Finding the Right Retrofit Policy

Last month, Mayor de Blasio released a proposal to reduce carbon emissions from New York City buildings.

This proposal would limit fossil fuel consumption in large buildings. Owners would have until 2030 to meet or surpass specific consumption reduction targets, which vary by building type (multifamily, commercial, industrial and institutional). Targets for affordable housing would come later. By 2020, the city would add targets for electricity use.

New York City is fortunate to have a mayor who has made climate change a top priority, as evidenced by a well-staffed sustainability office. And we very much share the end goal of fostering sustainable buildings in a healthy, thriving city. However, we have two core concerns with the city’s proposal:

  1. It’s a one-size-fits-all approach. All multifamily buildings would need to achieve the same target number for reducing fossil fuel burned onsite, and all commercial buildings would need to hit another number (no matter what the tenant type or space use). The same goes for the other building sectors.


    Looking at those targets more closely, they mean that 25 percent of multifamily and 60 percent of commercial properties won’t need to make any changes. Among those most impacted are some high-energy users for whom hitting the city’s target would be a serious financial hardship—for instance, one-third of multifamily buildings constructed before 1980 would need to cut fossil consumption in half to hit the city’s targets.
     
  2. Regulating fossil fuel use, to the exclusion of electricity, limits choices for building owners and unnecessarily drives up costs. Fossil fuels are burned in buildings largely for heat and hot water. Imagine an apartment building where the heating system is decent, the old windows are leaky but functional, and the tenants all have inefficient, 1990s, built-in air conditioners. Under the city’s proposal, the owner might need to replace the windows, as this expensive improvement is the only way to hit the mandated fuel target.


    But if the city’s overarching target was overall energy and carbon reductions—both on-site fossil fuels and electricity—the building owner could choose to deal with something a bit easier first, like replacing those air conditioners. Doing so would have the added benefit of reducing electricity use during the summer, when air quality is at its worst and the dirtiest power plants are fired up to keep our buildings cool. The owner could then wait to upgrade the windows at the normal replacement cycle. There are numerous examples like this.

Urban Green is a convener, a consensus builder and a subject-matter-expert on green building. We intend to use our position to help refine the city’s ideas as we look towards the legislative process and consideration by the City Council.

What would a more effective policy look like?

Here’s what we believe should be included in a carbon reduction policy for large buildings, taking into account all of the stakeholder perspectives we’ve heard to date:

  • Regulate all energy in larger buildings, not fossil fuels and electricity separately. This way, owners can determine their own energy efficiency path.
  • All buildings should reduce their energy use by some percentage. The big users would do more and the smaller users would do less. The most efficient performers—say, those in the lowest ten percent of consumption—get a pass; those in the top ten percent would need to bring their energy use below the 90th percentile.
  • The size of the percentage reduction is as much a political decision as a scientific one. Large buildings in NYC improved their energy efficiency by about one percent per year from 2010 to 2015. (Total reductions were much larger, but that was largely due to factors such as a more efficient electricity grid and changing from oil to gas boilers.) To ramp up the existing reduction trend, something in the neighborhood of 15 percent over 10 years seems like the place to start a conversation.
  • The city should lead by example in its own buildings, going deeper than the private sector: perhaps a 25 percent reduction during the same period.

To make this workable, there are some important nuances:

  • For commercial buildings, the reduction should be based on occupancy rather than building size. Office “densification,” meaning more people in less space, is good from an energy perspective. And there are exceptions to accommodate, like high energy-using trading floors.
  • Buildings should have some flexibility in choosing their “baseline” year for calculating energy reductions, so that owners who’ve already made large efficiency investments get credit.
  • Provide flexibility for large changes in use. For example, we don’t want to discourage owners from accepting tenants that use a lot of electricity, like 24/7 supermarkets.
  • In order to avoid driving up costs for tenants in affordable housing, those buildings should be required to hit percent reductions by implementing a list of operational or apartment-level practices that would not trigger rent increases.
  • Include a safety valve for situations in which costs might otherwise get out of hand. Building owners should be allowed to achieve at least some portion of compliance by contracting for new, clean power. After all, there are two halves to the energy equation–how much we use and how clean it is.

We believe this approach is better for building owners and will achieve more for less.

In the coming months, we will meet with stakeholders to solicit their input, with the goal of being able to share a more detailed proposal shortly thereafter. In the interim, we will report out on ideas emerging from our stakeholder discussions.

We hope our contributions will help New York City lead the way towards significant carbon reduction in the urban environment.

If you have questions or comments, feel free to contact us at membership@urbangreencouncil.org.

About the author

Russell Unger
Russell Unger is Executive Director of Urban Green Council.