U.S. cities, states require large buildings cite energy use

Wonder how high the utility bills will be at that apartment you like? To help consumers and spur efficiency, U.S. states and cities are beginning this year to require that commercial buildings measure and disclose their energy use.

The new rules, which generally exempt small businesses, are expected to shame building owners into upgrades that will save energy and create jobs. They're akin to nutritional labels on food, Energy Star ratings on appliances and miles-per-gallon stickers on vehicles. They won't specify utility costs but will show a building's relative efficiency, measured in energy use per square foot for apartments.

Today is the deadline for 16,000 large buildings in New York City— representing half of its interior space — to report how much energy they used in the past year or face $500 quarterly fines. The city will post the data on a public website next year.

Similar requirements — the first of which took effect in January in Washington state — begin in Seattle, San Francisco and Washington, D.C., in October and in Austin next June and throughout California as early as next year. Half a dozen other states are considering such rules.

"They give consumers — tenants and investors — access to information they've not had previously," says Andrew Burr, author of a report on them by the Institute for Market Transformation, a Washington-based non-profit promoting energy efficiency.

"It's hard to overstate how significant this is," says Roger Platt of the private U.S. Green Building Council, adding many buildings don't track energy usage. "It's like a 12-step program. You first have to admit you have a problem."

Some oppose the mandatory route. "This scarlet letter, fear factor approach … stigmatizes" less efficient properties and could lower their property values, says Austin Perez of the National Association of Realtors. He says tax credits and loan guarantees are a better way to prod owners to upgrade buildings.

The Department of Energy's Kathleen Hogan says DOE plans next spring to begin testing a voluntary program to rate the energy efficiency of commercial buildings, similar to a pilot program it finished in June for rating homes.

Seattle, which aims to reduce energy use 20% by 2020, opted for mandatory reporting, because "voluntary programs weren't getting us there fast enough," says Jayson Antonoff, an energy adviser for the city. He says 860 buildings with more than 50,000 square feet must report by Oct. 1 and another 8,000 buildings with more than 10,000 square feet by April 1.

Nationwide, he says, "the number of buildings that will be benchmarked (for energy) is going to explode."