VI. Policy Options
The mosaic of current policies affecting the building sector is complex
and dynamic, ranging from local, state, and regional initiatives to a portfolio
of federal policies and programs.
Numerous policy innovations could be added to this mix,
and many are being tried in test beds at the state and local levels.
Various taxonomies have been used to describe policy instruments. Typically these distinguish
between regulations, financial incentives, information and education, management of government energy
use, and subsidies for R&D.
Each of these is described below, first in general terms and then by focus
ing on specific examples that are accompanied by a documented track record of producing cost effective
GHG reductions. These policies offer the potential to deliver significant GHG reductions from the building
sector, both in the short term and continuing well into the mid century.
Regulatory policies include building energy codes, appliance energy
efficiency standards, clean energy portfolio standards, electricity interconnec
tion standards for distributed generation equipment, and land use zoning to
promote smart growth.
Numerous regulatory innovations have been launched at the state and
local levels, including features of California's Title 24 standards, output based air quality permitting stan
dards implemented by Texas, and the Texas energy efficiency portfolio standards that requires a percent
age of the state's growth in electricity consumption be offset by energy efficiency improvements.
The past and potential future role of state building codes and appliance and building equipment
efficiency standards are particularly relevant to the discussion of accelerating the market penetration of
carbon friendly building technologies and practices. Both of these policies address a number of market
failures that exist in the building sector, including the problems introduced by decision making intermedi
aries and the failure of energy prices to incorporate externalities. Evidence to date indicates that they
have been quite successful at promoting cost effective energy efficiency investments, and they appear to
offer considerable potential for generating future GHG reductions.
Towards a Climate Friendly