The Boston City Council will soon vote on whether to adopt a new rule requiring energy scores for large and medium commercial buildings. The building energy measurement and disclosure ordinance proposed by Mayor Thomas Menino is a win-win for the city of Boston, commercial tenants, responsible owners and the environment.
Boston’s proposed standard is similar to programs in other U.S. cities, including New York, where public disclosure of relative energy efficiency revealed that some supposedly “green” buildings were underperforming, while some less-glitzy buildings gained top scores.
Based on ENERGY STAR’s building energy rating, the process is free and simple. Building managers provide data and the automated cloud-based ENERGY STAR Portfolio Manager compares it with similar buildings to generate a comparative score on a scale of 1 to 100. More than 40 percent of large buildings across the country already voluntarily participate in ENERGY STAR and the number is growing.
Cities like Boston pursue mandatory disclosure as a way to reduce carbon emissions, conserve energy, and minimize the risk of blackouts during peak usage periods. In many cities, buildings represent as much as three-quarters of all electricity use and well over half of all carbon emissions.
Up to one-third of energy from office buildings can be avoided without affecting tenant comfort or requiring owners to make costly upgrades. The first step to improving energy efficiency is to measure current performance – and ENERGY STAR is the most widely used measurement for that.
Everyone Saves
Our firm manages several hundred buildings across the U.S., including 10 ENERGY STAR-labeled properties in the Boston area. Virtually 100 percent of the properties we manage for owners voluntarily participate in ENERGY STAR, and they’re seeing improving scores whether or not they’ve made investments in efficiency. By simply monitoring use and changing behaviors, building managers can save significantly.
Opponents of the Boston ordinance point to a report from the Analysis Group, which found no evidence that energy measurement and disclosure leads to performance improvements. However, that analysis looked narrowly at buildings in Denmark, even though these laws are in place in more than 30 countries. It also acknowledged that buildings with high ENERGY STAR scores get higher rent and sell for higher prices than buildings with low scores. Other studies confirm these returns. Data from a number of commercial real estate analyses show that ENERGY STAR-labeled buildings, for example, enjoy rent premiums of $2.40 per square foot compared with their non-rated peers and 13 percent higher rental rates than the market average.
Most important, energy improvement is not expensive. Some strategies, such as simply turning off lights at night, cost little or nothing. Many others, such as upgrading lighting systems and replacing incandescent light bulbs with LED bulbs, pay for themselves in a year or two.
We’re not alone in our support. Other leading commercial property owners and managers, as evidenced by testimony supporting this ordinance from Beacon Capital Partners, Boston Properties, A Better City and the Conference of Boston Teaching Hospitals, among others, are all supporting the Mayor on this issue.
Building energy reporting and disclosure is the best, least intrusive way to motivate owners to focus on sensible energy efficiency measures, and to help tenants make informed leasing decisions. Boston and other cities have a compelling public interest in reducing carbon emissions to combat climate change, and buildings need to be part of that solution. If owners embrace this ordinance as a way to gradually improve performance based on market demand, there’s a good chance they will avoid facing more intrusive requirements in the future.
Dan Probst, a LEED Accredited Professional, is chairman of energy and Sustainability Services for Jones Lang LaSalle
