Benchmarking laws have gained traction across major cities in the USA. Metropolitan centers such as New York City, Seattle, Boston, San Francisco, and Washington D.C. have all required large buildings in their jurisdictions to report annual energy consumption. Proponents of these local laws hope that by disclosing usage, owners and operators will be able to better understand strategies for reducing consumption. These benchmarking initiatives are not without challenges though. Reporting can be tedious and time-intensive for building owners, especially for multi-family building owners who have to collect data from separately metered tenants and enter it all into EPA’s Portfolio Manager tool. Additionally, there are privacy issues at play for reporting tenant usage; however, if data is aggregated on the building level, targeting tenants whose usage is above average is not possible. In addition to balancing privacy with the need for fine-grained data, the benchmarking process has highlighted the issue of the split incentive – where tenants have little motivation to engage in energy efficiency if the landlord foots the energy bill, or where landlords have few reasons to invest in energy efficiency if the tenants alone are reaping the benefit of lower energy bills. Despite these issues, benchmarking is a good start to developing energy efficiency policies.
Hey Honey, Don’t Tell the Neighbors I left the Air Conditioning OnNext City, April 22, 2014
When Washington, D.C. passed its energy benchmarking ordinance in 2008 — requiring large buildings to report their annual energy consumption — it unleashed something of a national craze. Since then, similar laws have passed in at least nine other cities, including New York, Seattle, Boston, and San Francisco. At this point, the holdouts are starting to look like they didn’t get the memo.
The laws may seem modest; after all, they mandate only disclosure, not actual cuts in resource use. But they have captured the imaginations of policymakers and energy nerds. With this newly available information, the thinking goes, owners will gain a deeper understanding of their own properties, equipping them to invest wisely in measures that could slash utility bills. Prospective buyers and tenants will factor energy-efficiency into their decisions, ultimately making it a desirable real estate trait along the lines of a snazzy lobby or a hip location. And city governments can draw on emerging patterns as the basis of future energy policies.