Denver launched a public process on Feb. 26 to update its energy code for new and renovated small buildings, including single-family homes and duplexes, that would extend efficiency and electrification-readiness standards that began with energy compliance goals for large commercial and multifamily buildings in 2023.

Denver’s 2021 Energize Denver ordinance required energy benchmarking and reductions for structures with 25,000 square feet or more.

As early as 2022, builders predicted the rules would raise housing costs and eventually reach single-family homes and duplexes.

In 2023, Laura Schwartz, spokesperson for Denver Community Planning and Development, told The Denver Gazette that “residential single-family homeowners and single-family home landlords don’t have to worry about the new commercial code requirements, which only apply to apartments, residential condominiums, and townhouses.”

Builders, including the Colorado Association of Home Builders, at the time warned that thousands of dollars in added construction costs per new home from emerging energy/electrification rules would have long-term impacts on supply and affordability as mandates evolve to cover more housing types.

“Energy mandates have a direct and measurable impact on the cost of constructing new homes,” Ted Leighty,CEO of the Home Builders Association of Metro Denver, said in a statement to The Denver Gazette. “We urge the city to recognize the clear connection between compliance costs and housing affordability and to ensure that future policies do not unintentionally make homeownership less attainable for working families.”

In 2023, the city banned new gas furnaces and water heaters in commercial and multifamily construction, starting in 2024, and by 2027, a full prohibition on gas heating and cooling equipment in commercial buildings.

Industry groups repeatedly warned of high costs and pushed back. Critics called the 2023 gas ban “painful and costly to building owners and tenants.”

Apartment associations, hotel groups, commercial developers, and restaurant owners sued Denver over the mandates, arguing that they violate federal law. Those suits are still pending.

Buildings account for nearly half of Denver’s greenhouse gas emissions, according to officials with the Office of Climate Action, Sustainability and Resiliency.

“Code updates like this one keep our rules and regulations modern, responsive and effective,” said Executive Director Brad Buchanan of Community Planning and Development in a release regarding the new process.

Executive Director Elizabeth Babcock of the Office of Climate Action, Sustainability and Resiliency called the update one of the most effective steps to cut carbon pollution and lower energy costs in the same release.

“Energy use in buildings is the largest source of Denver’s greenhouse gas emissions,” Babcock said. “Improving efficiency in new construction improves air quality, strengthens community health, and saves people money on their energy bills. This keeps Denver on a responsible path toward our climate commitments while ensuring homes and workplaces remain affordable and resilient.”

Leighty said the association looks forward to participating.

“The Home Builders Association of Metro Denver and its members look forward to participating in the Denver energy code update process,” Leighty said in the statement. “We are committed to engaging in a transparent, collaborative public process that welcomes input from all stakeholders and is not driven by a predetermined outcome for the city’s future energy policies.”

Leighty also stressed the importance of builder input.

“It is especially important that the city carefully consider the perspectives of the developers and builders who invest significant capital to meet Denver’s housing needs,” he said.

Dave Davia, president and CEO of Colorado Concern — an alliance of top business executives — welcomed the collaborative approach.

“We appreciate the city’s decision to engage industry experts in reviewing and updating Denver’s energy code,” Davia said. “A collaborative process is essential to developing standards that are thoughtful, transparent, and grounded in real-world experience. As the city moves forward, it will be important to ensure the updated code supports environmental goals while also protecting housing affordability, economic competitiveness, and long-term investment in Denver.”

Participation is open. Stakeholders and experts can apply to join committees or sign up for updates at DenverGov.org/energycode.