The issue particular to buildings is, as opposed to manufactured goods etc, buildings tend to stick around for quite a while and cost a lot of money for the bui

The issue particular to buildings is, as opposed to manufactured goods etc, buildings tend to stick around for quite a while and cost a lot of money for the build and a lot of money to operate. More than that, large capital outlays are required to reduce the operating costs by marginal amounts over the life of the building. Whenever you have a substantial delay between the outlay and the payback, market forces tend to be ineffective. Also, if we are talking energy costs, something like half the energy costs in buildings are in embodied energy - in the steel and concrete and materials used to build it. A broad scale energy tax would encourage reduction of upfront energy usage at the expense of long term operation. Any at the same time, may trigger the demolition of existing stock. Add to that most - something like 60-70% - building stock in the US is between 20-70 years old. If we take the example of making more efficient cars which started in the 80's, where the average age is less than ten years, we might expect to see the market delivering some real gains in building efficiency in 100 years or so.. Like it not, sometimes inefficient rigid standards are all we have. The standards are there to account for deficiencies in client requirements (or knowledge). There may be much better mechanisms to do this - one which better targets both the technical and motivational factors in energy reduction. But at the end of the day in an uninformed and long delay market, a blunt market mechanism is not it.