of the existing building and industrial plant stock is thirty or more years old and employs older technologies. Therefore assessing externalities associated with future energy use needs to consider the upgrading of existing systems (“retrofits”) as well as the introduction of new technologies. The America’s Energy Future (AEF) report Real Prospects for Energy Efficiency in the United States (NAS/NAE/NRC 2009d) has been used as a major resource for the materials presented in this chapter.

Residential building sector emissions are generally distributed in the same manner that population is distributed. Commercial buildings are located in urban areas and suburban towns and villages. Industrial-fuel use is more concentrated in industrial areas, and varies by industry. Because of differences in scale and characteristics of the combustion processes, local health effects and other effects will be somewhat different, and these are identified and discussed in general. Greenhouse gas (GHG) emissions enter a common atmosphere and are not sensitive to location of the emission. Other externalities may exist but are not quantified in this chapter.

The committee used the methodology of the Air Pollution Emission Experiments and Policy (APEEP), with all the caveats described in detail in prior chapters and in Appendix C, to assess damages related to energy use for heat in the buildings and industrial sectors. The primary fuel, natural gas, is estimated to have relatively low nonclimate-change damages per kilowatt-hour compared with coal or wood, for example. We have not estimated damages associated with home heating by coal or biomass fuels because they are a relatively small part of the total energy mix for that use and because recent trends in increased use of natural gas fireplaces are expected to reduce damages related to coal or biomass use for space heating. Only about 12% of U.S. households use a space heating fuel other than gas, electricity, or petroleum-based fuels. At present, there is no other primary energy source that can be readily substituted for natural gas on a wide scale to provide further reduction of such damages. Therefore, opportunities for future reductions of nonclimate-change damages from energy use for heat in the building sectors, in particular, are likely to occur mainly through the incorporation of energy efficiency in the building structures and heat energy systems, as well as the inclusion of localized energy technologies, such as solar thermal water heating or geothermal heat pumps.


Buildings in the United States consume about 39% of U.S. primary energy, although 73% of this energy is delivered in the form of electricity. The remaining 27% of the energy is primarily used for heating purposes. NAS/NAE/NRC (2009d) provides a detailed description of buildings in the residential and commercial sectors in the United States and describes

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