Energy Disclosure is Coming to Boston

By Grey Lee

The USGBC MA Chapter is happy to promote, support, and advocate for public disclosure of energy use in Boston. According to the recent proposal, different types and sizes of buildings will report their energy use score (using EPA's Energy Star Portfolio Manager) into a public database over the next four years. The city will rate all the buildings it owns starting in 2013. The information will be used to help the city's Energy and Environment Office, led by former USGBC MA Board VP Brian Swett, to craft incentives and programs to help owners embrace energy efficiency measures. It will not be used to force anyone to do anything, just to report their building's energy use. One of our members Chris Liston, Director of Energy and Sustainability at CBRE New England, noted that for his clients in New York, reporting for the entire year can be done in about 30 minutes.

I went to City Hall on Thursday, March 28 to submit supportive testimony to the City Council, which will be voting on the ordinance in the near future. We believe the ordinance will lead to better building values, better tenant experiences, better building operating practices, reduced waste of energy, and reduced greenhouse gas emissions among other things. Some organizations, including Boston's Building Owners and Managers Association (BOMA), came out against the ordinance. Industry leaders like Partners Healthcare and Boston Properties spoke in support of the ordinance. It seemed like a lot of the opposition just didn't understand the program. It was too bad, but the USGBC MA Chapter is here to help people learn more and get more support behind the measure.

The ordinance is somewhat like telling people to go weigh themselves when you care about their health. If someone knows their weight, they might decide to start exercising or eating better. But some people just don't even want to know things and this ordinance isn't even like telling anyone you have to go to the gym – just to get weighed!

Our testimony is on this page, in the news and announcement section of our website. You can also see me, near the beginning, in this video. The city has a lot of info on the ordinance at the Energy and Environmental Services Office.

Below is the famous Boston City Hall—the civic building that everyone loves to deride. It is a bit dingy, but it serves the purpose. A lot of important work goes on there and the needs of the city are met by the Mayor, the City Council, and the many municipal employees working for Boston.

Below is the City Council Chamber. The table in the foreground was for panelists to submit testimony. There on the right side of the table is Darien Crimmin, member of the Chapter and VP for Sustainability and Energy at Winn Development, testifying on behalf of energy disclosure. His firm measures and scores their buildings with the Energy Star Portfolio Manager in order to make better management decisions about where to invest in physical plant improvements and energy efficiency projects.

One of the criticisms of the proposal came from a study, funded by BOMA, by Harvard researcher Robert Stavins. His conclusion was that no city where an ordinance exists has been able to show a measurable decrease in energy use. One response to this is that these laws have only just been implemented and it's reasonable to have not seen appreciable savings yet. Advocates point to the fact that industry leaders are already using disclosure and energy scoring to save money and make investments in energy efficiency. BOMA Boston suggests that the market is the best encouragement for this rather than a city-mandated policy.

We were disappointed at so much negative reaction from the conventional real estate world. One advocacy entity had revved up the reactionaries in the condominium association world. Many small condo association representatives came to complain about potential cost burdens on their residents.

I am afraid the term “assessment,” i.e. “energy assessment” was confused with the red-letter financial “assessment” concept that poorly managed condominium associations occasionally levy on their members to handle unplanned-for capital improvements.

It was a real shame. Brian Swett reported that the proposed ordinance only affects multi-family properties and/or condo associations with more than 25 units, of which there are only about 250 in the city, not the thousands that association reps were claiming. The ordinance does not affect single-family homes. One confused broker mentioned that having an energy score on a unit or house would be a major hassle for sellers—they already have to disclose lead and radon; adding energy efficiency to the mix could provide prospective buyers with more information than they could handle. The pro- side of the ordinance gave a round of applause on that one.

One opposition heavyweight (below) that came to testify the Commercial Real Estate Development Association of Boston near the end was David Begelfer, CEO of NAIOP. He argued that Boston should stay out of the real estate markets and let best practices reward the right players.

Brian Koop, VP at Boston Properties, came up with a good analogy. He noted that his kids love to play basketball. They play ball in the driveway with other kids in the neighborhood. When he comes home driving down the street, he can instantly tell whether the kids are keeping score or just playing around. When you keep track of the score, he said, you play differently. You play better batter when keeping track of the score. He talked about how his firm is serious about energy efficiency and uses Portfolio Manager to keep track of the performance of their properties, all of which guides important, asset-improving investments. He urged the city to help other firms get serious about improving their operations using energy disclosure as well.

One important note that came through was that owners and traditional real estate folks felt like they had not been involved in the process enough and they wanted the ordinance to be less punitive. They wanted to be at the table. I'm not sure exactly how the industry was involved in the drafting of the ordinance in Boston, but I can see how a more inclusionary process might have worked better and muted much of the resistance. So much of it was irrelevant rants from misinformed activists, but that's democracy for you!

USGBC's national advocacy lead Jeremy Sigmon wrote to me: “Property owners in many cities, including San Francisco, Seattle and New York City, worked hand-in-hand with city officials to develop recommendations on benchmarking and disclosure ordinances. Local ordinances have been supported by the Real Estate Board of New York and BOMA San Francisco. From BOMA San Francisco: “Our property owners initially thought, 'Oh, this is going to be horrible' … but there's been no blowback, if you will, from property owners,” said Ken Cleaveland, a vice president with BOMA San Francisco. “It's just been a non-issue, quite frankly.”

I was glad to represent the Chapter at City Hall. It was a valuable learning experience for me and I met a lot of good people working on this disclosure ordinance. Thank you to the Chapter's Advocacy Interest Group for pulling together our testimony—Norm Lamonde and Greg Sampson principally. Thank you to Brian Swett for arranging me to be on one of the support panels. I look forward to working with the coalition to make energy disclosure a reality here, in Boston and beyond.

As I left, I noticed a lot of media coverage of the event. I knew it was contentious, but I didn't realize energy disclosure was such a hot-button issue!

(Well, actually, it did happen to be the same afternoon Mayor Menino announced his retirement…)