Bill 25 standoff reveals difficulty in requiring greener energy as part of Oahu’s building code

Improving energy efficiency in residential and commercial buildings is a key element to reducing global climate heating. And on Oahu, there’s plenty of room for improvement, as our built environment is responsible for some 35% of the island’s carbon pollution, according to the city’s recently established greenhouse gas inventory.

The Honolulu City Council is now weighing how much improvement to reach for with Bill 25, which updates the city Energy Conservation Code. The measure adopts the 2017 state Energy Code — based on the latest International Energy Conservation Code — and seeks to fold in Oahu-specific amendments, including two that are touching off intense debate:

>> Renewable hot water heating, which requires that new and substantially remodeled (permit-required) residential single-family homes use solar or an alternate technology that advances renewable energy for at least 90% of energy needed for water heating; and

>> Electric vehicle infrastructure and capability, which requires, in most cases, that at least 25% of parking stalls in new multi-unit residential structures are “EV charger ready,” and that new residences are similarly fitted with wiring and conduit for charging.

The city’s Office of Climate Change, Sustainability and Resiliency is pressing to go above and beyond the state code as a means to shed Hawaii’s ranking as the most petroleum-dependent state in the nation — and to spur progress toward clean energy goals, including the state-mandated 2045 deadline for generating 100% of electricity sales from renewable resources.

“It’s the job of the code to anticipate future changes, 20 to 30 years out,” said Josh Stanbro, the city’s Chief Resilience Officer. “We want to be looking through the front windshield — not the rear-view mirror.”

Echoing that sentiment is the Honolulu Climate Change Commission and green-focused nonprofits like Blue Planet Foundation and the Sierra Club. Opposing the latest draft of Bill 25, however, are some housing industry groups and the developers of Oahu’s two largest new residential projects.

Homebuilders cite costs

In a recent meeting with the Honolulu Star-Advertiser’s editorial board, Bob Bruhl, president of D.R. Horton-Schuler Homes, called the measure a “terrible, terrible rushed plan.” His company is building the masterplanned Ho‘opili community in West Oahu — more than 500 homes of 11,750 planned are completed.

Bill 25, which passed a second City Council reading last month, has twice been held off expected agendas of the Council’s Committee on Zoning, Planning and Housing. It now could get a November final vote before heading to the full Council for action.

Unless some of the proposed code amendments pertaining to residential buildings are reworked, Bruhl said, “There’s no way the (home)buyer wins. … This bill is bad for the resident. It’s bad for 2045.”

Bruhl and others in homebuilding circles contend that in Honolulu, which is among the priciest places nationwide to buy a home — July’s $835,000 median price for a single-family home set a record high — even a slight increase in the price of construction can spell trouble for housing affordability.

In written testimony, Castle & Cooke Homes Hawaii, Inc., estimated that the EV and solar heating amendments would add at least $41 million to the cost of homes in Koa Ridge. Sales for that masterplanned Central Oahu community, which includes 3,500 homes, are set to start within the next year.

Castle & Cooke’s president, Harry Saunders, said, “We question the necessity of making policy that significantly increases the cost of housing in the middle of a housing crisis.” Honolulu Hale has estimated in recent years that upwards of 20,000 affordable units are needed to meet pent-up demand.

Both Koa Ridge and Ho‘opili plan to build about 30% of their homes in “affordable” price range tailored for households earning at least 80% of Honolulu’s area median income. For a two-person household, that’s $77,150; for a family of four, $96,400, according to income limits set by the U.S. Department of Housing and Development.

Lawsuit over loophole

Eleven years ago, when then-Gov. Linda Lingle signed first-in-the-nation legislation to require new homes be built with solar water heaters, the move was hailed as a leap forward for clean energy because water heating accounts for at least one-third of the energy load in most homes.

However, the law’s allotment for exemption in rare cases — inadequate sunlight, a cost-benefit analysis deeming solar water heater installation too expensive and the installation of at least one gas appliance in the home — created a loophole that prompted a lawsuit, filed last year by Earthjustice on behalf of the Sierra Club and Hawaii Solar Energy Association.

In February, a Circuit Court judge ruled that the state Department of Business, Economic Development and Tourism had wrongfully been allowing “wholesale” exemptions from the mandate. In recent years, it had been approving 99% of requests for exemption.

While DBEDT is now sorting out how to move forward, Bill 25 would tighten up the loophole with the requirement of solar or an alternate technology that advances renewable energy. Alternate technology, to be tapped in exemption cases, would include: a grid-interactive water heater; a heat pump water heater; or a gas-powered water heater fueled by a source that’s at least 90% renewable.

The amendment could essentially shut out installation of tankless gas water heaters, which have served as the go-to for state-issued exemption. Saunders said the front-end cost difference between instant gas water heating and solar is about $10,000; and “this cost will be passed on to the homebuyer.”

Further, Bruhl said, in addition to hitting housing affordability, the amendment could result in a clean energy snag. He said if rooftop solar water heater panels are mandatory, photovoltaic (PV), which can power other home appliances such as clothes dryers and kitchen ranges, could be edged out, due in part to limited roof space.

So far, Ho‘opili homes going up on the sun-baked Ewa Plain are being plumbed for PV. However, if handed a perceived double-whammy of a higher price tag for installing solar water heating, along with PV being unable to draw ample sunlight because solar water heating apparatus dominates prime roof space, Bruhl said, “There will be no reason for us at all to plumb the houses for PV.”

In the long term, Bill 25’s backers assert that swapping out fossil-fuel- powered appliances, such as a tankless gas water heater, can yield significant savings and environmental gains.

Over a span of 15 years, according to the city’s estimate, a solar water heater can avoid as much as 29 metric tons of carbon pollution — the equivalent of 67 barrels of imported oil per household. And during that timeframe, opting for a solar, rather than a standard grid resistance water heater, adds up to a cumulative household savings of at least $2,750.

As for stepping up production of gas from renewable sources, Stanbro said, “We’re not leading the charge,” as only 3% of Hawaii Gas’ supply is renewable.

By comparison, prodded by the state’s 2045 mandate, Hawaiian Electric Companies’ supply is expected to hit 30% by 2020 — an increase from its supply of less than 10% a decade ago.

Among jurisdictions leading the charge to more clean energy generation, Stanbro said, is Berkeley, Calif., which in August became the first U.S. city to ban natural gas infrastructure in new buildings. Also on the list is Vancouver, which requires 100% of parking stalls within multiresidential buildings to be EV-ready.

EV-readiness concerns

Opposing Bill 25’s EV requirements, Bruhl and Saunders, along with the Building Industry Association of Hawaii and related groups, argue that since less than 1% of registered vehicles in the islands are EVs, the amendment to the Honolulu’s Energy Conservation code could result in unnecessary hikes in home prices.

“We do our infrastructure planning years in advance,” Saunders said.

The bill’s provision for EV-readiness for at least 25% of parking stalls in new multi-unit residential structures would require a reworking of Koa Ridge design to accommodate the potential power draw “whether anyone uses it or not,” he said. “Then I need to cost that back in.”

Bruhl said that every single- family home in Ho‘opili with an enclosed garage is plumbed for at least “Level 1” or “trickle charging” — by way of a standard 120-volt outlet, and multi-unit structures have at least a few outdoor outlets.

Making 25% of stalls EV-ready likely overshoots demand among multi-unit residents, which includes many households that qualify for affordable housing rates, Bruhl said. Those households, he said, are less likely to be driving EVs because such vehicles cost more than fossil-fuel-burning ones.

Stanbro countered that Bill 25 anticipates that as EV technology continues to evolve, prices will go down. “We don’t want to leave low- and moderate-income people stranded into having a car that costs more to fuel and maintain — and is bad for the environment,” he said.

Further, the bill’s supporters point to studies that have shown that installing EV infrastructure at the time of construction can be about 90% less expensive than post-construction retrofits, and per-stall installation costs can be reduced through economies of scale.

Earlier this month, the latest state energy trend report showed Hawaii surpassing the mark of 10,000 registered passenger EVs. That prompted Blue Planet to note that since Hawaii is the runner-up for highest per-capita EV adoption rate — second to California — more needs to be done to equip multi-unit dwellings.

While Bill 25 requires Level 1 charging power capacity for residences, the nonprofit suggests bumping that up to Level 2, which starts at a 208-volt outlet. The amendment specifies Level 2 for charging in commercial buildings. (For a Nissan Leaf with a range of 226 miles, a Level 1 would fully charge the vehicle in 57 hours; a Level 2, nine hours.)

Two years ago, all four mayors in Hawaii joined Gov. David Ige in pledging to uphold the Paris Agreement — after President Donald Trump announced he would withdraw the U.S. from the international accord to address global warming.

Since then, the mayors have also committed to transforming Hawaii’s ground transportation to 100% renewable fuel sources by 2045.

In regards to follow-through, Stanbro said in testimony, “While we are moving away from fossil fuels toward a decarbonized economy, we are not doing so nearly fast enough. Steps such as updating energy codes are exactly what we need to do if we’re going to keep global temperature rise below 2 degrees Celsius, as called for in the Paris climate agreement.”