Labor and Business Coalition Comments Opposing the Proposed CR-102 Washington State Commercial Energy Code

August 4, 2026

Washington State Building Code Council

P.O. Box 41449

Olympia, WA 98504

DELIVERED VIA: sbcc@des.wa.gov

Re: Labor and Business Coalition Comments Opposing the Proposed CR-102 Washington State Commercial Energy Code

Dear Chair and Members of the Washington State Building Code Council:

On behalf of a broad coalition of Washington labor unions, businesses, employers, commercial property owners, industry organizations and business associations, we respectfully submit these comments regarding the proposed Commercial Energy Code amendments currently under consideration through the CR-102 rulemaking process.

Our coalition represents businesses that collectively employ thousands of Washington workers and invest billions of dollars in commercial buildings, manufacturing facilities, restaurants, hotels, healthcare facilities, warehouses, agricultural operations, retail establishments, office buildings and other commercial properties throughout the state.

We support practical, cost-effective improvements in building energy efficiency and recognize the important role the State Building Code Council plays in developing energy standards. However, we are deeply concerned that many of the current CR-102 proposals move beyond improving building energy performance and instead create significant new financial and operational burdens for Washington businesses and workers.

The cumulative effect of these proposals would substantially increase the cost of constructing, renovating, maintaining and operating commercial buildings while limiting the flexibility businesses need to make sound investment decisions.

Washington employers and workers are already facing significant economic challenges, including higher interest rates, inflation, rising labor costs, increasing insurance premiums, supply chain uncertainty and escalating energy costs. The proposed Commercial Energy Code would add another layer of regulatory costs at a time when many businesses are delaying or reconsidering investments because of economic uncertainty.

Our coalition is particularly concerned that several proposals fundamentally change routine equipment replacement.

For decades, businesses have been able to replace aging HVAC systems and commercial water-heating equipment with comparable equipment when those systems reach the end of their useful lives. Several CR-102 proposals would instead require major electrical upgrades, redesigned mechanical systems, expanded engineering, additional permitting and significantly larger capital expenditures simply to replace existing equipment. Routine maintenance should not become a major construction project.

For businesses, these requirements create consequences well beyond construction costs. Delayed equipment replacement can interrupt business operations, postpone tenant improvements, reduce manufacturing productivity, delay project completion and prevent restaurants, hotels, healthcare facilities, and other businesses from serving customers. Downtime translates directly into lost revenue, reduced productivity, and higher operating costs.

We are also concerned that the proposed Commercial Energy Credit requirements exceed what is necessary to achieve legislative energy-efficiency objectives while significantly increasing project costs. Higher compliance costs ultimately discourage commercial investment, reduce the number of projects that move forward, increase the cost of commercial space, and negatively affect housing affordability, job creation and economic development throughout Washington.

The coalition of labor and business also believes the proposals affecting commercial cooking equipment, electric-readiness requirements and commercial water-heating systems deserve careful reconsideration.

Restaurants, hotels, institutional kitchens, healthcare facilities, food processors, manufacturers and many other commercial users depend upon equipment that best meets their operational requirements. Requiring unused electrical infrastructure, restricting commercially available equipment options or imposing penalties based solely on fuel choice increases costs without necessarily improving building energy performance.

Additionally, we are concerned that proposals effectively banning the use CMU blocks as “Mass Walls” eliminates the most effective and cost-efficient and resilient way to build masonry walls and is a cost-effective and resilient solution for many buildings. It will cripple and perhaps shut down an entire industry while increasing commercial construction costs.

Collectively, many of these proposals appear to shift the Energy Code away from its traditional purpose of establishing performance-based building standards and toward prescribing preferred technologies. The coalition believes Washington's Energy Code should remain technology-neutral, allowing businesses to meet measurable energy-performance objectives using the most practical, reliable and cost-effective solutions available. As summarized in the accompanying analysis, several proposals also raise significant questions regarding consistency with the federal Energy Policy and Conservation Act (EPCA) because they appear to influence or effectively dictate the selection of federally regulated appliances rather than regulating building energy performance. Those concerns deserve careful consideration before final action is taken.

Washington's economy depends upon continued private investment. Businesses considering whether to expand, renovate existing facilities, build new locations, or locate projects in Washington carefully evaluate regulatory costs and permitting requirements. Policies that unnecessarily increase capital costs, delay projects, reduce operational flexibility, or create uncertainty ultimately weaken Washington's competitive position relative to neighboring states.

For these reasons, our coalition respectfully urges the Council to:

• Restore like-for-like replacement of HVAC and commercial water-heating equipment during alterations and equipment failures.

• Revise the Commercial Energy Credit requirements so they achieve legislative efficiency goals without imposing disproportionate costs or favoring specific technologies.

• Remove penalties that disadvantage efficient natural gas supplemental heating or other federally compliant equipment.

• Eliminate unnecessary electric-readiness mandates that increase construction costs without providing measurable energy-efficiency benefits.

• Preserve multiple technology pathways that allow businesses to comply with performance standards while selecting equipment appropriate for their operations.

• Maintain a technology-neutral Commercial Energy Code that prioritizes affordability, measurable energy performance, reliability, practicality and Washington's long-term economic competitiveness.

• Protect the use of strong, efficient and affordable CMU Walls in new construction by denying the overreaching and non-scientific proposals 24-GP-264R and 256.

Our coalition believes Washington can continue to lead in energy efficiency while also supporting economic growth, housing affordability, business investment and family-wage jobs. Those goals are complementary—not mutually exclusive. We respectfully ask the Council to adopt a Commercial Energy Code that balances environmental objectives with the practical realities faced by the businesses that employ Washington residents, invest in our communities, and help sustain the state's economy. Please see the attached documents with proposed code language that accomplishes these goals.

Thank you for your consideration of these comments and for your service throughout this important rulemaking process.

Respectfully submitted,

Washington Labor and Business Coalition for Affordable, Reliable and Competitive Energy

On behalf of Washington labor unions, employers, workers manufacturers, commercial property owners, retailers, restaurants, hotels, contractors, builders, industry associations, agricultural businesses, healthcare providers, and other organizations committed to maintaining a balanced, affordable, and competitive commercial energy code.

(See below)

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