Trustees debate ‘Electric Preferred’ building code amendment

The Buena Vista Board of Trustees revisited a discussion on whether to approve a resolution of support for the Electric Preferred Amendment to the county’s energy codes at their meeting on May 13.

The board had previously heard from representatives from the county building department, who asked trustees on behalf of the Board of County Commissioners to approve the amendment to the building codes.

Ultimately, it’s the Commissioners’ call whether to amend the code, but the board is seeking resolutions of approval from each of the county’s municipalities before proceeding.

The Salida City Council passed a resolution in support of the Electric Preferred amendment last year, while Poncha Springs and Buena Vista have not yet voted on the matter.

The 2021 energy code, adopted in Chaffee County last year per state law, requires new construction to be “electric-ready,” meaning that while natural gas appliances may be installed, the home must also be built with the necessary wiring and panel capacity to accept the installation of electric appliances in the future without retrofitting. The “Solar Ready” component of the code requires that roofs be designed to accommodate the installation of solar panels.

The proposed “Electric Preferred” amendment incentivises new construction to be built with only electric utilities without prohibiting the use of fossil fuels like natural gas outright.

During a presentation by Chaffee County building official Chad Chadwick to the board during their April 8 meeting, Chadwick described builders needing to achieve a certain number of “points” for energy efficiency to pass inspection. Under the Electric-Preferred amendment rubric, including appliances powered by fossil fuels would be a demerit that the builder would need to offset with increased green building measures elsewhere in construction.

Chadwick was joined by Salida environmental lawyer Matt Nyckiel and Christine Brinker, the senior buildings policy manager for the Southwest Energy Efficiency Project, on April 8, advocating that the Buena Vista board vote in favor of the amendment. 

On May 13, the board heard from Briston James, a representative of natural gas distributor Atmos Energy, as well as two staff from Sangre de Cristo Electric Association: Chief Finance Officer Sarah Crites and Business Development Specialist Mike Allen.

James spoke against the amendment, while Crites said that SDCEA had decided to remain neutral on the issue.

James, a public affairs manager for Dallas-based Atmos Energy, had previously spoken during public comment at the April 8 meeting, advocating for the gas industry, and town staff invited him back on Tuesday to give a more extensive presentation.

He stressed that natural gas transmission lines were underground, which he said made the fuel more reliable than electric, and that gas was much more affordable.

“A home which uses both fuels, electric and gas, tends to save a substantial amount of money. In Climate zone 6, I believe the figure is closer to $1,400 a year,” James said. “Consistently in the last few years, it’s been proven that a household that uses electricity and gas has a 36 percent lower carbon footprint than one that just uses electricity alone. Why is that? As one of the folks who presented comment said tonight, we generate using gas. … That carbon footprint is a necessary component of electricity generation at this point in time. One day, that may change, but at this point, that’s just where we are.”

James also cited the National Home Buyers Association, saying that “you add 22 to 24,000 for the construction of a home with the implementation of the 2021 IECC.”

“These studies, where you compare electric versus gas, are these baseboard electric and electric furnaces, or is it based on the newer, more efficient heat pumps?” asked Devin Rowe.

James responded: “The GTI (Gas Technology Institute) study, where most of our cost comparisons come from, takes into account the type of device, the model, manufacturer of the device, the rates paid within a zip code. Then they compare those to another type of device, whether that’s propane, natural gas. That’s how GTI does their work. There are other groups who do similar work in the country, I’m just more familiar with GTI.”

“I would just ask that we take everything we’re being presented with – no offense – with a grain of salt. Atmos Energy is a tens-of-billions-of-dollars-worth company based in Texas. They’re one of the largest natural gas distributors in the world. The gas industry runs GTI. All of these studies are funded and paid for by the natural gas industry to demonstrate that natural gas is whatever they want it to be to sell it to us,” said Micha Rosenoer. “Frankly, I’m not happy that we’ve invited an oil and gas company to come and present to us on the benefits of oil and gas. I would ask that we really think about the source of this information.”

Andrew Rice added, “There’s regulatory pressure on all forms of energy to reduce greenhouse gas emissions,” citing a 2021 Colorado state Senate bill that requires oil and gas utilities to develop “Clean Heat Plans” to reduce their greenhouse gas emissions by 22 percent by 2030.

“I believe we’re at 70 percent of our target for that reduction,” James said.

When it was SDCEA’s turn to present, Crites stressed that the co-op was a non-profit 501(c)12 and that the Co-op was not taking a position for or against adoption.

The board nonetheless had several questions for Crites and Allen about the economics of SDCEA’s pricing.

“Why is our electricity more expensive than the rest of the state if you’re not-for-profit?” asked Cindie Swisher.

Crites said, “When you’re comparing a rural cooperative to, say, an Xcel Energy or a Black Hills Energy, we serve less people per mile of line. We have eight services per mile of line, compared to a city or urban area where they would have 20 or 50 services per mile of line. The density of those that they serve means that they can spread those costs to more people.”

Swisher asked why gas utilities didn’t have the same problem.

“Atmos Energy … (is) like Xcel, they have a lot of customers that they can spread those costs to. So even if it’s a rural area, that rural area may be subsidized by those larger towns.”

The type of user that predominates the SDCEA service area is also a factor, Crites said.

“We don’t have a lot of industry here, so most of our revenue comes from our residential class, which places a higher burden on our residential class,” she said.

Allen said that the biggest customer in Sangre’s service area was the Buena Vista Correctional Complex.

Maggie Huyck asked why, if the number of users is increasing, costs are not decreasing.

Crites replied that weather also impacts Sangre’s prices. The past season’s extraordinarily mild winter meant that users were drawing less power than in the previous year. 

In addition, she noted the flip side to the argument that an energy-efficient building “pays for itself” through lower monthly energy costs: Energy-efficient buildings buy less power.

“So, adding more energy efficiency … we probably won’t see a reduction in our electricity costs,” Huyck concluded.

Allen reiterated that Sangre’s demand was limited by the fact that its service area is primarily residential – with second homes that are only occupied for parts of the year – and said, ”Sixty-plus percent of our members heat their homes, which is the primary use of energy in a home, with propane first, then natural gas, then electricity. That’s the order in which our members heat their homes.”

He also repeated that the co-op’s official position was to be neutral about the energy code amendment, and that “It’s a complicated equation here, but what we’re trying to do is give you a perspective of what it’s like to operate a very rural cooperative.”

“I think we’re conflating the cost of an energy bill with the cost per kilowatt-hour,” Rosenoer said. “The cost per kilowatt-hour might stay the same, but your bill should go down because of just the efficiency alone.”

Allen said, “Whatever energy source you’re using, whether it be natural gas or electricity, we want to be sure the building envelope is fully insulated, you have good windows, all of those things. We want to be sure that envelope is good. That’s where a lot of building energy codes make sense to us. We don’t want our members to have homes that are inefficient in that regard.”

“It preserves choice while incentivizing efficiency,” Rowe said. “Supporting things that are better for the environment in the long run, this seems like an easy first step.”

Rowe also said we should not rely too much on a single fuel source.

Rosenoer recalled that developers have regularly come before the board using the town’s fear of unaffordability as leverage in their negotiations with it.

“We’re talking a little about affordability of homes here. Generally, the folks we’re hearing from who are opposed to this, they’re builders, they’re developers, it’s the gas company, it’s the distributor. We also hear from them about affordability costs when it comes to parking and fee-in-lieu, and that building affordable housing is expensive,” she said. “I think it’s irresponsible to treat this as an affordable housing issue when we have a lot of other levers we can pull, like short-term rentals. … I just think it’s a nice talking point for folks who are not putting their money where their mouth is when it comes to supporting affordable housing.”

Huyck said that Tri-State Generation, the Westminster-based energy wholesaler from which Sangre buys its energy, generates from a mix of sources. In its 2024 annual report, Tr-State said that it generated 36 percent of its power from renewable sources, with the remainder coming from coal and natural gas. In the same report, it states a goal of nearly inverting that ratio by 2030, having 70 percent of its fuel mix come from renewables.

For Huyck, the difference between that and natural gas, which is itself a fossil fuel, didn’t amount to much.

Huyck said: “In this world and this area, losing that redundancy and heating choice is not an option. By making one preferred over another, is a little bit of an overreach,” she said. “Efficiency, yes. Environmentally, having that at the forefront, yeah, absolutely. I don’t know that I firmly understand why we need Electric Preferred when our electricity comes from a natural gas-powered plant.”

Rosenoer responded: “They use natural gas because it’s available, but Electricity Preferred means that we won’t be stuck in an only natural gas option long-term. … Electricity is the only option if we want to use anything but gas.”

“For me, Electric Preferred takes away the option of choice for that builder,” Huyck said. “Electric Ready still provides that diversity … If we were a big city, completely different conversation, right? But we’re not.”

Swisher was also against adopting the amendment, saying, “Building codes were meant to keep a building safe – Bring no harm. The code should not be deciding one energy preference over the other. … To do that, you are increasing the cost of affordable housing. Any unnecessary code that is made increases the cost of housing.”

“It does seem to me that it adds a significant cost to the building,” said Mayor Libby Fay.

Rice said, “It seems to me what this code is doing is very blatantly discouraging the use of gas.

“The market pressure already exists, and you’re adding cost to a house that wants to use gas,” he said.

In the final exchange of Tuesday’s discussion about the proposed amendment, Rowe said, “I’d like to know exact costs, because I feel like I’ve heard a lot of people say different things about how much it will actually cost.”

During the April 8 meeting, Chadwick said that “there isn’t much to say that this will raise the cost of affordable housing,” citing in his presentation a study of Eagle County which found that annual energy costs decreased 19 percent under the 2021 IECC with electric-preferred provisions compared to the 2015 edition of I-codes.

Homes built under codes with more aggressive energy efficiency standards can be more competitive in receiving state grants, which often have green building requirements attached, and it spares a builder the cost of installing a natural gas connection.

“We’ve got surveys and we’ve got data from various sources, but unfortunately, I don’t think we’re in a position to say that this is the exact impact,” town administrator Brian Berger said.

After over an hour of back-and-forth, with each trustee’s disposition on the amendment virtually identical to what it was when the discussion first began at the April 8 meeting, the board voted to bring back the issue at a later meeting to give more time for feedback from the public.