For those unfamiliar, New York City’s Local Law 87, authored in 2009, is an ambitions piece of legislation which requires all buildings over 50,000 square feet to have an energy audit and retrocommissioning performed once every 10 years. A younger member of NYC’s family of green legislation, the law is an extension of Local Law 84, which requires buildings to submit energy data to the city annually.Last year (2013) marked the first year of filings, many of which came in a mad rush towards the end of the year as real estate stakeholders became aware of the new requirements. With deadlines looming, Bright Power submitted the very first Local Law 87 submission to the City, followed by roughly sixty-five more like it. Almost a year later, The Department of Buildings (DOB) has completed its first round of reviews; meanwhile, Bright Power and other providers are rushing to submit the next wave of buildings. So what did we learn?
We Have Seen Local Law 87, and It Is Good
By the latest count, 13,466 buildings fall under the umbrella of Local Law 87. That means that over the next 10 years, every single one will have someone crawling through the basement, flipping switches, and asking, “Does this work? Can I make it better?”. Conversations with clients have shown that there is a diverse range of Local Law 87 providers offering a wide range of costs and subjecting buildings to widely different levels of scrutiny. But make no mistake: for many of those thirteen thousand buildings, this is the first time those questions will be asked. And that makes a difference, at any level of service.
Local Law 87 Saves Energy
We can’t speak for the city overall, but an analysis of our data shows that for our first year’s portfolio, there was a 6% reduction in total energy use after retrocommissioning work was completed. It’s hard to control for much more than weather and different fuel types (which we did), but it’s an encouraging data point, and over the next few years we’ll keep watching to see what happens. For most of those buildings, a 6% energy savings equates to a two-year payback on the cost of retrocommissioning – or less. What made the difference? It was mostly simple measures: insulating pipes, turning off lights and air conditioning in mechanical spaces where it wasn’t needed, replacing steam traps, and turning down excessive heating and domestic hot water set points. It wasn’t complicated. Someone just had to look.
Local Law 87 Is Going To Get More Expensive
In the last few months, we’ve gotten DOB’s official comments on several of our submissions, as well as the opportunity to work with their technical reviewers to understand the standard of care they’re looking for. When the Law (and clarifying Rule) were published, they left providers with big questions – and the responsibility of interpreting the law for their clients. Now we’re getting some answers, and the trend is towards an even higher level of attention to all aspects of buildings. The comments we’ve seen send the message that DOB is serious about implementing this law, and will be looking for thorough, rigorous performance testing down to the level of individual sensors and circuits in buildings. They reserve the right to stop accepting submissions from providers who don’t meet their standards. What does this mean? Immediately, providers will have to raise fees for local law compliance, or be forced out of the market. While some may see this as a financial burden, our experience so far gives us hope that with the support of DOB, we can take a deeper dive into building systems throughout the city and expand on the success of our first year.
The Need for Accountability
Ambiguities in the law were a difficult challenge for Local Law 87 providers, who had to balance the interests of their clients on one hand against the unknown whims of the city. For many building systems prevalent in New York City – especially steam systems – no nationally recognized standards exist, and enforcement of the law was an every-firm-for-itself affair. The limited number of providers in the market and specialized nature of the corrective work required also brought up the question of conflicts of interest. The first round of submissions walked an ethical tightrope, at least for the more scrupulous firms. For all the real and potential good Local Law 87 has to offer, its first year put many providers in a tight spot. To that end, there is a strong need for advocacy from providers and clients. We must push the city to adopt standards, create standards where none exists, and clarify what their requirements are in a consistent manner. Ultimately, this will allow for accountability and consistency in the application of the law. That helps keep costs down for property owners, mitigates risk for providers, and simplifies DOB’s seemingly sisyphean task of shepherding thirteen thousand buildings towards a more efficient future.
What’s Next?
Alongside more rigorous testing and the (hopeful) creation of consistent standards, there’s talk of expanding the law to buildings under 25,000 square feet, adding thousands of buildings and owners. Just how that might look is still unclear. Those who focus on the upfront cost of implementing the law need to refocus their attention on the value. As our own experience shows, this work, done right, pays for itself in energy savings alone. And that doesn’t even account for the benefits of extending the life of the equipment by running it better. Smaller buildings need this attention at least as much as larger buildings, and they need the expertise of our industry to keep them running cost-effectively and comfortably into the next few decades.