Turning Data into Action:
By analyzing publicly available building data, our team identified strategic packages of retrofit measures well-suited to four common commercial building typologies, organized by heating and cooling system, and applicable to more than 70% of NYC’s large office buildings.
These retrofit packages offer options for building decision-makers to achieve moderate to deep emissions savings, and provide viable pathways to LL97 compliance for buildings at nearly any level of baseline performance.
Meeting the Challenges of a Changing World
As the global climate crisis grows ever more urgent, New York City (NYC) is blazing a trail to curb greenhouse gas (GHG) emissions from its greatest source—existing buildings. The office buildings at the heart of the city’s iconic skyline are some of the biggest emitters, with high average levels of energy use and emissions across the sector.
While building owners, operators, and tenants will face unique challenges in meeting newly enacted emissions regulations, they can seize this moment to transform NYC’s office buildings for the better —not only achieving compliance, but creating healthier, higher performance workspaces that set the standard for New York’s climate-ready future.
Accounting for Emissions
NYC is home to roughly one million buildings, which are the greatest contributors to citywide emissions by far. Emitting more GHG than the transportation and waste sectors combined, existing buildings account for nearly 70% of the city’s GHG footprint.
About one-third of these emissions come from the commercial sector, within which office buildings account for the greatest share of GHG, energy use, and square footage. While they vary widely by design, occupant density, and space use, on average, NYC’s office buildings are 50% more energy intensive than similarly-sized multifamily buildings.
Shifting the Paradigm
Recognizing the critical need to curb building-based emissions, the New York City Council passed the 2019 Climate Mobilization Act featuring Local Law 97 (LL97), which imposes first-ever GHG emissions limits on existing large buildings. Taking effect in 2024, the limits are set to grow increasingly stringent over time. Buildings that exceed their GHG thresholds will face fines that can total millions of dollars annually.
Fortunately, most office buildings are already set to meet 2024 requirements, or will be able to achieve compliance with relatively simple efficiency upgrades or operations and maintenance improvements. In most cases, the types of measures commonly identified in energy audits—a requirement for large buildings since 2009 under NYC Local Law 87 (LL87)—will be sufficient.
In 2030, however—just six years after LL97 goes into effect—GHG emissions limits grow much tighter. To comply during this second phase, most of NYC’s 550 million square feet (sf) of office space will need to undergo decarbonization retrofits at an unprecedented pace and scale.
Typical LL87 audit recommended measures alone will not suffice. To date, energy auditors have tended to recommend measures that pay back in under five years, limiting potential energy and emissions savings. In light of LL97 fines, however, the return on investment for more comprehensive retrofits has shifted significantly, making them more economical than ever before.
Additionally, LL97’s focus on whole-building, site-based GHG emissions calls for decision-makers to look beyond the typical base-building efficiency improvements. Leased tenant spaces often account for more than half of an office building’s energy use, and our report finds that tenant fit-outs alone can reduce building-wide emissions by as much as 20%. Even simple tenant improvements can achieve notable savings.
To meet the challenges of LL97 and the climate crisis, the building industry will need a new paradigm —one that prioritizes owner-tenant collaboration, thoughtful capital planning, and strategic implementation of deeper decarbonization measures than ever before. Fortunately, there is a wide array of well-proven, market-tested solutions to meet this need.
Leveraging the Power of Data
This report recognizes that planning for office building decarbonization requires a unique approach. To evaluate the efficacy of various retrofit solutions, our team classified NYC’s office buildings into four typologies based on their primary heating and cooling systems, rather than grouping them by building age, size, or fuel-type—as is commonly done in the multifamily sector.
By analyzing publicly available NYC building data, our team identified strategic packages of retrofit measures well-suited to each of the four typologies and applicable to more than 70% of NYC’s large office buildings. These retrofit packages offer options for building decision-makers to achieve moderate to deep emissions savings, and provide viable pathways to LL97 compliance for buildings at nearly any level of baseline performance.
To help decision-makers select an optimal set of these packages, our team developed four tearsheets as custom resources for each of the four office typologies. After calculating their building’s current GHG emissions and the percent reduction needed to meet LL97 limits, a decision-maker can use their tearsheet to choose from three retrofit pathways, for either a modest (5-10%), medium (10-25%), or major (>25%) GHG reduction.
From there, they can follow their pathway to relevant packages of decarbonization measures, which include both base building and tenant space solutions for all major systems. Cummulatively, these packages can reduce a building’s emissions by as much as 35%. By selecting a custom combination of solutions, decision-makers can gain insight into how they might develop a comprehensive, long-term capital plan for LL97 compliance.
While successful capital plans must be tailored to building specifics, many high-impact decarbonization measures are nearly universal in their applicability. These include: replacing fossil fuel systems with electric-powered equipment; deploying smart controls for major building systems; moving energy-intensive operations, like data centers, offsite when possible; and addressing issues in both base building and tenant spaces.
2030 is fast approaching and with it, stringent new regulations. In order to avoid hefty annual penalties for LL97 non-compliance, building owners must start planning today.
This report and accompanying tearsheets offer guidance for individuals to begin formulating comprehensive retrofit plans, enabling them to minimize costs and disruptions by phasing in projects at strategic milestones, like the time of tenant turnover or equipment replacement, rather than in response to emergencies, like equipment failure.
Armed with proven solutions and a new paradigm for action, New York’s real estate community can reduce their operating costs and avoid fines, while simultaneously building healthier, higher quality workspaces and a better future for all.