FirstService Residential assembled a panel of experts to provide our clients with information and guidance on complying with Local Law 87 – a complex and potentially costly law that requires property owners to audit energy use and retro-commission their buildings every 10 years and submit an Energy Efficiency Report to the NYC Department of Buildings (DOB) documenting the results. The law impacts buildings over 50,000 square feet. Following are key takeaways from “Plotting the Right Course: How Multifamily Properties Can Benefit from Compliance with Local Law 87.”
Our Expert Panelists
What is an energy audit?
Holly Savoia, PE, CEM Director of Sustainability Enforcement, NYC Department of Buildings, responsible for Local Laws 84, 87, and 88
Jenna Tatum NYC Carbon Challenge Coordinator, Mayor’s Office of Long-Term Planning and Sustainability
Steve Wagner Board President of Southgate Owners Corp., a five-building complex with 420 units and an attorney that represents co-ops and condos
Da-Wei Huang, CEM, EBCP Director, Energy Management, FS Energy, the energy advisory subsidiary of FirstService Residential
An energy audit is a systematic analysis of a building’s energy equipment and systems to identify cost-effective capital improvements that will save energy. Auditors assess systems and maintenance schedules – including heating and cooling, lighting, ventilation, hot water systems and the building envelope – and consult with maintenance personnel and residents for feedback on potential issues.
“The audit essentially provides a menu of options for improving building efficiency. From there, the board can choose to implement which items make the most sense.” –Holly Savoia
“While each measure, in and of itself, may not make a significant difference, collectively implementing many small initiatives will result in a significant payback over time.” –Da-Wei Huang
What is retro-commissioning?
Retro-commissioning is the optimizing and tune-up of the existing building systems to confirm they are a) operating as designed or reflect current facility requirements, and b) are performing as efficiently as possible. Retro-commissioning commonly identifies operations, maintenance, and calibration errors that are easily corrected (i.e., a boiler tune-up) and, when implemented, typically amount to significant energy savings and improvement in equipment reliability.
What is an Energy Efficiency Report (EER)?
An EER consists of an ASHRAE Level II energy audit and retro-commissioning study of base building systems. Both the audit and study must be completed within four years prior to filing the EER with the Department of Buildings.
“Every single EER submitted to the DOB in 2013 that the Mayor’s Office reviewed recommended at least one efficiency measure – and some had multiple measures – that had under a three year payback. That means if implemented, the efficiency savings will pay for the capital cost in less than three years. Many of those are ‘no brainer’ measures to implement because you’ll start saving money almost immediately. –Jenna Tatum
When is my building due to comply?
The last digit of your tax block number determines which year your report is due. You can also complete work up to four years in advance of when your report is due, as long as you submit the report in the proper year.
“The sooner efficiency improvements are implemented, the sooner you will begin accumulating payback and/or savings.” –Steve Wagner
How do we select the right consultant to perform this work?
Your property manager (unless instructed otherwise by the board) will research service providers and obtain multiple quotes from consultants to conduct the audit and study. Many buildings refer to NYSERDA’s Multifamily Performance Program Partners who have proven experience in performing this work. Ultimately, you should choose a consultant with experience undertaking LL87 in buildings that are similar to yours in size and type. To help gauge the quality of their work, ask potential consultants for a client list, past Energy Efficiency Reports (EERs), and examples of energy savings from clients who followed their recommendations.
Should we conduct the audit and study at the same time?
Because there is substantial overlap between the two, conducting them simultaneously means building staff will spend less time compiling information. Performing the energy audit and retro-commissioning at the same time will also help ensure that the capital projects are actually necessary. For example, an energy audit may suggest that you replace a piece of equipment that is underperforming whereas retro-commissioning could mandate improving the equipment performance through better operating procedures and control sequence.
“Whether your building is simple or complex, solicit costs for each service separately as well as for both services as a package. Make your final decision based on a cost analysis of each option.” –Holly Savoia
What are we required to do with the energy audit findings?
While you are not required to execute any of the efficiency findings revealed in the energy audit, it is strongly recommended that you consider implementing any conservation measures that are low-cost or have a quick payback (i.e., installing lighting sensors or replacing inefficient light bulbs.) For recommendations that will be more expensive to implement, conduct a careful analysis of the payback and borrowing costs.
“This undertaking basically created a guidebook on what our board needs to consider regarding efficiency. At Southgate, 11 out of 17 recommended measures had a one or two year payback, so we were able to do a lot of things that were very cost effective and saved energy.” –Steve Wagner
What are we required to do with the retro-commissioning study findings?
You are required to implement measures revealed in the retro-commissioning study prior to submitting your report by December 31 of the year in which your building is due to comply.
“We found that almost half the buildings could save 15 percent on energy costs with less than a six year payback. That’s enough to hit our Carbon Challenge goal on top of saving money and helping the city reduce greenhouse gas emissions.” – Jenna Tatum
How long does an energy audit take?
An average energy audit takes 3–6 months to complete. Audits for larger and more complex buildings could take three to six additional months.
How long does a retro-commissioning study take?
The amount of time required for retro-commissioning depends on many factors, including the size and complexity of your building, seasonal considerations, and the nature and extent of any deficiencies. Our experts recommend starting the process 18-24 months in advance of your EER due date to allow enough time to correct deficiencies.
“If I could stress one thing, it’s to start the process 18-24 months before the deadline. Audits must be conducted over a portion of both the heating and cooling seasons, are time consuming, and require an enormous amount of work.” – Steve Wagner
“As an engineer who has conducted dozens of LL87 projects, we often encountered issues we thought would be inexpensive and quick to implement, but turned out to be more costly and time consuming. Therefore, begin as early as possible.” Da-Wei Huang
How can we find out about available incentives?
If your building meets certain requirements, it may be eligible for NYSERDA and Con Edison programs to help pay for the energy audit and implement the efficiency measures recommended in the audit. The consultant who performs your audit should be knowledgeable about available programs and provide a list of applicable incentives with their report. Your property manager can also consult with our FS Energy team for this information, or check the NYC Carbon Challenge Handbook for Co-Ops and Condos
, available to download at www.nyc.gov/mcc-multifamily
“The city has made a concerted effort to make properties aware of available financial incentives to help implement projects, bring down capital costs, and improve payback. Be sure your contract requires the auditor to provide written information on available financial incentives for each conservation measure recommended.” –Jenna Tatum