First Local Law 97 Emissions Rules Finally Finalized
New York City has finalized the rules attached to Local Law 97, with few changes from what was made public in draft form in October.
The law, which was introduced in 2019, will apply to buildings 25K SF and larger and requires owners to stay beneath certain emissions thresholds starting in 2024 or face fines.
Only minor changes were made from the draft, and there are still concerns from sustainability experts regarding the use of energy credits, Crain’s New York Business reports. The first batch of final rules applies to 50,000 structures, and more regulations are expected to be laid out in the months ahead.
“Getting implementation of this law right is critical to the future of our city — which is why the Adams administration is committed to a smart and carefully considered approach,” acting Department of Buildings Commissioner Kazimir Vilenchik said in a statement to Crain’s.
Christopher Halfnight, senior director of policy and research at the Urban Green Council, said the rules have provided “much-needed” certainty.
“We now have a very large down payment on the details, and that’s great, that’s what’s needed for many owners to turn from planning to action,” he said.
The New York Department of Buildings in October outlined in its draft rules how formulas would work to calculate both a building’s annual greenhouse gas emissions and the limit it should comply with. It also lays out how to determine a building’s gross floor area for the purpose of reporting to the department.
The law was passed as part of the 2019 Climate Mobilization Act, which aims to decrease the city's carbon output 80% by 2050. Property owners could face fines of $268 for every ton of emissions above their limit — the formula for which was finalized this week — and those limits get stricter in 2030.
The draft showed that owners would be able to comply by offsetting emissions from electricity by buying renewable energy credits from solar and wind projects. Offsetting electricity could be a major benefit for commercial owners. Some questions remain on how these renewable energy credits would be used.
The commercial real estate industry argues the credits are a necessary part of meeting the law’s demands. But Urban Green Council’s analysis indicates that a quarter of multifamily properties and two-thirds of office properties above their 2030 limits could still be within the laws entirely through purchasing energy credits rather than actually reducing their own emissions.
“As we get closer to 2030 and the fines get higher, and the number of buildings goes from 20% of the building stock to higher, then that is going to become even more relevant to all the parties involved," Savills Executive Managing Director Gabe Marans told Bisnow in October. "There is a lot of anxiety in the real estate community.”