New York City Ramps Up Energy Efficiency Requirements for Building Owners

Last week, New York City Mayor Bill de Blasio announced an unprecedented mandate for the city’s large buildings to meet strict targets for reductions in greenhouse gas (GHG) emissions, backed by financial penalties for companies that fail to comply.

Based on the targets set in the Paris Agreement—the international pact to reduce GHG emissions by 80% by 2050—New York’s new initiative aims for a 7% reduction in city-wide emissions by 2035. To accomplish this, the city is establishing caps on fossil fuel consumption for all buildings larger than 25,000 square feet, with penalties for exceeding these caps commensurate with building size. Here is a breakdown from the announcement issued from the mayor’s office:

For example, a 30,000 square foot residential building operating substantially above its energy target would pay $60,000 for every year over the standard, starting in 2030. A one million square foot building operating well over its energy target would pay as much as $2,000,000 for every year over target. Failure to comply will also affect a building’s ability to receive future permits for major renovations.

Specifically, the initiative is pushing for building owners and operators to upgrade “boilers, heat distribution, hot water heaters, roofs and windows,” and aims for a 14% reduction in natural gas use and 20% reduction in fuel oil use by 2035.

This focus on emissions reduction through building improvements puts an emphasis on "building energy drift," or the natural degradation of energy efficiency in a building as design flaws, construction defects, and malfunctioning equipment go unnoticed. Researchers from Texas A&M University and the Department of Energy’s Lawrence Berkeley National Laboratory estimate that this kind of drift can cause as much as 30% degradation in energy efficiency in a two-year period. Controlling this kind of drift requires constant analysis of operational and energy consumption data to identify anomalies in equipment performance before they drive up energy waste. In New York City, the threat of penalties for fossil fuel use makes this even more important.

The language in Mayor de Blasio’s announcement also suggests that this is a sign of an impending nationwide trend—aggressive legislation on energy efficiency at the local level. Since the Trump administration declared its intention to withdraw the US from the Paris Agreement, a separate coalition led by California Governor Jerry Brown and former New York Mayor Michael Bloomberg has gathered 9 states and 227 cities and counties committed to upholding the agreement at the state and local level. To bolster this commitment, the coalition is also working with outside experts to measure the potential impact of these member states and cities.

While New York City is the first city to issue such aggressive mandates for greenhouse gas emissions in its buildings, it is not likely to be the last.

This strategy brief lays out how these trends are forcing businesses to think differently about energy
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Authored By Kevin McSweeney

Kevin McSweeney is Enel X’s Regional Manager for Energy Intelligence Software.

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