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HomeMy WebLinkAboutStaff Report 10208 City of Palo Alto (ID # 10208) City Council Staff Report Report Type: Informational Report Meeting Date: 4/1/2019 City of Palo Alto Page 1 Council Priority: Climate/Sustainability and Climate Action Plan Summary Title: Green Building Program Update Title: Green Building Program Update From: City Manager Lead Department: City Manager Executive Summary This memo provides an interim update on the City of Palo Alto’s recent efforts related to its Green Building Program. The City’s Sustainability Implementation Plan (SIP) commits to exploring green building, energy efficiency, and electrification policy options that go beyond code minimum in the next update to our building codes. The next applicable code update cycles will be the adoption of the 2019 California Code of Regulations, Title 24, that incorporates the 2019 California Green Building Code and 2019 California Energy Code. Once adopted , these regulations will be enforceable starting on January 1st, 2020. Staff will return to Council in the latter half of 2019 with proposed regulations to provide increased standards to these codes. In the interim, this memo summarizes the City’s work over the last year in support of this effort and summaries recent progress in related ongoing programs to support green building in Palo Alto. Background Every three years, the State of California adopts new building standards that are codified in Title 24 of the California Code of Regulations, referred to as the California Building Standards Code. Since 2008, Palo Alto has a history of developing requirements that are more stringent than the baseline State requirements in the California Green Building and Energy Codes; we refer to our more stringent requirements as “reach codes” because they reach beyond the state standards. Energy efficiency requirements reside in chapter 16.17 of the Palo Alto Municipal Code , which adopts and modifies the current version of the California Energy Code. Water efficiency, electric vehicle charging, material conservation, resource efficiency, and indoor air quality requirements reside in chapter 16.14 of the Palo Alto Municipal Code which adopts and modifies the current version of the California Green Building Code. City of Palo Alto Page 2 These local energy and green building regulations are intended to create a new generation of efficient, environmentally responsible, and healthy buildings. The current energy requirements in the Palo Alto Municipal Code include specific cost-effective compliance options that are triggered on permit applications for the following project types: 1) new single-family residential, 2) new multi-family residential, and 3) new commercial construction. More detailed information about the City’s Energy Reach Code Ordinance may be found in the staff report for the last update to this portion of the code from May 2, 2016 (ID #6796), when the Council voted 9-0 to adopt and amend the code as recommended. Discussion This staff report will summarize staff progress in three areas: • Green Building Summit and Green Building Technical Advisory Group: Community engagement and policy development efforts to inform our green building and energy code updates; • Statewide and Regional efforts: the City of Palo Alto has partnered with other jurisdictions to strengthen broader coalitions to promote sustainability gains in the green building arena; and • Ongoing Green Building Compliance and Incentive Programs: the City of Palo Alto continues to provide exceptional customer service support and financial incentives to strengthen the impact of the City’s green building priorities. Green Building Summit and Green Building Technical Advisory Group Several years ago, City staff convened a multi-disciplinary stakeholder committee, the Green Building Advisory Group (GBAG), to gain knowledge and suggestions for consideration into municipal code changes. GBAG is comprised of archit ects, engineers, energy modelers, developers, and contractors, and has met regularly since 2013 to help staff develop new recommendations for local green building and energy policies. On February 22, 2018, the City of Palo Alto hosted the “Green Building Summit” at Mitchell Park Community Center. The summit included the GBAG members and a panel of several distinguished guest experts, including Commissioner Andrew McAllister of the California Energy Commission, and Jason McLennan, the creator of the Living Building Challenge and an internationally-recognized leader in green building and sustainability. More than 50 community members joined with City staff from multiple departments to explore ways to address local priorities in the upcoming 2019 California Code of Regulations, Tile 24 update around energy efficiency, water efficiency, electrification, emissions, indoor air quality, and construction waste and debris management. Following the Green Building Summit, the Green Building Technical Advisory Commit tee (TAC), a sub-committee of the Green Building Advisory Group (GBAG), was convened for a vetting effort to explore building electrification and energy efficiency measures along with other green City of Palo Alto Page 3 building subject areas, as directed by the Sustainability Implementation Plan (SIP). The TAC convened for ten community meetings between May and December of 2018 to review and discuss possible changes to the municipal code. The first four meetings were related to energy efficiency, emissions, and electrification, including one meeting dedicated to the topic of electric vehicles. Another three meetings were related to indoor air quality, material conservation and resource efficiency, construction waste and debris management, and water efficiency. There were also three final meetings to summarize the suggestions for future green building and energy reach policies. All agendas and meetings minutes are posted on the city’s Green Building Advisory Group webpage. As part of the 2018 TAC effort, the City of Palo Alto sponsored the preparation of an Energy Reach Code Cost-Effectiveness Analysis that examined possible energy efficiency measures, including building electrification, for buildings within Palo Alto. In order to codify local energy efficiency requirements, the California Energy Commission requires that a cost -effectiveness study be conducted and filed in the case of a local amendment to the California Energy Code. It is required that the City demonstrate to the California Energy Commission, using a cost- effectiveness study, that the amendments to the code are financia lly responsible to the commercial and residential applicants. The study analyzes building design strategies that are more stringent than the upcoming 2019 California Energy Code, which goes into effect starting January 1st, 2020. When the TAC reviewed the findings of the City-sponsored study in late 2018, some members of the group expressed concerns that the findings may have been limited by the specificity of the original scope of the study. At about this time, staff learned of a newly forming statewide effort to conduct a more comprehensive cost-effectiveness study. City staff therefore decided to postpone the development of recommendations to the City Council pending the outcome of the statewide study projected to be released on June 30 th, 2019. Statewide and Regional Efforts Palo Alto has joined a consortium of approximately thirty-five jurisdictions from throughout California to perform the statewide research project on building electrification. The results of the Palo Alto study were released during the beginning of the statewide study and helped the policy researchers by informing the direction of the statewide study. Participation in the statewide effort will help participating jurisdictions in the development of local Energy code changes. This will allow for new regulations to be based on the most robust statewide body of knowledge. While preliminary data is beginning to emerge from the statewide effort, the final report is anticipated at the end of June. Palo Alto staff will reconvene stakeholders to gather additional policy input once the final report has been analyzed, with the goal of bringing policy recommendations to the City Council in the second half of calendar year 2019. In addition to the statewide cost-effectiveness study, Palo Alto is partnering with the Bay Area Regional Energy Network (BayREN), a collaboration of local governments from nine counties in City of Palo Alto Page 4 the Bay Area, to implement a regional market transformation program for heat -pump water heaters. Heat-pump water heaters (HPWH) are a focus of attention because they are far more energy efficient that gas-fueled water heaters. Heat pump systems also eliminate GHG emissions associated with gas-fired space heaters while improving air quality within the dwelling units. The BayREN program has been awarded grant funding from the Bay Area Air Quality Management District (BAAQMD) and will provide contractor training, consumer education, and a HPWH incentive to distributors throughout the Bay Area. The regional program approach seeks to catalyze market transformation and address the persistent barriers that are less effectively addressed on a local scale. This program is expected to launch in spring of 2019. This is an example of focusing on market readiness, in addition to enforcing regulations, to more effectively promote the adoption of energy saving practices and equipment. Ongoing Green Building Compliance and Incentive Programs Codes are only effective if they are followed. Palo Alto’s Development Services Department has developed a Green Building Program to support compliance with the City’s green building and energy regulations. The program provides applicants with informative resources to streamline compliance with, and support understanding of, Palo Alto’s Green Building ordinances. The City’s Green Building Compliance webpage outlines requirements in the planning entitlement, plan check, inspection and post-occupancy phases for residential and commercial projects. The webpage provides 24/7 access to on-demand video trainings to help residential and non- residential project applicants understand the requirements and submittal process for permit applications. Additional videos have been created to promote Zero Net Energy strategies. In addition to the Green Building Compliance Program operated by the Development Services Department, Palo Alto’s Utilities Department has developed several financial incentive opportunities that support the Green Building Program. A heat-pump water heater pilot program was launched in spring of 2016 to encourage residents to replace their gas water heaters with more efficient heat-pump water heaters (HPWHs). The pilot program website provides information on rebate levels (up to $1,500), qualifying models that meet the minimum efficiency standard required by the California Energy Commission, and installation considerations. In May 2017, the program was expanded to include rebates for new construction projects. The HPWH pilot website was updated with a new look and feel in December 2017. In the past two years, the City has hosted two HPWH workshops with representatives from HPWH manufacturers providing overview of their products for homeowners, contractors and building professionals. As of December 2018, the City has paid rebates for 36 HPWHs, including 13 rebates paid to a new, all electric multi-family building. In July 2018, the Utilities Department was awarded a 2018 Climate Protection Grant in the amount of $296,220 from BAAQMD to implement a Multi-family Gas Furnace to Heat Pump Retrofit pilot program. The pilot will target up to three low-income apartment buildings to replace existing in-unit gas wall furnaces with high efficiency air source heat pumps. This City of Palo Alto Page 5 program will identify the technical and logistical hurdles of retrofitting the gas wall furnaces with heat pump units, and will conclude with a summary of the retrofit cost, energy savings and avoided GHG emissions in a case study. An RFP was issued to implement this pilot program in December 2018 and an implementation vendor was selected in February 2019. The City is also supporting green building through its Electric Vehicle (EV) Charger Rebate Program, launched in January 2017. The program currently offers incentives of up to $18,000 for multi-unit dwellings (MUDs) and up to $30,000 for schools and nonprofit organizations. The scope of the rebates includes financial support to upgrade electrical infrastructure and install EV chargers, also known as Electric Vehicle Supply Equipment (EVSEs), for communal use. To date, 28 properties have applied to participate in the EV Charger Rebate Program. To further encourage EV charger installations for existing buildings, the Utilities Department issued an RFP for EV Solutions and Technical Assistance. The contract is currently being finalized and is expected to be executed in April. Resource Impact The Development Services Department’s Green Building Program was funded with a $300,000 non-salary expense appropriation for Fiscal Year 2019. The costs are recovered through development fees. Other City departments’ sustainability allocations are also approved by City Council, through the annual budget process, and are typically cost recovery due the enterprise nature of Utilities, Zero Waste and the Water Quality Control Treatment Plant.