Mayor's Plan Targets Greenhouse Gas Emissions of Buildings
Mayor Bill de Blasio recently proposed new mandates that would force building owners to make sharp reductions in greenhouse gas emissions. The initiative would mandate that owners of existing buildings larger than 25,000 square feet invest in more efficient heating and cooling systems, insulation, and hot-water heaters in the years ahead. If approved by the City Council, the requirements would apply to about 14,500 private and municipal buildings, which the mayor’s office says collectively account for nearly a quarter of New York City’s emissions. Most buildings would need to comply with new efficiency targets by 2030, or their owners would face penalties.
To compel building owners to meet these aggressive targets, the legislation would set annual penalties that increase with building size and the amount the buildings exceed the fossil fuel use targets. For example, a 30,000 square foot residential building operating substantially above its energy target would pay $60,000 for every year over the standard, starting in 2030. A one million square foot building operating well over its energy target would pay as much as $2 million for every year over target. Failure to comply would also affect a building’s ability to receive future permits for major renovations.
To help smaller owners achieve these objectives, the legislation would authorize a Property Assessed Clean Energy program to provide financing at low interest with long terms that allow property owners to pay for energy efficiency investments through their property tax bill. A PACE program in New York City has the potential to finance $100 million annually in energy efficiency and clean energy projects. A 54-unit apartment building in the Bronx that recently upgraded its boiler and made energy-saving upgrades would have saved $8,000 per year in debt payments had PACE financing been available. The city will also continue to provide expansive technical support and sharing of best practices through the NYC Retrofit Accelerator program.
The plan intends to stop owners of rent-regulated buildings from displacing tenants or raising rents based on the cost of improvements required by new mandates. Targets for these buildings would be established in 2020, in tandem with reform of rent regulation. They would also have an extended compliance date of 2035.