Real Estate

Two Sides to Boston’s Proposed Energy Scoring Ordinance

The City of Boston has proposed an energy scoring ordinance that would rate condominiums, apartments and commercial buildings with an eye toward impacting property valuations so that owners are incentivized to invest in energy saving technologies. The Greater Boston Real Estate Board has come out strongly against the proposed ordinance questioning its energy scoring effectiveness and highlighting the financial burden on property owners that could be passed on to tenants. Buildings with over 25 units are specifically identified in the ordinance. A hearing is expected to be scheduled in the Spring 2013. We present both sides of the debate.

Mayor Menino Announces Filing of Building Energy Reporting and Disclosure Ordinance
Large Commercial and Residential Buildings Would Disclose Energy Usage in Order to Encourage Investment in Energy Efficiency

Mayor Thomas M. Menino announced today the filing of the Building Energy Reporting and Disclosure Ordinance with the Boston City Council. As a component of the City’s climate action plan to meet Mayor Menino’s greenhouse gas reduction goals, this ordinance would require all large and medium sized-buildings to report their annual energy and water use to the City of Boston. The proposed ordinance is intended to encourage building owners to participate in local utility energy efficiency programs and educate tenants on building performance.

“In order for Boston to continue to be a sustainability leader, our buildings must aggressively invest in energy efficiency,” Mayor Menino said. “Bostonians demand buildings with high performance and this ordinance will encourage building owners to meet that demand.”

Major cities across the country have already adopted similar ordinances including New York City, Washington, D.C., San Francisco, Seattle and Minneapolis. Lessons learned from these cities have informed the Ordinance proposed by Mayor Menino which would require all large and medium sized buildings to report annual energy use, water use, and greenhouse gas emissions tracked through Energy Star Portfolio Manager to the City of Boston Environment Department. The City would then make energy and water use per square foot, Energy Star ratings, greenhouse gas emissions, and other identifying and contextual information for individual buildings available online.

“The Building Energy Reporting and Disclosure Ordinance follows the principal of what gets measured gets managed,” says Brian Swett, Chief of Environment and Energy. “Through measurement and transparency the Ordinance will encourage cost effective building investments in energy and water efficiency that will improve building performance, save money, and reduce greenhouse gas emissions.”

Since fall of 2012, the City has been conducting extensive outreach to a wide variety of building owners, industry organizations, and other stakeholders to craft the Ordinance. In particular, Environment and Energy Services is working with local utilities to help develop a process that simplifies whole building data collection and reporting.

Leading by example, Boston would annually disclose its energy and water use in all of its facilities starting with 2012 building data. In following years, the ordinance would apply to non-residential buildings greater than 25,000 square feet and residential buildings 25 units or more. The proposed roll out schedule for reporting requirements is as follows:

  • Non-residential buildings 50,000 square feet or more in 2014
  • Residential buildings with 50 units or more in 2015
  • Non-residential buildings 25,000 square feet or more in 2016
  • Residential buildings with 25 units or more in 2017

In addition to reporting energy and water use, buildings may be required to conduct energy audits or other evaluations every five years to identify opportunities for energy efficiency investments. Buildings in the top tier of energy performance or already taking significant efficiency actions will be exempted from this requirement.

Reducing greenhouse gas emissions through investments in energy efficiency is the largest component of the Mayor’s Climate Action Plan. Mayor Menino has established Boston as a national leader in reducing greenhouse gas emissions and promoting a clean energy economy through initiatives such as Renew Boston and the first in the nation green building standards for private developments. To further inspire action, Mayor Menino has launched Greenovate Boston, a new sustainability movement to ensure a greener, healthier and more prosperous future for the City.


Fact Sheet Supplement by City of Boston (pdf)

Condominium Owners Fined In Proposed Boston Ordinance

Environmental regulators in Boston are pushing to become the first municipality in Massachusetts to require commercial and residential building owners, including condominiums with 25 units or more to “score” their building, or face enforcement and fines. According to City officials this proposal is first in a series of steps to implement a plan, which also calls for scoring and retrofitting a building’s inefficient energy systems at the time of property transfer.

The City’s ordinance will require property owners, including condominium associations, to collect utility information from every household or commercial tenant, complete complex energy audits, and then report and disclose the results-which will then be evaluated or “scored” by government regulators. Owners who refuse to comply will face enforcement or fines. The same goes for individual tenants or condominium owners who refuse to turn over their utility bills to allow for an accurate audit. Buildings may be subject to an ASHRAE audit with estimated costs between $20-50k depending on the size of the building.

While the City hopes to replicate energy scoring programs that have been adopted in other cities, there is no credible evidence to date that this regulatory approach is effective in achieving the goals for which they are intended. The Greater Boston Real Estate Board is deeply troubled by the eager embrace of an unproven program – particularly when it is expected to cost property owners hundreds of millions of dollars to implement – not to mention the financial burden imposed on customers who already pay a surcharge on their energy bills for energy efficiency programs.

The bill has been referred to the Committee on Government Operations for a public hearing. Under the City Charter the Mayor may file an ordinance “he deems to be for the welfare of the city” that becomes law automatically unless it is rejected by the Council or withdrawn by the Mayor within 60 days after the date it is filed.

The Boston Herald also argues against the ordinance in this editorial.

Click here to see recent Boston Globe article
Click here to see a recent Boston Herald article

Click here to see a copy of the ordinance