Energy Disclosure is Good for Real Estate and for Boston

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Dan Probst - Jones Lang LaSallePosted by:
Dan Probst
Energy and Sustainability Services

Just recently, Boston City Council voted on a Building Energy Rating and Disclosure Ordinance. As a component of the City’s Climate Action Plan to meet the Mayor’s greenhouse gas reduction goal of 25 percent by 2020, this ordinance would require all large- and medium-sized buildings to report their annual energy and water use to the City of Boston. Buildings that do not have high energy performance or are not showing significant improvements would be required to conduct an energy audit or similar measure every five years.

I’m proud to share that Boston City Council voted to approve the ordinance 9-4, despite substantial campaigns led by the opposition. I worked directly with Northwest Energy Efficiency Partnerships (NEEP) to raise awareness of the benefits of this ordinance, including calling Boston City Council members to explain why I support the initiative and developing an op-ed for local publication Banker and Tradesman.

Boston’s ordinance is similar to programs in other U.S. cities, including New York City, where public disclosure of relative energy efficiency revealed that some supposedly “green” buildings were not performing all that well, while some less-glitzy buildings gained top scores. 

The “scores” are determined by information provided to, and verified by, Energy Star. That’s the same Energy Star that rates household appliances and electronics for energy efficiency, except that buildings are rated on a relative scale of 1 to 100. For example, a building with a 60 score is more efficient than 60 percent of similar buildings. A building in the top quartile—a score of 75 or higher—can earn an Energy Star label.

Cities like Boston pursue mandatory disclosure as a way to reduce carbon emissions 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 could 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 measurement everyone agrees on.

Jones Lang LaSalle manages several hundred buildings across the country, including 10 Energy Star-labeled properties in the Boston area.  Virtually 100 percent of properties we manage for owners participate in Energy Star. We have found that our scores tend to increase each year buildings are in Energy Star. That’s true even where owners have not made investments in efficiency.

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. Thanks to Boston City Council members voting to approve the Building Energy Rating and Disclosure Ordinance – they can.

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