Understanding Local Law 97: A Comprehensive Guide

Local Law 97, a landmark legislation in New York City’s bid for sustainability and reduced carbon emissions, is reshaping the way building owners manage and measure their properties’ environmental impact. In this extensive guide, we’ll demystify Local Law 97, its purpose, key provisions, implications, and how to comply with its standards.

We’ll delve into the details of energy efficiency standards, carbon emissions caps, and penalties that the law imposes on non-compliant buildings. Additionally, we’ll explore the integral role only legislation plays in promoting sustainable urban living, its potential effects on the environment, and strategies that building owners can utilize to adhere to these regulations effectively and efficiently.

Introduction to Local Law 97

Local Law 97, also known as the Climate Mobilization Act, is a landmark legislation passed by the New York City Council in 2019. The law aims to aggressively curb building-based greenhouse gas emissions, considered the leading driver of climate change in New York City.

What Is Local Law 97?

Local Law 97 places emissions limits on buildings larger than 25,000 square feet. It affects around 50,000 buildings in New York City, including residential, commercial, institutional, and industrial buildings. The legislation sets increasingly stringent caps on carbon emissions from covered buildings, targeting a 40% emissions reduction by 2030 and 80% by 2050 from 2005 levels.

To comply with the law, building owners will need to improve energy efficiency and transition to less carbon-intensive fuel sources. Financial penalties will be imposed on non-compliant buildings starting in 2024.

The Purpose and Scope of Local Law 97

Buildings account for nearly 70% of New York City’s greenhouse gas emissions. Local Law 97 aims to aggressively curb emissions from large buildings, which constitute just 2% of the city’s building stock but produce 30% of building-based emissions.

The legislation sets carbon intensity limits per square foot for various property types. Limits become stricter over time, requiring building owners to cut emissions through energy efficiency upgrades, renewable energy adoption, fuel switching, and other carbon-reduction strategies.

The law applies to commercial buildings over 25,000 square feet, residential buildings over 25 units, and city-owned properties over 10,000 square feet. Some affordable housing and rent regulated units are exempted.

Key Entities Involved in Local Law 97 Legislation

The New York City Council passed Local Law 97 with support from the Mayor’s Office and the NYC Accelerator program. The NYC Department of Buildings will oversee compliance through benchmarking submissions and audits.

An Advisory Board will make recommendations on compliance matters to support building owners. Real estate industry groups, environmental advocates, and other stakeholders were involved in shaping the legislation.

Understanding the Key Provisions of Local Law 97

Energy Efficiency Standards

Starting in 2024, Local Law 97 requires covered buildings to meet energy efficiency standards. Buildings must achieve greenhouse gas (GHG) emissions limits per square foot based on property type and size.
Limits become stricter over three compliance periods: 2024-2029, 2030-2034, and 2035-2050. Financial penalties up to millions of dollars annually will be imposed for exceeding caps.

Owners of non-compliant buildings will be required to purchase renewable energy credits and/or carbon offsets. They must also demonstrate a good faith effort to upgrade energy efficiency systems.

Carbon Emissions Caps

In the first compliance period (2024-2029), the average carbon coefficient will be 0.021 tCO2e/sf. In the second period (2030-2034), it drops to 0.015 tCO2e/sf, declining further to 0.007 tCO2e/sf in the third period (2035-2050).

These steadily declining carbon caps will require buildings to improve efficiency, electrify systems, and integrate renewable energy to achieve mandated emissions reductions.

Penalties for Non-Compliance

If a covered building exceeds its carbon emissions limit under Local Law 97, penalties will apply starting at $268 per metric ton over the limit in 2024.

Fines scale up annually, reaching over $1 million for a 100,000 sq ft building that takes limited action to curb emissions. Buildings must also purchase renewable energy credits and carbon offsets for excess emissions.

Additionally, Local Law 97 empowers city regulators to identify the top 5% of non-compliant buildings each year. These buildings must undergo energy audits and retro-commissioning to ensure efficiency measures are implemented.


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The Impact and Importance of Local Law 97

Local Law 97 is considered the most ambitious climate legislation for buildings enacted by any city in the world. It applies to around 50,000 of the largest buildings in NYC, including commercial offices, residential buildings, hospitals, colleges, hotels and more. These buildings must reduce their carbon emissions by 40% by 2030 and 80% by 2050, from a 2005 baseline.

The potential impact of Local Law 97 is huge – it aims to cut building emissions by 26% citywide by 2030. This would greatly help NYC reach its larger goal of reducing overall emissions by 40% in the next 7 years. The legislation is thus a crucial part of NYC’s plan to fight climate change and could set an example for other cities around the world.

Implications for Building Owners

Local Law 97 has major implications for the owners of large NYC buildings. They will need to carry out energy efficiency upgrades, switch to renewable energy sources, and make major changes in order to comply with the strict emissions limits.

Some key steps owners will likely need to take include installing energy efficient heating/cooling systems, adding insulation, sealing air leaks, upgrading to LED lighting, adding solar panels or wind power systems, and more. Many buildings will need heating system revamps to transition from oil or gas to electricity or renewable sources.

These changes will require major capital investments. However, there are incentives available in the form of tax breaks, low interest loans, and rebate programs that owners can utilize. Working with energy management consultants and legal professionals can also help identify the most cost-effective paths to compliance.

The Potential Effect of Law 97 on the Environment

The emissions reductions from Local Law 97 have the potential to significantly benefit New York’s environment and public health. Cutting large building emissions by 40% by 2030 would remove roughly 4.5 million metric tons of greenhouse gases from the atmosphere each year.

This would improve New York’s air quality, reduce smog, and lower rates of pollution-related respiratory illness. It would also help mitigate the impacts of climate change such as rising sea levels, extreme heat, and flooding from major storms.

Switching heating systems from fossil fuels to electricity and renewable sources will further clean the air by eliminating on-site emissions. Greater building efficiency will also reduce energy demand, allowing cleaner power sources to meet more of the city’s electricity needs.

Steps Toward Sustainable Urban Living

Local Law 97 is a major step in transitioning one of the world’s largest and most iconic cities to become greener and more sustainable. The legislation provides a framework and incentives for dramatically reducing carbon emissions from buildings.

Meeting the ambitious 2050 target of 80% emissions reductions will require phasing out fossil fuels entirely from large buildings. This will mean widespread electrification of heating systems, expanded use of renewables like solar and wind, high-efficiency building shells, and likely emerging technologies.

If successful, the law can serve as a model for sustainable urban living and provide a blueprint for other global cities to follow. The innovative policies and transition of NYC’s building stock may inspire widespread adoption of green buildings and urban planning worldwide.


Compliance With Local Law 97

Strategies for Compliance

Building owners have a variety of strategies and paths available to achieve compliance with Local Law 97’s emissions limits. A customized energy audit is key to identify cost-effective upgrades that maximize energy savings.

Some common measures include insulation, air sealing, heating and cooling equipment upgrades, controls and building automation systems, high-efficiency water heating, passive solar design, renewable energy systems, and more. Switching between different fossil fuel types can also help optimize emissions.

Assistance and Support for Compliance

NYC provides many resources to aid building owners in complying with LL97. Energy auditing incentives help plan upgrades. Low-cost financing through Commercial PACE loans and the Accelerator program subsidize projects.

The NYC Retrofit Accelerator provides free advisory services and connects owners to vetted contractors. Nonprofits like Urban Green Council offer carbon calculators, best practice guides, and training. ConEdison and other utilities also have energy reduction programs.

For affordable housing, the NYC Housing Preservation Department assists with energy improvements through grant programs. Additional allowances are granted for rent regulated units. Support is also available for houses of worship and small building owners.

The Future of Local Law 97 and Compliance Expectations

LL97 will phase in emission limits through 2050, with the first compliance period beginning in 2024. The law allows DOB flexibility to modify limits as technology improves. An advisory board will assess progress and challenges annually.

Over time, compliance will likely require widespread electrification of heating and hot water systems, expanded on-site renewables, retro-commissioning, and deep energy retrofits. Advances in battery storage, smart controls, and grid flexibility will aid this transition.

With strong government support, clean energy incentives, and innovative solutions from the private sector, full decarbonization of NYC’s largest buildings is an ambitious but achievable goal for 2050.

Keep Your Property Protected With BBG’s Legal Expertise

BBG is your trusted partner in navigating the complexities of Local Law 97 and ensuring your property complies with these critical regulations. Our experienced legal team is well-versed in the intricacies of New York City’s real estate laws and is ready to provide you with expert guidance and representation.

With a track record of successful legal services, we understand the unique challenges building owners face and can help you develop a compliance strategy that suits your property’s needs and your budget.

Don’t navigate the maze of Local Law 97 on your own. Let BBG be your legal partner in this journey towards a greener, more sustainable future for New York City.

Here at BBG, not only are we effective litigators and negotiators for our clients, we are also a trusted resource.

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