On April 22, 2019, Earth Day, the City of New York enacted the “Climate Mobilization Act” into law (“Intro 1253”). This law will impose mandatory GHG emission limits for large buildings, beginning in calendar year 2024. This new rule is clearly the most ambitious Climate Change rule taken by a U.S. municipality.

Buildings are responsible for about 70% of NYC’s GHG emissions; half of this comes from large buildings. Therefore, NYC has focused on the building sector to meet their 80% X 2050 emission reduction goals, starting with its own energy code and with local laws requiring benchmarking, energy audits, retro-commissioning, and sub-metering.

Rule Overview

Intro 1253 goes further, containing GHG emission intensity limits on nearly all buildings of at least 25,000 square feet of floor area beginning in 2024. The law defines the term “building emissions” as “GHG emissions as expressed in metric tons of CO2e emitted as a result of operating a covered building.” Thus, the limits on GHG emissions will apply not only to Scope 1 or on-site sources (such as those from a building’s boiler) but also include Scope 2 or off-site sources caused by a demand, such as purchased steam or electricity consumed in building operations. The building emissions intensity limits are tailored to specific Occupancy Groups. They will be be ratcheted down in 5-year intervals after 2029 to reduce GHG emissions from covered buildings by 80% by 2050.

The table in the link below summarizes GHG emission limits from different listed building types. https://energywatch-inc.com/breaking-new-york-city-council-passes-first-of-its-kind-ghg-emissions-cap-for-buildings/

Exemptions

A major category exempt from this law is “rent regulated accommodations”, such as those with rent-stabilized units, lest rents may be raised markedly for needed upgrades. Intro 1253 does require the owners of such excluded rental multifamily buildings to implement several prescriptive energy conservation measures, such as repairing leaky heating systems, insulating pipes for heat and hot water, weatherizing windows and ductwork, and installing timers on exhaust fans. Among the other rule exemptions are public housing and houses of public worship. Not-for-profit hospitals and health-care facilities are not exempted from the rule but will need to meet less stringent standards.

Paths To Compliance

Intro 1253 provides a number of pathways to reduce GHG emissions. Thus, reductions may be credited to an owner for “renewable energy credits” (RECs), so long as the RECs are generated by a renewable source located in or directly deliverable to NYC. For calendar years between 2024 and 2029 deductions for up to 10% of reported annual emissions may also be taken for GHG offsets (offsite emission reductions) purchased by a building owner. Additional deductions from a building’s calculated emissions for the output of a clean distributed energy resource must be located at, on, in or directly connected to the building.

This new law does not allow for emissions trading among covered buildings. However, the City is studying the feasibility of such a trading scheme and will report to the Mayor and Speaker of the City Council by no later than January 1, 2021.

Intro 1253 imposes significant civil penalties for exceeding the annual building emissions limit and the degree of excess emissions. These penalties could run into the hundreds of thousands of dollars annually.

What You Can Do NOW To Reduce The Cost and
Aggravation of Complying

Owners of covered buildings should take advantage of the “head start” before the 2024 compliance date to begin developing strategies for addressing the requirements of Intro 1253. Technical experts can estimate whether a building, as it is operating today, would comply with the 2024 limits and, if not, options to achieve compliance in time. The owner has time to choose the best option(s) to comply, reducing costs and risk if the owner waited longer. And future planning is critical. The technical assessment can anticipate the likely operation and emissions of systems in 2024. This early determination of strategies can save a building owner a lot in avoided compliance costs.

Intro 1253 is reality. Building owners in NYC will need to determine their GHG emissions and possibly modify or upgrade energy systems to comply with the standards. Other cities and states will be watching and Intro 1253 could well be a model that others will emulate. Don’t just push this aside to another time or year. Look into this soon, be active, and take steps soon to comply, saving you money and raising your asset value. Watch out for more CCES blog articles on this rule and how to comply as the City of New York provides more details!

CCES has the experts in both energy engineering and greenhouse gas (“carbon”) emissions to help you assess your covered buildings and their compliance status, and can recommend smart and prudent steps to ensure compliance early on, saving you much money, improving asset value, and reducing the worry about compliance. Contact us today at 914-584-6720 or at karell@CCESworld.com.