March 2010
In December 2009, New York City passed what experts regard as the most sweeping commercial building energy-efficiency legislation in the country. The package of mandates known as the Greener, Greater Buildings Plan will toughen energy-efficiency requirements for renovations, obligate most facilities to undergo energy audits every 10 years, and force buildings to update their lighting systems to more efficient technology. But the part of the plan likely to have the greatest significance nationwide is the requirement that all commercial buildings greater than 50,000 square feet benchmark and publicly report their energy use.
New York City isn't the first jurisdiction to require buildings to benchmark energy use. California started the race in 2007, requiring benchmarking and limited disclosure beginning Jan. 1, 2010. Washington, D.C., went further in 2008 by requiring phased-in public disclosure of energy use starting this year. New York City's 2009 legislation took another big step, mandating full compliance years ahead of the D.C. legislation for a far greater swath of facility types.
Meanwhile, other jurisdictions are looking at their own energy-use benchmarking and disclosure requirements. Directly on the heels of the New York City measure, Seattle passed its own energy-use benchmarking and disclosure law in January. As Seattle developed its benchmarking legislation, city officials kept tabs on what other jurisdictions were doing and collaborated with about 10 other jurisdictions that were also hashing out their own benchmarking initiatives, says Jayson Antonoff, sustainable infrastructure and green building policy advisor for the City of Seattle department of planning and development.
"Everyone should have it on their radar," Antonoff says. "I definitely see it becoming a national trend."
The New York City law could give a powerful impetus to that trend. With more than a million buildings spread across five boroughs, and a concentration of commercial high-rises unrivalled anywhere in the country, the city's action catalyzes energy benchmarking in the nation's largest real-estate market.
The Letter of the Law
New York City's benchmarking law is formally known as Intro. No. 476-A, Benchmarking Energy and Water Use. The measure requires commercial facilities of more than 50,000 gross square feet to benchmark their energy and water use each year, beginning May 1, 2011. City-owned buildings larger than 10,000 square feet must begin annual benchmarking by May 1 of this year. (For highlights of the other laws included in the Greener, Greater Buildings Plan, see "Landmark" below).
The benchmarked data will be submitted to the city via the U.S. Environmental Protection Agency's Energy Star Portfolio Manager tool, a free online benchmarking program. Failure to upload benchmarked data into Portfolio Manager is a "lesser violation" of the building code, meaning fines will be imposed. Data for commercial buildings will be available to the public on the tax assessment roll Web site and searchable by address starting Sept. 1, 2012, one year after data on city-owned buildings is due to be posted.
The disclosed data will include the facility's energy utilization index (expressed as BTUs per year per square foot), the water use per gross square foot, the Energy Star rating (if available for the facility type) and a year-to-year comparison of the facility's benchmarked data.
Before New York City acted, only Washington, D.C., required annual public disclosure of energy use data. Most other disclosure language like that of California pertains only to the parties involved during a sale or lease of a facility, and sometimes to current tenants.
Public disclosure of energy use has a two-fold rationale, says Rohit Aggarwala, director of the NYC Office of Long Term Planning and Sustainability (OLTPS). First, putting the energy benchmarking score on the tax roll makes energy efficiency an immediately visible asset to a prospective tenant or buyer. The Energy Star score should be "one of the first things that a potential tenant or purchaser looks at or thinks about," says Aggarwala. "And that makes energy efficiency a valuable component to a building in the market."
The second rationale is to drive performance through competition: "We will rely on the fact that real estate managers will be looking over each other's shoulders and the competitive nature of the real estate community will compel some people to tell their building staff, ΤThe other guy in a very similar building is doing much better than you are, so get your act together,'" says Aggarwala.
Because the city is directly involved in the benchmarked data reporting, there is an added component of oversight and accountability. The city will annually review the aggregate data. If there is an indication that the data is not being reported accurately, the city will evaluate whether further steps like training or more enforcement are necessary, says Aggarwala. |
