Bloomberg Pushes Energy Efficiency Laws for New York Buildings

Legislation Would Require Energy Benchmarking and Some Retrofits

April 30, 2009

New York City Mayor Michael Bloomberg announces a plan to reduce energy in the city's existing buildings. [Photo/Spencer T. Tucker]

Updated 9:55 AM ET

| The owners of tens of thousands of New York City’s largest buildings would be required to conduct energy audits and make energy efficiency retrofits under a sweeping package of green building laws announced last week by New York City Mayor Michael Bloomberg.

The provisions, which were introduced on Earth Day in four separate bills to the City Council, would also require building energy benchmarking and rewrite commercial lighting standards and parts of the city’s energy code. They will “do more to shrink our own direct impact on global warming than any other action we can take,” the Mayor said at a press conference announcing the initiatives.

He called the measures a “shot in the arm” for the city’s tepid economy, projecting $750 million in energy cost savings annually for property owners through lower utility bills and more than 20,000 new jobs in the construction and energy auditing fields.

Many recent initiatives have promised to create green jobs, but “this is a plan that will really do it,” he said.

New York City Council Speaker Christine Quinn, appearing later in the day on The Charlie Rose Show with the mayor and Sierra Club Executive Director Carl Pope, said council members are “very excited about moving these bills into law as quickly as we can.”

The mayor’s boldest measure would mandate energy audits in buildings larger than 50,000 square feet once every decade and require retrofits that are deemed cost effective, which is defined as a five-year payback period. Building owners would have control over what retrofits they choose to implement and could forego efficiency investments that are too costly, city officials said.

The law would take effect in 2013, however the mayor pledged financial incentives for property owners to begin work as soon as possible.

Buildings that have earned the government’s Energy Star label in prior years or achieved LEED certification would be exempt, according to the bill.

Separately, property owners would be required to benchmark the energy usage of their buildings, which would likely be made available publicly, similar to a new law in the District of Columbia. The legislation would also force commercial lighting upgrades in buildings by 2022 and require owners to comply with a new energy code after completing a building renovation of any size. Renovations that comprise less than half of a property are currently exempted from new code compliance, which city officials called a major loophole.

In a statement, former Vice President Al Gore called the legislation “crucial” to reducing reducing greenhouse gas emissions.

“By seeking efficiencies in existing buildings, New York can make a real difference in carbon emissions, and hopefully bring us a step closer to solving the climate crisis,” he said.

Forcing improvements to existing buildings will also create a new market for energy-efficient building technologies, Pope said.

To support the legislation, Mayor Bloomberg said the city would provide job training assistance and release $16 million of stimulus money to provide financing for retrofits, money that would “prime the pump for private financing.”

Credit remains a problem, he said, and the city is “not oblivious to that fact.”

The measures, which are being packaged in the mayor’s PlaNYC environmental initiative, are expected to trim the city's carbon emissions by 5 percent, or the equivalent of offsetting all of the carbon emissions from a city the size of Oakland, Mayor Bloomberg said. The buildings that are being targeted -- those of 50,000 square feet or more -- comprise half of the city’s floor space and almost 50 percent of its total energy consumption, according to city estimates.

Buildings account for 80 percent of New York City’s carbon emissions, a figure that is substantially higher than in other cities. For that reason, energy efficiency retrofits have been “on the mayor’s radar for quite a while,” said Stephen Del Percio, a construction and real estate attorney with Arent Fox LLP in Manhattan who writes a blog about green building activities in the city.

“It doesn’t surprise me at all that he’s moving in this direction,” he said.

Overall, the legislation signals a new thrust by lawmakers to target existing buildings, which was unfathomable just a few years ago but has benefitted from new case studies that indicate retrofits are good short-term investments.

At the Empire State Building, a massive renovation that is already underway is cutting energy consumption by almost 40 percent and will turn profitable in less than five years, project officials and the building's owner, Anthony Malkin, said earlier this month.

Yet, most green building legislation to date has focused on new construction, which environmental groups say is shortsighted.

“Literally billions of square feet of New York real estate could be harnessed to solve global warming in ways that also save families and businesses money on their energy bills,” Fred Krup, president of the Environmental Defense Fund, said in a statement. “New York City is offering a game-changer in the effort to cut energy demand and carbon emissions from America’s buildings.”

Eighty-five percent of New York’s 1 million buildings will be in active use for at least the next 20 years, Mayor Bloomberg said.

“While many people think of green buildings as being new buildings, the fact is that making existing buildings more energy efficient is the key challenge,” he said.