Local Law Compliance: Climate Mobilization Act

Service: Energy Efficiency & Sustainability

Luthin Associates has rich experience in energy markets, renewable procurement, sustainability, benchmarking and facility master plan development. This experience coupled with our deep-rooted regulatory expertise in local law compliance and NYISO markets, translates into a profound understanding of how the Climate Mobilization Act impacts your building(s).

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New York City’s Climate Mobilization Act is an umbrella term for a set of laws designed to transition New York toward clean electricity and drastically lower its Greenhouse Gas (GHG) emissions. The intent of this Act is to counter the threat of climate change. The impact of this legislation can be displayed across four categories which require:

  1. Local Laws 92 and 94: Mandates that certain existing building roofs must be covered in green roofs or Solar Photovoltaics (PVs), including new construction
  2. Local Law 95: All buildings will be assigned an energy efficiency grade
  3. Local law 96: Establishes a sustainable energy loan program
  4. Local Law 97: Sets annual carbon emission limits for buildings

More About Local Law 97

Local Law 97 exerts immediate short-term financial impact to many buildings in New York City, and presents the greatest scope for improvement. Beginning in 2024, it stipulates a greenhouse gas budget for every building over 25,000 square feet and assesses penalties for exceedance. Every affected building is required to submit an annual certificate of its greenhouse gas emissions, and pay exceedance penalties, if any. Factors that affect a building’s greenhouse gas budget are:

  1. The occupancy classes of the spaces within the building property
  2. The area of the building (in square feet)

The chart below is a demonstration of the carbon penalties for a 100,000 square foot building, with 2,000 tons of emitted carbon dioxide, from 2024 through 2050. Each bar represents the varying penalties based on occupancy class.

Annual Carbon Penalties under Different Occupancy Classes

Local Law 97 shields certain buildings with specialty classifications from the full impact of the ‘carbon penalty’. Individual buildings with mixed occupancy classes or a group of buildings with different classes are still being evaluated by NYC as to whether they can be grouped under a single occupancy class.  The following case studies provide further insight and suggests strategies to navigate this new legislation.

A Tale of Two Industries

Luthin Associates conducted a study on a large university campus in New York, based on its historical benchmarking (Local Law 84) filings. A large group of more than twenty buildings had been blanket classified under a single occupancy class in EPA’s Portfolio Manager tool, and the combined energy consumption of all buildings was found to be in exceedance of the group’s GHG emissions budget. Luthin Associates worked with the University to identify each individual building’s commodity usage and delineate separate occupancy classes for each constituent building. In this case, it was found that individually classifying each building reduced the annual carbon penalty. See the chart below for further explanation of the savings based on occupancy classifications.

On Campus_Penalty Disparity By Blanket Occupancy Classification

In another case, Luthin Associates worked with a large real estate firm in New York to determine the carbon tax for a building in their portfolio. Luthin carefully reviewed engineers’ estimates of energy usage, evaluated different scenarios with peak-shaving technologies (a cogeneration system, batteries, and thermal energy storage systems) and possible occupancy classes under which that the spaces in the building could be classified. With the client’s insight that most of the building space would house bio-medical research with 24-hour intensive energy use, this meant that the building could now qualify for a relatively lenient emissions limit, provided the necessary paperwork was filed in a timely fashion.

Our financial analysis on the carbon impact and utility energy avoidance from the various technologies aids in the decision making of which energy conservation measures provide the largest impact. These combined efforts help reduce carbon penalties and ensure accurate assessment of project ROI.