Savings Total $50 to $295 a Year...
Updated Building Code Could Produce Long-Lasting Benefits

How the New Code Could Save You Energy and Money

The complete study comparing the existing state codes with more recent alternatives http://www.nol.org/home/NEO/ reports/unl_mec_study.htm

The proposed legislation upgrading the state’s building codes http://www.unicam.state.ne.us/ pdf/FINAL_LB888_1.pdf

What would happen if the proposed legislation becomes law? A one-page summary www.nol.org/home/NEO/neq_ online/april2004/ mecqanda.htm
Could Nebraskans benefit from an update of the state’s building code? To find out, the Energy Office commissioned a study, financed with a U.S. Department of Energy Special Projects grant, to search for the answer.

The study examined the cost effectiveness of increasing the state’s residential energy code in new home construction. Nebraska last updated its statewide energy code in 1983.

This study compares the first year and life cycle cost impact of:
  • upgrading Nebraska’s current residential energy code, the 1983 Model Energy Code, to the 2000 International Energy Conservation Code, and
  • upgrading the average residential energy code currently required by local jurisdictions in the state to the 2000 International Energy Conservation Code.
Savings in the Thousands
The findings were clear: An upgrade to the 2000 International Energy Conservation Code from the 1983 Model Energy Code would generate dollar savings from reduced energy use in excess of any mortgage payment increases due to higher construction costs. The difference would mean a Nebraska homeowner could pocket between $50 and $295 a year in savings, depending on where the homeowner lived. Figure A illustrates the savings for four different house sizes in four Nebraska cities.


An upgrade to the 2000 International Energy Conservation Code from the current average code used across the state produced first year net savings in every case, as illustrated in Figure B. While the savings are not as dramatic, they are still compelling: The difference would mean a Nebraska homeowner could pocket between $25 and $124 a year in savings, depending on where the homeowner lived.

Mortgage Costs and Energy Savings after Upgrade from 1983 Model Energy Code to 2000 International Energy Conservation Code
Figure A. Four Cities, Four Houses: Mortgage Costs and Energy Savings after Upgrade from 1983 Model Energy Code to 2000 International Energy Conservation Code
Currently, only 13 of 69 jurisdictions accounting for less than 4 percent of the dwellings constructed in the state have codes equivalent to the 2000 International Energy Conservation Code.

Hundreds of Thousands of Dollars Saved Statewide
Based on statewide housing construction figures, an upgrade from the current state average to the 2000 International Energy Conservation Code would produce a combined first year cost savings of $254,000 for buyers of new homes this year. And their savings will grow in subsequent years as energy costs rise. Over the next thirty years, the houses built during a single year will provide their collective owners with $5.5 million in net savings. These savings would be available to the homeowners for additional expenditures, which could bolster the state’s economy.


After implementation of the 2000 International Energy Conservation Code, savings will continue to grow as more of Nebraska’s housing stock is built to the new standard. Adoption of the 2000 International Energy Conservation Code by the State of Nebraska will result in more than $59.6 million (in 2003 dollars) saved over the life of the houses built before 2015, even if there is no housing growth during this period. Because these savings come from reductions in energy use, adoption of the 2000 International Energy Conservation Code would also help to shield Nebraska homeowners from future fluctuations in energy prices.

Savings Are Compounded
Other benefits to the state included additional investments in construction
cost, which translates to approximately 1.13 million dollars in the first year, benefiting local builders and suppliers while increasing the value of the state’s residential infrastructure. While the new code would require marginally higher construction costs, any increase in mortgage payments is more than offset by the annual energy savings. The actual first year energy savings are $340,000, and will continue to compound each year as more houses are constructed to the upgraded standard. With more than 80 percent of the money Nebraskans spend on energy leaving the state, this savings produces a strong and immediate benefit for the state’s economy. Thus, the code upgrade benefits builders, suppliers, homeowners and the state.

About the Study
The study considered the reduction in energy costs associated with energy code upgrades and compared those savings to any increases in costs of construction required to meet the code. Weather conditions, construction costs and utility rates were considered for four cities selected to represent climate zones in the state: Chadron, McCook, Norfolk, and Omaha.


Annual Mortgage Increase/Decrease and First Year Energy Savings
Figure B. Annual Mortgage Increase/Decrease and First Year Energy Savings — Upgrade from the Current Nebraska Average to 2000 International Energy Conservation Code.
Four houses were modeled for the study: a small ranch style house with 1,453 square feet; a medium ranch style house with 1,852 square feet; a medium two story house with 2,103 square feet; and a large two story house at 2,932 square feet. Occupancy and usage patterns were based on national data for average use.

Details, including how the building components were constructed to meet the various codes, how the state average requirements were determined, development of the usage patterns, economic data used in the cost calculations, the basis for choosing the four cities mentioned above, and the documented sources were included in the full report.
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