E-Book, Chapter 6 How Energy Codes and Legislation Impact The 50-Year Renovation Cycle

Where have we come from and where are we going?

In the late 1970’s and early 1980’s, passive solar design was in vogue in architecture schools and students were asked to consider passive solar design techniques in their building and site design. By 1990, the LEED program, a comprehensive approach to improving energy efficiency and to managing resource selection and delivery was introduced informally and then formally in 1994. The international building code was adopted nationally in 1997. In 2012, Benchmarking of buildings was introduced, starting in California and New York, and spreading across the country as a required standard of care. More recently, in 2019, NYC and Washington DC stepped into the conversation and instituted very progressive and aggressive energy legislation.

There has been a steady flow of new and improved energy reduction code and legislation changes since 1994 that have changed the way buildings are designed and maintained. Significant energy use legislation and industry changes, starting with LEED Standards in 1994 include:

LEED (1994)     

Circa 1994, the USGBC, U. S Green Building Council introduced a voluntary energy and sustainability standard called LEED. Architects and Engineers studied to learn the LEED system of energy use and sustainability compliance standards postulated by the LEED standards. This voluntary standard led the construction industry into the 21st century when governments, including federal, state, county, and city legislative bodies introduced mandated compliance standards that have changed the landscape of building construction and ownership.

International Building Code (1997)

The international building code was introduced in 1997. This code supplanted other model building codes and brought wide-ranging standardization to the construction industry throughout the western world. This code has significantly enhanced the requirements of energy performance in buildings envelopes and HVAC systems. These code changes did not affect the use or operation of existing buildings and the influence of these code changes was limited to new construction or owner-driven renovation of existing facilities.

Freon R-22 ban (2005)   

In 2005, the federal government targeted the use of R-22 Freon refrigerant, used in cooling equipment. The ban is scheduled to take place in stages with the final stage occurring in 2020. Since 2020, US companies have no longer been able to manufacture or import Freon R-22 refrigerant. Although new refrigerant has been created, the ban on Freon R-22 has essentially required early retirement of millions of condensers, chillers, and associated fan coil or air handling units. Building owners have struggled to pay for the early retirement of equipment that still had useful life.

Benchmarking (2012)

In 2012, California and a host of other states, counties, and cities mandated a reporting standard called benchmarking. Benchmarking targets buildings which are over 50,000 SF in size. These larger buildings are required to report a 3-year baseline of energy use. The EPA created a database that tracks and compares building types and their energy use. Benchmarking was intended to incentivize building owners to be industry leaders in energy efficiency. Buildings which reached or exceeded the 85th percentile in efficiency, for their region and building type were granted Energy Star status. This status offered marketing and financing benefits for the building owner.

Solar Panel Requirement (2016) 

o   In 2016, San Francisco mandated that all new homes be fitted with solar power.

Detached Housing Ban (2019)  

In July of 2019, Oregon and Minneapolis banned the construction of detached housing all together. Austin, TX and Berkley CA are also studying the ban.

Building Commissioning (2020):

The international building code now requires testing and commissioning of new construction to ensure that energy compliance standards are being met and the operation of new buildings is taking advantage of newer technologies. This requirement was adopted by the International Energy Conservation Code, IECC in 2012 and was promoted by the Obama American Recovery and Reinvestment ACT with federal financial incentives of $3.1B. But this requirement has only gotten minimal adoption and enforcement across the nation. Washington DC attempted to adopt it in 2017 but implementation has been slow. Most jurisdictions and states have been reluctant to enforce this during the pandemic and beyond. Building commissioning was intended to address both building envelope and building system performance by verifying compliance during design and construction.

All of these energy codes and regulation changes have significantly influenced the role of energy use and conservation in construction over the last 25 years. In the last 15 years, changes in energy-use regulations have increasingly been led by major cities and states. In 2019, the leaders in energy use regulations are NYC and Washington DC.

Where are we Going with Energy Use Legislation?

January 2019: NYC passes Climate Mobilization Act

In July 2019, NYC passed a series of broad sweeping new clean energy bills. NYC legislators claim that they are following the goals of the Paris Climate Change Treaty. So, who is the most ambitious – DC or NYC and what do these new laws mean for architects, engineers, facility managers, and property owners?

What is now required with New York City’s new Climate Mobilization Act Energy-use Regulations for buildings?

·       Green Roofs and Solar Panels: Local laws 92 and 94 require all new buildings and buildings undergoing major roof renovations to be covered with solar panels, green roofs, or some combination of the two. The laws also require all buildings to reduce urban heat hazards.

·       Carbon Reductions: The centerpiece of the Climate Mobilization Act, Local Law 97 requires all buildings larger than 25,000 square feet to meet ambitious carbon reduction targets. The Climate Mobilization ACT includes the following policy changes for existing Buildings:

·       Benchmarking: Local Law 95 amends the ranges for how energy efficiency grades are calculated as required by Local Law 33 of 2018. Local Law 33 of 2018 required the display of energy efficiency scores and grades for buildings that are required to annually benchmark their energy and water consumption. The energy label will be displayed near a public entrance and include both a letter grade and the energy efficiency score.

·       Pace Loan Financing for Energy upgrades: Local Law 96 establishes long-term, low-interest Property-Assessed Clean Energy financing to fund upgrades to building energy and water efficiency.

·       Benchmarking Disclosure: Local Law 84 requires annual benchmarking data to be submitted by owners of buildings with more than 50,000 square feet for public disclosure by May 1. This will bring transparency for energy and water usage and inform building owners and tenants on how to make their buildings more efficient.

·       Renovation Retrofit: No longer exempting renovations affecting less than half of the building system, Local Law 85 (LL85), the second law in the Greener, Greater Buildings Plan (GGBP), now requires buildings to meet the most current energy code for any renovation or alteration project

·       Energy Use Reporting Requirement: Local Law 87 requires large buildings to audit, retro-commission, and submit information to the City. The audit and retro-commissioning information includes the following:

o   Basic team information

o   General building information

o   Existing equipment inventory

o   Energy end use breakdown

o   Energy conservation measures identified from the audit

o   Retro-commissioning measures

Submetering Requirement: Local Law 88 requires large non-residential buildings to upgrade lighting to meet current New York City Energy Conservation Code standards, and to install electrical sub-meters for each large non-residential tenant space and provide monthly energy statements.

2019: Washington DC passed Omnibus Energy Act

DC’s 2019 Energy Act was based upon the national benchmarking of energy usage which began in California, circa 2014. Benchmarking sets a baseline standard for energy efficiency that is based upon comparison with other buildings. This arbitrary, rather than a fixed, standard is the new yardstick by which everyone will be measured. In other words, the future of energy performance standards will be based upon a constantly moving target that is set by your neighbors.

Example:

After 2021, DC owned buildings with more than 10,000 SF and commercial buildings with more than 50,000 SF have been required to be at or above the 85 percentiles in efficiency, when compared to similar use buildings of similar size. If buildings fail to meet this ambitious and constantly moving target, they will be required to improve their energy efficiency by 20% before 2026 or face fines. The new fines have not been fixed, as of yet. After 2021, the energy efficiency requirements slowly changes to include commercial buildings with 25,000 SF by 2023 and DC buildings with 10,000 SF by 2026.

Any building not meeting the compliance standard will be fined and enter into a 5-year period in which they will be required to meet the ambitious goals. Properties that will be most impacted will likely be:

1. low-income housing

2. historic properties

3. Properties that are just below the required standard but are expected to show 20% improvement over a short time frame.

What are the implications of these new regulations for architects, engineers, and building owners for 2020 and beyond?

New York City                      :

These recent stringent energy and emissions mandates in NYC has required extensive study and significant investment from building owners. To meet the new legislation, significant modifications by owners have been required, beyond the traditional MEP systems, and has required retrofit of building envelopes with newer windows, shades, green roofs, and added insulation. These new standards have the capacity to influence other states and municipalities to follow suit.

As a test case, nine buildings or projects in NYC were targeted for retrofit completion by 2025. The act also requires commercial buildings, over 25,000 SF in size, to reduce emissions by 40% by 2030 and by 80% by 2050. Among the first 9 buildings to be targeted are a parking garage, DCLA Brooklyn Museum, a school, and two - family residences. NYC will start auditing other municipal buildings such as public schools, hospital facilities and office buildings to identify poorly performing buildings that should be targeted for retrofit.

These new standards have significantly impacted both existing structures and new construction within NYC and the new policies are likely to reverberate throughout the country. The NYC Climate Mobilization Act (https://www1.nyc.gov/site/sustainability/legislation/legislation.page) sets a goal to reduce government operation emissions by 50% by 2030.

Is your building an Energy Star Building?

As of  2021, commercial buildings were required to be at or above the 85 percentiles in efficiency, when compared to similar use buildings of similar size.

What happens if your Building is not Energy Star?

If buildings fail to meet this target, they will be required to improve their energy efficiency by 20% before 2026 or face fines. (The new fines have not been fixed as of yet.)

What about smaller buildings:

As of 2023, this law applied to commercial buildings with 25,000 SF. In 2026, this law will apply to commercial buildings with 10,000 SF.

Does this apply to me?

If your building is not located in NYC or Washington DC, you are not required to meet the standards that apply only to those jurisdictions. However, it is likely that your state legislature and local government have some energy-based enhancements or goals that you may need to meet. The State of MD recently informed me that they have 0-Emmissions goals for 2030. Another client, a Big-10 university – state system – is expected to meet 0-Emmissions standards in the near future as well. Check your state and local energy-based initiatives and requirements before you start your renovation design and budgeting.

Energy codes require the greatest degree of compliance when the building is changed in a way that results in a significant increase in the demand for energy. For example: the conversion of a warehouse to office space would likely result in a greater energy demand and would be subject to a range of energy code requirements. The mere fact that the building has changed use is sufficient to trigger compliance with current energy codes. Energy code compliance is also required when the nature of the proposed work is such that there is the opportunity to upgrade the building without resulting in a disproportionate increase in construction cost. For example, if a proposed scope of work will expose existing uninsulated exterior wall cavities, adding insulation to those cavities will be required.

The code provisions applicable to existing buildings are complex, and in many cases, there are multiple options for compliance/approval. The building code itself contains three distinct methods for establishing the degree of code compliance required in existing buildings. In those circumstances where code compliance is impractical or impossible, there are two additional options: the submission of compliance alternatives to the local building official, or application for a variance from the Building Code Board of Appeals. Your architect and / or code consultant can assist you in evaluating the existing building and the proposed scope of work, determining the applicable code requirements, and developing the best course of action.

Facility Condition Assessments are the first step to preparing for and prioritizing your asset management goals. Having consistent and defensible data will help you to plan for and budget for the coming landslide of renovation. 

This E-Book attempts to identify and explain the issues related to the coming renovation cycle. In the next chapter, we will look at “Hitting the Sweet Spot for Renovation, Restoration, and Adaptive Reuse.

In Chapter 7 we will review code compliance from national and state standards.

For more information on the coming renovation cycle and the impacts of capital planning decision making from multiple perspectives, access the E-book to read more:

1.               The state of US Educational Facilities

2.               Hitting the sweet spot for renovation, restoration, repurposing

3.               The impact of Structure

4.               The impact of Infrastructure

5.               The impact of Building Envelope Issues

6.               The Impact of Energy Codes and Energy Legislation

7.               The impact of Renovation and Remodeling Codes

8.               The impact of Space Utilization and Education Objectives

9.                The Impact of Replacement, Remodeling, and Renovation cycles

The Importance of budgeting and cost engineering