Texas Department of Housing & Community Affairs - Building Homes and Strengthening Communities

TDHCA Proposed Energy Efficiency Rule

Energy Efficiency Measures in TDHCA Single Family Programs

The purpose of the proposed sections is to set forth Minimum Energy Efficiency requirements for new construction, reconstruction, and rehabilitation activities in Single Family Programs in accordance with Texas Government Code §2306.187. §2306.187 requires the Department to develop a rule relating to the minimum energy efficiency requirements for construction activities in the Department's Single Family Programs, including housing rehabilitation.

Additionally, Chapter 388 of the Health and Safety Code provides authority to adopt energy conservation codes to the State Energy Conservation Office (SECO).

SECO, through the Texas Administrative Code (34 TAC §19.53), adopted Chapter 11 of the 2009 IRC as the energy code for the State of Texas and was made effective on January 1, 2012.

New construction and reconstruction activities supported through the Department's Single Family Programs shall comply with either Chapter 11 of the 2009 IRC or be Energy Star certified.

The measures identified in rehabilitation projects are typical measures that can be affordably completed on existing housing.

Home Energy Efficiency Measures Enhance Home Affordability and Benefits Everyone

The Department's proposed single family home energy efficiency requirements, which become effective in late 2014, will apply to all new affordable single family home construction and home rehabilitation activities supported through TDHCA's Single Family Housing Programs.

The new requirements are designed to enhance home affordability by reducing household utility costs. This is particularly important to lower income households who typically spend on average between 20% - 25% of their after tax income on utility bills. Meanwhile, households earning more than 80% AMFI typically spend between 3% - 5% of their after tax income on utility bills.1 In essence, the lower the household income, the higher the percentage of after tax income spent on utilities.

Texas Family Energy Costs as Percent of After-Tax Income

Less than $10K: 68%; $10-30K:23%;$30-50K:16%;$50K+:8%
Source: Energy Cost Impacts on Texas Families. American Coalition for Clean Coal Electricity. February 2013.

About Home Energy Efficiency

Energy-efficient features offer better protection from cold in the winter, heat in the summer, air drafts, moisture infiltration. Energy efficient homes use significantly less energy for heating, cooling and water heating. The savings have proven to be between 20%-30% per year on energy bills.

Household Benefits of Home Energy Efficiency

According to the US Environmental Protection Agency, implementing home energy efficiency measures can help households reduce their annual energy bills by an estimated average of $750.2

An affordable, energy efficient home offers low- to moderate-income households the benefits of lower utility bills, a healthy living environment, and the ability to redirect limited funds toward other costs, such as food and medicine.

Helping the state's lower income households meet their utility costs and avoid a potential health or financial crisis can help them achieve greater self-sufficiency and financial stability in the long term.

Community Benefits of Home Energy Efficiency

The integration of home energy efficiency measures into the Department's single family programs may be realized locally through enhanced economic stability.

The "Home Energy Efficiency and Mortgage Risks" study, released in March 2013 by the University of North Carolina and the Institute for Market Transformation, found that the risk of mortgage default is one-third lower for Energy Star certified homes.

Statewide Benefits of Home Energy Efficiency

Home energy efficiency benefits everyone by decreasing the demand on the state's electric grid, and reducing greenhouse gas emissions.1

The Department has similarly integrated energy conservation into its affordable multifamily housing development programs, per statute.

1. In 2005, the typical U.S. family with an annual after tax income of $52,000 spent nearly 9% of its budget on utility bills. The 61 million families (the majority of U.S. households) that earn less than $50,000 annually devoted nearly 20% of their after tax income on utility bills. Source: Building Energy Star Qualified Homes, HUD, 2008.

Texas households with incomes of below 50% of the Federal Poverty Level pay 74.4% of their after tax income on utility bills. According to the 2000 Census, more than 489,000 Texas households live with an income at or below 50% Federal Poverty Level. Source: On the Brink: 2011. Fisher, Sheehan & Colton, Public Finance and General Economics, Belmont, MA, 2012.

In 2012, American families earning less than $10,000 a year spent 78% of their after tax income on utility bills; families earning between $10,000 and $30,000 spent 24%; families earning between $30,000 and $50,000 spent 17%. Source: Energy Cost Impacts on American Families, 2001-2012. American Coalition for Clean Coal Electricity. February 2012.

2. http://www.epa.gov/statelocalclimate/local/topics/residential.html


Documentation and Resources

10 TAC 21: Minimum Energy Efficiency Requirements for Single Family Construction Activities

For New Construction and Reconstruction, a new home must comply with Chapter 11 of the 2009 IRC, 2009 IECC, or Energy Star Certification.

Only Residential Energy Services Network (RESNET) certified Home Energy System Raters (HERS Raters) can inspect and test for Energy Star Qualified homes.

All appliances, equipment, and fixtures installed or replaced shall be Energy Star or WaterSense certified products.