[Federal Register Volume 87, Number 244 (Wednesday, December 21, 2022)]
[Proposed Rules]
[Pages 78382-78436]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-27098]



[[Page 78381]]

Vol. 87

Wednesday,

No. 244

December 21, 2022

Part IV





Department of Energy





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10 CFR Parts 433 and 435





Clean Energy for New Federal Buildings and Major Renovations of Federal 
Buildings; Proposed Rule

  Federal Register / Vol. 87, No. 244 / Wednesday, December 21, 2022 / 
Proposed Rules  

[[Page 78382]]


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DEPARTMENT OF ENERGY

10 CFR Parts 433 and 435

[EERE-2010-BT-STD-0031]
RIN 1904-AB96


Clean Energy for New Federal Buildings and Major Renovations of 
Federal Buildings

AGENCY: Office of Energy Efficiency and Renewable Energy, Department of 
Energy.

ACTION: Supplemental notice of proposed rulemaking.

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SUMMARY: The Department of Energy (``DOE'') is publishing a 
supplemental notice of proposed rulemaking (``SNOPR'') to establish 
revised energy performance standards for the construction of new 
Federal buildings, including commercial buildings, multi-family high-
rise residential buildings, and low-rise residential buildings per the 
Energy Conservation and Production Act (``ECPA''), as amended by the 
Energy Independence and Security Act (``EISA'') of 2007. This document 
presents an updated proposal with a new focus that accounts for the 
needs of Federal agencies and the goals of President Biden's 
Administration and responds to comments received on prior notice of 
proposed rulemaking (``NOPR'') and SNOPR documents. Consistent with the 
requirements of ECPA and EISA, this document presents revised Federal 
building energy performance standards that would require reductions in 
Federal agencies' on-site use of fossil fuels (which include coal, 
petroleum, natural gas, oil shales, bitumens, tar sands, and heavy 
oils) consistent with the targets of ECPA and EISA and provides 
processes by which agencies can petition DOE for the downward 
adjustment of said targets for buildings.

DATES: 
    Meeting: DOE will hold a webinar on Thursday, January 5, 2023, from 
1:00 p.m. to 4:00 p.m. See section VI, ``Public Participation,'' for 
webinar registration information, participant instructions, and 
information about the capabilities available to webinar participants.
    Comments: DOE will accept comments, data, and information regarding 
this SNOPR no later than February 21, 2023. Interested persons are 
encouraged to submit comments using the Federal eRulemaking Portal at 
www.regulations.gov, under docket number EERE-2010-BT-STD-0031. Follow 
the instructions for submitting comments. EERE-2010-BT-STD-0031. 
Alternatively, interested persons may submit comments, identified by 
docket number EERE-2010-BT-STD-0031, by any of the following methods:
    (1) Email: [email protected]. Include the 
docket number EERE-2010-BT-STD-0031 in the subject line of the message.
    (2) Postal Mail: Mr. Jeremy Williams, U.S. Department of Energy, 
Building Technologies Program, Mailstop EE-5B, Fossil Fuel-Generated 
Energy Consumption Reduction for New Federal Buildings and Major 
Renovations of Federal Buildings, EERE-2010-BT-STD-0031 and/or RIN 
1904-AB96, 1000 Independence Avenue SW, Washington, DC 20585-0121. 
Telephone: (202) 586-9138. If possible, please submit all items on a 
compact disc (``CD''), in which case it is not necessary to include 
printed copies.
    (3) Hand Delivery/Courier: Mr. Jeremy Williams, U.S. Department of 
Energy, Office of Energy Efficiency and Renewable Energy, Building 
Technologies Program, EE-2J, 1000 Independence Avenue SW, Washington, 
DC 20585-0121. If possible, please submit all items on a CD, in which 
case it is not necessary to include printed copies.
    No telefacsimiles (``faxes'') will be accepted. For detailed 
instructions on submitting comments and additional information on this 
process, see section VI of this document.

FOR FURTHER INFORMATION CONTACT: 
    Mr. Jeremy Williams, U.S. Department of Energy, Office of Energy 
Efficiency and Renewable Energy, Building Technologies Office, EE-5B, 
1000 Independence Avenue SW, Washington, DC 20585-0121. Email: 
[email protected].
    Mr. Matthew Ring, U.S. Department of Energy, Office of the General 
Counsel, GC-33, 1000 Independence Avenue SW, Washington, DC 20585-0121. 
Telephone: (202) 586-2555. Email: [email protected].
    For further information on how to submit a comment, review other 
public comments and the docket, or participate in the public meeting, 
contact the Building Energy Codes Program staff at 
[email protected].

SUPPLEMENTARY INFORMATION: 
    DOE proposes to incorporate by reference the following industry 
standards:
    ANSI/ASHRAE/IES 90.1-2019, Energy Standard for Buildings Except 
Low-Rise Residential Buildings, I-P Edition, copyright 2019 (``ASHRAE 
90.1-2019''), into part 433.
    ASHRAE 90.1-2019 is available from the American Society of Heating 
Refrigerating and Air-Conditioning Engineers, Inc., 180 Technology 
Parkway NW, Peachtree Corners, GA 30092; (404) 636-8400; 
www.ashrae.org.
    ICC 2021, Redline Version, Copyright 2021, (``IECC 2021'') into 
part 435.
    IECC 2021 is available from the International Energy Conservation 
Code (IECC), 4051 West Flossmoor Road, Country Club Hills, IL 60478, 1-
888-422-7233, or go to https://www.iccsafe.org/.
    See section V.M of this document for a further discussion of these 
standards.

Table of Contents

I. Introduction
    A. Authority
    B. Background
    C. Coverage of the Regulation
II. Discussion of Proposed Standards
    A. Performance Standards for Fossil Fuel-Generated Energy 
Consumption
    B. Compliance With Performance Standards for New Construction 
and Major Renovations of a Whole Building
    C. Compliance With Performance Standards for Major Renovations 
Within a Building
    D. Development of Fossil Fuel-Generated Energy Consumption 
Target
    E. Petitions for Downward Adjustment
    F. Terminology To Be Defined in This Rulemaking
III. Additional Discussion Including Related Comments
    A. Scope and Applicability of the Proposed Rule
    1. Determining the $2.5 Million Threshold for Applicability of 
the Rule
    2. Compliance Date of the Rule
    3. Major Renovations
    4. Multiple Buildings
    5. Leased Buildings
    6. Federal Buildings Overseas
    7. Residential Buildings
    8. Privatized Military Housing
    9. Other Relevant Comments
    B. Establishing and Using the Baseline
    1. CBECS and RECS Baselines
    2. Climate Adjustment
    3. Plug and Process Loads
    4. Differentiating Between Fossil Fuels
    5. Regional Fossil Fuel Factors
    6. Marginal Source of Electricity
    7. Residential Common Areas
    8. Major Renovations
    9. Other Relevant Comments
    C. Methodology To Determine Compliance
    1. Whole Building Simulation
    2. Off-Site and On-Site Renewable Energy and Renewable Energy 
Certificates
    3. Use of Source Energy
    4. Fuel Conversion Efficiency
    5. On-Site Energy Generation From Natural Gas
    6. Other Relevant Comments
    D. Petitions for Downward Adjustment
    1. Technical Impracticability as a Basis for Downward Adjustment
    2. Bundling of Petitions
    3. DOE Review Process
    4. Information Required in Petitions for New Construction
    5. Downward Adjustments for Major Renovations

[[Page 78383]]

    6. Make Information Publicly Available
    7. Narrow the Use of Petitions
    8. GSA Tenant Agencies
    9. Other Relevant Comments
    E. Impacts of the Rule
    1. Cost Impacts
    2. Other Impacts
    F. Guidance and Other Topics
IV. Methodology, Analytical Results, and Conclusion
    A. Cost-Effectiveness
    B. Emissions Analysis
    1. Air Quality Regulations Incorporated in DOE's Analysis
    C. Monetization of Emissions Changes
    1. Monetization of Greenhouse Gas Emissions
    a. Social Cost of Carbon
    b. Social Cost of Methane and Nitrous Oxide
    2. Monetization of Other Emissions Impacts
    D. Conclusion
    E. Reference Resources
V. Procedural Issues and Regulatory Review
    A. Review Under Executive Orders 12866 and 13563
    B. Review Under the Regulatory Flexibility Act
    C. Review Under the Paperwork Reduction Act
    D. Review Under the National Environmental Policy Act of 1969
    E. Review Under Executive Order 13132
    F. Review Under Executive Order 12988
    G. Review Under the Unfunded Mandates Reform Act of 1995
    H. Review Under the Treasury and General Government 
Appropriations Act, 1999
    I. Review Under Executive Order 12630
    J. Review Under the Treasury and General Government 
Appropriations Act, 2001
    K. Review Under Executive Order 13211
    L. Information Quality
    M. Description of Materials Incorporated by Reference
VI. Public Participation
    A. Attendance at the Public Meeting
    B. Procedure for Submitting Prepared General Statements for 
Distribution
    C. Conduct of the Public Meeting
    D. Submission of Comments
VII. Approval of the Office of the Secretary

I. Introduction

    The following section briefly discusses the statutory authority 
underlying this proposed rule, as well as some of the relevant 
historical background related to the establishment of a fossil fuel-
generated energy consumption reduction rule for Federal buildings.

A. Authority

    Section 305 of the Energy Conservation and Production Act 
(``ECPA'') established energy conservation requirements for Federal 
buildings. (42 U.S.C. 6834) Section 433(a) of the Energy Independence 
and Security Act of 2007 (Pub. L. 110-140) (EISA 2007) amended section 
305 of ECPA and directed the Department of Energy (``DOE'') to 
establish regulations that require fossil fuel-generated energy 
consumption reductions for certain new Federal buildings and Federal 
buildings undergoing major renovations. (42 U.S.C. 6834(a)(3)(D)(i)) 
The fossil-fuel generated energy consumption reductions only apply to 
Federal buildings that: (1) are ``public buildings'' (as defined in 40 
U.S.C. 3301) \1\ with respect to which the Administrator of General 
Services is required to transmit a prospectus to Congress under 40 
U.S.C. 3307; \2\ or (2) those that cost at least $2,500,000 in costs 
adjusted annually for inflation. (42 U.S.C. 6834(a)(3)(D)(i))
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    \1\ Under 40 U.S.C. 3301(a)(5), ``public building'' is a 
building, whether for single or multitenant occupancy, and its 
grounds, approaches, and appurtenances, which is generally suitable 
for use as office or storage space or both by one or more federal 
agencies or mixed-ownership Government corporations. ``Public 
building'' includes federal office buildings, post offices, 
customhouses, courthouses, appraisers stores, border inspection 
facilities, warehouses, record centers, relocation facilities, 
telecommuting centers, similar federal facilities, and any other 
buildings or construction projects the inclusion of which the 
President considers to be justified in the public interest. The 
definition does not include a building or construction project that 
is on the public domain (including that reserved for national 
forests and other purposes); that is on property of the Government 
in foreign countries; that is on Native American and Native Alaskan 
property held in trust by the Government; that is on land used in 
connection with federal programs for agricultural, recreational, and 
conservation purposes, including research in connection with the 
programs; that is on or used in connection with river, harbor, flood 
control, reclamation or power projects, for chemical manufacturing 
or development projects, or for nuclear production, research, or 
development projects; that is on or used in connection with housing 
and residential projects; that is on military installations 
(including any fort, camp, post, naval training station, airfield, 
proving ground, military supply depot, military school, or any 
similar facility of the Department of Defense); that is on 
installations of the Department of Veterans Affairs used for 
hospital or domiciliary purposes; or the exclusion of which the 
President considers to be justified in the public interest.
    \2\ 40 U.S.C. 3307 describes the minimum construction, 
alteration and lease costs that would trigger a prospectus to 
Congress.
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    For these buildings, section 305 of ECPA, as amended by EISA 2007, 
mandates that the buildings be designed so that a building's fossil 
fuel-generated energy consumption is reduced as compared with such 
energy consumption by a similar building in fiscal year (``FY'') 2003 
(as measured by Commercial Buildings Energy Consumption Survey 
(``CBECS'') or Residential Energy Consumption Survey (``RECS'') data 
from the DOE's Energy Information Administration (``EIA'') by 55 
percent beginning in FY2010, 65 percent beginning in FY2015, 80 percent 
beginning in FY2020, 90 percent beginning in FY2025, and 100 percent 
beginning in FY2030, also shown in the Table I.1. (42 U.S.C. 
6834(a)(3)(D)(i)(I))

  Table I.1--Building Percentage Reduction Requirements by Fiscal Year
------------------------------------------------------------------------
                                                             Percentage
                        Fiscal year                           reduction
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2010......................................................            55
2015......................................................            65
2020......................................................            80
2025......................................................            90
2030......................................................           100
------------------------------------------------------------------------

    In addition, upon petition by an agency subject to the statutory 
requirements, ECPA, as amended by EISA 2007, permits DOE to adjust the 
applicable numeric reduction requirement downward with respect to a 
specific building, if the head of the agency designing the building 
certifies in writing that meeting such requirement would be technically 
impracticable in light of the agency's specified functional needs for 
that building and DOE concurs with the agency's conclusion. (42 U.S.C. 
6834(a)(3)(D)(i)(II)) Such an adjustment does not apply to the General 
Services Administration (``GSA''). (Id.)
    The term ``fossil fuel-generated energy consumption'' is not 
defined in section 433 of EISA 2007. In this SNOPR, DOE is proposing to 
apply the term ``fossil fuel-generated energy consumption,'' for 
purposes of meeting the reduction targets in EISA section 433, as only 
energy consumption from on-site fossil fuel used by equipment and 
systems designed to support building operations (also referred to as 
Scope 1 uses). In this SNOPR, DOE proposes that these initial standards 
would not cover certain process loads, manufacturing/industrial 
activities, unique research activities or back-up emergency generators 
nor would the standards cover electricity or other purchased utility 
consumption supplied from the grid and generated using fossil fuels 
off-site. However, DOE may re-examine the scope of this term and 
coverage in future updates of these standards.

B. Background

    This SNOPR proposes to amend certain portions of 10 CFR parts 433 
and 435, the regulations governing energy efficiency in Federal 
buildings. DOE previously published a notice of proposed rulemaking 
(``NOPR'') in the Federal Register on October 15, 2010, which outlined 
a proposal to implement section 433 of EISA. 75 FR 63404. A public 
meeting on the NOPR was held on November 12, 2010, and public

[[Page 78384]]

comments were accepted through December 14, 2010. DOE received a number 
of comments expressing concern and encouraging DOE to re-examine the 
proposed regulations.\3\ In response to these comments, DOE identified 
additional areas for clarification and consideration that would benefit 
from further public comment. DOE issued a supplemental notice of 
proposed rulemaking (2014 SNOPR) on October 14, 2014. 79 FR 61694. 
Comments were accepted through December 15, 2014.\4\ To ensure 
alignment with the decarbonization goals of the Biden Administration, 
DOE is revising its proposal and issuing a second SNOPR. This revised 
SNOPR will take into consideration previous relevant comments from the 
2014 SNOPR as well as considerations of Administration objectives to 
reduce emissions across federal operations, as appropriate.
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    \3\ Complete contents of the docket folder may be found at 
www.regulations.gov/#!docketDetail;D=EERE-2010-BT-STD-0031.
    \4\ Id.
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    In this second SNOPR, DOE makes a number of changes from the 2014 
SNOPR that would apply to both 10 CFR part 433 and 10 CFR part 435 
unless otherwise noted. Details of these changes with a discussion of 
each are described in section III of this document. This second SNOPR:
     Converts the proposed rule from a kBtu per ft\2\ 
accounting of total fossil fuel use (including both on-site fossil fuel 
use and the embedded fossil fuels in on-site electricity use) to use 
kBtu per ft\2\ of on-site fossil fuel usage or Scope 1 GHG emissions in 
CO2e (``Carbon Dioxide Equivalent Gases'') per ft\2\.
     Implements a shift multiplier for Federal buildings that 
operate on extended schedules compared to the private sector buildings 
sampled in CBECS. This multiplier will apply solely to Federal 
commercial buildings regulated in 10 CFR part 433 as residential 
buildings of all types in both the private sector and Federal sector 
are assumed to be operated 24 hours a day.
     Revises the calculation of fossil fuel usage for the 
proposed design to make it consistent with how DOE tracks fossil fuel 
usage and greenhouse gas emissions in reporting related to EISA 2007 
section 432.
     Clarifies applicability of the rule to EISA-subject major 
renovations in three categories--renovations of all Scope 1 fossil 
fuel-using systems, Scope 1 fossil fuel-using system level renovations, 
and Scope 1 fossil fuel-using component level renovations.
     Clarifies applicability of the rule to leased facilities, 
noting that the only leases subject to this proposed rule are new 
leases for buildings built specifically for the purpose of being leased 
to the Federal government.
     Clarifies an approach to determine required fossil fuel-
generated energy consumption levels for EISA-subject major renovations 
that are limited to system or component level retrofits.
     Clarifies an alternative compliance method for buildings 
with process loads that are not included in CBECS and RECS.
     Clarifies that process loads of building types not 
included in CBECS are not subject to the fossil fuel reductions, 
including, for example, process loads associated with the charging of 
electric vehicles and the fueling of natural gas fueled vehicles.
     Clarifies that renewable fossil fuels such as biomethane 
and biopropane qualify as exemptions from the calculation of fossil 
fuel usage.
     Clarifies the definition of Scope 1 fossil fuel-generated 
energy consumption as the metric being used for this rule (only 
including consumption for on-site fossil fuel use, not embedded fossil 
fuels in on-site electricity use).
     Clarifies the definition of technical impracticability for 
purposes of the petition process.
     Modifies definitions of major renovations to reflect focus 
on Scope 1 fossil fuel-generated energy consumption and fossil fuel-
using systems as opposed to the whole building fossil-fuel generated 
energy consumption and all building systems.
    Over the past few years, DOE has addressed energy efficiency 
requirements for Federal buildings as mandated in ECPA. DOE published a 
final rule updating Federal building energy efficiency standards for 
commercial or multi-family high-rise residential buildings to ASHRAE 
Standard 90.1-2019 on April 7, 2022. 87 FR 20293. DOE also published a 
final rule updating Federal building energy efficiency standards for 
low-rise residential buildings to the 2021 International Energy 
Conservation Code (``IECC'') on April 5, 2022. 87 FR 19613. Prior to 
that, DOE published a final rule updating the Federal building energy 
efficiency standards for low-rise residential buildings to the 2015 
IECC on January 10, 2017 (82 FR 2857), and a final rule updating 
Federal building energy efficiency standards for commercial and multi-
family high-rise residential buildings to ASHRAE Standard 90.1-2013 on 
November 6, 2015. 80 FR 65749. DOE also published a final rule 
regarding green building certification systems for Federal buildings 
that applied to Federal commercial or multi-family high-rise 
residential buildings and low-rise residential buildings on October 14, 
2014. 79 FR 61563.

C. Coverage of the Regulation

    This SNOPR applies to a defined subset of new Federal buildings and 
major renovations to Federal buildings, as specified in section 433 of 
EISA 2007. (See 42 U.S.C. 6834(a)(3)(D)(i)) The term ``Federal 
building'' means any building to be constructed by, or for the use of, 
any Federal agency, including buildings built for the purpose of being 
leased by a Federal agency, and privatized military housing. (42 U.S.C. 
6832(6)).
    The subset of Federal buildings for which this rule will apply fall 
under two categories and will be referred collectively to as ``EISA-
subject buildings.'' The first qualifying category of EISA-subject 
buildings includes any new Federal buildings or major renovations to 
Federal buildings that are public buildings, as defined in 40 U.S.C. 
3301,\5\ for which transmittal of a prospectus to Congress is required 
under 40 U.S.C. 3307. Under 40 U.S.C. 3307(a)(1), a transmittal of a 
prospectus to Congress is required if a total expenditure in excess of 
$1,500,000 is required to construct, alter, or acquire

[[Page 78385]]

the public building.\6\ Under 40 U.S.C. 3307(h), the GSA Administrator 
may adjust this value annually to account for construction cost 
increases. GSA's annual prospectus threshold for FY 2022 is 
$3,375,000.\7\ GSA also provides a separate dollar threshold for 
alterations in leased public buildings for which a prospectus is 
required. In FY 2022, the cost threshold for alterations in leased 
buildings for public purposes is $1,687,500.
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    \5\ Under 40 U.S.C. 3301(a)(5), ``public building'' is a 
building, whether for single or multitenant occupancy, and its 
grounds, approaches, and appurtenances, which is generally suitable 
for use as office or storage space or both by one or more federal 
agencies or mixed-ownership Government corporations. ``Public 
building'' includes federal office buildings, post offices, 
customhouses, courthouses, appraisers stores, border inspection 
facilities, warehouses, record centers, relocation facilities, 
telecommuting centers, similar federal facilities, and any other 
buildings or construction projects the inclusion of which the 
President considers to be justified in the public interest. The 
definition does not include a building or construction project that 
is on the public domain (including that reserved for national 
forests and other purposes); that is on property of the Government 
in foreign countries; that is on Native American and native Alaskan 
property held in trust by the Government; that is on land used in 
connection with federal programs for agricultural, recreational, and 
conservation purposes, including research in connection with the 
programs; that is on or used in connection with river, harbor, flood 
control, reclamation or power projects, for chemical manufacturing 
or development projects, or for nuclear production, research, or 
development projects; that is on or used in connection with housing 
and residential projects; that is on military installations 
(including any fort, camp, post, naval training station, airfield, 
proving ground, military supply depot, military school, or any 
similar facility of the Department of Defense); that is on 
installations of the Department of Veterans Affairs used for 
hospital or domiciliary purposes; or the exclusion of which the 
President considers to be justified in the public interest.
    \6\ 40 U.S.C. 3307(a) also contains a second prospectus 
threshold in 40 U.S.C. 3307(a)(3) which applies to alterations of 
buildings which are under lease by the Federal Government for use 
for a public purpose if the cost of the alteration will exceed 
$750,000. This threshold is one-half of the threshold for all other 
new construction or alterations of existing buildings.
    \7\ See GSA Annual Prospectus Thresholds at www.gsa.gov/real-estate/design-construction/gsa-annual-prospectus-thresholds.
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    The second qualifying category of EISA-subject buildings covers any 
new Federal buildings or major renovations to Federal buildings that 
are not public buildings and for which the construction cost or major 
renovation cost is at least $2,500,000 (in 2007 dollars, adjusted for 
inflation). Agencies can calculate what that adjusted cost threshold 
would be currently by visiting (https://data.bls.gov/cgi-bin/cpicalc.pl). As noted previously, GSA also provides a separate dollar 
threshold for alterations in leased public buildings ($1,687,500 in 
FY2022). DOE will use both of these thresholds (i.e., the $2,500,000 in 
FY 2007 dollars, and the $1,687,500 in FY2022, each adjusted for 
inflation) for this second category of EISA-subject buildings (i.e., 
buildings for which a prospectus is not required). With respect to the 
threshold for alterations in leased buildings, while section 433 of 
EISA prescribes a $2,500,000 (in 2007 dollars) threshold for major 
renovations for which a prospectus is not required, DOE proposes to use 
the lower GSA prospectus threshold for alterations in leased buildings 
for this second category of EISA-subject buildings because it is 
consistent with: (1) current agency practice for such buildings, and 
(2) the scheme Congress established in EISA section 433 where the 
prospectus dollar thresholds (e.g., $2,500,000 in 2007 dollars) are 
nonetheless applied to buildings and renovations for which a prospectus 
is not required.
    For example, a building in the first category would include a 
federal office building for which design for construction began in FY 
2022 and with construction or renovation costs that are more than 
$3,375,000. A building in the second category would include a 
residential building (which is excluded from the definition of ``public 
building'' under 40 U.S.C. 3301) with construction or renovation costs 
of at least $3,375,000 in FY22 ($2,500,000 (in 2007 dollars, adjusted 
for inflation)). DOE expects that the majority of low-rise residential 
buildings that meet the cost threshold will be low-rise multi-family 
buildings or low-rise dormitories as Federal low-rise single-family 
homes are not likely to meet the cost threshold.
    When identifying major renovation projects within an EISA-subject 
building which could be subject to this regulation because of the cost 
thresholds, agencies should consider any energy conservation measures 
(``ECMs'') which have been identified in that building and reported to 
DOE, as per 42 U.S.C. 8253(f)(3)(A). If identified ECMs include 
projects which would impact on-site fossil fuel usage, the agency 
should consider the total of those project costs bundled together when 
implementing those ECMs to determine whether the total cost triggers 
EISA compliance. ECMs that impact on-site fossil fuel usage may 
include, for example: adding new fossil fuel-using heating, hot water, 
or cooking systems to an existing building; direct replacement of 
existing fossil fuel-using heating, hot water, or cooking systems in an 
existing building; and modification or replacement of any building 
systems (including systems such as lighting or building envelope 
systems that do not use fossil fuel directly) that lead to an increase 
or decrease in fossil fuel use). Such an approach would address a 
situation where individual pieces of on-site fossil fuel consuming 
technology are replaced with similar technologies in a piecemeal 
approach instead of a more strategic and comprehensive way that 
furthers the goals of EISA along with the Administration's priorities 
to reduce Federal agencies' reliance on fossil fuels and reduce on-site 
Federal building emissions.

II. Discussion of Proposed Standards

A. Performance Standards for Fossil Fuel-Generated Energy Consumption

    To provide flexibility while adhering to the statutory origins of 
the rule, DOE is proposing to keep the performance standards for fossil 
fuel-generated energy consumption metric from the 2014 SNOPR (expressed 
in kBtu per ft\2\ of building gross area) while also providing an 
equivalent conversion of the energy metric measured in greenhouse gas 
(GHG) metrics. As mentioned earlier, DOE has chosen to focus on on-site 
fossil fuels or Scope 1 emissions, at least initially. This is a shift 
from the proposed scope of the 2014 SNOPR, which also included 
consideration of off-site fossil fuel consumption. DOE determined to 
focus this rule on onsite fossil fuel use in light of recent Federal 
building initiatives and efforts to address fossil fuel use and 
emissions generated off-site (e.g., Executive Order 14057). DOE may 
address emissions generated off-site (i.e., Scope 2 emissions) at a 
later time.
    This SNOPR provides agencies with two separate but equivalent sets 
of fossil fuel generated energy consumption targets--(1) fossil fuel-
generated energy consumption based on a summation of on-site fossil 
fuel usage expressed in kBtu per ft\2\ of building gross area and (2) a 
new carbon dioxide equivalent (``CO2e'') per ft\2\ metric 
based on the emissions associated with the on-site fossil fuel-
generated energy consumption. Both metrics are based directly on the 
reported usage of fossil fuels in CBECS and RECS, with the fossil fuel-
generated energy consumption metric simply adding up the fossil fuel 
usage and converting it to kBtu and the CO2e metric 
converting the amount of each fuel used to CO2e.
    Agencies will be allowed to use either metric for their design 
targets. DOE opted to include the GHG metric, which will measure Scope 
1 emissions, because agencies are already required to track and report 
their GHG emissions annually utilizing the ``Federal Greenhouse Gas 
Accounting and Reporting Guidance'' (Council on Environmental Quality 
(``CEQ''), January 17, 2016). DOE is proposing to align the 
quantifications and terminologies with those established in the Federal 
Greenhouse Gas Accounting and Reporting Guidance, which categorizes 
Scope 1 emissions into ``Generation of electricity, heat, cooling, or 
steam'', ``Mobile sources'', ``Fugitive emissions'', and ``Process 
emissions''. As mentioned earlier, at this time, DOE is proposing that 
the scope of this rule to be focused only on the on-site fossil fuel 
associated with the ``Generation of electricity, heat, cooling, or 
steam''.
    DOE is proposing two exceptions to the scope of coverage of the 
standards in this SNOPR which differ from how emissions are instructed 
to be tracked by the Federal Greenhouse Gas Accounting and Reporting 
Guidance. First, DOE is proposing to exclude on-site fossil fuel energy 
generation or Scope 1 emissions associated with emergency backup 
generation of electricity from the scope of this rule. The Federal 
Greenhouse Gas Accounting and Reporting Guidance for the category of 
Scope 1 emissions from ``generation of electricity, heat, cooling,

[[Page 78386]]

or steam'' requires tracking and reporting for emergency generators. 
However, DOE intends for agencies to include all on-site fossil fuel 
use or Scope 1 emissions associated with non-emergency generation from 
backup generators (such as those for peak shaving or peak shifting) in 
the scope of this rule. DOE may revisit the issue of whether to include 
these on-site fossil fuel uses in the future. DOE also notes that if 
agencies use their backup generators for both purposes, they will be 
required to calculate what fraction of their backup generator Scope 1 
emissions is associated with emergency use and what fraction is 
associated with non-emergency use.
    Second, DOE proposes to exclude any energy generation or Scope 1 
emissions associated with biomass fuels from this rule, as they are not 
fossil fuel based and thus fall outside the coverage of this rule. DOE 
acknowledges that CEQ's guidance is different on biomass but is 
complimentary to provide additional coverage outside the fossil fuel 
scope mandated by statute for this proposed rulemaking. The Federal 
Greenhouse Gas Accounting and Reporting Guidance, unlike this rule, is 
not limited to fossil fuel-based emissions, and states that Scope 1 
emissions include ``emissions from biomass combusted for production of 
electricity, heat, cooling, or steam''. However, because EISA 2007 
directed DOE to establish regulations that require fossil fuel-
generated energy consumption reductions, and biomass is not a fossil 
fuel, DOE has intentionally left biomass out of the CBECS and RECS 
targets developed for this rule. Agencies therefore would not include 
any energy consumption or Scope 1 emissions from biomass in their 
calculations.
    Also, at this time DOE is focusing the scope of the SNOPR to 
regulate on-site fossil fuel use or Scope 1 on-site emission from 
stationary combustion sources. As such, any emissions associated with 
natural gas for alternatively fueled vehicles (``AFVs'') (or any other 
alternative fuel defined at 42 U.S.C. 13211 that is provided at a 
Federal building) would be excluded from coverage of these standards. 
In addition, for buildings with manufacturing or industrial process 
loads, DOE notes that the CBECS and RECS data that provide the targets 
for this rule do not contain manufacturing or industrial process loads. 
Therefore, DOE proposes to exclude these loads from coverage as well. 
For buildings with such process loads, the process loads will need to 
be accounted for in the analysis of the building's fossil fuel 
consumption and GHG emissions but would not be subject to the 
percentage reductions in fossil fuel-generated energy consumption 
(Scope 1 GHG emissions) required for the building related loads.

B. Compliance With Performance Standards for New Construction and Major 
Renovations of a Whole Building

    DOE has developed quantitative requirements to determine compliance 
with the fossil fuel performance standards for new construction and 
major renovations (i.e., major renovation of all Scope 1 fossil fuel-
using systems in a building) of EISA-subject buildings. Consistent with 
the changes proposed in this SNOPR, DOE is proposing to define the term 
``Major renovation of all Scope 1 fossil fuel-using systems in a 
building,'' which DOE proposes to define as a renovation of all Scope 1 
fossil fuel-using systems on an existing building that is so extensive 
that it replaces all scope 1 fossil fuel-using systems in the building. 
This term includes, but is not limited to, comprehensive replacement or 
restoration of most or all major systems, interior work (such as 
ceilings, partitions, doors, floor finishes, etc.), or building 
elements and features. DOE also refers to such major renovations as 
``whole building'' renovations throughout this preamble.
    The proposed quantitative requirements would require agencies to 
calculate the on-site fossil fuel-generated energy consumption in kBtu 
of fossil fuels or the Scope 1 GHG emissions in CO2e of 
their proposed building design and compare that estimate to the 
allowable fiscal year percentage reduction target found in the target 
tables in appendix A. Per statute (42 U.S.C. 6834), DOE has provided 
three compliance years in this SNOPR, those EISA-subject buildings for 
which the design for construction or major renovation begins in the 
FY2024, FY2025 to FY2029, and for those which the design for 
construction or major renovation begins during or after FY2030.
    Fundamentally, the calculation would require agencies to determine 
the allowable target (in either kBtu of on-site fossil fuels or Scope 1 
greenhouse gas (``GHG'') emissions attributed to the generation of 
electricity, heat, cooling, or steam) for stationary combustion sources 
as per ``Federal Greenhouse Gas Accounting and Reporting Guidance'' 
(Council on Environmental Quality (``CEQ''), January 17, 2016). The 
kBtu values or the metric tons of CO2e from the Scope 1 
emissions can then be divided by the floor area of the building and 
converted to per square foot (metric tons of CO2e per square 
foot) value that can be compared with the target values in appendix A. 
For buildings that combine two or more building types, area-weighted 
averaging by square footage for each building type would be used to 
calculate the maximum allowable fossil fuel-generated energy 
consumption of the combined building.
    For EISA-subject buildings for which design for construction or 
whole building renovation begins in the FY2024 to FY2029, tables of the 
proposed maximum allowable on-site fossil fuel-generated energy 
consumption (expressed in both kBtu per ft\2\ and Scope 1 GHG emissions 
in CO2e per ft\2\) by building type and climate zone are 
provided. The proposed values in the tables come from DOE's EIA CBECS 
(for commercial buildings) and RECS (for multi-family high-rise and 
low-rise residential buildings), both of which are converted from site 
energy consumption to kBtu and Scope 1 GHG emissions in 
CO2e. As noted previously, DOE is proposing to define the 
term ``Major renovation of all Scope 1 fossil fuel-using systems in a 
building'' as a major renovation of all scope 1 fossil fuel-using 
systems in a building that is so extensive that it replaces all scope 1 
fossil fuel-using systems in the building. This term includes, but is 
not limited to, comprehensive replacement or restoration of most or all 
major systems, interior work (such as ceilings, partitions, doors, 
floor finishes, etc.), or building elements and features. DOE also uses 
the term ``whole building renovation'' in reference to these types of 
renovations throughout this preamble.
    For EISA-subject buildings for which design for construction or 
whole building renovation begins in fiscal year 2030 or beyond, the 
fossil fuel-generated energy consumption of the building must be zero 
for all building types and climate zones, based on the calculation 
established in the regulations.

C. Compliance With Performance Standards for Major Renovations Within a 
Building

    To determine compliance with the fossil fuel performance standards 
for major renovations of systems or components within EISA-subject 
buildings, DOE has developed streamlined proposed prescriptive 
requirements. The proposed prescriptive requirements in this case would 
be that the systems within the building undergoing major renovation 
would be brought up to the performance requirements of the individual 
sections of ASHRAE 90.1-2019 (chapters 5-10).

[[Page 78387]]

DOE is not proposing fiscal year timeframes for these requirements to 
apply, but rather, agencies would begin implementing them upon 
effective date of the rule. For major renovations in EISA-subject 
buildings which meet the project cost threshold and coverage 
requirements that are less than whole building renovations (i.e., 
projects within the existing building comprising of retrofits to a 
single system or component such as a HVAC system or a chiller), 
agencies would be required to follow the following prescriptive 
requirements.
    A major renovation within a building is defined as a major 
renovation of a scope 1 fossil fuel-using building system or scope 1 
fossil fuel-using component that provide significant opportunities for 
energy efficiency or reduction in fossil fuel-related energy 
consumption. This includes, but is not limited to, replacement of the 
HVAC system, hot water system, or cooking system, or other fossil fuel-
using systems or components of the building that have a major impact on 
fossil fuel usage. For component level renovations, meaning just a 
product or piece of equipment, agencies would be required to utilize 
electric or non-fossil fuel using Federal Energy Management Program 
(``FEMP'') designated or ENERGY STAR equipment, which follow existing 
Federal requirements for equipment efficiency (found in 10 CFR part 
436, subpart C, ``Agency Procurement of Energy Efficient Products'').
    For system level renovations, agencies would be required to utilize 
electric or non-fossil fuel using FEMP designated or ENERGY STAR 
equipment, in alignment with 10 CFR part 436, subpart C and would also 
be required to meet the system level requirements for the systems being 
renovated in the model energy codes used to establish baseline energy 
efficiency standards for Federal buildings (i.e., the current ASHRAE 
Standard 90.1 for Federal commercial and high-rise multi-family 
buildings covered under 10 CFR part 433 or the current IECC for Federal 
low-rise buildings covered under 10 CFR part 435.)
    While this SNOPR would only cover systems and components that 
utilize on-site fossil fuels, agencies should ensure that projects that 
could have secondary impacts on fossil fuel using equipment, such as 
lighting or window replacement projects are considered. DOE encourages 
agencies to consider whole building optimization for any type of major 
renovation project to ensure no adverse impacts to on-site fossil fuel 
use. DOE also encourages on-site renewables such as solar and storage 
as good practice. DOE is not including on-site solar as a means to 
offset on-site fossil fuel consumption because it will not reduce the 
overall on-site contribution even though it is a means to reduce 
emissions from the electricity use of Federal building. DOE requests 
that agencies provide comments on how to ensure major renovations which 
do not directly replace on-site fossil fuel using equipment could be 
incorporated in this rule (e.g., lighting replacement projects that 
indirectly increase onsite fossil fuel usage through decreased internal 
gains and higher subsequent heating loads).

D. Development of Fossil Fuel-Generated Energy Consumption Target

    To develop the target values in appendix A, DOE utilized CBECS and 
RECS data to determine the on-site fossil fuel usage by fossil fuel 
type for each building in CBECS or RECS and then applied two 
transformations to that data.
    The CBECS and RECS data was parsed into the 19 climate zones used 
in the current Federal baseline standards for commercial and multi-
family high-rise residential buildings, which rely on ASHRAE Standard 
90.1-2019. The same 19 climate zones are used in the current Federal 
baseline standards for low-rise residential buildings, which rely on 
the 2021 IECC.
    The first transformation DOE performed was converting the fossil 
fuel consumption data collected and reported in CBECS and RECS by 
building and by fossil fuel into kBtu, dividing by the building area, 
applying the weighting factors associated with the building, and 
assigning each building to one of the building type/climate zone bins. 
The resulting target is expressed in terms of allowable kBtu per square 
foot by building type and climate zone.
    The second transformation was taking the same fossil fuel 
consumption data reported in CBECS and RECS for each building, 
multiplying the fossil fuel usage for each fuel type by the applicable 
GHG coefficient from the CEQ guidance for each fuel type, dividing by 
the building area, applying the weighting factors associated with the 
building, and assigning each building to one of the building type/
climate zone bins. The resulting target is expressed in terms of 
allowable CO2e (in metric tons of CO2e) per 
square foot by building type and climate zone. The resulting targets 
are shown in appendix A to subpart B of parts 433 and 435 in Table A-1a 
and Table A-1b.

E. Petitions for Downward Adjustment

    Under section 433 of EISA 2007, agencies other than GSA may 
petition DOE for an adjustment to the fossil fuel-generated energy 
consumption requirement with respect to a specific building if meeting 
the requirement is technically impracticable in light of the agency's 
functional needs for the building. The 2014 SNOPR proposed allowing GSA 
tenant agencies with significant control over building design to 
petition DOE, and that proposal is carried forward into this second 
SNOPR. This SNOPR proposes a list of what information would be required 
in a petition for a downward adjustment for a new building and for 
major renovations that are whole building renovations. This includes a 
description of the building and associated components and equipment, an 
explanation of why compliance with the requirements is technically 
impracticable considering the functional needs of the building, a 
demonstration that all cost-effective energy efficiency and on-site 
renewable energy measures were included in the building design, the 
largest feasible reduction in fossil fuel-generated energy consumption 
that can reasonably be achieved, and a description of measures that 
were evaluated but rejected. As proposed, the Director of FEMP will 
review the petition and make a best effort to return the complete 
petition in 45 calendar days of submittal (see 42 U.S.C. 
8253(i)(3)(B)(iv)); incomplete petitions will not be subject to this 
timeframe and may result in delays.
    Additionally, this rulemaking proposes a separate downward 
adjustment process for major renovations that are system or component 
level retrofits. Upon application, a major renovation that is limited 
to a component level retrofit will receive a downward adjustment equal 
to the energy efficiency level that would be achieved through the use 
of products that represent a level of energy efficiency that is life-
cycle cost-effective if such products are commercially available. This 
would be demonstrated using ENERGY STAR or FEMP designated products. 
Upon application, a major renovation that is limited to a single system 
or multiple systems will receive a downward adjustment equal to the 
energy efficiency level that would be achieved through the use of the 
same ENERGY STAR or FEMP designated products as required for component 
renovations and through use of the system level requirements for 
renovations found in the baseline energy efficiency standards in 10 CFR

[[Page 78388]]

part 433 (ASHRAE Standard 90.1-2019) or 10 CFR part 435 (the 2021 
IECC). If the petition only contains component level retrofits for 
adjustment consideration, the Director of FEMP will review the petition 
and make a best effort to return the complete petition within 20 
calendar days of submittal (see 42 U.S.C. 8253(i)(3)(B)(iv)); 
incomplete petitions will not be subject to this timeframe and may 
result in delays. DOE is also considering a separate petition process 
for Department of Defense projects that serve critical national 
security functions. Under this separate process, the head of the agency 
designing the building (or his or her designee) must certify that 
meeting the Scope 1 fossil fuel-based energy consumption targets would 
be technically impracticable because the building, system, or component 
serves a critical national security function and providing basic 
facility or project design information may divulge sensitive national 
security information. The petition must be accompanied by a statement 
that the agency has reduced the fossil fuel-based energy consumption of 
the building, system or component and complied with the other 
requirements of this part to the maximum extent practicable. DOE 
believes this separate process would be protective of critical national 
security projects and information, while also ensuring that DOE meets 
its petition obligations under 42 U.S.C. 6834. However, DOE recognizes 
that the term ``critical national security function'' is potentially 
ambiguous. DOE also recognizes that agencies may need flexibility in 
defining what buildings or projects serve critical national security 
functions, and that a pending petition may delay projects that serve 
critical national security functions.
    DOE requests comment on (i) a separate petition process for 
buildings and projects serving critical national security functions, 
(ii) if and how DOE should define ``critical national security 
functions'', (iii) whether such buildings or projects (or some of them) 
should be exempt from the scope of the proposed rule, and (iv) how 
agencies should use their own discretion in determining what buildings 
or projects serve critical national security functions.

F. Terminology To Be Defined in This Rulemaking

    This SNOPR adds definitions for ``construction cost,'' ``design for 
renovation,'' ``fiscal year (``FY''),'' ``major renovation,'' ``major 
renovation cost,'' ``major renovation of a whole building,'' ``major 
renovation of a building system or component,'' ``multi-family high-
rise residential building,'' and revises the definition for ``proposed 
building.'' For the purposes of establishing the targets, this proposed 
rulemaking establishes the definitions of 16 categories of commercial 
buildings and 5 categories of residential dwelling units which cover 
all residential buildings, including low-rise (single-family and multi-
family), mid-rise apartment buildings, and high-rise apartment 
building.
    The 16 categories of commercial buildings defined are education, 
food sales, food service, health care (inpatient), health care 
(outpatient), laboratory, lodging, mercantile (enclosed and strip 
shopping malls), office, public assembly, public order and safety, 
religious worship (not applicable), retail (other than mall), service, 
and warehouse and storage. Many of these commercial building categories 
are further divided into building types, providing a total of 48 
commercial building types. These building categories and building types 
represent the high-level Principle Building Activity (``PBA'') and low-
level Principle Building Activity Plus categories in the 2003 CBECS.
    The five categories of residential buildings are divided into five 
building/activity types: mobile, multi-family in 2-4-unit buildings, 
multi-family in 5 or more unit buildings, single-family attached, and 
single-family detached. These building types represent the housing unit 
types in the 2005 RECS. Residential buildings that fall under 10 CFR 
part 435 and multi-family mid-rise and high-rise buildings that fall 
under 10 CFR part 433 will use these same categories. For the purposes 
of analysis of the rule, DOE assumes that most multi-family high-rise 
residential buildings will fall into the ``multi-family in 5 or more 
unit buildings'' based on the most typical buildings representative of 
the Federal building.
    Federal agencies would be required to select from these 53 
categories to identify the fossil fuel-generated energy consumption 
target (expressed in both kBtu per ft\2\ and Scope 1 GHG emissions in 
CO2e per ft\2\), for their new construction or building 
undergoing a major renovation. DOE notes that the building types 
available from CBECS and RECS do not correspond directly to the 
building types used in the Federal Real Property Profile (``FRPP''). 
Thus, agencies may need to area-weight the floor space these CBECS and 
RECS targets for Federal buildings that do not correspond directly to 
the CBECS or RECS building types. For example, a DOD Post Exchange 
building might have aspects of Food Sales, Food Service, and 
Mercantile, necessitating the development of an area-weighted target. 
Similarly, a DOD barracks building might include aspects of Lodging or 
Residential, Education, and Warehouse, again necessitating the use of 
an area-weighted mapping.

III. Additional Discussion Including Related Comments

    DOE received 179 comments on the 2014 SNOPR from 27 different 
entities.\8\ The comments were analyzed and categorized into the same 
six major categories used to categorize comments on the NOPR: Scope and 
Applicability of the Proposed Rule, Baseline, Methodology, Impacts, 
Petition for Downward Adjustment, Impacts of the Rule, and Guidance. 
Each major category of comment was broken down into multiple 
subcategories for discussion purposes.
---------------------------------------------------------------------------

    \8\ Comments received on the proposed rule are designated by the 
commenter or commenting organization, the DOE assigned number of the 
individual comment, and the page number of the commenters or 
commenting organizations submission.
---------------------------------------------------------------------------

    DOE believes that many of the prior comments may no longer be 
appropriate or applicable given recent Federal building initiatives 
(e.g., Executive Order 14057) and the significant change in the scope 
of the rule in this second SNOPR. Therefore, in this SNOPR, DOE only 
discusses comments relevant to DOE's current proposal, and only in a 
manner applicable to this proposal. DOE encourages those agencies and 
other stakeholders who commented on the 2014 SNOPR to read this 
proposed rule and provide further comment on this updated proposal.

A. Scope and Applicability of the Proposed Rule

    This section discusses the scope and applicability of the proposed 
rule and the comments received on the 2014 SNOPR regarding that topic. 
The subcategories of comments are determining the $2.5 million 
threshold for applicability of the rule, compliance date of the rule, 
major renovations, multiple buildings, leased buildings, Federal 
buildings overseas, residential buildings, privatized military housing, 
and other relevant comments.
1. Determining the $2.5 Million Threshold for Applicability of the Rule
    DOE received four comments including the Clean Energy Rule'' should 
apply to all new construction without consideration of the $2.5 million 
threshold,'' ``the $2.5 million threshold implies that low-rise 
residential buildings (such as military

[[Page 78389]]

family housing) will not be included,'' ``replace the mention of the 
$2.5 million in 2007 dollars with a table of year by year amounts,'' 
and ``do not use the $2.5 million threshold for major renovations as 
the definition of those renovations already mentions `significant 
opportunities' ''. In light of the comment to provide tables with the 
year-by-year the $2.5 million in 2007 dollars, DOE has provided a link 
to the GSA website where such a table resides. See www.gsa.gov/real-estate/design-construction/gsa-annual-prospectus-thresholds. In 
response to comments suggesting different cost thresholds, the cost 
threshold at 42 U.S.C. 6834(3)(D)(I) forms the basis of the $2.5 
million in 2007 cost threshold. DOE maintained use of this threshold in 
this SNOPR for consistency with the statutory requirement.
2. Compliance Date of the Rule
    DOE received two comments on this topic, including a comment that 
the rule is overdue and another that DOE should finalize this rule only 
when DOE feels that agencies can meet the requirements in the rule, 
especially for the requirements in year 2030 and beyond. DOE is issuing 
this SNOPR with the intent of establishing these standards 
expeditiously. DOE also believes that agencies can now meet the 
requirements of this revised SNOPR as the new proposal would simply 
require elimination of on-site fossil fuel usage in the years 2030 and 
beyond.
3. Major Renovations
    DOE received four comments on the 2014 SNOPR related to major 
renovations, including (1) agencies might break up their renovations 
into smaller pieces to avoid the rule's scope, (2) DOE should eliminate 
requirements for major renovations that involve single components or 
systems, (3) DOE should provide instructions for how to deal with major 
renovations for part of a building, and (4) agreement with DOE's 
previous decision to drop a 25 percent replacement cost threshold that 
appeared in the original NOPR. In response, DOE accepted the first, 
third, and fourth comments, but rejected the second comment. DOE will 
attempt to discourage the possibility of ``breaking up renovation 
projects to get around the cost threshold'' in the guidance document 
that will accompany this rule. DOE notes that section 433 states that 
``[i]n establishing criteria for identifying major renovations that are 
subject to the requirements of this subparagraph, [DOE] shall take into 
account the scope, degree, and types of renovations that are likely to 
provide significant opportunities for substantial improvements in 
energy efficiency.'' 42 U.S.C. 6834(a)(3)(D)(ii). This indicates 
Congressional intent that the term ``major renovations'' should be 
construed broadly to include projects for which agencies can 
practicably implement the energy efficiency and fossil fuel reduction 
goals of ECPA and EISA. DOE believes that major renovations that are 
less than whole building renovations, i.e., component and system level 
renovations, can provide significant opportunities for substantial 
improvements in efficiency and reduction of fossil fuel usage across 
the Federal building portfolio. Accordingly, this proposed rule 
addresses how building systems and components should be addressed if 
only part of the building is renovated, and the requirements for these 
renovations are not based on the whole building targets that apply to 
new construction and major renovations of the whole building.
4. Multiple Buildings
    DOE received one comment in this category supporting DOE's decision 
to apply the $2.5 million threshold to individual buildings rather than 
to multiple buildings in a single project. DOE concludes that the $2.5 
million threshold should apply to individual buildings in order to 
determine whether they are covered buildings under this rule. The 
statute mandates that the requirements apply to ``buildings,'' not 
``projects'' or ``developments.'' (42 U.S.C. 6834(a)(3)(D)(i))
5. Leased Buildings
    DOE asked for and received two comments on leased buildings. One 
comment pointed out that applying this rule to short term leases would 
preclude the use of Utility Energy Service Contracts (``UESCs'') or 
Energy Savings Performance Contracts (``ESPCs''). DOE notes that 
agencies may implement UESCs and ESPCs in leased buildings.\9\ 
Therefore, the rule's requirements would apply to renovations of such 
leased buildings where the cost thresholds are met. However, DOE does 
not anticipate that many, if any, agencies would implement such 
renovations in short-term leases, and expects that most renovations of 
short-term leases would likely fall under the cost thresholds of the 
rule. However, the rule would not apply in cases of Federal agencies 
leasing space in buildings where the entire building is not leased to 
the Federal Government. This proposed rule only applies to major 
renovations of buildings originally built to be leased to the Federal 
Government with the exclusion that if the building at issue is not 
entirely leased to the Federal Government at the time of renovation, 
this proposed rule does not apply. DOE also received a comment 
objecting to DOE removing mention of ``significant design control'' as 
a limitation to the rule. In response to this comment, DOE points out 
that it addressed a similar comment in the issuance of the Green 
Building Certification Rule. (79 FR 61563) In that rule, DOE stated 
that it has not expressly added the significant control restriction to 
the rule for leased buildings because the ECPA definition of Federal 
building is limited to buildings that are built specifically for the 
Federal government. See 42 U.S.C. 6832. Construction design for a 
building built specifically for use of the Federal government, 
including under lease to a Federal agency, is, presumably, under the 
significant control of the Federal owner or Federal lessee. DOE 
reaffirms its previous decision on significant control in this proposed 
rule.
---------------------------------------------------------------------------

    \9\ More guidance on considerations and implementation of ESPCs 
and UESCs in leased spaces may be found on FEMP's web page. For 
ESPCs: https://www.energy.gov/sites/default/files/2022-07/espc_faq_42-usc-8287-0622.pdf. For UESCs: https://www.energy.gov/eere/femp/frequently-asked-questions-about-federal-utility-energy-service-contracts.
---------------------------------------------------------------------------

6. Federal Buildings Overseas
    DOE received no comments on this topic in the 2014 SNOPR. DOE re-
affirms its statement that this proposed rule will apply to the extent 
that the requirements are consistent with applicable law. DOE does not 
intend for the rule to cause any Federal agency to violate other legal 
authorities. This proposed rule does not expressly address the extent 
to which it may be applicable to buildings overseas, as each individual 
agency is best positioned to understand the various and sometimes 
unique authorities that may be applicable to overseas buildings of that 
agency. In applying the proposed rule to any given building, Federal 
agencies must also decide whether the building meets the definition of 
Federal building at 42 U.S.C. 6832(6) and either the requirement that 
the building be a ``public building'' for which a prospectus is 
required, or the requirement that the building or major renovation cost 
at least $2.5 million. (42 U.S.C. 6834(a)(3)(D)(i)).
7. Residential Buildings
    DOE received no comments on residential buildings in the 2014 
SNOPR. Therefore, DOE does not believe any changes to the proposed

[[Page 78390]]

language in the 2014 SNOPR are needed. The statute requires the 
inclusion of all Federal buildings, including residential buildings 
that are EISA-subject buildings.
8. Privatized Military Housing
    DOE received no comments on this topic in the 2014 SNOPR. 
Therefore, DOE will confirm its use of the EISA 2007-modified ECPA 
definition of ``Federal building'' to apply to any building to be 
constructed by, or for the use of, any Federal agency. Such term 
includes buildings built for the purpose of being leased by a Federal 
agency, and privatized military housing. (42 U.S.C. 6832(6)) In 
addition, Congress again mentioned privatized military housing in ECPA 
when it specified that, ``with respect to privatized military housing, 
the Secretary of Defense, after consultation with the Secretary [of 
Energy] may, through rulemaking, develop alternative criteria to those 
established in subclauses (I) [fossil fuel reduction requirements] and 
(III) [sustainable design requirements] of clause (i)'' of section 433 
of EISA. (42 U.S.C. 6834(a)(3)(D)(vi)) Although privatized military 
housing may not meet the definition of ``public building'' at 40 U.S.C. 
3301(a)(5), the rule will apply to privatized military housing with 
construction costs of at least $2.5 million. As described in this 
preamble, this cost threshold applies on an individual building basis.
9. Other Relevant Comments
    DOE received three comments in this category. One comment from 
electric utilities indicated that fossil fuel generated energy 
consumption of a building should only apply to on-site energy 
consumption. DOE agrees with this comment and this proposed rule is 
based solely on on-site fossil fuel usage. A second comment indicated 
that the rule should include all Federal buildings due to the long term 
ecological and economic benefits of the rule. DOE notes that under 
section 433 of EISA 2007, there is a clear limit to the application of 
this rule to larger and costlier buildings and major renovations so DOE 
declines to expand the rule to additional Federal buildings. A third 
comment indicated that the use of energy efficient buildings is not 
only ecologically sound but also of great strategic value, due to the 
increases in energy costs and the reduction of government funds to pay 
for programs and these costs. DOE agrees with this comment.

B. Establishing and Using the Baseline

    This category was divided into nine subcategories: CBECS and RECS 
baselines, climate adjustment, plug and process loads, differentiating 
between fossil fuels, regional fossil fuel factors, marginal source of 
electricity, residential common areas, major renovations, and other 
relevant comments.
1. CBECS and RECS Baselines
    DOE received two comments in this category--one asking if DOE was 
planning to update the rule to refer to the 2012 CBECS when that data 
became available and another questioning the statistical significance 
of the CBECS data when it is split at the building category level. In 
response, DOE notes that EISA 2007 requires the use of 2003 CBECS and 
RECS as a baseline. DOE also notes that because this proposed rule 
includes a gradual increase to 100 percent fossil fuel-based energy 
consumption reduction in 2030, the use of a single, unchanging baseline 
is necessary.
    DOE believes that while there may be some loss of statistical 
significance by using disaggregated building types and climate zones, 
the flexibility the disaggregation provides agencies in terms of 
selecting a building type and climate zone that much more accurately 
reflects an agency's building and its location outweighs the loss of 
statistical significance.
2. Climate Adjustment
    DOE received no comments on this topic in the 2014 SNOPR. 
Therefore, DOE re-affirms its commitment to including fossil fuel-based 
energy consumption reduction targets based on both building type and 
climate zone in the rule.
3. Plug and Process Loads
    DOE requested comments on how the proposed rule could be designed 
such that the assumptions used in the whole building simulations would 
accurately reflect the final building design and operation, including 
plug and process loads. In response, DOE received 15 comments on plug 
and process loads. Given that DOE has revised the scope of this 
proposed rule to apply only to on-site fossil fuel usage associated 
with heating, hot water, generation of electricity, and cooking, 
virtually all these comments are no longer applicable. Plug loads 
(entirely electric) are excluded from this proposed rule. Certain 
process loads that use fossil fuel may be applicable in the petition 
process.
4. Differentiating Between Fossil Fuels
    DOE received several comments on the NOPR about differentiating 
between fossil fuels i.e., natural gas versus crude oil. The comments 
varied, although most favored differentiating between fossil fuels. DOE 
received three comments on the 2014 SNOPR on this topic, with two 
comments agreeing that not differentiating between fossil fuel was 
appropriate and one comment focusing on the source emissions factors 
used by DOE. In response, DOE notes that this proposed rule focuses on 
only on-site fossil fuel emissions. DOE notes that the targets, while 
based on the actual fossil fuels used in CBECS and RECS buildings, are 
expressed only in terms of overall kBtu per ft\2\ of fossil fuels or 
CO2e per ft\2\ of emissions, thus keeping with DOE's 
original intent of not differentiating between fossil fuels. DOE also 
notes that since the rule is now focused on on-site fossil fuel use 
only, the issue of source emission factors for electricity is now less 
important as DOE is no longer proposing to regulate the fossil fuel 
content of electricity used in Federal buildings. DOE does acknowledge 
that the source emission factors related to electricity are used in 
DOE's analysis of the impacts of the rule and that DOE will use the 
latest available source emission factors from DOE and EPA.
5. Regional Fossil Fuel Factors
    DOE indicated in the 2010 NOPR that it was considering a regional 
approach to establishing the fossil fuel fraction associated with 
electricity and asked for comments. In the 2014 SNOPR, DOE decided to 
use the national electric power mix in determining the fossil fuel 
portion of electricity consumption in the rule. DOE received no 
comments on this topic in the 2014 SNOPR, so DOE re-affirms those 
decisions in this second SNOPR. DOE also notes that this issue is much 
less important in this proposed rule as DOE is no longer regulating the 
fossil fuel content of grid electricity used in Federal buildings. DOE 
does acknowledge that the source emission factors related to 
electricity are used in DOE's analysis of the impacts of the rule and 
that DOE will use the latest available source emission factors from DOE 
and EPA.
6. Marginal Source of Electricity
    DOE received a number of comments on this topic in the NOPR and 
proposed in the 2014 SNOPR to not use marginal electric source factors. 
DOE received two comments on this topic in the 2014 SNOPR, both 
agreeing with DOE's decision not to use marginal electrical

[[Page 78391]]

rates. Receiving no other comments, DOE re-affirms its tentative 
decision to not use marginal electricity rates in second SNOPR.
7. Residential Common Areas
    The NOPR stated that the RECS baseline for multi-family residential 
buildings only includes the energy use for individual dwelling units, 
not any associated conditioned common areas. DOE proposed applying the 
RECS-derived fossil fuel requirements to all applicable floor space, 
including both common and non-common areas. Because common areas often 
have a lower energy intensity than individual dwelling units, using 
only non-common areas in the calculation for the proposed design's 
fossil fuel consumption is likely to result in a slightly higher 
maximum allowable fossil fuel-generated energy requirement than using 
both common areas and non-common areas in the calculation. This 
approach will make it easier for building designers to demonstrate 
compliance for a residential building overall. Because common areas 
account for only a small fraction of the floor space in multi-family 
residential buildings, however, the actual effect on fossil fuel 
reductions would be minimal. DOE received no comments on this topic in 
the 2014 SNOPR and re-affirms the approach taken in the NOPR and 2014 
SNOPR in this second SNOPR.
8. Major Renovations
    As noted previously in this document, the CBECS and RECS data that 
provide the baseline for this proposed requirement are building level 
data. For major renovations that are whole building renovations, the 
maximum fossil fuel-generated energy consumption values generated from 
CBECS and RECS provide requirements that are comparable to the energy 
consumption of the whole building renovation. However, DOE believes 
that the maximum consumption levels presented in the proposed tables 
may not be appropriate for major renovations that are system or 
component level retrofits. As such, in the 2014 SNOPR, DOE proposed 
that the requirements for system and component level retrofits be based 
on the percentage of whole building fossil fuel consumption represented 
by the retrofitted system or component. The applicable table value 
would be multiplied by this percentage to arrive at the maximum 
allowable energy use of the retrofitted system or component. DOE 
requested comment on this approach, as well as comment on other 
approaches that could be used to determine the requirement for system 
and component level retrofits. DOE received five comments on this topic 
in the 2014 SNOPR. Comments ranged from agreement with DOE's approach 
to not require major renovations of systems or components to meet the 
full target to opposition to DOE's approach because it did not require 
specific evaluation of the renovation petitions, to comments that DOE 
should expand the scope of the rule to all renovations, even those that 
did meet the cost threshold, and other comments that DOE should apply 
the requirements of ASHRAE Standard 90.1 and the IECC to renovations, 
and comments that DOE should not even consider major renovations that 
do not involve the whole building, but which happen to meet the cost-
threshold.
    In response, DOE notes major renovations are required to be part of 
this proposed rule by statute, and that DOE believes any renovation 
that meets the cost-threshold of the rule and falls within the scope of 
the rule should comply with the rule unless agencies go through the 
petition process for specific considerations of a given project. DOE is 
proposing this approach to allow agencies to take a more holistic view 
of their renovation projects over time, so that projects resulting in 
load reductions (such as insulation improvements) as well as 
electrifying end-uses can be implemented in a complimentary fashion. 
DOE also notes that for major renovations involving only replacement of 
equipment (such as boilers), there is little else DOE can direct 
agencies to do other than to use high efficiency equipment (as is 
required under 10 CFR part 436, subpart C) and to require that that 
equipment uses electricity and not fossil fuels. DOE cannot require 
agencies to renovate other parts of the building. For major renovations 
that involve renovation of individual systems (such as hot water or 
heating, ventilation, and air-conditioning (``HVAC'') systems), DOE is 
requiring agencies to use high efficiency equipment that uses 
electricity and not fossil fuels and meet the renovation requirements 
of the baseline standards in 10 CFR part 433 (ASHRAE Standard 90.1-
2019) or 10 CFR part 435 (the 2021 IECC), as appropriate. DOE notes and 
encourages on-site renewables such as solar and storage as good 
practice.
9. Other Relevant Comments
    Three additional comments were submitted that do not fit into one 
of the scope subcategories. One comment recommended using embodied 
energy in the rule. DOE noted that it was required to use CBECS and 
RECS data per statute and that CBECS and RECS do not contain embodied 
energy. Two other comments recommended that DOE implement a multiplier 
based on hours of operation for Federal buildings that are in operation 
longer than corresponding private sector buildings found in CBECS. DOE 
found these two comments persuasive because many types of Federal 
buildings are operated longer hours than typical buildings covered in 
CBECS and RECS. In addition, DOE notes that hours of operation are 
already considered in tools such as ENERGY STAR Portfolio Manager which 
agencies are required to use as part of their building benchmarking 
activities. (42 U.S.C. 8253(f)(8)) The hours of operation of a building 
are also implicit in any whole building simulation done on a building 
design, with longer hours of operation typically leading to higher 
energy usage. The proposed shift multiplier in this proposed rule is 
based on analysis by Oak Ridge National Laboratory and was originally 
developed for ASHRAE Standard 100-2018 and is expressed in ``number of 
operating shifts'' as opposed to actual hours of operation. Shift 
multipliers provided are both less than and greater than 1 depending on 
building type. For government offices, for example, operating the 
building for 2 shifts does not increase the energy usage, but operating 
the building 3 shifts increases the energy use by a multiplier of 1.4. 
DOE notes that residential buildings, by their very nature, are already 
considered to be 24-hour operation and, therefore, this multiplier will 
only apply to Federal commercial buildings regulated under 10 CFR part 
433.

C. Methodology To Determine Compliance

    DOE categorized comments on the methodology to determine compliance 
in six subcategories: whole building simulation, off-site and on-site 
renewable energy and renewable energy certificates, use of source 
energy, fuel conversion efficiency, and on-site energy generation from 
natural gas. Each of these subcategories is discussed below.
1. Whole Building Simulation
    To determine energy use in the proposed building design, DOE 
proposed in the 2010 NOPR and re-affirmed in the 2014 SNOPR that the 
fossil fuel-generated energy consumption of a proposed new Federal 
building or major renovation of a Federal building be estimated using 
the Performance Rating Method found in Appendix G of ANSI/ASHRAE/IESNA 
Standard 90.1-2004 for commercial and multi-family high-rise 
residential

[[Page 78392]]

buildings, and the IECC 2004 Supplement for low-rise buildings. 75 FR 
63409. Because of the complexity involved in estimating fossil fuel-
generated energy consumption, this requirement would effectively 
require the use of a whole building simulation tool, which can be 
difficult and increases cost.
    In the 2014 SNOPR, DOE recognized that the whole building approach 
is likely not appropriate for major renovations that are limited to 
system or component level retrofits. For major renovations that are 
less than whole building renovations (i.e., system or component level-
retrofits) DOE proposed establishing the maximum allowable fossil fuel 
consumption in fiscal years 2018 through 2029 based on the percentage 
of whole building consumption represented by retrofitted system or 
component. The applicable table value would be multiplied by this 
percentage value to arrive at the maximum allowable fossil fuel 
consumption of the retrofitted system or component. For determining 
compliance, DOE proposed basing the subject fossil fuel-generated 
energy consumption on the system or component as retrofitted. This will 
require the design engineer to estimate both the energy consumption of 
the systems or components as renovated and the energy consumption of 
the entire building as renovated.
    DOE received no comments on the use of whole building simulation, 
but DOE has changed its adopted approach to major renovations to system 
and components in a manner which will no longer require whole building 
simulation, as described in this section. Instead, component and system 
level renovations will be required to use electric or non-fossil fuel 
using FEMP designated or ENERGY STAR equipment and system level major 
renovations will be required to use the same electric or non-fossil 
fuel using FEMP designated or ENERGY STAR equipment and major 
renovation requirements in the baseline standards for 10 CFR part 433 
and 10 CFR part 435. (ASHRAE 90.1-2019 is the current baseline standard 
for 10 CFR part 433 and the 2021 IECC is the current baseline standard 
for 10 CFR part 435.)
2. Off-Site and On-Site Renewable Energy and Renewable Energy 
Certificates
    In the NOPR and 2014 SNOPR for this rule, DOE considered both the 
on-site fossil fuel usage and the fossil fuel use associated with the 
electricity used on site. As part of compliance with the NOPR and 2014 
SNOPR versions of the rule, renewable energy and renewable energy 
certificates were allowed for compliance with this rule. This topic 
area was the single most commented on topic area in the 2014 SNOPR, 
with 51 comments being received. However, given that DOE has chosen to 
refocus this rule on just on-site fossil fuel usage, the entire concept 
of using (or not using) renewable energy or renewable energy 
certificates to meet this rule is no longer relevant. Therefore, DOE 
will not list all the comments related to the use of renewable energy 
and renewable energy certificates from the 2014 SNOPR.
3. Use of Source Energy
    DOE previously made use of source energy for both on-site fossil 
fuel usage and electrical usage in the NOPR and 2014 SNOPR. DOE 
received six comments on this topic in response to the 2014 SNOPR. 
However, with the refocus of the rule to just on-site fossil fuel 
usage, consideration of source energy is no longer relevant. DOE will 
use on-site fossil fuel usage using the directions provided for Federal 
greenhouse gas emission calculation as noted previously in this 
proposed rule. The six comments will not be discussed in this SNOPR.
4. Fuel Conversion Efficiency
    In the NOPR, DOE proposed that the electricity source energy factor 
would be based on the average utility delivery ratio in Table 6.2.4 of 
the 2010 DOE Building Energy Data Book (See https://buildingsdatabook.eere.energy.gov). 75 FR 63410. The ratio accounts for 
fuel conversion losses to produce electricity, as well as transmission 
and distribution losses. DOE used the electricity source energy factor 
of 0.316 from the most recent year data was available, 2008.
    DOE made several definition changes in the 2014 SNOPR and added a 
new source energy multiplier for other fuels. DOE received no comments 
on this topic on the 2014 SNOPR, but DOE has made one further 
refinement to its treatment of fuel conversion efficiency in this 
proposed rule. DOE has added reference to ``coke'' \10\ and used the 
same source energy multiplier as for coal and other fossil fuels. This 
action brings this proposed rule more into alignment with how fossil 
fuel usage is reported to FEMP under the requirements of EISA 2007 
Section 432. The new fuel conversion efficiencies are taken from FEMP's 
Annual Reporting Template for agencies.
---------------------------------------------------------------------------

    \10\ Coke is defined as a solid carbonaceous residue derived 
from low-ash, low-sulfur bituminous coal from which the volatile 
constituents are driven off by baking in an oven at temperatures as 
high as 2,000 degrees Fahrenheit so that the fixed carbon and 
residual ash are fused together. Coke is used as a fuel and as a 
reducing agent in smelting iron ore in a blast furnace.
---------------------------------------------------------------------------

5. On-Site Energy Generation From Natural Gas
    The 2010 NOPR indicated DOE's interest in the effect of the fossil 
fuel-generated energy consumption reduction requirements on distributed 
energy technologies that provide on-site electrical generation from 
natural gas, such as Combined Heat and Power (``CHP'') systems, to 
generate both heat and electricity. A building with a CHP system could 
potentially be an all-gas building in terms of utility purchases and 
would, therefore, be required to reduce natural gas consumption in 
accordance with the fossil fuel-generated energy consumption reduction 
requirements. DOE indicated its interest in minimizing the penalty in 
order to not discourage the use of on-site CHP systems, within the 
limits of the statutory language. DOE invited comments on the NOPR on 
how appropriate credit may be given for CHP systems through the 
compliance determination methodology. 75 FR 63410.
    DOE received several comments related to distributed energy 
technologies on the 2010 NOPR. Based on the comments received and a 
technical review of the issues raised, DOE proposed specificity on how 
CHP and district heating systems should be considered in the 2014 
SNOPR. Under this proposed rule, for district heating or cooling 
systems using fossil fuel as the source, the fossil fuel-generated 
energy consumption would be determined by adjusting the building load 
for the plant fuel conversion efficiency and estimated distribution 
losses as reflected in the Other Fuels Energy Source Multiplier. If a 
non-fossil fuel is used as the sole source (e.g., geothermal) of energy 
for the district heating system, there would be no contribution to 
fossil fuel-generated energy consumption.
    For CHP district heating systems, the electricity attributed to the 
proposed building would be determined by multiplying the building's 
pro-rated share of the total delivered heat from the system times the 
total electricity produced by the CHP system. For CHP systems serving 
only one building, fossil fuel consumption of the CHP system would be 
added to the direct fossil fuel consumption in Equation 1 proposed 
below. Because the electricity is produced from waste heat, the amount 
of electricity produced by either the CHP system serving a single 
building or a CHP district heating system, as determined previously, 
would be

[[Page 78393]]

deducted from the proposed design site electricity in Equation 1 under 
the renewable energy and CHP deduction.
    In response to the 2014 SNOPR, DOE received 22 comments from 
natural gas associations, utilities, and manufacturers of gas turbines 
and fuel cells, most opposing the application of this rule to natural 
gas as doing so would will preclude the use of natural gas in the 
future which is problematic not only because it is an economical and 
environmentally beneficial domestic fuel, but also because doing so 
would be fundamentally inconsistent with the then Administration's 
support of CHP and the then Administration's goals to promote greater 
use of alternative fuels by Federal agencies. This subcategory was the 
second most commented on topic in the 2014 SNOPR.
    In response to these comments, DOE emphasizes, once again, that 
this proposed rule is based directly on congressionally mandated 
language in section 433 of EISA 2007, which governs fossil fuel-
generated energy consumption. DOE notes that the use of natural gas, 
CHP, and alternative fuels is not entirely prohibited by this rule 
(until 2030), although all fossil fuel usage must be accounted for and 
is regulated by this proposed rule.
6. Other Relevant Comments
    DOE received fourteen additional comments relating to methodology 
that did not fit into one of the other subcategories in this larger 
topic. These comments covered potential exclusions for thermal and 
electrical energy storage systems, making this rule be based on an 
agency portfolio (as opposed to on a building-by-building basis), 
exemption of emergency backup systems, exemptions for fuel use for 
alternatively fueled vehicles (``AFVs''), potential credits for nuclear 
and hydropower electricity, and the need to rewrite the main equation 
in the rule.
    In response to the comments about energy storage systems, DOE's 
rewrite of the rule to focus only on on-site combustion of fossil fuels 
makes any discussion of electrical energy storage moot. If agencies 
choose to burn fossil fuels to store heat in a thermal energy storage 
system, that fossil fuel would be counted as part of the consumption of 
the building. DOE notes that this rule applies to individual buildings 
based on statutory requirements, so DOE cannot change this rule to a 
portfolio approach. DOE notes that while emergency backup systems are 
part of the Scope 1 emissions covered by this rule, DOE has implemented 
a specific exemption for emergency backup generators that are used 
solely for emergency backup. Any use of these backup generators for 
peak shaving, peak shifting, or other demand management activities must 
be included in the building consumption.
    With respect to mobile sources, section 433 of EISA refers to the 
fossil fuel-generated energy use of ``Federal buildings.'' 42 U.S.C. 
6834(a)(3)(D)(i). Under ECPA, the term ``building'' means ``any 
structure to be constructed which includes provision for a heating or 
cooling system, or both, or for a hot water system.'' 42 U.S.C. 6832. 
This does not include mobile sources. Accordingly, mobile sources are 
excluded from the scope of this rule. Finally, DOE notes that credits 
for nuclear and hydropower electricity are no longer relevant to this 
proposed rule and that the governing equation in this proposed rule has 
been extensively rewritten and simplified in accordance with the change 
of scope.

D. Petitions for Downward Adjustment

    Upon petition by an agency subject to the statutory requirements, 
ECPA permits DOE to adjust the applicable numeric fossil fuel-generated 
energy consumption percentage reduction requirement downward with 
respect to a specific building, if the head of the agency designing the 
building certifies in writing that meeting the requirement would be 
technically impracticable in light of the agency's specified functional 
needs for the building and DOE concurs with the agency's conclusion. 
(42 U.S.C. 6834(a)(3)(D)(i)(II)) ECPA further directs that such an 
adjustment does not apply to GSA, however, DOE proposes that GSA tenant 
agencies that have design control over their buildings and make 
significant design decisions that will allow for compliance with the 
rule may petition DOE for a downward adjustment, even if that building 
is owned by GSA. DOE also proposes a downward adjustment process for 
new construction and major renovations that are whole building 
renovations, as well as for major renovations that are limited to 
system or component level renovations.
1. Technical Impracticability as a Basis for Downward Adjustment
    Technical impracticability is defined as a situation in which 
achieving the Scope 1 fossil fuel-based energy consumption targets 
would: (1) not be feasible from an engineering design or execution 
standpoint due to existing physical or site constraints that prohibit 
modification or addition of elements or spaces; (2) significantly 
obstruct building operations and the functional needs of a building, 
specifically for industrial process loads, research operations, and 
critical national security functions, mission critical information 
systems as defined in NIST SP 800-60 Vol. 2 Rev. 1; or 3) significantly 
degrade energy resiliency and energy security of building operations as 
defined in 10 U.S.C. 101(e)(6) and 10 U.S.C. 101(e)(7), respectively. 
Upon determination that complying with these standards is technically 
impracticable, the building would still be required to reduce fossil 
fuel consumption to the maximum extent practicable. Technical 
impracticability may include technology availability and cost 
considerations but may not be based solely on cost considerations.
    The 2010 NOPR noted that the downward adjustment provision of ECPA 
does not expressly include cost considerations, but that DOE was 
considering incorporating cost considerations as part of a 
``technically impracticable'' determination. Cost would not be the sole 
rationale for a determination of ``technically impracticable,'' but 
high costs could be part of the evaluation. 75 FR 63412. DOE also 
invited comments on what kind of technical impracticability would 
constitute grounds for a petition for downward adjustment. DOE received 
a number of comments on this topic in the NOPR and restated its 
position in the 2014 SNOPR that cost could not be the sole rationale 
for a determination of ``technically impracticable.'' DOE also 
emphasized in the 2014 SNOPR that it would be appropriate and 
permissible to consider a petition for downward adjustment based on the 
impact to an agency's functional needs for the building of achieving 
the fossil fuel-generated energy consumption reductions. DOE recognizes 
that an agency's functional needs for a building may be inextricably 
linked with costs, but cost should not be the primary basis for a 
petition for downward adjustment. DOE received no further comments on 
this topic in the 2014 SNOPR and thus reaffirms its intent to not allow 
cost as the sole rationale for a determination of technically 
impracticable, but also to consider an agency's functional needs in 
that determination.
2. Bundling of Petitions
    The bundling of petitions was not an issue addressed in the NOPR. 
However, three comments were submitted on whether an agency could 
submit a single petition for downward adjustment for multiple agency 
buildings of the same building type, rather than requiring a petition 
for each building separately, to minimize agency burden.

[[Page 78394]]

    DOE agreed that bundling of petitions by an agency for buildings of 
the same building type and function would help streamline the 
petitioning process and relieve the burden on agencies and DOE by 
avoiding duplication of effort. In the 2014 SNOPR, DOE stated that 
although DOE would require an individual petition containing the 
information required under this proposed rule for each building, if the 
petitions for similar buildings are submitted jointly, a petition may 
reference the downward adjustment justification in another petition in 
the bundle. DOE also noted in the 2014 SNOPR that DOE is considering 
allowing agencies to bundle petitions for new buildings or whole 
renovations to buildings: (1) that are of the same building type and of 
similar size and location; (2) that are being designed and constructed 
to the same set of targets for fossil fuel-generated energy consumption 
reduction; and (3) that would require similar measures to reduce fossil 
fuel-generated energy consumption and similar adjustment to the numeric 
reduction requirement. The bundled petitions should clearly state any 
differences between the buildings and explain why the differences do 
not warrant the submission of separate evaluations. Projects involving 
multiple new buildings would need to submit separate petitions for each 
building if they do not meet criteria (1)-(3) previously listed. For 
component-level major renovations, the 2014 SNOPR stated that DOE is 
considering allowing bundling petitions that are of the same component 
and building type.
    In response, DOE received one comment on bundling of petitions. AGA 
and other utilities supported the concept of bundling of petitions. 
(AGA et al No. 18 at p.6). DOE agrees that bundling of petitions for 
buildings of the same building type and function in a similar location 
is a useful feature of the process and bundling is being proposed. DOE 
encourages agencies to submit a singular petition with all of the 
information on groups of similarly situated buildings to help 
streamline the review process.
3. DOE Review Process
    The 2010 NOPR stated that DOE will review petitions in a timely 
manner and if the petitioning agency has successfully demonstrated the 
need for a downward adjustment per the previous discussion, DOE will 
concur with the agency's conclusion and notify the agency in writing. 
If DOE does not concur, it will forward its reasons to the petitioning 
agency with suggestions as to how the fossil fuel-generated energy 
consumption percentage reduction requirement may be achieved. 75 FR 
63412.
    Several comments were submitted about the DOE review process in the 
NOPR. In response, DOE recognized that agencies want assurance that DOE 
will respond to petitions in a timely manner in order to avoid project 
delays. For petitions for new construction, DOE proposes to make a best 
effort to notify an agency in 45 calendar days of submittal whether a 
petition is approved or rejected, granted the petition is complete. If 
DOE rejects the petition, it would include its reasons for doing so in 
its response to the agency. Additionally, for new construction, DOE 
proposed a provision under which DOE could establish an adjusted value, 
other than the one presented in a petition, if DOE finds that the 
petition does not support the conclusion of the submitting agency but 
that the statutorily required level was nonetheless technically 
impracticable in light of the agency's specific functional needs for 
the building. This provision is intended to provide flexibility in the 
petition process and reduce the need for agencies to resubmit in the 
instance of a rejection. For petitions for downward adjustments to the 
requirements applicable to major renovations, DOE proposed that the 
downward adjustment would be granted upon submission of specified 
certifications. The necessary certifications are discussed in greater 
detail in section III.D.5 in this document. In response, DOE received 
five comments on its review process.
    The Department of Defenses (``DOD's'') Office of the Under 
Secretary of Defense (``OUSD'') \11\ and the Office of the Deputy Under 
Secretary of Defense (Installations and Environment) (``ODUSD(I&E)'') 
stated that regardless of project type, all petitions for downward 
adjustments should be deemed approved upon submittal to DOE. (OUSD-AF 9 
at p.6 and ODUSD(I&E) 16 at p.4) In response, DOE notes that approving 
all petitions for downward adjustment without reviewing the petitions 
to ensure that the Secretary of DOE concurs with the petition would be 
contrary to the statutory requirement that DOE review and concur on 
each petition submitted. (42 U.S.C. 6834(a)(3)(D)(i)(II)) The American 
Gas Association (``AGA'') and other utilities commented that they 
support DOE's proposed review process (AGA et al No. 18 at p.6) and 
they also requested that DOE consider the cost-effectiveness of fossil 
fuel energy reduction measures to the greatest extent possible in the 
downward reduction process. (AGA et al No. 17 at p.6) In response, DOE 
notes that the statutory requirement for adjusting the fossil fuel-
generated energy consumption requirements is technical 
impracticability. As previously noted, DOE will consider cost and cost-
effectiveness through that lens; however, cost or cost-effectiveness 
impacts cannot be the only reason a petition is approved. (See section 
E.1 of this proposed rule for additional discussion of cost.)
---------------------------------------------------------------------------

    \11\ OUSD submitted 4 sets of comments--one set on behalf of the 
Air Force (marked ``-AF''), another set on behalf of the U.S. Army 
Corps of Engineers (marked ``-USACE''), a third set on behalf of the 
Army (marked ``-Army''), and a final set on behalf of OUSD's 
Facility Energy and Privatization director (marked ``-FEP'').
---------------------------------------------------------------------------

    Earthjustice noted that despite mention in the preamble, the 
regulatory text of the 2014 SNOPR fails to recognize that, to evaluate 
petitions for downward adjustments, DOE needs a description of all 
technologies and practices that an agency evaluated and rejected, 
including a justification as to why the technologies were not included 
in the design. (Earthjustice No. 4 at p.3)
    DOE agrees with Earthjustice with respect to documentation 
requirements for downward petitions for whole building renovations. 
This documentation should be identical to that required for new 
construction petitions. This change was made in this proposed rule. DOE 
expanded the type of building specific information that DOE is 
requesting in petitions as requested by Earthjustice but is doing so in 
a manner that allows DOE to analyze what possibilities each petitioner 
has to meet the rule in its renovation. DOE changed the rule to require 
the director of FEMP to approve each petition after reviewing this 
building-specific information.
4. Information Required in Petitions for New Construction
    The NOPR proposed that a petition for downward adjustment of the 
numeric requirement should include an explanation of what measures 
would be required to meet the fossil fuel-generated energy consumption 
reduction requirement, and why those measures would be technically 
impracticable in light of the agency's specified functional needs for 
the building. DOE also proposed that the petition should demonstrate 
that the adjustment requested by the agency represents the largest 
feasible reduction in fossil fuel-generated energy consumption that can 
reasonably be achieved. DOE solicited comments on those issues. 75 FR 
63412.
    DOE received several comments on the NOPR and provided more 
detailed

[[Page 78395]]

petition requirements in the 2014 SNOPR that allows DOE to determine 
more comprehensively whether a downward adjustment should be approved. 
DOE proposed a modified provision that requires a Federal agency to 
demonstrate that the requested adjustment represents the largest 
feasible fossil fuel reduction that the agency can reasonably achieve 
by providing evidence that the agency included all life-cycle cost-
effective energy efficiency and on-site renewable energy measures in 
the design and by providing a description of the technologies and 
practices that the agency evaluated and rejected, including a 
justification as to why these technologies and practices were rejected. 
Finally, agencies would also be permitted to provide additional 
information they think will help justify the request for downward 
adjustment.
    As per the 2014 SNOPR, petitions would also be required to include 
the maximum allowable fossil fuel-generated energy consumption for the 
proposed building, the estimated fossil fuel-generated energy 
consumption of the proposed building, the total estimated project cost, 
and a description of the building and the building energy systems. A 
description of the building would include, but would not be limited to, 
location, use type, floor area, stories, expected number of occupants 
and occupant schedule, and functional needs of the building, and any 
other information the agency deems pertinent. The building energy 
Federal agencies must describe includes the HVAC systems and service 
water heating system, as well as the loads in the building, including 
any specialized process, specialized research loads, electric vehicle 
charging stations, alternatively fueled vehicle fueling stations, and 
emergency backup generators. This information should provide DOE the 
necessary information to review petitions, and help agencies ensure key 
questions and options are addressed in the design process.
    DOE received one comment on the information required in petitions 
for new construction. An individual commenter suggested that to 
discourage excessive petitions for downward adjustment, DOE should 
require a comprehensive analysis of the selected and rejected energy 
efficiency measures or technologies, similar to methods employed in a 
Level II energy audit as defined by the American Society of Heating, 
Refrigeration and Air-Conditioning Engineers (``ASHRAE''). In response, 
DOE notes that Federal agencies are already required to perform audits 
on 25 percent of their buildings every year under the provisions of 
section 432 of EISA 2007. DOE believes that dividing major renovations 
into three categories that each have their own threshold for DOE 
granting of a petition for downward adjustment (e.g., whole building 
renovations, system level renovation, and component level renovations) 
should keep the number of petitions submitted by agencies to a minimum.
5. Downward Adjustments for Major Renovations
    As noted previously, for major renovations, DOE proposes that the 
fossil fuel reduction requirements apply only to the energy use 
associated with the portions of the building or building systems that 
are being renovated and only to the extent that the scope of the 
renovation provides an opportunity for compliance with the applicable 
fossil fuel-generated energy consumption reduction requirements.
    Recognizing the practical limitations on improving energy 
efficiency through retrofits, DOE proposes separate downward adjustment 
processes for major renovations. For major renovations that are whole 
building renovations, a downward adjustment will be provided at a level 
equal to the energy efficiency level that would be achieved were the 
proposed building designed to meet the baseline energy efficiency 
standard applicable to new construction in 10 CFR parts 433 or 435. DOE 
proposed in the 2014 SNOPR that this adjustment would be available to 
GSA-tenant agencies with significant control over building design and 
DOE re-affirms this proposal.
    The energy efficiency standards for new construction are 
established in 10 CFR part 433, for commercial and multi-family high-
rise residential buildings, and 10 CFR part 435, for low-rise 
residential buildings. The energy efficiency standards require a 
building be designed to, at minimum, achieve the energy efficiency 
levels of the applicable referenced voluntary consensus code: ASHRAE 
90.1 for commercial buildings multi-family high-rise residential 
buildings and IECC for low-rise residential buildings. The energy 
efficiency standards for new Federal buildings further require that 
buildings be designed to achieve energy efficiency levels that are at 
least 30 percent beyond the levels established in the referenced codes, 
if life-cycle cost-effective.
    For major renovations that are limited to system or component level 
retrofits, DOE proposed in the 2014 SNOPR to provide downward 
adjustments at a level equal to the energy efficiency level that would 
be achieved through the use of commercially available systems and/or 
components that provide a level of energy efficiency that is life cycle 
cost effective, i.e., ENERGY STAR or FEMP designated products. For 
system level renovations, agencies would adopt as renovation 
requirements the relevant parts of new building baseline energy 
efficiency standard in 10 CFR part 433 or 435 on a system level (i.e., 
brought up to the performance requirements of the individual sections 
of ASHRAE 90.1-2019 (chapters 5-10)) where appropriate and cost 
effective, and additionally would follow the replacement guidance for 
all equipment that is included in the renovation with ENERGY STAR or 
FEMP designated products, per 10 CFR part 436, subpart C. For component 
level retrofits, agencies will replace all equipment that is part of 
the renovation with ENERGY STAR or FEMP designated products as defined 
at 10 CFR part 436, subpart C.
    In setting efficiency requirements, both FEMP and ENERGY STAR 
choose levels that are among the highest 25 percent of efficiency for a 
given product category. ENERGY STAR estimates that its program saves 
more than 200 billion kWh of electricity each year, and FEMP estimates 
that compliance with its efficiency requirements can save the 
government more than 30 trillion BTUs each year. Both programs have 
integrated life-cycle cost effectiveness into their guiding principles 
and, as such, Federal buyers can have confidence that required products 
have both good energy performance and a total cost of ownership that is 
equal to or less than products below set efficiencies. Prescriptive 
requirements of ASHRAE 90.1 and IECC demonstrate similarly high levels 
of efficiency. Together, these requirements cover more than 70 product 
types and will help ensure that the products used within Federal 
facilities are among the highest energy efficiencies available. Federal 
buildings that install and use these products will realize lower energy 
intensities compared to using non-compliant products.
6. Make Information Publicly Available
    DOE received some comments on the NOPR that petitions for downward 
adjustment should be made publicly available on a DOE website. 
Commenters stated that making this information publicly available would 
make the process transparent, hold agencies accountable, and could 
reduce unsupported petitions. As a result of these comments on the 
NOPR, DOE proposed in the 2014 SNOPR to report petition summary level 
information in

[[Page 78396]]

the DOE Annual Report to Congress on Federal Energy Management and 
Conservation Programs (See www.energy.gov/about/budget.htm).
    DOE received two comments on its proposal. Earthjustice commented 
that to ensure public accountability, all petitions and DOE responses 
should be made publicly available. (Earthjustice No. 9 at p.7) An 
individual commenter commented that transparency is an important factor 
that will influence the effectiveness of this regulation and create 
accountability for meeting the target requirements and deadlines. 
(Dirogene No. 3 at p.1) DOE agrees that transparency is important and 
will publish any petitions that are filed, deemed complete, and 
screened for national security reasons for downward adjustment that are 
received (subject to potential filtering for national security reasons) 
on the DOE website.
7. Narrow the Use of Petitions
    DOE received a few comments on the NOPR related to narrowing the 
use of petitions for downward adjustment. In response to these 
comments, DOE proposed changes in the 2014 SNOPR that would reduce the 
number of petitions submitted for downward adjustment and improve the 
content of submitted petitions. DOE expanded the number of building 
types covered in Tables A-1a and A-1b to A-2a and A-2b in appendix A of 
part 433 and added a methodology for calculating the maximum allowable 
fossil fuel-generated consumption values for buildings with process 
loads. This was expected to greatly reduce the number of building types 
without baselines and fossil fuel reduction targets, eliminating a 
significant potential source of petitions. In addition, in response to 
some of the public comments received, the 2014 SNOPR proposed that 
additional information be provided as part of the petition process, 
including that Federal agencies must: (1) demonstrate that the 
requested adjustment represents the largest feasible fossil fuel 
reduction that can be achieved, given agency mission and building 
purpose; and (2) describe all technologies and practices that were 
evaluated and rejected, including a justification as to why they were 
not included in the design. The rule requires Federal agencies to 
provide specific information about the energy efficiency and on-site 
renewable energy measures included in the proposed building design to 
enable DOE to evaluate the request for downward adjustment.
    DOE received no comments on this topic in the 2014 SNOPR, so DOE 
proposes to require evidence of these additional criteria in petitions 
for downward adjustments.
8. GSA Tenant Agencies
    ECPA, as amended, does not provide GSA the option of petitioning 
DOE for a downward adjustment of the applicable percentage reduction 
requirement. (42 U.S.C. 6834(a)(3)(D)(i)(II)) In the NOPR, DOE proposed 
that a new Federal building or a Federal building undergoing major 
renovations for which a GSA tenant that is a Federal agency is 
providing substantive and significant design criteria may be the 
subject of a petition. 75 FR 63412. Under this approach, DOE proposed 
that a GSA building that is designed to meet the specifications 
provided by a tenant agency may be considered for a downward adjustment 
if a petition is submitted by the head of the tenant agency.
    In response to the NOPR, DOE received one comment on this issue 
stating that allowing GSA tenant agencies to petition for downward 
adjustments contradicts the statute. DOE noted in the 2014 SNOPR that 
while the statute prohibits GSA from petitioning DOE for a downward 
adjustment, it makes no reference to GSA tenant agencies. DOE will 
allow GSA tenant agencies that have significant control over building 
design to submit a petition. In such cases, it will be the tenant 
agency, not GSA, that is making the design choices that will allow for 
compliance with the rule. Allowing GSA tenant agencies to submit a 
petition for downward adjustment will provide an option for some 
buildings for which the required fossil fuel reductions may be 
technically impracticable in light of the building's functional needs, 
but for which GSA may not submit a petition.
    DOE received one comment on this topic in response to the 2014 
SNOPR. Earthjustice commented that DOE may not allow tenants of GSA 
buildings to petition for downward adjustments of the fossil fuel 
reductions because the statute specifically excludes only GSA from the 
downward adjustment petition process, expanding the number of buildings 
eligible for such adjustments in a manner that directly contravenes the 
plain statutory language and that is arbitrary and capricious. 
(Earthjustice No. 8 at p.6) DOE reiterates that while the statute 
prohibits GSA from petitioning DOE for a downward adjustment, it makes 
no reference to GSA tenant agencies. The statute allows for an 
``agency'' to petition for a downward adjustment. The term ``Federal 
agency'' means any department, agency, corporation, or other entity or 
instrumentality of the executive branch of the Federal Government, 
including the United States Postal Service, the Federal National 
Mortgage Association, and the Federal Home Loan Mortgage Corporation. 
42 U.S.C. 6832(5). As the commenter notes, the statute only prohibits 
GSA from submitting a petition. Thus, in cases in which the tenant 
agency exercises significant control of design choices in the building, 
and GSA does not, it makes little sense to prohibit the tenant agency 
form petitioning for an adjustment where the statute does not expressly 
require it. Moreover, these petitions are still subject to the same 
criteria and review process as other petitions and would need to 
justify any downward adjustment in accordance with such. Accordingly, 
in this SNOPR, DOE has decided to continue to allow GSA tenant agencies 
to petition in those cases where GSA tenants have design control.
9. Other Relevant Comments
    In this category, DOE received two comments on the 2014 SNOPR. 
Earthjustice commented that it is unnecessary to limit the scope of 
major renovations covered by the rule to the extent that the renovation 
permits compliance with applicable requirements. Earthjustice argues 
that as the rule does not apply to unaltered portions of buildings or 
buildings systems that are undergoing major renovations it is not 
necessary to further limit the scope. Moreover, because ``the scope of 
the renovation'' is not a defined term, it may be subject to a broad 
interpretation by agencies subject to the fossil fuel reduction 
requirement. (Earthjustice No. 5 at p.4)
    In response, DOE also notes that this rule is not the only 
requirement that mandates that Agencies implement and upgrade their 
facilities. Per 42 U.S.C. 8253(f), agencies are required to complete 
their annual comprehensive energy and water evaluation for 
approximately 25 percent of their covered facilities each calendar year 
and through those evaluations agencies will identify and plan for 
significant updates and modifications to those covered facilities. This 
proposed rule is not the appropriate vehicle for requiring significant 
facility upgrades beyond the portions being replaced.
    ODUSD(I&E) also commented that requiring individual renovation 
projects that have difficulty in meeting the requirements, (regardless 
of size, renovation type, scope, funding, climatic conditions, etc.) to 
petition

[[Page 78397]]

DOE for downward adjustment may pose significant challenges. 
(ODUSD(I&E) No. 1 at p.1) DOE recognizes that petition submittals may 
add burden for agencies undertaking major renovations in buildings. 
However, EISA provides no recourse to agencies other than petitioning 
DOE for major renovations subject to the scope of these standards. As 
noted previously, pursuant to the intent indicated by EISA, DOE 
construes the term ``major renovations'' broadly to include projects 
for which agencies can practicably implement the energy efficiency and 
fossil fuel reduction goals of ECPA and EISA, including component and 
system level renovations subject to the $2.5 million threshold. 
Accordingly, agencies will need to submit a petition to adjust the 
relevant reduction targets for such projects. DOE notes that, in this 
SNOPR, DOE is proposing to make best efforts to complete review of 
petitions within 45 calendar days of receipt for new construction and 
major building retrofits and 20 calendar days for component level 
retrofits for adjustment consideration. DOE believes this will help 
obviate any burden experienced by agencies that submit petitions.

E. Impacts of the Rule

    As part of the 2014 SNOPR, DOE requested comments on the impacts of 
the proposed rule. DOE received comments in two categories--Cost 
Impacts and Other Impacts.
1. Cost Impacts
    In response to the 2014 SNOPR, DOE received eight comments on cost 
impacts. Several comments recommended referring to the Office of 
Management and Budget (``OMB'') Circular A-94 to the rule. In response, 
DOE notes that while OMB Circular A-94 is an important document, 
section 544 of the National Energy Conservation Policy Act (``NECPA''), 
as amended by section 441 of EISA 2007, directed DOE to establish 
practical and effective present value methods for estimating and 
comparing life-cycle costs for Federal buildings, based on capital and 
operating costs during a period of the expected life of the building's 
energy system or 40 years, whichever is shorter. See 42 U.S.C. 8254. 
Further, Federal agencies must use the DOE-established methods in the 
design of new Federal buildings and the application of energy 
conservation measures to existing Federal buildings. Id. at (b)(1). DOE 
established life-cycle cost analyses methodologies and procedures in 10 
CFR part 436, subpart A. Federal agencies are already using the 
methodologies and procedures in 10 CFR part 436, subpart A when meeting 
the energy efficiency obligations in 10 CFR parts 433 and 435. To 
ensure consistency across Federal buildings regulations, DOE will 
continue to use the same methodologies and procedures.
    Other comments suggested that the life-cycle costs of implementing 
new requirements under the fossil energy reduction rule are 
underestimated and that costs for compliance should be more closely 
examined. In response to these comments, DOE based its costs on the 
best available estimates it had at the time.
    Several comments stated that while the 2014 SNOPR explicitly did 
not consider costs, because of the obligations imposed by the statute, 
exorbitant additional expenditures remain unjustified. Further comments 
implied that because of the inherent efficiency of natural gas used 
directly on site, the overall impact of displacing natural gas use with 
electrically powered alternatives will be an increase in total GHG 
emissions, a decrease in energy productivity of Federal buildings, and 
increased energy costs to Federal agencies and ultimately to taxpayers. 
In response, DOE notes that had Congress intended for DOE to consider 
costs in establishing the fossil fuel use reduction targets in this 
rule or in adjudicating petitions it would have specified to do so. 
Instead, Congress directed DOE to use the specific reduction targets 
contained in 42 U.S.C. 6834(a)(3)(d)(i)(I), and base DOE's petition 
adjudication decisions on agency determinations of technical 
impracticability.
    However, while DOE did not consider costs in setting the reduction 
targets or petition requirements, as part of its obligations under 
Executive Order 12866 to inform the public of the impacts of the 
proposed rule, DOE analyzed the costs and benefits of the rule proposed 
in the 2014 SNOPR and in this proposed rule, and has tentatively 
concluded that the rule as a whole saves both site energy and life-
cycle cost.
    Other commenters also requested that DOE present its construction 
cost increases as a percentage of total cost on both a year and 
cumulative basis and provide more detail about DOE's assumptions 
underlying the analysis. The commenters further requested that DOE also 
explain why its year 2020 costs and beyond are relatively constant, 
stating that they believe that compliance costs will grow much more 
significantly as permitted fossil fuel energy consumption nears zero. 
All assumptions used in the RIA are documented in the RIA document. The 
costs for year 2020 and beyond are relatively constant because DOE 
assumed that by 2020, agencies would be able to achieve the maximum 
estimated savings for major renovations by that time.
    Another comment was made that a problem with the cost estimate is 
that the RIA makes no reference to life cycle costs, even though 
section 109 of Energy Policy Act of 2005 (``EPAct 2005'') requires 
technologies employed be life[hyphen]cycle cost[hyphen] effective. 
(ODUSD(I&E) No. 4 at p.1) DOE notes that section 109 of EPAct 2005 
amended section 305 of ECPA, which was later amended by section 433 of 
EISA, which provides the authority for this rulemaking. The amendments 
made by section 433 of EISA did not include requirements or references 
to life-cycle cost-effectiveness with respect to the fossil fuel-
generated energy consumption reduction targets of EISA section 433. If 
Congress intended for life-cycle cost-effectiveness to be considered as 
part of these reduction targets, it would have specifically stated so 
in section 433 of EISA as it did in the amendments in section 109 of 
EPAct 2005. Moreover, DOE does not see a conflict between this rule and 
the Federal building energy efficiency rules in 10 CFR parts 433 and 
435 in terms of life-cycle cost-effectiveness.
2. Other Impacts
    DOE also received eighteen comments on other impacts of the rule. 
One comment stated this rule is an action that would have a significant 
adverse effect on energy, and therefore DOE must prepare a Statement of 
Energy Effects pursuant to E.O. 13211. See 79 FR 61722. In response, 
DOE states that this rule is not a significant energy action requiring 
a Statement of Energy Effects pursuant to E.O. 13211, because it is not 
expected to have a significant adverse effect on the supply, 
distribution, or use of energy. According to the Office of Management 
and Budget, ``adverse effects'' requiring a statement under E.O. 13211 
include significant (1) reductions in the production or supply of crude 
oil, coal, natural gas, or other fuel; (2) increases in energy use; or 
(3) increases in the cost of energy production or distribution. The 
current action implements a statutory mandate to reduce fossil fuel 
energy use in Federal buildings. As such, this action cannot reasonably 
be expected to reduce the production or supply of fuel, increase energy 
use, or significantly increase the cost of energy production.
    Several other comments suggested that the proposed mandate is not 
only

[[Page 78398]]

costly and impractical, but also infeasible, not flexible enough, or 
absolutely unattainable. In response, DOE notes that DOE's rule is 
based directly on Congressionally mandated language in section 433 of 
EISA 2007, which governs fossil fuel-generated energy consumption. Per 
the statute, however, the rule does allow for the downward adjustments 
of the required reductions in some cases.
    Other comments supported the rule, by pointing out that this rule 
presents DOE with a significant opportunity not only to reduce the 
Federal Government's own energy costs and environmental footprint, but 
also to influence the design of both state and local government 
buildings as well as all new residential and commercial buildings. 
Therefore, this proposed rulemaking is an opportunity for the Federal 
Government to use its large purchasing power to drive and transform 
markets for greater efficiency and reduced fossil fuel consumption in 
all buildings. Two additional supportive comments commended DOE for 
working with stakeholders to craft the 2014 SNOPR and pointed out that 
the rule will increase the ability to design and build facilities that 
use less energy, save energy, save taxpayers money, and protect the 
environment; and also that stakeholders from varying industries have 
been working with the Department of Energy to implement this rule in a 
way that is smart, efficient, and effective, noting that some have 
argued that these targets are not achievable, but building and 
sustainability professionals are already succeeding in making Federal 
facilities meet sustainability targets, including DOE's new Research 
Support Facilities (``RSF'') in Colorado, which opened in 2010. More 
importantly, private sector owners are increasingly adopting these 
technologies and strategies for their buildings.
    DOE also received six comments on the use of the social cost of 
carbon (``SCC''). DOE is presenting monetized benefits in accordance 
with the applicable Executive Orders and DOE would reach the same 
tentative conclusion presented in this SNOPR in the absence of the 
social cost of greenhouse gases, including the February 2021 Interim 
Estimates presented by the Interagency Working Group on the Social Cost 
of Greenhouse Gases.

F. Guidance and Other Topics

    DOE requested specific comment in the 2010 NOPR and 2014 SNOPR on 
what additional training and guidance would help agencies meet the 
reductions called for by this statute. DOE received a single comment on 
this topic in the 2014 SNOPR. That comment focused on the fact that DOE 
had not included implementation of sub-metering as a requirement for 
new Federal buildings and major renovations for Federal buildings 
because the compulsory implementation of sub-metering should alleviate 
future stresses related to clarification of major renovations, improve 
accuracy of process load baselines for future Federal building 
construction, and aid in verification of building simulation models 
developed during the design stage (especially since they are enforced 
under this rule for current and future projects). The commenter further 
stated that dissemination of sub-metering in Federal buildings is 
instrumental in achieving an intelligent grid capable of improving 
delivered power quality and inducing energy efficient behavior from 
building owners and operators. In response, DOE notes that agencies are 
already subject to certain metering and advanced metering requirements. 
42 U.S.C. 8253(e). DOE has issued metering guidance for Federal 
agencies in accordance with the Energy Policy Act of 2005, EISA 2007, 
and the Presidential Memorandum ``Federal Leadership on Energy 
Management''. See www.energy.gov/eere/femp/articles/doe-releases-Federal-building-metering-guidance for more details. DOE notes this 
guidance addresses metering, and not sub-metering, in accordance with 
Congressional and Presidential direction. Neither sub-metering nor 
metering is expressly mentioned in section 433 of EISA 2007. Therefore, 
those topics are not addressed in this SNOPR.

IV. Methodology, Analytical Results, and Conclusion

    DOE acknowledges exchanging on-site fossil fuel generated energy 
for reliance on the electric grid, which may still be generating energy 
with fossil fuels, doesn't necessarily lead to an immediate reduction 
in emissions of GHGs and SO2 and in some cases (and as a 
whole) may result in increased energy costs. However, this proposed 
rule is intended to prepare federal buildings for a green energy 
future. By ensuring that federal buildings are designed--either from 
the ground up, or when being renovated--to rely on the electric grid, 
the rule ensures that long-term, as the grid integrates more carbon 
free energies, emissions will be reduced. In addition, DOE expects 
emerging and improving technological advancements in electric equipment 
such as heat pumps will lead to additional and dramatic site energy 
savings further improving the emissions and cost savings cases for this 
rule.

A. Cost-Effectiveness

    DOE's assumptions and methodology for the cost-effectiveness of 
this rule are built upon the cost-effectiveness analysis of ASHRAE 
Standard 90.1-2019 conducted by DOE's State building energy codes 
program,\12\ as well as DOE's Environmental Assessment (EA) for this 
proposed rulemaking.\13\ As described in the EA, DOE identified a rate 
of new Federal commercial construction of 13.3 million square feet per 
year with a distribution of building types as shown in Table IV.1. 
Starting in the year 2030, section 205(c)(ii) of Executive Order 14057, 
``Catalyzing Clean Energy Industries and Jobs Through Federal 
Sustainability.'' (December 8, 2021) requires to ``design new 
construction and modernization projects greater than 25,000 gross 
square feet to be net-zero emissions by 2030''. This effectively 
reduces the impact of this rule to apply to new construction and major 
renovation projects that fall above the cost threshold but are also 
below 25,000 gross square feet. For the year 2030 and beyond the 
estimated new Federal commercial and multi-family high-rise residential 
building construction volume per year will be 2.2 million square feet 
per year with a distribution of building types as shown in Table IV.2. 
The distribution of building types is based on an extraction of the 
latest 10 years of new construction data entered into the Federal Real 
Property Portfolio Management System (``FRPP MS'') that meets the 
required cost threshold of the proposed rule for cases both before and 
after the 25,000 Sf minimum triggering E.O. 14057 compliance.\14\ 
Additionally DOE identified an estimated rate of federal major 
renovation projects that would be influenced by this rule. To do so DOE 
utilized data from the Federal Compliance Tracking System (``CTS'') 
where agencies report data on building efficiency improvement projects. 
The

[[Page 78399]]

data from CTS was queried to include only those projects which would 
meet the cost threshold and have impacts on site fossil fuel energy 
consumption. As not all agencies are compliant in reporting data into 
CTS, results were scaled up to account for agencies out of compliance. 
CTS does not supply data on the types of buildings for the reported 
projects, as such the distribution of eligible federal buildings for a 
renovation that would meet the cost threshold was applied to the 
estimated project square footage. DOE identified a rate of new Federal 
major renovation construction of 1.36 million square feet per year with 
a distribution of building types as shown in Table IV.1. Starting in 
the year 2030, section 205(c)(ii) of Executive Order 14057 ``Catalyzing 
Clean Energy Industries and Jobs Through Federal Sustainability.'' 
(December 8, 2021) requires agencies to ``design new construction and 
modernization projects greater than 25,000 gross square feet to be net-
zero emissions by 2030''. This part of the Executive Order effectively 
reduces the impact of this rule to apply only to new construction and 
major renovation projects that fall above the cost threshold but are 
also below 25,000 gross square feet. Taking this into account for the 
year 2030 and beyond, the estimated new Federal commercial and multi-
family high-rise residential building major renovation construction 
volume per year will be 0.4 million square feet per year with a 
distribution of building types as shown in Table IV.1 and Table IV.2 of 
this document. These tables also show the prototype buildings 
incorporated into computer simulations that are used to estimate energy 
use in each building type. DOE derived these prototype buildings from 
16 building types in 17 climate zones \15\ using its Commercial 
Prototype Building models.\16\ Of the 16 prototype buildings, DOE 
developed costs for 6 prototype buildings to determine the cost 
effectiveness of ASHRAE Standard 90.1-2016 and ASHRAE Standard 90.1-
2019. DOE then extracted the cost-effectiveness information for those 
prototype buildings and weighted those values as appropriate to obtain 
an average cost effectiveness value for building types found in the 
Federal commercial sector.
---------------------------------------------------------------------------

    \12\ See DOE's analysis of the cost savings of the 2016 and 2019 
ASHRAE 90.1 Standards at www.energycodes.gov/sites/default/files/2020-07/90.1-2016_National_Cost-Effectiveness.pdf and 
www.energycodes.gov/sites/default/files/2021-07/90.1-2019_National_Cost-Effectiveness.pdf, respectively.
    \13\ The Environmental Assessment (EA) (DOE/EA-2165) is 
entitled, ``Environmental Assessment for Final Rule, 10 CFR part 
433, `Energy Efficiency Standards for New Federal Commercial and 
Multi-Family High-Rise Residential Buildings' Baseline Standards 
Update''. The EA may be found in the docket for this proposed 
rulemaking and at www.energy.gov/node/472482.
    \14\ See www.realpropertyprofile.gov/FRPPMS/FRPP_Login.
    \15\ Briggs, R.S., R.G. Lucas, and Z.T. Taylor. 2003. ``Climate 
classification for building energy codes and standards: Part 1--
Development Process.'' ASHRAE Transactions 109(1): 109:121. American 
Society of Heating, Refrigerating and Air-Conditioning Engineers. 
Atlanta, Georgia.
    \16\ DOE's prototype buildings are described at 
www.energycodes.gov/prototype-building-models.

Table IV.1--New Federal Commercial and High-Rise Multi-Family Construction Volume by Building Type for Buildings
                                         Constructed in Years 2025-2029
----------------------------------------------------------------------------------------------------------------
                                            Fraction  of
                                              Federal
             Building type                  construction     Assumed BECP prototypes    Assumed BECP prototypes
                                         volume  (by floor      for energy savings       for cost effectiveness
                                             area)  (%)
----------------------------------------------------------------------------------------------------------------
Office.................................              17.77  Small Office, Medium       Small Office, Large
                                                             Office, Large Office.      Office.
Dormitories and Barracks...............              14.57  Small Hotel, Mid-rise      Small Hotel, Mid-rise
                                                             Apartment, High-rise       Apartment.
                                                             Apartment.
School.................................              15.65  Secondary School.........  Primary School.
Service................................              15.16  Stand-alone Retail, Non-   Stand-alone Retail.
                                                             refrigerated Warehouse.
Other Institutional Uses...............               5.76  None *...................  None.
Hospital...............................               7.80  Hospital.................  Small Office, Large
                                                                                        Office.
Warehouses.............................               2.95  Non-Refrigerated           None.
                                                             Warehouse.
Laboratories...........................               4.24  Medium Office, Hospital..  Small Office, Large
                                                                                        Office.
All Other..............................               2.74  None.....................  None.
Outpatient Healthcare Facility.........               5.00  Outpatient Healthcare....  Small Office.
Industrial.............................               1.63  None.....................  None.
Child Care Center......................               0.89  Primary School...........  Primary School.
Communications Systems.................               1.42  None.....................  None.
Prisons and Detention Centers..........               0.18  None.....................  None.
Family Housing.........................               1.06  Mid-rise Apartment.......  Mid-rise Apartment.
Navigation and Traffic Aids............               0.53  None.....................  None.
Land Port of Entry.....................               0.68  Non-refrigerated           None.
                                                             Warehouse.
Border/Inspection Station..............               0.64  Small Office, Non-         Small Office.
                                                             refrigerated Warehouse.
Facility Security......................               0.25  Small Office.............  Small Office.
Data Centers...........................               0.34  None.....................  None.
Museum.................................               0.74  None.....................  None.
Comfort Station/Restrooms..............               0.01  Non-refrigerated           None.
                                                             Warehouse.
Public Facing Facility.................               0.02  Stand-alone Retail.......  Stand-alone Retail.
Aviation Security Related..............               0.00  Small Office.............  Small Office.
Post Office............................               0.00  Stand-alone Retail.......  Stand-alone Retail.
----------------------------------------------------------------------------------------------------------------
* Note that energy savings and cost-effectiveness mapping are not available for a number of Federal building
  types, with other institutional uses, warehouses, and all other being the largest Federal building types with
  no reliable mapping. As described in this section, DOE considered energy savings and costs for these unmapped
  Federal building types to be equivalent to the weighted energy savings and cost for the mapped Federal
  building types.


[[Page 78400]]


Table IV.2--New Federal Commercial and High-Rise Multi-Family Construction Volume by Building Type for Buildings
                                         Constructed in Years 2030-2054
----------------------------------------------------------------------------------------------------------------
                                            Fraction  of
                                              Federal
             Building type                  construction     Assumed BECP prototypes    Assumed BECP prototypes
                                         volume  (by floor      for energy savings       for cost effectiveness
                                             area)  (%)
----------------------------------------------------------------------------------------------------------------
Office.................................              14.24  Small Office, Medium       Small Office, Large
                                                             Office.                    Office.
Dormitories and Barracks...............               4.02  Small Hotel, Mid-rise      Small Hotel, Mid-rise
                                                             Apartment, High-rise       Apartment.
                                                             Apartment.
School.................................              10.88  Secondary School.........  Primary School.
Service................................              18.34  Stand-alone Retail, Non-   Stand-alone Retail.
                                                             refrigerated Warehouse.
Other Institutional Uses...............              12.63  None *...................  None.
Hospital...............................               2.97  Hospital.................  Small Office, Large
                                                                                        Office.
Warehouses.............................               6.88  Non-Refrigerated           None.
                                                             Warehouse.
Laboratories...........................               4.37  Medium Office, Hospital..  Small Office, Large
                                                                                        Office.
All Other..............................               5.58  None.....................  None.
Outpatient Healthcare Facility.........               7.66  Outpatient Healthcare....  Small Office.
Industrial.............................               2.05  None.....................  None.
Child Care Center......................               2.67  Primary School...........  Primary School.
Communications Systems.................               0.87  None.....................  None.
Prisons and Detention Centers..........               0.26  None.....................  None.
Family Housing.........................               1.49  Mid-rise Apartment.......  Mid-rise Apartment.
Navigation and Traffic Aids............               1.95  None.....................  None.
Land Port of Entry.....................               0.99  Non-refrigerated           None.
                                                             Warehouse.
Border/Inspection Station..............               0.36  Small Office, Non-         Small Office.
                                                             refrigerated Warehouse.
Facility Security......................               1.36  Small Office.............  Small Office.
Data Centers...........................               0.19  None.....................  None.
Museum.................................               0.10  None.....................  None.
Comfort Station/Restrooms..............               0.03  Non-refrigerated           None.
                                                             Warehouse.
Public Facing Facility.................               0.09  Stand-alone Retail.......  Stand-alone Retail.
Aviation Security Related..............               0.00  Small Office.............  Small Office.
Post Office............................               0.00  Stand-alone Retail.......  Stand-alone Retail.
----------------------------------------------------------------------------------------------------------------
* Note that energy savings and cost-effectiveness mapping are not available for a number of Federal building
  types, with other institutional uses, warehouses, and all other being the largest Federal building types with
  no reliable mapping. As described in this section, DOE considered energy savings and costs for these unmapped
  Federal building types to be equivalent to the weighted energy savings and cost for the mapped Federal
  building types.

    DOE has determined incremental construction first cost information 
for the building types and climate zones analyzed for buildings 
compliant with this proposed rule (``Clean Energy Rule Compliant'' 
buildings) versus ASHRAE Standard 90.1-2019 (see Table IV.3).\17\
---------------------------------------------------------------------------

    \17\ Note that the values in Table IV.3 have been adjusted to 
reflect 2021$ from the table that appears in DOE's determination of 
energy savings for Standard 90.1-2016, which were in 2018$. This 
adjustment was made using the GDP deflator value to correct for 
inflation between 2018 and 2021. Organization for Economic Co-
operation and Development, GDP Implicit Price Deflator in United 
States, retrieved from FRED, Federal Reserve Bank of St. Louis; 
fred.stlouisfed.org/series/USAGDPDEFAISMEI, Updated February 17, 
2021. These values have also been adjusted to reflect the same 
underlying economic assumptions as the 2019 version, and sales tax 
has also been removed.

 Table IV.3--Incremental Construction First Cost (2021$) for ASHRAE Standard 90.1-2019 vs. Fossil Fuel Compliant
                                                 Building Design
----------------------------------------------------------------------------------------------------------------
                                                                      ASHRAE climate zone *
          Prototype                  Value      ----------------------------------------------------------------
                                                      2A           3A           3B           4A           5A
----------------------------------------------------------------------------------------------------------------
Small Office.................  First Cost......         $673         $584         $515       $1,666         $641
                               $/ft\2\.........         0.12         0.11         0.09         0.30         0.12
Large Office.................  First Cost......      261,781      268,194      196,408      354,808      223,553
                               $/ft\2\.........         0.52         0.54         0.39         0.71         0.45
Stand-alone Retail...........  First Cost......       19,608       20,240       19,740       21,563       19,363
                               $/ft\2\.........         0.79         0.82         0.80         0.87         0.78
Primary School...............  First Cost......    (126,946)    (121,994)    (116,139)     (94,722)    (122,894)
                               $/ft\2\.........       (1.72)       (1.65)       (1.57)       (1.28)       (1.66)
Small Hotel..................  First Cost......    (104,866)    (104,624)    (104,396)    (101,194)    (103,044)
                               $/ft\2\.........       (2.43)       (2.42)       (2.42)       (2.34)       (2.38)
Mid-rise Apartment...........  First Cost......     (18,343)     (17,490)     (18,113)     (12,445)     (25,126)
                               $/ft\2\.........       (0.54)       (0.52)       (0.54)       (0.37)       (0.74)
----------------------------------------------------------------------------------------------------------------
* Negative costs (shown in parentheses) indicate a reduction in cost due to changes in the code, usually due to
  reduced HVAC capital cost and reduction of venting required for onsite combustion.


[[Page 78401]]

    DOE used data from Table IV.3 to calculate preliminary values for 
overall incremental first cost of construction for Federal commercial 
and high-rise, multi-family residential buildings. DOE calculated the 
incremental first cost of the Federal building types based on the DOE 
cost prototypes shown in the far-right column of Table IV.1 of this 
document. DOE then calculated the weighted average incremental cost for 
mapped Federal building types based on their corresponding BECP 
prototypes, which represent an estimated 79.3 percent of new Federal 
construction. This weighted incremental cost was assigned to un-mapped 
Federal building types, and a total weighted incremental cost was 
calculated by multiplying the incremental cost for each Federal 
building type by the fraction of Federal construction shown in Table 
IV.1.
    The national incremental first cost for building types was 
developed by multiplying the average (across climate zones) incremental 
first cost of the prototypes (determined from the DOE State building 
energy codes program ASHRAE Standard 90.1 cost-effectiveness analysis) 
by the fraction of the Federal sector construction volume shown in 
Table IV.1, and then multiplying that by the total estimate of Federal 
new construction floorspace.\18\ DOE estimates that total first cost 
outlays for new Federal buildings will be less under Clean Energy Rule 
compliant designs than ASHRAE Standard 90.1-2019, primarily due to 
lower HVAC equipment costs for some building types (See Table IV.3). 
The resulting total incremental first cost estimate is a savings of 
$8.62 million per year. The average first cost decrease is $1.86 per 
square foot. These first cost decreases are a result of the lower 
capital costs of the assumed electric equipment types as dictated in 
the ASHRAE and IECC energy codes (as mandated in 10 CFR part 433 and 10 
CFR part 435 and are the baseline for this modified building efficiency 
standard). Minimally compliant electric equipment was assumed in the 
proposed case as hitting the 30% better than baseline performance goal 
as generally required by regulation and does include a cost 
effectiveness caveat that can reduce the goal down to minimal 
compliance. As can be seen in Table IV.4, most building types switch 
their space heating systems from a fossil fuel burning system over to 
an electric resistance-based system. DOE seeks comment on the 
efficiency of the electric equipment used in its analyses.
---------------------------------------------------------------------------

    \18\ For the Federal office building, the small and large office 
prototype first costs were averaged. For the Federal education 
building, the primary school prototype first cost was used. For the 
Federal dormitories/barracks building type, the small hotel and mid-
rise apartment prototype first costs were averaged.

                                          Table IV.4--Breakdown of Proposed Heating System by Building Protype
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                             Yearly          Yearly
                                           constructed     constructed    Baseline gas     Proposed electric unit
           Building prototype             SF--Post 2030   SF--Pre 2030        unit               efficiency                    Space heat notes
                                               (%)             (%)         efficiency
--------------------------------------------------------------------------------------------------------------------------------------------------------
Small Office...........................            12.8            14.8            0.81  99% Electric Boilers......  Convert using AFUE for gas furnace
                                                                                                                      and AFUE Estimate for Electric
                                                                                                                      Furnace.
Medium Office..........................             2.6             5.5            0.79  99% Electric Furnaces.....  Convert using pre 1/1/2023 Et
                                                                                                                      estimated Et for Furnaces assuming
                                                                                                                      0.75% casing loss.
Large Office...........................             0.0             2.3            0.82  99% Electric Boilers......  Convert using Et Estimate for
                                                                                                                      boilers.
Stand-Alone Retail.....................            13.2             8.8            0.79  1.76 COP RTU Heat Pump....  Convert using national weight heat
                                                                                                                      pump efficiency from office
                                                                                                                      analysis.
Primary School.........................             3.8             1.0            0.81  99% \1/4\ Furnaces, \3/4\   \1/4\ Furnaces, \3/4\ boilers.
                                                                                          boilers.                    Convert both to electric
                                                                                                                      equivalents.
Secondary School.......................            15.5            18.1            0.82  99% Electric Boilers......  Convert using Et Estimate for
                                                                                                                      boilers.
Outpatient Health Care.................            10.9             5.8            0.82  99% Electric Boilers......  Convert using Et Estimate for
                                                                                                                      boilers.
Hospital...............................             8.9            12.7            0.82  99% Electric Boilers......  Convert using Et Estimate for
                                                                                                                      boilers.
Small Hotel............................             0.4             1.2            0.81  99% Electric Furnaces.....  Convert using AFUE for Gas and AFUE
                                                                                                                      Estimate for Electric.
Warehouse..............................            24.4            13.1            0.79  99% Electric Furnaces.....  Note Model uses a 0.8 gas AFUE for
                                                                                                                      office space, but 0.7925 for Fine
                                                                                                                      storage and unit heater.
Mid-Rise Apartment.....................             4.7             8.7            0.81  2.4 COP Residential Heat    Convert using AFUE Estimate to
                                                                                          Pump.                       residential HSPF.
High-Rise Apartment....................             2.7             8.2            0.82  99% Electric Boilers......  Convert using Et Estimate for
                                                                                                                      boilers.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    An estimated 17.7 percent of the projects would utilize heat pumps 
in their proposed ``all electric'' case (those that map to Stand Alone 
Retail and Mid-Rise Apartment prototype models) with assumed efficiency 
performance metrics as noted. Service hot water systems (when not 
already specified as an electric system per 10 CFR parts 433 and 435 
requirement) are similarly assumed to be minimally compliant electric 
resistance systems with 99 percent efficiencies. Cooking systems where 
present are assumed to switch from 40 percent efficient gas systems to 
70 percent standard efficiency electric systems.
    It should be noted that in all cases higher efficiency electric 
equipment is available on the market, but the statutory authority of 
this rule is limited to total building reduction targets and does not 
specify specific equipment types or efficiency levels. An agency is 
free to design a project per their own site, cost, and usage specific 
needs, while complying with the applicable efficiency targets. As such, 
the analysis presented in this SNOPR intends to capture the base-level 
compliance cases only. An agency is free and encouraged to select 
higher efficiency equipment (such as even higher efficiency heat pumps 
and/or more widespread adoption) as project details accommodate. DOE 
encourages the higher efficiency equipment to be carefully considered 
by agencies as it can often provide projects with a lifecycle cost 
effective solution that saves even more energy and emissions (albeit 
usually with higher up-front capital costs) than presented for base 
compliance with this rule.
    DOE is seeking comment with regard to heat pump pricing, 
availability, efficiency levels, and weather incentivizing higher 
performing equipment is likely to increase utilization amongst federal 
facilities.
    DOE also analyzed the relative impact of the final rule on the 
first cost of new constructed Federal buildings as a

[[Page 78402]]

percentage of the overall annual cost of newly constructed Federal 
commercial and high-rise buildings. In order to estimate the total cost 
of construction for new Federal buildings, DOE obtained estimated 
construction costs for new Federal commercial and high-rise multifamily 
buildings were obtained from RS Means (2020) \19\ for the six building 
types analyzed in DOE's cost-effectiveness report. These new 
construction costs were weighted by the percent of Federal floorspace 
to develop an average cost of a new Federal building of $198 per square 
foot, as shown in Table IV.5. This average construction cost may be 
multiplied by the overall total of 19.54 million square feet of new 
Federal construction per year used in this rulemaking to estimate the 
annual total cost of all new Federal commercial and high-rise multi-
family construction of $3.86 billion. As previously noted, first cost 
savings associated with this rulemaking are estimated at $8.62 million 
per year, indicating a potential cost reduction in new Federal 
construction costs of 0.223 percent ($8.62 million divided by $3.86 
billion).
---------------------------------------------------------------------------

    \19\ RS Means. 2020. RS Means Building Construction Cost Data, 
78th Ed. Construction Publishers & Consultants. Norwell, MA.

                        Table IV.5--First Cost of Typical New Federal Building in $/ft\2\
----------------------------------------------------------------------------------------------------------------
                                                                                                       Weighted
                       Federal building type                           Weight  (%)    First cost *       cost
----------------------------------------------------------------------------------------------------------------
Office.............................................................           20.74            $210       $43.51
Barracks and Dormitories...........................................           14.85             217        32.18
School.............................................................           14.33             225        32.25
Service............................................................           13.31             116        15.44
Hospital...........................................................            5.57             200        11.14
Laboratories.......................................................            4.37             200         8.73
Outpatient Healthcare Facility.....................................            3.35             220         7.38
Child Care Center..................................................            1.18             225         2.67
Family Housing >3 Stories..........................................            0.68             218         1.48
Border/Inspection Station..........................................            0.49             220         1.07
Facility Security..................................................            0.31             220         0.69
Aviation Security Related..........................................            0.01             220         0.02
Public Facing Facility.............................................            0.05             116         0.06
Post Office........................................................            0.01             116         0.01
Remaining Federal Stock............................................           20.75             198        41.00
Federal Average....................................................          100.00             198       197.62
----------------------------------------------------------------------------------------------------------------
* All building first cost data from RS Means 2020.

    DOE determined that the total incremental first cost estimate for 
Federal buildings (as mapped to the prototype buildings in Table IV.1) 
is a savings of $139.4 million (at a 3 percent discount rate) and a 
cost of $85.5 million (based on a 7 percent discount rate), with an 
average first cost decrease of $1.0 per square foot (at a 3 percent 
discount rate) and $0.61 per square foot (at a 3 percent discount 
rate).
    For annualized energy cost savings, DOE used a similar approach to 
that used for incremental first cost. That is, DOE developed the 
national annualized energy cost savings \20\ for building types by 
multiplying the average (across climate zones) energy cost savings 
(determined from the DOE ASHRAE Standard 90.1 cost-effectiveness 
analysis) by the fraction of the Federal sector construction volume 
shown in Table IV.1, and then multiplying that by the total estimate of 
Federal new construction floorspace.\21\ Table IV.6 \22\ shows the 
annual energy cost savings by prototype buildings for a Clean Energy 
Rule compliant building compared to ASHRAE Standard 90.1-2019. There 
are increases in energy costs across the board, this is because despite 
the increases in equipment efficiency and overall site energy savings 
the difference between the cost of fossil fuels (primarily natural gas) 
and purchased electricity at a national level are too high for the 
improvements to overcome. The EIA AEO 2021 energy outlook rate 
projections indicate that per the same amount of site energy consumed, 
electricity is about 4.3x more expensive than natural gas, this number 
gradually reduces over time per this projection down to 3.2x by the 
year 2050.
---------------------------------------------------------------------------

    \20\ The energy costs used were the national average energy 
costs used by ASHRAE in the development of Standard 90.1-2019. To 
quote the cost-effectiveness analysis report ``Energy rates used to 
calculate the energy costs from the modeled energy usage were $0.98/
therm for fossil fuel and $0.1063/kWh for electricity. These rates 
were used for the 90.1-2019 energy analysis and derived from the EIA 
data. These were the values approved by the SSPC 90.1 for cost-
effectiveness for the evaluation of individual addenda during the 
development of 90.1-2019.''
    \21\ For the Federal office building, the small and large office 
prototype LCCs were weighted by estimated fraction of small and 
large offices observed in the FRPP MS database over the past 10 
years of construction. For the Federal education building, the 
primary school prototype LCC was used. For the Federal dorm/barracks 
building type, the small office, small hotel and mid-rise apartment 
prototype LCCs were averaged.
    \22\ Note that the values in Table IV.5 have been adjusted to 
reflect 2020$ from the table that appears in DOE's determination of 
energy savings for Standard 90.1-2016, which were in 2018$. This 
adjustment was made using the GDP deflator value to correct for 
inflation between 2018 and 2020. Organization for Economic Co-
operation and Development, GDP Implicit Price Deflator in United 
States, retrieved from FRED, Federal Reserve Bank of St. Louis; 
fred.stlouisfed.org/series/USAGDPDEFAISMEI, Updated February 17, 
2021. These values have also been adjusted to reflect the same 
underlying economic assumptions as the 2019 version.
---------------------------------------------------------------------------

    As was done for the incremental cost analysis, the 2019 energy cost 
savings analysis was adjusted to use the same underlying economic 
assumptions as the Clean Energy Rule Compliant version, including fuel 
prices, fuel price escalations, labor and material costs, and the 
removal of sales tax. The resulting total annualized energy cost 
impacts for the Clean Energy Rule affected buildings' 14.7 million 
square feet of annual construction for years 2025-2029 and 2.6 million 
square feet of annual construction for years 2030-2054 was estimated to 
be an additional cost of $10.6 million/yr (at a 3 percent discount 
rate) and $8.3 million/yr (at a 7 percent discount rate). The 
annualized energy cost impacts were estimated to be an additional $2.28 
per square foot (at a 3 percent discount rate) and -1.78 per square 
foot (at a 3 percent discount rate). Note the annual energy cost 
impacts are for one year of Federal commercial and high-rise multi-
family residential construction and that those

[[Page 78403]]

impacts accumulate over the evaluation period.

  Table IV.6--Annualized Energy Costs (2021$) for ASHRAE Standard 90.1-2019 vs. Fossil Fuel Compliant Building
                                                     Design
----------------------------------------------------------------------------------------------------------------
                                               Annualized energy  cost savings   Annualized energy cost  savings
                                    Total                 (M$2021)                   intensity  (M$2021/SF)
       Building prototype         prototype  -------------------------------------------------------------------
                                  usage  (%)    3%  Discount     7%  Discount     3%  Discount     7%  Discount
                                                    rate             rate             rate             rate
----------------------------------------------------------------------------------------------------------------
Small Office...................        14.78          ($1.57)          ($1.23)          ($0.34)          ($0.26)
Medium Office..................         5.53           (0.59)           (0.46)           (0.13)           (0.10)
Large Office...................         2.26           (0.24)           (0.19)           (0.05)           (0.04)
Stand-Alone Retail.............         8.76           (0.93)           (0.73)           (0.20)           (0.16)
Strip Mall.....................         0.00             0.00             0.00             0.00             0.00
Primary School.................         1.02           (0.11)           (0.08)           (0.02)           (0.02)
Secondary School...............        18.06           (1.91)           (1.50)           (0.41)           (0.32)
Outpatient Health Care.........         5.76           (0.61)           (0.48)           (0.13)           (0.10)
Hospital.......................        12.68           (1.34)           (1.05)           (0.29)           (0.23)
Small Hotel....................         1.18           (0.12)           (0.10)           (0.03)           (0.02)
Large Hotel....................         0.00             0.00             0.00             0.00             0.00
Quick-service Restaurant.......         0.00             0.00             0.00             0.00             0.00
Full-service Restaurant........         0.00             0.00             0.00             0.00             0.00
Mid-Rise Apartment.............         8.95           (0.95)           (0.74)           (0.20)           (0.16)
High-Rise Apartment............         7.90           (0.84)           (0.66)           (0.18)           (0.14)
Non-Refrigerated Warehouse.....        13.12           (1.39)           (1.09)           (0.30)           (0.23)
                                --------------------------------------------------------------------------------
    Total......................       100.00          (10.60)           (8.30)           (2.28)           (1.78)
----------------------------------------------------------------------------------------------------------------
Note: Negative numbers represent an increase cost.

    For LCC net savings, DOE used a similar approach to that used for 
incremental first cost and first year energy cost savings. That is, DOE 
developed the national annual LCC net savings \23\ for the entire rule 
by multiplying the average (across climate zones) LCC net savings 
(determined from the DOE ASHRAE Standard 90.1 cost-effectiveness 
analysis) by the fraction of the Federal sector construction volume 
shown in Table IV.1, and then multiplying that by the total estimate of 
Federal new construction floorspace.\24\ Table IV.7 shows annual LCC 
net savings by prototype buildings for the Clean Energy Rule Compliant 
Case compared to ASHRAE Standard 90.1-2019. As was done for the 
incremental cost analysis, the 2019 LCC analysis was adjusted to use 
the same underlying economic assumptions as the Clean Energy Rule 
Compliant Case, including fuel prices, fuel price escalations, labor 
and material costs, and the removal of sales tax. The resulting total 
LCC net savings for 14.7 million square feet of annual construction for 
years 2025-2029 and 2.6 million square feet of annual construction for 
years 2030-2054 was estimated to be a cost of $56.13 million (at a 3 
percent discount rate) and a cost of $4.07 million (based on a 7 
percent discount rate). The average LCC net impacts in year 1 was 
estimated to be a cost of $12.09 million (at a 3 percent discount rate) 
and a cost of $0.88 million (based on a 7 percent discount rate. Note 
the annual LCC savings are for one year of Federal commercial and high-
rise multi-family residential construction and that those savings would 
accumulate over the LCC evaluation period. For the purpose of this 
analysis, DOE relied on a 30-year period.\25\
---------------------------------------------------------------------------

    \23\ The energy costs used were the national average energy 
costs used by ASHRAE in the development of Standard 90.1-2019. To 
quote the cost-effectiveness analysis report ``Energy rates used to 
calculate the energy costs from the modeled energy usage were $0.98/
therm for fossil fuel and $0.1063/kWh for electricity. These rates 
were used for the 90.1-2019 energy analysis and derived from the EIA 
data. These were the values approved by the SSPC 90.1 for cost-
effectiveness for the evaluation of individual addenda during the 
development of 90.1-2019.''
    \24\ For the Federal office building, the small and large office 
prototype LCCs were weighted by estimated fraction of small and 
large offices observed in the FRPP MS database over the past 10 
years of construction. For the Federal education building, the 
primary school prototype LCC was used. For the Federal dorm/barracks 
building type, the small office, small hotel and mid-rise apartment 
prototype LCCs were averaged.
    \25\ Lavappa, P and J Kneifel. 2021. Energy Price Indices and 
Discount Factors for Life-Cycle Cost Analysis-2021 Annual Supplement 
to NIST Handbook 135.

  Table IV.7--Annual Net Life-Cycle Cost (LCC) (2021$) for ASHRAE Standard 90.1-2019 vs. Fossil Fuel Compliant
                                                 Building Design
----------------------------------------------------------------------------------------------------------------
                                                Cumulative LCC  cost savings,     Annualized LCC cost savings,
                                    Total                 (M$2021)                    annualized  (M$2021)
       Building prototype         prototype  -------------------------------------------------------------------
                                  usage  (%)    3%  Discount     7%  Discount     3%  Discount     7%  Discount
                                                    rate             rate             rate             rate
----------------------------------------------------------------------------------------------------------------
Small Office...................        14.78          ($8.30)          ($0.60)          ($0.45)          ($0.13)
Medium Office..................         5.53           (3.10)           (0.23)           (0.17)           (0.05)
Large Office...................         2.26           (1.27)           (0.09)           (0.07)           (0.02)
Stand-Alone Retail.............         8.76           (4.92)           (0.36)           (0.27)           (0.08)

[[Page 78404]]

 
Strip Mall.....................         0.00             0.00             0.00             0.00             0.00
Primary School.................         1.02           (0.57)           (0.04)           (0.03)           (0.01)
Secondary School...............        18.06          (10.13)           (0.73)           (0.55)           (0.16)
Outpatient Health Care.........         5.76           (3.24)           (0.23)           (0.17)           (0.05)
Hospital.......................        12.68           (7.12)           (0.52)           (0.38)           (0.11)
Small Hotel....................         1.18           (0.66)           (0.05)           (0.04)           (0.01)
Large Hotel....................         0.00             0.00             0.00             0.00             0.00
Quick-service Restaurant.......         0.00             0.00             0.00             0.00             0.00
Full-service Restaurant........         0.00             0.00             0.00             0.00             0.00
Mid-Rise Apartment.............         8.95           (5.02)           (0.36)           (0.27)           (0.08)
High-Rise Apartment............         7.90           (4.43)           (0.32)           (0.24)           (0.07)
Non-Refrigerated Warehouse.....        13.12           (7.37)           (0.53)           (0.40)           (0.12)
                                --------------------------------------------------------------------------------
    Total......................       100.00          (56.13)           (4.07)           (0.45)           (0.88)
----------------------------------------------------------------------------------------------------------------
Note: Negative numbers represent an increase cost or disbenefit.

    DOE also conducted a net benefits and costs analysis using a 30-
year analysis period and an assumed building lifetime of 30 years. The 
building lifetime assumption was made to correspond with availability 
of underlying data from the cost-effectiveness analysis conducted by 
DOE's State building energy codes program.
    DOE calculated the net present value (``NPV'') of the change in 
equipment cost and reduced operating cost associated with the 
difference between the Clean Energy Rule compliant case and ASHRAE 
90.1-2019. The NPV is the value in the present of a time-series of 
costs and savings, equal to the present value of savings in operating 
cost minus the present value of the increased total equipment cost.
    DOE determined the total increased equipment cost for each year of 
the analysis period (2024-2053) using the incremental construction cost 
described previously. DOE determined the present value of operating 
cost savings for each year from the beginning of the analysis period to 
the year when all Federal buildings constructed by 2054 have been 
retired, assuming a 30-year lifetime of the building.
    The average annual operating cost includes the costs for energy, 
repair, or replacement of building components (e.g., heating and 
cooling equipment, lighting, and envelope measures), and maintenance of 
the building. DOE determined the per-unit annual increase in operating 
cost based on the differences in energy costs plus replacement and 
maintenance cost savings, which were calculated in the underlying cost-
effectiveness analysis by DOE's State building energy codes program. 
While DOE used the methodology and prices described above to calculate 
first year energy cost savings and LCC net savings, for the NPV 
calculations, DOE determined the per-unit annual savings in operating 
cost by multiplying the per square foot annual electricity and natural 
gas savings in energy consumption by the appropriate energy price from 
EIA's AEO2021.\26\ DOE forecasted energy prices based on projected 
average annual price changes in EIA's AEO2021 to develop the operating 
cost savings through the analysis period.
---------------------------------------------------------------------------

    \26\ DOE--U.S. Department of Energy. 2022. Annual Energy Outlook 
2022 with Projections to 2050. Washington, DC. Available at 
www.eia.gov/outlooks/aeo/.
---------------------------------------------------------------------------

    DOE uses national discount rates to calculate national NPV. DOE 
estimated NPV using both a 3-percent and a 7-percent real discount 
rate, in accordance with the Office of Management and Budget's guidance 
to Federal agencies on the development of regulatory analysis, 
particularly section E therein: Identifying and Measuring Benefits and 
Costs.\27\ The NPV is the sum over time of the discounted net savings.
---------------------------------------------------------------------------

    \27\ Office of Management and Budget. OMB Circular A-4, 
Regulatory Analysis. 2003. OMB: Washington, DC, September 17, 2003. 
www.whitehouse.gov/sites/whitehouse.gov/files/omb/circulars/A4/a-4.pdf.
---------------------------------------------------------------------------

    The present value of increased equipment costs is the annual total 
cost increase in each year (the difference between The Clean Energy 
Rule Compliant Case and ASHRAE 90.1-2019), discounted to the present, 
and summed throughout the analysis period (2024 through 2053) plus 30-
year lifetime. Because new construction is held constant through the 
analysis period, the installed cost is constant.
    The present value of savings in operating cost is the annual 
savings in operating cost (the difference between The Clean Energy Rule 
Compliant Case and ASHRAE 90.1-2019), discounted to the present and 
summed through the analysis period (2024 through 2053) plus 30-year 
lifetime. Savings are decreases in operating cost associated with the 
higher energy efficiency associated with buildings designed to the 
Clean Energy Rule Compliant Case compared to ASHRAE 90.1-2019. Total 
annual savings in operating cost are the savings per square foot 
multiplied by the number of square feet that survive in a particular 
year through the lifetime of the buildings constructed in the last year 
of the analysis period.

B. Emissions Analysis

    The emissions analysis consists of two components. The first 
component estimates the effect of potential Federal building energy 
standards on power sector and site (where applicable) combustion 
emissions of CO2, NOX, SO2, and Hg. 
The second component estimates the impacts of potential Federal 
building energy standards on emissions of two additional greenhouse 
gases, CH4 and N2O, as well as the changes to 
emissions of other gases due to ``upstream'' activities in the fuel 
production chain. These upstream activities comprise extraction, 
processing, and transporting fuels to the site of combustion.
    The analysis of electric power sector emissions of CO2, 
NOX, SO2, and Hg uses emissions factors intended 
to

[[Page 78405]]

represent the marginal impacts of the change in electricity consumption 
associated with Federal building energy standards. The methodology is 
based on results published for the AEO, including a set of side cases 
that implement a variety of efficiency-related policies. The analysis 
presented in this notice uses projections from AEO2022. Power sector 
emissions of CH4 and N2O from fuel combustion are 
estimated using Emission Factors for Greenhouse Gas Inventories 
published by the Environmental Protection Agency (``EPA'').\28\
---------------------------------------------------------------------------

    \28\ Available at www.epa.gov/sites/production/files/2021-04/documents/emission-factors_apr2021.pdf (last accessed July 12, 
2021).
---------------------------------------------------------------------------

    Until 2030, the on-site operation of construction subject to this 
proposed rule allows combustion of fossil fuels and results in 
emissions of CO2, NOX, SO2, 
CH4, and N2O where these products are used. Site 
emissions of these gases were estimated using Emission Factors for 
Greenhouse Gas Inventories and, for NOX and SO2 
emissions intensity factors from an EPA publication.\29\
---------------------------------------------------------------------------

    \29\ U.S. Environmental Protection Agency. External Combustion 
Sources. In Compilation of Air Pollutant Emission Factors. AP-42. 
Fifth Edition. Volume I: Stationary Point and Area Sources. Chapter 
1. Available at https://www.epa.gov/air-emissions-factors-and-quantification/ap-42-compilation-air-emissions-factors (last 
accessed April 15, 2022).
---------------------------------------------------------------------------

    FFC upstream emissions, which include emissions from fuel 
combustion during extraction, processing, and transportation of fuels, 
and ``fugitive'' emissions (direct leakage to the atmosphere) of 
CH4 and CO2, are estimated based on the 
methodology described in chapter 1 of the NOPR TSD.
    The emissions intensity factors are expressed in terms of physical 
units per MWh or MMBtu of site energy savings. For power sector 
emissions, specific emissions intensity factors are calculated by 
sector and end use. Total emissions changes are estimated using the 
energy savings calculated in the national impact analysis with energy 
savings derived from a load shifting modeling analysis of ASHRAE 
Prototype models.
1. Air Quality Regulations Incorporated in DOE's Analysis
    DOE's no-new-standards case for the electric power sector reflects 
the AEO, which incorporates the projected impacts of existing air 
quality regulations on emissions. AEO2022 generally represents current 
legislation and environmental regulations, including recent government 
actions, that were in place at the time of preparation of AEO2022, 
including the emissions control programs discussed in the following 
paragraphs.\30\
---------------------------------------------------------------------------

    \30\ For further information, see the Assumptions to AEO2022 
report that sets forth the major assumptions used to generate the 
projections in the Annual Energy Outlook. Available at www.eia.gov/outlooks/aeo/assumptions/ (last accessed April 15, 2022).
---------------------------------------------------------------------------

    SO2 emissions from affected electric generating units 
(``EGUs'') are subject to nationwide and regional emissions cap-and-
trade programs. Title IV of the Clean Air Act sets an annual emissions 
cap on SO2 for affected EGUs in the 48 contiguous States and 
the District of Columbia (D.C.). (42 U.S.C. 7651 et seq.) 
SO2 emissions from numerous States in the eastern half of 
the United States are also limited under the Cross-State Air Pollution 
Rule (``CSAPR''). 76 FR 48208 (Aug. 8, 2011). CSAPR requires these 
States to reduce certain emissions, including annual SO2 
emissions, and went into effect as of January 1, 2015.\31\ AEO2022 
incorporates implementation of CSAPR, including the update to the CSAPR 
ozone season program emission budgets and target dates issued in 2016. 
81 FR 74504 (Oct. 26, 2016).\32\ Compliance with CSAPR is flexible 
among EGUs and is enforced through the use of tradable emissions 
allowances. Under existing EPA regulations, for states subject to 
SO2 emissions limits under CSAPR, excess SO2 
emissions allowances resulting from the lower electricity demand caused 
by the adoption of an efficiency standard could be used to permit 
offsetting increases in SO2 emissions by another regulated 
EGU.
---------------------------------------------------------------------------

    \31\ CSAPR requires states to address annual emissions of 
SO2 and NOX, precursors to the formation of 
fine particulate matter (PM2.5) pollution, in order to 
address the interstate transport of pollution with respect to the 
1997 and 2006 PM2.5 National Ambient Air Quality 
Standards (``NAAQS''). CSAPR also requires certain states to address 
the ozone season (May-September) emissions of NOX, a 
precursor to the formation of ozone pollution, in order to address 
the interstate transport of ozone pollution with respect to the 1997 
ozone NAAQS. 76 FR 48208 (Aug. 8, 2011). EPA subsequently issued a 
supplemental rule that included an additional five states in the 
CSAPR ozone season program; 76 FR 80760 (Dec. 27, 2011) 
(Supplemental Rule), and EPA issued the CSAPR Update for the 2008 
ozone NAAQS. 81 FR 74504 (Oct. 26, 2016).
    \32\ In Sept. 2019, the D.C. Court of Appeals remanded the 2016 
CSAPR Update to EPA. In April 2021, EPA finalized the 2021 CSAPR 
Update which resolved the interstate transport obligations of 21 
states for the 2008 ozone NAAQS. 86 FR 23054 (April 30, 2021); see 
also, 86 FR 29948 (June 4, 2021) (correction to preamble). The 2021 
CSAPR Update became effective on June 29, 2021. The release of AEO 
2021 in February 2021 predated the 2021 CSAPR Update.
---------------------------------------------------------------------------

    However, beginning in 2016, SO2 emissions began to fall 
as a result of the Mercury and Air Toxics Standards (``MATS'') for 
power plants. 77 FR 9304 (Feb. 16, 2012). In the MATS final rule, EPA 
established a standard for hydrogen chloride as a surrogate for acid 
gas hazardous air pollutants (``HAP''), and also established a standard 
for SO2 (a non-HAP acid gas) as an alternative equivalent 
surrogate standard for acid gas HAP. The same controls are used to 
reduce HAP and non-HAP acid gas; thus, SO2 emissions are 
being reduced as a result of the control technologies installed on 
coal-fired power plants to comply with the MATS requirements for acid 
gas. In order to continue operating, coal power plants must have either 
flue gas desulfurization or dry sorbent injection systems installed. 
Both technologies, which are used to reduce acid gas emissions, also 
reduce SO2 emissions. Because of the emissions reductions 
under the MATS, it is unlikely that excess SO2 emissions 
allowances resulting from the lower electricity demand would be needed 
or used to permit offsetting increases in SO2 emissions by 
another regulated EGU.
    CSAPR also established limits on NOX emissions for 
numerous States in the eastern half of the United States. Impacts from 
this Clean Energy Rule would have little effect on NOX 
emissions in those States covered by CSAPR emissions limits if excess 
NOX emissions allowances resulting from the lower 
electricity demand could be used to permit offsetting increases in 
NOX emissions from other EGUs. In such case, NOx emissions 
would remain near the limit even if electricity generation goes down. A 
different case could possibly result, depending on the configuration of 
the power sector in the different regions and the need for allowances, 
such that NOX emissions might not remain at the limit in the 
case of lower electricity demand. In this case, Federal building 
standards might reduce NOX emissions in covered States. 
Despite this possibility, DOE has chosen to be conservative in its 
analysis and has maintained the assumption that standards will not 
reduce NOX emissions in States covered by CSAPR. Federal 
building standards would be expected to reduce NOX emissions 
in the States not covered by CSAPR.
    DOE estimated mercury emissions reduction using emissions factors 
based on AEO2022, which incorporates the MATS.

C. Monetization of Emissions Changes

    As part of the development of this rule, for the purpose of 
complying with the requirements of Executive Order 12866, DOE 
considered the estimated monetary climate and health benefits and 
disbenefits from the changes in

[[Page 78406]]

emissions of CO2, CH4, N2O, 
NOX, and SO2 that are expected to result from 
this rule. DOE considered the emissions changes expected to result over 
the lifetime of buildings constructed in the analysis period. This 
section summarizes the basis for the values used for monetizing the 
emissions changes and presents the values considered in this rule.
    On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-
30087) granted the federal government's emergency motion for stay 
pending appeal of the February 11, 2022, preliminary injunction issued 
in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of 
the Fifth Circuit's order, the preliminary injunction is no longer in 
effect, pending resolution of the federal government's appeal of that 
injunction or a further court order. Among other things, the 
preliminary injunction enjoined the defendants in that case from 
``adopting, employing, treating as binding, or relying upon'' the 
interim estimates of the social cost of greenhouse gases--which were 
issued by the Interagency Working Group on the Social Cost of 
Greenhouse Gases on February 26, 2021--to monetize the benefits and 
disbenefits of changing greenhouse gas emissions. In the absence of 
further intervening court orders, DOE will revert to its approach prior 
to the injunction and present monetized benefits and disbenefits where 
appropriate and permissible under law.
1. Monetization of Greenhouse Gas Emissions
    For the purpose of complying with the requirements of Executive 
Order 12866, DOE estimates the monetized benefits and disbenefits of 
the changes in emissions of CO2, CH4, and 
N2O by using a measure of the social cost (``SC'') of each 
pollutant (e.g., SC-CO2). These estimates represent the 
monetary value of the net harm to society associated with a marginal 
increase in emissions of these pollutants in a given year, or the 
benefit of avoiding that increase. These estimates are intended to 
include (but are not limited to) climate-change-related changes in net 
agricultural productivity, human health, property damages from 
increased flood risk, disruption of energy systems, risk of conflict, 
environmental migration, and the value of ecosystem services. DOE 
exercises its own judgment in presenting monetized climate benefits and 
disbenefits as recommended by applicable Executive orders and guidance, 
and DOE would reach the same conclusion presented in this notice in the 
absence of the social cost of greenhouse gases, including the February 
2021 Interim Estimates presented by the Interagency Working Group on 
the Social Cost of Greenhouse Gases.
    DOE estimated the climate benefits and disbenefits of 
CO2, CH4, and N2O changes (i.e., SC-
GHGs) using the estimates presented in the Technical Support Document: 
Social Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates 
under Executive Order 13990 published in February 2021 by the 
Interagency Working Group on the Social Cost of Greenhouse Gases (IWG) 
(IWG, 2021).\33\ The SC-GHGs is the theoretically appropriate value to 
use in conducting benefit-cost analyses of policies that affect 
CO2, N2O and CH4 emissions. As a 
member of the IWG involved in the development of the February 2021 SC-
GHG TSD, the DOE agrees that the interim SC-GHG estimates represent the 
most appropriate estimate of the SC-GHG until revised estimates have 
been developed reflecting the latest, peer-reviewed science.
---------------------------------------------------------------------------

    \33\ See Interagency Working Group on Social Cost of Greenhouse 
Gases, Technical Support Document: Social Cost of Carbon, Methane, 
and Nitrous Oxide. Interim Estimates Under Executive Order 13990, 
Washington, DC, February 2021. Available at: www.whitehouse.gov/wp-content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitrousOxide.pdf 
(last accessed March 17, 2021).
---------------------------------------------------------------------------

    The SC-GHGs estimates presented here were developed over many 
years, using transparent process, peer-reviewed methodologies, the best 
science available at the time of that process, and with input from the 
public. Specifically, in 2009, an interagency working group (``IWG'') 
that included the DOE and other executive branch agencies and offices 
was established to ensure that agencies had access to the best 
available information when quantifying the benefits of reducing 
CO2 emissions in benefit-cost analyses. The IWG published 
estimates of the social cost of carbon (``SC-CO2'') in 2010 
that were developed from an ensemble of three widely cited integrated 
assessment models (``IAMs'') that estimate climate damages using highly 
aggregated representations of climate processes and the global economy 
combined into a single modeling framework. The three IAMs were run 
using a common set of input assumptions in each model for future 
population, economic, and CO2 emissions growth, as well as 
equilibrium climate sensitivity (``ECS'')--a measure of the globally 
averaged temperature response to increased atmospheric CO2 
concentrations. These estimates were updated in 2013 based on new 
versions of each IAM. In August 2016 the IWG published estimates of the 
social cost of methane (``SC-CH4'') and nitrous oxide (``SC-
N2O'') using methodologies that are consistent with the 
methodology underlying the SC-CO2 estimates. The modeling 
approach that extends the IWG SC-CO2 methodology to non-
CO2 GHGs has undergone multiple stages of peer review. The 
SC-CH4 and SC-N2O estimates were developed by 
Marten et al. (2015) and underwent a standard double-blind peer review 
process prior to journal publication.
    In 2015, as part of the response to public comments received to a 
2013 solicitation for comments on the SC-CO2 estimates, the 
IWG announced a National Academies of Sciences, Engineering, and 
Medicine review of the SC-CO2 estimates to offer advice on 
how to approach future updates to ensure that the estimates continue to 
reflect the best available science and methodologies. In January 2017, 
the National Academies released their final report, Valuing Climate 
Damages: Updating Estimation of the Social Cost of Carbon Dioxide, and 
recommended specific criteria for future updates to the SC-
CO2 estimates, a modeling framework to satisfy the specified 
criteria, and both near-term updates and longer-term research needs 
pertaining to various components of the estimation process (National 
Academies, 2017).\34\ Shortly thereafter, in March 2017, President 
Trump issued Executive Order 13783, which disbanded the IWG, withdrew 
the previous TSDs, and directed agencies to ensure SC-CO2 
estimates used in regulatory analyses are consistent with the guidance 
contained in OMB's Circular A-4, ``including with respect to the 
consideration of domestic versus international impacts and the 
consideration of appropriate discount rates'' (E.O. 13783, Section 
5(c)). Benefit-cost analyses following E.O. 13783 used SC-GHG estimates 
that attempted to focus on the U.S.-specific share of climate change 
damages as estimated by the models (and so did not reflect many 
pathways by which physical impacts outside the United States affect the 
welfare of U.S. citizens and residents) and were calculated using two 
default discount rates recommended by Circular A-4, 3

[[Page 78407]]

percent and 7 percent.\35\All other methodological decisions and model 
versions used in SC-GHG calculations remained the same as those used by 
the IWG in 2010 and 2013, respectively.
---------------------------------------------------------------------------

    \34\ See National Academies of Sciences, Engineering, and 
Medicine. 2017. Valuing Climate Damages: Updating Estimation of the 
Social Cost of Carbon Dioxide. Washington, DC: The National 
Academies Press. doi.org/10.17226/24651.
    \35\ DOE regulatory analyses under E.O. 13783 included 
sensitivity analyses based on global SC-GHG values and using a lower 
discount rate of 2.5%. OMB Circular A-4 (2003) recognizes that 
special considerations arise when applying discount rates if 
intergenerational effects are important. In the IWG's 2015 Response 
to Comments, OMB--as a co-chair of the IWG--made clear that 
``Circular A-4 is a living document,'' that ``the use of 7 percent 
is not considered appropriate for intergenerational discounting,'' 
and that ``[t]here is wide support for this view in the academic 
literature, and it is recognized in Circular A-4 itself.'' OMB, as 
part of the IWG, similarly repeatedly confirmed that ``a focus on 
global SCC estimates in [regulatory impact analyses] is 
appropriate'' (IWG 2015).
---------------------------------------------------------------------------

    On January 20, 2021, President Biden issued Executive Order 13990, 
which re-established the IWG and directed it to develop updated 
estimates of the social cost of carbon and other greenhouse gases that 
reflect the best available science and the recommendations of the 
National Academies (2017). The IWG was tasked with first reviewing the 
SC-GHG estimates currently used in Federal analyses and publishing 
interim estimates within 30 days of the E.O. that reflect the full 
impact of GHG emissions, including by taking global damages into 
account.
    As noted previously, DOE participated in the IWG but has also 
independently evaluated the interim SC-GHG estimates published in the 
February 2021 TSD and determined they are appropriate to use here to 
estimate the climate benefits and disbenefits associated with this 
proposed rule. DOE and other agencies intend to undertake a fuller 
update of the SC-GHG estimates that takes into consideration the advice 
of the National Academies (2017) and other recent scientific 
literature. The DOE has also evaluated the supporting rationale of the 
February 2021 TSD, including the studies and methodological issues 
discussed therein, and concludes that it agrees with the rationale for 
these estimates presented in the TSD and summarized below.
    The February 2021 SC-GHG TSD provides a complete discussion of the 
IWG's initial review conducted under E.O. 13990. In particular, the IWG 
found that the SC-GHG estimates used under E.O. 13783 fail to reflect 
the full impact of GHG emissions in multiple ways. First, the IWG found 
that the SC-GHG estimates used under E.O. 13783 fail to fully capture 
many climate impacts that affect the welfare of U.S. citizens and 
residents, and those impacts are better reflected by global measures of 
the SC-GHG. Examples of effects omitted from the E.O. 13783 estimates 
include direct effects on U.S. citizens, assets, and investments 
located abroad, supply chains, U.S. military assets and interests 
abroad, and tourism, and spillover pathways such as economic and 
political destabilization and global migration that can lead to adverse 
impacts on U.S. national security, public health, and humanitarian 
concerns. In addition, assessing the benefits of U.S. GHG mitigation 
activities requires consideration of how those actions may affect 
mitigation activities by other countries, as those international 
mitigation actions will provide a benefit to U.S. citizens and 
residents by mitigating climate impacts that affect U.S. citizens and 
residents. A wide range of scientific and economic experts have 
emphasized the issue of reciprocity as support for considering global 
damages of GHG emissions. If the United States does not consider 
impacts on other countries, it is difficult to convince other countries 
to consider the impacts of their emissions on the United States. The 
only way to achieve an efficient allocation of resources for emissions 
reduction on a global basis--and so benefit the U.S. and its citizens--
is for all countries to base their policies on global estimates of 
damages. As a member of the IWG involved in the development of the 
February 2021 SC-GHG TSD, DOE agrees with this assessment and, 
therefore, in this rule DOE centers attention on a global measure of 
SC-GHG. This approach is the same as that taken in DOE regulatory 
analyses from 2012 through 2016. A robust estimate of climate damages 
to U.S. citizens and residents that accounts for the myriad of ways 
that global climate change reduces the net welfare of U.S. populations 
does not currently exist in the literature. As explained in the 
February 2021 TSD, existing estimates are both incomplete and an 
underestimate of total damages that accrue to the citizens and 
residents of the U.S. because they do not fully capture the regional 
interactions and spillovers discussed previously, nor do they include 
all of the important physical, ecological, and economic impacts of 
climate change recognized in the climate change literature. As noted in 
the February 2021 SC-GHG TSD, the IWG will continue to review 
developments in the literature, including more robust methodologies for 
estimating a U.S.-specific SC-GHG value, and explore ways to better 
inform the public of the full range of carbon impacts. As a member of 
the IWG, DOE will continue to follow developments in the literature 
pertaining to this issue.
    Second, the IWG found that the use of the social rate of return on 
capital (7 percent under current OMB Circular A-4 guidance) to discount 
the future benefits and disbenefits of reducing GHG emissions 
inappropriately underestimates the impacts of climate change for the 
purposes of estimating the SC-GHG. Consistent with the findings of the 
National Academies (2017) and the economic literature, the IWG 
continued to conclude that the consumption rate of interest is the 
theoretically appropriate discount rate in an intergenerational context 
(IWG 2010, 2013, 2016a, 2016b),\36\ and recommended that discount rate 
uncertainty and relevant aspects of intergenerational ethical 
considerations be accounted for in selecting future discount rates.
---------------------------------------------------------------------------

    \36\ Interagency Working Group on Social Cost of Carbon. Social 
Cost of Carbon for Regulatory Impact Analysis under Executive Order 
12866. 2010. United States Government. (Last accessed April 15, 
2022.) www.epa.gov/sites/default/files/2016-12/documents/scc_tsd_2010.pdf; Interagency Working Group on Social Cost of 
Carbon. Technical Update of the Social Cost of Carbon for Regulatory 
Impact Analysis Under Executive Order 12866. 2013. (Last accessed 
April 15, 2022.) www.federalregister.gov/documents/2013/11/26/2013-28242/technical-support-document-technical-update-of-the-social-cost-of-carbon-for-regulatory-impact; Interagency Working Group on 
Social Cost of Greenhouse Gases, United States Government. Technical 
Support Document: Technical Update on the Social Cost of Carbon for 
Regulatory Impact Analysis-Under Executive Order 12866. August 2016. 
(Last accessed January 18, 2022.) www.epa.gov/sites/default/files/2016-12/documents/sc_co2_tsd_august_2016.pdf; Interagency Working 
Group on Social Cost of Greenhouse Gases, United States Government. 
Addendum to Technical Support Document on Social Cost of Carbon for 
Regulatory Impact Analysis under Executive Order 12866: Application 
of the Methodology to Estimate the Social Cost of Methane and the 
Social Cost of Nitrous Oxide. August 2016. (Last accessed January 
18, 2022.) www.epa.gov/sites/default/files/2016-12/documents/addendum_to_sc-ghg_tsd_august_2016.pdf.
---------------------------------------------------------------------------

    Furthermore, the damage estimates developed for use in the SC-GHG 
are estimated in consumption-equivalent terms, and so an application of 
OMB Circular A-4's guidance for regulatory analysis would then use the 
consumption discount rate to calculate the SC-GHG. DOE agrees with this 
assessment and will continue to follow developments in the literature 
pertaining to this issue. DOE also notes that while OMB Circular A-4, 
as published in 2003, recommends using 3% and 7% discount rates as 
``default'' values, Circular A-4 also reminds agencies that ``different 
regulations may call for different emphases in the analysis, depending 
on the nature and complexity of the regulatory issues and the 
sensitivity of the benefit and cost

[[Page 78408]]

estimates to the key assumptions.'' On discounting, Circular A-4 
recognizes that ``special ethical considerations arise when comparing 
benefits and costs across generations,'' and Circular A-4 acknowledges 
that analyses may appropriately ``discount future costs and consumption 
benefits . . . at a lower rate than for intragenerational analysis.'' 
In the 2015 Response to Comments on the Social Cost of Carbon for 
Regulatory Impact Analysis, OMB, DOE, and the other IWG members 
recognized that ``Circular A-4 is a living document'' and ``the use of 
7 percent is not considered appropriate for intergenerational 
discounting. There is wide support for this view in the academic 
literature, and it is recognized in Circular A-4 itself.'' Thus, DOE 
concludes that a 7% discount rate is not appropriate to apply to value 
the social cost of greenhouse gases in the analysis presented in this 
analysis. In this analysis, to calculate the present and annualized 
values of climate benefits and disbenefits, DOE uses the same discount 
rate as the rate used to discount the value of damages from future GHG 
emissions, for internal consistency. That approach to discounting 
follows the same approach that the February 2021 TSD recommends ``to 
ensure internal consistency--i.e., future damages from climate change 
using the SC-GHG at 2.5 percent should be discounted to the base year 
of the analysis using the same 2.5 percent rate.'' DOE has also 
consulted the National Academies' 2017 recommendations on how SC-GHG 
estimates can ``be combined in RIAs with other cost and benefits 
estimates that may use different discount rates.'' The National 
Academies reviewed ``several options,'' including ``presenting all 
discount rate combinations of other costs and benefits with [SC-GHG] 
estimates.''
    As a member of the IWG involved in the development of the February 
2021 SC-GHG TSD, DOE agrees with this assessment and will continue to 
follow developments in the literature pertaining to this issue. While 
the IWG works to assess how best to incorporate the latest, peer 
reviewed science to develop an updated set of SC-GHG estimates, it 
recommended the interim use of the mot SC-GHG estimates developed by 
the IWG prior to the group being disbanded in 2017. The estimates rely 
on the same models and harmonized inputs and are calculated using a 
range of discount rates. As explained in the February 2021 SC-GHG TSD, 
the IWG has recommended that agencies to revert to the same set of four 
values drawn from the SC-GHG distributions based on three discount 
rates as were used in regulatory analyses between 2010 and 2016 and 
subject to public comment. For each discount rate, the IWG combined the 
distributions across models and socioeconomic emissions scenarios 
(applying equal weight to each) and then selected a set of four values 
recommended for use in benefit-cost analyses: an average value 
resulting from the model runs for each of three discount rates (2.5 
percent, 3 percent, and 5 percent), plus a fourth value, selected as 
the 95th percentile of estimates based on a 3 percent discount rate. 
The fourth value was included to provide information on potentially 
higher-than-expected economic impacts from climate change. As explained 
in the February 2021 SC-GHG TSD, and DOE agrees, this update reflects 
the immediate need to have an operational SC-GHG for use in regulatory 
benefit-cost analyses and other applications that was developed using a 
transparent process, peer-reviewed methodologies, and the science 
available at the time of that process. Those estimates were subject to 
public comment in the context of dozens of proposed rulemakings as well 
as in a dedicated public comment period in 2013.
    There are a number of limitations and uncertainties associated with 
the SC-GHG estimates. First, the current scientific and economic 
understanding of discounting approaches suggests discount rates 
appropriate for intergenerational analysis in the context of climate 
change are likely to be less than 3 percent, near 2 percent or 
lower.\37\ Second, the IAMs used to produce these interim estimates do 
not include all of the important physical, ecological, and economic 
impacts of climate change recognized in the climate change literature 
and the science underlying their ``damage functions''--i.e., the core 
parts of the IAMs that map global mean temperature changes and other 
physical impacts of climate change into economic (both market and 
nonmarket) damages--lags behind the most recent research. For example, 
limitations include the incomplete treatment of catastrophic and non-
catastrophic impacts in the integrated assessment models, their 
incomplete treatment of adaptation and technological change, the 
incomplete way in which inter-regional and intersectoral linkages are 
modeled, uncertainty in the extrapolation of damages to high 
temperatures, and inadequate representation of the relationship between 
the discount rate and uncertainty in economic growth over long time 
horizons. Likewise, the socioeconomic and emissions scenarios used as 
inputs to the models do not reflect new information from the last 
decade of scenario generation or the full range of projections. The 
modeling limitations do not all work in the same direction in terms of 
their influence on the SC-CO2 estimates. However, as 
discussed in the February 2021 TSD, the IWG has recommended that, taken 
together, the limitations suggest that the interim SC-GHG estimates 
used in this rule likely underestimate the damages from GHG emissions. 
DOE concurs with this assessment.
---------------------------------------------------------------------------

    \37\ Interagency Working Group on Social Cost of Greenhouse 
Gases (IWG). 2021. Technical Support Document: Social Cost of 
Carbon, Methane, and Nitrous Oxide Interim Estimates under Executive 
Order 13990. February. United States Government. Available at: 
<https://www.whitehouse.gov/briefing-room/blog/2021/02/26/a-return-to-science-evidence-based-estimates-of-the-benefits-of-reducing-climate-pollution/.
---------------------------------------------------------------------------

    DOE's derivations of the SC-GHGs (i.e., SC-CO2, SC-
N2O, and SC-CH4) values used for this rule are 
discussed in the following sections, and the results of DOE's analyses 
estimating the benefits and disbenefits of the changes in emissions of 
these pollutants are presented in section V.A. of this document.
a. Social Cost of Carbon
    The SC-CO2 values used for this rule were generated 
using the values presented in the 2021 update from the IWG's February 
2021 TSD. Table IV.8 shows the updated sets of SC-CO2 
estimates from the latest interagency update in 5-year increments from 
2020 to 2050. The full set of annual values used is presented in the 
SNOPR TSD. For purposes of capturing the uncertainties involved in 
regulatory impact analysis, DOE has determined it is appropriate 
include all four sets of SC-CO2 values, as recommended by 
the IWG.\38\
---------------------------------------------------------------------------

    \38\ For example, the February 2021 TSD discusses how the 
understanding of discounting approaches suggests that discount rates 
appropriate for intergenerational analysis in the context of climate 
change may be lower than 3 percent.

[[Page 78409]]



                    Table IV.8--Annual SC-CO2 Values From 2021 Interagency Update, 2020-2050
                                           [2020$ per metric ton CO2]
----------------------------------------------------------------------------------------------------------------
                                                                              Discount rate
                                                       ---------------------------------------------------------
                         Year                                5%           3%          2.5%             3%
                                                       ---------------------------------------------------------
                                                          Average      Average      Average     95th percentile
----------------------------------------------------------------------------------------------------------------
2020..................................................           14           51           76                152
2025..................................................           17           56           83                169
2030..................................................           19           62           89                187
2035..................................................           22           67           96                206
2040..................................................           25           73          103                225
2045..................................................           28           79          110                242
2050..................................................           32           85          116                260
----------------------------------------------------------------------------------------------------------------

    In calculating the potential climate benefits and disbenefits 
resulting from changes in CO2 emissions, DOE used the values 
from the 2021 interagency report, adjusted to 2021$ using the implicit 
price deflator for gross domestic product (``GDP'') from the Bureau of 
Economic Analysis. DOE derived values from 2051 to 2070 based on 
estimates published by EPA.\39\ These estimates are based on methods, 
assumptions, and parameters identical to the 2020-2050 estimates 
published by the IWG. If further analysis of monetized climate benefits 
beyond 2070 becomes available prior to the publication of the final 
rule, DOE will include that analysis in the final rule.
---------------------------------------------------------------------------

    \39\ See EPA, Revised 2023 and Later Model Year Light-Duty 
Vehicle GHG Emissions Standards: Regulatory Impact Analysis, 
Washington, DC, December 2021. Available at: www.epa.gov/system/files/documents/2021-12/420r21028.pdf (last accessed January 13, 
2022).
---------------------------------------------------------------------------

    DOE multiplied the CO2 emissions change estimated for 
each year by the SC-CO2 value for that year in each of the 
four cases. To calculate a present value of the stream of monetized 
climate impacts, DOE discounted the values in each of the four cases 
using the specific discount rate that had been used to obtain the SC-
CO2 values in each case.
b. Social Cost of Methane and Nitrous Oxide
    The SC-CH4 and SC-N2O values used for this 
rule were generated using the values presented in the February 2021 
TSD.\40\ Table IV.9 shows the updated sets of SC-CH4 and SC-
N2O estimates from the latest interagency update in 5-year 
increments from 2020 to 2050. To capture the uncertainties involved in 
regulatory impact analysis, DOE has determined it is appropriate to 
include all four sets of SC-CH4 and SC-N2O 
values, as recommended by the IWG.
---------------------------------------------------------------------------

    \40\ See Interagency Working Group on Social Cost of Greenhouse 
Gases, Technical Support Document: Social Cost of Carbon, Methane, 
and Nitrous Oxide. Interim Estimates Under Executive Order 13990, 
Washington, DC, February 2021. Available at: www.whitehouse.gov/wp-content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitrousOxide.pdf 
(last accessed March 17, 2021).

                                   Table IV.9--Annual SC-CH4 and SC-N2O Values From 2021 Interagency Update, 2020-2050
                                                                 [2020$ per metric ton]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               SC-CH4                                                    SC-N2O
                                     -------------------------------------------------------------------------------------------------------------------
                                                     Discount rate and statistic                               Discount rate and statistic
                Year                 -------------------------------------------------------------------------------------------------------------------
                                           5%           3%          2.5%             3%              5%           3%          2.5%             3%
                                     -------------------------------------------------------------------------------------------------------------------
                                        Average      Average      Average     95th percentile     Average      Average      Average     95th percentile
--------------------------------------------------------------------------------------------------------------------------------------------------------
2020................................          670        1,500        2,000              3,900        5,800       18,000       27,000             48,000
2025................................          800        1,700        2,200              4,500        6,800       21,000       30,000             54,000
2030................................          940        2,000        2,500              5,200        7,800       23,000       33,000             60,000
2035................................        1,100        2,200        2,800              6,000        9,000       25,000       36,000             67,000
2040................................        1,300        2,500        3,100              6,700       10,000       28,000       39,000             74,000
2045................................        1,500        2,800        3,500              7,500       12,000       30,000       42,000             81,000
2050................................        1,700        3,100        3,800              8,200       13,000       33,000       45,000             88,000
--------------------------------------------------------------------------------------------------------------------------------------------------------

    DOE multiplied the CH4 and N2O emissions 
change estimated for each year by the SC-CH4 and SC-
N2O estimates for that year in each of the cases. To 
calculate a present value of the stream of estimated monetized impacts, 
DOE discounted the values in each of the cases using the specific 
discount rate that had been used to obtain the SC-CH4 and 
SC-N2O estimates in each case.
2. Monetization of Other Emissions Impacts
    For the SNOPR, DOE estimated the monetized value of NOX 
and SO2 emissions changes from electricity generation using 
benefit-per-ton estimates for that sector from the EPA's Benefits 
Mapping and Analysis Program.\41\ DOE used EPA's values for 
PM2.5-related benefits associated with NOX and 
SO2 and for ozone-related benefits associated with 
NOX for 2025, 2030, and 2040, calculated with discount rates 
of 3 percent and 7 percent. DOE used linear interpolation to define 
values for the years not given in the 2025 to 2040 period; for years 
beyond 2050 the values are held constant.
---------------------------------------------------------------------------

    \41\ Estimating the Benefit per Ton of Reducing PM2.5 Precursors 
from 21 Sectors. www.epa.gov/benmap/estimating-benefit-ton-reducing-pm25-precursors-21-sectors.
---------------------------------------------------------------------------

    DOE also estimated the monetized value of NOX and 
SO2 emissions

[[Page 78410]]

changes from site use of natural gas in buildings impacted by this rule 
using benefit-per-ton estimates from the EPA's Benefits Mapping and 
Analysis Program. Although none of the sectors covered by EPA refers 
specifically to residential and commercial buildings, the sector called 
``area sources'' would be a reasonable proxy for Federal buildings.\42\ 
The EPA document provides high and low estimates for 2025 and 2030 at 
3- and 7-percent discount rates.\43\ DOE used the same linear 
interpolation and extrapolation as it did with the values for 
electricity generation.
---------------------------------------------------------------------------

    \42\ ``Area sources'' represents all emission sources for which 
states do not have exact (point) locations in their emissions 
inventories. Because exact locations would tend to be associated 
with larger sources, ``area sources'' would be fairly representative 
of small, dispersed sources like homes, businesses and office 
buildings.
    \43\ ``Area sources'' are a category in the 2018 document from 
EPA, but are not used in the 2021 document cited previously. See: 
www.epa.gov/sites/default/files/2018-02/documents/sourceapportionmentbpttsd_2018.pdf.
---------------------------------------------------------------------------

    DOE multiplied the emissions changes (in tons) in each year by the 
associated $/ton values, and then discounted each series using discount 
rates of 3 percent and 7 percent as appropriate.
    We request comment on how to address the monetization of climate 
and health benefits and disbenefits from this proposal.

D. Conclusion

    Table IV.10 provides DOE's estimate of cumulative emissions changes 
expected to result from this rulemaking. DOE acknowledges exchanging 
on-site fossil fuel generated energy for reliance on the electric grid, 
which may still be generating energy with fossil fuels, doesn't 
necessarily lead to an immediate reduction in emissions of GHGs and 
SO2. However, it does prepare federal buildings for a green 
energy future. By ensuring that federal buildings are designed--either 
from the ground up, or when being renovated--to rely on the electric 
grid, the rule ensures that long-term, as the grid integrates more 
renewable energies, emissions will be reduced.

         Table IV.10--Cumulative Emissions Changes in 2025-2084
------------------------------------------------------------------------
                        Pollutant                              Total
------------------------------------------------------------------------
                    Primary (plant) Emissions Changes
------------------------------------------------------------------------
CO2 (million metric tons)...............................            -0.3
Hg (tons)...............................................           -0.01
NOX (thousand tons).....................................            0.54
SO2 (thousand tons).....................................            -1.0
CH4 (thousand tons).....................................            -0.1
N2O (thousand tons).....................................           -0.02
------------------------------------------------------------------------
                       Upstream Emissions Changes
------------------------------------------------------------------------
CO2 (million metric tons)...............................             0.1
Hg (tons)...............................................        -0.00002
NOX (thousand tons).....................................             1.3
SO2 (thousand tons).....................................           -0.01
CH4 (thousand tons).....................................            10.5
N2O (thousand tons).....................................         -0.0004
------------------------------------------------------------------------
                         Total Emissions Changes
------------------------------------------------------------------------
CO2 (million metric tons)...............................            -0.2
Hg (tons)...............................................           -0.01
NOX (thousand tons).....................................             1.9
SO2 (thousand tons).....................................            -1.0
CH4 (thousand tons).....................................            10.4
N2O (thousand tons).....................................          -0.021
------------------------------------------------------------------------
Negative values refer to an increase in emissions.

    Table IV.11 presents the present value of monetized climate 
disbenefits associated with the CO2 emissions changes using 
the full set of SC-CO2 estimates described previously.

[[Page 78411]]



 Table IV.11--Present Value of Monetized Climate Disbenefits From Changes in CO2 Emissions for Clean Energy Rule
                             Construction Impacts 2025-2054 With a 30-Year Lifetime
----------------------------------------------------------------------------------------------------------------
                                                                             SC-CO2 Case
                                                   -------------------------------------------------------------
                                                                    Discount rate and statistics
                                                   -------------------------------------------------------------
                                                         5%            3%           2.5%              3%
                                                   -------------------------------------------------------------
                                                       Average       Average       Average      95th percentile
----------------------------------------------------------------------------------------------------------------
                                                                            Million 2021$
----------------------------------------------------------------------------------------------------------------
Total.............................................         -2.3          -9.4         -14.3               -28.3
----------------------------------------------------------------------------------------------------------------
Note: Negative numbers represent an increase cost or disbenefit. Climate benefits and disbenefits associated
  with CO2 emissions changes occur over 2025-2070. DOE expects additional climate impacts to accrue from CO2
  emissions changes post 2070, but a lack of available SC-CO2 estimates for years beyond 2070 prevents DOE from
  monetizing these additional impacts in this analysis.

    Table IV.12 presents the monetized climate benefits associated with 
the estimated CH4 emissions reduction, and Table IV.13 
presents the monetized climate disbenefits associated with the 
estimated changes in N2O emissions.

Table IV.12--Present Value of Monetized Climate Benefits From Changes in Methane Emissions for Clean Energy Rule
                             Construction Impacts 2025-2054 With a 30-Year Lifetime
----------------------------------------------------------------------------------------------------------------
                                                                             SC-CH4 Case
                                                   -------------------------------------------------------------
                                                                    Discount rate and statistics
                                                   -------------------------------------------------------------
                                                         5%            3%           2.5%              3%
                                                   -------------------------------------------------------------
                                                       Average       Average       Average      95th percentile
----------------------------------------------------------------------------------------------------------------
                                                                            Million 2021$
----------------------------------------------------------------------------------------------------------------
Total.............................................          4.0          12.4          17.4                32.7
----------------------------------------------------------------------------------------------------------------
Note: Climate benefits and disbenefits associated with CH4 emissions changes occur over 2025-2070. DOE expects
  additional climate impacts to accrue from CH4 emissions changes post 2070, but a lack of available SC-CH4
  estimates for years beyond 2070 prevents DOE from monetizing these additional impacts in this analysis.


  Table IV.13--Present Value of Monetized Climate Disbenefits From Changes in Nitrous Oxide Emissions for Clean
                       Energy Rule Construction Impacts 2025-2054 With a 30-Year Lifetime
----------------------------------------------------------------------------------------------------------------
                                                                             SC-N2O Case
                                                   -------------------------------------------------------------
                                                                    Discount rate and statistics
                                                   -------------------------------------------------------------
                                                         5%            3%           2.5%              3%
                                                   -------------------------------------------------------------
                                                       Average       Average       Average      95th percentile
----------------------------------------------------------------------------------------------------------------
                                                                            Million 2021$
----------------------------------------------------------------------------------------------------------------
Total.............................................         -0.1          -0.3          -0.4                -0.7
----------------------------------------------------------------------------------------------------------------
Note: Negative numbers represent an increase cost or disbenefit. Climate benefits and disbenefits associated
  with N2O emissions changes occur over 2025-2070. DOE expects additional climate impacts to accrue from N2O
  emissions changes post 2070, but a lack of available SC-N2O estimates for years beyond 2070 prevents DOE from
  monetizing these additional impacts in this analysis.

    DOE is well aware that scientific and economic knowledge about the 
contribution of CO2 and other GHG emissions to changes in 
the future global climate and the potential resulting damages to the 
global and U.S. economy continues to evolve rapidly. DOE, together with 
other Federal agencies, will continue to review methodologies for 
estimating the monetary value of changes in CO2 and other 
GHG emissions. This ongoing review will consider the comments on this 
subject that are part of the public record for this and other 
rulemakings, as well as other methodological assumptions and issues.
    DOE also estimated the monetary value of the health benefits and 
disbenefits associated with changes in NOX and 
SO2 emissions anticipated to result from this rule. The 
dollar-per-ton values that DOE used are discussed in section V.C of 
this document. Table IV.14 presents the present value for 
NOX emissions reduction calculated using 7-percent and 3-
percent discount rates, and Table IV.15 presents similar results for 
SO2 emissions increases. The results in these tables reflect 
application of EPA's low dollar-per-ton values, which DOE used to be 
conservative.

[[Page 78412]]



                              Table IV.14--Present Value of NOX Emissions Reduction
----------------------------------------------------------------------------------------------------------------
                                3% Discount rate     7% Discount rate     3% Discount rate     7% Discount rate
                                     (low)                (low)                (high)               (high)
----------------------------------------------------------------------------------------------------------------
                                                                 Million 2021$
----------------------------------------------------------------------------------------------------------------
Total.......................                20.2                  6.6                 31.0                 10.9
----------------------------------------------------------------------------------------------------------------


                              Table IV.15--Present Value of SO2 Emissions Increase
----------------------------------------------------------------------------------------------------------------
                                3% Discount rate     7% Discount rate     3% Discount rate     7% Discount rate
                                     (low)                (low)                (high)               (high)
----------------------------------------------------------------------------------------------------------------
                                                                 Million 2021$
----------------------------------------------------------------------------------------------------------------
Total.......................               -54.1                -22.5                -57.8                -23.9
----------------------------------------------------------------------------------------------------------------
Note: Negative numbers represent an increase cost or disbenefit.

    The Federal building energy standards in this proposed rule are 
projected to result in an estimated national increased energy use of 
0.029 quad. The increase is for the full fuel cycle which is 
essentially accounting for source energy impacts. The actual breakdown 
is .001 upstream energy savings and an increase of 0.030 primary energy 
use (energy use impacts at the power plants) for a grand total of an 
increase in .029 quads of full fuel cycle energy. Additionally, the 
Federal building energy standards are projected to result in an 
estimated national CO2 emissions increase of 0.2 Mt (million 
metric tons) according to AEO 2022 emission projection values 
accounting for electricity procured from the grid. It should be noted 
that this is a CO2 emissions increase only and does not 
account for the additional emission impacts from other GHGs such as 
N2O and CH4. When combining CO2 
increases with savings in Methane (CH4) and minor increases 
in N2O into a CO2 equivalent metric, there 
results in an overall net savings of CO2e emissions of 
approximately 0.07 MMT (million metric tons) CO2e.
    Notably, the recent enactment of the Inflation Reduction Act of 
2022 (Pub. L. 117-169) and the Infrastructure Investment and Jobs Act 
(Pub. L. 117-58) will drive power sector emissions reductions in both 
the near-term and the short-term. With these laws in place, U.S. 
economy-wide greenhouse gas emissions are already projected to be 40 
percent below 2005 levels in 2030, with the power sector representing 
the largest source of these reductions. In contrast to the base case 
presented in this rulemaking, there are alternative scenarios for 
projecting the future emissions associated with grid electricity that 
better align with these new policy drivers. These scenarios, discussed 
in section V.A of this document, have a large effect on the net 
emissions impacts of the proposed rulemakings and present larger 
environmental and overall net benefits. With these policy drivers now 
in place, reduced power sector emissions below 40% would only further 
add to the benefits of this proposed rulemaking in the future in terms 
of emissions benefits. These scenarios do not present comprehensive 
profiles for all additional climate factors beyond CO2 
emissions (such as NOX, Hg, N2O, CH4, 
and SO2), and have been presented only in the corresponding 
TSD for reference.
    A more detailed discussion of the basis for these tentative 
conclusions is contained in the remainder of this document and the 
accompanying TSD. Further discussion on the costs and benefits can be 
found in section V.A of this document.

E. Reference Resources

    DOE has prepared a list of resources to help Federal agencies 
address the reduction of fossil fuel-generated energy consumption. 
These resources come in many forms such as design guidance, case 
studies and in a variety of media such as printed documents or 
websites. The resources for energy efficiency improvement will also 
provide guidance for fossil fuel-generated energy consumption 
reductions.
     U.S. Department of Energy, Federal Energy Management 
Program. (https://www.energy.gov/eere/femp/federal-energy-management-program). FEMP provides access to numerous resources and tools that can 
help Federal agencies improve the energy efficiency of new and existing 
buildings.
     U.S. Department of Energy, Building Technologies Program. 
Database of high-performance buildings. (https://buildingdata.energy.gov/).
     U.S. Department of Energy, Better Buildings Program. 
Decarbonization Resource Hub. (https://betterbuildingssolutioncenter.energy.gov/carbon-hub).
     New York State Energy Research and Development Authority 
(NYSERDA). Building Decarbonization Insights. (https://www.nyserda.ny.gov/All-Programs/Empire-Building-Challenge/Building-Decarbonization-Insights)
     New Buildings Institute. Buildings Database. (https://newbuildings.org/resource/getting-to-zero-database/).

V. Procedural Issues and Regulatory Review

A. Review Under Executive Orders 12866 and 13563

    Executive Order (``E.O.'') 12866, ``Regulatory Planning and 
Review,'' as supplemented and reaffirmed by E.O. 13563, ``Improving 
Regulation and Regulatory Review, 76 FR 3821 (Jan. 21, 2011), requires 
agencies, to the extent permitted by law, to (1) propose or adopt a 
regulation only upon a reasoned determination that its benefits justify 
its costs (recognizing that some benefits and costs are difficult to 
quantify); (2) tailor regulations to impose the least burden on 
society, consistent with obtaining regulatory objectives, taking into 
account, among other things, and to the extent practicable, the costs 
of cumulative regulations; (3) select, in choosing among alternative 
regulatory approaches, those approaches that maximize net benefits 
(including potential economic, environmental, public health and safety, 
and other advantages; distributive impacts; and equity); (4) to the 
extent feasible, specify performance objectives, rather than specifying 
the behavior or manner of compliance that regulated entities must 
adopt; and (5) identify and assess available alternatives to direct 
regulation, including providing economic incentives to encourage the 
desired behavior, such as user fees or

[[Page 78413]]

marketable permits, or providing information upon which choices can be 
made by the public. DOE emphasizes as well that E.O. 13563 requires 
agencies to use the best available techniques to quantify anticipated 
present and future benefits and costs as accurately as possible. In its 
guidance, OIRA has emphasized that such techniques may include 
identifying changing future compliance costs that might result from 
technological innovation or anticipated behavioral changes. For the 
reasons stated in the preamble, this proposed regulatory action is 
consistent with these principles.
    Section 6(a) of E.O. 12866 also requires agencies to submit 
``significant regulatory actions'' to the Office of Information and 
Regulatory Affairs (``OIRA'') for review. OIRA has determined that this 
proposed regulatory action constitutes a ``significant regulatory 
action'' under section 3(f) of E.O. 12866. Accordingly, pursuant to 
section 6(a)(3)(C) of E.O. 12866, DOE has provided to OIRA an 
assessment, including the underlying analysis, of benefits and costs 
anticipated from the proposed regulatory action, together with, to the 
extent feasible, a quantification of those costs; and an assessment, 
including the underlying analysis, of costs and benefits of potentially 
effective and reasonably feasible alternatives to the planned 
regulation, and an explanation why the planned regulatory action is 
preferable to the identified potential alternatives. These assessments 
are summarized in the tables that follows, as well as elsewhere in this 
preamble. Further detail can be found in the technical support document 
for this proposed rulemaking.
    DOE's analyses indicate that the proposed regulation would save a 
significant amount of site energy; however, switching from gas loads 
burned on-site to electric loads produced off-site, at national average 
level emission rates, would result in an increase of CO2, 
N2O, Hg, and SO2 emissions with a decrease in 
NOX and CH4 emissions. Electrifying the end-use 
equipment results in emissions that become dependent upon the 
electricity generation mix delivered to the building. Relative to the 
case without the proposed amended standards, Clean Energy Rule 
compliant buildings constructed in the 30-year period that begins in 
the anticipated year of compliance with the proposed amended standards 
(2025-2034) will result in--an increased lifetime energy use of 0.029 
quadrillion British thermal units (``Btu''), or quads.\44\
---------------------------------------------------------------------------

    \44\ The quantity refers to full-fuel-cycle (``FFC'') energy 
savings. FFC energy savings includes the energy consumed in 
extracting, processing, and transporting primary fuels (i.e., coal, 
natural gas, petroleum fuels), and, thus, presents a more complete 
picture of the impacts of energy efficiency standards. For more 
information on the FFC metric, see section on emission within this 
document.
---------------------------------------------------------------------------

    The cumulative net present value (``NPV'') of the proposed 
standards for Clean Energy Rule compliant buildings ranges from -$15.6 
million (at a 7-percent discount rate) to -$85.3 Million (at a 3-
percent discount rate). This NPV expresses the estimated total value of 
future operating-cost savings minus the estimated increased product 
costs for a Clean Energy Rule compliant building constructed in 2025-
2054.
    In addition, the proposed standards for Clean Energy Rule compliant 
buildings are projected to impact emissions of multiple greenhouse 
gases and other pollutants. DOE estimates that the proposed standards 
would result in cumulative emissions (over the same period as for 
energy savings) impacts of an increase of 0.2 million metric tons 
(``Mt'') \45\ of carbon dioxide (``CO2''), an increase of 
1.0 thousand tons of sulfur dioxide (``SO2''), a decrease of 
1.9 thousand tons of nitrogen oxides (``NOX''), a decrease 
of 10.4 thousand tons of methane (``CH4''), an increase of 
0.021 thousand tons of nitrous oxide (``N2O''), and an 
increase of 0.01 tons of mercury (``Hg'').\46\
---------------------------------------------------------------------------

    \45\ A metric ton is equivalent to 1.1 short tons. Results for 
emissions other than CO2 are presented in short tons.
    \46\ DOE calculated emissions changes relative to the no-new-
standards case, which reflects key assumptions in the Annual Energy 
Outlook [2022] (``AEO[2022'']). AEO2022 represents current federal 
and state legislation and final implementation of regulations as of 
the time of its preparation. See section IV.K of this document for 
further discussion of AEO2022 assumptions that effect air pollutant 
emissions.
---------------------------------------------------------------------------

    DOE estimates the monetized net climate benefits from a change in 
emissions of greenhouse gases using four different estimates of the 
social cost of CO2 (``SC-CO2''), the social cost 
of methane (``SC-CH4''), and the social cost of nitrous 
oxide (``SC-N2O''). Together these represent the social cost 
of greenhouse gases (``SC-GHG''). DOE used interim SC-GHG values 
developed by an Interagency Working Group on the Social Cost of 
Greenhouse Gases (``IWG'').\47\ The derivation of these values is 
discussed in section IV. of this document. For presentational purposes, 
the net climate benefits (Including both the climate benefits and 
disbenefits) associated with the average SC-GHG at a 3-percent discount 
rate is $2.8 million, primarily driven by savings in CH4. 
DOE does not have a single central SC-GHG point estimate and it 
emphasizes the importance and value of considering the benefits 
calculated using all four SC-GHG estimates.\48\
---------------------------------------------------------------------------

    \47\ See Interagency Working Group on Social Cost of Greenhouse 
Gases, Technical Support Document: Social Cost of Carbon, Methane, 
and Nitrous Oxide. Interim Estimates Under Executive Order 13990, 
Washington, DC, February 2021, available at www.whitehouse.gov/wp-content/uploads/2021/02/TechnicalSupportDocument_SocialCostofCarbonMethaneNitrousOxide.pdf?so
urce=email.
    \48\ On March 16, 2022, the Fifth Circuit Court of Appeals (No. 
22-30087) granted the federal government's emergency motion for stay 
pending appeal of the February 11, 2022, preliminary injunction 
issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a 
result of the Fifth Circuit's order, the preliminary injunction is 
no longer in effect, pending resolution of the federal government's 
appeal of that injunction or a further court order. Among other 
things, the preliminary injunction enjoined the defendants in that 
case from ``adopting, employing, treating as binding, or relying 
upon'' the interim estimates of the social cost of greenhouse 
gases--which were issued by the Interagency Working Group on the 
Social Cost of Greenhouse Gases on February 26, 2021--to monetize 
the benefits of reducing greenhouse gas emissions. In the absence of 
further intervening court orders, DOE will revert to its approach 
prior to the injunction and present monetized benefits where 
appropriate and permissible under law.
---------------------------------------------------------------------------

    DOE also estimates health disbenefits from changes in 
SO2 and NOX emissions.\49\ DOE estimates the 
present value of the health disbenefits would be $15.9 million using a 
7-percent discount rate, and $33.9 million using a 3-percent discount 
rate which is driven by SO2 emission increases outweighing 
NOX emissions decreases.\50\ DOE is currently only 
monetizing (for SO2 and NOX) PM2.5 
precursor health effects and (for NOX) ozone precursor 
health benefits, but will continue to assess the ability to monetize 
other effects such as health effects from reductions in direct 
PM2.5 emissions.
---------------------------------------------------------------------------

    \49\ DOE estimated the monetized value of NOX and 
SO2 emissions changes associated with the Clean Energy 
Rule using benefit per ton estimates from the scientific literature. 
See section IV.L.2 of this document for further discussion.
    \50\ DOE estimates the economic value of these emissions changes 
resulting from the considered rule for the purpose of complying with 
the requirements of Executive Order 12866.
---------------------------------------------------------------------------

    Table V.1 summarizes the economic benefits and costs expected to 
result from the proposed standards. In the table, total benefits for 
both the 3-percent and 7-percent discount rate cases include monetized 
climate benefits based on the average SC-GHG estimate under 3-percent 
discount rate (thus the climate benefits number stays the same). DOE 
does not have a single central SC-GHG point estimate and it emphasizes 
the importance and value of considering the benefits calculated using 
all four SC-GHG estimates. The estimated total net benefits using each 
of the four cases are presented in section IV of this document.

[[Page 78414]]



                           Table V.1--Summary of Monetized Economic Benefits and Costs
                                [Million 2021$] [2025-2054 plus 30-year lifetime]
----------------------------------------------------------------------------------------------------------------
                                                                                       Million 2021$
                                                                         ---------------------------------------
                                                                           3% Discount rate    7% Discount rate
----------------------------------------------------------------------------------------------------------------
Operating Cost Savings..................................................              -195.5               -89.5
Climate Benefits *......................................................                 2.8                 2.8
Health Benefits **......................................................               -33.9               -15.9
Total Benefits [dagger].................................................              -226.7              -102.7
Incremental Product Costs [dagger][dagger]..............................              -139.4               -85.5
Net Benefits............................................................               -87.3               -17.3
----------------------------------------------------------------------------------------------------------------
Note: This table presents the costs and benefits associated with Federal new commercial and multi-family high-
  rise buildings built and operated in 2025-2084. These results include benefits which accrue after 2054 from
  the buildings constructed in 2025-2054. Climate benefits and disbenefits associated with GHG emissions changes
  occur over 2025-2070. DOE expects additional climate impacts to accrue from GHG emissions changes post 2070,
  but a lack of available SC-CO2, SC-CH4, and SC-N2O estimates for emissions years beyond 2070 prevents DOE from
  monetizing these additional impacts in this analysis.
* Climate benefits are calculated using four different estimates of the social cost of carbon (SC-CO2), methane
  (SC-CH4), and nitrous oxide (SC-N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates;
  95th percentile at 3 percent discount rate). Together these represent the social cost of greenhouse gases (SC-
  GHG). For presentational purposes of this table, the climate benefits associated with the average SC-GHG at a
  3 percent discount rate are shown but the Department does not have a single central SC-GHG point estimate. See
  section IV.C of this document for more details. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-
  30087) granted the federal government's emergency motion for stay pending appeal of the February 11, 2022,
  preliminary injunction issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the
  Fifth Circuit's order, the preliminary injunction is no longer in effect, pending resolution of the federal
  government's appeal of that injunction or a further court order. Among other things, the preliminary
  injunction enjoined the defendants in that case from ``adopting, employing, treating as binding, or relying
  upon'' the interim estimates of the social cost of greenhouse gases--which were issued by the Interagency
  Working Group on the Social Cost of Greenhouse Gases on February 26, 2021--to monetize the benefits of
  reducing greenhouse gas emissions. In the absence of further intervening court orders, DOE will revert to its
  approach prior to the injunction and present monetized benefits where appropriate and permissible under law.
** Health disbenefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only
  monetizing (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits but
  will continue to assess the ability to monetize other effects such as health benefits from reductions in
  direct PM2.5 emissions. See section IV.C of this document for more details.
[dagger] Total and net benefits include those consumer, climate, and health benefits that can be quantified and
  monetized. For presentation purposes, total and net benefits for both the 3-percent and 7-percent cases are
  presented using the average SC-GHG with 3-percent discount rate, but the Department does not have a single
  central SC-GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated
  using all four SC-GHG estimates.
[Dagger] Costs include incremental equipment costs as well as installation costs.

    The benefits and costs of the proposed standards can also be 
expressed in terms of annualized values. The monetary values for the 
total annualized net benefits are (1) the reduced product purchase 
prices and installation costs, minus (2) the increase in operating 
costs, plus (3) the monetized value of changes in GHG, and 
NOX, and SO2 emissions, all annualized.\51\ The 
benefits and disbenefits associated with changes in emissions as a 
result of the proposed standards are also calculated based on the 
lifetime of a Clean Energy Rule compliant building constructed in 2025-
2054.
---------------------------------------------------------------------------

    \51\ To convert the time-series of costs and benefits into 
annualized values, DOE calculated a present value in $2021, the year 
used for discounting the NPV of total costs and savings. For the 
benefits, DOE calculated a present value associated with each year's 
shipments in the year in which the shipments occur (e.g., 2030), and 
then discounted the present value from each year to 2022. Using the 
present value, DOE then calculated the fixed annual payment over a 
30-year period, starting in the compliance year, that yields the 
same present value.
---------------------------------------------------------------------------

    Estimates of annualized benefits and costs of the proposed 
standards are shown in. The results show as the primary estimate 
utilize a 7-percent discount rate for operating benefits, costs, and 
health benefits and disbenefits (from changes to NOX and 
SO2 emissions), and a 3-percent discount rate case for 
climate benefits (from GHG emissions) are as follows:
     Capital cost impacts of the standards proposed in this 
case are estimated to be $7.89 million per year in decreased equipment 
costs.
     Annual operating disbenefits are estimated to be $8.26 
million per year in increased equipment operating costs, primarily 
driven by the higher relative cost of electricity compared to natural 
gas.
     Net climate benefits total $0.15 million per year, 
primarily driven by savings from CH4.
     Net health disbenefits total $1.47 million per year, 
primarily driven by increased SO2 emissions overshadowing 
NOX emissions savings.
     Overall net monetized disbenefits would amount to a cost 
of $1.70 million per year.
    Using a 3-percent discount rate for all benefits, disbenefits and 
costs the annualized results are as follows:
     Capital cost impacts of the standards proposed in this 
case are estimated to be $7.55 million per year in decreased equipment 
costs.
     Annual operating disbenefits are estimated to be $10.58 
million per year in increased equipment operating costs, driven by the 
higher relative cost of electricity compared to natural gas.
     Net Climate benefits total $0.15 million per year, 
primarily driven by savings from CH4.
     Net health disbenefits total $1.84 million per year, 
primarily driven by increased SO2 emissions overshadowing 
NOX emissions savings.
     Overall net monetized disbenefits would amount to a cost 
of $4.73 million per year.

[[Page 78415]]



                    Table V.2--Annualized Monetized Benefits and Costs of Proposed Regulation
                                                 [Million 2021$]
----------------------------------------------------------------------------------------------------------------
                                                                                    Million 2021$/year
                                Category                                 ---------------------------------------
                                                                           3% Discount rate    7% Discount rate
----------------------------------------------------------------------------------------------------------------
Operating Cost Impacts..................................................              -10.58               -8.26
Climate Benefits *......................................................                0.15                0.15
Health Benefits **......................................................               -1.84               -1.47
Total Benefits [dagger].................................................              -12.27               -9.58
Incremental Product Costs [dagger][dagger]..............................               -7.55               -7.89
Net Benefits............................................................               -4.73               -1.70
----------------------------------------------------------------------------------------------------------------
Note: This table presents the costs and benefits associated with the Clean Energy Rule impacted buildings in
  2025-2084. These results include benefits which accrue after 2054 from the buildings constructed in 2025-2054.
* Climate benefits are calculated using four different estimates of the SC-GHG (see section IV.D of this
  document). For presentational purposes of this table, the climate benefits associated with the average SC-GHG
  at a 3 percent discount rate are shown, but the Department does not have a single central SC-GHG point
  estimate. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the federal
  government's emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued
  in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the Fifth Circuit's order, the
  preliminary injunction is no longer in effect, pending resolution of the federal government's appeal of that
  injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in
  that case from ``adopting, employing, treating as binding, or relying upon'' the interim estimates of the
  social cost of greenhouse gases--which were issued by the Interagency Working Group on the Social Cost of
  Greenhouse Gases on February 26, 2021--to monetize the benefits of reducing greenhouse gas emissions. In the
  absence of further intervening court orders, DOE will revert to its approach prior to the injunction and
  presents monetized benefits where appropriate and permissible under law.
** Health disbenefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only
  monetizing (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits but
  will continue to assess the ability to monetize other effects such as health benefits from reductions in
  direct PM2.5 emissions.
[dagger] Total benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-
  percent discount rate, but the Department does not have a single central SC-GHG point estimate. DOE emphasizes
  the importance and value of considering the benefits calculated using all four SC-GHG estimates.
[dagger][dagger] Costs include incremental equipment costs as well as installation costs.

    DOE's analysis of the national impacts of the proposed standards is 
described in sections IV.A, and IV.B of this document.
    Table V.3 presents DOE's evaluation of the economic impacts of the 
proposed regulations, as measured by the average life-cycle cost 
(``LCC'').\52\ The average LCC savings are -$30.1 Million and there is 
no traditional PBP as the incremental capital cost of the proposed 
regulation is negative but the incremental operating cost is positive 
(see section IV of this document).
---------------------------------------------------------------------------

    \52\ The average LCC refer to buildings that are affected by a 
standard and are measured relative to the efficiency distribution in 
the no-new-standards case, which depicts the market in the 
compliance year in the absence of new or amended standards (see 
section E. Impacts of the Rule of this document). The simple PBP, 
which is designed to compare specific building performance levels, 
is measured relative to the baseline compliance case (see section 
V.A of this document).

                Table V.3--Impacts of Proposed Regulation
------------------------------------------------------------------------
                                                   Average LCC savings
  Clean energy rule compliant building policy        (million 2021$)
------------------------------------------------------------------------
3% Discount Rate..............................                   -56.13
7% Discount Rate..............................                   -4.077
------------------------------------------------------------------------

    DOE's analysis is sensitive to how emission factors per unit of 
grid electricity purchased change over time. The base case presented in 
this rulemaking utilizes emission factors obtained through EIA's Annual 
Energy Outlook for 2022 (AEO 2022). This is consistent with the 
methodology used in other rulemakings (including the efficiency 
portions for the analysis behind 10 CFR parts 433 and 435) and 
representative of an expected or ``business as usual'' case. However, 
AEO 2022 does not account for goals or plans to accelerate grid 
decarbonization, such as President Biden's goal to achieve 100% carbon 
pollution-free electricity by 2035. Such accelerated clean grid 
scenarios can significantly impact the overall emissions profile of the 
rule allowing for more climate benefits sooner in the lifecycle of the 
expected projects.
    To demonstrate this proposed rulemaking's sensitivity to purchased 
electricity emission factor ``cleanliness'' projections, DOE analyzed 
an additional case where the future grid emission factors were assumed 
to follow a ``95% reduction by 2035'' (95 by 2035) profile as defined 
in the National Renewable Energy Lab's ``2021 Standard Scenarios 
Report: A U.S. Electricity Sector Outlook'' report presented in the 
technical support document for this rulemaking. This case represents a 
change in national electricity generation which assumes national power 
sector CO2 emissions reach 95% below 2005 levels by 2035 and 
are eliminated on a net basis by 2050. This aggressive case results in 
only three years of annual increases in CO2e gas emissions 
and results in cumulative savings of CO2e emissions just 
after 5 years. Results for the 95 by 2035 case are presented in Table 
V.4 and Table V.5 of this document. Additional details on the 
sensitivity to emission factor progression and an additional case run 
based on the EIA Corporate Goal data are presented in the technical 
support document and environmental assessment supporting this rule. As 
noted previously, these alternative cases are presented to show the 
emissions and climate impacts of this rule in accelerated clean grid 
scenarios that may flow from recent legislation and Administration 
priorities, but that are

[[Page 78416]]

not represented in the base case using AEO 2022 (the ``business as 
usual'' case).

  Table V.4--Summary of Monetized Economic Benefits and Costs (Million 2021$) (2025-2054 Plus 30-Year Lifetime)
                                     for 95 by 35 Emissions Reductions Case
----------------------------------------------------------------------------------------------------------------
                                                                                       Million 2021$
                                                                         ---------------------------------------
                                                                           3% Discount rate    7% Discount rate
----------------------------------------------------------------------------------------------------------------
Operating Cost Savings..................................................              -195.5               -89.5
Climate Benefits *......................................................                92.9                92.9
Health Benefits **......................................................                46.6                15.8
Total Benefits [dagger].................................................               -56.0                19.2
Incremental Product Costs [dagger][dagger]..............................              -139.4               -85.5
Net Benefits............................................................                83.4               104.6
----------------------------------------------------------------------------------------------------------------
Note: This table presents the costs and benefits associated with Federal new commercial and multi-family high-
  rise buildings built in 2025-2084. These results include benefits which accrue after 2054 from the buildings
  constructed in 2025-2054.
* Climate benefits are calculated using four different estimates of the social cost of carbon (SC-CO2), methane
  (SC-CH4), and nitrous oxide (SC-N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates;
  95th percentile at 3 percent discount rate). Together these represent the social cost of greenhouse gases (SC-
  GHG). For presentational purposes of this table, the climate benefits associated with the average SC-GHG at a
  3 percent discount rate are shown but the Department does not have a single central SC-GHG point estimate. See
  section IV.C of this document for more details. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-
  30087) granted the federal government's emergency motion for stay pending appeal of the February 11, 2022,
  preliminary injunction issued in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the
  Fifth Circuit's order, the preliminary injunction is no longer in effect, pending resolution of the federal
  government's appeal of that injunction or a further court order. Among other things, the preliminary
  injunction enjoined the defendants in that case from ``adopting, employing, treating as binding, or relying
  upon'' the interim estimates of the social cost of greenhouse gases--which were issued by the Interagency
  Working Group on the Social Cost of Greenhouse Gases on February 26, 2021--to monetize the benefits of
  reducing greenhouse gas emissions. In the absence of further intervening court orders, DOE will revert to its
  approach prior to the injunction and present monetized benefits where appropriate and permissible under law.
** Health disbenefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only
  monetizing (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits but
  will continue to assess the ability to monetize other effects such as health benefits from reductions in
  direct PM2.5 emissions. See section IV.C of this document for more details.
[dagger] Total and net benefits include those consumer, climate, and health benefits that can be quantified and
  monetized. For presentation purposes, total and net benefits for both the 3-percent and 7-percent cases are
  presented using the average SC-GHG with 3-percent discount rate, but the Department does not have a single
  central SC-GHG point estimate. DOE emphasizes the importance and value of considering the benefits calculated
  using all four SC-GHG estimates.
[dagger][dagger] Costs include incremental equipment costs as well as installation costs.


Table V.5--Annualized Monetized Benefits and Costs of Proposed Regulation (Million 2021$) for 95 by 35 Emissions
                                                 Reductions Case
----------------------------------------------------------------------------------------------------------------
                                                                                    Million 2021$/year
                                Category                                 ---------------------------------------
                                                                           3% Discount rate    7% Discount rate
----------------------------------------------------------------------------------------------------------------
Operating Cost Impacts..................................................              -10.58               -8.26
Climate Benefits *......................................................                5.03                5.03
Health Benefits **......................................................                2.52                1.46
Total Benefits [dagger].................................................               -3.03               -1.77
Incremental Product Costs [dagger][dagger]..............................               -7.55               -7.89
Net Benefits............................................................                4.51                6.11
----------------------------------------------------------------------------------------------------------------
Note: This table presents the costs and benefits associated with Clean Energy Rule impacted buildings in 2025-
  2084. These results include benefits which accrue after 2054 from the buildings constructed in 2025-2054.
* Climate benefits are calculated using four different estimates of the SC-GHG (see section IV.D of this
  document). For presentational purposes of this table, the climate benefits associated with the average SC-GHG
  at a 3 percent discount rate are shown, but the Department does not have a single central SC-GHG point
  estimate. On March 16, 2022, the Fifth Circuit Court of Appeals (No. 22-30087) granted the Federal
  government's emergency motion for stay pending appeal of the February 11, 2022, preliminary injunction issued
  in Louisiana v. Biden, No. 21-cv-1074-JDC-KK (W.D. La.). As a result of the Fifth Circuit's order, the
  preliminary injunction is no longer in effect, pending resolution of the Federal government's appeal of that
  injunction or a further court order. Among other things, the preliminary injunction enjoined the defendants in
  that case from ``adopting, employing, treating as binding, or relying upon'' the interim estimates of the
  social cost of greenhouse gases--which were issued by the Interagency Working Group on the Social Cost of
  Greenhouse Gases on February 26, 2021--to monetize the benefits of reducing greenhouse gas emissions. In the
  absence of further intervening court orders, DOE will revert to its approach prior to the injunction and
  presents monetized benefits where appropriate and permissible under law.
** Health disbenefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only
  monetizing (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits but
  will continue to assess the ability to monetize other effects such as health benefits from reductions in
  direct PM2.5 emissions.
[dagger] Total benefits for both the 3-percent and 7-percent cases are presented using the average SC-GHG with 3-
  percent discount rate, but the Department does not have a single central SC-GHG point estimate. DOE emphasizes
  the importance and value of considering the benefits calculated using all four SC-GHG estimates.
[dagger][dagger] Costs include incremental equipment costs as well as installation costs.

    DOE's analysis of the impacts of the proposed regulation on federal 
agencies is described in section V.A, Cost Effectiveness, of this 
document.

B. Review Under the Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires 
preparation of an initial regulatory flexibility analysis (``IRFA'') 
for any rule that by law must be proposed for public comment, unless 
the agency certifies

[[Page 78417]]

that the rule, if promulgated, will not have a significant economic 
impact on a substantial number of small entities. As required by E.O. 
13272, ``Proper Consideration of Small Entities in Agency Rulemaking,'' 
67 FR 53461 (Aug. 16, 2002), DOE published procedures and policies on 
February 19, 2003, to ensure that the potential impacts of its rules on 
small entities are properly considered during the rulemaking process. 
68 FR 7990. DOE has made its procedures and policies available on the 
Office of the General Counsel's website (www.energy.gov/gc/office-general-counsel).
    This proposed rule applies only to the fossil fuel-generated energy 
consumption of new Federal buildings and Federal buildings undergoing 
major renovation. As such, the only entities directly regulated by this 
rulemaking would be Federal agencies. DOE does not believe that there 
will be any impacts on small entities such as small businesses, small 
organizations, or small governmental jurisdictions.
    On the basis of the foregoing, DOE certifies that this rule will 
not have a significant economic impact on a substantial number of small 
entities. Accordingly, DOE has not prepared a regulatory flexibility 
analysis for this rulemaking. DOE's certification and supporting 
statement of factual basis will be provided to the Chief Counsel for 
Advocacy of the Small Business Administration pursuant to 5 U.S.C. 
605(b).

C. Review Under the Paperwork Reduction Act

    This proposed rulemaking will impose no new information or record 
keeping requirements. Accordingly, OMB clearance is not required under 
the Paperwork Reduction Act. (44 U.S.C. 3501 et seq.)

D. Review Under the National Environmental Policy Act of 1969

    DOE prepared a draft Environmental Assessment (EA) (DOE/EA-1778) 
entitled, ``Environmental Assessment for Final Rulemaking, 10 CFR parts 
433 and 435, Fossil Fuel-Generated Energy Consumption Reduction for New 
Federal Buildings and Major Renovations of Federal Buildings,'' 
pursuant to the Council on Environmental Quality's (CEQ) Regulations 
for Implementing the Procedural Provisions of the National 
Environmental Policy Act (NEPA) (40 CFR parts 1500-1508), NEPA, as 
amended (42 U.S.C. 4321 et seq.), and DOE's NEPA Implementing 
Procedures (10 CFR part 1021).
    The draft EA addresses the possible environmental effects 
attributable to the implementation of this proposed rule. The rule, by 
its fundamental intent, will have a positive impact on the environment. 
The anticipated impacts of this proposed rulemaking are an overall 
decrease in CO2 equivalent gases (despite modest increases 
in base CO2 and N2O emissions, CH4 
emission reductions result in net savings) with an additional decrease 
in NOX emission and an increase in SO2 emissions 
resulting from reduced fossil fuel-generated energy consumption in new 
Federal buildings and major renovations of Federal buildings but 
increased electric purchases from the grid.
    To identify the potential environmental impacts that may result 
from implementing the proposed rule on Federal buildings, DOE compared 
the requirements of the proposed rule shifting all scope 1 stationary 
combustion on site fossil fuel usage to electric with the ``no-action 
alternative''.
    Accordingly, DOE concludes in the draft EA that new Federal 
buildings designed and constructed to be compliant with the Clean 
Energy Rule will not have a significant environmental impact compared 
to Federal buildings designed and constructed to Standard 90.1-2019 
because the site energy impacts are very sensitive to and offset by 
upstream emissions associated with electricity purchased from the grid. 
This change in energy usage translates to varied emissions impacts of 
carbon dioxide (``CO2''), nitrogen oxides 
(``NOX''), mercury (``Hg''), and methane 
(``CH4'') over the 30-year period examined in the EA. As 
reported in the EA, Cumulative emission changes for 30 years of 
construction and operation for Federal buildings built during the 
analysis period (2025 through 2054) were estimated to be an increase of 
174,730 metric tons of CO2, an increase of 907.4 tons of 
SO2, a decrease of 1,597.67 tons of NOX, a 
decrease of 8,917.46 tons of CH4, and an increase of 17.76 
tons of N2O.

E. Review Under Executive Order 13132

    E.O. 13132, ``Federalism,'' 64 FR 43255 (Aug. 10, 1999), imposes 
certain requirements on Federal agencies formulating and implementing 
policies or regulations that preempt State law or that have federalism 
implications. The Executive order requires agencies to examine the 
constitutional and statutory authority supporting any action that would 
limit the policymaking discretion of the States and to carefully assess 
the necessity for such actions. The Executive order also requires 
agencies to have an accountable process to ensure meaningful and timely 
input by State and local officials in the development of regulatory 
policies that have federalism implications. On March 14, 2000, DOE 
published a statement of policy describing the intergovernmental 
consultation process it will follow in the development of such 
regulations. 65 FR 13735. DOE has examined this proposed rule and has 
tentatively determined that it would not have a substantial direct 
effect on the States, on the relationship between the national 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government. Therefore, no 
further action is required by Executive Order 13132.

F. Review Under Executive Order 12988

    With respect to the review of existing regulations and the 
promulgation of new regulations, section 3(a) of E.O. 12988, ``Civil 
Justice Reform,'' imposes on Federal agencies the general duty to 
adhere to the following requirements: (1) eliminate drafting errors and 
ambiguity, (2) write regulations to minimize litigation, (3) provide a 
clear legal standard for affected conduct rather than a general 
standard, and (4) promote simplification and burden reduction. 61 FR 
4729 (Feb. 7, 1996). Regarding the review required by section 3(a), 
section 3(b) of E.O. 12988 specifically requires that executive 
agencies make every reasonable effort to ensure that the regulation: 
(1) clearly specifies the preemptive effect, if any, (2) clearly 
specifies any effect on existing Federal law or regulation, (3) 
provides a clear legal standard for affected conduct while promoting 
simplification and burden reduction, (4) specifies the retroactive 
effect, if any, (5) adequately defines key terms, and (6) addresses 
other important issues affecting clarity and general draftsmanship 
under any guidelines issued by the Attorney General. Section 3(c) of 
Executive Order 12988 requires executive agencies to review regulations 
in light of applicable standards in section 3(a) and section 3(b) to 
determine whether they are met or it is unreasonable to meet one or 
more of them. DOE has completed the required review and determined 
that, to the extent permitted by law, this proposed rule meets the 
relevant standards of E.O. 12988.

G. Review Under the Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (``UMRA'') 
requires each Federal agency to assess the effects of Federal 
regulatory actions on State,

[[Page 78418]]

local, and Tribal governments and the private sector. Public Law 104-4, 
section 201 (codified at 2 U.S.C. 1531). For a proposed regulatory 
action likely to result in a rule that may cause the expenditure by 
State, local, and Tribal governments, in the aggregate, or by the 
private sector of $100 million or more in any one year (adjusted 
annually for inflation), section 202 of UMRA requires a Federal agency 
to publish a written statement that estimates the resulting costs, 
benefits, and other effects on the national economy. (2 U.S.C. 1532(a), 
(b)) The UMRA also requires a Federal agency to develop an effective 
process to permit timely input by elected officers of State, local, and 
Tribal governments on a proposed ``significant intergovernmental 
mandate,'' and requires an agency plan for giving notice and 
opportunity for timely input to potentially affected small governments 
before establishing any requirements that might significantly or 
uniquely affect them. On March 18, 1997, DOE published a statement of 
policy on its process for intergovernmental consultation under UMRA. 62 
FR 12820. DOE's policy statement is also available at www.energy.gov/sites/prod/files/gcprod/documents/umra_97.pdf.
    This proposed rulemaking contains neither an intergovernmental 
mandate nor a mandate that may result in the expenditure of $100 
million or more in any year by State, local and Tribal governments, in 
the aggregate, or by the private sector so these requirements under the 
UMRA do not apply.

H. Review Under the Treasury and General Government Appropriations Act, 
1999

    Section 654 of the Treasury and General Government Appropriations 
Act, 1999 (Pub. L. 105-277) requires Federal agencies to issue a Family 
Policymaking Assessment for any rule that may affect family well-being. 
This proposed rule would not have any impact on the autonomy or 
integrity of the family as an institution. Accordingly, DOE has 
concluded that it is not necessary to prepare a Family Policymaking 
Assessment.

I. Review Under Executive Order 12630

    Pursuant to E.O. 12630, ``Governmental Actions and Interference 
with Constitutionally Protected Property Rights,'' 53 FR 8859 (Mar. 15, 
1988), DOE has determined that this proposed rule would not result in 
any takings that might require compensation under the Fifth Amendment 
to the U.S. Constitution.

J. Review Under the Treasury and General Government Appropriations Act, 
2001

    Section 515 of the Treasury and General Government Appropriations 
Act, 2001 (44 U.S.C. 3516 note) provides for Federal agencies to review 
most disseminations of information to the public under information 
quality guidelines established by each agency pursuant to general 
guidelines issued by OMB. OMB's guidelines were published at 67 FR 8452 
(Feb. 22, 2002), and DOE's guidelines were published at 67 FR 62446 
(Oct. 7, 2002). Pursuant to OMB Memorandum M-19-15, Improving 
Implementation of the Information Quality Act (April 24, 2019), DOE 
published updated guidelines which are available at www.energy.gov/sites/prod/files/2019/12/f70/DOE%20Final%20Updated%20IQA%20Guidelines%20Dec%202019.pdf. DOE has 
reviewed this SNOPR under the OMB and DOE guidelines and has concluded 
that it is consistent with applicable policies in those guidelines.

K. Review Under Executive Order 13211

    E.O. 13211, ``Actions Concerning Regulations That Significantly 
Affect Energy Supply, Distribution, or Use,'' 66 FR 28355 (May 22, 
2001), requires Federal agencies to prepare and submit to OIRA at OMB, 
a Statement of Energy Effects for any proposed significant energy 
action. A ``significant energy action'' is defined as any action by an 
agency that promulgates or is expected to lead to promulgation of a 
final rule, and that (1) is a significant regulatory action under 
Executive Order 12866, or any successor order; and (2) is likely to 
have a significant adverse effect on the supply, distribution, or use 
of energy, or (3) is designated by the Administrator of OIRA as a 
significant energy action. For any proposed significant energy action, 
the agency must give a detailed statement of any adverse effects on 
energy supply, distribution, or use should the proposal be implemented, 
and of reasonable alternatives to the action and their expected 
benefits on energy supply, distribution, and use.
    This proposed rulemaking would not have a significant adverse 
effect on the supply, distribution, or use of energy. Moreover, as the 
rulemaking would result in increased building energy efficiency, it 
would not have a significant adverse effect on energy. For these 
reasons, the rulemaking is not a significant energy action. 
Accordingly, DOE has not prepared a Statement of Energy Effects.

L. Information Quality

    On December 16, 2004, OMB, in consultation with the Office of 
Science and Technology Policy (``OSTP''), issued its Final Information 
Quality Bulletin for Peer Review (``the Bulletin''). 70 FR 2664 (Jan. 
14, 2005). The Bulletin establishes that certain scientific information 
shall be peer reviewed by qualified specialists before it is 
disseminated by the Federal Government, including influential 
scientific information related to agency regulatory actions. The 
purpose of the bulletin is to enhance the quality and credibility of 
the Government's scientific information. Under the Bulletin, EIA's 
CBECS and RECS are ``influential scientific information,'' which the 
Bulletin defines as ``scientific information that the agency reasonably 
can determine will have or does have a clear and substantial impact on 
important public policies or private sector decisions.'' 70 FR 2664, 
2667 (January 14, 2005). The Academy recommendations have been peer 
reviewed pursuant to section II.2 of the Bulletin. Both surveys are 
peer reviewed internally within EIA and other DOE offices before they 
are published. In addition, both surveys are subject to public comment 
that EIA addresses before finalizing CBECS and RECS.

M. Description of Materials Incorporated by Reference

    In this final rule, DOE incorporates by reference ANSI/ASHRAE/IES 
Standard 90.1-2019, Energy Standard for Buildings Except Low-Rise 
Residential Buildings, (I-P Edition), 2019. This standard provides 
minimum requirements for energy efficient designs for buildings except 
for low-rise residential buildings. Copies of this standard are 
available from ASHRAE, Inc., 180 Peachtree Corners, GA 30092, (404) 
636-8400, www.ashrae.org. ASHRAE provides a free, online, read-only 
version of Standard 90.1-2019 available at www.ashrae.org/technical-resources/standards-and-guidelines. Users must scroll down to locate 
and click on Standard 90.1-2019 (IP).
    The Director of the Federal Register previously approved ANSI/
ASHRAE/IES 90.1-2004, 2007, 2010, and 2013, Energy Standard for 
Buildings Except Low-Rise Residential Buildings for incorporation by 
reference in 10 CFR part 433.
    In this final rule, DOE incorporates by reference the ICC 2021 
International Energy Conservation Code, (IECC), Redline Version, 
copyright 2021. This U.S. standard provides minimum requirements for 
energy-efficient

[[Page 78419]]

designs for low-rise residential buildings. Copies of this standard are 
available from the International Code Council, 4051 West Flossmoor 
Road, Country Club Hills, IL 60478, 1-888-422-7233, www.iccsafe.org.
    The Director of the Federal Register previously approved ICC 
International Energy Conservation Code (IECC) 2005, 2009, and 2015 
Editions, for incorporation by reference in 10 CFR part 435.

VI. Public Participation

A. Attendance at the Public Meeting

    The time, date, and location of the public meeting are listed in 
the DATES and ADDRESSES sections at the beginning of this document. 
This meeting will be held via webinar. Webinar registration 
information, participant instructions, and information about the 
capabilities available to webinar participants can be found at the 
following link: https://doe.webex.com/weblink/register/ra441feed3edc105af1383fa6e41e1e39. Participants are responsible for 
ensuring their systems are compatible with the webinar software.
    Please note that foreign nationals attending the meeting are 
subject to advance security screening procedures which require advance 
notice prior to attendance at the public meeting. If a foreign national 
wishes to participate in the public meeting, please inform DOE of this 
fact as soon as possible by contacting Ms. Regina Washington at (202) 
586-1214 or by email ([email protected]) so that the 
necessary procedures can be completed.

B. Procedure for Submitting Prepared General Statements for 
Distribution

    Any person who has plans to present a prepared general statement 
may request that copies of his or her statement be made available at 
the public meeting. Such persons may submit requests, along with an 
advance electronic copy of their statement in PDF (preferred), 
Microsoft Word or Excel, WordPerfect, or text (ASCII) file format, to 
the appropriate address shown in the ADDRESSES section at the beginning 
of this document. The request and advance copy of statements must be 
received at least one week before the public meeting and are to be 
emailed. Please include a telephone number to enable DOE staff to make 
follow-up contact, if needed.

C. Conduct of the Public Meeting

    DOE will designate a DOE official to preside at the public meeting 
and may also use a professional facilitator to aid discussion. The 
meeting will not be a judicial or evidentiary-type public hearing, but 
DOE will conduct it in accordance with section 336 of EPCA. (42 U.S.C. 
6306) A court reporter will be present to record the proceedings and 
prepare a transcript. DOE reserves the right to schedule the order of 
presentations and to establish the procedures governing the conduct of 
the public meeting. There shall not be discussion of proprietary 
information, costs or prices, market share, or other commercial matters 
regulated by U.S. anti-trust laws. After the public meeting, interested 
parties may submit further comments on the proceedings, as well as on 
any aspect of the rulemaking, until the end of the comment period.
    The public meeting will be conducted in an informal, conference 
style. DOE will present a general overview of the topics addressed in 
this rulemaking, allow time for prepared general statements by 
participants, and encourage all interested parties to share their views 
on issues affecting this rulemaking. Each participant will be allowed 
to make a general statement (within time limits determined by DOE), 
before the discussion of specific topics. DOE will allow, as time 
permits, other participants to comment briefly on any general 
statements.
    At the end of all prepared statements on a topic, DOE will permit 
participants to clarify their statements briefly. Participants should 
be prepared to answer questions by DOE and by other participants 
concerning these issues. DOE representatives may also ask questions of 
participants concerning other matters relevant to this rulemaking. The 
official conducting the public meeting will accept additional comments 
or questions from those attending, as time permits. The presiding 
official will announce any further procedural rules or modification of 
the previous procedures that may be needed for the proper conduct of 
the public meeting.
    A transcript of the public meeting will be included in the docket, 
which can be viewed as described in the Docket section at the beginning 
of this document and will be accessible on the DOE website. In 
addition, any person may buy a copy of the transcript from the 
transcribing reporter.

D. Submission of Comments

    DOE will accept comments, data, and information regarding this 
proposed rule before or after the public meeting, but no later than the 
date provided in the DATES section at the beginning of this proposed 
rule. Interested parties may submit comments, data, and other 
information using any of the methods described in the ADDRESSES section 
at the beginning of this document.
    Submitting comments via www.regulations.gov. The 
www.regulations.gov web page will require you to provide your name and 
contact information. Your contact information will be viewable to DOE 
Building Technologies staff only. Your contact information will not be 
publicly viewable except for your first and last names, organization 
name (if any), and submitter representative name (if any). If your 
comment is not processed properly because of technical difficulties, 
DOE will use this information to contact you. If DOE cannot read your 
comment due to technical difficulties and cannot contact you for 
clarification, DOE may not be able to consider your comment.
    However, your contact information will be publicly viewable if you 
include it in the comment itself or in any documents attached to your 
comment. Any information that you do not want to be publicly viewable 
should not be included in your comment, nor in any document attached to 
your comment. Otherwise, persons viewing comments will see only first 
and last names, organization names, correspondence containing comments, 
and any documents submitted with the comments.
    Do not submit to www.regulations.gov information for which 
disclosure is restricted by statute, such as trade secrets and 
commercial or financial information (hereinafter referred to as 
Confidential Business Information (``CBI'')). Comments submitted 
through www.regulations.gov cannot be claimed as CBI. Comments received 
through the website will waive any CBI claims for the information 
submitted. For information on submitting CBI, see the Confidential 
Business Information section.
    DOE processes submissions made through www.regulations.gov before 
posting. Normally, comments will be posted within a few days of being 
submitted. However, if large volumes of comments are being processed 
simultaneously, your comment may not be viewable for up to several 
weeks. Please keep the comment tracking number that www.regulations.gov 
provides after you have successfully uploaded your comment.
    Submitting comments via email. Comments and documents submitted via 
email also will be posted to www.regulations.gov. If you do not want 
your personal contact information to be publicly viewable, do not 
include it in your comment or any accompanying

[[Page 78420]]

documents. Instead, provide your contact information in a cover letter. 
Include your first and last names, email address, telephone number, and 
optional mailing address. The cover letter will not be publicly 
viewable as long as it does not include any comments.
    Include contact information each time you submit comments, data, 
documents, and other information to DOE. No telefacsimiles (``faxes'') 
will be accepted.
    Comments, data, and other information submitted to DOE 
electronically should be provided in PDF (preferred), Microsoft Word or 
Excel, WordPerfect, or text (ASCII) file format. Provide documents that 
are not secured, that are written in English, and that are free of any 
defects or viruses. Documents should not contain special characters or 
any form of encryption and, if possible, they should carry the 
electronic signature of the author.
    Campaign form letters. Please submit campaign form letters by the 
originating organization in batches of between 50 to 500 form letters 
per PDF or as one form letter with a list of supporters' names compiled 
into one or more PDFs. This reduces comment processing and posting 
time.
    Confidential Business Information. Pursuant to 10 CFR 1004.11, any 
person submitting information that he or she believes to be 
confidential and exempt by law from public disclosure should submit via 
email two well-marked copies: one copy of the document marked 
``confidential'' including all the information believed to be 
confidential, and one copy of the document marked ``non-confidential'' 
with the information believed to be confidential deleted. DOE will make 
its own determination about the confidential status of the information 
and treat it according to its determination.
    It is DOE's policy that all comments may be included in the public 
docket, without change and as received, including any personal 
information provided in the comments (except information deemed to be 
exempt from public disclosure).

VII. Approval of the Office of the Secretary

    The Secretary of Energy has approved publication of this 
supplemental notice of proposed rulemaking.

List of Subjects

10 CFR Part 433

    Buildings and facilities, Energy conservation, Engineers, Federal 
buildings and facilities, Fossil fuel reductions, Housing, 
Incorporation by reference, Multi-family residential buildings.

10 CFR Part 435

    Buildings and facilities, Energy conservation, Engineers, Federal 
buildings and facilities, Fossil fuel reductions, Housing, 
Incorporation by reference.

Signing Authority

    This document of the Department of Energy was signed on December 6, 
2022, by Mary Sotos, Director of the Federal Energy Management Program, 
pursuant to delegated authority from the Secretary of Energy. That 
document with the original signature and date is maintained by DOE. For 
administrative purposes only, and in compliance with requirements of 
the Office of the Federal Register, the undersigned DOE Federal 
Register Liaison Officer has been authorized to sign and submit the 
document in electronic format for publication, as an official document 
of the Department of Energy. This administrative process in no way 
alters the legal effect of this document upon publication in the 
Federal Register.

    Signed in Washington, DC, on December 9, 2022.
Treena V. Garrett,
Federal Register Liaison Officer, U.S. Department of Energy.

    For the reasons set forth in the preamble, DOE proposes to amend 
parts 433 and 435 of chapter II of title 10 of the Code of Federal 
Regulations as set forth below:

PART 433--ENERGY EFFICIENCY STANDARDS FOR THE DESIGN AND 
CONSTRUCTION OF NEW FEDERAL COMMERCIAL AND MULTI-FAMILY HIGH-RISE 
RESIDENTIAL BUILDINGS

0
1. The authority citation for part 433 continues to read as follows:

    Authority:  42 U.S.C. 6831-6832, 6834-6835; 42 U.S.C. 7101 et 
seq.

0
2. Amend Sec.  433.1 by adding paragraph (b) to read as follows:


Sec.  433.1   Purpose and scope.

* * * * *
    (b) This part also establishes a maximum allowable fossil fuel-
generated energy consumption standard for new Federal buildings that 
are commercial or multi-family high-rise residential buildings and 
major renovations to Federal buildings that are commercial or multi-
family high-rise residential buildings, for which design for 
construction began on or after [Date one year after date of publication 
in the Federal Register].
* * * * *
0
3. Amend Sec.  433.2 by:
0
a. Adding in alphabetical order the definitions of ``Construction 
cost,'' ``Design for renovation'', ``EISA-subject building or 
project'', ``Federal building,'' ``Fiscal year (FY),'' ``Major 
renovation,'' ``Major renovation cost,'' ``Major renovation of all 
Scope 1 fossil fuel-using systems in a building,'' ``Major renovation 
of a Scope 1 fossil fuel-using building system or Scope 1 fossil fuel-
using component,'' and ``Multi-family high-rise residential 
building,''.
0
b. Revising the definition of ``Proposed building''; and
0
c. Adding in alphabetical order the definition of ``Scope 1 fossil 
fuel-generated energy consumption'', ``Shift adjustment multiplier'' 
and ``Technical impracticability''.
    The additions and revision read as follows:


Sec.  433.2   Definitions.

* * * * *
    Construction cost means all costs associated with design and 
construction of a Federal building. It includes the cost of design, 
permitting, construction (materials and labor), and building 
commissioning. It does not include legal or administrative fees, or the 
cost of acquiring the land.
* * * * *
    Design for renovation means the stage when the energy efficiency 
and sustainability details (such as insulation levels, HVAC systems, 
water-using systems, etc.) are either explicitly determined or 
implicitly included in a renovation project cost specification.
    EISA-subject building or project means, for purposes of this rule, 
any new Federal building or renovation project that is subject to the 
cost thresholds and reporting requirements in Section 433 of EISA 2007 
((42 U.S.C. 6834(a)(3)(D)(i))). The cost threshold referenced in 
Section 433 of EISA is $2.5 million in 2007 dollars. GSA provides a 
table of annual updates to this cost threshold at https://www.gsa.gov/real-estate/design-and-construction/annual-prospectus-thresholds. GSA 
also provides a second cost threshold for renovations of leased 
buildings that is \1/2\ of the cost threshold for renovation of 
Federally owned buildings.
* * * * *
    Federal building as defined in 42 U.S.C. 6832 means any building to 
be constructed by, or for the use of, any Federal agency. Such term 
shall include buildings built for the purpose of being

[[Page 78421]]

leased by a Federal agency, and privatized military housing.
    Fiscal year (FY) begins on October 1 of the year prior to the 
specified calendar year and ends on September 30 of the specified 
calendar year.
* * * * *
    Major renovation means either major renovation of all Scope 1 
fossil fuel-generated/consuming systems in a Federal building or major 
renovation of one or more Scope 1 fossil fuel-using building systems or 
components, as defined in this section.
    Major renovation cost means:
    (1) Preliminary planning, engineering, architectural, legal, 
fiscal, and economic investigations and studies, surveys, designs, 
plans, working drawings, specifications, procedures, and other similar 
actions necessary for the alteration of a public building; and (2) 
Repairing, remodeling, improving, or extending, or other changes in, a 
public building as per 40 U.S.C. 3301(a)(1).
    Major renovation of all Scope 1 fossil fuel-using systems in a 
building means construction on an existing Federal building that is so 
extensive that it replaces all Scope 1 fossil fuel-using systems in the 
building. This term includes, but is not limited to, comprehensive 
replacement or restoration of most or all major systems, interior work 
(such as ceilings, partitions, doors, floor finishes, etc.), or 
building elements and features.
    Major renovation of a Scope 1 fossil fuel-using building system or 
Scope 1 fossil fuel-using component means changes to a Federal building 
that provide significant opportunities for energy efficiency or 
reduction in fossil fuel-related energy consumption. This includes, but 
is not limited to, replacement of the HVAC system, hot water system, or 
cooking system, or other fossil fuel-using systems or components of the 
building that have a major impact on fossil fuel usage.
    Multi-family high-rise residential building means a residential 
Federal building that contains 3 or more dwelling units and that is 
designed to be 4 or more stories above grade.
* * * * *
    Proposed building means the design for construction of a new 
Federal commercial or multi-family high-rise residential building, 
proposed for construction, or a major renovation to a Federal 
commercial or multi-family high-rise residential building.
* * * * *
    Scope 1 fossil fuel-generated energy consumption means, for 
purposes of this proposed rule, the on-site stationary combustion of 
fossil fuels that contribute to Scope 1 emissions for generation of 
electricity, heat, cooling, or steam as defined by ``Federal Greenhouse 
Gas Accounting and Reporting Guidance'' (Council on Environmental 
Quality, January 17, 2016), including but not limited to, combustion of 
fuels in stationary sources (e.g., boilers, furnaces, turbines, and 
emergency generators). This term does not include mobile sources, 
fugitive emissions, or process emissions as defined by ``Federal 
Greenhouse Gas Accounting and Reporting Guidance'' (Council on 
Environmental Quality, January 17, 2016).
    Shift adjustment multiplier means that agencies can apply a 
multiplication factor to their Maximum Allowable Fossil Fuel-Generated 
Energy Consumption by Building Category target based upon the weekly 
hours of active operation of the building. The weekly hours of 
operation to use as a basis for the shift adjustment multiplier lookup 
should be based upon the time in which in the building is actively 
occupied and operating per its intended use type and should include 
unoccupied hours or other times of limited use (such as night-time 
setback hours).
    Technical impracticability means achieving the Scope 1 fossil fuel-
generated energy consumption targets would (1) not be feasible from an 
engineering design or execution standpoint due to existing physical or 
site constraints that prohibit modification or addition of elements or 
spaces (2) significantly obstruct building operations and the 
functional needs of a building, specifically for industrial process 
loads, critical national security functions, mission critical 
information systems as defined in NIST SP 800-60 Vol. 2 Rev. 1, and 
research operations, or (3) significantly degrade energy resiliency and 
energy security of building operations as defined in 10 U.S.C. 
101(e)(6) and 10 U.S.C. 101(e)(7) respectively. Upon determination that 
complying with the Clean Energy Rule is technically impracticable, the 
building is still required to reduce fossil fuel consumption to the 
maximum extent practicable. Technical impracticability may include 
technology availability and cost considerations but may not be based 
solely on cost considerations.
0
4. Amend Sec.  433.3 by revising paragraph (b)(5) to read as follows:


Sec.  433.3   Materials incorporated by reference.

* * * * *
    (b) * * *
    (5) ANSI/ASHRAE/IES 90.1-2019, (``ASHRAE 90.1-2019''), Energy 
Standard for Buildings Except Low-Rise Residential Buildings, I-P 
Edition, copyright 2019, IBR approved for Sec. Sec.  433.2, 433.100, 
433.101, 433.201 and appendix A to this subpart.
0
5. Subpart B is added to part 433 to read as follows:

Subpart B--Reduction in Scope 1 Fossil Fuel-Generated Energy 
Consumption

Sec.
433.200 Scope 1 Fossil fuel-generated energy consumption 
requirement.
433.201 Scope 1 Fossil fuel-generated energy consumption 
determination.
433.202 Petition for downward adjustment.
Appendix A to Subpart B of Part 433--Maximum Allowable Scope 1 
Fossil Fuel-Generated Energy Consumption


Sec.  433.200   Scope 1 Fossil fuel-generated energy consumption 
requirement.

    (a) New EISA-Subject buildings. (1) New Federal buildings that are 
commercial or multi-family high-rise residential buildings, for which 
design for construction began on or after December 21, 2023, must be 
designed to meet the requirements of paragraph (c) of this section if 
the cost of the building is at least $2,500,000 (in 2007 dollars, 
adjusted for inflation). See GSA Annual Prospectus Thresholds at 
www.gsa.gov/real-estate/design-construction/gsa-annual-prospectus-thresholds.
    (2) Reserved.
    (b) Major renovations of EISA-Subject buildings. (1) Major 
renovations to Federal buildings that are commercial or multi-family 
high-rise residential buildings, for which design for construction 
began on or after December 21, 2023, must be designed to meet the 
requirements of paragraph (c) or (d) of this section, as applicable, 
if:
    (i) The renovation is a major renovation to a public building as 
defined in 40 U.S.C. 3301 and for which transmittal of a prospectus to 
Congress is required under 40 U.S.C. 3307; or
    (ii) The cost of the major renovation of a Federally owned building 
is at least $2,500,000 (in 2007 dollars, adjusted for inflation). The 
cost of a major renovation for a Federally leased building is at least 
$1,250,000 (in 2007 dollars). See GSA Annual Prospectus Thresholds at 
www.gsa.gov/real-estate/design-construction/gsa-annual-prospectus-thresholds.
    (2) This subpart only applies to major renovations that meet the 
major renovation of all scope 1 fossil fuel-using systems in a Federal 
building or the major renovation of a scope 1 fossil fuel-using 
building system or scope 1

[[Page 78422]]

fossil fuel-using component definition in Sec.  433.2.
    (3) For leased buildings, this subpart applies to major renovations 
only if the building was originally built for the use of any Federal 
agency, including being leased by a Federal agency.
    (4) This subpart applies only to the portions of the proposed 
building or proposed building systems that are being renovated and to 
the extent that the scope of the renovations permits compliance with 
the applicable requirements of this subpart. Unaltered portions of the 
proposed building or proposed building systems are not required to 
comply with this subpart.
    (c) Federal buildings that are of the type included in Appendix A 
of this subpart.
    (1) New Construction and Major Renovations of all Scope 1 Fossil 
Fuel-Using Systems in EISA-Subject Buildings.
    (i) Design for construction began during fiscal year 2024 through 
fiscal year 2029. For new construction or major renovations of all 
Scope 1 fossil-fuel using systems in a Federal building for which 
design for construction or renovation, as applicable, began during 
fiscal year 2024 through 2029, the Scope 1 fossil fuel-generated energy 
consumption of the proposed building, based on the building design and 
calculated according to Sec.  433.201(a), must not exceed the value 
identified in Tables A-1a to A-2a (if targets based on emissions are 
used) or Tables A-1b to A-2b (if targets based on kBtu of fossil fuel 
usage are used) of appendix A of this subpart for the associated 
building type, climate zone, and fiscal year in which design for 
construction began.
    (A) Federal agencies may apply a shift adjustment multiplier to the 
values in Tables A-1a to A-2a or Tables A-1b to A-2b based on the 
following baseline hours of operation assumed in Tables A-1a to A-2a or 
Tables A-1b to A-2b.
    (B) To calculate the shift adjustment multiplier, agencies shall 
estimate the number of shifts for their new building and multiply by 
the appropriate factor shown below in Table VII.1 of this section for 
their building type. The Scope 1 fossil fuel-generated energy 
consumption target for the building would be the value in either Tables 
A-1a to A-2a or Tables A-1b to A-2b multiplied by the multiplier 
calculated in the previous sentence.

                Table VII.1--Shift Adjustment Multiplier by Hours of Operation and Building Type
----------------------------------------------------------------------------------------------------------------
                                                                             Weekly hours of operation
                     Building activity/type                      -----------------------------------------------
                                                                    50 or less       51 to 167          168
----------------------------------------------------------------------------------------------------------------
Admin/professional office.......................................               1               1             1.4
Bank/other financial............................................               1               1             1.4
Government office...............................................               1               1             1.4
Medical office (non-diagnostic).................................               1               1             1.4
Mixed-use office................................................               1               1             1.4
Other office....................................................               1               1             1.4
Laboratory......................................................               1               1             1.4
Distribution/shipping center....................................             0.7             1.4             2.1
Nonrefrigerated warehouse.......................................             0.7             1.4             2.1
Convenience store...............................................               1               1             1.4
Convenience store with gas......................................               1               1             1.4
Grocery store/food market.......................................               1               1             1.4
Other food sales................................................               1               1             1.4
Fire station/police station.....................................             0.8             0.8             1.1
Other public order and safety...................................             0.8             0.8             1.1
Medical office (diagnostic).....................................               1               1             1.5
Clinic/other outpatient health..................................               1               1             1.5
Refrigerated warehouse..........................................               1               1               1
Religious worship...............................................             0.9             1.7             1.7
Entertainment/culture...........................................             0.8             1.5             1.5
Library.........................................................             0.8             1.5             1.5
Recreation......................................................             0.8             1.5             1.5
Social/meeting..................................................             0.8             1.5             1.5
Other public assembly...........................................             0.8             1.5             1.5
College/university..............................................             0.8             1.3             1.3
Elementary/middle school........................................             0.8             1.3             1.3
High school.....................................................             0.8             1.3             1.3
Preschool/daycare...............................................             0.8             1.3             1.3
Other classroom education.......................................             0.8             1.3             1.3
Fast food.......................................................             0.4             1.1             2.1
Restaurant/cafeteria............................................             0.4             1.1             2.1
Other food service..............................................             0.4             1.1             2.1
Hospital/inpatient health.......................................               1               1               1
Nursing home/assisted living....................................               1               1               1
Dormitory/fraternity/sorority...................................               1               1               1
Hotel...........................................................               1               1               1
Motel or inn....................................................               1               1               1
Other lodging...................................................               1               1               1
Vehicle dealership/showroom.....................................             0.8             1.2             1.8
Retail store....................................................             0.8             1.2             1.8
Other retail....................................................             0.8             1.2             1.8
Post office/postal center.......................................             0.7             1.5             1.5
Repair shop.....................................................             0.7             1.5             1.5
Vehicle service/repair shop.....................................             0.7             1.5             1.5
Vehicle storage/maintenance.....................................             0.7             1.5             1.5
Other service...................................................             0.7             1.5             1.5

[[Page 78423]]

 
Strip shopping mall.............................................               1               1               1
Enclosed mall...................................................               1               1               1
Bar/Pub/Lounge..................................................               1               1             1.4
Courthouse/Probation Office.....................................               1               1             1.4
----------------------------------------------------------------------------------------------------------------

    (ii) Design for construction began during or after fiscal year 
2030. For new construction or major renovations of all fossil fuel-
using systems in an EISA-Subject building for which design for 
construction or renovation, as applicable, began during or after fiscal 
year 2030, the Scope 1 fossil fuel-generated energy consumption of the 
proposed building, based on building design and calculated according to 
Sec.  433.201(a), must be zero.
    (2) Major Renovations of a Federal Building System or Component 
within an EISA-Subject Building. System level renovations shall follow 
the renovation requirements in section 4.2.1.3 of the applicable 
building baseline energy efficiency standards listed in Sec.  433.100 
substituting the ``design for construction'' with ``design for 
renovation'' for the relevant date and shall replace all equipment that 
is included in the renovation with all electric or non-fossil fuel 
using ENERGY STAR or Federal Energy Management Program (FEMP) 
designated products as defined in Sec.  436.42. For component level 
renovations, Agencies shall replace all equipment that is part of the 
renovation with all electric or non-fossil fuel using ENERGY STAR or 
FEMP designated products as defined in Sec.  436.42.

    (3) Mixed-use buildings. (i) For Federal buildings subject to the 
requirements of paragraph (c)(1) of this section that combine two or 
more building types identified in Tables 1a to 2a or Tables 1b to 2b of 
appendix A of this subpart, the maximum allowable fossil fuel-generated 
energy consumption of the proposed building is equal to the averaged 
applicable building type values in Tables A-1a to A-2a or Tables A-1b 
to A-2b weighted by floor area of the two or more building types. The 
equation which follows shall be used for mixed use buildings.

Equation 1: Scope 1 Fossil fuel-generated energy consumption for a 
mixed-use building = the sum across all building uses of (the fraction 
of total floor building floor area for building use i times the 
allowable fossil fuel-generated energy consumption for building use i)

    Equation 1 may be rewritten as:

Scope 1 Fossil Fuel-Generated Energy Consumption for a Mixed Use 
Building = [Sigma]ni=1 (Fraction of Total Building Floor 
Area for Building Use i times Allowable Scope 1 Fossil Fuel-Generated 
Energy Consumption for Building Use).

    (ii) For example, if a proposed building for which design for 
construction began in FY2026 that is to be built in climate zone 4a has 
a total of 200 square feet--100 square feet of which qualifies as 
College/University and 100 square feet of which qualifies as 
Laboratory--the maximum allowable Scope 1 fossil fuel-generated energy 
consumption is equal to:

[(100 sqft. x 3 kBtu/yr.-sqft.) + (100 sqft x 10 kBtu/yr.-sqft.)]/200 
sqft. = 6.5 kBtu/yr.-sqft.

    (d) Federal buildings that are of the type not included in Appendix 
A of this subpart--
    (1) Process load buildings. For building types that are not 
included in any of the building types listed in Tables A-1a to A-2a or 
A-1b to A-2b of appendix A of this subpart, or for building types in 
these tables that contain significant process loads that are not likely 
to be found in the Commercial Buildings Energy Consumption Survey 
(CBECS) and qualify for exemption per Sec.  433.202, Federal agencies 
must select the applicable building type, climate zone, and fiscal year 
in which design for construction began from Tables 1a to 2a or 1b to 2b 
of appendix A of this subpart that most closely corresponds to the 
proposed building without the process load. The estimated Scope 1 
fossil fuel-generated energy consumption of the process load must be 
added to the maximum allowable Scope 1 fossil fuel-generated energy 
consumption of the applicable building type for the appropriate fiscal 
year and climate zone to calculate the maximum allowable Scope 1 fossil 
fuel-generated energy consumption for the building. The same estimated 
Scope 1 fossil fuel-generated energy consumption of the process load 
that is added to the maximum allowable Scope 1 fossil fuel-generated 
energy consumption of the applicable building must also be used in 
determining the Scope 1 fossil fuel-generated energy consumption of the 
proposed building.
    (2) Mixed-use buildings. For buildings that combine two or more 
building types with process loads or, alternatively, that combine one 
or more building types with process loads with one or more building 
types in Tables A-1a to A-2a or A-1b to A-2b of appendix A of this 
subpart, the maximum allowable Scope 1 fossil fuel-generated energy 
consumption of the proposed building is equal to the averaged process 
load building values determined under paragraph (d)(1) of this section 
and the applicable building type values in Tables A-1a to A-2a or A-1b 
to A-2b of appendix A of this subpart, weighted by floor area.


Sec.  433.201   Scope 1 Fossil fuel-generated energy consumption 
determination.

    (a) The fossil fuel-generated energy consumption of a proposed 
building is calculated as follows:

Equation 2: Fossil fuel-generated energy consumption = Direct Scope 1 
Fossil Fuel-Generated Consumption of Proposed Building/Floor Area

Where:

Direct Scope 1 Fossil Fuel-Generated Energy Consumption of Proposed 
Building equals the total Scope 1 fossil fuel-generated energy 
consumption of the proposed building calculated in accordance with 
the Performance Rating Method in Appendix G of ASHRAE 90.1-2019 
(incorporated by reference; see Sec.  433.3) and measured in 
thousands of British thermal units per year (kBtu/yr), except that 
this term does not include fossil fuel consumption for emergency 
electricity generation. Agencies must include all on-site fossil 
fuel use or Scope 1 emissions associated with non-emergency 
generation from backup generators (such as those for peak shaving or 
peak shifting). Any energy generation or Scope 1 emissions 
associated with biomass fuels are excluded. Any emissions associated 
with natural gas for alternatively fueled vehicles (``AFVs'') (or 
any other alternative fuel defined at 42 U.S.C. 13211 that is 
provided at a Federal

[[Page 78424]]

building) is excluded. Buildings with manufacturing or industrial 
process loads should be accounted for in the analysis for the 
building's fossil fuel consumption and GHG emissions but are not 
subject to the phase down targets.

    Floor Area is the area enclosed by the exterior walls of a 
building, both finished and unfinished, including indoor parking 
facilities, basements, hallways, lobbies, stairways, and elevator 
shafts.


Sec.  433.202   Petition for downward adjustment.

    (a) New Federal buildings and major renovations of all Scope 1 
fossil fuel-using systems in an EISA-subject building. (1) Upon 
petition by a Federal agency the Director of FEMP may adjust the 
applicable maximum allowable Scope 1 fossil fuel-generated energy 
consumption standard with respect to a specific building, upon written 
certification from the head of the agency designing the building, that 
the requested adjustment is the largest feasible reduction in Scope 1 
fossil fuel energy consumption that can practicably be achieved in 
light of the specified functional needs for that building, as 
demonstrated by:
    (i) A statement sealed by the design engineer that the proposed 
building was designed in accordance with the applicable energy 
efficiency requirement to the maximum extent practicable and that each 
fossil fuel consuming product included in the proposed building that is 
of a product category covered by the ENERGY STAR program or FEMP for 
designated products is an ENERGY STAR product or a product meeting the 
FEMP designation criteria, as applicable;
    (ii) A description of the systems, technologies, and practices that 
were evaluated and unable to meet the required fossil fuel reduction 
including a justification of why achieving the Scope 1 fossil fuel-
generated energy consumption targets would be technically 
impracticable: and
    (iii) Any other information the agency determines would help 
explain its request;
    (2) The head of the agency designing the building, must also 
include the following information in the petition:
    (i) A general description of the building, including but not 
limited to location, use type, floor area, stories, expected number of 
occupants and occupant schedule, project type, project cost, and 
functional needs, mission critical activity, research, and national 
security operations as applicable;
    (ii) The maximum allowable Scope 1 fossil fuel energy consumption 
for the building from Sec.  433.200(c) or (d);
    (iii) The estimated Scope 1 fossil fuel energy consumption of the 
proposed building;
    (iv) A description of the proposed building's energy-related 
features, including but not limited to:
    (A) HVAC system type and configuration;
    (B) HVAC equipment sizes and efficiencies;
    (C) Ventilation systems (including outdoor air volume, controls 
technique, heat recovery systems, and economizers, if applicable);
    (D) Service water heating system configuration and equipment 
(including solar hot water, wastewater heat recovery, and controls for 
circulating hot water systems, if applicable);
    (E) Estimated industrial process loads; and
    (F) Any other on-site fossil fuel consuming equipment.
    (3) Petitions for downward adjustment should be submitted to [email protected], or to: U.S. Department of Energy, FEMP, Director, 
Fossil Fuel Reduction Petitions, EE-5F, 1000 Independence Ave. SW, 
Washington, DC 20585-0121.
    (4) The Director of FEMP will make a best effort to notify the 
requesting agency in writing whether the petition for downward 
adjustment to the numeric reduction requirement is approved or 
rejected, in 45 calendar days of submittal, provided that the petition 
is complete. If the Director rejects the petition or establishes a 
value other than that presented in the petition, the Director will 
forward its reasons for rejection to the petitioning agency.
    (b) Major renovations of a Scope 1 fossil fuel-using building 
system or Scope 1 fossil fuel-using component. (1) Upon petition by a 
Federal agency, the Director of FEMP may adjust the applicable 
requirements for the Federal agency to reduce Scope 1 on-site fossil 
fuel-generated energy consumption standard with respect to a specific 
renovation, upon written certification from the head of the agency 
designing the renovation, that the requested adjustment is the largest 
feasible reduction in Scope 1 fossil fuel energy consumption that can 
practicably be achieved in light of the specified functional needs for 
that building, as demonstrated by:
    (i) A statement Sealed by the design engineer that the proposed 
renovation incorporates commercially available systems and/or 
components that provide a level of energy efficiency that is life-cycle 
cost effective as defined in this part and reduces consumption of Scope 
1 fossil fuel energy to the maximum extent practicable and that each 
fossil fuel consuming product included in the proposed building that is 
of a product category covered by the ENERGY STAR program or FEMP for 
designated products is an ENERGY STAR product or a product meeting the 
FEMP designation criteria, as applicable.
    (ii) A description of the systems, technologies, and practices that 
were evaluated and unable to meet the required fossil fuel reduction 
including a justification of why achieving the Scope 1 fossil fuel-
generated energy consumption targets would be technically 
impracticable: and
    (iii) Any other information the agency determines would help 
explain its request.
    (2) The head of the agency making the design decisions for the 
building, must also include the following information in the petition:
    (i) A general description of the building, including but not 
limited to location, use type, floor area, stories, estimated number of 
occupants and occupant schedule, project type, project cost, and 
functional needs, mission critical activity, research, and national 
security operations, as applicable;
    (ii) The maximum allowable Scope 1 fossil fuel energy consumption 
for the building from Sec.  433.200(c) or (d);
    (iii) The estimated Scope 1 fossil fuel energy consumption of the 
building;
    (iv) A description of system(s) or component(s) that are being 
renovated, including but not limited to:
    (A) HVAC system or component type and configuration;
    (B) HVAC equipment sizes and efficiencies;
    (C) Ventilation systems or components (including outdoor air 
volume, controls technique, heat recovery systems, and economizers, if 
applicable);
    (D) Service water heating system or component configuration and 
equipment (including solar hot water, wastewater heat recovery, and 
controls for circulating hot water systems, if applicable);
    (E) Estimated process loads; and
    (F) Any other on-site fossil fuel consuming equipment.
    (3) Petitions for downward adjustment should be submitted to [email protected], or to: U.S. Department of Energy, FEMP, Director, 
Fossil Fuel Reduction Petitions, EE-5F, 1000 Independence Ave. SW, 
Washington, DC 20585-0121.
    (4) The Director will make a best effort to notify the requesting 
agency in writing whether the petition for downward adjustment to the 
numeric reduction requirement is approved or

[[Page 78425]]

rejected, in 45 calendar days of submittal for major renovations of a 
buildings system, and 20 calendar days for major renovations of a 
component, granted the petition is complete. If the Director rejects 
the petition, the Director will forward its reasons for rejection to 
the petitioning agency.
    (c) Exclusions. The General Services Administration (GSA) may not 
submit petitions under paragraphs (a) and (b) of this section. Agencies 
that are tenants of GSA buildings for which the agency, not GSA, has 
significant design control may submit petitions in accordance with this 
section.

Appendix A to Subpart B of Part 433--Maximum Allowable Fossil Fuel-
Generated Energy Consumption

    (a) For purposes of the tables in this appendix, the climate 
zones for each county in the United States are those listed in 
Normative Appendix B Building Envelope Climate Criteria, Table B-1 
U.S. Climate Zones, ASHRAE 90.1-2019 (incorporated by reference; see 
Sec.  433.3).
    (b) For purpose of appendix A, the following definitions apply:
    Education means a category of buildings used for academic or 
technical classroom instruction, such as elementary, middle, or high 
schools, and classroom buildings on college or university campuses. 
Buildings on education campuses for which the main use is not as a 
classroom are included in the category relating to their use. For 
example, administration buildings are part of ``Office,'' 
dormitories are ``Lodging,'' and libraries are ``Public Assembly.''
    Food sales means a category of buildings used for retail or 
wholesale of food. For example, grocery stores are ``Food Sales.''
    Food service means a category of buildings used for preparation 
and sale of food and beverages for consumption. For example, 
restaurants are ``Food Service.''
    Health care (Inpatient) means a category of buildings used as 
diagnostic and treatment facilities for inpatient care.
    Health care (Outpatient) means a category of buildings used as 
diagnostic and treatment facilities for outpatient care. Medical 
offices are included here if they use any type of diagnostic medical 
equipment (if they do not, they are categorized as an office 
building).
    Laboratory means a category of buildings equipped for scientific 
experimentation or research as well as other technical, analytical, 
and administrative activities.
    Lodging means a category of buildings used to offer multiple 
accommodations for short-term or long-term residents, including 
skilled nursing and other residential care buildings.
    Mercantile (Enclosed and Strip Malls) means a category of 
shopping malls comprised of multiple connected establishments.
    Multi-Family High-Rise Residential Buildings means a category of 
residential buildings that contain 3 or more dwelling units and that 
is designed to be 4 or more stories above grade.
    Office means a category of buildings used for general office 
space, professional office, or administrative offices. Medical 
offices are included here if they do not use any type of diagnostic 
medical equipment (if they do, they are categorized as an outpatient 
health care building).
    Public assembly means a category of public or private buildings, 
or spaces therein, in which people gather for social or recreational 
activities.
    Public order and safety means a category of buildings used for 
the preservation of law and order or public safety.
    Religious worship means a category of buildings in which people 
gather for religious activities, (such as chapels, churches, 
mosques, synagogues, and temples).
    Retail (Other Than Mall) means a category of buildings used for 
the sale and display of goods other than food.
    Service means a category of buildings in which some type of 
service is provided, other than food service or retail sales of 
goods.
    Warehouse and storage means a category of buildings used to 
store goods, manufactured products, merchandise, raw materials, or 
personal belongings (such as self-storage).

[[Page 78426]]



   Table A-1a--FY2020-FY2024 Maximum Allowable Fossil Fuel-Generated Energy Consumption by Building Category, Building Type and Climate Zone, Commercial Buildings and Multi-Family High-Rise
                                                                                      Residential Buildings
                                                                                         [CO2e/yr-sqft]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
        Building category            Climate zone:       0A     0B     1A     1B     2A     2B     3A     3B     3C     4A     4B     4C     5A     5B     5C     6A     6B       7         8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                  Building type......                             Fossil fuel-generated energy use intensity (CO2e/yr-sqft)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Education.......................  College/university.   0.21   0.22   0.23   0.28   0.35   0.33   0.47   0.42   0.47   0.61   0.59   0.60   0.76   0.72   0.64   0.89   0.89      1.04      1.39
Education.......................  Elementary/middle     0.33   0.34   0.36   0.44   0.54   0.51   0.73   0.65   0.73   0.95   0.92   0.94   1.19   1.13   1.01   1.38   1.39      1.63      2.17
                                   school.
Education.......................  High school........   0.02   0.02   0.06   0.17   0.34   0.29   0.62   0.50   0.62   0.96   0.90   0.94   1.33   1.22   1.04   1.62   1.63      1.99      2.82
Education.......................  Other classroom       0.13   0.13   0.14   0.16   0.20   0.19   0.27   0.25   0.27   0.36   0.35   0.35   0.45   0.42   0.38   0.52   0.52      0.61      0.82
                                   education.
Education.......................  Preschool/daycare..   0.30   0.31   0.33   0.40   0.49   0.46   0.66   0.59   0.66   0.87   0.83   0.85   1.08   1.02   0.92   1.26   1.26      1.48      1.97
Enclosed Mall...................  Enclosed mall......   0.35   0.35   0.38   0.46   0.57   0.54   0.76   0.68   0.76   1.00   0.96   0.99   1.25   1.18   1.06   1.45   1.46      1.71      2.27
Food Sales......................  Convenience store..   0.33   0.34   0.36   0.43   0.54   0.51   0.73   0.65   0.73   0.95   0.91   0.94   1.19   1.12   1.00   1.38   1.39      1.62      2.16
Food Sales......................  Convenience store     0.24   0.24   0.26   0.31   0.39   0.36   0.52   0.46   0.52   0.68   0.65   0.67   0.85   0.80   0.72   0.98   0.99      1.16      1.54
                                   with gas station.
Food Sales......................  Grocery store/food    0.35   0.36   0.38   0.46   0.58   0.54   0.77   0.69   0.78   1.01   0.97   1.00   1.27   1.20   1.07   1.47   1.48      1.73      2.30
                                   market.
Food Sales......................  Other food sales...   1.09   1.11   1.18   1.43   1.78   1.68   2.38   2.13   2.39   3.12   3.00   3.08   3.91   3.69   3.30   4.54   4.56      5.33      7.11
Food Service....................  Fast food..........   2.06   2.09   2.23   2.70   3.37   3.16   4.50   4.02   4.51   5.90   5.67   5.82   7.39   6.97   6.24   8.56   8.60     10.06     13.41
Food Service....................  Other food service.   0.27   0.27   0.29   0.35   0.44   0.41   0.59   0.52   0.59   0.77   0.74   0.76   0.96   0.91   0.81   1.11   1.12      1.31      1.74
Food Service....................  Restaurant/           1.47   1.49   1.59   1.92   2.40   2.25   3.21   2.87   3.21   4.20   4.04   4.15   5.26   4.96   4.44   6.10   6.13      7.17      9.56
                                   cafeteria.
Inpatient Health Care...........  Hospital/inpatient    1.06   1.08   1.13   1.31   1.56   1.48   1.99   1.81   2.00   2.53   2.44   2.50   3.10   2.93   2.66   3.54   3.56      4.12      5.40
                                   health.
Laboratory......................  Laboratory.........   0.79   0.80   0.85   1.03   1.28   1.21   1.72   1.53   1.72   2.25   2.16   2.22   2.82   2.66   2.38   3.26   3.28      3.83      5.11
Lodging.........................  Dormitory/            0.51   0.51   0.55   0.66   0.83   0.78   1.10   0.99   1.11   1.45   1.39   1.43   1.81   1.71   1.53   2.10   2.11      2.47      3.29
                                   fraternity/
                                   sorority.
Lodging.........................  Hotel..............   0.46   0.47   0.50   0.60   0.75   0.71   1.00   0.90   1.01   1.32   1.26   1.30   1.65   1.55   1.39   1.91   1.92      2.24      2.99
Lodging.........................  Motel or inn.......   0.60   0.61   0.65   0.78   0.98   0.92   1.31   1.17   1.31   1.71   1.65   1.69   2.14   2.02   1.81   2.49   2.50      2.92      3.90
Lodging.........................  Other lodging......   0.23   0.24   0.25   0.30   0.38   0.36   0.51   0.45   0.51   0.66   0.64   0.65   0.83   0.78   0.70   0.96   0.97      1.13      1.51
Nursing.........................  Nursing home/         0.82   0.83   0.88   1.07   1.33   1.25   1.78   1.60   1.79   2.34   2.25   2.31   2.93   2.76   2.47   3.39   3.41      3.99      5.32
                                   assisted living.
Office..........................  Administra tive/      0.30   0.31   0.33   0.39   0.49   0.46   0.66   0.59   0.66   0.86   0.83   0.85   1.08   1.02   0.91   1.25   1.26      1.47      1.96
                                   professional
                                   office.
Office..........................  Bank/other            0.18   0.19   0.20   0.24   0.30   0.28   0.40   0.36   0.40   0.53   0.50   0.52   0.66   0.62   0.56   0.76   0.77      0.90      1.19
                                   financial.
Office..........................  Government office..   0.31   0.31   0.33   0.40   0.50   0.47   0.67   0.60   0.67   0.88   0.84   0.87   1.10   1.04   0.93   1.27   1.28      1.50      2.00
Office..........................  Medical office (non-  0.34   0.35   0.37   0.45   0.56   0.52   0.74   0.66   0.74   0.97   0.94   0.96   1.22   1.15   1.03   1.41   1.42      1.66      2.21
                                   diagnostic).
Office..........................  Mixed-use office...   0.26   0.27   0.28   0.34   0.43   0.40   0.58   0.51   0.58   0.75   0.72   0.74   0.94   0.89   0.80   1.10   1.10      1.29      1.72
Office..........................  Other office.......   0.40   0.40   0.43   0.52   0.65   0.61   0.86   0.77   0.87   1.13   1.09   1.12   1.42   1.34   1.20   1.64   1.65      1.93      2.58
Outpatient Health Care..........  Clinic/other          0.25   0.25   0.27   0.33   0.41   0.38   0.55   0.49   0.55   0.71   0.69   0.71   0.90   0.84   0.76   1.04   1.04      1.22      1.63
                                   outpatient health.
Outpatient Health Care..........  Medical office        0.27   0.27   0.29   0.35   0.44   0.41   0.58   0.52   0.59   0.77   0.74   0.76   0.96   0.90   0.81   1.11   1.12      1.31      1.74
                                   (diagnostic).
Public Assembly.................  Entertainment/        0.20   0.20   0.21   0.25   0.32   0.30   0.43   0.38   0.43   0.56   0.54   0.55   0.70   0.66   0.59   0.81   0.81      0.95      1.27
                                   culture.
Public Assembly.................  Library............   0.23   0.24   0.25   0.30   0.38   0.36   0.51   0.45   0.51   0.67   0.64   0.66   0.83   0.79   0.70   0.97   0.97      1.14      1.51
Public Assembly.................  Other public          0.23   0.24   0.25   0.31   0.38   0.36   0.51   0.46   0.51   0.67   0.64   0.66   0.84   0.79   0.71   0.97   0.97      1.14      1.52
                                   assembly.
Public Assembly.................  Recreation.........   0.24   0.24   0.26   0.31   0.39   0.37   0.53   0.47   0.53   0.69   0.66   0.68   0.86   0.81   0.73   1.00   1.00      1.17      1.57
Public Assembly.................  Social/meeting.....   0.30   0.30   0.32   0.39   0.49   0.46   0.65   0.58   0.65   0.85   0.82   0.84   1.06   1.00   0.90   1.23   1.24      1.45      1.93
Public Order & Safety...........  Fire station/police   0.54   0.55   0.58   0.70   0.88   0.83   1.17   1.05   1.18   1.54   1.48   1.52   1.93   1.82   1.63   2.23   2.25      2.62      3.50
                                   station.
Public Order & Safety...........  Other public order    0.26   0.27   0.29   0.35   0.43   0.40   0.58   0.52   0.58   0.75   0.73   0.74   0.95   0.89   0.80   1.10   1.10      1.29      1.72
                                   and safety.
Religious Worship...............  Religious worship..   0.24   0.24   0.26   0.31   0.39   0.37   0.52   0.47   0.52   0.68   0.66   0.67   0.85   0.81   0.72   0.99   1.00      1.16      1.55
Retail (except malls)...........  Other retail.......   0.40   0.40   0.43   0.52   0.65   0.61   0.86   0.77   0.86   1.13   1.09   1.12   1.42   1.34   1.20   1.64   1.65      1.93      2.57
Retail (except malls)...........  Retail store.......   0.01   0.01   0.04   0.11   0.22   0.18   0.40   0.32   0.40   0.62   0.58   0.61   0.85   0.79   0.67   1.04   1.05      1.28      1.81
Retail (except malls)...........  Vehicle dealership/   0.56   0.57   0.60   0.73   0.91   0.86   1.22   1.09   1.22   1.60   1.54   1.58   2.00   1.89   1.69   2.32   2.33      2.72      3.63
                                   showroom.
Service.........................  Other service......   0.58   0.59   0.63   0.76   0.95   0.89   1.27   1.13   1.27   1.66   1.60   1.64   2.08   1.96   1.76   2.41   2.42      2.83      3.78
Service.........................  Post office/postal    0.24   0.25   0.26   0.32   0.40   0.37   0.53   0.47   0.53   0.69   0.67   0.69   0.87   0.82   0.73   1.01   1.01      1.19      1.58
                                   center.
Service.........................  Repair shop........   0.18   0.18   0.20   0.24   0.30   0.28   0.40   0.35   0.40   0.52   0.50   0.51   0.65   0.61   0.55   0.75   0.76      0.89      1.18
Service.........................  Vehicle service/      0.37   0.37   0.39   0.48   0.60   0.56   0.80   0.71   0.80   1.04   1.00   1.03   1.31   1.23   1.10   1.51   1.52      1.78      2.37
                                   repair shop.
Service.........................  Vehicle storage/      0.29   0.30   0.31   0.38   0.47   0.45   0.63   0.57   0.64   0.83   0.80   0.82   1.04   0.98   0.88   1.21   1.21      1.42      1.89
                                   maintenance.
Strip Shopping Mall.............  Strip shopping mall   0.35   0.35   0.38   0.45   0.57   0.53   0.76   0.68   0.76   0.99   0.96   0.98   1.25   1.17   1.05   1.44   1.45      1.70      2.26
Warehouse.......................  Distribution/         0.20   0.20   0.21   0.26   0.32   0.31   0.43   0.39   0.44   0.57   0.55   0.56   0.71   0.67   0.60   0.83   0.83      0.97      1.29
                                   shipping center.
Warehouse.......................  Non-refrigerated      0.19   0.19   0.20   0.25   0.31   0.29   0.41   0.37   0.41   0.54   0.52   0.53   0.68   0.64   0.57   0.78   0.79      0.92      1.23
                                   warehouse.
Warehouse.......................  Refrigerated          0.03   0.04   0.04   0.05   0.06   0.05   0.08   0.07   0.08   0.10   0.10   0.10   0.12   0.12   0.11   0.14   0.15      0.17      0.23
                                   warehouse.
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 78427]]


   Table A-1b--FY2020-FY2024 Maximum Allowable Fossil Fuel-Generated Energy Consumption by Building Category, Building Type and Climate Zone, Commercial Buildings and Multi-Family High-Rise
                                                                                      Residential Buildings
                                                                                      [Source kBtu/yr-sqft]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
         Building category                Climate zone:        0A     0B     1A     1B     2A     2B     3A     3B     3C     4A     4B     4C     5A     5B     5C     6A     6B     7      8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                     Building type.........                          Fossil fuel-generated energy use intensity (site kBtu/yr-sqft)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Education..........................  College/university....      2      2      2      3      3      3      4      4      4      6      5      5      7      7      6      8      8      9     13
Education..........................  Elementary/middle           3      3      3      4      5      5      7      6      7      9      8      9     11     10      9     13     13     15     20
                                      school.
Education..........................  High school...........      0      0      1      2      3      3      6      5      6      9      8      9     12     11      9     15     15     18     26
Education..........................  Other classroom             1      1      1      1      2      2      2      2      2      3      3      3      4      4      3      5      5      6      7
                                      education.
Education..........................  Preschool/daycare.....      3      3      3      4      4      4      6      5      6      8      8      8     10      9      8     11     11     13     18
Enclosed Mall......................  Enclosed mall.........      3      3      3      4      5      5      7      6      7      9      9      9     11     11     10     13     13     15     21
Food Sales.........................  Convenience store.....      3      3      3      4      5      5      7      6      7      9      8      9     11     10      9     13     13     15     20
Food Sales.........................  Convenience store with      2      2      2      3      4      3      5      4      5      6      6      6      8      7      7      9      9     10     14
                                      gas station.
Food Sales.........................  Grocery store/food          3      3      3      4      5      5      7      6      7      9      9      9     12     11     10     13     13     16     21
                                      market.
Food Sales.........................  Other food sales......     10     10     11     13     16     15     22     19     22     28     27     28     36     33     30     41     41     48     64
Food Service.......................  Fast food.............     19     19     20     24     31     29     41     37     41     54     51     53     67     63     57     78     78     91    122
Food Service.......................  Other food service....      2      2      3      3      4      4      5      5      5      7      7      7      9      8      7     10     10     12     16
Food Service.......................  Restaurant/cafeteria..     13     14     14     17     22     20     29     26     29     38     37     38     48     45     40     55     56     65     87
Inpatient Health Care..............  Hospital/inpatient         10     10     10     12     14     13     18     16     18     23     22     23     28     27     24     32     32     37     49
                                      health.
Laboratory.........................  Laboratory............      7      7      8      9     12     11     16     14     16     20     20     20     26     24     22     30     30     35     46
Lodging............................  Dormitory/fraternity/       5      5      5      6      7      7     10      9     10     13     13     13     16     16     14     19     19     22     30
                                      sorority.
Lodging............................  Hotel.................      4      4      5      5      7      6      9      8      9     12     11     12     15     14     13     17     17     20     27
Lodging............................  Motel or inn..........      5      6      6      7      9      8     12     11     12     16     15     15     19     18     16     23     23     27     35
Lodging............................  Other lodging.........      2      2      2      3      3      3      5      4      5      6      6      6      8      7      6      9      9     10     14
Nursing............................  Nursing home/assisted       7      8      8     10     12     11     16     14     16     21     20     21     27     25     22     31     31     36     48
                                      living.
Office.............................  Administrative/             3      3      3      4      4      4      6      5      6      8      8      8     10      9      8     11     11     13     18
                                      professional office.
Office.............................  Bank/other financial..      2      2      2      2      3      3      4      3      4      5      5      5      6      6      5      7      7      8     11
Office.............................  Government office.....      3      3      3      4      5      4      6      5      6      8      8      8     10      9      8     12     12     14     18
Office.............................  Medical office (non-        3      3      3      4      5      5      7      6      7      9      8      9     11     10      9     13     13     15     20
                                      diagnostic).
Office.............................  Mixed-use office......      2      2      3      3      4      4      5      5      5      7      7      7      9      8      7     10     10     12     16
Office.............................  Other office..........      4      4      4      5      6      6      8      7      8     10     10     10     13     12     11     15     15     18     23
Outpatient Health Care.............  Clinic/other                2      2      2      3      4      3      5      4      5      6      6      6      8      8      7      9      9     11     15
                                      outpatient health.
Outpatient Health Care.............  Medical office              2      2      3      3      4      4      5      5      5      7      7      7      9      8      7     10     10     12     16
                                      (diagnostic).
Public Assembly....................  Entertainment/culture.      2      2      2      2      3      3      4      3      4      5      5      5      6      6      5      7      7      9     11
Public Assembly....................  Library...............      2      2      2      3      3      3      5      4      5      6      6      6      8      7      6      9      9     10     14
Public Assembly....................  Other public assembly.      2      2      2      3      3      3      5      4      5      6      6      6      8      7      6      9      9     10     14
Public Assembly....................  Recreation............      2      2      2      3      4      3      5      4      5      6      6      6      8      7      7      9      9     11     14
Public Assembly....................  Social/meeting........      3      3      3      4      4      4      6      5      6      8      7      8     10      9      8     11     11     13     18
Public Order & Safety..............  Fire station/police         5      5      5      6      8      7     11     10     11     14     13     14     17     16     15     20     20     24     32
                                      station.
Public Order & Safety..............  Other public order and      2      2      3      3      4      4      5      5      5      7      7      7      9      8      7     10     10     12     16
                                      safety.
Religious Worship..................  Religious worship.....      2      2      2      3      4      3      5      4      5      6      6      6      8      7      7      9      9     11     14
Retail (except malls)..............  Other retail..........      4      4      4      5      6      6      8      7      8     10     10     10     13     12     11     15     15     17     23
Retail (except malls)..............  Retail store..........      0      0      0      1      2      2      4      3      4      6      5      5      8      7      6      9      9     12     16
Retail (except malls)..............  Vehicle dealership/         5      5      5      7      8      8     11     10     11     14     14     14     18     17     15     21     21     25     33
                                      showroom.
Service............................  Other service.........      5      5      6      7      9      8     12     10     12     15     14     15     19     18     16     22     22     26     34
Service............................  Post office/postal          2      2      2      3      4      3      5      4      5      6      6      6      8      7      7      9      9     11     14
                                      center.
Service............................  Repair shop...........      2      2      2      2      3      3      4      3      4      5      5      5      6      6      5      7      7      8     11
Service............................  Vehicle service/repair      3      3      4      4      5      5      7      6      7      9      9      9     12     11     10     14     14     16     22
                                      shop.
Service............................  Vehicle storage/            3      3      3      3      4      4      6      5      6      8      7      7      9      9      8     11     11     13     17
                                      maintenance.
Strip Shopping Mall................  Strip shopping mall...      3      3      3      4      5      5      7      6      7      9      9      9     11     11     10     13     13     15     21
Warehouse..........................  Distribution/shipping       2      2      2      2      3      3      4      4      4      5      5      5      6      6      5      7      8      9     12
                                      center.
Warehouse..........................  Non-refrigerated            2      2      2      2      3      3      4      3      4      5      5      5      6      6      5      7      7      8     11
                                      warehouse.
Warehouse..........................  Refrigerated warehouse      0      0      0      0      1      0      1      1      1      1      1      1      1      1      1      1      1      2      2
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 78428]]


   Table A-2a--FY2025-FY2029 Maximum Allowable Fossil Fuel-Generated Energy Consumption by Building Category, Building Type and Climate Zone, Commercial Buildings and Multi-Family High-Rise
                                                                                      Residential Buildings
                                                                                         [CO2e/yr-sqft]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
         Building category                Climate zone:        0A     0B     1A     1B     2A     2B     3A     3B     3C     4A     4B     4C     5A     5B     5C     6A     6B     7      8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                     Building Type.........                             Fossil fuel-generated energy use intensity (CO2e/yr-sqft)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Education..........................  College/university....   0.11   0.11   0.12   0.14   0.17   0.16   0.23   0.21   0.23   0.30   0.29   0.30   0.38   0.36   0.32   0.44   0.44   0.52   0.69
Education..........................  Elementary/middle        0.17   0.17   0.18   0.22   0.27   0.26   0.36   0.33   0.36   0.48   0.46   0.47   0.60   0.56   0.50   0.69   0.70   0.81   1.08
                                      school.
Education..........................  High school...........   0.01   0.01   0.03   0.09   0.17   0.14   0.31   0.25   0.31   0.48   0.45   0.47   0.66   0.61   0.52   0.81   0.81   0.99   1.41
Education..........................  Other classroom          0.06   0.06   0.07   0.08   0.10   0.10   0.14   0.12   0.14   0.18   0.17   0.18   0.22   0.21   0.19   0.26   0.26   0.31   0.41
                                      education.
Education..........................  Preschool/daycare.....   0.15   0.15   0.16   0.20   0.25   0.23   0.33   0.30   0.33   0.43   0.42   0.43   0.54   0.51   0.46   0.63   0.63   0.74   0.98
Enclosed Mall......................  Enclosed mall.........   0.17   0.18   0.19   0.23   0.29   0.27   0.38   0.34   0.38   0.50   0.48   0.49   0.63   0.59   0.53   0.73   0.73   0.85   1.14
Food Sales.........................  Convenience store.....   0.17   0.17   0.18   0.22   0.27   0.25   0.36   0.32   0.36   0.48   0.46   0.47   0.60   0.56   0.50   0.69   0.69   0.81   1.08
Food Sales.........................  Convenience store with   0.12   0.12   0.13   0.15   0.19   0.18   0.26   0.23   0.26   0.34   0.33   0.33   0.42   0.40   0.36   0.49   0.49   0.58   0.77
                                      gas station.
Food Sales.........................  Grocery store/food       0.18   0.18   0.19   0.23   0.29   0.27   0.39   0.35   0.39   0.51   0.49   0.50   0.63   0.60   0.54   0.74   0.74   0.86   1.15
                                      market.
Food Sales.........................  Other food sales......   0.55   0.55   0.59   0.71   0.89   0.84   1.19   1.07   1.19   1.56   1.50   1.54   1.96   1.85   1.65   2.27   2.28   2.66   3.55
Food Service.......................  Fast food.............   1.03   1.05   1.11   1.35   1.68   1.58   2.25   2.01   2.26   2.95   2.83   2.91   3.69   3.48   3.12   4.28   4.30   5.03   6.71
Food Service.......................  Other food service....   0.13   0.14   0.14   0.18   0.22   0.21   0.29   0.26   0.29   0.38   0.37   0.38   0.48   0.45   0.41   0.56   0.56   0.65   0.87
Food Service.......................  Restaurant/cafeteria..   0.74   0.75   0.79   0.96   1.20   1.13   1.60   1.43   1.61   2.10   2.02   2.07   2.63   2.48   2.22   3.05   3.06   3.58   4.78
Inpatient Health Care..............  Hospital/inpatient       0.53   0.54   0.56   0.65   0.78   0.74   1.00   0.91   1.00   1.26   1.22   1.25   1.55   1.47   1.33   1.77   1.78   2.06   2.70
                                      health.
Laboratory.........................  Laboratory............   0.39   0.40   0.42   0.51   0.64   0.60   0.86   0.77   0.86   1.12   1.08   1.11   1.41   1.33   1.19   1.63   1.64   1.92   2.56
Lodging............................  Dormitory/fraternity/    0.25   0.26   0.27   0.33   0.41   0.39   0.55   0.49   0.55   0.72   0.70   0.71   0.91   0.85   0.76   1.05   1.06   1.23   1.65
                                      sorority.
Lodging............................  Hotel.................   0.23   0.23   0.25   0.30   0.38   0.35   0.50   0.45   0.50   0.66   0.63   0.65   0.82   0.78   0.70   0.96   0.96   1.12   1.50
Lodging............................  Motel or inn..........   0.30   0.30   0.32   0.39   0.49   0.46   0.65   0.58   0.66   0.86   0.82   0.84   1.07   1.01   0.91   1.24   1.25   1.46   1.95
Lodging............................  Other lodging.........   0.12   0.12   0.13   0.15   0.19   0.18   0.25   0.23   0.25   0.33   0.32   0.33   0.42   0.39   0.35   0.48   0.48   0.57   0.75
Nursing............................  Nursing home/assisted    0.41   0.42   0.44   0.53   0.67   0.63   0.89   0.80   0.89   1.17   1.12   1.15   1.46   1.38   1.24   1.70   1.71   1.99   2.66
                                      living.
Office.............................  Administrative/          0.15   0.15   0.16   0.20   0.25   0.23   0.33   0.29   0.33   0.43   0.41   0.43   0.54   0.51   0.46   0.63   0.63   0.74   0.98
                                      professional office.
Office.............................  Bank/other financial..   0.09   0.09   0.10   0.12   0.15   0.14   0.20   0.18   0.20   0.26   0.25   0.26   0.33   0.31   0.28   0.38   0.38   0.45   0.60
Office.............................  Government office.....   0.15   0.16   0.17   0.20   0.25   0.24   0.33   0.30   0.34   0.44   0.42   0.43   0.55   0.52   0.46   0.64   0.64   0.75   1.00
Office.............................  Medical office (non-     0.17   0.17   0.18   0.22   0.28   0.26   0.37   0.33   0.37   0.49   0.47   0.48   0.61   0.58   0.51   0.71   0.71   0.83   1.11
                                      diagnostic).
Office.............................  Mixed-use office......   0.13   0.13   0.14   0.17   0.22   0.20   0.29   0.26   0.29   0.38   0.36   0.37   0.47   0.45   0.40   0.55   0.55   0.64   0.86
Office.............................  Other office..........   0.20   0.20   0.21   0.26   0.32   0.30   0.43   0.39   0.43   0.57   0.54   0.56   0.71   0.67   0.60   0.82   0.83   0.97   1.29
Outpatient Health Care.............  Clinic/other             0.13   0.13   0.13   0.16   0.20   0.19   0.27   0.24   0.27   0.36   0.34   0.35   0.45   0.42   0.38   0.52   0.52   0.61   0.81
                                      outpatient health.
Outpatient Health Care.............  Medical office           0.13   0.14   0.14   0.18   0.22   0.21   0.29   0.26   0.29   0.38   0.37   0.38   0.48   0.45   0.41   0.56   0.56   0.65   0.87
                                      (diagnostic).
Public Assembly....................  Entertainment/culture.   0.10   0.10   0.11   0.13   0.16   0.15   0.21   0.19   0.21   0.28   0.27   0.27   0.35   0.33   0.29   0.40   0.41   0.48   0.63
Public Assembly....................  Library...............   0.12   0.12   0.13   0.15   0.19   0.18   0.25   0.23   0.25   0.33   0.32   0.33   0.42   0.39   0.35   0.48   0.49   0.57   0.76
Public Assembly....................  Other public assembly.   0.12   0.12   0.13   0.15   0.19   0.18   0.25   0.23   0.26   0.33   0.32   0.33   0.42   0.39   0.35   0.49   0.49   0.57   0.76
Public Assembly....................  Recreation............   0.12   0.12   0.13   0.16   0.20   0.18   0.26   0.23   0.26   0.34   0.33   0.34   0.43   0.41   0.36   0.50   0.50   0.59   0.78
Public Assembly....................  Social/meeting........   0.15   0.15   0.16   0.19   0.24   0.23   0.32   0.29   0.33   0.42   0.41   0.42   0.53   0.50   0.45   0.62   0.62   0.72   0.97
Public Order & Safety..............  Fire station/police      0.27   0.27   0.29   0.35   0.44   0.41   0.59   0.53   0.59   0.77   0.74   0.76   0.96   0.91   0.81   1.12   1.12   1.31   1.75
                                      station.
Public Order & Safety..............  Other public order and   0.13   0.13   0.14   0.17   0.22   0.20   0.29   0.26   0.29   0.38   0.36   0.37   0.47   0.45   0.40   0.55   0.55   0.64   0.86
                                      safety.
Religious Worship..................  Religious worship.....   0.12   0.12   0.13   0.16   0.19   0.18   0.26   0.23   0.26   0.34   0.33   0.34   0.43   0.40   0.36   0.50   0.50   0.58   0.78
Retail (except malls)..............  Other retail..........   0.20   0.20   0.21   0.26   0.32   0.30   0.43   0.39   0.43   0.57   0.54   0.56   0.71   0.67   0.60   0.82   0.82   0.96   1.29
Retail (except malls)..............  Retail store..........   0.01   0.01   0.02   0.06   0.11   0.09   0.20   0.16   0.20   0.31   0.29   0.30   0.43   0.39   0.34   0.52   0.52   0.64   0.90
Retail (except malls)..............  Vehicle dealership/      0.28   0.28   0.30   0.37   0.46   0.43   0.61   0.55   0.61   0.80   0.77   0.79   1.00   0.94   0.84   1.16   1.17   1.36   1.82
                                      showroom.
Service............................  Other service.........   0.29   0.29   0.31   0.38   0.47   0.45   0.63   0.57   0.64   0.83   0.80   0.82   1.04   0.98   0.88   1.21   1.21   1.42   1.89
Service............................  Post office/postal       0.12   0.12   0.13   0.16   0.20   0.19   0.27   0.24   0.27   0.35   0.33   0.34   0.44   0.41   0.37   0.50   0.51   0.59   0.79
                                      center.
Service............................  Repair shop...........   0.09   0.09   0.10   0.12   0.15   0.14   0.20   0.18   0.20   0.26   0.25   0.26   0.33   0.31   0.27   0.38   0.38   0.44   0.59
Service............................  Vehicle service/repair   0.18   0.19   0.20   0.24   0.30   0.28   0.40   0.36   0.40   0.52   0.50   0.51   0.65   0.62   0.55   0.76   0.76   0.89   1.19
                                      shop.
Service............................  Vehicle storage/         0.15   0.15   0.16   0.19   0.24   0.22   0.32   0.28   0.32   0.42   0.40   0.41   0.52   0.49   0.44   0.60   0.61   0.71   0.95
                                      maintenance.
Strip Shopping Mall................  Strip shopping mall...   0.17   0.18   0.19   0.23   0.28   0.27   0.38   0.34   0.38   0.50   0.48   0.49   0.62   0.59   0.53   0.72   0.73   0.85   1.13
Warehouse..........................  Distribution/shipping    0.10   0.10   0.11   0.13   0.16   0.15   0.22   0.19   0.22   0.28   0.27   0.28   0.36   0.34   0.30   0.41   0.41   0.49   0.65
                                      center.
Warehouse..........................  Non-refrigerated         0.09   0.10   0.10   0.12   0.15   0.14   0.21   0.18   0.21   0.27   0.26   0.27   0.34   0.32   0.29   0.39   0.39   0.46   0.61
                                      warehouse.
Warehouse..........................  Refrigerated warehouse   0.02   0.02   0.02   0.02   0.03   0.03   0.04   0.03   0.04   0.05   0.05   0.05   0.06   0.06   0.05   0.07   0.07   0.08   0.11
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 78429]]


   Table A-2b--FY2025-FY2029 Maximum Allowable Fossil Fuel-Generated Energy Consumption by Building Category, Building Type and Climate Zone, Commercial Buildings and Multi-Family High-Rise
                                                                                      Residential Buildings
                                                                                       [Site kBtu/yr-sqft]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
         Building category                Climate zone:        0A     0B     1A     1B     2A     2B     3A     3B     3C     4A     4B     4C     5A     5B     5C     6A     6B     7      8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                     Building Type.........                          Fossil fuel-generated energy use intensity (site kBtu/yr-sqft)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Education..........................  College/university....      1      1      1      1      2      1      2      2      2      3      3      3      3      3      3      4      4      5      6
Education..........................  Elementary/middle           2      2      2      2      2      2      3      3      3      4      4      4      5      5      5      6      6      7     10
                                      school.
Education..........................  High school...........      0      0      0      1      2      1      3      2      3      4      4      4      6      6      5      7      7      9     13
Education..........................  Other classroom             1      1      1      1      1      1      1      1      1      2      2      2      2      2      2      2      2      3      4
                                      education.
Education..........................  Preschool/daycare.....      1      1      1      2      2      2      3      3      3      4      4      4      5      5      4      6      6      7      9
Enclosed Mall......................  Enclosed mall.........      2      2      2      2      3      2      3      3      3      5      4      4      6      5      5      7      7      8     10
Food Sales.........................  Convenience store.....      2      2      2      2      2      2      3      3      3      4      4      4      5      5      5      6      6      7     10
Food Sales.........................  Convenience store with      1      1      1      1      2      2      2      2      2      3      3      3      4      4      3      4      4      5      7
                                      gas station.
Food Sales.........................  Grocery store/food          2      2      2      2      3      2      4      3      4      5      4      5      6      5      5      7      7      8     10
                                      market.
Food Sales.........................  Other food sales......      5      5      5      6      8      8     11     10     11     14     14     14     18     17     15     21     21     24     32
Food Service.......................  Fast food.............      9      9     10     12     15     14     20     18     20     27     26     26     34     32     28     39     39     46     61
Food Service.......................  Other food service....      1      1      1      2      2      2      3      2      3      3      3      3      4      4      4      5      5      6      8
Food Service.......................  Restaurant/cafeteria..      7      7      7      9     11     10     15     13     15     19     18     19     24     23     20     28     28     33     43
Inpatient Health Care..............  Hospital/inpatient          5      5      5      6      7      7      9      8      9     11     11     11     14     13     12     16     16     19     24
                                      health.
Laboratory.........................  Laboratory............      4      4      4      5      6      5      8      7      8     10     10     10     13     12     11     15     15     17     23
Lodging............................  Dormitory/fraternity/       2      2      2      3      4      4      5      4      5      7      6      6      8      8      7     10     10     11     15
                                      sorority.
Lodging............................  Hotel.................      2      2      2      3      3      3      5      4      5      6      6      6      7      7      6      9      9     10     14
Lodging............................  Motel or inn..........      3      3      3      4      4      4      6      5      6      8      7      8     10      9      8     11     11     13     18
Lodging............................  Other lodging.........      1      1      1      1      2      2      2      2      2      3      3      3      4      4      3      4      4      5      7
Nursing............................  Nursing home/assisted       4      4      4      5      6      6      8      7      8     11     10     10     13     13     11     15     15     18     24
                                      living.
Office.............................  Administrative/             1      1      1      2      2      2      3      3      3      4      4      4      5      5      4      6      6      7      9
                                      professional office.
Office.............................  Bank/other financial..      1      1      1      1      1      1      2      2      2      2      2      2      3      3      3      3      3      4      5
Office.............................  Government office.....      1      1      2      2      2      2      3      3      3      4      4      4      5      5      4      6      6      7      9
Office.............................  Medical office (non-        2      2      2      2      3      2      3      3      3      4      4      4      6      5      5      6      6      8     10
                                      diagnostic).
Office.............................  Mixed-use office......      1      1      1      2      2      2      3      2      3      3      3      3      4      4      4      5      5      6      8
Office.............................  Other office..........      2      2      2      2      3      3      4      4      4      5      5      5      6      6      5      7      7      9     12
Outpatient Health Care.............  Clinic/other                1      1      1      1      2      2      2      2      2      3      3      3      4      4      3      5      5      6      7
                                      outpatient health.
Outpatient Health Care.............  Medical office              1      1      1      2      2      2      3      2      3      3      3      3      4      4      4      5      5      6      8
                                      (diagnostic).
Public Assembly....................  Entertainment/culture.      1      1      1      1      1      1      2      2      2      3      2      2      3      3      3      4      4      4      6
Public Assembly....................  Library...............      1      1      1      1      2      2      2      2      2      3      3      3      4      4      3      4      4      5      7
Public Assembly....................  Other public assembly.      1      1      1      1      2      2      2      2      2      3      3      3      4      4      3      4      4      5      7
Public Assembly....................  Recreation............      1      1      1      1      2      2      2      2      2      3      3      3      4      4      3      5      5      5      7
Public Assembly....................  Social/meeting........      1      1      1      2      2      2      3      3      3      4      4      4      5      5      4      6      6      7      9
Public Order & Safety..............  Fire station/police         2      2      3      3      4      4      5      5      5      7      7      7      9      8      7     10     10     12     16
                                      station.
Public Order & Safety..............  Other public order and      1      1      1      2      2      2      3      2      3      3      3      3      4      4      4      5      5      6      8
                                      safety.
Religious Worship..................  Religious worship.....      1      1      1      1      2      2      2      2      2      3      3      3      4      4      3      4      5      5      7
Retail (except malls)..............  Other retail..........      2      2      2      2      3      3      4      3      4      5      5      5      6      6      5      7      7      9     12
Retail (except malls)..............  Retail store..........      0      0      0      1      1      1      2      1      2      3      3      3      4      4      3      5      5      6      8
Retail (except malls)..............  Vehicle dealership/         3      3      3      3      4      4      6      5      6      7      7      7      9      9      8     11     11     12     16
                                      showroom.
Service............................  Other service.........      3      3      3      3      4      4      6      5      6      8      7      7      9      9      8     11     11     13     17
Service............................  Post office/postal          1      1      1      1      2      2      2      2      2      3      3      3      4      4      3      5      5      5      7
                                      center.
Service............................  Repair shop...........      1      1      1      1      1      1      2      2      2      2      2      2      3      3      2      3      3      4      5
Service............................  Vehicle service/repair      2      2      2      2      3      3      4      3      4      5      5      5      6      6      5      7      7      8     11
                                      shop.
Service............................  Vehicle storage/            1      1      1      2      2      2      3      3      3      4      4      4      5      4      4      5      6      6      9
                                      maintenance.
Strip Shopping Mall................  Strip shopping mall...      2      2      2      2      3      2      3      3      3      5      4      4      6      5      5      7      7      8     10
Warehouse..........................  Distribution/shipping       1      1      1      1      1      1      2      2      2      3      2      3      3      3      3      4      4      4      6
                                      center.
Warehouse..........................  Non-refrigerated            1      1      1      1      1      1      2      2      2      2      2      2      3      3      3      4      4      4      6
                                      warehouse.
Warehouse..........................  Refrigerated warehouse      0      0      0      0      0      0      0      0      0      0      0      0      1      1      0      1      1      1      1
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 78430]]

PART 435--ENERGY EFFICIENCY STANDARDS FOR THE DESIGN AND 
CONSTRUCTION OF NEW FEDERAL LOW-RISE RESIDENTIAL BUILDINGS

0
6. The authority citation for part 435 continues to read as follows:

    Authority:  42 U.S.C. 6831-6832; 6834-6836; 42 U.S.C. 8253-54; 
42 U.S.C. 7101 et seq.

0
7. Amend Sec.  435.1, by adding paragraph (b) to read as follows:


Sec.  435.1   Purpose and scope.

* * * * *
    (b) This part also establishes a maximum allowable fossil fuel-
generated energy consumption standard for new Federal buildings that 
are low-rise residential buildings and major renovations to Federal 
buildings that are low-rise residential buildings, for which design for 
construction began on or after December 21, 2023.
* * * * *
0
8. Amend Sec.  435.2 by:
0
a. Adding in alphabetical order, the definitions of ``Construction 
cost,'' ``Design for renovation'', ``EISA-subject building or 
project'', ``Federal building,'' ``Fiscal year (FY),'' ``Major 
renovation,'' ``Major renovation cost,'' ``Major renovation of all 
Scope fossil fuel-using systems in a building,'' and ``Major renovation 
of a Scope 1 fossil fuel-using building system or Scope 1 fossil fuel-
using component'';
0
b. Revising the definitions of ``Proposed building''; and
0
c. Adding in alphabetical order, the definitions of ``Scope 1 fossil 
fuel-generated energy consumption'' and ``Shift adjustment multiplier'' 
and ``Technical impracticability''.
    The additions and revision read as follows:


Sec.  435.2   Definitions.

* * * * *
    Construction cost means all costs associated with design and 
construction of a Federal building. It includes the cost of design, 
permitting, construction (materials and labor), and building 
commissioning. It does not include legal or administrative fees, or the 
cost of acquiring the land.
* * * * *
    Design for renovation means the stage when the energy efficiency 
and sustainability details (such as insulation levels, HVAC systems, 
water-using systems, etc.) are either explicitly determined or 
implicitly included in a renovation project cost specification.
* * * * *
    EISA-subject building or project means, for purposes of this rule, 
any new building or renovation project that is subject to the cost 
thresholds and reporting requirements in Section 433 of EISA 2007 ((42 
U.S.C. 6834(a)(3)(D)(i))). The cost threshold referenced in Section 433 
of EISA is $2.5 million in 2007 dollars. GSA provides a table of annual 
updates to this cost threshold at https://www.gsa.gov/real-estate/design-and-construction/annual-prospectus-thresholds. GSA also provides 
a second cost threshold for renovations of leased buildings that is \1/
2\ of the cost threshold for renovation of Federally owned buildings.
* * * * *
    Federal building as defined in 42 U.S.C. 6832 means any building to 
be constructed by, or for the use of, any Federal agency. Such term 
shall include buildings built for the purpose of being leased by a 
Federal agency, and privatized military housing.
    Fiscal Year (FY) begins on October 1 of the year prior to the 
specified calendar year and ends on September 30 of the specified 
calendar year.
* * * * *
    Major renovation means either major renovation of all Scope 1 
fossil fuel-generated/consuming systems in a building or major 
renovation of one or more Scope 1 fossil fuel-using building systems or 
components, as defined in this section.
    Major renovation cost means:
    (1) Preliminary planning, engineering, architectural, legal, 
fiscal, and economic investigations and studies, surveys, designs, 
plans, working drawings, specifications, procedures, and other similar 
actions necessary for the alteration of a public building; and (2) 
Repairing, remodeling, improving, or extending, or other changes in, a 
public building as per 40 U.S.C. 3301(a)(1).
    Major renovation of all Scope 1 fossil fuel-using systems in a 
building means construction on an existing building that is so 
extensive that it replaces all Scope 1 fossil fuel-using systems in the 
building. This term includes, but is not limited to, comprehensive 
replacement or restoration of most or all major systems, interior work 
(such as ceilings, partitions, doors, floor finishes, etc.), or 
building elements and features.
    Major renovation of a Scope 1 fossil fuel-using building system or 
Scope 1 fossil fuel-using component means changes to a building that 
provide significant opportunities for energy efficiency or reduction in 
fossil fuel-related energy consumption. This includes, but is not 
limited to, replacement of the HVAC system, hot water system, or 
cooking system, or other fossil fuel-using systems or components of the 
building that have a major impact on fossil fuel usage.
* * * * *
    Proposed building means the design for construction of a new 
Federal low-rise residential building, or major renovation to a Federal 
low-rise residential building, proposed for construction.
    Scope 1 fossil fuel-generated energy consumption means, for 
purposes of this rule, the on-site stationary combustion of fossil 
fuels that contribute to Scope 1 emissions for generation of 
electricity, heat, cooling, or steam as defined by ``Federal Greenhouse 
Gas Accounting and Reporting Guidance'' (Council on Environmental 
Quality, January 17, 2016). Emissions that result from combustion of 
fuels in stationary sources (e.g., boilers, furnaces, turbines, and 
emergency generators). This term does not include mobile sources, 
fugitive emissions, or process emissions as defined by ``Federal 
Greenhouse Gas Accounting and Reporting Guidance'' (Council on 
Environmental Quality, January 17, 2016).
    Shift adjustment multiplier means that agencies can apply a 
multiplication factor to their Maximum Allowable Fossil Fuel-Generated 
Energy Consumption by Building Category target based upon the weekly 
hours of active operation of the building. The weekly hours of 
operation to use as a basis for the shift adjustment multiplier lookup 
should be based upon the time in which in the building is actively 
occupied and operating per its intended use type and should include 
unoccupied hours or other times of limited use (such as night-time 
setback hours).
    Technical impracticability means achieving the Scope 1 fossil fuel-
generated energy consumption targets would--
    (1) Not be feasible from an engineering design or execution 
standpoint due to existing physical or site constraints that prohibit 
modification or addition of elements or spaces,
    (2) Significantly obstruct building operations and the functional 
needs of a building, specifically for industrial process loads, 
critical national security functions, mission critical information 
systems as defined in NIST SP 800-60 Vol. 2 Rev. 1, and research 
operations, or
    (3) Significantly degrade energy resiliency and energy security of 
building operations as defined in 10 U.S.C. 101(e)(6) and 10 U.S.C. 
101(e)(7) respectively. Upon determination that

[[Page 78431]]

complying with the Clean Energy Rule is technically impracticable, the 
building is still required to reduce fossil fuel consumption to the 
maximum extent practicable. Technical impracticability may include 
technology availability and cost considerations but may not be based 
solely on cost considerations.
0
9. Amend Sec.  435.3 by revising paragraph (b)(4) to read as follows:


Sec.  435.3   Materials incorporated by reference.

* * * * *
    (b) * * *
    (4) ICC 2021 International Energy Conservation Code (IECC), Redline 
Version, Copyright 2021, (``IECC 2021''), IBR approved for Sec. Sec.  
435.2, 435.5, 435.201, and appendix A to this subpart.
0
10. Section 435.4 is revised to read as follows:


Sec.  435.4   Life-cycle cost-effective.

    Except as specified in subparts A, B or C of this part, Federal 
agencies shall determine life-cycle cost-effectiveness by using the 
procedures set out in subpart A of 10 CFR part 436. A Federal agency 
may choose to use any of four methods, including life-cycle cost, net 
savings, savings-to-investment ratio, and adjusted internal rate of 
return using the discount rate published in the annual supplement to 
the Life Cycle Costing Manual for the FEMP (NIST 85-3273).
0
11. Subpart B is added to part 435 to read as follows:

Subpart B--Reduction in Scope 1 Fossil Fuel-Generated Energy 
Consumption

Sec.
435.200 Scope 1 Fossil fuel-generated energy consumption 
requirement.
435.201 Scope 1 Fossil fuel-generated energy consumption 
determination.
435.202 Petition for downward adjustment.
Appendix A to Subpart B of Part 435--Maximum Allowable Scope 1 
Fossil Fuel-Generated Energy Consumption


Sec.  435.200   Scope 1 Fossil fuel-generated energy consumption 
requirement.

    (a) New EISA-Subject buildings. (1) New Federal buildings that are 
low-rise residential buildings, for which design for construction began 
on or after [Date one year after date of publication in the Federal 
Register], must be designed to meet the requirements of paragraph (c) 
of this section if the cost of the building is at least $2,500,000 (in 
2007 dollars, adjusted for inflation). See GSA Annual Prospectus 
Thresholds at www.gsa.gov/real-estate/design-construction/gsa-annual-prospectus-thresholds.
    (b) Major renovations of EISA-Subject buildings. (1) Major 
renovations to Federal buildings that are low-rise residential 
buildings, for which design for construction began on or after [Date 
one year after date of publication in the Federal Register], must be 
designed to meet the requirements of paragraph (c) of this section if 
the cost of the major renovation is at least $2,500,000 (in 2007 
dollars, adjusted for inflation).
    (2) This subpart applies only to the portions of the proposed 
building or proposed building systems that are being renovated and to 
the extent that the scope of the renovation permits compliance with the 
applicable requirements in this subpart. Unaltered portions of the 
proposed building or proposed building systems are not required to 
comply with this subpart.
    (3) For leased buildings, this subpart applies to major renovations 
only if the proposed building was originally built for the use of any 
Federal agency, including being leased by a Federal agency.
    (c) Federal buildings that are of the type included in Appendix A 
of this subpart--(1) New Construction and Major Renovations of all 
Scope 1 Fossil Fuel-Using Systems in an EISA-Subject Building.
    (i) Design for construction began during fiscal year 2024 through 
fiscal year 2029. For new construction or major renovations of all 
fossil fuel-using systems in an EISA-subject building, for which design 
for construction or renovation, as applicable, began during fiscal year 
2024 through 2029, the Scope 1 fossil fuel-generated energy consumption 
of the proposed building, based on the building design and calculated 
according to Sec.  435.201(a), must not exceed the value identified in 
Tables A-1a to A-2a (if targets based on Scope 1 emissions are used) or 
Tables A-1b to A-2b (if targets based on kBtu of fossil fuel usage are 
used) of Appendix A of this subpart for the associated building type, 
climate zone, and fiscal year in which design for construction began.
    (A) Federal agencies may apply a shift adjustment multiplier to the 
values in Tables A-1a to A-2a or Tables A-1b to A-2b based on the 
following baseline hours of operation assumed in Tables A-1a to A-2a or 
Tables A-1b to A-2b.
    (B) To calculate the shift adjustment multiplier, agencies shall 
estimate the number of shifts for their new building and multiply by 
the appropriate factor shown below in Table 1 for their building type. 
The Scope 1 fossil fuel-generated energy consumption target for the 
building would be the value in either Tables A-1a to A-2a or Tables A-
1b to A-2b multiplied by the multiplier calculated in the previous 
sentence.

   Table VII.2--Shift Adjustment Multiplier by Hours of Operation and
                              Building Type
------------------------------------------------------------------------
                                            Weekly hours of operation
                                        --------------------------------
         Building activity/type            50 or
                                            less    51 to 167     168
------------------------------------------------------------------------
Admin/professional office..............          1          1        1.4
Bank/other financial...................          1          1        1.4
Government office......................          1          1        1.4
Medical office (non-diagnostic)........          1          1        1.4
Mixed-use office.......................          1          1        1.4
Other office...........................          1          1        1.4
Laboratory.............................          1          1        1.4
Distribution/shipping center...........        0.7        1.4        2.1
Nonrefrigerated warehouse..............        0.7        1.4        2.1
Convenience store......................          1          1        1.4
Convenience store with gas.............          1          1        1.4
Grocery store/food market..............          1          1        1.4
Other food sales.......................          1          1        1.4
Fire station/police station............        0.8        0.8        1.1
Other public order and safety..........        0.8        0.8        1.1
Medical office (diagnostic)............          1          1        1.5
Clinic/other outpatient health.........          1          1        1.5

[[Page 78432]]

 
Refrigerated warehouse.................          1          1          1
Religious worship......................        0.9        1.7        1.7
Entertainment/culture..................        0.8        1.5        1.5
Library................................        0.8        1.5        1.5
Recreation.............................        0.8        1.5        1.5
Social/meeting.........................        0.8        1.5        1.5
Other public assembly..................        0.8        1.5        1.5
College/university.....................        0.8        1.3        1.3
Elementary/middle school...............        0.8        1.3        1.3
High school............................        0.8        1.3        1.3
Preschool/daycare......................        0.8        1.3        1.3
Other classroom education..............        0.8        1.3        1.3
Fast food..............................        0.4        1.1        2.1
Restaurant/cafeteria...................        0.4        1.1        2.1
Other food service.....................        0.4        1.1        2.1
Hospital/inpatient health..............          1          1          1
Nursing home/assisted living...........          1          1          1
Dormitory/fraternity/sorority..........          1          1          1
Hotel..................................          1          1          1
Motel or inn...........................          1          1          1
Other lodging..........................          1          1          1
Vehicle dealership/showroom............        0.8        1.2        1.8
Retail store...........................        0.8        1.2        1.8
Other retail...........................        0.8        1.2        1.8
Post office/postal center..............        0.7        1.5        1.5
Repair shop............................        0.7        1.5        1.5
Vehicle service/repair shop............        0.7        1.5        1.5
Vehicle storage/maintenance............        0.7        1.5        1.5
Other service..........................        0.7        1.5        1.5
Strip shopping mall....................          1          1          1
Enclosed mall..........................          1          1          1
Bar/Pub/Lounge.........................          1          1        1.4
Courthouse/Probation Office............          1          1        1.4
------------------------------------------------------------------------

    (ii) Design for construction began during or after fiscal year 
2030. For new construction and major renovations of all Scope 1 fossil 
fuel-using systems in an EISA-subject building, the Scope 1 fossil 
fuel-generated energy consumption of the proposed building, based on 
building design and calculated according to Sec.  435.201(a), must be 
zero.
    (2) Major Renovations of a Scope 1 Fossil Fuel-Using Building 
System or Scope 1 fossil fuel-using Component within an EISA-Subject 
Building shall follow the renovation requirements in section 4.2.1.3 of 
the applicable building baseline energy efficiency standards listed in 
Sec.  435.4 substituting the term ``design for construction'' with 
``design for renovation'' for the relevant date, and shall replace all 
equipment that is included in the renovation with all electric or non-
fossil fuel using ENERGY STAR or FEMP designated products as defined in 
Sec.  436.42. For component level renovations, Agencies shall replace 
all equipment that is part of the renovation with all electric or non-
fossil fuel using ENERGY STAR or FEMP designated products as defined in 
Sec.  436.42.
    (d) EISA-Subject buildings that are of the type not included in 
Appendix A of this subpart--(1) Process load buildings. For building 
types that are not included in any of the building types listed in 
Tables A-1a to A-2a or A-1b to A-2b of appendix A of this subpart, or 
for building types in these tables that contain significant process 
loads, Federal agencies must select the applicable building type, 
climate zone, and fiscal year in which design for construction began 
from Tables A-1a to A-2a or A-1b to A-2b of appendix A of this subpart 
that most closely corresponds to the proposed building without the 
process load. The estimated Scope 1 fossil fuel-generated energy 
consumption of the process load must be added to the maximum allowable 
Scope 1 fossil fuel-generated energy consumption of the applicable 
building type for the appropriate fiscal year and climate zone to 
calculate the maximum allowable Scope 1 fossil fuel-generated energy 
consumption for the building. The same estimated Scope 1 fossil fuel-
generated energy consumption of the process load that is added to the 
maximum allowable Scope 1 fossil fuel-generated energy consumption of 
the applicable building must also be used in determining the Scope 1 
fossil fuel-generated energy consumption of the proposed building.
    (2) Mixed-use buildings. For buildings that combine two or more 
building types with process loads or, alternatively, that combine one 
or more building types with process loads with one or more building 
types in Tables A-1a to A-2a or A-1b to A-2b of appendix A of this 
subpart, the maximum allowable Scope 1 fossil fuel-generated energy 
consumption of the proposed building is equal to the averaged process 
load building values determined under paragraph (d)(1) of this section 
and the applicable building type values in Tables A-1a to A-2a or A-1b 
to A-2b of appendix A of this subpart, weighted by floor area. Equation 
1 shall be used for mixed use buildings.

Equation 1: Scope 1 Fossil fuel generated energy consumption for a 
mixed-use building = the sum across all building uses of (the fraction 
of total floor building floor area for building use i times the 
allowable fossil fuel-generated energy consumption for building use i)


[[Page 78433]]


    Equation 2 may be rewritten as:

Scope 1 Fossil Fuel-Generated Energy Consumption for a Mixed Use 
Building = [Sigma]ni=1
(Fraction of Total Building Floor Area for Building Use i times 
Allowable Scope 1 Fossil Fuel-Generated Energy Consumption for Building 
Use).


Sec.  435.201   Scope 1 Fossil fuel-generated energy consumption 
determination.

    (a) The Scope 1 fossil fuel-generated energy consumption of a 
proposed design is calculated as follows:

Equation: Scope 1 Fossil Fuel-Generated Energy Consumption = Direct 
Fossil Fuel Consumption of Proposed Building/Floor Area

Where:

Direct Scope 1 Fossil Fuel-Generated Energy Consumption of Proposed 
Building equals the total site Scope 1 fossil fuel-generated energy 
consumption of the proposed building calculated in accordance with 
the Simulated Performance Alternative in Section 405 of the IECC 
2021 (incorporated by reference; see Sec.  435.3), and measured in 
thousands of British thermal units per year (kBtu/yr), except that 
this term does not include fossil fuel consumption for emergency 
electricity generation. Agencies must include all on-site fossil 
fuel use or Scope 1 emissions associated with non-emergency 
generation from backup generators (such as those for peak shaving or 
peak shifting). Any energy generation or Scope 1 emissions 
associated with biomass fuels are excluded. Any emissions associated 
with natural gas for alternatively fueled vehicles (``AFVs'') (or 
any other alternative fuel defined at 42 U.S.C. 13211 that is 
provided at a Federal building) is excluded. Buildings with 
manufacturing or industrial process loads should be accounted for in 
the analysis for the building's fossil fuel consumption and GHG 
emissions but are not subject to the phase down targets.

    Floor Area is the floor area of the structure that is enclosed by 
exterior walls, including finished or unfinished basements, finished or 
heated space in attics, and garages if they have an uninsulated wall in 
common with the house. Not included are crawl spaces, and sheds and 
other buildings that are not attached to the house.


Sec.  435.202   Petition for downward adjustment.

    (a) New Federal buildings and major renovations of all Scope 1 
fossil fuel-using systems in an EISA-subject building. (1) Upon 
petition by a Federal agency the Director of FEMP may adjust the 
applicable maximum allowable Scope 1 fossil fuel energy consumption 
standard with respect to a specific building, upon written 
certification from the head of the agency designing the building, that 
the requested adjustment is the largest feasible reduction in Scope 1 
fossil fuel energy consumption that can practicably be achieved in 
light of the specified functional needs for that building, as 
demonstrated by:
    (i) A statement sealed by the design engineer that the proposed 
building was designed in accordance with the applicable energy 
efficiency requirements to the maximum extent practicable and that each 
fossil fuel consuming product included in the proposed building that is 
of a product category covered by the ENERGY STAR program or FEMP for 
designated products is an ENERGY STAR product or a product meeting the 
FEMP designation criteria, as applicable;
    (ii) A description of the systems, technologies, and practices that 
were evaluated and unable to meet the required fossil fuel reduction 
including a justification of why achieving the Scope 1 fossil fuel-
generated energy consumption targets would be technically 
impracticable: and
    (iii) Any other information the agency determines would help 
explain its request;
    (2) The head of the agency designing the building, must also 
include the following information in the petition:
    (i) A general description of the building, including but not 
limited to location, use type, floor area, stories, expected number of 
occupants and occupant schedule, project type, project cost, and 
functional needs, mission critical activity, research, and national 
security operations as applicable;
    (ii) The maximum allowable Scope 1 fossil fuel energy consumption 
for the building from paragraphs (c) or (d) of this section;
    (iii) The estimated Scope 1 fossil fuel energy consumption of the 
proposed building;
    (iv) A description of the proposed building's energy-related 
features, including but not limited to:
    (A) HVAC system type and configuration;
    (B) HVAC equipment sizes and efficiencies;
    (C) Ventilation systems (including outdoor air volume, controls 
technique, heat recovery systems, and economizers, if applicable);
    (D) Service water heating system configuration and equipment 
(including solar hot water, wastewater heat recovery, and controls for 
circulating hot water systems, if applicable);
    (E) Estimated industrial process loads; and
    (F) Any other on-site fossil fuel consuming equipment.
    (3) Petitions for downward adjustment should be submitted to [email protected], or to: U.S. Department of Energy, FEMP, Director, 
Fossil Fuel Reduction Petitions, EE-5F, 1000 Independence Ave. SW, 
Washington, DC 20585-0121.
    (4) The Director will make a best effort to notify the requesting 
agency in writing whether the petition for downward adjustment to the 
numeric reduction requirement is approved or rejected, in 45 calendar 
days of submittal, granted the petition is complete. If the Director 
rejects the petition or establishes a value other than that presented 
in the petition, the Director will forward its reasons for rejection to 
the petitioning agency.
    (b) Major renovations of a Scope 1 fossil fuel-using building 
system or Scope 1 fossil fuel-using component. (1) Upon petition by a 
Federal agency, the Director of FEMP may adjust the applicable 
requirements for the Federal agency to reduce Scope 1 on-site fossil 
fuel-generated energy consumption standard with respect to a specific 
renovation, upon written certification from the head of the agency 
designing the renovation, that the requested adjustment is the largest 
feasible reduction in Scope 1 fossil fuel energy consumption that can 
practicably be achieved in light of the specified functional needs for 
that building, as demonstrated by:
    (i) A statement Sealed by the design engineer that the proposed 
renovation incorporates commercially available systems and/or 
components that provide a level of energy efficiency that is life-cycle 
cost effective as defined in this part and reduces consumption of Scope 
1 fossil fuel energy consumption to the maximum extent practicable and 
that each fossil fuel consuming product included in the proposed 
building that is of a product category covered by the ENERGY STAR 
program or FEMP for designated products is an ENERGY STAR product or a 
product meeting the FEMP designation criteria, as applicable.
    (ii) A description of the systems, technologies, and practices that 
were evaluated and unable to meet the required fossil fuel reduction 
including a justification of why achieving the Scope 1 fossil fuel-
generated energy consumption targets would be technically 
impracticable: and
    (iii) Any other information the agency determines would help 
explain its request.
    (2) The head of the agency making the design decisions for the 
building, must

[[Page 78434]]

also include the following information in the petition:
    (i) A general description of the building, including but not 
limited to location, use type, floor area, stories, estimated number of 
occupants and occupant schedule, project type, project cost, and 
functional needs, mission critical activity, research, and national 
security operations as applicable;
    (ii) The maximum allowable Scope 1 fossil fuel energy consumption 
for the building from Sec.  435.200(c) or (d);
    (iii) The estimated Scope 1 fossil fuel energy consumption of the 
building;
    (iv) A description of system(s) or component(s) that are being 
renovated, including but not limited to:
    (A) HVAC system or component type and configuration;
    (B) HVAC equipment sizes and efficiencies;
    (C) Ventilation systems or components (including outdoor air 
volume, controls technique, heat recovery systems, and economizers, if 
applicable);
    (D) Service water heating system or component configuration and 
equipment (including solar hot water, wastewater heat recovery, and 
controls for circulating hot water systems, if applicable);
    (E) Estimated process loads; and
    (F) Any other on-site fossil fuel consuming equipment.
    (3) Petitions for downward adjustment should be submitted to [email protected], or to: U.S. Department of Energy, FEMP, Director, 
Fossil Fuel Reduction Petitions, EE-5F, 1000 Independence Ave. SW, 
Washington, DC 20585-0121.
    (4) The Director will make a best effort to notify the requesting 
agency in writing whether the petition for downward adjustment to the 
numeric reduction requirement is approved or rejected, in 45 calendar 
days of submittal for major renovations of a buildings system, and 20 
calendar days for major renovations of a component, granted the 
petition is complete. If the Director rejects the petition, the 
Director will forward its reasons for rejection to the petitioning 
agency.
    (c) Exclusions. The General Services Administration (GSA) may not 
submit petitions under paragraphs (a) and (b) of this section. Agencies 
that are tenants of GSA buildings for which the agency, not GSA, has 
significant design control may submit petitions in accordance with this 
section.

Appendix A to Subpart B of Part 435 Maximum Allowable Scope 1 Fossil 
Fuel Generated Energy Consumption

    (a) For purposes of the tables in this appendix, the climate 
zones for each county in the United States are those listed in 
Figure 301.1 of IECC 2021 (incorporated by reference; see Sec.  
435.3).
    (b) For purpose of appendix A, the following definitions apply:
    Mobile Home means a dwelling unit built to the Federal 
Manufactured Home Construction and Safety Standards in 24 CFR part 
3280, that is built on a permanent chassis and moved to a site. It 
may be placed on a permanent or temporary foundation and may contain 
one or more rooms.
    Multi-Family in 2-4 Unit Buildings means a category of 
structures that is divided into living quarters for two, three, or 
four families or households in which one household lives above or 
beside another. This category also includes houses originally 
intended for occupancy by one family (or for some other use) that 
have since been converted to separate dwellings for two to four 
families.
    Multi-Family in 5 or More Unit Buildings means a category of 
structures that contain living quarters for five or more households 
or families and in which one household lives above or beside 
another.
    Single-Family Attached means a building with two or more 
connected dwelling units, generally with a shared wall, each 
providing living space for one household or family. Attached houses 
are considered single-family houses as long as they are not divided 
into more than one dwelling unit and they have independent outside 
entrances. A single-family house is contained within walls extending 
from the basement (or the ground floor if there is no basement) to 
the roof. Townhouses, row houses, and duplexes are considered 
single-family attached dwelling units, as long as there is no 
dwelling unit above or below another.
    Single-Family Detached means a separate, unconnected dwelling 
unit, not sharing a wall with any other building or dwelling unit, 
which provides living space for one household or family. A single-
family house is contained within walls extending from the basement 
(or the ground floor if there is no basement) to the roof. This 
includes modular homes but does not include mobile homes.

[[Page 78435]]



                Table A-1a--FY2020-FY2024 Maximum Allowable Fossil Fuel-Generated Energy Consumption by Building Category, Building Type and Climate Zone, Residential Buildings
                                                                                         [CO2e/yr-sqft]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
        Building category                Climate zone:         0A     0B     1A     1B     2A     2B     3A     3B     3C     4A     4B     4C     5A     5B     5C     6A     6B     7      8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                   Building activity/type..                                       Fossil fuel-generated energy use intensity (CO2e/yr-sqft)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Residential......................  Mobile..................   0.66   0.67   0.68   0.73   0.80   0.78   0.92   0.76   0.87   0.92   1.07   1.05   1.06   1.23   1.19   1.11   1.36   1.36   1.51
Residential......................  Single-family detached..   0.40   0.41   0.41   0.45   0.50   0.48   0.58   0.47   0.55   0.58   0.69   0.67   0.68   0.79   0.76   0.71   0.88   0.88   0.99
Residential......................  Single-family attached..   0.76   0.76   0.77   0.78   0.80   0.79   0.83   0.79   0.82   0.83   0.87   0.87   0.87   0.92   0.90   0.88   0.95   0.95   0.99
Residential......................  Multi-family (in 2-4-      0.56   0.57   0.61   0.74   0.93   0.87   1.25   0.83   1.11   1.25   1.64   1.58   1.62   2.06   1.95   1.74   2.40   2.41   2.82
                                    unit building).
Residential......................  Multi-family (in 5+ unit   0.24   0.25   0.29   0.42   0.61   0.55   0.93   0.51   0.80   0.93   1.32   1.26   1.30   1.74   1.63   1.42   2.08   2.09   2.50
                                    building).
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


                Table A-1b--FY2020-FY2024 Maximum Allowable Fossil Fuel-Generated Energy Consumption by Building Category, Building Type and Climate Zone, Residential Buildings
                                                                                      [Source kBtu/yr-sqft]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
        Building category                Climate zone:         0A     0B     1A     1B     2A     2B     3A     3B     3C     4A     4B     4C     5A     5B     5C     6A     6B     7      8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                   Building Activity/Type..                                     Fossil fuel-generated energy use intensity (site kBtu/yr-sqft)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Residential......................  Mobile..................      6      6      6      7      7      7      8      7      8      8     10     10     10     11     11     10     12     12     14
Residential......................  Single-family detached..      4      4      4      4      5      4      5      4      5      5      6      6      6      7      7      6      8      8      9
Residential......................  Single-family attached..      7      7      7      7      7      7      8      7      7      8      8      8      8      8      8      8      9      9      9
Residential......................  Multi-family (in 2-4-         5      5      6      7      8      8     11      8     10     11     15     14     15     19     18     16     22     22     26
                                    unit building).
Residential......................  Multi-family (in 5+ unit      2      2      3      4      6      5      8      5      7      8     12     11     12     16     15     13     19     19     23
                                    building).
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


                Table A-2a--FY2025-FY2029 Maximum Allowable Fossil Fuel-Generated Energy Consumption by Building Category, Building Type and Climate Zone, Residential Buildings
                                                                                         [CO2e/yr-sqft]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
        Building category                Climate zone:         0A     0B     1A     1B     2A     2B     3A     3B     3C     4A     4B     4C     5A     5B     5C     6A     6B     7      8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                   Building Activity/Type..                                       Fossil fuel-generated energy use intensity (CO2e/yr-sqft)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Residential......................  Mobile..................   0.33   0.34   0.37   0.40   0.39   0.46   0.38   0.44   0.46   0.54   0.52   0.53   0.62   0.59   0.55   0.68   0.68   0.76   0.33
Residential......................  Single-family detached..   0.20   0.21   0.22   0.25   0.24   0.29   0.24   0.27   0.29   0.34   0.33   0.34   0.40   0.38   0.35   0.44   0.44   0.50   0.20
Residential......................  Single-family attached..   0.38   0.38   0.39   0.40   0.40   0.42   0.39   0.41   0.42   0.44   0.43   0.44   0.46   0.45   0.44   0.47   0.48   0.50   0.38
Residential......................  Multi-family (in 2-4-      0.28   0.30   0.37   0.46   0.44   0.62   0.41   0.56   0.63   0.82   0.79   0.81   1.03   0.97   0.87   1.20   1.20   1.41   0.28
                                    unit building).
Residential......................  Multi-family (in 5+ unit   0.13   0.14   0.21   0.30   0.28   0.46   0.25   0.40   0.47   0.66   0.63   0.65   0.87   0.81   0.71   1.04   1.04   1.25   0.13
                                    building).
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


                 Table A-2b-FY2025-FY2029 Maximum Allowable Fossil Fuel-Generated Energy Consumption by Building Category, Building Type and Climate Zone, Residential Buildings
                                                                                      [Source kBtu/yr-sqft]
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
        Building category                Climate zone:         0A     0B     1A     1B     2A     2B     3A     3B     3C     4A     4B     4C     5A     5B     5C     6A     6B     7      8
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                   Building Activity/Type..                                     Fossil fuel-generated energy use intensity (site kBtu/yr-sqft)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Residential......................  Mobile..................      3      3      3      3      4      4      4      3      4      4      5      5      5      6      5      5      6      6      7
Residential......................  Single-family detached..      2      2      2      2      2      2      3      2      2      3      3      3      3      4      3      3      4      4      4
Residential......................  Single-family attached..      3      3      3      4      4      4      4      4      4      4      4      4      4      4      4      4      4      4      5
Residential......................  Multi-family (in 2-4-         3      3      3      3      4      4      6      4      5      6      7      7      7      9      9      8     11     11     13
                                    unit building).
Residential......................  Multi-family (in 5+ unit      1      1      1      2      3      3      4      2      4      4      6      6      6      8      7      6      9      9     11
                                    building).
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 78436]]

[FR Doc. 2022-27098 Filed 12-20-22; 8:45 pm]
BILLING CODE 6450-01-P