Reminder – The next BECS committee meeting will be held on Wednesday and Thursday, September 17-18, 2025, at the Homewood Suites in Bozeman. MT. 

AGA and the American Public Gas Association (APGA) Draft Response to the USDA and HUD Request for Comments to Review Requirements for Energy Independence and Security Act of 2007 (EISA) Programs – Comments to AGA by August 5, 2025, please.

As previously reported in the July 18 Update,  the July 7 Federal Register issued by the Department of Housing and Urban Development (HUD) and the Department of Agriculture (USDA) published a notice for comment regarding the Final Determination: Adoption of Energy Efficiency Standards for New Construction of HUD and USDA Financed Housing. In the Notice, the agencies state that they “plan to review the analysis contained in the Final Determination and are seeking public comments to inform the review. As background, HUD and the USDA published a Final Determination on April 26, 2024, adopting the 2021 IECC and ASHRAE 90.1-2019 energy codes as minimum requirements for programs covered under the Energy Independence and Security Act of 2007 (EISA). The agencies are seeking public comments by August 6. The Notice – Request for Comments is specific stating that they are ““considering reexamining the analysis in the Final Determination and are seeking public comment to inform a potential review, consistent with the Executive Action, ‘‘Delivering Emergency Price Relief for American Families and Defeating the Cost-of-Living Crisis.’’  Also, according to the Notice, “The public has had time to begin planning and implementing the Final Determination’s requirements. With that perspective, HUD and USDA would like to better understand how the adoption of the updated codes is working in practice. The agencies welcome comments on any aspect of the Final Determination and also specifically seek comments on the following matters.

1. In the Final Determination, HUD and USDA updated several economic and cash flow factors. The affordability analysis included in the Final Determination reflected the economic landscape around the time of publication. Have any of these factors changed since the publication of the Final Determination? If so, which specific economic factors should be reconsidered and how are they different from the analysis included in the Final Determination?

2. As of April 17, 2025, nine states have adopted the 2021 IECC and 15 states have adopted ASHRAE 90.1–2019 based on DOE’s State Energy Code Adoption map. For builders and developers operating in States that have already adopted the 2021 IECC or ASHRAE 90.1–2019, are you facing any challenges to implementing these building codes?

3. The agencies are interested in feedback from builders who are already building to higher energy performance standards listed on the alternative compliance paths list. What advantages or disadvantages have you seen in the construction of higher performance homes? Please be specific as to the type of housing—owner-occupied single family or entity-owned multifamily rental housing.

4. The agencies seek to provide builders with the most flexibility in meeting current baseline energy performance measures. This includes the list of alternative compliance paths, which responds to the public comments of industry that the IECC 2024 is a preferred code for builders, and it meets or exceeds IECC 2021. The agencies seek to keep this list of alternative compliance paths updated as industry evolves. What other codes or standards are builders and industry aware of beyond the list of proposed alternative compliance paths that meet or exceed the baseline of IECC 2021 that are active in markets and ready for inclusion in the list of alternatives?”

AGA and APGA filed previous comments on concerns with this determination provided in the April 26, 2024, BECS Update. We reported that the HUD and the USDA  final determination  concluded that the 2021 IECC and ASHRAE 90.1– 2019 will not negatively affect the affordability and availability of housing covered by EISA and therefore will be requiring compliance with these standards in HUD and USDA housing financing covered by the Energy Independence and Security Act (EISA). We also noted that in the June 16, 2023  Update on End Use Codes and Standards, we reported that in the May 18, 2023  Federal Register, HUD had issued a notice announcing a “preliminary determination of HUD and USDA Financed Housing , as required under section 481(d)(1) of the Energy Independence and Security Act of 2007 (EISA), that the 2021 IECC and ASHRAE 90.1–2019 will not negatively affect the affordability and availability of housing covered by EISA”. The Notice stated that “In making this preliminary determination, the first step to ultimately requiring compliance with these standards in HUD and USDA housing covered by EISA, this Notice relies on several studies that show that these codes are cost effective in that the incremental cost of the additional efficiency measures pays for themselves with energy cost savings on a life-cycle basis.”  Of particular concern to the natural gas industry and other stakeholders was the statement: “Building Electrification. While the 2021 IECC did not include building electrification provisions in the final version of the code, provisions are available for adoption by states as amendments to the 2021 IECC: RE147–19, Electrification-Ready; RE126–19. Energy Efficient Water Heating, RE107–19, Eliminate Continuous Burning Pilot Light.”  There were other provisions in the 2021 IECC and ASHRAE 90.1–2019 that were reviewed and identified as not adding to energy efficiency improvements or are not cost effective that we contended should be amended prior to HUD and USDA adopting the codes as a basis for funding by these federal agency programs. On August 7, 2023, AGA and APGA filed comments providing our opposition of including “electrification” and provisions that were not cost effective in the 2021 IECC and ASHRAE 90.1–2019 standard. We cited the June, 2021 Home Innovations Research Labs study for the National Association of Home Builders titled 2021 IECC Residential Cost Effectiveness Analysis that identified those specific provisions in the 2021 IECC.  In this Final Determination, we expressed disappointment that although not required for compliance, the  “Building Electrification” provisions were not deleted, and HUD did not agree with the lack of cost effectiveness of the 2021 IECC and ASHRAE 90.1– 2019 and therefore made no adjustments for compliance to those code requirements for HUD and USDA financed housing.  Earlier this year we reported that on January 2, 2025, the National Association of Home Builders (NAHB) and 15 state attorneys general filed a complaint in the Eastern District of Texas seeking to stop HUD and USDA from adopting the 2021 International Energy Conservation Code (IECC) and ASHRAE 90.1-2019 as the minimum energy-efficiency standards for certain single-family and multifamily housing programs. According to the announcement of the lawsuit, NAHB Chairman Carl Harris, a custom home builder from Wichita, Kan., issued the following statement on the lawsuit: “Compliance with the 2021 IECC can add more than $22,000 to the price of a new home, but in practice, home builders have estimated increased costs of up to $31,000. Along with 15 state attorneys general, NAHB is the only private entity in this lawsuit seeking to halt HUD and USDA from adopting the 2021 IECC because home builders can document how this egregious regulation will needlessly raise housing costs and hurt the nation’s most vulnerable home buyers and renters. This ill-conceived policy will act as a deterrent to new construction at a time when the nation desperately needs to boost its housing supply to lower shelter inflation costs. It is also in direct conflict with the current energy codes in the majority of jurisdictions around the country.”  “Our lawsuit seeks to show that granting HUD and USDA authority to insure mortgages for new single-family homes and apartments only if they are built to the 2021 IECC or ASHRAE 90.1-2019 was done in an unconstitutional manner.” Click here to view the litigation document.  In summary, the notice provides an opportunity to seek modifications and recognition of alternate energy conservation programs that provide reasonable and cost-effective programs that HUD and USDA can cite for compliance to their programs.

With this as background, AGA and APGA have prepared the attached draft for resubmittal of our comments on the original HUD and USDA determination and have added additional comments in support of USDA and HUD’s announcement that they plan to review the previous Determination. Please review and provide us with any comments or questions by August 5.

State Codes Activity Update.

Attached is a weekly feature of the “Friday Update” covering state code calendar activities as presented by the online utility “Fiscal Note,” which is sponsored by APGA and AGA Code and Standards. Please review the update and determine if there are state code activities that impact your service territory or organization.