Is your Building an “A” or an “F”?

Would you go to a restaurant that had anything but a letter “A” posted in the window? As recently reported in Curbed NY, Local Law 95, which is an amendment to Local Law 33, mandates that all New York City buildings post their letter grade on the building. Buildings are expected to receive their letters in the fall of 2020. The building grade is based on how much carbon it emits; in a nutshell, new buildings will have higher grades while old buildings will have poorer grades.

The reason for this is that the grades are based on the energy used by the entire building. This includes the commercial tenants as well as residents. Commercial tenants use a lot of energy, with excessive amounts of light fixtures, refrigerators, large HVAC systems, storage space with lights on 24/7, etc.

For those residents who have their A/C on 24/7 from May to September and think that it doesn’t matter because they pay for their own ConEd bill, think again. Energy inefficient residents will result in a poorer grade for the entire building. Starting in 2024, building with poor energy grades will be subject to fines as part of Local Law 97.

Of the old buildings, the ones with commercial tenants such as Chase, Morton Williams, CVS or Duane Reade will have poorer grades than buildings with no commercial tenants. In addition, buildings with commercial tenants that are open 24-hours a day will have even poorer grades.

Of the coop and condo buildings that we track who have these types of large commercial tenants, residents’ electric usage equals roughly that of the commercial tenant’s, or approximately 40% each. The remaining 20% is used by the building’s common spaces such as the hallways, lobby, and basement. The same proportions can be applied to the heating. The question really becomes, how does a building get CVS and individual residents to use less electricity and heat?

The EPA tool, called Energy Star, will generate a grade based on the building type and size, compared to other structures in similar climates. Find your building’s grade here.

As previously reported in Urban Green Council, Grades are based on Energy Star scores as follows:

• ·       A: 85 or above

• ·       B: 70 - 84

• ·       C: 55 - 69

• ·       D: 0 - 54

• ·       F: buildings that don’t submit required benchmarking information

• ·       N: buildings exempt from benchmarking, i.e. less than 25,000 square feet

Many of the condos and coops that we work with had a C in 2016. However, Energy Star has changed how it calculates these scores. The result has been that even a building that reduced their Weather Normalized Source EUI (kBtu/ft²) by over 50% from 2016 to 2018, saw their Energy Star score go down from 62 to 47 for the same period.

Benchmarking started in 2011. It has been a seemingly long learning curve, with year-over-year data charts indicating that most buildings are reporting incorrect data.

The latest available report is from 2017. Out of 12,097 buildings that reported their LL84 that year, 3,698 buildings, or 31% had an Energy Star greater than 85. This corresponds to a letter grade A. This group of buildings were built, on average, in 1948. More likely than not, these buildings have not included the electricity used by the residents. It will be interesting to see whether those buildings post their A.

What’s the legal ramification of buying a coop or condo that has an A-rating slapped on the entrance, which turns out to be a letter grade C or D once the data has been corrected? Stay tuned!

The Folson Group is a NYC energy efficiency consultant, helping buildings with all their Environmental, Social, and Governance (ESG)-related policies. Services cover the entire process, from planning to implementation and completion, and clients have achieved energy reductions of up to 40%. If you are interested in making your building more energy efficient and environmentally friendly, consider reaching out to The Folson Group to schedule a consultation.