Incremental Construction Cost Incremental Construction Cost Analysis for New Homes

Robin Snyder, Program Directory , gBuilding Codes Assistance Project

Or………Or………

What’s the ’09 IECC going to cost home buyers i ?in my state? 

Why BCAP Conducted the AnalysisWhy BCAP Conducted the Analysis

o Resistance to code adoption based on assumed costs of meeting code

o Uncertainty amongst advocates on the true costs

o DOE report, “Impacts of the 2009 IECC for Residential Buildings at State Level” availableResidential Buildings at State Level  available

o RSMeans data 

Analysis Doesn’t IncludeAnalysis Doesn t Include

o DOE determined eleven states were at oro DOE determined eleven states were at or above ‘09 IECCFour states where DOE could not establish ano Four states where DOE could not establish an energy code equivalent as a starting point/baselinepoint/baseline

o Seven home rule states where DOE d i d i i ibl idetermined it was impossible to approximate a statewide code  

Key FindingsKey Findings

o Weighted Incremental Cost – $818.72 additional cost over life of the mortgage

o Weighted Energy Savings ‐ $243.37 annual g gy g $energy savings

o Bottom line: cost is much lower than claimed by energy code opponentsy gy pp

MethodologyMethodology

o DOE defined construction changes required when o O de ed co st uct o c a ges equ ed emoving to 2009 IECC in each state 

o Energy savings also defined by DOEgy g yo BCAP calculated construction costs using RSMeans including materials, labor, overhead and profit.1. Incremental cost was determined for each climate 

zone in 29 stateszone in 29 states2. State‐specific weighted averages are based on 

number of building permits 

Weighted Average Incremental Cost Explanation

o The weighted average accounts foro The weighted average accounts for construction level in each climate zone, by state and included three data sets:state  and included three data sets:

• New home housing permits by county (US Census)• Climate zone of each county (ICC)y ( )• RS Means location factor (eg. construction costs in some states and cities are higher than others)

o Yielded the most accurate incremental cost for each state  

ResultsResults

For each state where data wasFor each state where data was available, results included:1. Weighted Average1. Weighted Average 

Incremental Cost for state2. Median Energy Savings, 

sourced from DOE3. Simple Payback in years 

(i t l t/ di(incremental cost/median energy savings)

Clarification on Energy Cost Savings

Energy cost factors do not vary by stateEnergy cost factors do not vary by state.

iAssumptions:o Natural gas furnaceo Natural gas price = $1.20/thermo Central electric a/co Central electric a/co Electricity price = $0.12/kWh

Incremental Cost by StateIncremental Cost by StateState Weighted Average

Incremental CostMedian Energy Savings Simple Payback

Alabama 668.76 205.00 3.26

Arizona 559.49 217.00 2.58

Colorado 922.73 239.50 3.85

Connecticut 897.42 235.00 3.82

Georgia 675.36 206.00 3.28

Idaho 872.81 235.50 3.71

Kansas 799.27 260.50 1.71

Kentucky 773.92 336.00 2.30

Louisiana 572.43 188.50 3.04

Massachusetts 910.99 200.50 4.54

Mississippi 646.08 211.50 3.05

Incremental Cost by State (cont.)y ( )State Weighted Average

Incremental CostMedian Energy Savings Simple Payback

Michigan 965 19 274 00 3 52Michigan 965.19 274.00 3.52

Minnesota 1828.20 315.00 5.80

Missouri 875.28 459.00 1.91

Nevada 777.15 228.50 3.40

New Mexico 666.00 233.50 2.85

New York 835.82 259.00 3.23

North Carolina 1129.93 221.50 5.10

North Dakota 903.79 343.00 2.63

Ohio 765.43 229.00 3.34

Pennsylvania 697.79 240.50 2.90

South Carolina 692.74 207.00 3.35

South Dakota 1293.59 405.00 3.19

Utah 935.58 242.00 3.87

Vi i i 582 07 225 00 2 59Virginia 582.07 225.00 2.59

Wisconsin 556.18 220.00 2.53

Wyoming 1280.47 391.00 3.27

Model HouseModel House

Model House SpecificationsModel House SpecificationsModel House – 2,400 Sq. Foot House

Components Sq. Feet

Ceiling 1,200

Window (U Factor/SHGC Factor) 357Window (U Factor/SHGC Factor) 357

Wood Frame Wall 2,380

Floor 1,200

Basement Wall (If Applicable) 1,120

Slab (If Applicable) 1,200

Crawlspace (If Applicable) 1,200

Improved Duct Sealing/Testing Standard Cost

Lighting Standard Cost

Statewide Incremental Cost (Example)

Iowa Incremental Cost Analysis

Iowa Climate Zone 5Components Current 

Practice2009 IECC Change Per 

Sq. FtSq. Feet Location Factor Total 

Change

$ $Ceiling  (R‐Factor) 38 38 0 1,200 $.89 $ 0

Window (U Factor/SHGC Factor)

.35/NR .35/NR 0 357 $.89 $ 0

Wood Frame Wall (R Factor) 19 20 $.19 2,380 $.89 $ 402.46

Floor (R Factor) 30 30 0 1,200 $.89 $ 0

Basement (R Factor) 10/13 10/13 0 1,120 $.89 $ 0

Slab (R Factor) 10, 2 ft 10, 2 ft 0 1,200 $.89 $ 0

Crawlspace (R Factor) 10/13 10/13 0 1,200 $.89 $ 0

Improved Duct Sealing/Testing $ 350

Lighting $ 50

Total $ 802.46

Statewide Incremental Cost (cont.)Statewide Incremental Cost (cont.)

Iowa Incremental Cost Analysis

Iowa Climate Zone 6Components Current 

Practice2009 IECC Change Per 

Sq. FtSq. Feet Location Factor Total 

Change

$ $Ceiling  (R‐Factor) 49 49 0 1,200 $.78 $ 0

Window (U Factor/SHGC Factor)

.35/NR .35/NR 0 357 $.78 $ 0

Wood Frame Wall (R Factor) 19 20 $.19 2,380 $.78 $ 352.72

Floor (R Factor) 30 30 0 1,200 $.78 $ 0

Basement (R Factor) 10/13 15/19 $.40 1,120 $.78 $ 349.44

Slab (R Factor) 10, 4 ft 10, 4 ft 0 1,200 $.78 $ 0

Crawlspace (R Factor) 10/13 10/13 0 1,200 $.78 $ 0

Improved Duct Sealing/Testing $ 350

Lighting $ 50

Total $ 1,102.16

Statewide Incremental Cost (cont.)Statewide Incremental Cost (cont.)

Iowa Incremental Cost Analysis

TotalWeighted Average Incremental Cost (total) $863.69

Estimated Energy Payback (annual) $260.50

Simple Payback (Years) 3 32Simple Payback (Years) 3.32

Future ResearchFuture Research

o Overall cost estimates are conservative.1. RSMeans viewed as a conservative source2. Did not utilize advanced framing techniques (OVE),  

“right‐sizing” of HVAC equipment to account for g g q penvelope improvements, or other innovations

o More sophisticated Cost Benefit Analysis wouldo More sophisticated Cost Benefit Analysis would demonstrate cost to homebuyers is low because incremental costs are amortized in mortgageLooking ahead Costing the proposed IECC 2012o Looking ahead – Costing the proposed IECC 2012 changes.

o Further targeted outreach materials.

First Cost of ‘09 IECC in KYFirst Cost of 09 IECC in KYMonth Homebuyer Cost Utility bill savings Cumulative Savings

1 ($154.78) $28.00 ($126.78)

2 ($3.01) $28.00 ($101.79)

3 ($3 01) $28 00 ($76 80)3 ($3.01) $28.00 ($76.80)

4 ($3.01) $28.00 ($51.81)

5 ($3.01) $28.00 ($26.82)

$ $ $6 ($3.01) $28.00 ($1.83)

7 ($3.01) $28.00 $ 23.16

8 ($3.01) $28.00 $ 48.15

9 ($3.01) $28.00 $ 73.14

10 ($3.01) $28.00 $ 98.13

11 ($3 01) $28 00 $123 1211 ($3.01) $28.00 $123.12

12 ($3.01) $28.00 $148.11

Full ReportFull Report

o Visit bcap‐ocean org click Tools ando Visit bcap ocean.org, click Tools, and “Incremental Cost Analysis”Available Online: Research Summary Fullo Available Online: Research Summary, Full Report, and Excel file with calculations and datadata.

Robin Snyder,Robin Snyder,Program DirectorRsnyder@ase orgRsnyder@ase.org202‐530‐2226