Intra-continental rating leaders: Denmark and NYC

At the 2012 ACEEE Market Transformation Symposium, a session on building energy rating and disclosure highlighted some of the issues facing two policy pioneers. Denmark and New York City are leaders in the rating policy arena (although Denmark is the clear and longstanding forerunner) within their respective continents. Jens Laustsen, Technical Director of the Global Building Performance Network, gave an overview of Denmark’s global trailblazing and Hilary Beber, of New York City Mayor’s Office of Planning and Sustainability, informed similarly about her city’s efforts.

According to Jens, Denmark started down the rating and disclosure pathway twenty years ago. Following the late 70’s oil shocks, the government sought out policies to dramatically improving the efficiency of the national building stock. Today, Denmark has refined their system in accordance with the EU’s Energy Performance of Buildings Directive (EPBD). All residential and commercial buildings must be rated and disclosed before property is bought or sold; public buildings must publicly display their ratings.

Denmark decided to use an asset rating for all building types. The evaluation method measures comfort energy—a term similar to regulated energy in the US—which refers to the energy uses which affect thermal comfort (ie. HVAC and hot water, as well as lighting for non-residential buildings). The approach minimizes the effect of occupants on energy use, removing the plug load uses and occupancy behaviors that affect energy performance. This values the efficiency of structures themselves, making for better comparison in a market where building energy performance ratings have a history. Danes are familiar with such labels: roughly 50% of new and existing buildings already have one.[1]

 The most significant challenge facing the disclosure of energy performance in Danish buildings, though, is getting people to trust the ratings. Asset ratings are notoriously variable, and recent survey results show that their perceived usefulness by consumers is only moderate.[1] A practical, functional enforcement system is also needed.

Enforcement in New York is just beginning. As explained by Hilary Beber, the city is preparing to send out fines to buildings who failed to comply with Local Law 84. The law requires buildings over 50,000 square feet to conduct rate their energy performance and disclose it to the city. New York is requiring an operational rating for all building types, specifically using the EPA’s Portfolio Manger tool. This rating process takes all of the metered consumption of a building and normalizes it for occupancy, climate and other factors, spitting out a general efficiency score. 

The disclosure part has been good so far: 75% of the required buildings have reported their ratings to the city (the other 25% are the ones being fined). Fortunately, this compliance rate is estiamted to be much higher than the average for brand new building department laws. Unfortunately, there is work to be done with quality control. Beber and her colleagues are working with researchers to identify potential errors in energy rating submissions. They are now following up with companies and building owners who may have submitted bad data. This process is essential to turning these disclosed efficiency scores into real savings for owners who decide to make improvements.

Denmark and New York are continental leaders in national and local rating and disclsoure mandates. Peers are watching closely and vying to out-compete: there are thirty alternative national rating policies afoot in Europe and seven U.S. cities and states with New York-like policies in place. The next few years will be an exciting field of competition.