NYC Energy Efficiency Grades – Are you Getting a Good Grade?

Many property managers and owners don’t put a lot of thought into how energy-efficient their buildings are — until, of course, they start getting graded on it. Beginning in 2020, NYC Local Law 95 of 2019 will require ENERGY grades to be posted on every building over 25,000 square feet and listed on the NYC Covered Buildings List. These grades are based on Energy Efficiency and Water Usage.

So far, things aren’t going well.

About half of the roughly 40,000 buildings that had to post energy-efficiency grades received a D or lower (F scores were only given to buildings that didn’t comply). And while some well-known New York City landmarks are scoring A’s, others are performing quite poorly.

 

Will Building Owners Address Their Energy-Efficiency Shortcomings?

Right now, there is no fine associated with scoring poorly on energy efficiency. But that is going to change in 2024, when buildings will start to be assessed fees that could range into the hundreds of thousands for those that fail or perform poorly.

 

All of this is part of The Climate Mobilization Act which is New York City’s attempt to reduce emissions by at least 80% by 2050. The city’s buildings are responsible for almost 70% of the city’s carbon emissions due to their extensive heating, cooling, and lighting needs.

Of course, holding buildings to a certain standard is not a totally new concept. Just as restaurants are routinely inspected for cleanliness and given grades announcing their results, so too are buildings now being held more accountable. But whereas restaurants can request follow-up inspections from the Health Department to address sanitary issues, buildings will only be given a chance to lock in a grade once a year.

As such, the stakes are high — not just because of the upcoming fines, but because of the way poor energy performance could hurt a building’s reputation.

If a building is flagged as being notably not energy-friendly, it could be a turn-off for tenants — both residential and commercial. As such, buildings could lose revenue by virtue of having outdated systems.

But also, outdated heating and cooling systems cost buildings money, so it’s in property owners’ best interest to start investing in upgrades. A good place to start in this regard is an energy audit, where a professional comes in, inspects all systems, and makes recommendations that can be implemented to reduce energy usage.

 

In fact, it would be wise for New York City building owners to start that process now, well before fines start coming into play. That way, if there are extensive issues that need to be addressed, they can get started sooner rather than later.

 

The Bottom line

It will be interesting to see how buildings evolve considering this new energy-efficiency grading system, and whether other cities opt to follow suit in effectively forcing building owners to step up their game.

To know more about Compliance, Contact Us. We are a group of highly-skilled professionals offering various services such as NYC Local Law Compliance, Energy Audits, Building Commissioning, Retro-Commissioning and other GHG Emission Reduction Services.