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Staff Report #: 19 -187 -CC These findings are included in Attachment A. If Reach Codes involve energy requirements, cities/counties need to file an application to the CEC to prove that any local amendments related to the energy code are cost effective and save more energy than those required by the state. This is done through submitting a cost effectiveness study to the CEC. Cost effectiveness study results The studies and memorandum in Attachment E, F, and G present the research and cost effectiveness analysis of various building prototypes with different Reach Code options. The studies act as tools for communities to select different Reach Code options ranging from increased energy efficiency to all -electric requirements. For Menlo Park, the studies provide evidence that the proposed electric requirements for new buildings and solar production are cost effective. Table 2 highlights the estimated cost savings between new all -electric and natural gas buildings. Table .- gas building prototype Construction savings OperationalBuilding savings Single family home Up to $5,349 $4,416 Multifamily- three stories or less (per dwelling unit) Up to $2,337 $1,864 Office $82,330 $52,738 Retail $24,111 $22,661 Hotel $1.3 million $1.24 million A majority of the cost savings is experienced upfront in the construction phase by avoiding the cost to install natural gas infrastructure. Additionally, building operational savings was calculated using time dependent valuation (TDV.) TDV was developed by the CEC to reflect time dependent value of energy including the long-term projected costs of energy, such as the cost of energy during peak periods. It also provides a value for GHG emissions produced/reduced as part of the calculation. TDV is expressed as the overall lifecycle savings of a building, which for the purposes of the study is 15 years for residential and 30 years for nonresidential. If peak demand costs and greenhouse gas costs are removed from TDV, the cost to operate single-family, multifamily, offices and hotels would be increased. However, there are other important local factors to consider that would further reduce operational costs. For example, Menlo Park's electricity provider, PCE, has slightly lower electricity rates than the PG&E rates used in the cost effectiveness studies. Additionally, the studies used the lowest energy efficient appliances allowable under federal law for the building prototypes. There is higher energy efficient and cost effective appliances available on the market that would further reduce utility bill costs for customers. In addition, producing on-site solar as required under the proposed Reach Code for new buildings would further reduce operation costs. Based on Menlo Park's PCE rates, nonresidential/high-rise residential on- site solar requirements, and higher energy efficient appliances available, the expected average annual utility bill would be much lower than projected in the cost effectiveness studies. Also, the addition of the prewiring requirement directed by City Council is considered to be cost effective. The supplemental memorandum from TRC (Attachment G) confirms that the cost to pre -wire for stoves is City of Menlo Park 701 Laurel Sl., Menlo Park, CA 94025 tel 650-330-6600 www.menlopark.org