Building Energy Performance Program
In April 2019, the New York City Council passed Local Law 97 as part of the Climate Mobilization Act, impacting buildings larger than 25,000 square feet. A few months later, Philadelphia followed suit, passing a similar bill for the creation of the Building Energy Performance Program, impacting buildings over 50,000 square feet. Both acts serve as a commitment to cut greenhouse gas emissions by at least half over a near term horizon.
The expectations are that the existing buildings will improve their energy efficiency, decreasing the consumption of energy and greenhouse gas emission as a result. But what do the acts mean for the owners and operators of buildings in these cities?
In order to meet these requirements, building owners and operators need to determine the timing based on the size of their building and take actions to assure proper upgrades are made to meet the requirements and defined timelines.
In short, they need to consider the potential impact of the published regulations to meet the mandated energy efficiency standards set out by the acts. For example, Philadelphia requires non-residential buildings with more than 50,000 square feet to submit high-energy certificates or tune their energy systems to proper usage levels.
Given the cost savings and environmental benefits, energy efficiency has evolved into a highly valuable and integral element of property and asset management.
According to the U.S. Energy Information Administration, building energy consumption accounts for up to 40 percent of all energy consumption in the US. Depending on the efficiency of the buildings, costs associated with energy can account for a significant portion of recurring monthly expenses for many businesses. The new energy efficiency requirements passed by New York City and Philadelphia can result in a cost savings of 5 to 30 percent savings on utility bills alone.
By upgrading current buildings in these markets, building owners can see savings in the costs incurred for ventilation, cooling, heating, and lighting. In turn, operational costs are reduced, and fewer maintenance requirements may be needed. Apart from cost savings, energy efficiency will increase tenant or buyer demand, leading to increased prices and rents, making the property more attractive buy or lease.
On the other hand, energy use improvements usually require a significant upfront investment. For some efficiency upgrade projects, payback periods can often be less than two years. Some businesses can take advantage of creative financing options, coupling their upgrades with rebates and incentives, depending on location and programs available. When considering your options for these types of improvements, it may be beneficial to speak with a company who specializes in the strategy and implementation of energy-efficiency projects for maximum recognition of savings.
Social and Health Benefits
While the relationship between energy efficiency and occupant well-being is complicated, upgrades can provide several social and health benefits. Implementing energy-efficient policies translates to better air quality within the building and an overall decrease on energy demand. This ultimately allows less dependence on fossil fuel energy production.
On average, energy efficiency interventions lead to substantial improvements of the building operations and improvements to the overall health of occupiers. The well being of the people within these buildings can make a compelling case to implement energy improvements – just as the value enhancement of the building and economical cost-savings.
As we ponder the relationship between value, sustainability and energy efficiency, you must consider the impact each improvement will have on cost-savings and the physical and mental well being of everyone in the building. Further, as we migrate to a green energy economy, we need to consider all aspects of our energy use and the impacts on the user of real estate properties.
Dailey Tipton is the Vice President of Sales and Marketing for Evolution Energy Partners, a full-service Energy Management, Engineering and Consulting firm offering Best in Class Sustainability, Energy Efficiency, Procurement, and Analytical solutions. For more information about the energy efficiency projects and cost savings through energy management, contact Dailey Tipton firstname.lastname@example.org or learn more about Evolution Energy Partners by clicking here.