City Drops Mandatory Retrofits But Passes Greener, Greater Buildings Plan

Earlier today, the City Council passed the four pieces of legislation which Mayor Bloomberg introduced last April as his "Greener, Greater Buildings Plan." As you'll recall, building owners immediately opposed one of the bills (Int. 967: Audits & Retrocommissioning), which would have required them to implement a bundle of energy efficiency upgrades with a payback period of less than five years after the results of a rolling audit process. While auditing remains part of the approved legislation, owners will not be required to make the improvements, which will now just be identified based on a "reasonable" payback period. Public buildings, however, must still install any retrofit measure that the audit pegs with less than a seven-year payback. Although the costs of auditing were noted by opponents to the bills earlier this year, mandatory energy audits are now required every ten years, though buildings certified under LEED-EB and Energy Star are exempt.

The other three bills are Int. 564: New York City Energy Conservation Code, Int. 476: Benchmarking, and Int. 973, Lighting Retrofits and Submetering. This latter piece of legislation is particularly important to note from a leasing perspective; increasing the data available to landlords and tenants about how energy is being used in multi-tenant commercial buildings should assist brokers and attorneys in crafting provisions that address the split incentive, as well as encourage tenants (who will receive a monthly energy use statement) to reduce their overall consumption. Even with the revisions, bill sponsor James Gennaro and the city's long-term planning and sustainability director Rohit Aggarwala are calling the legislation "the single most aggressive environmental plan undertaken by any American city." The legislation is significant and we're looking forward to watching its implementation and ultimate impact in the marketplace as we move into 2010.