NYC Building Emission Standards One Year Later and the Impact of COVID-19

3 min

This article has been published in Capalino+Company’s newsletter, Affairs+Appointments.

Local Law 97 of New York City's Climate Mobilization Act requires certain buildings to reduce greenhouse gas emissions beginning in 2024. The City is moving forward to implement the law, although certain elements have been affected by the COVID-19 shutdown. Venable's prior summary of Local Law 97 is available here.

Since the Climate Mobilization Act was passed, three major developments have occurred. First, the City has set up the organizational structure for implementation of the Act. The Local Law 97 Advisory Board (the Board) was formed in December 2019. The Board consists of fifteen architects, engineers, and other real estate and environmental consultants tasked with delivering recommendations on Local Law 97. In April 2020, the Board announced eight dedicated working groups to work in such areas as building technologies, carbon accounting, economics, and communication. Initial metrics for required reductions between 2024 and 2029 were included in Local Law 97; one of the Board's responsibilities over the next 3 years is to develop and recommend metrics for 2030 onward, for adoption by the City Council. Furthermore, the Office of Building Energy and Emissions Performance (the Office) has been created within the New York City Department of Buildings (DOB). Once staff are appointed, the Office will serve as the center of day-to-day implementation of Local Law 97 and as a resource as building owners begin to retrofit buildings or consider carbon trading programs.

Second, the 2020 New York City Energy Conservation Code (the 2020 Code) has been enacted. The 2020 Code adopts New York State's NYSERDA NYStretch Energy Code, but specifically tailors it to NYC's urban environment. The 2020 Code is applicable to new construction projects and requires measures such as more efficient interior lighting and reduction of energy loss through building envelopes and balconies.

Third, DOB announced the launch of the Carbon Neutrality Innovation Challenge (the Innovation Challenge). The Innovation Challenge is DOB's first-ever competition to solicit new ideas related to energy efficiency. Design ideas will be submitted to DOB's Innovation Review Board and Buildings Sustainability Board. Selected Innovation Challenge winners will present their proposals at the DOB Build Safe/Live Safe conference currently scheduled for September 2020.

Questions Raised by COVID-19

Certain elements of the Act have been delayed or may need to be clarified because of the COVID-19 pandemic. For example, the Act established property-assessed clean energy (PACE) financing for residential and commercial buildings to reduce up-front energy retrofit costs. The commercial PACE program, which is administered by the New York City Energy Efficiency Corporation, has been unable to process applications because of the COVID-19 crisis and delays in final government rulemaking. Furthermore, building owners dealing with the costs of the COVID-19 shutdown and reopening may no longer have the capital available to make the required energy efficiency improvements to their buildings. The Act does not contemplate COVID-19-related losses, which owners might argue are a financial hardship created by government order, which should allow for a lower initial reduction amount or delay in compliance.

We will continue to keep you updated as additional developments occur. Please contact Venable if you have any questions regarding this update.