A New Federal Energy Efficiency Rule Will Aid New Homeowners

A new federal energy efficiency rule for new construction will help many new homeowners save money on energy costs, beginning next year. The Biden-Harris administration’s adoption of 2021 energy efficiency standards will help many of NC’s new home buyers despite the NC General Assembly’s action halting state regulatory improvements in home construction energy efficiency standards until at least 2030. 

The Impact of the New Rule

The new federal rule will affect home loans financed by the US Dept. of Housing and Urban Development (HUD) or the US Dept. of Agriculture (USDA). HUD and USDA project that the new standards will improve energy efficiency in affected new homes by 37% and cut energy costs on average by more than $950 per year. At that rate, payback times for homeowners are short and–with federal financing–can start immediately. 

The rule is expected to impact more than 1 in 10 new home sales in North Carolina, mostly by lower-income and first-time homebuyers. Government studies show they will pay more for improved efficiency but reap immediate cash-flow benefits from lower monthly utility bills. “The requirements are essential for protecting low-income homebuyers and renters,” said Lowell Ungar, federal policy director of the American Council for an Energy-Efficient Economy, “lowering their energy bills, giving them more comfortable and healthier homes, and protecting them in the climate transition.” 

Ungar and other advocates are pressing for the independent regulator Federal Housing Finance Agency of loan underwriter entities “Freddie Mae” and “Freddie Mac” to adopt the same updated standards. If that effort succeeds, the great majority of new homes in North Carolina would be built to modern energy efficiency standards.

Aid Depends on Election Outcome

There’s an important caveat to this good news: It probably depends on who wins the presidency this fall. If the Trump/Vance ticket wins, the deep-pocketed homebuilder lobby could succeed in having the new rule standard reversed. This is one more example of the critical nature of this year’s elections when it comes to environmental standards essential to acting on the climate crisis.