Any successful climate protection strategy must consider residential and commercial buildings, which are responsible for almost 40 percent of U.S. carbon dioxide emissions. From houses and hotels to schools and skyscrapers, buildings in the United States use about 40 percent of the country's energy for lighting, heating, cooling, and appliance operation. It is estimated that the manufacture, transport, and assembly of building materials such as wood, concrete, and steel account for another eight percent of energy use. About 30 percent of the electricity buildings use is generated from coal-burning power plants, which release greenhouse gases, causing climate change.

Because the energy demands of buildings are so large, designing and constructing energy efficient buildings can lead to large and vital reductions in energy consumption. Yet, despite remarkable improvements in the energy efficiency of individual components and appliances since the 1973 oil embargo, building energy consumption is increasing. New buildings are being constructed, a host of modern electronics and appliances are adding "plug load", and energy is simply wasted. New buildings typically are not designed to optimize energy performance, and most existing buildings have not been upgraded with even the most basic and affordable energy efficiency strategies. Home owners in general know little about how their homes use energy, and landlords often shift the burden of higher energy costs to their tenants by raising rental prices.

Fortunately, an increasing number of savvy home owners and commercial building owners understand that energy efficiency can save them hundreds or even thousands of dollars. Many building professionals know how to construct and renovate houses and other buildings to be energy efficient, green, high-performance, renewable-ready, and even completely independent of fossil fuels (such buildings are often referred to as zero-energy buildings). A variety of products are available, including super energy efficient Energy Star® appliances and HVAC systems, LED lighting, insulation, high-performance windows, and more. Bio-based building materials are also available to replace petroleum-based products. Last but not least, innovative financial mechanisms, such as on-bill financing, can help households upgrade the efficiency of their homes with no upfront payments.

The carbon reductions demanded by climate change require more than actions from individual actors, and policy changes have the capacity to propel the green building movement and greatly reduce the sector’s emissions. A variety of measures could be taken to ensure better buildings that are good for the economy––advanced building codes, voluntary standards to enhance building performance, home energy inspections, energy-efficient mortgages, financing tools, and more. States and cities are adopting green building rating systems or developing their own building policies to save energy and tackle climate change in the absence of major federal action.

The building sector could play a dramatic role in stabilizing atmospheric concentration of carbon dioxide (CO2), and the next generation of buildings could provide a wealth of collateral benefits such as improved affordability, health, safety, and resale value. As a complement to carbon pricing, policies that encourage or require buildings to be energy efficient and use renewable energy can reduce the building sector's demand for dirty energy and help the United States transition to a low carbon, clean energy economy that generates new businesses and jobs across the country.

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