 683 0 $120 $2,791 $898 $1,164 2.4 $1,627 4.2 $3,716
CZ12 SMUD/PGE 2% 4% 683 0 $102 $2,362 $898 $1,164 2.0 $1,198 4.2 $3,716
CZ13 PGE 2% 7% 1,137 0 $274 $6,347 $1,179 $1,484 4.3 $4,863 4.8 $5,599
CZ14 SCE/SCG 2% 2% 266 0 $33 $748 $342 $395 1.9 $353 4.7 $1,447
CZ14 SDGE 2% 2% 266 0 $62 $1,554 $342 $395 3.9 $1,158 4.7 $1,447
CZ15 SCE/SCG 3% 5% 567 0 $125 $2,851 $535 $646 4.4 $2,204 5.6 $2,994
CZ16 PG&E 2% 6% 1,051 4 $237 $5,569 $1,601 $1,883 3.0 $3,686 3.1 $4,011
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4.5 CARE Rate Comparison
Table 20 presents a comparison of On-Bill cost-effectiveness results for CARE tariffs relative to standard tariffs for the
all-electric prescriptive code case. The CARE rates apply to the apartment meters only and don’t impact the central
water heating utility costs. Applying the CARE rates lowers both electric and gas utility bills for the consumer and the
net impact for an all-electric building in most climate zones is lower overall bills and improved cost-effectiveness
relative to the standard tariffs. Although not presented here, the all-electric + PV packages are all still On-Bill cost-
effective using the CARE tariffs.
Table 20. On-Bill IOU Cost-Effectiveness Comparison with CARE Tariffs, Results per
Dwelling Unit: All-Electric Prescriptive Code
Climate
Zone
Electric
/Gas Utility
3-Story 5-Story
Standard CARE Standard CARE
B/C Ratio NPV B/C Ratio NPV B/C Ratio NPV B/C Ratio NPV
CZ01 PGE 3.9 $1,247 9.5 $3,637 >1 $6,998 >1 $10,045
CZ02 PGE 1.0 $32 3.1 $2,139 0.7 ($375) 2.5 $1,831
CZ03 PGE 1.1 $119 3.1 $2,187 0.7 ($407) 2.6 $1,901
CZ04 PGE 0.9 ($108) 2.8 $1,884 1.8 $945 2.9 $2,218
CZ05 PGE 0.98 ($21) 3.0 $2,041 0.6 ($479) 2.5 $1,773
CZ05 PGE/SCG 0.0 ($1,545) 1.5 $517 0.0 ($2,103) 1.1 $148
CZ06 SCE/SCG 0.0 ($1,255) 0.9 ($57) 0.8 ($199) 2.1 $1,349
CZ07 SDGE 0.0 ($1,456) 1.8 $856 0.0 ($1,685) 1.3 $343
CZ08 SCE/SCG 0.0 ($1,331) 0.8 ($165) 0.0 ($1,829) 1.2 $271
CZ09 SCE 0.0 ($1,380) 0.8 ($204) 0.0 ($1,236) 1.6 $750
CZ10 SCE/SCG 0.0 ($1,758) 0.1 ($574) 0.0 ($2,445) 0.5 ($447)
CZ10 SDGE 0.0 ($2,452) 0.8 ($162) 0.0 ($3,234) 0.0 ($1,590)
CZ11 PGE 0.0 ($826) 2.7 $1,119 0.0 ($1,494) 1.7 $616
CZ12 PGE 0.0 ($719) 2.9 $1,263 0.0 ($1,358) 2.0 $793
CZ13 PGE 0.0 ($940) 2.4 $936 0.0 ($1,517) 1.6 $491
CZ14 SCE/SCG 0.0 ($2,063) 0.0 ($803) 0.0 ($2,916) 0.3 ($613)
CZ14 SDGE 0.0 ($2,841) 0.0 ($3,407) 0.0 ($3,937) 1.1 $61
CZ15 SCE/SCG 0.0 ($2,053) 0.0 ($1,036) 0.0 ($2,606) 0.0 ($1,452)
CZ16 PG&E 2.8 $1,917 >1 $5,527 9.1 $5,467 >1 $8,557
Error! Not a valid bookmark self-reference. presents the comparison for the mixed fuel efficiency and PV packages.
Generally, the opposite trend occurs here for the mixed fuel packages where the CARE rate lowers utility cost savings
and the benefit-to-cost ratios decline.
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Table 21. On-Bill IOU Cost-Effectiveness Comparison with CARE Tariffs, Results per
Dwelling Unit: Mixed Fuel Packages
Climate
Zone
Electric
/Gas Utility
3-Story (Efficiency + PV + Battery) 5-Story (Efficiency + PV)
Standard CARE Standard CARE
B/C Ratio NPV B/C Ratio NPV B/C Ratio NPV B/C Ratio NPV
CZ01 PGE 1.8 $5,671 1.2 $1,113 3.3 $5,514 2.2 $2,765
CZ02 PGE 1.8 $4,728 1.2 $907 1.8 $578 1.5 $337
CZ03 PGE 1.7 $4,043 1.1 $579 2.8 $1,764 2.0 $1,028
CZ04 PGE 1.6 $3,360 1.0 $259 1.3 $69 0.8 ($44)
CZ05 PGE 1.7 $3,609 1.1 $414 1.9 $634 1.7 $442
CZ05 PGE/SCG 1.7 $3,609 1.1 $414 1.9 $634 1.7 $442
CZ06 SCE/SCG 1.5 $2,668 0.9 ($515) 0.4 ($81) 0.3 ($92)
CZ07 SDGE 2.5 $8,220 1.7 $4,106 0.0 ($237) 0.0 ($237)
CZ08 SCE/SCG 1.8 $4,156 1.1 $446 2.1 $504 1.3 $137
CZ09 SCE 1.7 $3,359 0.99 ($26) 1.2 $54 0.9 ($28)
CZ10 SCE/SCG 1.8 $4,331 1.1 $577 2.4 $759 1.3 $180
CZ10 SDGE 2.5 $8,049 1.8 $4,180 4.8 $2,030 0.0 ($536)
CZ11 PGE 1.9 $5,562 1.2 $1,435 4.1 $4,911 2.7 $2,744
CZ12 PGE 1.7 $4,133 1.1 $517 2.4 $1,627 1.8 $905
CZ13 PGE 1.8 $4,374 1.2 $883 4.3 $4,863 2.9 $2,777
CZ14 SCE/SCG 2.0 $5,545 1.3 $1,395 1.9 $353 1.3 $136
CZ14 SDGE 2.8 $9,815 1.4 $2,292 3.9 $1,158 0.0 ($395)
CZ15 SCE/SCG 1.9 $4,603 1.2 $887 4.4 $2,204 1.9 $586
CZ16 PG&E 1.5 $2,674 0.97 ($162) 3.0 $3,686 2.0 $1,908
4.6 Greenhouse Gas Reductions
Figure 1 and Figure 2 compare greenhouse gas reductions across all the packages for the multifamily 3-story and 5-
story prototypes, respectively. Savings represent average annual savings per dwelling unit over the 30-year lifetime of
the analysis. Electrification of gas uses represents the greatest greenhouse gas reductions, followed by PV.
Greenhouse gas reductions are greatest for the all-electric + PV package.
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Figure 1. 3-Story greenhouse gas reductions (metric tons) per dwelling unit
Figure 2. 5-Story greenhouse gas savings (metric tons) per dwelling unit
0.0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1.0
CZ 01 CZ 02 CZ 03 CZ 04 CZ 05 CZ 06 CZ 07 CZ 08 CZ 09 CZ 10 CZ 11 CZ 12 CZ 13 CZ 14 CZ 15 CZ 16Greenhouse Gas Reduc�ons (metric tons)Mixed Fuel Efficiency
Mixed Fuel Efficiency + PV + Ba�ery
All-Electric Code Minimum
All-Electric + PV
0.0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1.0
CZ 01 CZ 02 CZ 03 CZ 04 CZ 05 CZ 06 CZ 07 CZ 08 CZ 09 CZ 10 CZ 11 CZ 12 CZ 13 CZ 14 CZ 15 CZ 16Greenhouse Gas Reduc�ons (metric tons)Mixed Fuel EfficiencyMixed Fuel Efficiency + PV
All-Electric Code Minimum
All-Electric + PV
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
5 Summary
The Reach Codes Team identified packages of electrification and energy efficiency measures as well as packages
combining these measures with solar PV generation and battery storage, simulated them using building modeling
software, and gathered costs to determine the cost-effectiveness of multiple scenarios. The Reach Codes Team
coordinated with multiple utilities, cities, and building community experts to develop a set of assumptions considered
reasonable in the current market. Changing assumptions, such as the period of analysis, measure selection, cost
assumptions, energy escalation rates, or utility tariffs are likely to change results.
Table 22 summarizes results for each prototype and depicts the efficiency TDV compliance margins achieved for each
climate zone and package. Because local reach codes must both exceed the Energy Commission performance budget
(i.e., have a positive compliance margin) and be cost-effective, the Reach Codes Team highlighted cells meeting these
two requirements to help clarify the upper boundary for potential reach code policies. All results presented in this study
have a positive compliance margin.
• Cells highlighted in green depict cases with a positive compliance margin and cost-effective results using both
On-Bill and TDV approaches.
• Cells highlighted in yellow depict cases with a positive compliance margin and cost-effective results using
either the On-Bill or TDV approach.
• Cells not highlighted depict cases with a positive compliance margin but that were not cost-effective using
either the On-Bill or TDV approach.
Following are key takeaways and recommendations from the analysis.
• The Reach Codes Team found all-electric new construction to be feasible and cost-effective based on the
California Energy Commission’s Time Dependent Valuation (TDV) metric in all cases. In many cases all-
electric prescriptive code construction results in an increase in utility costs and is not cost-effective On-Bill.
Some exceptions include the SMUD and CPAU territories where lower electricity rates relative to gas rates
result in lower overall utility bills.
• All-electric packages have lower GHG emissions than mixed fuel packages in all cases, due to the clean power
sources currently available from California’s power providers.
• The 2022 Energy Code’s new source energy metric combined with the heat pump space heating baseline in
most climate zones encourages all-electric construction. While the code does not include an electric baseline
for water heating, the penalty for central electric water heating observed in the performance approach in past
code cycles has been removed and a credit is provided for well-designed central heat pump water heaters in
most cases.
• Electrification combined with increased PV capacity results in utility cost savings and was found to be On-Bill
cost-effective in all cases.
• The results in this study are based on today’s net energy metering (NEM 2.0) rules and do not account for
recently approved changes to the NEM tariff (referred to as the net billing tariff). The net billing tariff decreases
the value of PV to the consumer as compared to NEM 2.0. As a result, the cost-effectiveness of the packages
that include above-code PV capacity is expected to be less under the net billing tariff. Conversely, the net
billing tariff is expected to increase On-Bill cost-effectiveness of the all-electric prescriptive code scenario. An
all-electric home has better on-site utilization of generated electricity from PV than a mixed fuel home with a
similar sized PV system, and as a result exports less electricity to the grid. Since the net-billing tariff values
exports less than under NEM 2.0, the relative impact on annual utility costs to the mixed fuel baseline is
greater.
• This analysis does justify requiring a modest reach based on either efficiency TDV or source energy for all-
electric buildings. However, this may be challenging for some projects given the recent changes to which the
industry must adapt, including the efficiency updates and multifamily restructuring in the 2022 Title 24, Part 6
code. While project compliance margins using a CO2 refrigerant heat pump water heating system are high, the
Reach Code Team found lower compliance margins using other heat pump water heater system designs.
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Focusing on supporting projects to electrify water heating is expected to support the market shift towards more
central heat pump water heaters.
• For jurisdictions interested in a reach code that allows for mixed fuel buildings, a mixed fuel efficiency and PV
package (and battery for the 3-story prototype) was found to be cost-effective based on TDV in all cases and
cost-effective On-Bill in most climate zones. This path, referred to as “Electric-Preferred”, allows for mixed fuel
buildings but requires a higher building performance than for all-electric buildings. The efficiency measures
evaluated in this study did not provide significant compliance benefit. As a result, the Reach Codes Team
recommends establishing a compliance margin target based on source energy or total TDV. This would allow
for PV and battery above minimum code requirements to be used to meet the target.
• Jurisdictions interested in increasing affordable multifamily housing should know that applying the CARE rates
has the overall impact of increasing utility cost savings for an all-electric building in most climate zones
compared to a code compliant mixed fuel building, improving On-Bill cost-effectiveness.
Local jurisdictions may also adopt ordinances that amend different parts of the California Building Standards Code or
may elect to amend other state or municipal codes. The decision regarding which code to amend will determine the
specific requirements that must be followed for an ordinance to be legally enforceable. Reach codes that amend Part 6
of the California Building Code and require energy performance beyond state code minimums must demonstrate the
proposed changes are cost-effective and obtain approval from the Energy Commission.
Table 22. Summary of Efficiency TDV Compliance Margins and Cost-Effectiveness
Climate
Zone
Electric
/Gas Utility
3-Story 5-Story
All-Electric
Prescriptive
Code
All-
Electric
+ PV
Mixed
Fuel
Efficiency
Mixed
Fuel
Efficiency
+ PV +
Battery
All-Electric
Prescriptive
Code
All-
Electric
+ PV
Mixed
Fuel
Efficiency
Mixed
Fuel
Efficiency
+ PV
CZ01 PGE 26% 26% 1% 1% 14% 14% 0% 0%
CZ02 PGE 20% 20% 1% 1% 9% 9% 1% 1%
CZ03 PGE 21% 21% 1% 1% 11% 11% 0% 0%
CZ04 PGE 18% 18% 1% 1% 9% 9% 1% 1%
CZ04 CPAU 18% 18% 1% 1% 9% 9% 1% 1%
CZ05 PGE 23% 23% 1% 1% 12% 12% 0% 0%
CZ05 PGE/SCG 23% 23% 1% 1% 12% 12% 0% 0%
CZ06 SCE/SCG 18% 18% 1% 1% 9% 9% 0% 0%
CZ07 SDGE 20% 20% 0% 0% 11% 11% 0% 0%
CZ08 SCE/SCG 13% 13% 1% 1% 8% 8% 1% 1%
CZ09 SCE 13% 13% 1% 1% 7% 7% 1% 1%
CZ10 SCE/SCG 14% 14% 3% 3% 7% 7% 2% 2%
CZ10 SDGE 14% 14% 3% 3% 7% 7% 2% 2%
CZ11 PGE 14% 14% 3% 3% 8% 8% 2% 2%
CZ12 PGE 17% 17% 2% 2% 9% 9% 2% 2%
CZ12 SMUD/PGE 17% 17% 2% 2% 9% 9% 2% 2%
CZ13 PGE 13% 13% 4% 4% 7% 7% 2% 2%
CZ14 SCE/SCG 13% 13% 3% 3% 6% 6% 2% 2%
CZ14 SDGE 13% 13% 3% 3% 6% 6% 2% 2%
CZ15 SCE/SCG 5% 5% 5% 5% 3% 3% 3% 3%
CZ16 PG&E 24% 24% 5% 5% 9% 9% 2% 2%
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
6 References
Barbose, G., Darghouth, N., O'Shaughnessy, E., & Forrester, S. (2022, October). Tracking the Sun. Pricing and Design
Trends for Distributed Photovoltaic Systems in the United States 2022 Edition. Retrieved from
https://emp.lbl.gov/tracking-the-sun
California Energy Commission. (2017). Rooftop Solar PV System. Measure number: 2019-Res-PV-D Prepared by
Energy and Environmental Economics, Inc. Retrieved from
https://efiling.energy.ca.gov/getdocument.aspx?tn=221366
California Energy Commission. (2022a). 2022 Building Energy Efficiency Standards for Residential and Nonresidential
Buildings. CEC-400-2022-010-CMF. Retrieved from https://www.energy.ca.gov/sites/default/files/2022-
12/CEC-400-2022-010_CMF.pdf
California Energy Commission. (2022b). 2022 Reference Appendices for the 202 Building Energy Efficiency Standards.
CEC-400-2022-010-AP. Retrieved from https://www.energy.ca.gov/sites/default/files/2022-08/CEC-400-
2022-010-AP.pdf
California Energy Commission. (2022c, Feb). 2022 Single-Family Residential Alternative Calculation Method Reference
Manual. CEC-400-2022-008-CMF-REV. Retrieved from https://www.energy.ca.gov/publications/2022/2022-
single-family-residential-alternative-calculation-method-reference-manual
California Public Utilities Commission. (2021a). Utility Costs and Affordability of the Grid of the Future: An Evaluation
of Electric Costs, Rates, and Equity Issues Pursuant to P.U. Code Section 913.1. Retrieved from
https://www.cpuc.ca.gov/-/media/cpuc-website/divisions/office-of-governmental-affairs-
division/reports/2021/senate-bill-695-report-2021-and-en-banc-whitepaper_final_04302021.pdf
California Public Utilities Commission. (2021b). Database for Energy-Efficient resources (DEER2021 Update). Retrieved
April 13, 2021, from http://www.deeresources.com/index.php/deer-versions/deer2021
California Public Utilities Commission. (2022). Proposed Decision Rulemaking 19-01-011: PHASE III DECISION
ELIMINATING GAS LINE EXTENSION ALLOWANCES. Retrieved from
https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M496/K876/496876177.PDF
E-CFR. (2020). https://www.ecfr.gov/cgi-
bin/retrieveECFR?gp=&SID=8de751f141aaa1c1c9833b36156faf67&mc=true&n=pt10.3.431&r=PART&ty=HTM
L#se10.3.431_197. Retrieved from Electronic Code of Federal Regulations: https://www.ecfr.gov/cgi-
bin/retrieveECFR?gp=&SID=8de751f141aaa1c1c9833b36156faf67&mc=true&n=pt10.3.431&r=PART&ty=HTM
L#se10.3.431_197
Energy + Environmental Economics. (2020). Time Dependent Valuation of Energy for Developing Building Efficiency
Standards: 2022 Time Dependent Valuation (TDV) and Source Energy Metric Data Sources and Inputs.
E-Source companies. (2020). Behind-the-Meter Battery Market Study. Prepared for San Diego Gas & Electric.
Retrieved from https://www.etcc-ca.com/reports/behind-meter-battery-market-study?dl=1582149166
Horii, B., Cutter, E., Kapur, N., Arent, J., & Conotyannis, D. (2014). Time Dependent Valuation of Energy for Developing
Building Energy Efficiency Standards.
Statewide CASE Team. (2018). Energy Savings Potential and Cost-Effectiveness Analysis of High Efficiency Windows in
California. Prepared by Frontier Energy. Retrieved from https://www.etcc-ca.com/reports/energy-savings-
potential-and-cost-effectiveness-analysis-high-efficiency-windows-california
Statewide CASE Team. (2020a). Nonresidential High Performance Envelope Codes and Standards Enhancement (CASE)
Initiative 2022 California Energy Code. Prepared by Energy Solutions. Retrieved from
https://title24stakeholders.com/wp-content/uploads/2020/10/2020-T24-NR-HP-Envelope-Final-CASE-
Report.pdf
Statewide CASE Team. (2020b). Residential Energy Savings and Process Improvements for Additions and Alterations
Codes and Standards Enhancement (CASE) Initiative 2022 California Energy Code. Prepared by Frontier
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Cost-Effectiveness Analysis: Single Family New Construction 35 References
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Energy. Retrieved from https://title24stakeholders.com/wp-content/uploads/2020/08/SF-Additions-and-
Alterations_Final_-CASE-Report_Statewide-CASE-Team.pdf
Statewide CASE Team. (2020c). Multifamily All-Electric Codes and Standards Enhancement (CASE) Initiative 2022
California Energy Code. Prepared by TRC.
Statewide Reach Codes Team. (2020). 2019 Mid-Rise New Construction Reach Code Cost-Effectiveness Study.
Prepared by Frontier Energy, Misti Bruceri & Associates, and EnergySoft. Retrieved from
https://localenergycodes.com/download/492/file_path/fieldList/2019%20Mid-rise%20NC%20Cost-
Eff%20Report.pdf
Statewide Reach Codes Team. (2021). 2019 Cost-Effectiveness Study: 2020 Analysis of High-Rise Residential New
Construction. Prepared by Frontier Energy and Misti Bruceri & Associates. Retrieved from
https://www.localenergycodes.com/download/737/file_path/fieldList/2019%20High-Rise%20NC-Cost-
Eff%20Report-2021-02-22.pdf
Statewide Reach Codes Team. (2022a). 2022 Cost-Effectiveness Study: Single Family new Construction. Prepared by
Frontier Energy and Misti Bruceri & Associates. Retrieved from California Energy Codes & Standards:
https://localenergycodes.com/content/resources
Statewide Reach Codes Team. (2022b). Nonresidential New Construction Reach Code Cost-effectiveness Study.
Prepared by Avani Goyal, Farhad Farahmand, TRC Companies. Retrieved from California Energy Codes &
Standards: https://localenergycodes.com/content/resources
TRC. (2018 ). 2019 Title 24 Energy Reach Code Cost-Effectiveness Analysis Draft. City of Palo Alto. Retrieved from
https://cityofpaloalto.org/civicax/filebank/documents/66742
TRC. (2019). Multifamily Prototypes. Prepared for Southern California Edison. Retrieved from
https://title24stakeholders.com/wp-content/uploads/2019/06/SCE-
MFModeling_MultifamilyPrototypesReport_2019-06-07_clean.pdf
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7 Appendices
7.1 Map of California Climate Zones
Climate zone geographical boundaries are depicted in Figure 3. The map in Figure 3 along with a zip-code search
directory is available at: https://ww2.energy.ca.gov/maps/renewable/building_climate_zones.html
Figure 3. Map of California climate zones.
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7.2 Utility Rate Schedules
The Reach Codes Team used the CA IOU and POU rate tariffs detailed below to determine the On-Bill savings for
each package. The California Climate Credit was applied for both electricity and natural gas service for the IOUs using
the 2022 credits shows below.9 The credits were applied to reduce the total calculated annual bill, including any fixed
fees or minimum bill amounts.
Electricity rates reflect the most recent approved tariffs. Monthly gas rates were estimated based on the latest available
gas rate (December 2022) and a curve to reflect how natural gas prices fluctuate with seasonal supply and demand.
The seasonal curve was estimated from monthly residential tariffs between 2012 and 2022 (between 2020 and 2022
for CPAU). 12-month curves were created from monthly gas rates for each of the eleven years (three years for CPAU).
These annual curves were then averaged to arrive at an average normalized annual curve. This was conducted
separately for baseline and excess energy rates. Costs used in this analysis were then derived by establishing the
most recent baseline and excess rate from the latest tariff as a reference point (December 2022), and then using the
normalized curve to estimate the cost for the remaining months relative to the reference point rate.
9 https://www.cpuc.ca.gov/industries-and-topics/natural-gas/greenhouse-gas-cap-and-trade-program/california-climate-
credit
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7.2.1 Pacific Gas & Electric
The following pages provide details on the PG&E electricity and natural gas tariffs applied in this study. Error!
Reference source not found. describes the baseline territories that were assumed for each climate zone. A net
surplus compensation rate of $0.0474/ kWh was applied to any net annual electricity generation based on a one-year
average of the rates between November 2021 and October 2022.
Table 23. PG&E Baseline Territory by Climate Zone
Climate
Zone
Baseline
Territory
CZ01 V
CZ02 X
CZ03 T
CZ04 X
CZ05 T
CZ11 R
CZ12 S
CZ13 R
CZ16 Y
The PG&E monthly gas rate in $/therm was applied on a monthly basis according to the rates shown in Error!
Reference source not found.. These are applied to both the G-1 and GM rates. These rates are based on applying a
normalization curve to the December 2022 tariff based on eleven years of historical gas data. See the beginning of
Section Error! Reference source not found. Error! Reference source not found. for further details. The
corresponding CARE rates are shown in Error! Reference source not found. and reflect the 20 percent discount per
the GL-1 tariff. The GM master metered wather heating baseline quantity of 0.43 therms per dwelling unit per day in all
baseline territories and in both seasons was applied to the centrally metered gas water heating.
Table 24. PG&E Monthly Gas Rate ($/therm)
Month Total Charge
Baseline Excess
January $2.20579 $2.66008
February $2.24291 $2.69637
March $2.11750 $2.58278
April $2.08101 $2.55500
May $2.08062 $2.55844
June $2.09104 $2.56928
July $2.10404 $2.58189
August $2.15162 $2.63251
September $2.18718 $2.67910
October $2.23153 $2.71934
November $2.32121 $2.79158
December $2.34123 $2.80922
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Table 25. PG&E Monthly CARE (GL-1) Gas Rate ($/therm)
Month Total CARE Charge
Baseline Excess
January $1.76463 $2.12806
February $1.79433 $2.15710
March $1.69400 $2.06622
April $1.66480 $2.04400
May $1.66449 $2.04675
June $1.67283 $2.05543
July $1.68323 $2.06551
August $1.72129 $2.10601
September $1.74974 $2.14328
October $1.78523 $2.17547
November $1.85697 $2.23327
December $1.87298 $2.24738
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7.2.2 Southern California Edison
The following pages provide details on are the SCE electricity tariffs applied in this study. Error! Reference source
not found. describes the baseline territories that were assumed for each climate zone. A net surplus compensation
rate of $ 0.04361/ kWh was applied to any net annual electricity generation based on a one-year average of the rates
between November 2021 and October 2022
Table 26: SCE Baseline Territory by Climate Zone
Climate
Zone
Baseline
Territory
CZ06 6
CZ08 8
CZ09 9
CZ10 10
CZ14 14
CZ15 15
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7.2.3 Southern California Gas
Following are the SoCalGas natural gas tariffs applied in this study. Error! Reference source not found. describes
the baseline territories that were assumed for each climate zone.
Table 27. SoCalGas Baseline Territory by Climate Zone
Climate
Zone
Baseline
Territory
CZ05 2
CZ06 1
CZ08 1
CZ09 1
CZ10 1
CZ14 2
CZ15 1
The SoCalGas monthly gas rate in $/therm was applied on a monthly basis according to the rates shown in Error!
Reference source not found.. These rates are based on applying a normalization curve to the December 2022 tariff
based on eleven years of historical gas data. See the beginning of Section Error! Reference source not found.
Error! Reference source not found. for further details. Long-term historical natural gas rate data was only available
for SoCalGas’ procurement charges.10 The baseline and excess transmission charges were found to be consistent
over the course of a year and applied for the entire year based on 2022 rates. CARE rates reflect the 20 percent
discount per the GR tariff.
Table 28. SoCalGas Monthly Gas Rate ($/therm)
Month Procurement
Charge
Transportation Charge Total Charge
Baseline Excess Baseline Excess
January $0.90581 $0.82487 $1.23877 $1.73068 $2.14458
February $0.83669 $0.82487 $1.23877 $1.66156 $1.84967
March $0.80596 $0.82487 $1.23877 $1.63083 $1.82938
April $0.71941 $0.82487 $1.23877 $1.54428 $1.75890
May $0.77049 $0.82487 $1.23877 $1.59536 $1.78548
June $0.86253 $0.82487 $1.23877 $1.68740 $1.83337
July $0.87687 $0.82487 $1.23877 $1.70174 $1.86833
August $0.95391 $0.82487 $1.23877 $1.77878 $1.91089
September $0.85896 $0.82487 $1.23877 $1.68383 $1.83611
October $0.84147 $0.82487 $1.23877 $1.66634 $1.84936
November $0.89018 $0.82487 $1.23877 $1.71505 $1.88836
December $1.05329 $0.82487 $1.23877 $1.87816 $1.98294
10 The SoCalGas procurement and transmission charges were obtained from the following site:
https://www.socalgas.com/for-your-business/energy-market-services/gas-prices
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7.2.4 San Diego Gas & Electric
Following are the SDG&E electricity and natural gas tariffs applied in this study. Error! Reference source not found.
describes the baseline territories that were assumed for each climate zone. A net surplus compensation rate of
$0.04174 / kWh was applied to any net annual electricity generation based on a one-year average of the rates between
January 2022 and December 2022.
Table 29. SDG&E Baseline Territory by Climate Zone
Climate
Zone
Baseline
Territory
CZ07 Coastal
CZ10 Inland
CZ14 Mountain
The SDG&E monthly gas rate in $/therm was applied on a monthly basis according to the rates shown in Error!
Reference source not found.. These rates are based on applying a normalization curve to the December 2022 tariff
based on eleven years of historical gas data. See the beginning of Section Error! Reference source not found.
Error! Reference source not found. for further details. CARE rates reflect the 20 percent discount per the G-CARE
tariff.
Table 30. SDG&E Monthly Gas Rate ($/therm)
Month Total Charge
Baseline Excess
January $2.33762 $2.34748
February $2.26751 $2.28440
March $2.25119 $2.27016
April $2.20192 $2.22744
May $2.24252 $2.26403
June $2.31819 $2.33060
July $2.32406 $2.33630
August $2.37527 $2.38090
September $2.33542 $2.34971
October $2.30366 $2.32151
November $2.31722 $2.33381
December $2.45653 $2.73517
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7.2.5 City of Palo Alto Utilities
Following are the CPAU electricity and natural gas tariffs applied in this study. The CPAU monthly gas rate in
$/therm was applied on a monthly basis according to the rates shown in Error! Reference source not found.. These
rates are based on applying a normalization curve to the December 2022 tariff based on three years of historical gas
data. See the beginning of Section Error! Reference source not found. Error! Reference source not found. for
further details. The monthly service charge applied was $106.90 per month per the December 2022 G-2 tariff.
Table 31. CPAU Monthly Gas Rate ($/therm)
Month G2
Volumetric
Totals
January $1.80964
February $1.67009
March $1.68480
April $1.68698
May $1.78478
June $1.88288
July $1.88355
August $2.06943
September $2.06798
October $2.08553
November $2.09681
December $2.45700
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7.2.6 Sacramento Municipal Utilities District (Electric Only)
Following are the SMUD electricity tariffs applied in this study. The rates effective January 2023 were used.
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7.2.7 Fuel Escalation Assumptions
The average annual escalation rates in Error! Reference source not found. were used in this study. These are based
on assumptions from the CPUC 2021 En Banc hearings on utility costs through 2030 (California Public Utilities
Commission, 2021a). Escalation rates through the remainder of the 30-year evaluation period are based on the
escalation rate assumptions within the 2022 TDV factors. No data was available to estimate electricity escalation rates
for CPAU and SMUD, therefore electricity escalation rates for PG&E and statewide natural gas escalation rates were
applied.
Table 32: Real Utility Rate Escalation Rate Assumptions
Statewide Natural
Gas Residential
Average Rate
(%/year, real)
Electric Residential Average Rate
(%/year, real)
PG&E SCE SDG&E
2023 4.6% 1.8% 1.6% 2.8%
2024 4.6% 1.8% 1.6% 2.8%
2025 4.6% 1.8% 1.6% 2.8%
2026 4.6% 1.8% 1.6% 2.8%
2027 4.6% 1.8% 1.6% 2.8%
2028 4.6% 1.8% 1.6% 2.8%
2029 4.6% 1.8% 1.6% 2.8%
2030 4.6% 1.8% 1.6% 2.8%
2031 2.0% 0.6% 0.6% 0.6%
2032 2.4% 0.6% 0.6% 0.6%
2033 2.1% 0.6% 0.6% 0.6%
2034 1.9% 0.6% 0.6% 0.6%
2035 1.9% 0.6% 0.6% 0.6%
2036 1.8% 0.6% 0.6% 0.6%
2037 1.7% 0.6% 0.6% 0.6%
2038 1.6% 0.6% 0.6% 0.6%
2039 2.1% 0.6% 0.6% 0.6%
2040 1.6% 0.6% 0.6% 0.6%
2041 2.2% 0.6% 0.6% 0.6%
2042 2.2% 0.6% 0.6% 0.6%
2043 2.3% 0.6% 0.6% 0.6%
2044 2.4% 0.6% 0.6% 0.6%
2045 2.5% 0.6% 0.6% 0.6%
2046 1.5% 0.6% 0.6% 0.6%
2047 1.3% 0.6% 0.6% 0.6%
2048 1.6% 0.6% 0.6% 0.6%
2049 1.3% 0.6% 0.6% 0.6%
2050 1.5% 0.6% 0.6% 0.6%
2051 1.8% 0.6% 0.6% 0.6%
2052 1.8% 0.6% 0.6% 0.6%
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7.3 Cost Details
Table 33 presents additional detail on the first cost assumptions for the central water heating systems. For the 5-story
prototype costs are provided both for a CO2 refrigerant Sanden-based and R-134a refrigerant Colmac-based heat
pump water heater designs. The results presented in the main body of this report are based on the Sanden design. A
sensitivity analysis was also conducted for a Colmac design (see Appendix 7.5 Central Heat Pump Water Heater
Comparison) and the cost comparison is presented here. All costs are based on data from the 2022 Multifamily All-
Electric CASE Report (Statewide CASE Team, 2020c).
Table 33. Heat Pump Water Heater First Costs per Building (Present Value (2023$))
Item
3-Story (36-units) 5-Story (88-units)
Gas
Boiler
(CZs 1-9)
Gas Boiler
(CZs 10-16)
Heat
Pump
Gas
Boiler
(CZs 1-9)
Gas Boiler
(CZs 10-16)
Heat
Pump
(Sanden)
Heat
Pump
(Colmac)
Water Heating
Equipment $87,602 $87,602 $140,907 $135,146 $135,146 $244,742 $319,485
Solar Thermal
Collector $39,800 $46,888 n/a $74,740 $91,776 n/a n/a
Gas Piping $8,890 $8,890 n/a $9,065 $9,065 n/a n/a
Electrical Circuits n/a n/a $25,000 n/a n/a $25,000 $25,000
Overhead & Markup $37,480 $39,430 $45,624 $60,212 $64,896 $74,179 $94,733
Total $173,772 $182,810 $211,531 $279,163 $300,883 $343,920 $439,218
Table 34 presents additional detail on the first cost assumptions for the space hating systems.
Table 34. Heat Pump Space Heater First Costs per Dwelling Unit (Present Value (2023$)
Item
3-Story 5-Story
Source & Notes Furnace +
Split AC
Heat
Pump
Furnace +
Split HP
Heat
Pump
Dwelling Unit HVAC
$5,651 $5,460 $6,109 $5,460
Gas system costs based on 2022
Multifamily All-Electric CASE Report.
Heat pump costs based on online
equipment research indicating a 2-ton
HP is $191 less than a furnace/AC of
the same size.
Refrigerant Piping $563 $563 $423 $423 2022 Multifamily All-Electric CASE
Report. Gas Piping $92 $0 $227 $0
Electrical Circuits $0 $150 $0 $150
Labor
$9,904 $6,985 $9,904 $6,985
Based on the 2022 Multifamily All-
Electric CASE Report with
adjustments to align with updated
equipment costs.
Overhead & Markup $4,457 $3,618 $4,582 $3,579 Based on a 27% markup
Total $20,667 $16,776 $21,245 $16,597
Incremental Cost ($3,891) ($4,647)
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7.4 PG&E Gas Infrastructure Cost Memo
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7.5 Central Heat Pump Water Heater Comparison
Table 35 presents energy and cost-effectiveness results for a R-134a refrigerant based system design using a Colmac central heat pump water heater in the 5-
story prototype. This was only found to be cost-effective based on at least one of the two metrics in Climate Zones 1, 4 in CPAU territory, and 16.
Table 35. 5-Story Cost-Effectiveness: All-Electric Prescriptive Code with R-134a Heat Pump Water Heater
Climate
Zone
Electric
/Gas Utility
Efficiency
TDV
Comp
Margin
Source
Comp
Margin
Annual
Elec
Savings
(kWh)
Annual
Gas
Savings
(therms)
Utility Cost
Savings Incremental Cost On-Bill TDV
First
Year
Lifecycle
(2022$)
First
Year
Lifecycle
(2022$)
B/C
Ratio NPV B/C
Ratio NPV
CZ01 PGE 6% 6% -1,496 147 ($155) ($1,240) ($3,556) ($4,223) 3.4 $2,984 >1 $5,870
CZ02 PGE 4% 2% -1,197 120 ($145) ($1,513) $1,691 $2,749 0.0 ($4,262) 0.5 ($1,287)
CZ03 PGE 6% 3% -1,166 120 ($138) ($1,360) $1,691 $2,749 0.0 ($4,109) 0.8 ($523)
CZ04 PGE 4% 2% -1,116 113 ($76) ($49) $1,691 $2,749 0.0 ($2,798) 0.7 ($949)
CZ04 CPAU 4% 2% -1,116 113 $185 $7,144 $1,718 $2,776 2.6 $4,368 0.6 ($976)
CZ05 PGE 5% 2% -1,161 117 ($137) ($1,391) $1,691 $2,749 0.0 ($4,140) 0.5 ($1,412)
CZ05 PGE/SCG 5% 2% -1,161 117 ($189) ($3,016) $1,691 $2,749 0.0 ($5,765) 0.5 ($1,412)
CZ06 SCE/SCG 4% 1% -1,000 104 ($92) ($879) $1,691 $2,749 0.0 ($3,628) 0.6 ($1,013)
CZ07 SDGE 5% 2% -996 106 ($183) ($3,216) $1,691 $2,749 0.0 ($5,965) 0.7 ($936)
CZ08 SCE/SCG 3% 1% -948 100 ($156) ($2,413) $1,691 $2,749 0.0 ($5,162) 0.7 ($695)
CZ09 SCE 3% 0% -966 100 ($132) ($1,863) $1,691 $2,749 0.0 ($4,612) 0.7 ($738)
CZ10 SCE/SCG 3% 1% -962 84 ($188) ($3,375) $1,444 $2,395 0.0 ($5,770) 0.3 ($1,596)
CZ10 SDGE 3% 1% -962 84 ($239) ($4,959) $1,444 $2,395 0.0 ($7,354) 0.3 ($1,596)
CZ11 PGE 4% 3% -1,029 92 ($165) ($2,487) $1,444 $2,395 0.0 ($4,882) 0.4 ($1,367)
CZ12 PGE 4% 3% -1,081 96 ($172) ($2,591) $1,444 $2,395 0.0 ($4,986) 0.3 ($1,667)
CZ12 SMUD/PGE 4% 3% -1,081 96 $26 $1,988 $1,444 $2,395 0.8 ($407) 0.3 ($1,667)
CZ13 PGE 3% 2% -976 88 ($156) ($2,361) $1,444 $2,395 0.0 ($4,756) 0.4 ($1,452)
CZ14 SCE/SCG 2% -1% -1,045 84 ($210) ($3,880) $1,444 $2,395 0.0 ($6,275) 0.1 ($2,056)
CZ14 SDGE 2% -1% -1,045 84 ($270) ($5,725) $1,444 $2,395 0.0 ($8,120) 0.1 ($2,056)
CZ15 SCE/SCG 2% -1% -718 65 ($146) ($2,713) $1,444 $2,395 0.0 ($5,108) 0.3 ($1,564)
CZ16 PG&E -5% 6% -1,913 142 ($276) ($4,142) ($3,803) ($4,577) 1.1 $435 1.2 $746
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Cost-Effectiveness Analysis: Single Family New Construction 63 Appendices
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
7.6 Summary of Measures by Package
Table 36 provides the details of the measures in each of the efficiency package by climate zone. The measures are the
same for the 3-story and 5-story prototypes. Table 37 presents the PV capacities per dwelling unit in the upgrade
packages. In Climate Zone 6 for the mixed fuel case in the 5-story prototype there is no upgrade to the PV system
capacity as the prescriptive PV system already offset all of the estimated electricity use.
Table 36. Mixed Fuel Efficiency Package Measures
Climate
Zone
0.70 Roof
Solar
Reflectance
0.24 U-Factor
Windows
0.35
W/cfm
Verified Low
Leakage Ducts in
Conditioned
Space
1 X X
2 X
3 X
4 X
5 X
6 X
7 X
8 X
9 X X
10 X X X
11 X X X
12 X X X
13 X X X
14 X X X
15 X X X
16 X X X
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Cost-Effectiveness Analysis: Single Family New Construction 64 Appendices
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
Table 37. Upgrade Package PV Capacities (kW-DC)
Climate
Zone
All-Electric + PV Mixed Fuel + PV
3-Story 5-Story 3-Story 5-Story
CZ01 4.41 4.35 3.69 3.43
CZ02 3.56 3.58 3.02 2.98
CZ03 3.31 3.29 2.80 2.72
CZ04 3.21 3.27 2.73 2.75
CZ05 3.04 3.08 2.57 2.55
CZ06 2.91 3.04 2.49 2.68
CZ07 3.09 3.21 2.64 2.74
CZ08 3.18 3.30 2.76 2.86
CZ09 3.04 3.16 2.63 2.73
CZ10 3.20 3.30 2.79 2.86
CZ11 3.90 3.95 3.42 3.43
CZ12 3.53 3.60 3.05 3.08
CZ13 3.77 3.84 3.32 3.36
CZ14 3.20 3.23 2.79 2.79
CZ15 3.93 3.94 3.58 3.58
CZ16 3.79 3.76 2.60 2.90
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Cost-Effectiveness Analysis: Single Family New Construction 65 Appendices
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-06-20
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The adoption of reach codes can differentiate jurisdictions as efficiency leaders and help accelerate the
adoption of new equipment, technologies, code compliance, and energy savings strategies.
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Page 1944 of 2029
Cost-effectiveness Analysis: Nonresidential New Construction Buildings
Prepared by:
Avani Goyal, Farhad Farahmand
TRC Companies Inc.
Prepared for:
Jay Madden
Codes and Standards Program Southern California Edison
Last modified: 2023/03/24
Revision: 1.3
2 0 2 2 C o d e :
Nonresidential New
Construction Reach Code
Cost-effectiveness Study
Page 1945 of 2029
Cost-effectiveness Analysis: Nonresidential New Construction Buildings
Legal Notice
This report was prepared by Southern California Edison Company
and funded by the California utility customers under the auspices
of the California Public Utilities Commission.
Copyright 2023, Southern California Edison Company. All rights
reserved, except that this document may be used, copied, and
distributed without modification.
Neither SCE nor any of its employees makes any warranty,
express or implied; or assumes any legal liability or responsibility
for the accuracy, completeness or usefulness of any data,
information, method, product, policy, or process disclosed in this
document; or represents that its use will not infringe any privately -
owned rights including, but not limited to, patents, trademarks, or
copyrights.
Acronym List
AC – Air Conditioner
ASHRAE - American Society of Heating, Refrigerating
and Air-Conditioning Engineers
B/C – Benefit-to-Cost Ratio
BOD – Basis of Design
BSC – Building Standards Commission
Btu – British thermal unit
CAV – Constant Air Volume
CBECC - California Building Energy Code Compliance
CBECS - Commercial Building Energy Consumption Survey
CBSC - California Building Standards Commission
CEC - California Energy Commission
CPAU – City of Palo Alto Utilities
CZ – Climate Zone
DCKV – Demand-Controlled Kitchen Ventilation
DHW – Domestic Hot Water
DEER – Database for Energy Efficient Resources
DOE – U.S. Department of Energy
E3 – Energy and Environmental Economics
EUI – Energy Use Index
FDD – Fault Detection and Diagnostics
GHG - Greenhouse Gas
GPM – Gallons Per Minute
HVAC – Heating, Ventilation, and Air Conditioning
IOU – Investor-Owned Utility
Page 1946 of 2029
Cost-effectiveness Analysis: Nonresidential New Construction Buildings
kWh – Kilowatt Hour
LADWP – Los Angeles Department of Water and Power
LBNL – Lawrence Berkeley National Lab
LPD – Lighting Power Density
NPV – Net Present Value
QSR – Quick-Service Restaurant
PNNL – Pacific Northwest National Laboratory
POU – Publicly Owned Utility
PTHP – Packaged Terminal Heat Pump
PG&E – Pacific Gas & Electric (utility)
PTAC – Packaged Terminal Air Conditioning
PV - Solar Photovoltaic
SCE – Southern California Edison (utility)
SCG – Southern California Gas (utility)
SDG&E – San Diego Gas & Electric (utility)
SHW – Service Hot Water
SMUD – Sacramento Municipal Utility District
SZ – Single Zone
TDV – Time Dependent Valuation
VAV – Variable Air Volume
TDV - Time Dependent Valuation
Title 24 – California Code of Regulations Title 24, Part 6
TOU – Time of Use
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Cost-effectiveness Analysis: Nonresidential New Construction Buildings
Summary of Revisions
Date Description Reference (page or section)
11/16/2022 Original Release -
01/31/2023 Minor changes to reflect efficiency compliance
margin calculation updates in workbook and report
tables
Section 5
03/24/2023 Minor changes in narrative of quick service
restaurant in reach code considerations
Section 5
Page 1948 of 2029
Cost-effectiveness Analysis: Nonresidential New Construction Buildings
TABLE OF CONTENTS
Executive Summary .......................................................................................................................................................... 1
1 Introduction ................................................................................................................................................................ 3
2 Methodology and Assumptions ............................................................................................................................... 5
2.1 Cost-effectiveness ................................................................................................................................................................ 5
2.1.1 Benefits ......................................................................................................................................................................... 5
2.1.2 Costs ............................................................................................................................................................................. 5
2.1.3 Metrics .......................................................................................................................................................................... 6
2.1.4 Utility Rates ................................................................................................................................................................... 6
2.2 Energy Simulations ............................................................................................................................................................... 7
2.3 2022 T24 Compliance Metrics .............................................................................................................................................. 7
2.4 GHG Emissions .................................................................................................................................................................... 8
2.5 Limitations and Further Considerations ................................................................................................................................ 8
3 Prototypes, Measure Packages, and Costs .......................................................................................................... 10
3.1 Prototype Characteristics .................................................................................................................................................... 10
3.2 Measure Definitions and Costs ........................................................................................................................................... 12
3.2.1 Fuel Substitution ......................................................................................................................................................... 12
3.2.2 Efficiency ..................................................................................................................................................................... 21
3.2.3 Load Flexibility ............................................................................................................................................................ 28
3.2.4 Additional Solar PV and Battery Storage .................................................................................................................... 29
3.3 Measure Packages ............................................................................................................................................................. 30
4 Cost-Effectiveness Results .................................................................................................................................... 32
4.1 Medium Office ..................................................................................................................................................................... 33
4.2 Medium Retail ..................................................................................................................................................................... 34
4.3 Quick-Service Restaurant (QSR) ........................................................................................................................................ 35
4.4 Small Hotel .......................................................................................................................................................................... 36
5 Energy Code Compliance Results and Reach Code Considerations ................................................................ 37
5.1 Medium Office ..................................................................................................................................................................... 41
5.2 Medium Retail ..................................................................................................................................................................... 42
5.3 Quick-Service Restaurant (QSR) ........................................................................................................................................ 44
5.4 Small Hotel .......................................................................................................................................................................... 46
6 Conclusions ............................................................................................................................................................. 48
7 References ............................................................................................................................................................... 50
8 Appendices .............................................................................................................................................................. 52
8.1 Map of California CZs ......................................................................................................................................................... 52
8.2 Utility Rate Schedules ......................................................................................................................................................... 53
8.2.1 PG&E .......................................................................................................................................................................... 54
8.2.2 SCE............................................................................................................................................................................. 57
8.2.3 SCG ............................................................................................................................................................................ 60
8.2.4 SDG&E ....................................................................................................................................................................... 62
8.2.5 CPAU .......................................................................................................................................................................... 68
8.2.6 SMUD (Electric Only) .................................................................................................................................................. 70
8.2.7 Escalation Rates ......................................................................................................................................................... 71
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Cost-effectiveness Analysis: Nonresidential New Construction Buildings
8.3 HVAC and SHW System Cost Scalers ............................................................................................................................... 71
8.4 Mixed Fuel Baseline Figures ............................................................................................................................................... 72
8.5 GHG Savings Summary ...................................................................................................................................................... 76
LIST OF TABLES
Table 1. Utility Tariffs Used Based on CZ (October 2022) .................................................................................................................... 7
Table 2. Baseline Prototype Characteristics ....................................................................................................................................... 11
Table 3. HVAC and Water Heating Characteristics Summary ............................................................................................................ 14
Table 4. Medium Office Average Mechanical System Costs .............................................................................................................. 15
Table 5. Medium Retail Average Mechanical System Costs ............................................................................................................... 16
Table 6. Quick-Service Restaurant Average Mechanical System Costs - HS Package ...................................................................... 16
Table 7. Small Hotel HVAC and Water Heating System Costs ........................................................................................................... 18
Table 8. Quick-Service Restaurant Cooking Equipment Costs ........................................................................................................... 18
Table 9. Small Hotel Clothes Dryer Costs ........................................................................................................................................... 19
Table 10. Electrical Infrastructure Costs ............................................................................................................................................. 20
Table 11. Gas Infrastructure Costs by Component ............................................................................................................................. 21
Table 12. Total Gas Infrastructure Cost Estimates by Building Type .................................................................................................. 21
Table 13. Efficiency Measures Applicability, Costs, and Sources ....................................................................................................... 26
Table 14. Load Flexibility Measure Summary ..................................................................................................................................... 29
Table 15. Additional Solar PV Measure Summary .............................................................................................................................. 30
Table 16. Reach Code Pathway Considerations ................................................................................................................................ 39
Table 17. Cost-effectiveness and Compliance Summary – Medium Office ........................................................................................ 41
Table 18. Cost-effectiveness and Compliance Summary – Medium Retail......................................................................................... 42
Table 19. Cost-effectiveness and Compliance Summary – Quick-Service Restaurant (without cooking electrification) ..................... 44
Table 20. Cost-effectiveness and Compliance Summary – Quick-Service Restaurant (with cooking electrification) .......................... 45
Table 21. Cost-effectiveness and Compliance Summary – Small Hotel. ............................................................................................ 46
Table 22. Cost-effectiveness and Compliance Summary – Small Hotel (PTHP) ................................................................................ 47
Table 23. Utility Tariffs Analyzed Based on CZ – Detailed View ......................................................................................................... 53
Table 24. Real Utility Rate Escalation Rate Assumptions Above Inflation .......................................................................................... 71
Table 25. Materials and Labor Adjustment Factors by Climate Zone ................................................................................................. 71
Table 26. Contractor Markup Values .................................................................................................................................................. 72
Table 27. Mixed Fuel Baseline Model – Medium Office ...................................................................................................................... 72
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Cost-effectiveness Analysis: Nonresidential New Construction Buildings
Table 28. All-electric Baseline Model – Medium Retail ....................................................................................................................... 73
Table 29. Mixed Fuel Baseline Model – Quick-Service Restaurant .................................................................................................... 74
Table 30. Mixed Fuel Baseline Model – Small Hotel ........................................................................................................................... 75
LIST OF FIGURES
Figure 1. Medium Office Cost-Effectiveness Summary....................................................................................................................... 33
Figure 2. Medium Retail Cost-effectiveness Summary ....................................................................................................................... 34
Figure 3. QSR Cost-effectiveness Summary ...................................................................................................................................... 35
Figure 4. Small Hotel Cost-effectiveness Summary ............................................................................................................................ 36
Figure 5. Map of California CZs .......................................................................................................................................................... 52
Figure 6. PG&E Electric Schedule - B-1 ............................................................................................................................................. 54
Figure 7. PG&E Electric Schedule - B-10 ........................................................................................................................................... 55
Figure 8. PG&E Gas Schedule – G-NR1 ............................................................................................................................................ 56
Figure 9. SCE Electric Schedule – TOU-GS-1 .................................................................................................................................... 57
Figure 10. SCE Electric Schedule – TOU-GS-2 .................................................................................................................................. 58
Figure 11. SCE Electric Schedule – TOU-GS-3 .................................................................................................................................. 59
Figure 12. SCG Gas Schedule – G-10................................................................................................................................................ 60
Figure 13. SDG&E Electric Schedule – AL-TOU ................................................................................................................................ 62
Figure 14. SDG&E Electric Schedule - EECC .................................................................................................................................... 65
Figure 15. SDG&E Gas Schedule – GN-3 .......................................................................................................................................... 66
Figure 16. CPAU Electric Schedule – E-2........................................................................................................................................... 68
Figure 17. CPAU Gas Schedule – G-2 ............................................................................................................................................... 69
Figure 18. SMUD Electric Schedule – CITS-0/CITS-1 ........................................................................................................................ 70
Figure 19. Percentage GHG Savings – Medium Office ...................................................................................................................... 76
Figure 20. Percentage GHG Savings – Medium Retail ....................................................................................................................... 76
Figure 21. Percentage GHG Savings – Quick Service Restaurant ..................................................................................................... 77
Figure 22. Percentage GHG Savings – Small Hotel ........................................................................................................................... 77
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Cost-Effectiveness Analysis: Nonresidential New Construction Buildings 1
Executive Summary
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-03-24
Executive Summary
The California Codes and Standards (C&S) Reach Codes program provides technical support to local governm ents
considering adopting a local ordinance, also known as a reach code, intended to support meeting local and/or
statewide energy efficiency and greenhouse gas (GHG) reduction goals. The program facilitates the adoption and
implementation of reach codes when requested by local jurisdictions by providing resources such as cost-effectiveness
studies, model language, sample findings, and other supporting documentation.
The Reach Code Team (the Team) provides this report and accompanying Reach Code Results Workbook to present
measures and measure packages that local jurisdictions can adopt to achieve energy savings and emissions
reductions beyond what will be accomplished by enforcing the minimum state requirements according to the 2022
Building Energy Efficiency Standards (Title 24, Part 6), effective January 1, 2023. This report documents a variety of
above-code electrification, energy efficiency, load flexibility, and solar photovoltaic (PV) packages applied to a set of
four nonresidential building prototypes: Medium Office, Standalone Retail, Quick-Service Restaurant, and Small Hotel.
The Team evaluated energy simulation results and code compliance using the CBECC v1.0 software version released
in June 2022. Results may change with future software versions. Results across all prototypes indicate the efficiency
measures included in the analysis, both On-Bill and TDV, are cost-effective across all climate zones when added to the
prescriptive baseline prototype. In all cases all-electric packages are capable of achieving the greatest greenhouse gas
emissions reductions as compared to mixed-fuel buildings.
These results, including the attached Reach Code Results Workbook, indicate that all -electric packages can achieve
the greatest greenhouse gas emissions reductions as compared to mixed-fuel buildings. Results align with the
decarbonization objectives set by California Energy Commission (Energy Commission), and several new construction
new construction ordinances focusing on all-electric design. The results of this study by prototype are summarized
below:
Medium Office: Due to the lack of a prescriptive compliance pathway and performance modeling approach in
CBECC, all-electric space heating is simulated as electric-resistance variable-air-volume reheat. This system
selection limits operational benefits, energy code compliance, and cost-effectiveness. All-electric packages are
cost-effective with energy efficiency and load flexibility measures in many climate zones, but do not achieve
code compliance across all three metrics—with efficiency TDV margin being the most challenging. Results will
be updated in the first half of 2023 when central heat pump boilers can be simulated in CBECC. Jurisdictions
may adopt reach codes that exempt building systems that do not have a prescriptive pathway in the energy
code and cannot be modeled to comply using the performance approach. Efficiency packages over the mixed-
fuel baseline are cost-effective and compliant across all climate zones.
Medium Retail: All-electric is prescriptively required in most scenarios in Retail buildings. The Team identified
cost-effective and code compliant packages with energy efficiency measures over an all-electric baseline in
most climate zones. This study analyzed mixed-fuel retail buildings with large (>240 kBtuh) gas furnace
packaged units replacing the smaller (<240 kBtuh) packaged heat pumps. The mixed-fuel building is neither
cost-effective nor code compliant in most climate zones.
Quick-Service Restaurant: The Team identified cost-effective, nearly cost-effective, and code compliant
packages in several climate zones for all-electric space conditioning and service water heating when including
energy efficiency and solar PV measures. The Team could not identify cost-effective packages including all-
electric commercial cooking equipment except for City of Palo Alto Utility (CPAU) territory. Also, when including
energy efficiency measures, restaurants with all-electric cooking achieve compliance and are nearly On-Bill
cost-effective in Sacramento Municipal Utility District (SMUD) territory as well. Jurisdictions may adopt All-
Electric reach codes that exempt commercial cooking equipment or require energy efficiency for either mixed-
fuel and/or all-electric buildings, in many climate zones.
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Cost-Effectiveness Analysis: Nonresidential New Construction Buildings 2
Executive Summary
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-03-24
Small Hotel: All-electric packages are cost-effective and code-compliant in most climate zones. The remaining
climate zones are very close to meeting the TDV Efficiency compliance criteria and may achieve compliance
by re-evaluating nonresidential-area modeling using central heat pump boiler instead of electric resistance
VAV systems. In addition to electrification packages that include single-zone packaged heat pumps, the Team
analyzed an alternative scenario with packaged terminal heat pumps (PTHPs) that improved all-electric code
minimum cost-effectiveness due to high first-cost savings, but PTHPs do not achieve TDV Efficiency
compliance. Mixed-fuel plus energy efficiency is code compliant and cost-effective across all climate zones.
Jurisdictions may use these results for amending Part 6, Part 11, other parts of the California building code, or their
municipal code as determined appropriate for the given jurisdiction. A cost-effectiveness study is required to amend
Part 6 of the California building code or when adopting energy efficiency or energy conservation measures, including
solar PV or batteries. The Energy Commission has previously concluded that all-electric requirements do not constitute
an energy efficiency or energy conservation standard and are outside the scope of Public Resources Code s ection
25402.1(h)(2).1 Jurisdictions may adopt an All-Electric reach code when amending Part 11 or their municipal code.
Even reach code policies that only require electrification, and do not require energy efficiency or conservation, will
benefit from findings in this study to inform potential economic impacts of a policy decision. This study documents the
estimated costs, benefits, energy impacts and GHG emission reductions that may result from implementing an
ordinance based on the results to help residents, local leadership, and other stakeholders make informed policy
decisions.
Model ordinance language and other resources are posted on the C&S Reach Codes Program website at
www.localenergycodes.com. Local jurisdictions that are considering adopting an ordinance are encouraged to contact
the program for further technical support at info@localenergycodes.com .
1 CEC Letter to South San Francisco 2021: https://bayareareachcodes.org/wp-content/uploads/2022/10/CEC-Letter-to-SSF-
Signed.pdf
Page 1953 of 2029
Cost-Effectiveness Analysis: Nonresidential New Construction Buildings 3
Introduction
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-03-24
1 Introduction
This report documents cost-effective combinations of measures that exceed the minimum state requirements, the 20 22
California Building Energy Efficiency Standards Title 24, Part 6 (Title 24) (CEC 2022), effective January 1, 2023, for
newly constructed nonresidential buildings. This report was developed in coordination with the California Statewide
Investor-Owned Utilities (CA IOUs) Codes and Standards Program, key consultants, and engaged cities—collectively
known as the Reach Code Team (or “the Team” for short). The objectives of this report are to inform discourse for local
reach code adoption and, where applicable, support approval of local energy code amendments from the California
Energy Commission (the Energy Commission).
The Reach Code Team performed cost-effectiveness analysis for the following scenarios above prescriptive 2022 Title
24 code requirements in all 16 California climate zones (CZs):
▪ Fuel substitution with federal code-minimum efficiency appliances, compared to a prescriptive minimum design
compliance pathway.
• For the retail building type, the prescriptive code minimum is all-electric. Fuel substitution packages
revert to mixed-fuel appliances.
• For all other building types, the prescriptive code minimum is mixed -fuel. Fuel substitution packages
switch to all-electric appliances.
▪ Energy efficiency measures
▪ Load flexibility measures
▪ Solar PV and Battery
The Reach Code Team analyzed four prototypes—Medium Office, Medium Retail, Quick-Service Restaurant, and
Small Hotel—to represent common nonresidential new construction buildings in the California. The selected building
types align with the requests received from dozens of jurisdictions seeking to adopt reach codes. The results of this
cost-effectiveness study could potentially be extrapolated to other building types that have sim ilar properties such as
occupancy pattern, HVAC design and layout. These results were attained using the first version of California Building
Energy Compliance Calculator (CBECC) software that is approved by CEC for 2022 code compliance. There are a few
gaps in functionalities and standard design assumptions in this software version, described in Section 2.5, the Reach
Code team has been actively coordinating with the CBECC software team to inform future software updates.
Title 24 is maintained and updated every three years by two state agencies: the Energy Commission and the Building
Standards Commission (BSC). In addition to enforcing the code, local jurisdictions have the authority to adopt local
energy efficiency ordinances—or reach codes—that exceed the minimum standards defined by Title 24 (as established
by Public Resources Code Section 25402.1(h)2 and Section 10-106 of the Building Energy Efficiency Standards).
When adopting local energy efficiency or conservation ordinances, local jurisdictions must demonstrate that the
requirements of the proposed ordinance are cost-effective and do not result in buildings consuming more energy than
is permitted by Title 24. In addition, the jurisdiction must obtain formal approval from the Energy Commission and file
the ordinance with the BSC for the ordinance to be legally enforceable. Local jurisdictions do not require Energy
Commission approval when adopting ordinances that do not require efficiency or conservation, such as only
electrification-required ordinances.
The Department of Energy (DOE) sets minimum efficiency standards for equipment and appliances that are federally
regulated under the National Appliance Energy Conservation Act, including heating, cooling, and water hea ting
equipment (E-CFR 2020). Since state and local governments are prohibited from adopting higher minimum equipment
efficiencies than the federal standards require, the focus of this study is to identify and evaluate cost -effective
packages that do not include high efficiency heating, cooling, and water heating equipment. High efficiency appliances
are often the easiest and most affordable measures to increase energy performance. While federal preemption limits
Page 1954 of 2029
Cost-Effectiveness Analysis: Nonresidential New Construction Buildings 4
Introduction
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-03-24
reach code mandatory requirements for covered appliances, in practice, builders may install any package of compliant
measures to achieve the performance requirements.
This study references the statewide reach code study performed in 2019 for new ly constructed nonresidential buildings
as a starting point for additional measure definitions. Importantly, the current 2022 cost-effectiveness report introduced
a new restaurant building type and updated the modeling and cost assumptions.
Page 1955 of 2029
Cost-Effectiveness Analysis: Nonresidential New Construction Buildings 5
Methodology and Assumptions
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-03-24
2 Methodology and Assumptions
The Reach Code Team analyzed four prototypes—Medium Office, Medium Retail, Quick-Service Restaurant, and
Small Hotel—using the cost-effectiveness methodology detailed in this section below.
2.1 Cost-effectiveness
This section describes the approach to calculating cost-effectiveness including benefits, costs, metrics, and utility rate
selection.
2.1.1 Benefits
This analysis used both On-Bill and time dependent valuation (TDV) of energy-based approaches to evaluate cost-
effectiveness. Both On-Bill and TDV require estimating and quantifying the energy savings and costs associated with
energy measures. The primary difference between On-Bill and TDV is how energy is valued:
▪ On-Bill: Customer-based lifecycle cost approach that values energy based upon estimated site energy usage
and customer On-Bill savings using electricity and natural gas utility rate schedules over a 15-year duration
accounting for a three percent discount rate and energy cost inflation per Appendix 8.2.
▪ TDV: TDV was developed by the Energy Commission to reflect the time dependent value of energy, including
long-term projected costs of energy such as the cost of providing energy during peak periods of demand and
other societal costs including projected costs for carbon emissions and grid transmission impacts. This metric
values energy uses differently depending on the fuel source (gas, electricity, and propane), time of day, and
season. Electricity used (or saved) during peak periods has a much higher value than electricity used (or
saved) during off-peak periods. This refers to the “Total TDV” that includes all the energy end uses such as
space-conditioning, mechanical ventilation, service water heating indoor lighting, photovoltaic (PV) and battery
storage systems, and covered process loads.
2.1.2 Costs
The Reach Code Team assessed the incremental costs and savings of the energy packages over a 15 year lifecycle.
Incremental costs represent the equipment, installation, replacements, and maintenance costs of the proposed
measure relative to the 2022 Title 24 standards minimum requirements or standard industry practices. The Reach
Code Team obtained baseline and measure costs from manufacturer distributors, contractors, literature review, and
online sources such as RS Means.
For heating, ventilation, and air conditioning (HVAC) and water heating baseline and measure costs, including gas and
electrical infrastructure, the Reach Code Team contracted two different firms, one mechanical contractor (Western
Allied Mechanical, based in Menlo Park) and one mechanical designer (P2S Engineering, based in Irvine) to provide
cost data. The Reach Code Team developed a basis of design for all prototypes described in section 3.1 and worked
with the mechanical contractor and designer to get cost estimates. The Reach Code Team determined HVAC design
heating and cooling loads and capacities by climate zone from the energy models. For each HVAC system type, the
Reach Code Team requested costs for the smallest capacity unit required and the largest capacity unit required and
specified federal minimum equipment efficiency.
The mechanical contractor and mechanical designer collected equipment costs and labor assumptions from their
vendors and manufacturers’ representatives, as well as through their own recent projects. The mechanical contractor
and designer provided material and labor cost estimates for the entire HVAC and DHW systems, disaggregated by the
HVAC and DHW equipment itself; refrigerant piping; structural; electrical supply; gas supply; controls; commissioning
and startup; general conditions and overhead; design and engineering; permit, te sting, and inspection; and a contractor
profit or market factor. The mechanical contractor and designer provided costs for each of the system capacities,
based on which the Reach Code Team developed a relationship between HVAC system capacity and cost to calculate
the cost for each building in each climate zone. In most cases, the analysis uses the average of the costs provided by
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Cost-Effectiveness Analysis: Nonresidential New Construction Buildings 6
Methodology and Assumptions
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-03-24
the contractor and the costs provided by the designer. In some limited cases where costs provided by one source were
unlikely to be representative of the measure, costs from only the other source were used. The Reach Code Team
added taxes, contractor markups, maintenance costs, and replacement costs where needed, and adjusted material
and labor costs for each climate zone based on weighting factors from RS Means (presented in Appendix 8.3).
Actual project costs vary widely based on a range of real-building considerations. The costs that the Reach Code Team
determined through contractors are likely costs for the given prototypes and are not representative of all projects.
2.1.3 Metrics
Cost-effectiveness is presented using net present value (NPV) and benefit-to-cost (B/C) ratio metrics.
▪ NPV: Net savings (NPV benefits minus NPV costs). If the net savings of a measure or package is positive over
a lifetime of 15 years, it is considered cost-effective. Negative net savings represent net costs to the consumer.
A measure that has negative energy cost benefits (energy cost increase) can still be cost-effective if the
incremental costs to implement the measure (i.e., construction and maintenance cost savings) outweigh the
negative energy cost impacts.
▪ B/C Ratio: Ratio of the present value of all benefits to the present value of all costs over 15 years (NPV
benefits divided by NPV costs). The criterion for cost-effectiveness is a B/C greater than 1.0. A value of one
indicates the savings over the life of the measure are equivalent to the incremental cost of that measure. A
value greater than one represents a positive return on investment.
Improving the energy performance of a building often requires an initial capital investment, though in some cases an
energy measure may be cost neutral or have a lower cost. In most cases the benefit is represented by annual On-Bill
utility or TDV savings and the cost by incremental first cost and replacement costs. In cases where both construction
costs and energy-related savings are negative, the construction cost savings are treated as the benefit while the
increased energy costs are the cost.
In cases where a measure or package is cost-effective immediately (i.e., shows positive upfront construction cost
savings and lifetime energy cost savings), B/C ratio cost -effectiveness is represented by “>1”. Because of these
situations, NPV savings are also reported, which, in these cases, are positive values.
2.1.4 Utility Rates
In coordination with the IOU and POU rate teams the Reach Code Team determined appropriate utility rates for each
CZ and package as of October 2022. The utility tariffs, summarized in Table 1, were determined based on the annual
load profile of each prototype and the corresponding package, the most prevalent rate in each utility territory, and
information indicating that the rates were unlikely to be phased out during the code cycle.
A time-of-use (TOU) rate was applied to most cases, some POUs may not have TOU rates. In addition to energy
consumption charges, there are kW demand charges for monthly peak loads. Utilities calculate the peak load by the
highest kW of the 15-minute interval readings in the month. However, the energy modeling software pro duces results
on hourly intervals; hence, the Team calculated the demand charges by multiplying the highest load of all hourly loads
in a month with the corresponding demand charge per kW. The utility rates applicable to a prototype may vary by
package and CZ especially between a mixed fuel and all-electric package if the monthly peak demand loads exceed
the applicable threshold.
The Reach Code Team coordinated with utilities to select tariffs for each prototype given the annual energy demand
profile of each specific prototype, climate zone, and measure package and the most prevalent rates in each utility
territory. The Reach Code Team did not compare a variety of tariffs to determine their impact on cost-effectiveness.
Utility rate updates can affect cost-effectiveness results. For a more detailed breakdown of the rates selected, refer to
Appendix 8.2.
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For packages with PV generation, the approved Net Energy Metering (NEM) 2.0 tariffs were applied along with
minimum daily use billing and mandatory non-bypassable charges. For the PV cases, annual electric production was
always less than the modeled annual electricity consumption; therefore, no credits for surplus generation were
necessary.
The analysis assumes that utility rates escalate over time for commercial buildings, as described in Appendix 8.2.
Escalation rates above inflation for electric ity beyond 2023 are assumed to be between 0.2% and 0.7%, before
dropping to a steady 0.6% escalation per year in 2030. Natural gas is assumed to escalate at a relatively higher rate,
peaking at 7.7% in 2024, then escalating more slowly to a rate of approximately 2% in the latter years of the analysis
period.
Table 1. Utility Tariffs Used Based on CZ (October 2022)
CZs Electric / Gas Utility Electricity Natural Gas
Investor-Owned Utilities
1-5,11-13,16 Pacific Gas & Electric Company (PG&E) B-1 / B-10 G-NR1
6, 8-10, 14,
15
Southern California Edison (SCE) / Southern
California Gas (SCG)
TOU-GS-1 / TOU-GS-2
/TOU-GS-3 G-10 (GN-10)
7, 10, 14 San Diego Gas and Electric Company (SDG&E) AL-TOU + EECC (AL-TOU)
GN-3
Publicly Owned Utilities
4 City of Palo Alto Utilities (CPAU) E-2 G-2
12 Sacramento Municipal Utilities District (SMUD) CI-TOD 1 (CITS-0 /CITS-1) G-NR1
2.2 Energy Simulations
The Reach Code Team performed energy simulations using California’s Building Energy Code Compliance Software
CBECC 2022.1.0 (1250) with ruleset version BEMCmpMgr 2022.1.0 (7361) (California Building Energy Code
Compliance 2022).2 This is the first 2022 Title 24 code compliance software approved by Energy Commission for
compliance of nonresidential buildings on June 8, 2022. The CBECC software combined the capabilities of CBECC-
Com and CBECC-Res software into one to model both nonresidential and multifamily building prototypes in one
interface.
The Reach Code Team set up parametric simulations using Modelkit software to run thousands of measure packages
for each prototype in all California’s CZs. Individual measures were simulated separately and combined into cost-
effective measure packages for each CZ. Where necessary, the Reach Code Team employed minor ruleset changes,
such as load flexibility measures that alter thermostat setpoint schedules, to improve the cost-effectiveness of measure
packages. While these measures produce operational savings, they may not be used to achieve code compliance
without further software upgrades.
2.3 2022 T24 Compliance Metrics
2022 Title 24 Section 140.1 defines the energy budget of the building based on source energy and TDV energy for
space-conditioning, indoor lighting, mechanical ventilation, photovoltaic (PV) and battery storage systems , and service
2 Prior to the CBECC software, the Reach Code Team used CBECC-Com 2022 and CBECC 2022.0.8 Beta to model nonresidential
prototypes for the 2022 reach code analysis. The Reach Code Team noted the changes in results due to updates in functionalities
and standard design assumptions.
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water heating and covered process loads. CEC has introduced two new compliance metrics in addition to Total
Compliance TDV Margin for 2022 code cycle. A building needs to comply with all three compliance metrics below:
▪ Efficiency TDV. Efficiency TDV accounts for all regulated end-uses but does not include the impacts of PV
and battery storage.
▪ Total TDV. Total TDV Compliance metric includes regulated end-uses accounting for PV and battery storage
contributions.
▪ Source Energy. Source energy is based on fuel used for power generation, assuming utilities meet all
Renewable Portfolio Standard (RPS) goals and other obligations projected over 15-year lifecycle.
2.4 GHG Emissions
The analysis uses the GHG emissions estimates built into CBECC. The GHG emission multipliers were developed by
Energy + Environmental Economics (E3) to support development of compliance metrics for use in the 2022 California
energy code (E3 2021). There are 8,760 hourly multipliers accounting for time dependent energy use and carbon
emissions based on source emissions, including RPS projections. For the 2022 code cycle, the multipliers incorporate
GHG from methane and refrigerant leakage, which are two significant sources of GHG emissions (NORESCO 2020).
There are 32 strings of multipliers, with a different string for each California CZ and each fuel type (metric tons of CO2
per kWh for electricity and metric tons of CO2 per therm for natural gas).
2.5 Limitations and Further Considerations
The Team encountered some modeling limitations, outside of the Team’s control that should be noted while using
these results to inform reach code policies,
▪ CBECC Software:
• The Reach Code Team coordinated with the CBECC software development team on potential
differences in our understanding of 2022 code requirements and its i mplementation in standard design
such as battery controls. The version of 2022 CBECC software v1.0, described in Section 2.2,
available to the Reach Code Team at the time of the analysis has limited functionalities and could not
model heat pump hydronic system or other measures like drain water heat recovery. As the software
evolves, some results may look different.
• The most likely all-electric replacement for a central gas boiler serving a variable air volume reheat
system would be a central heat pump boiler; however, this system cannot be modeled in CBECC at
the time of the writing of this report. The Reach Code Team is treating this analysis as temporary until
a compliance pathway is established for a central heat pump boiler in the Energy Code and results can
be updated accordingly.
• The team identified some apparent anomalies in software-reported compliance margins when they
became available in June 2022. The Reach Code Team is in the midst of discussing outputs and
ramifications with software development team specifically related to ventilation such as fan power and
heat recovery, among other modeling methods. Results may change with future software versions. In
the interim, the Reach Code Team manually calculated the compliance margins using the mixed fuel
baseline model created in this study based on our best understanding .
▪ Prototype Building: The cost-effectiveness analysis is based on standard prototypical buildings, which may
differ from actual buildings being constructed. Jurisdictions should keep this in mind while extrapolating to the
buildings in their territory.
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▪ System Cost Assumptions: The incremental electrification and additional measure costs are based on
specific system selection and assumptions made by experienced professionals. These costs can vary based
on contractor, system design and specifications, and regional variation.
The Team will re-evaluate packages with central heat pump boiler system in Medium Office and Small Hotel in early
2023. In addition to the packages assessed in the report, there are other future potential enhancements that can be
considered for more cost-effective or compliant packages:
▪ Adding more solar PV than already analyzed if the building has more roof space to accommodate.
▪ Adding battery at higher levels than prescriptively required in 2022 Title 24 with more advanced controls.
▪ Adding energy efficiency measures as software capability evolves such as drain water heat recovery.
▪ Applying federally pre-emptive (high) efficiency energy systems or appliances.
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3 Prototypes, Measure Packages, and Costs
This section describes the prototype characteristics and the scope of analysis including measures and their
corresponding costs. The Reach Code Team used versions of the following four DOE building prototypes to evaluate
cost-effectiveness of measure packages in the occupancy types listed below:
▪ Medium Office
▪ Medium Retail
▪ Quick-Service Restaurant (QSR)
▪ Small Hotel
The Reach Code Team designed the baseline prototypes to be mixed fuel based on 2022 Title 24 Final Express Terms
requirements. The Reach Code Team reviewed the 2022 T24 ACM HVAC system map to ensure alignment as
applicable for most cases, differences if any are discussed in subsequent sections. The Team built new construction
prototypes to have compliance margins as close to zero as possible to reflect a prescriptively compliant new
construction building in each CZ. The code compliance is based on the first publicly available CBECC v1.0 compliance
software as described in Section 2.2. Misalignments have been reported back to the software team for future software
iterations, as described in Section 2.5.
3.1 Prototype Characteristics
The DOE provides building prototype models which, when modified to comply with 2022 Title 24 requirements, can be
used to evaluate the cost-effectiveness of efficiency measures (U.S. Department of Energy 2022 A). These prototypes
have historically been used by the En ergy Commission to assess potential code enhancements. The selection of four
building types for this analysis is based on the priority suggested by a group of California cities. The cost-effectiveness
results of this study could potentially be extrapolated to other building types that have similar properties such as
occupancy pattern, HVAC design and layout.
Water heating includes both service hot water (SHW) for office and retail buildings and domestic hot water for hotel
guest rooms. In this report, water heating or SHW is used to refer to both. The compliance software assumes a
Standard Design, where HVAC and SHW systems are based on the system maps included in 2022 Nonresidential
ACM Reference Manual. However, the Reach Code Team applied both 2022 Title 24 prescriptive requirements and
2022 ACM system map for baseline mixed fuel model, HVAC and SHW system characteristics as described below.
▪ Medium Office
• The HVAC design is a variable air volume (VAV) reheat system with two gas hot water boilers, three
packaged rooftop units (one serving each floor), and VAV terminal units with hot water reheat coils.
• The SHW design includes one 8.7 kW electric resistance hot water heater with a 5-gallon storage tank.
▪ Medium Retail
• For CZs 2 to 15, the 2022 Title 24 ACM System Map Standard Design informed the baseline model to
have three packaged Single Zone Heat Pump (SZHP) systems for the smaller capacity (<240 kBtuh)
thermal zones, in alignment with 2022 Title 24 prescriptive code requirements.3 The large (>240 kBtuh)
core thermal zone has two smaller (<240 kBtuh) SZHPs with VAV fans instead of one large SZHP,
since larger rooftop packaged heat pumps are not available in the market. The 2022 Title24 ACM
Standard Design assumes a large SZHP for larger zones as well, however this deviation does not
impact the results considerably.3
3 https://www.energy.ca.gov/publications/2022/2022 -nonresidential-and-multifamily-alternative-calculation-method-reference
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• For CZs 1 and 16, the baseline model assumed all-electric packaged single zone heat pumps similar
to CZs 2-15. The assumption deviates from 2022 Title24 ACM System Map that suggests a single
zone dual fuel heat pump. Presumably this will not impact results significantly because the dual fuel
system will be in heat-pump mode most times.
• The SHW design includes one 8.7 kW electric resistance hot water heater with a 5-gallon storage tank.
▪ Quick-Service Restaurant
• HVAC includes two SZAC (VAV or constant volume, depending on capacity) with gas furnace, one for
kitchen and another for dining area. An exhaust fan is applied for kitchens in all climates based on
prescriptive requirements in 2022 Title 24 code.
• The SHW design includes a gas storage water heater with a 100-gallon storage tank.
▪ Small Hotel
• The nonresidential HVAC design is a VAV reheat system with two gas hot water boilers, four packaged
rooftop units (one serving each floor), and VAV terminal units with hot water reheat coils. The SHW
design includes a small electric resistance water heater with 30-gallon storage tank.
• The guest room HVAC design includes one packaged SZAC unit with gas furnace serving each guest
room. The water heating design includes a central gas water heater with a 250-gallon storage tank and
recirculation pump, serving all guest rooms.
Table 2 summarizes the baseline mixed-fuel prototype characteristics, based on prescriptive 2022 Title 24 new
construction requirements.
Table 2. Baseline Prototype Characteristics
Medium Office
Medium Retail
Quick-Service Restaurant
Small Hotel
Conditioned floor
area (ft2) 53,628 24,563 2,501
42,554
(77 guest rooms)
(Nonresidential area:
15,282 (36%))
Number of stories 3 1 1 4
Window-to-Wall
Area ratio 0.33 0.07 0.11 0.14
Window U-
factor/SHGC
U-factor:
CZ 1-8, 10, 16 – 0.36
CZ 9, 11-15 – 0.34
SHGC:
CZ 1-8, 10, 16 – 0.25
CZ 9, 11-15 – 0.22
U-factor:
CZ 1-8, 10, 16 – 0.36
CZ 9, 11-15 – 0.34
SHGC:
CZ 1-8, 10, 16 – 0.25
CZ 9, 11-15 – 0.22
U-factor:
CZ 1-8, 10, 16 – 0.36
CZ 9, 11-15 – 0.34
SHGC:
CZ 1-8, 10, 16 – 0.25
CZ 9, 11-15 – 0.22
Nonresidential:
U-factor:
CZ 1-8,10,16 – 0.36
CZ 9, 11-15 –0.34
SHGC:
CZ 1-8,10,16 – 0.25
CZ 9, 11-15 – 0.22
Guest Rooms:
U-factor: 0.36
SHGC: 0.25
Solar PV size 123 kW – 204 kW
Depending on CZ
64 kW – 87 kW
Depending on CZ None 17 kW – 25 kW
Depending on CZ
Battery Storage 217 kWh – 360 kWh
Depending on CZ
70 kWh – 94 kWh
Depending on CZ None 16 kWh – 24 kWh
Depending on CZ
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Medium Office
Medium Retail
Quick-Service Restaurant
Small Hotel
HVAC System
VAV reheat system with
packaged rooftop units,
gas boilers, VAV terminal
units with hot water
reheat
CZ 1
Heat recovery for Core
Retail space only
< 65 kBtu/h: SZHP
> 65 kBtu/h and < 240
kBtu/h: SZHP VAV
> 240 kBtu/h: SZHP VAV
< 65 kBtu/h:
SZAC + gas furnace
> 65 kBtu/h:
SZAC VAV
Nonresidential and Laundry:
VAV reheat system with
packaged rooftop units, gas
boilers, VAV terminal units with
hot water reheat
Guest Rooms: SZAC with gas
furnaces
SHW System 5-gallon electric resistance
water heater
5-gallon electric resistance
water heater
100-gallon gas water
heater
Nonresidential: 30-gallon
electric resistance water heater
Laundry Room: 120-gal gas
storage water heater
Guest rooms: Central gas water
heater, 250 gallons storage,
recirculation loop
3.2 Measure Definitions and Costs
The measures evaluated in the analysis fall into four different categories:
Fuel Substitution
▪ Heat pump or electric
space heating or gas
furnace
▪ Heat pump or electric
water heaters
▪ Electric cooking
▪ Electric clothes dryer
▪ Electrical panel capacity
▪ Natural gas infrastructure
Energy Efficiency
▪ Envelope
▪ Mechanical equipment
(HVAC and SHW)
▪ Lighting
Load Flexibility
▪ Peak Load
shedding
▪ Load shift
Additional solar PV
and/or battery
storage.
These measures are detailed further in this section.
3.2.1 Fuel Substitution
The Reach Code Team investigated the cost and performance impacts and associated infrastructure costs associated
with changing the mixed-fuel baseline HVAC and water heating systems to all-electric equipment for all prototypes
except Medium Retail where the baseline is already an all-electric design.
For Medium Office, Quick Service Restaurant and Small Hotel, the fuel substitution measure entails electrification
including heat pump space heating, electric resistance re-heat coils, electric water heaters with storage tank, heat
pump water heating, increasing electrical capacity, and eliminating natural gas connections that would have been
present in mixed-fuel new construction.
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For Medium Retail with all-electric baseline, the fuel substitution measure entails mixed-fuel space conditioning system
including single zone packaged AC with gas furnace, dual fuel heat pump, adding gas infrastructure costs and
eliminating any additional electric infrastructure.
3.2.1.1 HVAC and Water Heating
The 2022 T24 nonresidential standards analysis uses a mixed-fuel baseline for most of the Standard Design
mechanical equipment, primarily gas for space heating, except for some heat pump scenarios in Retail prototype (see
Table 2). Quick-Service Restaurant has a gas storage water heater in baseline, and heat pump water heater in all-
electric scenario. The Small Hotel has a central gas water heating system serving the guest rooms and a separate gas
storage water heater for laundry room. In the all-electric scenario, gas equipment serving HVAC and water heating
end-uses is replaced with electric equipment. Full details of HVAC and water heating systems in baseline and
proposed fuel substitution measure package are described in Table 3.
Regions of California covered by the South Coast Air Quality Management District have emissions restrictions imposed
on mechanical equipment. The Reach Code Team investigated the potential cost implications of meeting these
requirements for gas furnaces and boilers but found that costs are minimal for mechanical systems under 2,000,000
Btu/h, and therefore did not include them. All gas-fired mechanical systems in this study are under 2,000,000 Btu/h and
are subject to only an initial permitting fee, while larger systems require additional permitting costs and annual
renewals.
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Table 3. HVAC and Water Heating Characteristics Summary
Medium Office
Medium Retail
Quick-Service
Restaurant
Small Hotel
HVAC
Baseline
Packaged DX +
VAV with hot
water reheat.
Central gas
boilers.
All zones and CZs: Single
zone packaged heat
pumps
Packaged SZAC +
gas furnace
Nonresidential: Packaged DX
+ VAV with hot water
reheat. Central gas boilers.
Guest Rooms: Packaged
SZAC +
gas furnaces
Proposed – Fuel
Substitution
Packaged DX +
VAV with electric
resistance reheat.
Core zone (>30 ton):
Packaged SZAC + VAV +
gas furnace
Other small zones: SZHP,
or dual fuel heat pump
for CZ 1 and 16
Single zone packaged
heat pumps
Nonresidential: Packaged DX
+ VAV with electric
resistance reheat
Guest Rooms: SZHPs
SHW
Baseline
Electric resistance
with storage
Electric resistance with
storage
Gas storage water
heater
Nonresidential: Electric
resistance storage
Guest Rooms: Central gas
storage with recirculation
Proposed – Fuel
Substitution
Unitary heat pump
water heater
Nonresidential: Electric
resistance storage
Guest Rooms: Central heat
pump water heater with
recirculation
The Reach Code Team received cost data for mechanical equipment from two experienced mechanical design firms
including equipment and material, labor, subcontractors (for example, HVAC and SHW control systems), and
contractor overhead.
3.2.1.1.1 Medium Office
For the Medium Office all-electric HVAC design, the Reach Code Team investigated several potential all-electric
design options, including variable refrigerant flow, packaged heat pumps, and variable volume and temperature
systems. The most likely all-electric replacement for a central gas boiler serving a variable air volume reheat system
would be a central heat pump boiler; however, this system cannot be modeled in CBECC at the time of writing of this
report. As such, Reach Code Team is treating this analysis as temporary until a compliance pathway is established for
a central heat pump boiler in the Energy Code and results can be updated accordingly. This modeling capability is
anticipated by Q1 2023 according to discussions with the CBECC software development team, and the cost-
effectiveness analysis should become available in the first half of 2023.
After seeking feedback from the design community and considering the software modeling constraints, the Reach
Code Team determined that the most feasible all-electric HVAC system is a VAV system with an electric resistance
reheat instead of hot water reheat coil. A parallel fan-powered box (PFPB) implementation of electric resistance reheat
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would further improve efficiency due to reducing ventilation requirements, but an accurate implementation of PFPBs is
not currently available in compliance software.
The actual gas consumption for the VAV hot water reheat baseline may be higher than the current simulation results
due to a combination of boiler and hot water distribution losses. A recent research study shows that the total losses can
account for as high as 80 percent of the boiler energy use.4 If these losses are considered savings for the electric
resistance reheat (which has zero associated distribution loss), cost-effectiveness may be higher than presented.
The all-electric SHW system remains the same electric resistance water heater as the baseline and has no associated
incremental costs. Cost data for Medium Office designs are presented in Table 4. The all-electric HVAC system
presents cost savings compared to the hot water reheat system from elimination of the hot water boiler and associated
hot water piping distribution. CZ10 and CZ15 all-electric design costs are slightly higher because they require larger
size rooftop heat pumps than the other CZs.
Table 4. Medium Office Average Mechanical System Costs
Components (HVAC Only)
Baseline – Mixed Fuel
Proposed – All-electric Incremental Cost
Description
Packaged units, boilers,
hot water piping, VAV
boxes, ductwork, grilles
Packaged units, electric
resistance VAV boxes,
electric circuitry,
ductwork, grilles
VAV Boxes, electric
infrastructure
Material $491,630 $438,555 $(53,075)
Labor $173,816 $102,120 $(71,696)
Electric Infrastructure $0 $112,340 $112,340
Gas Infrastructure $17,895 $0 $(17,895)
Overhead & CZ adjustment ** $267,052 $250,114 $(16,938)
TOTAL $950,393 $903,129 $(47,264)
** The overhead and CZ adjustment factors are presented in Section 8.3.
3.2.1.1.2 Medium Retail
The baseline HVAC system includes five packaged single zone heat pumps. Based on fan control requirements in
Section 140.4(m), units with cooling capacity ≥ 65,000 Btu/h have variable air volume fans, while smaller units have
constant volume fans. For the Medium Retail proposed fuel substitution scenario, the Reach Code Team assumed one
large Single Zone Packaged ACs with gas furnaces to replace the two smaller packaged heat pumps in the large core
thermal zone. The all-electric SHW system remains the same electric resistance water heater as the baseline and has
no associated incremental costs. In addition, according to the prescriptive requirement in Section 140.4 (q), the air
system of Core Retail Zone in CZ1 meets the requirement in Table 140.4 J, which should include exhaust air heat
recovery. Cost data for Medium Retail designs are presented in Table 5. Costs for rooftop air-conditioning systems are
very similar to rooftop heat pump systems.
4 Raftery, P., A. Geronazzo, H. Cheng, and G. Paliaga. 2018. Quantifying energy losses in hot water reheat systems. Energy and
Buildings, 179: 183-199. November. https://doi.org/10.1016/j.enbuild.2018.09.020. Retrieved from
https://escholarship.org/uc/item/3qs8f8qx
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For climate zones 2 to 15, the proposed fuel substitution HVAC design includes three SZHP units (VAV or constant
volume, depending on capacity) based on prescriptive requirements and one large SZAC that is between 35-45 tons
for the core zone.
For climate zones 1 and 16, the smaller capacity (<240 kBtuh) thermal zones may have either of dual-fuel SZHPs or
SZACs, depending on capacity. The core zone with 35-to-45-ton cooling capacity is assumed to have one large SZAC.
CZ 1 also assumes an exhaust air heat recovery system for core zone based on prescriptive requirement in Title 24
Part 6 Section 140.4.
Table 5. Medium Retail Average Mechanical System Costs
Components (HVAC
Only)
Baseline – All-electric
Proposed – Mixed Fuel Incremental Cost
Description SZHPs
Single zone AC +
furnace, SZHP, or dual
fuel SZHP, depending
upon capacity and CZ
SZAC with gas furnace,
Added gas
infrastructure cost
HVAC – Material $189,160 $183,157 $(6,003)
HVAC – Labor $54,785 $52,886 $(1,899)
Electric Infrastructure $0 $0 -
Gas Infrastructure $0 $17,895 $17,895
Overhead & CZ
adjustment **
$94,600 $98,519 $3,919
TOTAL $338,546 $352,458 $13,912
** The overhead and CZ adjustment factors are presented in Section 8.3.
3.2.1.1.3 Quick-Service Restaurant
The baseline HVAC system includes two packaged single zone rooftop ACs with gas furnaces . Based on fan control
requirements in Section 140.4(m), units with cooling capacity ≥ 65,000 Btu/h have variable air volume fans, while
smaller units have constant volume fans. The SHW design includes one central gas storage water heater with 150
kBtu/h input capacity and a 100-gallon storage tank. For the QSR all-electric design, the Reach Code Team assumed
packaged heat pumps and an A.O. Smith CHP-120 heat pump water heater with a 120-gallon storage tank. Cost data
for the QSR designs are presented in Table 6, which shows the costs for full electrification of the HVAC and water
heating equipment.
The Team has not included costs of electrifying the cooking equipment because of the negative impact on cost-
effectiveness, as demonstrated in a 2021 Restaurants cost-effectiveness study (TRC, P2S Engineers, and Western
Allied Mechanical 2022). The HVAC and SHW electrification packages are referred to as the HS package to reflect all-
electric HVAC and SHW.
Table 6. Quick-Service Restaurant Average Mechanical System Costs - HS Package
Components
Baseline – Mixed Fuel
Proposed – All-electric Incremental Cost
Description Single zone AC + furnace, gas
storage water heater
SZHP, heat pump water
heater
HVAC +SHW
electrification
HVAC Material $50,065 $52,785 $2,719
HVAC Labor $6,748 $6,249 $(499)
SHW – Material $10,198 $13,720 $3,523
SHW – Labor $2,650 $2,529 $(121)
Electric Infrastructure $0 $12,960 $12,960
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Gas Infrastructure $17,895 $15,878 -$2,017
Overhead & CZ adjustment ** $41,633 $47,612 $5,979
TOTAL $150,838 $173,382 $22,544
** The overhead and CZ adjustment factors are presented in Section 8.3.
3.2.1.1.4 Small Hotel
The Small Hotel has two different baseline equipment systems, one for the nonresidential spaces and one for the guest
rooms. The nonresidential HVAC system includes two gas hot water boilers, four packaged rooftop units, and twenty-
eight VAV terminal boxes with hot water reheat coil. The SHW design includes a small electric water heater with
storage tank for nonresidential areas and gas storage water heater dedicated to laundry room. The guest rooms HVAC
design includes one single-zone AC unit with gas furnace for each guest room, and the water heating design includes
one central gas storage water heater with a recirculation pump for all guest rooms.
For the Small Hotel all-electric design, the Reach Code Team assumed the nonresidential HVAC system to be
packaged heat pumps with electric resistance VAV terminal units, and the SHW system will remain a small electric
resistance water heater. As described in Section 3.2.1.1.1 above, a central heat pump boiler may be the most
commonly employed system type but was not evaluated in this study because of modeling limitations. For the guest
room all-electric HVAC system, the Team assumed SZHPs and a central heat pump water heater serving all guest
rooms. For the laundry room, all-electric HVAC system is same as other nonresidential areas and all-electric water
heating is a split heat pump water heater. The central heat pump water heater includes a temperature maintenance
loop with an electric resistance backup heater.
Cost data for Small Hotel designs are presented in Table 7. The all-electric design presents substantial cost savings
because there is no hot water plant or piping distribution system serving the nonresidential spaces. The incremental
cost savings are further enhanced considerably if packaged terminal heat pumps (PTHPs) are used instead of SZHPs
in guest rooms compared to split DX/furnace systems with individual flues.
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Table 7. Small Hotel HVAC and Water Heating System Costs
Components
Baseline – Mixed Fuel
Proposed – All-electric Incremental Cost
Description
Non-residential spaces: Packaged
units, boilers, hot water piping,
VAV boxes, ductwork, grilles, gas
water heater for laundry
Guest rooms: SZAC + furnace,
central gas water heater
Non-residential spaces:
Packaged units, electric
resistance VAV boxes, electric
circuitry, ductwork, grilles, heat
pump water heater for laundry
Guest rooms: SZHP, central
heat pump water heater
HVAC (NR and Guest Rooms)
Electrification
SHW (Laundry Room and
Guest Rooms)
HVAC - Material $802,004 $625,642 $(176,361)
HVAC - Labor $366,733 $282,394 $(84,339)
SHW - Material $55,829 $139,087 $83,258
SHW - Labor $11,780 $15,080 $3,300
Electric
Infrastructure
$- $119,625 $119,625
Gas Infrastructure $74,943 $- $(74,943)
Overhead & CZ
adjustment **
$518,741 $461,001 $(57,739)
TOTAL $1,830,029 $1,642,830 $(187,199)
TOTAL
HVAC (PTHP option) $1,830,029 $1,161,178 ($668,851)
** The overhead and CZ adjustment factors are presented in 8.3.
3.2.1.2 Commercial Cooking Equipment
For Quick-Service Restaurant prototype, the Reach Code Team evaluated electrification of commercial cooking
equipment extensively in 2019 Restaurants Cost Effectiveness analysis and leveraged it for cost and other
specifications for the this study. It assumes a Type I exhaust hood and shows high incremental cost affecting the cost-
effectiveness of this measure. Table 8 summarizes the quick-service restaurant cooking equipment costs for both
mixed-fuel and all-electric scenarios.
Table 8. Quick-Service Restaurant Cooking Equipment Costs
Components
Baseline – Mixed Fuel
Proposed – All-electric (non
“HS” scenario) Incremental Cost
Description Gas based appliances Electric cooking appliance Cooking appliance
electrification
Cooking equipment
cost
$21,649 $43,534 $21,886
TOTAL $21,649 $43,534 $21,886
This measure also adds electric infrastructure cost as detailed in Table 10 below.
3.2.1.3 Commercial Clothes Dryer
For the all-electric measure, the Reach Code Team assumed electric resistance clothes dryers for Small Hotel
prototype. Commercial-scale heat pump clothes dryers take significantly longer time to dry compared to a conventional
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gas or electric dryer and are not common in the United States On-Premise Laundry (OPL) market, where labor is
relatively expensive and use of heat pump dryers implies hotels may need to require more than one shift to perform
laundry duties. Most commercial clothes dryers are available in models that use either gas or electricity as the fuel
source, so there is negligible incremental cost for electric resistance dryers. Table 9 summarizes the Small Hotel
construction costs for both mixed-fuel and all-electric OPL scenarios.
Table 9. Small Hotel Clothes Dryer Costs
Components
Baseline – Mixed Fuel
Proposed – All-electric Incremental Cost
Description Gas clothes dryer Electric resistance clothes
dryer -
Clothes Dryer cost $29,342 $29,342 $0
TOTAL $29,342 $29,342 $(0)
This measure also adds electric infrastructure cost as detailed in Table 10 below.
3.2.1.4 Infrastructure Impacts
3.2.1.4.1 Electrical infrastructure
Electric heating appliances and equipment often require a larger electrical connection than an equivalent gas appliance
because of the higher voltage and amperage necessary to electrically generate heat. Thus, many buildings may
require larger electrical capacity than a comparable building with natural gas appliances. This includes:
▪ Electric resistance VAV space heating in the medium office and common area spaces of the small hotel.
▪ Heat pump water heating for the guest room spaces of the small hotel.
Table 10 details the cost impact of additional electrical panel sizing and wiring required for all-electric scenarios as
compared to their corresponding mixed-fuel scenario The costs are based on estimates from one contractor. The
Reach Code Team excluded costs associated with electrical service connection upgrades because these costs are
very often rate-based and highly complex.
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Table 10. Electrical Infrastructure Costs
Mixed-Fuel Equipment All-electric Equipment Electrical Infrastructure
Impact
Incremental
Cost
Medium
Office
Hot water reheat system
with gas boiler plant and
VAV boxes with hot water
reheat coils
VAV boxes with electric
resistance reheat coils
Upgraded transformers,
transformer feeders,
switchboards, and branch
circuits
$ 112,340
Medium
Retail
Mix of SZHPs and single zone
AC plus furnace serving all
zones
SZHPs serving all zones Electrical requirements are
driven by cooling capacity,
so no impact.
$0
Quick-Service
Restaurant
Gas water heater Heat pump water heater Upgraded switchboard,
transformer feeder, and
branch circuits
$12,960
Gas Water heater, Gas
cooking
Heat pump water heater,
Electric cooking
Upgraded switchboard,
transformer feeder, and
branch circuits
$95,260
Small Hotel Guest rooms HVAC: Single
zone AC plus furnace
Non-residential spaces
HVAC: Hot water reheat
system with gas boiler plant
and VAV boxes with hot
water reheat coils.
Water heating: Gas water
heating serving both laundry
and guest rooms.
Process: Gas dryers.
Guest rooms HVAC: SZHPs
Non-residential spaces
HVAC: VAV boxes with
electric resistance reheat
coils.
Water heating: Heat pump
water heating serving both
laundry and guest rooms.
Process: Electric resistance
dryers.
Upgraded transformers,
transformer feeders,
switchboards, and branch
circuits
$119,625
3.2.1.4.2 Gas Piping
The Reach Code Team assumes that gas would not be supplied to the site in an all-electric new construction scenario.
Eliminating natural gas in new construction would save costs associated with connecting a service line from the street
main to the building, piping distribution within the building, and monthly connection charges by the utility.
The Reach Code Team determined that for a new construction building with natural gas piping, there is a service line
(branch connection) from the natural gas main to the building meter. Table 11 gives a summary of the gas
infrastructure costs by component, assuming 1-inch corrugated stainless-steel tubing (CSST) material is used for the
plumbing distribution. The Reach Code Team assumes that the gas meter costs vary depending on the gas load.
Based on typical space heating loads for all building types, the Reach Code Team categorized CZs 1 and 16 as ‘High-
load CZs’ and CZs 2-15 as ‘Low-load CZs’. The Reach Code Team assumed an interior plumbing distribution length
based on the expected layout. Table 12 gives the total gas infrastructure cost by building type. The costs are based on
estimates from one contractor.
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Table 11. Gas Infrastructure Costs by Component
Component Details Cost
Meter, including Pressure
Regulator, and Earthquake Valve
Low load CZ (CZ 2-15) $11,056
High load CZ (CZ 1,16) $15,756
Gas lateral Cost per linear foot of 1" CSST $40
Connection charges Includes street cut and plan review $1,015
Interior plumbing distribution Cost per linear foot of 1" CSST $40
Table 12. Total Gas Infrastructure Cost Estimates by Building Type
Total gas infrastructure cost
Building Prototype Interior plumbing distribution length (ft) Low load CZ High load CZ
Medium Office 100 $17,307 $22,007
Medium Retail 100 $17,307 $22,007
Quick-Service Restaurant 100 $2,017*
Small Hotel 1,412 $70,243 $74,943
*The Quick-Service Restaurant package includes gas cooking appliances , which will require a gas lateral and meter. These costs
represent only the interior plumbing distribution costs that would have served the HVAC and SHW systems.
3.2.2 Efficiency
The Reach Code Team started with a potential list of energy efficiency measures proposed for the 2025 Title 24 energy
code update by the Statewide Building Codes Advocacy program (CASE Team)5, which initially included over 500
options. Other options originated in previous energy code cycles or were drawn from other codes or standards
(examples: ASHRAE 90.1 and International Energy Conservation Code [IECC]), literature reviews, or expert
recommendations. The Reach Code Team leveraged the CASE Team's assessment tools for the 2025 Cycle, focusing
on measures prioritized by the CASE Team. The Reach Code Team filtered the list of potential measures based on
building type (to remove measures that applied to building types not covered in this study), measure category (to
remove end-uses and loads that are not relevant to the prototypes) and impacts to new construction. Based on this
filtering, the Team was left with around 100 measures to consider. The Reach Code Team ranked this list of potential
measures based on applicability to the prototypes in this study, ability to model in simulat ion software, demonstrated
energy savings potential, and market readiness .
Please note that the measures requiring a ruleset update cannot currently be modeled for compliance
purposes. The modeling method for each efficiency measure is defined in their respective measure descriptions in
Section 3.2.2.1 and if the ruleset amendment was applied. Please refer to Section 2.5 for further details.
The subsections below describe the energy efficiency measures that the Team analyzed, including description,
modeling approach, and specification.
3.2.2.1 Envelope
1. Cool Roof: Requires higher reflectance and emittance values for the Medium Office building only. This
measure was not shown to produce substantial savings in the other prototypes.
5 https://title24stakeholders.com/
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Modeling: Modeled cool roof measure in efficiency measures package by updating Aged Solar
Reflectance (ASR) and/or Thermal Emittance (TE) in CBECC software.
Specification: Increased ASR from 0.63 to 0.70 with a TE of 0.85 in CZs 4 and 6-15.
2. Efficient Vertical Fenestration: Requires lower U-factor and Solar Heat Gain Coefficient (SHGC) for windows
in select climate zones for three building types (Medium Office, Retail, and Small Hotel). The measure details
and the climate zone selection are based on the proposition of 2022 NR CASE Report (Statewide CASE Team
2020 B).
Modeling: Modeled high performance windows in efficiency measures package by updating U-factor and
SHGC inputs in CBECC software.
Specification: Reduced U-factor from 0.36 to 0.34 and SHGC from 0.25 to 0.22 in CZs 2, 6, 7 and 8 for
Medium Office and Retail, Reduced U-factor from 0.36 to 0.34 and SHGC from 0.25 to 0.22 in
all CZs for Small Hotel.
3. Vertical Fenestration as a Function of Orientation: Limit the amount of fenestration area as a function of
orientation for the Medium Office. East-facing and west-facing windows are each limited to one-half of the
average amount of north-facing and south-facing windows.
Modeling: Change z-coordinate input of windows in CBECC software for Medium Office to increase or
decrease fenestration area for the Medium Office.
Specification: Decreased east-facing and west-facing fenestration area from 468 to 390 square feet.
Increased north-facing and south-facing fenestration area from 703 to 781 square feet.
3.2.2.2 Mechanical Equipment (SHW and HVAC)
4. Water Efficient Fixtures in Kitchen: Specifies commercial dishwashers that use 20% less water than
ENERGY STAR® specifications. In addition, the dishwasher includes heat recovery function such that it only
needs connection to cold water and reduces hot water demand and central SHW system capacity. For QSRs,
which typically specify a three-compartment sink for dishwashing, this measure would replace or add a
dishwasher to reduce total hot water load. The measure also adds 1.0 gallon per minute (GPM) faucet aerators
to hand-washing sinks in the kitchen to reduce water usage. Title 20 requires kitchen sinks to have a flow rate
of 1.8 GPM at most. The reduced hot water load from the water efficient fixtures above allows the heat pump
water heater (HPWH) to operate without an electric resistance back-up.
Modeling: Reduced water usage in the ruleset based on calculations of expected water usage from
literature review and fixture specifications. HPWH coefficient of performance (COP) is
increased since there is no electric resistance back-up.
Specification: Decreased hot water usage by 26% in the software ruleset (13.4 gallons per person to 9.9
gallons per person) and increased HPWH COP from 3.1 to 4.2.
5. Ozone Washing Machines: Adds an ozone system to the large on-premises washing machines. The ozone
laundry system generates ozone, which helps clean fabrics by chemically reacting with soils in cold water. This
measure saves energy by reducing hot water usage and by reducing cycle time for laundry systems. Refer to
DEER Deemed measure SWAP005-01 for more information (California Public Utilites Commission 2022).
Modeling: Reduced the total runtime of each cycle and hot water hourly usage per person (gallons per
hour per person) for laundry area in software ruleset.
Specification: Reduced hot water usage by 85%, from 48.4 to 7.3 gal/hour-person based on the deemed
measure data from the California electronic Technical Reference Manual (California Technical
Forum 2022).
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6. Efficient Hot Water Distribution: Reduces domestic hot water (DHW) distribution system pipe heat losses in
two ways. First, the Team used pipe sizing requirements in Appendix M of the California Plumbing Code
instead of Appendix A. Appendix M reduces pipe diameters for the cold and hot water supply lines based on
advancements made in water efficiency standards for plumbing fixtures found in hotel bathrooms. Second, the
Team added more stringent pipe insulation thickness requirements for hotels to match that of single and
multifamily dwellings using Title 24 Table 160.4-A Pipe Insulation Thickness Requirements for Multifamily
DHW Systems instead of Table 120.3-A.
Modeling: The Team calculated the pipe heat loss savings for the Small Hotel prototype by following the
modelling methodology applied to the low-rise loaded corridor multi-family building prototype in
the 2022 CASE Multifamily Domestic Hot Water Distribution report (Statewide CASE Team
2020 A). The Team designed a riser distribution system for the Small Hotel prototype building
using the baseline Appendix A and modern Appendix M pipe sizing tables. The pipe design
and total pipe surface area of the supply and return lines for the Small Hotel closely matched
the Low-Rise Loader Corridor Building prototype. The hotel insulated pipe heat loss for both
Appendix A and M was approximated from the multifamily building heat loss modelling results
for the 16 CZs and water heater energy savings calculated for the two sub-measures.
Specification: (a) Pipe diameter decreased from Appendix A requirements to Appendix M multifamily
plumbing requirements (b) For pipe diameters at or above 1.5 inches, increase the insulation
thickness from 1.5 to two inches thick for fluids operating in the 105 -140⁰F temperature range.
. The Team reduced the DHW energy consumption by 0.4 – 0.7% depending on CZ in a post-
processing of the model.
7. Demand Control Ventilation (DCV) and Transfer Air: The California Energy Code requires kitchen exhaust
to have DCV if the exhaust rate is greater than 5,000 cfm. This measure expands this requirement and applies
DCV regardless of the exhaust rate for the QSR. Additionally, the kitchen makeup air supply is decreased by
requiring at least 15% of replacement air to come from the transfer air in the dining space that would otherwise
be exhausted.
Modeling: Changed exhaust fan from constant speed fan to variable speed and reduce kitchen
ventilation airflow rate for the QSR.
Specification: Changed Kitchen Exhaust Fan Control Method to Variable Flow Variable Speed Drive,
reduced kitchen ventilation from 2,730 cfm to 2,293 cfm.
8. Guest Room Ventilation and Fan Power: Uses the 2021 IECC fan power limitation requirements for
ventilation fans under 1/12 horsepower, and approximates the ASHRAE 90.1 Small Hotel guestroom control
requirements, which require shutting off ventilation within five minutes of all occupants leaving the room and
changing the cooling setpoint to at least 80⁰F and heating setpoint to at most 60⁰F.
Modeling: Since variable occupancy cannot be modeled in CBECC, the Reach Code Team revised the
software ruleset ventilation schedule and setpoints from 8:00 AM to 7:00 PM—the time range
where the CBECC software assumed occupancy to be less than half for all guestrooms.
Specification: Heating setpoint reduced from 68°F to 66°F, cooling setpoint increased from 78°F to 80°F PM,
and ventilation shut off from 8:00 AM to 7:00 PM. Guestroom ventilation fans have fan efficacy
of 0.263 W/cfm.
9. Variable speed Fans: Require variable speed fans at lower capacities than required by Title 24 Part 6 Section
140.4(m), currently at 65,000 Btu/hr. This measure is based on the 2022 Title 24 Part 6, Section 140.4(m),
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where direct expansion units greater than 65,000 Btu/hr that control the capacity of the mechanical cooling
directly shall have a minimum of two stages of mechanical cooling capacity and variable speed fan control.
Modeling: Reduced the cooling capacity threshold from 65,000 Btu/hr to 48,000 Btu/hr. Changed the
supply fan control from constant speed to variable speed for zones that have cooling capacity
> 48,000 Btu/hr and < 65,000 Btu/hr in the Medium Retail and QSR.
Specification: Changed the supply fan control from Constant Volume to Variable Speed Drive for the Front
Retail and Point-of-Sale thermal zones in Medium Retail prototype and the Dining Zone in the
QSR prototype.
3.2.2.3 Lighting
10. Interior lighting reduced lighting power density: Update lighting power densities (LPD, measured as
Watts/ft2) requirements based on technology advances (e.g., optical efficiency, thermal management, and
improved bandgap materials). Identify spaces with opportunities for more savings from lowered LPDs—not all
spaces are subject to LPD reductions. Take into consideration IES recommended practices and biological
effectiveness metrics (such as WELL) when developing the proposed LPD values (WELL 2022).
The 2022 Indoor Lighting CASE Study (Statewide CASE Team 2021 D) provided a survey of 2x2 troffer
products available in the Design Lights Consortium Qualified Products List (DLC -QPL) and the efficacy level
each measured. This study indicated that at the time of the report approximately 20% of available DLC -QPL
products exceeded the performance level of the ‘Standard’ DLC-QPL listing by approximately 15%, meeting
the ‘Premium’ listing criteria. The Title 24 2022 CASE Report uses the ‘Standard’ designation performance
level as the design baseline for all the LPD calculations in the code. This document proposes using the
‘Premium’ designation performance as the basis of the LPD allowances.
A DOE study on solid-state light sources (LEDs) provides projections of efficacy improvement for LED light
sources that are in the range of 2.5 to 3% per year, continuing for the next five or ten years (U.S. Department
of Energy 2019 B). So, the products offered for sale by the luminaire manufacturers are improving as older
products are discontinued and newer ones are introduced. Even in just three years, the overall performance of
the products available can improve by 7 to 9%.
A recent Navigant LED pricing study shows a slightly negative cost to efficacy correlation, indicating that higher
performing products may be slightly lower in cost (Navigant Consulting 2018). This is likely to be in part caused
by the decreasing cost of the LED chips with each subsequent generation produced. There is likely to be no
cost associated with employing higher performing LED luminaires.
Modeling: Reduce LPDs by approximately 13% in each space listed below under regulated lighting below
Title 24 prescriptive requirements.
Specification: Medium Office
• All spaces: 0.52 W/ft2
Medium Retail
• Storage: 0.36 W/ft2
• Retail sales: 0.86 W/ft2
• Main entry lobby: 0.63 W/ft2
QSR
• Dining: 0.41 W/ft2
• Kitchen: 0.86 W/ft2
Small Hotel
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Stairs: 0.54 W/ft2
Corridor: 0.36 W/ft2
Lounge: 0.50 W/ft2
The measures are summarized below by building type, including measure costs, in Table 13.
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Table 13. Efficiency Measures Applicability, Costs, and Sources
Measure Applicability
• Included in packages with energy efficiency measures
- Not Applicable
Measure
Baseline T24
Requirement Proposed Measure
Med
Office
Med
Retail
Quick-
Service
Restaurant
Small
Hotel:
Guest
Rooms
Small Hotel:
Nonresidential
Incremental
Cost Sources & Notes
Envelope
1. Cool Roof For low slope roofs:
ASR = 0.63
TE = 0.75
For low slope roofs:
ASR = 0.7
TE = 0.85 ● ─ ─ ─ ─ $0.04/ft2
Final Nonresidential High
Performance Envelope Case
Report (Statewide CASE Team
2020 B)
2. Efficient
Vertical
Fenestration
U-factor = 0.36
SHGC = 0.25
U-factor = 0.34
SHGC = 0.22 ● ● ─ ● ● $1.75/ft2
Final Nonresidential High
Performance Envelope Case
Report (Statewide CASE Team
2020 B)
3. Vertical
Fenestration
as a Function
of Orientation
40% window-to-wall
ratio in each
orientation per Title
24 Table 140.3-B.
Redistribute window
areas by orientation ● ─
─ ─ ─ $0
No additional cost. This
measure is a design
consideration.
HVAC and SHW
4. Water
Efficient
Fixtures in
Kitchen
Kitchen faucet max
flow rate is 1.8 GPM
(Title 20)
Kitchen faucet flow
rate is 1 GPM
─ ─ ● ─ ─
High efficiency,
door-type, high
temperature
dishwasher:
$7,633/unit
Faucet aerator:
$8/unit
Combination of literature
review, online sources such as
Home Depot and
manufacturer websites
5.Ozone
Washing
Machine
Not required Reduced hot water
use ─ ─ ─ ─ ● $25,469/unit
DEER Deemed measure
SWAP005-01 (California
Public Utilites Commission
2022)
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Measure Applicability
• Included in packages with energy efficiency measures
- Not Applicable
Measure
Baseline T24
Requirement Proposed Measure
Med
Office
Med
Retail
Quick-
Service
Restaurant
Small
Hotel:
Guest
Rooms
Small Hotel:
Nonresidential
Incremental
Cost Sources & Notes
6. Efficient Hot
Water
Distribution
Appendix A Pipe
Sizing with standard
pipe insulation
thickness 1.5’’
Appendix M pipe
sizing with 2” pipe
insulation thickness ─ ─ ─ ● ─ $5,819
Multifamily Domestic Hot
Water Final CASE Report
7. DCV &
Transfer Air
DCV required in
kitchen for exhaust
air rate > 5000 cfm
DCV for all exhaust
fans ─ ─ ● ─ ─ $8,500
Mechanical contractor cost
estimate
8. Guest Room
Ventilation,
Temperature
Setback, and
Fan Power
Guest rooms
required to have
occupancy sensing
zone controls, but
no ventilation fan
power requirement.
Updated fan power
and HVAC schedules
─ ─ ─ ● ─ $0
No cost increase, as guest
rooms already have controls.
9. Variable
Speed Fans
Variable speed
required if cooling
capacity is greater
than 65,000 Btu/h
Variable speed
control for smaller
capacity systems ─ ● ● ─ ─ $6,390/unit
Mechanical contractor cost
estimate
Lighting
10. Interior
Lighting
Reduced LPD
Per Area Category
Method, varies by
Primary Function
Area.
Top 20% of market
products ● ● ● ─ ● $0
Industry report on LED pricing
analysis shows that costs are
not correlated with efficacy.
(Navigant Consulting 2018)
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3.2.3 Load Flexibility
The Reach Code Team investigated a range of high-impact demand flexibility strategies potentially applicable to the
four prototypes. The list of strategies is informed by DOE’s Grid -interactive Efficient Buildings efforts and the 2022
Nonresidential Grid Integration CASE report (U.S. Department of Energy 2021, Statewide CASE Team 2020). The
Team selected the three measures based on their load flexibility potential, cost, compliance software modeling
capabilities, savings potential and the ease of project implementation and field verification:
Please note that these measures require a ruleset update and cannot be modeled currently for compliance purposes.
11. Temperature Setback using Smart Thermostat: This measure leverages the existing mandatory
requirement for HVAC zone thermostatic controls to pre-condition spaces prior to, and to shed demand during,
peak period. This measure introduces a setback in temperature setpoint during peak period and incurs no
additional cost because Occupant-Controlled Smart Thermostats (OCSTs) are already required for buildings
similar to the Medium Office prototype.
Modeling: Instead of utilizing the demand responsive features, OCST would be used to change
temperature setpoints and setpoint schedules. These changes were integrated by altering the
setpoint schedules directly in the backend ruleset files of CBECC software.
Specification: In the base case, the Medium Office prototype HVAC equipment schedules dictate "on" hours
(at desired temperature) from 6:00 AM through 12:00 AM on weekdays and 6:00 AM – 7:00
PM on Saturdays. All Sunday hours are "off." Cooling setpoints are 75°F during "on" and 85°F
when "off" hours; heat setpoints are 70°F during "on" and 60°F during "off" hours. The Team
modified this schedule such that the "on" setpoints are stepped back by 2°F from 4:00 PM
through 12:00 AM on weekdays; and from 4:00 PM – 7:00 PM on Saturdays.
12. Demand Response Capable HPWH: The Reach Code Team modeled a measure intended to reduce the
peak demand of the significant hot water loads in the QSR prototype. The measure increases costs due to
adding a 100-gallon storage tank and plumbing hardware. The additional hot water storage enables pre-
heating water ahead of demand by effectively increasing the HPWH’s thermal storage capacity. The extra
plumbing hardware is needed to keep the stored hot water stratified to maintain efficient HPWH operations .
The Team did not directly address the issue of storage tank location but assumed floor plan design would be
able to accommodate it.
Modeling: The measure uses the HPWH and additional storage tank capacity to produce and store hot
water ahead of actual use during evening peak period. QSR hot water baseline schedule
exhibits a low morning load (6:00 AM – 8:00 AM), moderate load near lunch time (11:00 AM),
and a peak evening load (4:00 PM – 11:00 PM). These changes were made by changing the
hot water load fraction in the ruleset.
Specification: Implements an early pre-heat that starts at 12:00 PM and finishes by 7:00 PM, avoiding the
super peak hours of 7:00 PM – 9:00 PM.
13. Demand Response Lighting: This measure extends existing Title 24 mandatory requirements for demand
responsive lighting by shedding demand during peak hours. There are no additional measure costs because
demand responsive control capability is already required for nonresidential buildings with more than 4kW of
total lighting load. This measure does not require additional commissioning.
Modeling: The baseline lighting schedule exhibits a plateau of 0.65 load fraction from 8:00 AM – 8:00 PM
and trails off after 8:00 PM through the end of the day for weekdays. The Team altered the
ruleset to reduce the load fraction during 4:00 PM – 9:00 PM.
Specification: The Team implemented a 10% setback during the 4-9pm peak hours.
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The load flexibility measure applications to each prototype are summarized in Table 14.
Table 14. Load Flexibility Measure Summary
Measure Med
Office
Med
Retail QSR Small Hotel Incremental Cost Other Notes
11. Smart
Thermostat ● - - - $0 Capability already required
12. Demand Control
HPWH - - ● - $5,400
An additional 100-gallon tank,
plumbing hardware, and related
labor hours
13. Demand
Response Lighting ● - - - $0 Capability already required
None of the measures apply to the Medium Retail or Small Hotel prototypes. While the Small Hotel contains some
office space and common areas, the Medium Office load flexibility measures were not applied to the Small Hotel
spaces because of the potential for unpopular impacts, varying occupancy schedules, difficult field maintenance, and
limited energy impacts. Team also explored the impact of load flexibility in all-electric clothes dryer scenario but did not
see enough savings impact, hence the measure was not included in the package.
3.2.4 Additional Solar PV and Battery Storage
The Reach Code Team considered additional solar PV and battery storage measures that exceed the 2022 Title 24
prescriptive requirements to improve the cost-effectiveness of proposed scenarios. For Medium Office and Retail, the
prescriptive solar PV sizes are large enough to occupy the entirety of the available roof space. Additional rooftop solar
PV could not be considered for the two prototypes. For the Quick-Service Restaurant, solar PV is not prescriptively
required since the prototype qualifies for the exception and the Reach Code Team considered adding solar PV to
improve cost-effectiveness. For Small Hotel, the required PV size in the code-compliant models did not occupy the
entire available roof space. Additional PV system capacity was considered as a measure to improve cost-effectiveness.
For the cost-effectiveness analysis, the Team evaluated additional solar PV for all-electric scenarios for the two
building types, Quick Service Restaurant and Small Hotel. The additional PV size is calculated based on available roof
space, assuming the maximum available space is 50% of total roof space and 15 Watt per square foot panel size.
Modeling: Updated PV capacity (kW) input in CBECC software.
Specification: Baseline requirement is 0 kW and 22-32.6 (depending on climate zone) kW for Quick-Service
Restaurant and Small Hotel respectively. Proposed measure specification is 18.8 kW and 79.8
kW for Quick-Service Restaurant and Small Hotel respectively.
The costs for PV include first cost to purchase and install the system, inverter replacement costs, and annual
maintenance costs. A summary of incremental costs and sources is given in Table 15 below.
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Prototypes, Measure Packages, and Costs
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-03-24
Table 15. Additional Solar PV Measure Summary
Measure Med
Office
Med
Retail QSR Small
Hotel Incremental Cost Cost Source
Solar PV - - ● ●
First Cost: $3.20/W
Inverter replacement cost at 10-yr:
$0.15/W
Annual Maintenance Cost: $0.02/W
ITC Federal Incentive: 30%
National Renewable Energy
Laboratory (NREL) Q1 2016
(National Renewable Energy
Laboratory 2016)
E3 Rooftop Solar PV System
Report (Energy and
Environmental Economics,
Inc. 2017)
Upfront solar PV system costs are lowered because of the federal income tax credit (ITC)—approximately 30 percent
based on the passage of Inflation Reduction Act. PV energy output is built into CBECC and is based on NREL’s
PVWatts calculator, which includes long term performance degradation estimates.
A battery storage system is prescriptively required for three prototypes : Medium Office, Medium Retail, and Small
Hotel. The current software, CBECC v1.0, applies the appropriate prescriptive battery size (kWh) and capacity (kW) in
the standard design. However, the control assumed in standard design is “Basic Control”, which does not function for
optimum battery use. The Team did not evaluate additional battery measures because the compliance software does
not apply the “Time of Use” battery control method in standard design, which impacts the incremental energy costs and
TDV benefits.
3.3 Measure Packages
The Reach Code Team compared a baseline Title 24 prescriptive package to mixed-fuel packages and two to four
electrification packages depending on applicability of building type. Note that most QSR all-electric packages exclude
kitchen electrification, while the Small Hotel all-electric package does include electric laundry cost and energy impacts .
▪ Mixed Fuel Code Minimum: Mixed-fuel prescriptive building per 2022 Title 24 requirements.
▪ Mixed Fuel + Efficiency Measures: Mixed-fuel prescriptive building per 2022 Title 24 requirements, including
additional efficiency measures.
▪ All-electric Code Minimum Efficiency: All-electric building to minimum Title 24 prescriptive standards and
federal minimum efficiency standards. This package has the same PV size as mixed-fuel prescriptive baseline.
▪ All-electric Energy Efficiency: All-electric building with added energy efficiency measures related to HVAC,
SHW, lighting or envelope.
▪ All-electric Energy Efficiency + Load Flexibility: All-electric building with added energy efficiency and load
flexibility measures.
▪ All-electric Energy Efficiency + Solar PV: All-electric building with added energy efficiency and additional
Solar PV. The added PV size is larger than prescriptive 2022 Title 24 code requirements and accounts for roof
space availability.
For QSR, the Reach Code Team has analyzed two scenarios for all-electric packages, one with electric cooking and
the one with gas cooking (the latter of which is referred to as the “HS” package to reflect all-electric HVAC and SHW).
The results section includes results for both scenarios since all-electric package with electric cooking appliance can be
cost-effective in POU territories. This study did not evaluate pre-empted package with all-electric HVAC and SHW to
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localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-03-24
have higher efficiency than required by federal regulations, that will potentially enhance cost-effectiveness and/or
compliance margins.
For Small Hotel, the Reach Code Team also analyzed an alternative scenario with PTHP instead of SZHP in all-electric
scenario. It is denoted by the “PTHP” in parenthesis in package name.
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Cost-Effectiveness Results
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-03-24
4 Cost-Effectiveness Results
Cost-effectiveness results are presented in this section and the attached workbook per prototype and measure
packages described in Section 3. The TDV and On-Bill based cost-effectiveness results are presented in terms of B/C
ratio and NPV.
In the following figures, the result Both (shown in green shading) indicates that the result is cost-effective on both On-
Bill and (Total) TDV basis. The result On-Bill or TDV (shown in yellow shading) indicates that the result is either cost-
effective on On-Bill or (Total) TDV basis, respectively. The result “ - “ (results with no shading) indicates that the result
is not cost-effective on either an On-Bill basis or (Total) TDV basis.
Across all prototypes and climate zones, efficiency measures improve cost-effectiveness when added to the mixed-fuel
baseline prototype and all-electric federal code minimum designs.
All-electric cost-effectiveness results by prototype can be summarized as:
Medium Office (Figure 1): All-electric space heating is predominantly achieved through electric resistance
due to modeling limitations, which limits operational benefits. Efficiency measures yield some On-Bill cost-
effective all-electric packages in milder climate zones. Adding load flexibility measures increases the cost-
effectiveness to most climates.
Medium Retail (Figure 2): All-electric packages are cost-effective in all climate zones with added efficiency
measures over all-electric baseline. Proposed mixed-fuel packages are cost-effective too with added
efficiency measures in most climate zones primarily driven by cost-equivalency in the all-electric package
compared to a mixed-fuel package.
Quick-Service Restaurant (Figure 3): All-electric package with and without cooking electrification is cost-
effective in CPAU and SMUD territories only, On-Bill. All-electric HVAC and SHW package with added
efficiency measures is On-Bill cost-effective in CZs 1, 3-5 and 12. Adding efficiency and solar PV is On-Bill
cost-effective in CZs 1-5, 11-13, and 16. While not depicted in Figure 3, the Results Workbook indicates
that all-electric HVAC and SHW plus efficiency packages are nearly cost-effective (greater than
-$350/month) in all climate zones using On-Bill Net Present Values.
Small Hotel (Error! Reference source not found.): The all-electric hotel has tremendous cost savings
compared to a mixed-fuel package, primarily due to the avoidance of gas infrastructure to each guest room.
All-electric packages achieve TDV cost-effectiveness in all CZs except 16. On-Bill cost-effectiveness is
limited to CZs 2-5, 12 and 15 with single zone ducted heat pumps, but nearly all CZs with a packaged
terminal heat pump.
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Cost-Effectiveness Results
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-03-24
4.1 Medium Office
In the all-electric Medium Office building, the upfront cost savings associated with avoiding boiler and gas infrastructure supports cost-effective packages in
several climate zones, particularly with additional efficiency and load flexibility measures .
▪ Adding energy efficiency measures over mixed fuel code minimum is On-Bill cost-effective in all climate zones.
▪ The all-electric code minimum efficiency package is cost-effective for CZs 4 (CPAU), 6-10, 12 (SMUD) and 15.
▪ Adding energy efficiency measures to the all-electric code minimum package extends On-Bill cost-effectiveness to CZ 3 as well.
▪ All-electric energy efficiency along with load flexibility measure package is On-Bill cost-effective in most climate zones except 1, 11 and 16.
Figure 1. Medium Office Cost-Effectiveness Summary
CZ1 CZ2 CZ3 CZ4 CZ5 CZ6 CZ7 CZ8 CZ9 CZ10 CZ11 CZ12 CZ13 CZ14 CZ15 CZ16
Utility
Prototype Package
Both Both Both Both Both
Both Both Both Both Both
On-Bill ─On-Bill ──
On-Bill ─On-Bill On-Bill ─
Both ─Both ──
Both ─Both On-Bill ─
Both Both Both Both On-Bill
Both Both Both Both On-Bill
─
─
Medium Office
(MO)
Mixed Fuel + Efficiency
Measures Both Both Both
All Electric Code
Minimum Efficiency
──Both
Both
Both
Both
Both
Both
─
Climate Zone
PG&E PG&E PG&E
PG&E
CPAU
PG&E
─
SDG&E
SCE
SCE
PG&E
SMUD
PG&E
Both
PG&E
PG&E
SCG
SCE SDG&E PG&E SCE
SDG&E
SCE
Both
Both On-Bill
Both
Both
Both Both Both
──
All-Electric Energy
Efficiency + Load
Flexibility
─Both Both On-Bill Both Both
All Electric Energy
Efficiency
──Both ──
Both
On-Bill Both
Both Both
Both Both
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Cost-Effectiveness Results
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4.2 Medium Retail
2022 Title 24 code prescriptively requires heat pumps in most scenarios already. This report evaluates added energy efficiency measures over the baseline all-
electric scenario and proposed mixed-fuel packages.
▪ The mixed-fuel code minimum is not cost-effective by itself in most climate zones.
▪ Adding energy efficiency measures to the mixed-fuel code minimum package is On-Bill and/or TDV cost-effective in most climate zones.
▪ Adding energy efficiency measures over prescriptive all-electric package is also cost-effective in most climate zones except CZ16 using TDV.
Figure 2. Medium Retail Cost-effectiveness Summary
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4.3 Quick-Service Restaurant (QSR)
High incremental cost for HVAC and SHW electrification (“HS” package) makes restaurant electrification challenging. Because cooking electrification packages
are very expensive – both upfront and operationally in IOU territories – the Team evaluated HS packages that do not consider cooking equipment electrification.
This affects cost-effectiveness as gas infrastructure cost savings do not materialize.
▪ Adding energy efficiency measures over mixed fuel code minimum is On-Bill cost-effective in all climate zones.
▪ All-electric HVAC and SHW “HS” package is On-Bill cost-effective in CZ4 (CPAU) and CZ12 (SMUD) territory only.
▪ Adding energy efficiency and load flexibility measures extends On-Bill cost-effectiveness to CZs 1, 3 and 5.
▪ All-electric HVAC and SHW “HS” package with energy efficiency and solar PV measure is On-Bill cost-effective in climate zones 1-5, 11-13 and 16.
▪ All-electric package including cooking electrification is On-Bill cost-effective in CZ 4 (CPAU) territory only.
▪ The Results Workbook indicates that all-electric HVAC and SHW plus efficiency packages are nearly cost-effective (greater than -$350/month) in all
climate zones using On-Bill Net Present Values.
Figure 3. QSR Cost-effectiveness Summary
CZ1 CZ2 CZ3 CZ4 CZ5 CZ6 CZ7 CZ8 CZ9 CZ10 CZ11 CZ12 CZ13 CZ14 CZ15 CZ16
Utility
Prototype Package
Both Both Both Both Both
Both Both Both Both Both
─────
On-Bill ──On-Bill ─
─On-Bill ───
On-Bill ──On-Bill ─
─────
On-Bill ──On-Bill ─
On-Bill On-Bill ─On-Bill ─
On-Bill On-Bill ─On-Bill ─
─────
On-Bill ────
─────
On-Bill ────
────
Quick-Service
Restaurant (QSR)
All Electric Energy
Efficiency
───────
On-Bill
On-Bill ─
─
──
─
─
───
PG&E
SMUD
PG&E
SDG&E
SCE
SCE PG&E
──────
PG&ESCE
SDG&E
SCE
Both
─
Both
───
Both Both Both Both
Climate Zone
PG&E PG&E PG&E
PG&E
CPAU
PG&E
SCG
SCE SDG&E PG&E
Both
All Electric HS Energy
Efficiency + Solar PV
All Electric Code
Minimum Efficiency
On-Bill
─
On-Bill On-Bill
Both
─
─
─
Mixed Fuel + Efficiency
Measures Both Both
All Electric HS Code
Minimum Efficiency
All-Electric HS Energy
Efficiency + Load
Flexibility
On-Bill ─
All Electric HS Energy
Efficiency
On-Bill ─
─
Both
─
──
On-Bill ─On-Bill
──────────
────On-Bill
─
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Cost-Effectiveness Results
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-03-24
4.4 Small Hotel
The all-electric hotel has cost savings compared to a mixed-fuel package, primarily due to the avoidance of boilers and gas infrastructure to each guest room. The
analysis assumes single zone ducted heat pump for all all-electric scenarios; however, the Team analyzed a Packaged Terminal Heat Pump (PTHP) scenario as
well. PTHP shows higher incremental cost savings as compared to a baseline of mixed fuel single zone packaged system and hence are cost-effective in many
climate zones.
▪ Adding energy efficiency measures over mixed fuel code minimum is On-Bill cost-effective in all climate zones.
▪ All-electric code minimum packages with or without energy efficiency measure packages are TDV cost-effective in all climate zones except 16, and On-
Bill cost-effective in CZ4 (CPAU) and CZ12 (SMUD) due to relatively lower electricity costs.
▪ Additional solar PV over all-electric energy efficiency package extends On-Bill cost-effectiveness to CZs 2, 3, 4 (PG&E), 5 and 15.
▪ The alternative all-electric scenario with PTHP is cost-effective in all climates, On-Bill in most CZs except 7,10 and 14 SDG&E territories.
Figure 4. Small Hotel Cost-effectiveness Summary
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Energy Code Compliance Results and Reach Code Considerations
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5 Energy Code Compliance Results and Reach Code Considerations
This section combines the cost-effectiveness and 2022 Title 24 energy code compliance metric results — efficiency
TDV, total TDV, and source energy, described in Section 2.3 — to highlight the viable reach code options for local
jurisdictions. The Reach Code Team calculated metrics using both:
1. Software outputs using the ACM standard design and
2. Manually by subtraction against the baseline model because of software limitations that are beyond the Reach
Code Team’s control.6
All Efficiency TDV margins presented in this section are the lower of the two approaches, Software output and Manual,
to be conservative and inform the minimum compliance margins that can be met by a typical modeler. Full details of
compliance margins and cost-effectiveness results are presented in the Final Results Workbook for reference.
Importantly, the workbook shows that for all prototypes, all-electric packages are capable of achieving greater
greenhouse savings as compared to mixed-fuel buildings. Below is a summary of how compliance results as well as
cost-effectiveness for each prototype and package could influence reach code options. The Reach Code Team outlines
recommendations using the following framework, based on reach codes that were adopted across California under the
2019 building code cycle:
▪ Mixed fuel buildings are allowed, with efficiency. Local amendments governing efficiency and conservation
must be performed in the Title 24 Part 6 Building Energy Efficiency Standards and be approved by the Energy
Commission.
• Energy Efficiency — Require energy efficiency for buildings regardless of fuel type. A jurisdiction can
require different compliance thresholds for all-electric and/or mixed-fuel. The thresholds should be set
considering how they may affect mixed-fuel or all-electric buildings.
• Electric-Preferred — Allow mixed-fuel appliances but require a higher building performance via
efficiency, total, or source compliance metric (for example, (Milpitas 2019), section 140.1).7 Applies
only to mixed-fuel buildings.
▪ Mixed fuel buildings are not allowed. Local amendments governing green building requirements may be
performed in the Title 24 Part 11 Green Building Standards Code and must be filed with the Building Standards
Commission. Alternatively, the local amendment may be performed in a municipal code chapter of their
respective jurisdictions.
• All-Electric — Require certain all-electric only appliances, with exceptions (for example (Menlo Park
2019). Does not involve efficiency or conservation measures, and cost-effectiveness is a not a legal
requirement.8 Local amendments may be performed through other building code sections, such as
Part 11. See discussion on Exceptions below.
• All-Electric + Efficiency — Require certain all-electric appliances, but with a higher building
performance via efficiency, total, or source compliance metric. Also requires amendment to Title 24
Part 6 and approval by the Energy Commission.
6 The difference between the two methods of calculating TDV margins occurs due to various software limitations. The Team had
challenges modeling a baseline showing zero-percent (exactly compliant) compliance margin, and differing interpretations of 2022
Title 24 code regarding fan power, exhaust fan, heat recovery, battery control, and other aspects. Most scenarios show similar
trends between software calculated compliance margin and the Team’s manual subtraction against baseline model, with a
difference in magnitude. For example, if the Total TDV Compliance margin as shown by software directly is negative, it is typically
negative per manual calculation as well. Nonetheless, modeling limitations introduce error into the calculations, which may affect
results. Many scenarios have very low negative compliance margin and are very close to being zero. While this uncertainty in error
may lead to imprecision in results, relative performance across packages can yield information helpful for decision-making.
7 Note Milpitas has since adopted an All-electric with Exceptions code for the 2022 code cycle.
8 See letter from CEC to South San Francisco for reference.
Formatted: Left: 0.59", Bottom: 0.47", Width: 8.5",
Height: 11"
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Energy Code Compliance Results and Reach Code Considerations
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Exceptions enable reach codes to broadly require electrification except for specific building systems. These
systems may have uncertainty on energy code compliance, building industry electrification approaches, or other
related impacts on economic development. During the 2019 code cycle, cities developed exemptions based on
discussions with local stakeholders, resulting in a wide array of exemption types.9 For the four prototypes in this
study, the Team has determined two exemptions that may be necessary for cities passing All-Electric reach codes.
▪ Building systems without a prescriptive compliance pathway in the energy code. This exemption
considers that all-electric central space heating does not have a prescriptive pathway in Title 24, and central
heat pump boilers cannot be currently modeled, which has impacted compliance results for the Medium Office
and Small Hotel. This exemption has broad precedence and can apply to other large nonresidential buildings
(e.g., (Berkeley 2019), section 12.80.040.A Exception 1). These exemptions typically state that the building is
also not able to comply via the performance approach using commercially available technology.
▪ Commercial cooking. Cooking electrification does not considerably impact code compliance but is not nearly
cost-effective against a mixed-fuel baseline. To account for this challenge, cities may wish to adopt reach
codes that exempt commercial kitchen cooking appliances (e.g., (Menlo Park 2019) 100.0(e)2.A Exception 4).
9 See list of exemptions on Bay Area Reach Codes.
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Energy Code Compliance Results and Reach Code Considerations
localenergycodes.com California Energy Codes & Standards | A statewide utility program 2023-03-24
Table 16. Reach Code Pathway Considerations
Prototype Compliance and Cost-Effectiveness Results Summary Energy Efficiency Electric-
Preferred All-Electric All-Electric +
Efficiency
Medium
Office
The Team could not identify any all-electric package that complies
with all three compliance metrics, with the Efficiency TDV
Compliance margin being the most challenging.
Future iterations of this study will re-evaluate the Medium Office with
a central heat pump boiler, an anticipated compliance software
capability in early 2023, instead of electric resistance VAVs.
To Be Determined.
Modeling constraints
impacted achievable
compliance margins
for all-electric
packages.
All CZs. Exempt building
systems without a
prescriptive
pathway in the
energy code.
To Be Determined.
Modeling constraints
impacted achievable
compliance margins
for all-electric
packages
Medium
Retail
The Team identified cost-effective and code compliant packages of
all-electric + energy efficiency measures across most CZs.
Mixed-fuel + efficiency was cost-effective but not code compliant in
most CZs.
CZs 7 and 9. CZs 7 and 9. CZs 2-15. 2022
T24 prescriptive
baseline
CZs 1-10, 12-14.
Quick-
Service
Restaurant
The Mixed-fuel + efficiency package is cost-effective and compliant
in many climate zones. Code compliance and cost-effectiveness
results support reach code adoption for all-electric space
conditioning and service water heating when adding efficiency and
solar PV for CZs 1 and 3-5, many others are likely to be compliant
with future modeling input updates. Cost-effectiveness is achieved
or nearly achieved (Net Present Value is greater than -$350/month)
On-Bill in all CZs.
Cooking electrification does not impact code compliance but is not
cost-effective against a mixed-fuel baseline except for CPAU
territory.
CZs 1, 3-7. CZs 1-7, 13. CZs 1, 3-7. Exempt
commercial kitchen
appliances, except
CZ4 (CPAU).
Nearly all remaining
CZs have a nearly
cost-effective
and/or nearly
compliant pathway
for HVAC and SHW
only.
CZs 1, 3-5.
Small Hotel
Results support Electric-Preferred reach code for all CZs. The all-
electric packages are near compliant and TDV cost-effective for
most CZs when including energy efficiency measures and additional
solar PV. They are likely to be compliant with future modeling
iterations.
Future iterations of this study will re-evaluate the nonresidential
areas of the hotel with a central heat pump boiler, as mentioned for
the Medium Office, which can potentially improve code compliance.
To Be Determined.
Modeling constraints
impacted achievable
compliance margins
for all-electric
packages.
All CZs. Exempt building
systems without a
prescriptive
pathway in the
energy code.
To Be Determined.
Modeling constraints
impacted achievable
compliance margins
for all-electric
packages.
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Energy Code Compliance Results and Reach Code Considerations
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The combined result of cost-effectiveness and code compliance across all climate zones and packages are detailed in
Section 0 through 5.4 below. The tables are formatted to show:
▪ Cost-effectiveness results with color highlight:
• Green highlight — for scenarios that are cost-effective on both On-Bill and TDV metrics, may or may
not be compliant.
• Yellow highlight — for scenarios that are cost-effective on either one of the On-Bill/TDV metrics, may
or may not be compliant.
• Gray highlight — for scenarios that are not cost-effective on either metric, either compliant currently or
likely to be compliant in future.
• White highlight — for scenarios that are not cost-effective on either metric and are not compliant.
▪ Compliance results with cell values:
• “EffTDV Margin” percentages — for scenarios that are compliant, across both Manual and CBECC
software output, the reported value is the minimum of the two.
• “-” for scenarios that do not comply across any one code compliance metric.
“TBD” – for scenarios that are likely to be compliant with modeling updates or software versions in future, maybe
compliant across either one of the Manual or CBECC software output approach or has a system type modeling
limitation such as central heat pump boiler for Medium Office and Small Hotel. The package names in table results
columns are as follows, as defined in Section 3.3:
▪ Mixed fuel — Code Min: Mixed Fuel Code Minimum Efficiency
▪ Mixed fuel — EE: Mixed Fuel + Efficiency Measures
▪ All-electric — Code Min: All-electric Code Minimum Efficiency
▪ All-electric — EE: All-electric Energy Efficiency
▪ All-electric — EE + LF: All-electric Energy Efficiency and Load Flexibility
▪ All-electric — EE + PV: All-electric Energy Efficiency and Solar PV
The QSR has two electrification scenarios, with and without cooking appliance electrification, which is denoted by “HS”
prefix.
The Small Hotel has an extra package that evaluates a different HVAC type in the all-electric Code Minimum Efficiency
package, a Packaged Terminal Heat Pump (PTHP) instead of a Single Zone Heat Pump.
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5.1 Medium Office
For Medium Office, the Reach Code Team analyzed EE measures over mixed fuel baseline model and three
electrification packages: 1) Code Min, 2) EE and 3) EE + LF packages, results shown in Table 17.
The most likely all-electric replacement for a central gas boiler serving a VAV reheat system would be a central heat
pump boiler; however, this system cannot be modeled in CBECC at the time of the writing of this report. As such, the
Reach Code Team is treating this analysis as temporary until a compliance pathway is established for a central heat
pump boiler in the Energy Code and results can be updated accordingly. This modeling capability is anticipated in early
2023 according to discussions with the CBECC software development team, and the cost -effectiveness analysis
should become available in the first half of 2023. Heat pump systems are multiple times more efficient, but may also be
multiple times more costly, than the electric resistance reheat systems currently analyzed.
▪ Results support reach code adoption for energy efficiency measures over mixed fuel baseline, also known as
the “Electric-Preferred”. A compliance margin of 4–5% is achievable depending on the climate zone.
▪ No all-electric package complies with all three-compliance metrics, with the efficiency compliance TDV margin
being the most challenging. The Reach Code Team explored other efficiency measures that reduce the
efficiency compliance TDV margin, but not enough to make the TDV margin positive. The compliance values
are labeled as “TBD” for all-electric packages, as they are likely to be compliant with future modeling and/or
software updates. Some climate zones are compliant currently on either one of the Software output or Manual
compliance approaches.
Table 17. Cost-effectiveness and Compliance Summary – Medium Office
CZ Utility
Mixed
Fuel All-electric
EE Code Min EE EE + LF
cz01 PG&E 4% TBD TBD TBD
cz02 PG&E 5% TBD TBD TBD
cz03 PG&E 5% TBD TBD TBD
cz04 PG&E 4% TBD TBD TBD
cz04-2 CPAU 4% TBD TBD TBD
cz05 PG&E 5% TBD TBD TBD
cz05-2 SCG 5% TBD TBD TBD
cz06 SCE 6% TBD TBD TBD
cz07 SDG&E 7% TBD TBD TBD
cz08 SCE 6% TBD TBD TBD
cz09 SCE 4% TBD TBD TBD
cz10 SDG&E 4% TBD TBD TBD
cz10-2 SCE 4% TBD TBD TBD
cz11 PG&E 3% TBD TBD TBD
cz12 PG&E 4% TBD TBD TBD
cz12-2 SMUD 4% TBD TBD TBD
cz13 PG&E 4% TBD TBD TBD
cz14 SDG&E 4% TBD TBD TBD
cz14-2 SCE 4% TBD TBD TBD
cz15 SCE 3% TBD TBD TBD
cz16 PG&E 4% TBD TBD TBD
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* These results will be re-evaluated with central heat pump boiler system instead of electric resistance VAV systems,
which largely are unable to achieve energy code compliance.
5.2 Medium Retail
For Medium Retail, the Team analyzed EE measure package over an all-electric baseline model and two mixed
fuel packages — Code Min and EE, with results in Table 18.
▪ Results support reach code adoption for energy efficiency measures over mixed fuel code minimum package,
also known as “Electric-Preferred” or “Energy Efficiency” reach code pathways in climate zones 7 and 9.
▪ Results also support “All-Electric + Efficiency” reach code option, with compliance margins of 4-14% above the
all-electric code minimum baseline in climate zones 1-10 and 12-14.
▪ For some scenarios in climate zone 6, 8, 11, 15 and 16, labeled as “TBD”, the package is cost-effective and
likely to be compliant in future with modeling input and/or software version updates.
Table 18. Cost-effectiveness and Compliance Summary – Medium Retail
CZ Utility Mixed Fuel All-
electric
Code Min EE EE
cz01 PG&E - - 6%
cz02 PG&E - - 4%
cz03 PG&E - - 12%
cz04 PG&E - - 11%
cz04-2 CPAU - - 11%
cz05 PG&E - - 12%
cz05-2 SCG - - 12%
cz06 SCE - TBD 9%
cz07 SDG&E - 12% 14%
cz08 SCE - TBD 8%
cz09 SCE - 11% 12%
cz10 SDG&E - - 3%
cz10-2 SCE - - 3%
cz11 PG&E - - TBD
cz12 PG&E - - 10%
cz12-2 SMUD - - 10%
cz13 PG&E - - 4%
cz14 SDG&E - - 7%
cz14-2 SCE - - 7%
cz15 SCE - - TBD
cz16 PG&E - - TBD
Cell Color
Cost effective on both TDV/On-Bill metrics
Cost effective on either TDV/On-Bill metrics
Compliant, not cost effective
Not compliant nor cost effective
Cell Value
X%EffTDV Compliance Margin percentages (Lowest common)
Compliant on both Manual and Software output approaches
TBD Likely to comply with future modeling updates or software versions,
maybe compliant on either Manual or Software output approach
-Not compliant on either approach
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Cell Color
Cost effective on both TDV/On-Bill metrics
Cost effective on either TDV/On-Bill metrics
Compliant, not cost effective
Not compliant nor cost effective
Cell Value
X%EffTDV Compliance Margin percentages (Lowest common)
Compliant on both Manual and Software output approaches
TBD Likely to comply with future modeling updates or software versions,
maybe compliant on either Manual or Software output approach
-Not compliant on either approach
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5.3 Quick-Service Restaurant (QSR)
The Team analyzed efficiency measures over a mixed fuel baseline and electrification packages, with and without
cooking appliance electrification. For the “HS” scenario including HVAC and SHW electrification only, packages
with EE, EE + LF and EE + PV were analyzed, with results in Table 19.
▪ Results support reach code adoption for energy efficiency measures over a mixed fuel baseline, also known as
“Electric-Preferred” in climate zones 1 to 7 and 13, or “Energy Efficiency” in CZs 1 and 3 to 7.
▪ All-electric “HS” HVAC and SHW electrification can be adopted in CZs 1 and 3-7 since it is code compliant and
nearly cost effective on at least one metric when energy efficiency measures and/or load flexibility or solar PV
measure is added, demonstrated by yellow or gray cells.
▪ All-electric “HS” HVAC and SHW option with additional efficiency measures can be adopted in CZs 1 and 3-5.
Adding solar PV makes the package on-bill cost-effective on at least one metric marked as yellow cells..
▪ Packages labeled as “TBD” may or may not be cost-effective but are likely to be compliant in the future with
modeling input and/or software updates.
Table 19. Cost-effectiveness and Compliance Summary – Quick-Service Restaurant (without
cooking electrification)
CZ Utility Mixed Fuel All-electric "HS" (HVAC+SHW)
EE Code Min EE EE + LF EE + PV
cz01 PG&E 16% - 6% 16% 6%
cz02 PG&E 6% - TBD TBD TBD
cz03 PG&E 18% - 8% 13% 8%
cz04 PG&E 16% - 5% 8% 5%
cz04-2 CPAU 16% - 5% 8% 5%
cz05 PG&E 18% - 8% 15% 8%
cz05-2 SCG 18% - 8% 15% 8%
cz06 SCE 16% - 3% 6% 3%
cz07 SDG&E 21% - 9% 13% 9%
cz08 SCE TBD - - - -
cz09 SCE TBD - TBD TBD TBD
cz10 SDG&E TBD - - - -
cz10-2 SCE TBD - - - -
cz11 PG&E TBD - TBD TBD TBD
cz12 PG&E TBD - TBD TBD TBD
cz12-2 SMUD TBD - TBD TBD TBD
cz13 PG&E 7% - TBD TBD TBD
cz14 SDG&E TBD - TBD TBD TBD
cz14-2 SCE TBD - TBD TBD TBD
cz15 SCE TBD - TBD TBD TBD
cz16 PG&E TBD - - TBD -
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The Reach Code Team analyzed a completely all-electric package including cooking appliances, results shown in
Table 20, which show compliance in many climate zones with added efficiency and load flexibility. Remaining CZs
are “TBD”, except climate zone 16, which comply on either one of the Manual or Software output approaches
currently and are likely to show compliance with future modeling updates. However, the all-electric package is cost-
effective in CZ4 CPAU territory only and very close to being cost-effective in SMUD territory. Cooking electrification
is expensive and challenging to show cost-effective.
Table 20. Cost-effectiveness and Compliance Summary – Quick-Service Restaurant (with
cooking electrification)
CZ Utility All-electric
Code Min EE EE + LF
cz01 PG&E - 6% 15%
cz02 PG&E - TBD 2%
cz03 PG&E - 10% 14%
cz04 PG&E - 8% 10%
cz04-2 CPAU - 8% 10%
cz05 PG&E - 10% 17%
cz05-2 SCG - 10% 17%
cz06 SCE - 6% 10%
cz07 SDG&E - 11% 14%
cz08 SCE - TBD TBD
cz09 SCE - TBD TBD
cz10 SDG&E - TBD TBD
cz10-2 SCE - TBD TBD
cz11 PG&E - TBD 0%
cz12 PG&E - TBD TBD
cz12-2 SMUD - TBD TBD
cz13 PG&E - TBD TBD
cz14 SDG&E - TBD TBD
cz14-2 SCE - TBD TBD
cz15 SCE - TBD 2%
cz16 PG&E - - -
Cell Color
Cost effective on both TDV/On-Bill metrics
Cost effective on either TDV/On-Bill metrics
Compliant, not cost effective
Not compliant nor cost effective
Cell Value
X%EffTDV Compliance Margin percentages (Lowest common)
Compliant on both Manual and Software output approaches
TBD Likely to comply with future modeling updates or software versions,
maybe compliant on either Manual or Software output approach
-Not compliant on either approach
Cell Color
Cost effective on both TDV/On-Bill metrics
Cost effective on either TDV/On-Bill metrics
Compliant, not cost effective
Not compliant nor cost effective
Cell Value
X%EffTDV Compliance Margin percentages (Lowest common)
Compliant on both Manual and Software output approaches
TBD Likely to comply with future modeling updates or software versions,
maybe compliant on either Manual or Software output approach
-Not compliant on either approach
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5.4 Small Hotel
The Team analyzed EE package over mixed fuel baseline and three electrification packages - Code Min, EE,
EE+PV, with results in Table 21.
▪ Results support reach code adoption for energy efficiency measures over mixed fuel baseline, also known as
“Electric-Preferred” reach code pathway with 2-5% compliance margin.
▪ All-electric packages with efficiency measures and/or solar PV in most CZs are cost-effective and likely to be
compliant in future with modeling and/or software version updates. Some climate zones are compliant currently
across either one of the Manual or Software output approaches.
▪ All all-electric scenarios are labeled as “TBD” because 36% of conditioned floor area is nonresidential space
and has the same system type limitation as Medium Office (see Section 5.1). Hence, the Small Hotel will be re-
evaluated as well with a central heat pump boiler system instead of electric resistance VAV system in early
2023. The current results show compliance on either one of the Manual or Software output approaches in
some climate zones with efficiency measures and solar PV, still labeled as “TBD” until the software
inconsistencies are resolved.
Table 21. Cost-effectiveness and Compliance Summary – Small Hotel.
Mixed Fuel
EE Code Min EE EE + PV
cz01 PG&E 5%TBD TBD TBD
cz02 PG&E 4%TBD TBD TBD
cz03 PG&E 5%TBD TBD TBD
cz04 PG&E 5%TBD TBD TBD
cz04-2 CPAU 5%TBD TBD TBD
cz05 PG&E 5%TBD TBD TBD
cz05-2 SCG 5%TBD TBD TBD
cz06 SCE 5%TBD TBD TBD
cz07 SDG&E 4%TBD TBD TBD
cz08 SCE 5%TBD TBD TBD
cz09 SCE 5%TBD TBD TBD
cz10 SDG&E 5%TBD TBD TBD
cz10-2 SCE 5%TBD TBD TBD
cz11 PG&E 3%TBD TBD TBD
cz12 PG&E 4%TBD TBD TBD
cz12-2 SMUD 4%TBD TBD TBD
cz13 PG&E 3%TBD TBD TBD
cz14 SDG&E 4%TBD TBD TBD
cz14-2 SCE 4%TBD TBD TBD
cz15 SCE 5%TBD TBD TBD
cz16 PG&E 2%TBD TBD TBD
CZ Utility All-electric
Cell Color
Cost effective on both TDV/On-Bill metrics
Cost effective on either TDV/On-Bill metrics
Compliant, not cost effective
Not compliant nor cost effective
Cell Value
X%EffTDV Compliance Margin percentages (Lowest common)
Compliant on both Manual and Software output approaches
TBD Likely to comply with future modeling updates or software versions,
maybe compliant on either Manual or Software output approach
-Not compliant on either approach
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The Team analyzed an additional scenario that proposes PTHP compared to the same SZAC mixed fuel baseline
model, results shown in Table 22. Though PTHP is a much cheaper alternative than SZHP, it is not compliant by
itself.
Table 22. Cost-effectiveness and Compliance Summary – Small Hotel (PTHP)
CZ Utility
All-electric
Code Min
(PTHP)
cz01 PG&E -
cz02 PG&E -
cz03 PG&E -
cz04 PG&E -
cz04-2 CPAU -
cz05 PG&E -
cz05-2 SCG -
cz06 SCE -
cz07 SDG&E TBD
cz08 SCE TBD
cz09 SCE TBD
cz10 SDG&E -
cz10-2 SCE -
cz11 PG&E -
cz12 PG&E -
cz12-2 SMUD -
cz13 PG&E -
cz14 SDG&E -
cz14-2 SCE -
cz15 SCE -
cz16 PG&E -
Cell Color
Cost effective on both TDV/On-Bill metrics
Cost effective on either TDV/On-Bill metrics
Compliant, not cost effective
Not compliant nor cost effective
Cell Value
X%EffTDV Compliance Margin percentages (Lowest common)
Compliant on both Manual and Software output approaches
TBD Likely to comply with future modeling updates or software versions,
maybe compliant on either Manual or Software output approach
-Not compliant on either approach
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6 Conclusions
The Reach Code Team developed a variety of packages involving fuel substitution, energy efficiency, load flexibility,
and solar PV, simulated them in building modeling software, and gathered costs to determine the cost-effectiveness of
multiple scenarios. The Team coordinated with multiple utilities, cities, and building community experts to develop a set
of assumptions considered reasonable in the current market. Changing assumptions, such as the period of analysis,
measure selection, fuel costs, other costs, energy escalation rates, software or utility tariffs may change the results.
These results, including the attached Reach Code Results Workbook, indicate all-electric packages are capable of
achieving the greatest GHG savings as compared to mixed-fuel buildings, see Appendix 8.5. Jurisdictions may adopt a
variety of reach codes such as “Energy Efficiency”, “Electric-Preferred”, “All-Electric” or “All-Electric + Efficiency.” In
summary:
▪ The Reach Code Team has identified a cost-effective and code compliant energy efficiency measure package
for most prototypes and climate zones analyzed, which supports an “Electric -Preferred” and/or “Energy
Efficiency” reach code pathways for jurisdictions.
▪ “All-Electric” reach codes are feasible for all building types and climate zones when Part 11 is modified ,
including some exceptions.
• All-electric HVAC consisting of packaged single zone systems, including rooftop units in the Medium
Retail and Quick-Service Restaurant, and single zone heat pumps in the Small Hotel guest rooms, are
widely shown to be cost-effective and energy code compliant, with exceptions in CZs 1 and 16.
• All-electric SHW systems have a prescriptive pathway for all building types and h ave not been shown
to be an impediment to cost-effectiveness or energy code compliance of all-electric packages in this
study.
• All-electric laundry in the Small Hotel can be cost-effective with added energy efficiency and additional
solar PV than required prescriptively by 2022 Title 24 code.
• Medium Office all-electric packages are cost-effective with energy efficiency and load flexibility
measures, but not code compliant due to the use of electric resistance VAV reheat systems. The Small
Hotel faces a similar issue for its smaller nonresidential area HVAC systems in some climate zones.
This indicates that further efficiency measures would need to be added to achieve energy code
compliance which may not be cost-effective. As described in Sections 5.1 and 5.4, modeling limitations
impacted the code compliance results for the medium office and nonresidential portion of the small
hotel. These prototypes will be re-evaluated using a more appropriate central heat pump boiler HVAC
system, likely available in compliance software in early 2023. In the meantime, jurisdictions can
choose to exempt building systems that do not have a prescriptive compliance pathway in the energy
code. See Berkeley’s all-electric ordinance (Berkeley 2019) section 12.80.040.A Exception 1 for an
example.
▪ Commercial kitchen electrification is challenging to design cost -effectively currently. These results align with a
previous study focusing on restaurants (Statewide IOU Team 2022). Jurisdictions may choose to exempt
cooking appliances until cost-effectiveness factors improve. See Menlo Park's ordinance (Menlo Park 2019)
100.0(e)2.A Exception 4 for an example.
▪ For the Medium Retail prototype in CZs 2 to 15, there is already a prescriptive pathway to co mply with
packaged single zone heat pumps in smaller (<240 kBtuh) thermal zones. This study supports an “All-Electric
+ Efficiency” reach code pathway for many climates. However, mixed-fuel scenarios with SZAC and gas
furnaces for larger (>240 kBtuh) thermal zones are challenging to show cost-effectiveness and/or code
compliance, except for climate zones 7 and 9, when including efficiency measures.
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Further discussion is required at the jurisdiction and community members to review results and determine appropriate
reach code pathways. Please refer to the limitations of this study, described in Section 2.5, while using them to inform
reach code policies. Of note:
▪ The Team employed several CBECC ruleset modifications to support achieving cost-effective packages,
especially load flexibility measures. Ruleset modifications cannot be used by the building industry for code
compliance without supporting justification or alternate methods. Where jurisdictions want to encourage the
adoption of Load Flexibility measures through modeling estimates, the Reach Code Team can support cities
and building applicants by providing modeling approximations that may achieve similar energy and compliance
total impacts, in coordination with the Energy Commission. For example, for the Demand Response Lighting
measure, the Team may be able to share a TDV/ft2 impact of the measure in that climate zone or provide
guidance to the building applicant’s energy consultant on appropriate modeling and documentation.
▪ Results are predominantly based on the code compliance metrics that are manually calculated based on the
mixed fuel baseline model and not the standard design model assumed by the current software version. The
Team also provided software reported compliance metrics in the workbook for reference. The Team is in
communication with software development team to resolve differences in future iterations of this study and the
software and improve code compliance reporting.
Even considering the limitations, this study has identified a set of reach code pathways for all climate zones, and
jurisdictions have broad discretion on how to interpret the study’s findings. Jurisdictions can adopt reach codes
requiring energy efficiency via a Title 24 Part 6 local amendment, or electrification via a Title 24 Part 11 (or municipal
code) amendment, or both. Jurisdictions may choose to except particular building systems from certain reach codes
pathways.
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7 References
Berkeley. 2019. Local Energy Codes.
https://localenergycodes.com/download/398/local_government_adoption_ordinance/fieldList/Berkeley%20
2019%20All-Electric%20-%20Ordinance%207672.pdf.
California Building Energy Code Compliance. 2022. CBECC Title-24 Compliance Software. August 2.
https://bees.noresco.com/software2022.html.
California Public Utilites Commission. 2022. "Workpaper and Disposition Archive." SWAP005. June 9.
http://deeresources.net/workpapers.
California Technical Forum. 2022. THE CA ELECTRONIC TECHNICAL REFERENCE MANUAL (ETRM). June 9.
http://www.caltf.org/etrm-overview.
E3. 2021. https://efiling.energy.ca.gov/GetDocument.aspx?tn=233260&DocumentContentId=65748 .
E-CFR. 2020. https://www.ecfr.gov/cgi-
bin/retrieveECFR?gp=&SID=8de751f141aaa1c1c9833b36156faf67&mc=true&n=pt10.3.431&r=PART&ty=HTM
L#se10.3.431_197. https://www.ecfr.gov/cgi-
bin/retrieveECFR?gp=&SID=8de751f141aaa1c1c9833b36156faf67&mc=true&n=pt10.3.431&r=PART&ty=HTM
L#se10.3.431_197.
Energy + Environmental Economics. 2019a. "Residential Building Electrification in California." April. Accessed 8 2,
2022. https://www.ethree.com/wp-
content/uploads/2019/04/E3_Residential_Building_Electrification_in_California_April_2019.pdf.
Energy and Environmental Economics, Inc. 2017. "2019 Update to the Title 24 Part 6 Building Energy Efficienc y
Standards: Rooftop Solar PV System." September. Accessed 8 2, 2022.
file:///C:/Users/mflores/Downloads/TN221366_20171002T104342_Rooftop_Solar_PV_Stystem_Report%20(
1).pdf.
Lawrence Berkeley National Lab. 2020. Proving the Business Case for Building Analytics. October. http://smart-
energy-analytics.org/assets/EMIS%20Report.pdf.
Menlo Park. 2019. Local Energy Codes.
https://localenergycodes.com/download/353/local_government_adoption_ordinance/fieldList/Menlo%20Pa
rk%202019%20-%20Ordinance%201057.pdf.
Milpitas. 2019. Local Energy Codes.
https://localenergycodes.com/download/356/local_government_adoption_ordinance/fieldList/Milpitas%20L
ocal%20Ordinance%20NO%2065%20148.pdf.
National Renewable Energy Laboratory. 2016. "U.S. Solar Photovoltaic System Cost Benchmark: Q1 2016." NREL.gov.
September. Accessed 8 2, 2022. https://www.nrel.gov/docs/fy16osti/66532.pdf.
Navigant Consulting. 2018. "California LED Pricing Analysis." January.
https://www.calmac.org/publications/LED_Pricing_Analysis_Report_-_Revised_1.19.2018_Final.pdf.
NORESCO. 2020. "Time Dependent Valuation of Energy for Developing Building Efficiency Standards."
https://efiling.energy.ca.gov/GetDocument.aspx?tn=233257&DocumentContentId=65743 .
San Diego Gas and Electric Company. 2012. "Commercial Kitchen Demand Ventilation Controls-Electric." June 15.
https://view.officeapps.live.com/op/view.aspx?src=https%3A%2F%2Fwww.sdge.com%2Fsites%2Fdefault%2F
files%2FWPSDGENRCC0019%252520Rev%2525200%252520Demand%252520Ventilation%252520Controls_0.
doc&wdOrigin=BROWSELINK.
Statewide CASE Team. 2020. August. https://title24stakeholders.com/wp-content/uploads/2020/08/NR-Grid-
Integration_Final-CASE-Report_Statewide-CASE-Team.pdf.
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—. 2011 C. "Fan Control and Integrated Economizers." September. https://title24stakeholders.com/wp-
content/uploads/2020/01/2013_CASE-Report_Fan-Control-and-Integrated-Economizers.pdf.
—. 2020 A. Multifamily Domestic Hot Water. September. https://title24stakeholders.com/wp-
content/uploads/2020/09/2022_T24_Final-CASE-Report-MF-DHW-Dist.pdf.
—. 2020 B. "Nonresidential High Performance Envelope." October. https://title24stakeholders.com/wp-
content/uploads/2020/10/2020-T24-NR-HP-Envelope-Final-CASE-Report.pdf.
—. 2021 D. "Nonresidential Indoor Lighting March." March. https://title24stakeholders.com/wp-
content/uploads/2021/03/2022-T24-Indoor-Lighting_Final-CASE-Report_Statewid-CASE-Team_w-
Addendum.pdf.
Statewide IOU Team. 2022. "2019 Restaurants Reach Code Cost-Effectiveness Analysis." 2 18.
file:///C:/Users/mflores/Downloads/2019%20Restaurants%20Cost-eff%20Report%20(10).pdf.
TRC, P2S Engineers, and Western Allied Mechanical. 2022. "2019 Reach Code Cost-Effectiveness Analysis." February
22. https://localenergycodes.com/download/968/file_path/fieldList/2019%20Restaurants%20Cost-
eff%20Report.pdf.
U.S. Department of Energy . 2021. "A National Roadmap for Grid-Interactive Efficient Buildings." May 17.
https://gebroadmap.lbl.gov/A%20National%20Roadmap%20for%20GEBs%20-%20Final.pdf.
U.S. Department of Energy. 2019 B. U.S. Department of Energy. December.
https://www.energy.gov/sites/default/files/2020/02/f72/2019_ssl-energy-savings-forecast.pdf.
—. 2022 A. Prototype Building Models. June 9. https://www.energycodes.gov/prototype-building-models.
WELL. 2022. wellcertified.com. June 9. Accessed June 8, 2022. wellcertified.com.
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8 Appendices
8.1 Map of California CZs
Climate Zone geographical boundaries are depicted in Figure 5 below. An interactive GIS location based map and zip-
code based search directory is available at: Climate Zone tool, maps, and information supporting the California Energy
Code
Figure 5. Map of California CZs
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8.2 Utility Rate Schedules
The Reach Codes Team used the IOU and POU rates depicted in to determine the On-Bill savings for each prototype.
Table 23. Utility Tariffs Analyzed Based on CZ – Detailed View
CZs Utility
Electric Rate (Time of Use) Gas Rate
Medium
Office
Medium
Retail QSR Small Hotel All Prototypes
CZ01 PG&E B-10 B-1 B-1 B-1 or B-10 G-NR1
CZ02 PG&E B-10 B-1 or B-10 B-1 or B-10 B-1 or B-10 G-NR1
CZ03 PG&E B-10 B-1 B-1 B-1 or B-10 G-NR1
CZ04 PG&E B-10 B-1 or B-10 B-1 or B-10 B-1 or B-10 G-NR1
CZ04-2 CPAU E-2 E-2 E-2 E-2 G-2
CZ05 PG&E B-10 B-1 B-1 B-1 or B-10 G-NR1
CZ05-2 SCG B-10 B-1 B-1 B-1 or B-10 G-10 (GN-10)
CZ06 SCE TOU-GS-2 TOU-GS-2 TOU-GS-2 TOU-GS-2 G-10 (GN-10)
CZ07 SDG&E
AL-
TOU+EECC
(AL-TOU)
AL-TOU+EECC
(AL-TOU)
AL-
TOU+EECC
(AL-TOU)
AL-TOU+EECC
(AL-TOU) GN-3
CZ08 SCE TOU-GS-2 TOU-GS-2 TOU-GS-2 TOU-GS-2 G-10 (GN-10)
CZ09 SCE TOU-GS-2 TOU-GS-2 TOU-GS-2 TOU-GS-2 G-10 (GN-10)
CZ10 SDG&E
AL-
TOU+EECC
(AL-TOU)
AL-TOU+EECC
(AL-TOU)
AL-
TOU+EECC
(AL-TOU)
AL-TOU+EECC
(AL-TOU) G-10 (GN-10)
CZ10-2 SCE TOU-GS-2 TOU-GS-2 TOU-GS-2 TOU-GS-2 GN-3
CZ11 PG&E B-10 B-10 B-1 or B-10 B-10 G-NR1
CZ12 PG&E B-10 B-1 or B-10 B-1 or B-10 B-10 G-NR1
CZ12-2 SMUD CITS-1
(CI-TOD 1)
CITS-1
(CI-TOD 1)
CITS-1
(CI-TOD 1) CITS-1 G-NR1
CZ13 PG&E B-10 B-10 B-1 or B-10 B-10 G-NR1
CZ14 SDG&E
AL-
TOU+EECC
(AL-TOU)
AL-TOU+EECC
(AL-TOU)
AL-
TOU+EECC
(AL-TOU)
AL-TOU+EECC
(AL-TOU) G-10 (GN-10)
CZ14-2 SCE TOU-GS-2 TOU-GS-2 TOU-GS-2 TOU-GS-2 or TOU-
GS-3 GN-3
CZ15 SCE TOU-GS-2 TOU-GS-2 TOU-GS-2 TOU-GS-2 G-10 (GN-10)
CZ16 PG&E B-10 B-1 or B-10 B-1 or B-10 B-1 or B-10 G-NR1
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8.2.1 PG&E
Figure 6. PG&E Electric Schedule - B-1
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Figure 7. PG&E Electric Schedule - B-10
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Figure 8. PG&E Gas Schedule – G-NR1
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8.2.2 SCE
Figure 9. SCE Electric Schedule – TOU-GS-1
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Figure 10. SCE Electric Schedule – TOU-GS-2
Page 2009 of 2029
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Figure 11. SCE Electric Schedule – TOU-GS-3
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8.2.3 SCG
Figure 12. SCG Gas Schedule – G-10
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8.2.4 SDG&E
Figure 13. SDG&E Electric Schedule – AL-TOU
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Cost-effectiveness Analysis: Nonresidential New Construction 64
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Figure 14. SDG&E Electric Schedule - EECC
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Figure 15. SDG&E Gas Schedule – GN-3
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8.2.5 CPAU
Figure 16. CPAU Electric Schedule – E-2
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Figure 17. CPAU Gas Schedule – G-2
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8.2.6 SMUD (Electric Only)
Figure 18. SMUD Electric Schedule – CITS-0/CITS-1
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8.2.7 Escalation Rates
Utility rates are assumed to escalate over time, using assumptions from research conducted by Energy and
Environmental Economics (E3) in Appendix 8.2. The 2019 study Residential Building Electrification in California
(Energy + Environmental Economics 2019a) and escalation rates used in the development of the 2022 TDV multipliers
Table 24 below demonstrate the escalation rates used for nonresidential buildings. As stated by E3 in the TDV report,
this latter assumption “does not presuppose specific new investments, changes in load and gas throughput, or other
measures associated with complying with California’s climate policy goals” (i.e., business -as-usual is assumed).
Table 24. Real Utility Rate Escalation Rate Assumptions Above Inflation
Source
Statewide Electric
Nonresidential Average
Rate (%/year, real)
Statewide Natural Gas
Nonresidential Core Rate
(%/year, real)
2023 E3 2019 2.0% 4.0%
2024 2022 TDV 0.7% 7.7%
2025 2022 TDV 0.5% 5.5%
2026 2022 TDV 0.7% 5.6%
2027 2022 TDV 0.2% 5.6%
2028 2022 TDV 0.6% 5.7%
2029 2022 TDV 0.7% 5.7%
2030 2022 TDV 0.6% 5.8%
2031 2022 TDV 0.6% 3.3%
2032 2022 TDV 0.6% 3.6%
2033 2022 TDV 0.6% 3.4%
2034 2022 TDV 0.6% 3.4%
2035 2022 TDV 0.6% 3.2%
2036 2022 TDV 0.6% 3.2%
2037 2022 TDV 0.6% 3.1%
8.3 HVAC and SHW System Cost Scalers
Table 25 shows the material and labor adjustment factors used to determine the costs.
Table 25. Materials and Labor Adjustment Factors by Climate Zone
Materials Labor
CZ 01 0.963 0.994
CZ 02 0.963 1.387
CZ 03 1.001 1.291
CZ 04 0.998 1.298
CZ 05 0.964 0.997
CZ 06 0.960 0.997
CZ 07 0.999 0.985
CZ 08 0.998 0.996
CZ 09 0.964 0.996
CZ 10 0.998 0.996
CZ 11 1.002 0.990
CZ 12 1.000 1.000
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CZ 13 1.000 0.990
CZ 14 0.964 0.980
CZ 15 0.963 0.996
CZ 16 0.967 0.990
Table 26 shows the contractor markup values used to determine the costs.
Table 26. Contractor Markup Values
Contractor 1 Contractor 2
General Conditions and Overhead 15% 20%
Design and Engineering 5% 10%
Permit, testing and inspection 5% 3%
Contractor Profit/Market Factor 10% 10%
8.4 Mixed Fuel Baseline Figures
Table 27. Mixed Fuel Baseline Model – Medium Office
Climate
zone Utility
Annual
Electricity
Consumption
(kWh)
Annual
Natural Gas
Consumption
(therms)
Total
kTDV/ft2
Total TDV
Compliance
kTDV/ft2
Efficiency
TDV
Compliance
kTDV/ft2
GHG
Emissions
Total TDV
Compliance
Margin
Proposed
Elec
Utility
Cost
Proposed
Gas
Utility
Cost tons/yr
CZ01 PG&E 186,894 5,331 130 10 72 63 1 $67,234 $10,377
CZ02 PG&E 163,979 3,253 142 12 107 52 2 $67,798 $6,493
CZ03 PG&E 176,640 2,672 131 5 83 48 1 $67,999 $5,352
CZ04 PG&E 163,768 2,003 125 -2 107 46 1 $68,366 $4,093
CZ04-2 CPAU 163,768 2,003 125 -2 107 46 1 $30,988 $6,966
CZ05 PG&E 170,544 2,575 113 -8 76 46 1 $66,040 $5,156
CZ05-2 SCG 170,544 2,575 113 -8 76 46 1 $66,040 $4,242
CZ06 SCE 163,722 1,066 122 -7 76 39 0 $76,817 $1,980
CZ07 SDG&E 169,611 747 114 -9 76 38 0 $120,127 $1,150
CZ08 SCE 191,703 941 130 -2 76 41 1 $83,752 $1,763
CZ09 SCE 169,514 1,119 135 0 76 41 1 $82,274 $2,046
CZ10 SDG&E 185,682 1,445 141 10 76 45 2 $134,646 $2,113
CZ10-2 SCE 185,682 1,445 141 10 76 45 2 $86,338 $2,474
CZ11 PG&E 209,343 3,309 166 40 136 59 2 $81,001 $6,669
CZ12 PG&E 178,461 2,864 145 19 118 53 2 $72,381 $5,784
CZ12-2 SMUD 178,461 2,864 145 19 118 53 2 $26,576 $5,784
CZ13 PG&E 211,193 2,377 165 37 139 55 2 $81,491 $4,852
CZ14 SDG&E 156,689 3,058 147 13 139 52 3 $128,390 $4,337
CZ14-2 SCE 156,689 3,058 147 13 139 52 3 $83,690 $4,756
CZ15 SCE 209,720 662 161 32 139 47 2 $101,041 $1,311
CZ16 PG&E 177,562 5,799 127 9 94 67 4 $68,281 $11,409
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Table 28. All-electric Baseline Model – Medium Retail
Climate
zone Utility
Annual
Electricity
Consumption
(kWh)
Annual
Natural Gas
Consumption
(therms)
Total
kTDV/ft2
Total TDV
Compliance
kTDV/ft2
Efficiency
TDV
Compliance
kTDV/ft2
GHG
Emissions
Total TDV
Compliance
Margin
Proposed
Elec
Utility
Cost
Proposed
Gas
Utility
Cost tons/yr
CZ01 PG&E 138,367 0 192 110 162 28 -8 $43,917 $0
CZ02 PG&E 131,521 0 211 125 198 28 -15 $50,499 $0
CZ03 PG&E 112,237 0 176 91 156 25 -1 $36,206 $0
CZ04 PG&E 122,256 0 197 111 193 27 -5 $47,522 $0
CZ04-2 CPAU 122,256 0 197 111 193 27 -5 $22,961 $0
CZ05 PG&E 108,753 0 159 76 146 24 -8 $35,179 $0
CZ05-2 SCG 108,753 0 159 76 146 24 -8 $35,179 $0
CZ06 SCE 111,442 0 175 89 146 24 -8 $42,572 $0
CZ07 SDG&E 109,079 0 172 87 146 23 0 $71,108 $0
CZ08 SCE 129,105 0 196 107 146 26 -10 $47,404 $0
CZ09 SCE 123,673 0 193 105 146 26 -3 $46,830 $0
CZ10 SDG&E 114,235 0 174 87 146 25 4 $77,903 $0
CZ10-2 SCE 114,235 0 174 87 146 25 4 $45,763 $0
CZ11 PG&E 144,411 0 229 144 218 30 -6 $54,592 $0
CZ12 PG&E 141,639 0 221 136 211 30 -4 $53,798 $0
CZ12-2 SMUD 141,639 0 221 136 211 30 -4 $21,079 $0
CZ13 PG&E 153,371 0 244 158 236 32 -15 $56,701 $0
CZ14 SDG&E 145,499 0 223 135 236 31 -8 $86,177 $0
CZ14-2 SCE 145,499 0 223 135 236 31 -8 $52,840 $0
CZ15 SCE 146,092 0 244 158 236 29 -24 $56,750 $0
CZ16 PG&E 157,944 0 224 144 214 34 -31 $57,190 $0
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Table 29. Mixed Fuel Baseline Model – Quick-Service Restaurant
Climate
zone Utility
Annual
Electricity
Consumption
(kWh)
Annual
Natural Gas
Consumption
(therms)
Total
kTDV/ft2
Total TDV
Compliance
kTDV/ft2
Efficiency
TDV
Compliance
kTDV/ft2
GHG
Emissions
Total TDV
Compliance
Margin
Proposed
Elec
Utility
Cost
Proposed
Gas
Utility
Cost tons/yr
CZ01 PG&E 63,187 12,237 1,974 820 820 80 5 $20,126 $23,401
CZ02 PG&E 66,343 11,170 1,989 839 839 74 20 $21,332 $21,422
CZ03 PG&E 67,877 10,605 1,922 769 769 71 1 $21,657 $20,336
CZ04 PG&E 77,615 10,277 2,062 910 910 71 -4 $24,931 $19,725
CZ04-2 CPAU 77,615 10,277 2,062 910 910 71 -4 $15,041 $30,442
CZ05 PG&E 69,442 10,655 1,898 744 744 71 -2 $22,105 $20,416
CZ05-2 SCG 69,442 10,655 1,898 744 744 71 -2 $22,105 $14,924
CZ06 SCE 78,813 9,600 1,934 778 744 67 -1 $19,698 $13,599
CZ07 SDG&E 76,653 9,425 1,898 739 744 66 18 $26,903 $13,116
CZ08 SCE 77,418 9,554 1,948 792 744 66 28 $20,356 $13,542
CZ09 SCE 77,625 9,687 1,993 837 744 67 7 $20,405 $13,709
CZ10 SDG&E 81,897 9,907 2,032 877 744 69 26 $31,166 $13,782
CZ10-2 SCE 81,897 9,907 2,032 877 744 69 26 $21,407 $13,986
CZ11 PG&E 85,725 10,748 2,259 1,109 1,109 75 -12 $27,885 $20,664
CZ12 PG&E 74,131 10,726 2,080 928 928 72 2 $24,000 $20,605
CZ12-2 SMUD 74,131 10,726 2,080 928 928 72 2 $11,272 $20,605
CZ13 PG&E 88,060 10,441 2,240 1,089 1,089 73 -2 $28,620 $20,070
CZ14 SDG&E 87,498 10,655 2,251 1,097 1,089 74 -31 $30,692 $14,728
CZ14-2 SCE 87,498 10,655 2,251 1,097 1,089 74 -31 $22,471 $14,925
CZ15 SCE 118,353 9,194 2,444 1,289 1,089 71 -13 $28,746 $13,090
CZ16 PG&E 75,373 12,242 2,143 983 983 82 2 $24,194 $23,494
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Table 30. Mixed Fuel Baseline Model – Small Hotel
Climate
zone Utility
Annual
Electricity
Consumption
(kWh)
Annual
Natural Gas
Consumption
(therms)
Total
kTDV/ft2
Total TDV
Compliance
kTDV/ft2
Efficiency
TDV
Compliance
kTDV/ft2
GHG
Emissions
Total TDV
Compliance
Margin
Proposed
Elec
Utility
Cost
Proposed
Gas
Utility
Cost tons/yr
CZ01 PG&E 230,187 16,824 299 161 173 137 7 $72,520 $32,208
CZ02 PG&E 243,164 13,161 287 152 169 117 5 $77,188 $25,351
CZ03 PG&E 232,511 12,725 272 136 151 113 6 $73,496 $24,461
CZ04 PG&E 251,386 11,608 280 146 165 109 5 $80,034 $22,342
CZ04-2 CPAU 251,386 11,608 280 146 165 109 5 $48,175 $34,218
CZ05 PG&E 232,585 12,375 264 127 143 111 6 $73,479 $23,746
CZ05-2 SCG 232,585 12,375 264 127 143 111 6 $73,479 $17,084
CZ06 SCE 251,627 10,100 260 124 143 100 4 $53,976 $14,227
CZ07 SDG&E 250,625 9,977 257 120 143 100 3 $77,312 $13,878
CZ08 SCE 271,204 9,874 269 136 143 101 3 $60,488 $13,943
CZ09 SCE 265,607 10,246 273 140 143 103 4 $60,896 $14,411
CZ10 SDG&E 276,218 9,903 276 142 143 102 3 $91,917 $13,642
CZ10-2 SCE 276,218 9,903 276 142 143 102 3 $63,534 $13,980
CZ11 PG&E 285,482 12,457 315 179 197 118 4 $82,170 $24,172
CZ12 PG&E 263,561 11,890 293 158 176 112 2 $76,104 $23,029
CZ12-2 SMUD 263,561 11,890 293 158 176 112 2 $34,853 $23,029
CZ13 PG&E 293,124 11,309 310 175 193 113 1 $84,632 $21,924
CZ14 SDG&E 276,292 12,071 298 166 193 115 2 $89,492 $16,232
CZ14-2 SCE 276,292 12,071 298 166 193 115 2 $63,611 $16,703
CZ15 SCE 349,319 7,895 309 174 193 98 -4 $78,507 $11,458
CZ16 PG&E 228,611 17,363 310 170 195 142 9 $72,664 $33,471
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8.5 GHG Savings Summary
This section shows the percent GHG savings for each package. GHG multipliers in CBECC software have utility
emissions multipliers assigned only to each of the California’s sixteen climate zones, does not vary by utility within
each zone. Individual utility assumptions may vary widely. In the Medium Office, the GHG emissions increases in all-
electric package because the proposed all-electric system is electric resistance VAV system instead of a more efficient
heat pump boiler system.
Figure 19. Percentage GHG Savings – Medium Office
Figure 20. Percentage GHG Savings – Medium Retail
Mixed Fuel
EE Code Min EE EE + LF
cz01 0%3%4%12%
cz02 1%0%1%8%
cz03 1%0%1%8%
cz04 2%-1%1%7%
cz05 1%0%2%9%
cz06 2%0%2%8%
cz07 3%0%3%8%
cz08 3%0%2%8%
cz09 2%-1%2%7%
cz10 2%-2%0%6%
cz11 1%-3%-1%5%
cz12 1%-2%-1%5%
cz13 2%-3%-1%4%
cz14 2%-4%-2%5%
cz15 3%-1%2%7%
cz16 1%1%2%7%
CZ All-electric
All-electric
EE Code Min EE
cz01 -4%-2%9%
cz02 -21%-13%10%
cz03 -18%-8%11%
cz04 -14%-5%10%
cz05 -15%-5%12%
cz06 -7%4%13%
cz07 -5%7%14%
cz08 -7%4%12%
cz09 -8%3%13%
cz10 -12%-9%3%
cz11 -23%-21%2%
cz12 -19%-11%9%
cz13 -17%-8%10%
cz14 -15%-5%10%
cz15 -3%0%3%
cz16 -34%-33%2%
Mixed FuelCZ
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Figure 21. Percentage GHG Savings – Quick Service Restaurant
Figure 22. Percentage GHG Savings – Small Hotel
Mixed Fuel
EE Code Min EE EE + LF EE + PV Code Min EE
cz01 10%21%26%28%27%47%52%
cz02 7%16%19%21%21%45%49%
cz03 8%14%20%22%22%45%51%
cz04 7%12%17%19%19%43%49%
cz05 8%14%20%22%22%45%51%
cz06 7%9%15%16%17%43%48%
cz07 6%8%14%15%16%43%48%
cz08 4%9%12%13%14%43%46%
cz09 5%9%12%13%15%43%46%
cz10 5%10%13%14%15%42%46%
cz11 6%13%17%18%18%43%46%
cz12 6%14%17%18%19%44%48%
cz13 6%12%15%16%17%43%46%
cz14 6%13%16%17%18%42%46%
cz15 4%7%9%11%12%40%42%
cz16 8%18%23%24%24%44%49%
All-electric "HS" (HVAC+SHW)CZ All-electric
Mixed Fuel All-electric
EE Code Min EE EE + PV Code Min (PTHP)
cz01 13%47%48%50%47%
cz02 11%42%44%47%43%
cz03 12%43%45%48%43%
cz04 11%41%44%46%42%
cz05 11%43%45%48%43%
cz06 10%41%43%46%41%
cz07 10%41%43%47%41%
cz08 10%40%42%46%40%
cz09 10%40%42%46%40%
cz10 11%37%39%43%37%
cz11 12%39%41%43%39%
cz12 12%38%41%43%39%
cz13 11%37%39%42%37%
cz14 12%38%40%44%38%
cz15 10%33%35%40%33%
cz16 13%43%46%48%45%
CZ
All-electric
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Get In Touch
The adoption of reach codes can differentiate jurisdictions as efficiency leaders and help accelerate the
adoption of new equipment, technologies, code compliance, and energy savings strategies.
As part of the Statewide Codes & Standards Program, the Reac h Codes Subprogram is a resource available to
any local jurisdiction located throughout the state of California.
Our experts develop robust toolkits as well as provide specific technical assistance to local jurisdictions (cities
and counties) considering adopting energy reach codes. These include cost-effectiveness research and
analysis, model ordinance language and other code development and implementation tools, and specific
technical assistance throughout the code adoption process.
If you are interested in finding out more about local energy reach codes , the Reach Code Team stands ready to
assist jurisdictions at any stage of a reach code project.
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Page 2029 of 2029
City Council Public Hearing – September 19, 2023
1
Introduce an Ordinance entitled “AN ORDINANCE OF THE CITY
COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA,
ADOPTING LOCAL AMENDMENTS TO PART 6 OF THE
BUILDING CONSTRUCTION AND FIRE PREVENTION CODE,
2023,” amending San Luis Obispo Municipal Code Chapter
15.04.060 – “Amendments – Energy Standards”.
2
1.Background
2.Proposed Reach Code
3.Next Steps
3
4 4
•Resolution 11159 (2020 Series)adopts a
communitywide goal of carbon neutrality and a building
sector goal of no net new increase of building GHG
emissions as the result of new buildings starting in 2020.
•Ordinance 1717 (2022 Series) adds Chapter 8.11 (All-
Electric Buildings) to the Municipal Code requiring that
all new buildings be all-electric, with certain limited
exceptions.
AGENDA PACKET PAGE #1767
5
•California Restaurant Association v. City of Berkeley ruling said that a
Berkeley ordinance requiring all-electric new buildings was pre-empted by
the federal Energy Policy and Conservation Act of 1975 (EPCA) and was
therefore invalid.
•Administrative Order 01 92023 Series) temporarily suspends enforcement
of the City’s all-electric new building requirements.
•2023-25 Financial Plan Climate Action Major City Goal 4.1.h directs staff
to continue to monitor impacts to Municipal Code 8.11 (All‐Electric New Buildings),
and if necessary, return to Council with an alternative approach to achieving the
City's climate action goals as they relate to new buildings.
AGENDA PACKET PAGE #1767
6
•The California Restaurant Association v.City of
Berkeley appeal is not likely to be resolved in a
timely manner;
•There are no imminent statewide fixes for the
problem
•The City has already started to receive mixed-fuel
building permit applications
AGENDA PACKET PAGE #1767
7
•Adopt increased building energy performance
requirements via local amendments to the California
Energy Code (also known as a “reach code”)
•The California Restaurant Association v.City of
Berkeley decision limits how the City can regulate
emissions
•Local amendments to the California Energy Code
are expressly allowed by state law and are
consistent with federal law
AGENDA PACKET PAGE #1768
8
•The California Energy Code has the benefit of
reducing emissions through regulating energy demand
caused by buildings
•“Reach Code”refers to the local amendments to energy
standards that cost effectively reduce energy from new
buildings in compliance with state and federal law
•"Source energy"represents the underlying fuel sources
such as coal, natural gas or solar used to power building
systems and equipment.
AGENDA PACKET PAGE #1768
9
10
11 11
Building Type Amended Performance Requirement
Single Family Residential buildings Exceed the standard EDR1 requirement
by at least 6 points
Multi-Family Residential (Low)Exceed the standard Source Energy requirement
by 9%
Multi-Family Residential (High)Exceed the standard Source Energy requirement
by 3%
Non-Residential Exceed the standard Source Energy requirement
by 7%
Nonresidential and Multi-Family Residential
Buildings w/Central Water Heating
Illustrate conduit pathway from fuel fired system to
electrical service
12
AGENDA PACKET PAGE #1769
Exceeds the Standard EDR1 Score by at least 6 points
13
Gas Furnace
Standard
Design
Building
Building
Envelope
House Illustration source: Southern California Edison
14
Source
Energy
(EDR1)
+6.0
Building
Envelope
House Illustration source: Southern California Edison
15
Gas Furnace
Standard
Design
Building
Building
Envelope
House Illustration source: Southern California Edison
16
Gas Furnace
Source
Energy
(EDR1)
>6.0
House Illustration source: Southern California Edison
Building
Envelope
17
Standard Design
Building --
Add Heat Pump
HVAC +7%
Keep gas
furnace and add
efficiency and
additional solar
>7%
Office illustration source: Institute for Market Transformation
18
•The City is required to illustrate cost
effectiveness and energy savings
•California Energy Codes and Standards
Statewide Utility program develops cost
effectiveness studies
•The City finds that all of the proposed
local amendments that affect energy use
are:
•More efficient than the base code
•Cost effective on a TDV basis
AGENDA PACKET PAGE #1771
19
•California Electric Homes
•Direct rebates for new all-electric market
rate residential units (including ADUs
and manufactured homes)
•BUILD
•Direct rebates for deed restricted all-
electric affordable housing
•Central Coast Community Energy
•Direct rebates for all-electric affordable
housing and market rate ADUs
•3C-REN
•“Code Coach”support
AGENDA PACKET PAGE #1771
20
•Extensive outreach in 2019, 2020, and 2022.
•In support of the proposed reach code, staff conducted community
outreach as follows:
•Developer’s Roundtable (e.g., developers, architects, engineers, design
professionals, and property owners)
•Green and Healthy Homes Roundtable (e.g., community-based
organizations, technical experts, and key non-profit housing providers)
AGENDA PACKET PAGE #1775
21
22 22
AGENDA PACKET PAGE #1776
Task Timeframe
Second reading of the draft Ordinance
(Attachment A)and submittal to the
California Energy Commission.
October 3, 2023
Receive approval from the California
Energy Commission November -December
Reach code goes into effect January 1, 2024
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Introduce an Ordinance entitled “AN ORDINANCE OF THE CITY
COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA,
ADOPTING LOCAL AMENDMENTS TO PART 6 OF THE
BUILDING CONSTRUCTION AND FIRE PREVENTION CODE,
2023,” amending San Luis Obispo Municipal Code Chapter
15.04.060 – “Amendments – Energy Standards”.
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