Washington, D.C., begins measuring building energy use under new law

WASHINGTON — A new law requiring commercial building owners to measure – and eventually make public — energy use in their largest buildings took effect Jan. 1, 2010, here, ushering in what proponents say will be an era of greater energy efficiency and transparency in the district’s building marketplace, reducing energy costs for all.

Under the law, all commercial buildings greater than 200,000-sq.ft. must be benchmarked annually, using the U.S. Environmental Protection Agency’s Energy Star Portfolio Manager rating system. The system accounts for differences between buildings – such as climate, occupancy levels and operating hours – so that direct comparisons can be made between similar buildings. The resulting rating reveals not just how much energy a building uses, but how efficiently it uses it.

“Energy costs are the highest single expense of property ownership and management, with the exception of real estate taxes,” said Kathy Barnes, a senior vice president with Akridge, a District of Columbia-based property development, ownership and management firm with 11 Energy Star buildings in its portfolio. “Energy spending is the one expense you have the most control over. If you are not watching that and managing energy use, you are going to get priced out of the market.”

“You can’t manage what you don’t measure,” said Cliff Majersik, executive director of the Institute for Market Transformation, a District of Columbia-based nonprofit, dedicated to greater efficiency in buildings that helped craft the law. “The measures in the district will slash energy waste and reduce energy costs for building owners and consumers.”

In the district, where buildings consume more than 70% of all electricity — a statistic mirrored nationwide — some commercial building managers and owners have been voluntarily benchmarking their buildings’ energy performance for years in an effort to save money.

Property managers say the benchmarking process reveals efficiency improvements that can be done for little or no cost, such as fine-tuning heating and cooling systems, replacing inefficient lights or linking lighting to motion sensors. The savings give them a competitive edge in a tight real estate market.

The district’s benchmarking law was passed in July 2008 as part of the Clean and Affordable Energy Act. It requires benchmarking for commercial buildings on a graduated schedule based on size, starting this year with buildings larger than 200,000-sq.ft. Each following year, the threshold will drop by 50,000-sq.ft. until 2013, when all buildings larger than 50,000-sq.ft. must be benchmarked.

Starting in 2012, building owners must also publicly disclose their energy ratings, giving prospective tenants and buyers an easy way to compare the energy consumption and operating costs of buildings.

The district’s benchmarking and disclosure law is one of only a handful of similar policies enacted in states and municipalities, such as California, Washington and most recently in New York City. At the federal level, pending climate bills in both the U.S. House of Representatives and U.S. Senate have provisions for a voluntary national building energy rating program.

“You want to start measuring energy use now, so you have time to improve your ratings before you have to disclose them publicly,” said Jack Beuttell, global sustainability manager for Hines, a commercial real estate investment, development and property management firm with 10 buildings in the District of Columbia benchmarked using Energy Star. “Energy Star Portfolio Manager is a free, online tool and the EPA is a hugely cooperative organization that is genuinely interested in partnering with and recognizing property owners that are working to measure and manage building energy use.”