New IECC Energy Codes

The Real Estate Espresso Podcast

New IECC Energy Codes

Spotify Google Podcast Apple Podcast Subscribe via RSS Leave a Review

The New IECC Energy Codes: An Understanding for Investors

In today’s dynamic world where energy conservation is the need of the hour, the International Code Council has recently published the 2024 International Energy Conservation Code, a model code that establishes minimum requirements for energy efficiency in residential and commercial buildings. Known as the most adopted energy code nationwide, new energy laws are expected to make residential constructions 7% more efficient and commercial buildings 10% more efficient. The impact of these energy codes may vary across states and jurisdictions, and as responsible investors, we must be aware of these changes as they could affect our investment choices.

Energy Compliance Pathways

The 2024 IECC residential provisions provide three main compliance pathways. The first one, the prescriptive compliance path, mandates compliance with certain requirements. This can be visualized as paint-by-numbers. Building according to these rules may be expensive, but it will assuredly meet the standards.

The second pathway, simulated building performance, leverages energy modeling to estimate the proposed building’s energy costs compared to a reference home. Though complex, this method is cost-effective in the long run. The third pathway utilizes energy modeling to calculate an Energy Rating Index (ERI), which ought to be under the maximum permitted for the climate zone.

Whichever path a developer chooses, their final construction will need a certificate to prove that it adheres to the approved design.

Energy Code Implications and Changes

The newly published 2024 energy code is an improvement from its 2021 predecessor as it recognizes the cost burdens from the 2021 code. This code is created with a pragmatic approach, keeping costs in consideration. Significant changes related to requirements for ceiling insulation and insulation of hot water pipes are mentioned in a six-page document published by the National Association of Home Builders, summarized below:

2021 code	2024 code
Ceiling insulation: R60 and above	Reduced to R49 and R38
Hot water pipes insulation: Minimum R3 value	Changed to 1-inch wrapped insulation

It’s noteworthy to mention that dwelling larger than 5,000 sq ft. of living space may require additional credits. Credits can also be obtained through efficient use of renewable energy in the building site.

The 2024 code will bring in a beneficial change for all real estate investors and developers once adopted by local jurisdictions. Always remember to hire an energy consultant for every new building, and ensure that your building design is cost-effective and energy-efficient.

If you’re a real estate investor or developer interested in learning more about this, consider contacting me for further information.