Reduce First Cost in a Multifamily Development: An Example of Performance Path Energy Code Compliance
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Are you throwing away money on your multifamily project?
If you are involved in building a new multifamily development that is four stories [1] or higher (therefore subject to commercial energy codes), you could be unknowingly wasting huge amounts of money from your construction budget!
[1] Multifamily projects that are 3 stories and fewer are subject to residential energy codes.
We are referring to the powerful benefits of using a performance-based approach for IECC energy code compliance (performance path), as opposed to the significant penalties that may accompany the standard, prescriptive (COMcheck) method of code compliance.
In most cases, the performance path includes these methods of cost savings:
Eliminating continuous insulation (ci) on the above-grade walls
Reducing roof insulation levels
Removing insulation requirements on parking structures
Providing more flexibility on glazing and window selection
Allowing the selection of more cost-effective HVAC equipment
How is this possible?
The performance path is an alternative code compliance pathway to help avoid overly restrictive energy code requirements and costs. This allows buildings to pass code if the overall energy performance beats code. This differs from COMcheck which requires each building system to meet or exceed code.
The multifamily sector, especially those constructed with wood framing, have very favorable comparisons under the performance path. Table 1 below illustrates these comparisons. Since most multifamily buildings use systems very similar to the COMcheck values, they can pass code even with reduced efficiency (and cost).
Table 1: Key comparisons of COMcheck vs. performance path 
[2] Listed value is for 2x4 walls. R-20 batt would be applicable for 2x6 walls. Same U-Value for both
[3] This is roughly equivalent to most 14 SEER units – EER is used for comparison.
Energy Code Compliance: A Quick Overview
Using IECC 2018 as an example, there are three possible paths for code compliance, as shown in Figure 1 below. These can be visually explained in Figure 2. For this report, we are considering only IECC Performance (Option 3).
Figure 1: Excerpt from IECC 2018 indicating the possible applications
Figure 2: Visual of possible IECC 2018 compliance options. Some important notes:
All methods require meeting mandatory requirements. A project then needs to meet prescriptive compliance or performance compliance.
There are pros and cons in using IECC vs. ASHRAE 90.1 on any given project.
IECC Performance (Option 3) and the two non-COMcheck ASHRAE options use an energy model to demonstrate compliance. IECC requires >15% savings while ASHRAE requires >0% savings against more stringent requirements.
Example
Here is an example of how the performance path can be applied:
[4] For simplicity, clubhouse and/or amenity buildings have been excluded.
Figure 3: Rendering of example apartment buildingResults
Performance Path simulation results are shown in Table 2, below. As the results indicate, the design passes IECC under the performance path by achieving more than 19% cost savings [5]. Figure 4 indicates that this design would not have passed COMcheck.
Table 2: Simulation Results
[5] Cost savings based on ‘regulated’ savings which excludes equipment not covered by IECC, such as receptacle loads.
Cost Savings
The main source of cost savings in the example apartment building is a wall system without continuous insulation, such as EIFS. Normally, the design would use 1” polystyrene to meet energy code. Historical data from RSMeans quantifies this extra insulation at $0.98/ft2. This amounts to nearly $200,000 in first cost savings!
It is possible that the reduced insulation levels may require up-sizing some HVAC units. In most cases, this expense, if applicable, is still far less than the insulation cost savings.
In the case of 2x6 wood framing, designers would use R-19 batt instead of the R-21 that the energy code attempts to enforce. Cost savings would be less significant in this case.
Wait, why be less efficient?
This is a logical question! However, a better question is: “what is the added utility cost from the reduction in insulation? On the following page, Table 3 illustrates that the development would save more than $4,200 annually with continuous insulation. With the $200,000 investment this requires, this is a simple payback of over 47 years! This return on investment (ROI) should be unacceptable to just about every owner and developer.
Moreover, most developments are set up where the residents pay their electricity bill. Because of this, the utility bill savings – however significant – does not impact the valuation of property to investors since it does not translate to overhead costs.
Table 3: Benefits of continuous wall insulation, example apartment complex
Figure 4: Failed COMcheckWhat to Remember
There are multiple paths for energy code compliance – choose the best one for your project!
The performance path for energy code compliance can save a lot of money on the construction budget for a multifamily development.
Increasing insulation levels is not always a wise investment!
What about your building?
Are you working on a new multifamily development? Would reducing your construction budget make life easier?
Contact G2 Energy Solutions today for a quote.
About Craig Green
Craig Green is the managing principal at G2 Energy Solutions, an energy engineering consulting firm based in Phoenix, Arizona. Over the last decade, Craig has helped project teams save millions of dollars through the performance path code compliance process over many projects.
For questions on the article or to discuss working with G2 Energy Solutions, please contact Craig at 480-637-7900 or craig.green@g2energysolutions.com.
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