As the frequency of extreme temperatures increases, so too will energy costs. Inevitably, the financial strain on hardworking families across the country will reach unprecedented levels. Inadequately insulated and cooled homes pose significant health risks, compounding the challenges faced by residents already burdened with high energy bills. In some cases, individuals are forced to endure uncomfortable and unsafe temperatures in a desperate attempt to reduce these soaring expenses. Building homes to updated energy codes not only protects vulnerable residents but also reduces the overall cost of housing in the country.

In Maricopa County, Arizona, the toll of extreme heat is evident, with over 645 heat-related deaths reported just last year—160 of which occurred indoors. Similar cases are appearing in states across the country, emphasizing the urgent need for federal action. While the Biden administration’s efforts to reduce housing costs, including energy costs, is praiseworthy, more can be done to reduce the burden on families.

Amidst these mounting challenges, the stability of our housing finance systems is under threat as homes become increasingly susceptible to energy price spikes in extreme temperatures and climate-disaster related damages. That and dwindling insurance coverage means the housing stock is increasingly at risk as residents struggle to keep up. Low-income residents and people of color in particular face heightened difficulties coping with those increasing costs, exacerbating existing financial burdens.  

However, our nation’s federal agencies, such as the United States Department of Housing and Urban Development (HUD), the U.S. Department of Agriculture (USDA) and the Federal Housing Finance Agency (FHFA),  have yet to to universally adopt modern building codes, a move that would significantly reduce costs and safeguard homeowners and renters.

FHFA’s acknowledgment of climate change as a significant threat underscores the urgency of proactive measures to address this issue. Energy-efficient homes are essential for mitigating risks and ensuring long-term affordability and resilience.

Still, 65 percent of counties, cities, and towns across the U.S. have yet to adopt modern building codes, emphasizing the need for swift action. By implementing up-to-date energy codes, we can reduce energy bills with the added bonus of enabling residents to stay in homes longer during extreme temperature events that may disrupt power, offering crucial support to vulnerable communities.

In states like Texas and Arizona, where escalating heatwaves, cold snaps, or price spikes strain the finances of many households, there’s no time to wait to take action to protect and help keep them in their homes. Fortunately, we have a policy option that will help us mitigate risks and bolster the resilience of our homes and communities. 

By supporting the Campaign for Lower Home Energy Costs, we’re joining a growing movement of advocates, policy experts, and citizens calling on HUD, USDA, and FHFA to  improve the safety of homes in extreme weather, and act to protect residents from high costs and risk of loan default, all while reducing greenhouse gas emissions and other pollution.

To reduce financial burdens and enhance resilience, a key first step is to require that new homes backed by loans from those agencies adhere to the latest model energy codes. Studies show that homes built to the most recent model energy codes provide residents with lower energy burdens and better survivability during extreme temperatures. 

Recently, a coalition of banks, credit unions, and other lenders, penned a letter to FHFA expressing support for adopting updated energy codes for newly constructed homes backed by Fannie Mae and Freddie Mac , which guarantee nearly half of new home mortgages each year. 

Federal agencies should adopt proposed home energy efficiency measures as soon as possible for the sake of the health and finances of working families nationwide. Prioritizing energy-efficient home construction and modernizing building energy codes is key to a sustainable and resilient future. HUD, USDA, and FHFA, alongside other leading agencies, must swiftly implement these measures to safeguard our communities and promote housing equity. 

Together, let’s work towards a more secure and affordable future for all.

An update from Americans for Financial Reform Education Fund