Chicago Implements Building Rating System, Encourages Businesses to Reduce Energy Use
Chicago recently became the first U.S. city to assign large buildings an energy performance rating with the launch of its Chicago Energy Rating System.1 Additionally, properties are required to display their ratings in a prominent location and must share them when listing the property for sale or lease. According to Chicago’s Energy Benchmarking Help Center, buildings that do not comply may be subject to fines.
This initiative aligns with the Chicago’s commitment to reduce its carbon footprint and reach the goals of the Paris Agreement, which calls for a 26-28% carbon emissions reduction by 2025 (measured against a 2005 baseline).2 In addition, Chicago is targeting buildings for energy reduction as a strategy to meet its sustainability goals and has committed to using 100% renewable energy in buildings across the city by 2035.
Quick History of the Energy Benchmarking Initiative
In September 2013, Mayor Emanuel and Chicago’s City Council adopted the Chicago Energy Benchmarking ordinance, which directs existing municipal, commercial, institutional and residential buildings greater than 50,000 square feet to report their whole-building characteristics and energy use information to the City of Chicago annually.
Fast forward to 2017, the City Council voted to update its existing benchmarking ordinance that created the Chicago Energy Rating System that would make energy use information easily accessible and include a 0 to 4-star scale rating system. A 4-star rating is assigned to the highest energy performers. In 2019, Chicago announced that this easy accessibility would take form in the shape of a placard, which must be placed in a prominent location on a business’ property by the end of September 2019; however, there is a six-month grace period to post the placards during the initial program kick-off in 2019. Thereafter, new placards must be posted immediately upon receipt each year.
Businesses over 50,000 square feet will have until June 1st of every year to report their building-level characteristics and energy use information from the previous year, giving them an opportunity once a year to update the placard, reflecting their latest efforts to reduce energy.
Why Building Owners Should Get Involved Now
- Avoid Paying Fines
According to Chicago’s Energy Benchmarking Help Center, buildings that do not comply may be subject to fines. The City is expected to first generate a non-compliance notification and will be available to work with building owners to help them comply with the data reporting requirement. However, if building owners miss the reporting deadline and do not make a good effort to input the required information into the Environmental Protection Agency’s ENERGY STAR Portfolio Manager tool for purposes of complying with the benchmarking ordinance, they may be subject to fines up to ~$9,200.
- Avoid Public Disclosure and Zero Rating for Non-Compliance
In addition to possibly being fined for non-compliance, if building owners without an exemption fail to report their information in the Portfolio Manager tool by June 1st of every year, it could lead to a zero-star Chicago Energy Rating. By complying, building owners can avoid the null association.
- Reap Potential Savings by Complying to Energy Benchmarking
According to Chicago’s 2018 Chicago Energy Benchmarking Report, on average, properties that have been reporting/benchmarking 2 to 5 years consecutively are reducing energy use per square foot by ~0.5 to 2% annually, based on weather-normalized energy use per square foot (takes into account changes in weather and property size). In addition, estimated savings for these reporting properties is ~$21 million per year from reductions in energy use.
So What Energy-Efficient Upgrades Should Business Make to Their Buildings?
Chicago businesses looking to get started on improving the sustainability status of their buildings can take advantage of Constellation’s Efficiency Made Easy (EME) program. Through EME, you can identify and implement efficiency upgrades that can help you reduce energy costs and manage usage. Plus, the program requires no upfront capital so you can preserve your budget for other business priorities.
Upgrades may include:
- LED lighting upgrades
- Building automation controls
- Building envelope [external walls, windows, roof, and foundation] improvements
- HVAC and cooling
For more information on our Efficiency Made Easy solution, visit www.constellation.com/EME.