Despite the U.S withdrawal from the Paris Agreement, 12 of the largest U.S. cities—and members of the C40 Cities Climate Leadership Group—have reaffirmed their commitments to implementing ambitious climate action plans aligned the latest climate science., These forward-thinking cities include: Austin, Boston, Chicago, Houston, Los Angeles, New Orleans, New York City, Philadelphia, Portland, San Francisco, Seattle and Washington D.C.
On April 18th 2019, New York City took another major step in advancing the U.S. municipal response to climate change with the approval of the Climate Mobilization Act, a set of seven bills representing unprecedented changes that will deliver over 80% reduction in emissions by 2050. The legislation will impact all buildings over 25,000 square feet and come with the potential for hefty fines.
The big question is: how does this landmark legislation impact landlords, management companies and tenants?
Below we answer this question with a focus on the most aggressive mandate of the legislation: Introduction 1253.
Introduction 1253 – The Basics of the Building Carbon Emissions Law
Introduction 1253 sets emissions intensity caps in 2024-2029 and 2030-2034 for buildings over 25,000 square feet. Limits vary by Building code occupancy groups:
Building Carbon Emissions Limits
The 2024-2029 limits were designed to cover the 20-25% highest carbon emitting buildings. About 75-80% buildings are already in compliance for 2024 Limits from 2030-2034 are designed to affect approximately 75% of the most carbon-intensive buildings.
When does this go into effect and what is the requirement?
Starting in May 1, 2025 (and every May thereafter) covered buildings will be required to submit a report showing their carbon emissions.
What are the potential penalties?
The legislation outlines three types of violations:
- Exceeding Emissions Limits: Calculated by multiplying your building’s emissions overages by $268.
- Failure to file report: Calculated by multiplying your building’s gross floor area by $0.50, for each month that the violation is not corrected within the 12 months following the reporting deadline.
- False statement (misdemeanor): $500,000
Where to begin?
Before knowing where companies want to go, they must know where they are. The most recent benchmarking data submitted for Local law 84/133 is a good starting point. Calculate emissions by multiplying energy consumptions (e.g. natural gas, electricity, steam or fuel oils) by their corresponding carbon intensity factors:
Then, compare it to building occupancy group emission limits. For mixed occupancy buildings, use the one representing the largest square footage.
- If under the emission limits: Congratulations! Continue innovating building operations.
- If above the emission limits: At least 75% of buildings should be in compliance with the 2024 limits but not as many with the 2030 limits. If that’s the case, start thinking about a carbon reduction plan to include energy efficiency and renewable energy goals. NYC has lucrative incentive programs to offset costs, so now is the time to put together an action plan.
Meet Targets with Energy Efficiency Strategies
- Low Cost Operational Changes – conduct Retro-commissioning or Energy Audit studies to identify opportunities for high-ROI savings through analysis of existing equipment, and controls sequences.
- Capital improvements – explore opportunities to add controls-based hardware to optimize/automate scheduling and equipment run time, upgrade existing lighting infrastructure, improve the building envelope, or investigate financing for large-scale HVAC replacements
- Remote Monitoring – Use software tools like EcoStruxure™ Building Advisor, Resource Advisor, and Microgrid Advisor to track portfolio building performance, conduct remote commissioning on building HVAC systems, and highlight opportunities for demand response and renewable energy programs
Meet Targets using Renewable Power
A major component of achieving this ambition reduction plan is renewable energy. Incentives and policies such as those listed below show NYC and New York state’s commitment to renewable power. Schneider Electric is poised to assist companies achieve reductions and lead as a renewable energy adopter.
New York’s Reforming the Energy Vision (REV) program launched in 2014 fosters a clean, resilient, and affordable energy system in New York. REV’s key targets include 50% of electricity from renewable sources as well as reducing emissions by 40% from 1990 levels, both by 2030.
New York’s Clean Energy Standard (CES), which replaced the state’s Renewable Portfolio Standard, mandates that load-serving entities (e.g., utilities) procure Renewable Energy Credits (RECs) and zero-emission credits (ZECs) to achieve the state’s 2030 renewable energy goal. Nuclear fission generation is an eligible source of ZECs.
Schneider Electric’s Environmental Attribute procurement team is at the ready to help procure RECs for corporate entities as well.
The Value of Distributed Energy Resource (VDER) tariff is the new net-metering policy to be phase in by January 2020. It will stack the value of energy produced, capacity mitigated, environmental attributes generated, and demand reduced. Take advantage of onsite assessments to see if a specific facility is a good candidate.
What about the limits beyond 2035?
No later than January 2023, building emissions caps applicable for calendar years 2035 through 2039 and for calendar years 2040 through 2049 will be established. Such limits shall be set to achieve an average building emissions intensity of no more than 0.0014 tCO2e/sf/yr by 2050.
NYC has taken a major step toward strong climate action with this omnibus of bills, but competitive cities like Boston, DC and Chicago are closely following with new or refined legislation that moves the climate disclosure conversation from sharing to acting.
Stay tuned for more developments within the energy and carbon benchmarking landscape as municipalities ramp up efforts to prevent the worst of climate change.
And to learn more about how your city can lead by using renewable energy, we invite you to read this blog.