Benchmarking Requirements Heads Up

 

NYC Local Law 84 Benchmarking filing requirements have now been expanded - effective January 1, 2018 with the addition of Local Law 133. The combination of LL 84 and LL 133 now require covered buildings that are 25,000 sf and larger to comply with Benchmarking filing requirements. Formerly LL 84 only covered buildings 50,000 sf and above. Now with the combination of these two Local Laws, the covered buildings platform has expanded substantially. Filings must be made by May 1st of each year (starting May 1 2018 for the mid-sized buildings). Benchmarking scores range from 1 – 100. Higher scores indicate higher levels of energy efficiency and lower scores, lower levels of efficiency. A Benchmarking score of 50 represents the median level of energy consumption for buildings nationwide. In NYC, the median score is somewhat higher – in the 60 range. 
If your building has a below average Benchmarking score, you would be well advised to take action, because low scores equal lost profits. But before you jump into the “fix it fast mode”, try and quantify your risk/reward equation. You want to make sure that the cost of the fix meets the economic smell test. One approach would be to add up your annual oil/gas bills along with your electric bills. Then take 10% or 15% of the combined total to quantify the potential savings that could be achieved. Most buildings can save between 20% to 35% in energy costs, so targeting energy savings in the 10% to 15% range is realistic. From this total you could develop your budget to engage an engineer to perform a “targeted” energy assessment, focusing on your largest areas of energy expense – lighting and heating. Remember that with today’s technology, literally every system in every building that consumes energy can be upgraded with a more energy efficient replacement. The issue is to prioritize these potential measures, so that you start with the best payback with the highest economic return and then work from there. A good example of a potential measure with one of the best paybacks is LED lighting. Because LED lighting products have dramatically lower levels of electric consumption, as compared to incandescent or fluorescent products that they are designed to replace, the average investment payback is in the two to three year range. Rarely will you find a LED upgrade project that exceeds a three year payback. These compelling returns are backed by 5 year readily available manufacturers warranties. These warranties in effect guarantee the financial success of your LED upgrade, which in turn will improve your Benchmarking score.
Considering the City’s overall Energy Savings Goals, this Benchmarking expansion should not come as any surprise. The larger platform of covered buildings, which now includes thousands of smaller buildings, is designed to increase energy consumption awareness for as large a population of buildings as possible. The “hoped for” result is that buildings with scores under the median will be motivated to improve efficiencies. Improved efficiencies result in improved bottom lines. 
The original Green House Gas reduction goal set under PlaNYC was 30% by 2030. Then a new more ambitious Green House Gas goal of an 80% reduction by 2050 from 2005 levels was established. Realistically, the new Green House Gas reduction goal of 80% is not going to “just” happen without a push to ramp up the pace for more Green House Gas reductions.
All covered buildings are required to file by May 1st annually. Failure to file will result in a $500 fine. Continued failure to file will result in an additional $500 fine for every three months thereafter - with an annual cap of $2,000. If a first year mid-sized building is unable to file in time, they may contact the NYC Benchmarking Help Center 60 days or more before May 1st and request a 60 day filing extension. 
For the thousands of newly covered buildings in the 25,000 sf to 50,000 sf range, the expansion of energy conservation related Local Laws, including LL 84 Benchmarking, opens up requirements into uncharted territory. For specific answers to Local Law 84 questions, go to: “NYC Benchmarking Law Frequently Asked Questions” – a printer friendly “site” which includes instructions as well as a Benchmarking Help contact number. For buildings over 50,000 sf, see this as a heads up to carefully review all required energy saving regulations to make sure that you develop your own best track for compliance.  
George Crawford is principal of Green Partners LLC. 

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