Here comes net zero energy
The new energy standards law implemented by the state of California on Jan. 1 to achieve “zero net energy use” — a measure known as Title 24 — will certainly add to the cost of doing business for building material companies, but should provide long-term benefits, industry experts said.
While one executive initially thought of Title 24 as “yet another goofy” California regulation, others viewed it favorably.
Augie Venezia, president of Fairfax Lumber & Hardware in Fairfax, Calif., told HBSDealer it’s a “net positive” for the industry.
“Buildings will be more comfortable, healthier to live and work in and cost less to operate,” said Venezia, who has turned Fairfax into one of the leading green building material suppliers. “The goal will be to design structures with the added energy efficiency features that will cost more up front but the resulting savings in the long run will offset the short-run costs.”
Venezia said the new measure will elevate sales staffs to operate more like consultants as opposed to order takers — “making our industry more professional and attractive to new talent.”
“The real problem is how do we incentivize the retrofit existing buildings to meet new standards so it makes sense economically without forcing undo hardships,” Venezia added.
Title 24, short for California’s Building Energy Efficiency Standards Title 24, Part 6, was set forth by the California Energy Commission to conserve electricity and natural gas consumption throughout the state. The latest code updates are intended to support the state’s goals of achieving zero net energy use in new residential buildings by 2020 and in new commercial spaces by 2030. A zero net energy building produces as much energy as it consumes, usually through a mix of high efficiency and clean onsite generation. To manage consumption, Title 24 sets efficiency regulations on building features such as materials, lighting and appliances.
Dave Cogdill, president and CEO of the California Building Industry Association, said he believes the CEC “has established a solid balance between the need to reduce energy consumption with the need to limit increased construction costs.”
For pro dealers, the issue is largely a matter of stocking and selling products that are in compliance — as well as guiding customers through the process. But accroding to Ken Dunham, executive director of the West Coast Lumber & Building Material Association, based in Folsom, Calif., managing the complex web of rules won’t be easy.
“The thing is every one of these counties in California has slight variations in how they write codes, and I know that it is even crazier in southern California,” Dunham said.
The CEC said the benefits of Title 24 would be felt in the following areas:
- Attics: Extra insulation at the roof deck in addition to ceiling insulation will reduce the attic temperature by 35 degrees or more during hot summer days.
- Walls: Builders can choose from many different assemblages to reduce heating and cooling needs in the home year round.
- Lighting: Installation of high quality lighting with controls that nearly halves the energy required for lights in new homes.
- Water heating: Installation of tankless water heaters that reduce use by about 35 percent.
- Envelope: Revise outer building, or envelope, requirements for all nonresidential and high-rise residential buildings.
- Lighting: Update power for lights to align with the American Society of Heating, Refrigerating and Air-Conditioning Engineers standards.
- Elevators: Require lights and fans to shut off when an elevator is empty.
- Escalators and moving walkways: Require escalators and moving walkways in transit areas to run at a lower, less energy-consuming speed when not in use.
- Windows and doors: Require lockout sensors that turn off cooling and heating systems if a door or window is left open for more than five minutes.
Such rules will generally add costs to construction, while providing savings over the the long term. (One report estimates an extra $2,500 to $3,000 up front, with much bigger savings projected over 30 years.)
“I think the goals and objectives of Title 24 are noble,” said Eric Ziedrich, owner of Healdsburg Lumber Co. in Healdsburg, Calif.
However, Ziedrich said he is concerned about the intitial costs, espeically as California struggles with housing affordability.
Vennezia’s viewpoint is on the side of the optimists. Builders may soon be able to capitalize on the value proposition of energy savings, and the trend could be fueled by economics, as opposed to mandates.
“The bottom line is: Energy efficiency doesn’t just make sense for high-end jobs. It’s for everybody.”
Andersons exits the retail business
Maumee, Ohio-based The Andersons Inc. is closing its retail division, which operates four Ohio big box stores with a heavy home-improvement focus and the slogan: “A Store Like No Other.”
The diversified company will continue to run its grain, ethanol, plant and rail operations, but it will exit the retail business and close its remaining four stores in the second quarter of 2017, the company announced.
Two of the stores to be closed are located in the Toledo area (including a Maumee store), the others are in the Columbus area.
The company’s original Warehouse Market opened in Maumee in 1952. Today, the stores measure about 140,000 square feet and carry 125,000 SKUs.
During the past eight years the company’s retail group has incurred pre-tax losses, including previous asset impairments, in excess of $20 million and closed three stores.
"The decision to close The Andersons stores was not easy for anyone involved," said CEO Pat Bowe. "Choosing to cease a business that has spanned 65 years and employs about 1,050 people is tremendously difficult."
The closing will eliminate approximately 650 positions in the Toledo area and 400 positions in Columbus, of which approximately 75% are part-time positions.
Product lines in the Andersons retail empire ranged widely, and the moniker “General Store,” was often used to describe the operation. Store departments include food, automotive and footwear, as well as home projects, tools and hardware and outdoor living.