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Friday, June 14, 2013, 12:45 pm

Building energy disclosure rule delayed until September

State says it moved because compliance tool set to go offline

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    The California Energy Commission on Thursday delayed until Sept. 1 energy-use benchmarking that will be required before sales, full-building leases and financing of California commercial buildings larger than 50,000 square feet, expanding to smaller buildings next year, under a new state law.

    The postponement came because the primary tool for compliance will be offline for upgrades as the first phase of the regulations were to take effect.

    Under the Nonresidential Building Energy Use Disclosure Program (www.energy.ca.gov/ab1103) — better known by its enacting legislation, Assembly Bill 1103 — building owners will have to give a prospective property buyer or full-building tenant three reports from the U.S. Energy Department’s Energy Star Portfolio Manager online software at least 24 hours before execution of the sale or lease. A prospective lender would have to receive those documents along with the loan application.

    Also, a compliance form is submitted to the California Energy Commission.

    But the regulations released by the commission in February require action earlier than 24 hours. At least 30 days before the sale, lease or loan request, the property owner must have created a free Portfolio Manager account or updated it with the most recent 12 months of energy-use data from the utility or energy provider.

    AB 1103 takes effect for 50,000-plus-square foot buildings first, for those larger than 10,000 square feet on Jan. 1 and on July 1, 2014, for buildings larger than 5,000 square feet, the smallest for which Portfolio Manager will generate a 1–100 score. Multifamily housing is excluded from the compliance requirement.

    Compliance software to be offline

    Energy Star benchmarked buildings

    The number of buildings nationwide with Energy Star Portfolio Manager benchmarking data is approaching 300,000.

    Energy Star Portfolio Manager has more than 250,000 buildings and 40,000-plus owner accounts in its database and is the mandated tool for commercial building energy performance benchmarking and disclosure requirements nationwide.

    The U.S. Environmental Protection Agency has been preparing a major upgrade to Portfolio Manager for a few years. The system was set to go offline for the upgrade June 26–July 9, later extended through July 16.

    Pacific Gas & Electric Co., the main energy provider in Northern California, had been recommending owners of large buildings needing to close a deal before July 15 complete the benchmarking process and print reports from Portfolio Manager before the shutdown, according to spokeswoman Katie Key.

    PG&E’s system for automatically transmitting building and preauthorized tenant utility bill data to Portfolio Manager won’t be working during that time, she added. That data exchange has been operational since early last year and is feeding information on as many as 8,000 buildings.

    770 and 790 Lindaro St., San Rafael - San Rafael Corporate Center - Seagate Properties

    Seagate Properties has been using Energy Star Portfolio Manager to apply for ratings on its first two San Rafael Corporate Center office buildings since 2008 and is obtaining ratings on these two new buildings BioMarin Pharmaceutical occupies. (image credit: Seagate Properties)

    San Rafael-based Seagate Properties has been manually exporting spreadsheets from PG&E and importing them into Portfolio Manager for the three San Rafael Corporate Center office buildings with Energy Star ratings so far, according to Dale Tate, property general manager. The first two buildings in the development have been rated since 2008, and one of the two newest office buildings received its first rating this year.

    Seagate will apply for a rating on the other new 75,000-square-foot building, 770 Lindaro St., after October, when full-building tenant BioMarin Pharmaceutical will have had its headquarters there for 12 months, Mr. Tate said.

    Tenant privacy

    Privacy of tenant operational information has been a sticking point in the development of AB 1103 regulations, according to commission documents. The state’s utility company said hampering their ability to pull in tenant energy-use data are the commission’s “15/15 rule” and its privacy rules for “smart grids.” The 15/15 rule says that aggregated data, such as for a given property, must be larger than 15 customers, or tenants, and no single customer’s usage, or “load,” can be more than 15 percent of the aggregated load.

    Privacy concerns led to a measure in AB 1103 regulation, adopted in December, that building owners can’t use the data for any other purpose than compliance with this rule. But whether the 15/15 rule applies to AB 1103 still hasn’t been resolved, according to Ms. Key of PG&E.

    “PG&E is not applying 15/15 to AB 1103 at all, because it is complicated to implement and would apply to only 2 percent of the AB 1103 buildings in our service area,” she said.

    That means only small fraction of the applicable buildings have more than 15 tenants, and an unknown proportion of that have tenants that carry more than 15 percent of the building, she added.

    The regulations do say tenants must supply energy data for AB 1103 compliance, yet some real estate attorneys have been noting that lease language should include energy bill disclosure authorization language.

    ‘Growing trend and wakeup call’

    Energy Star commercial and residential building benchmarking by state

    Energy Star Portfolio Manager commercial and residential buildings benchmarked by state

    California is the second U.S. state to pass a commercial building energy performance benchmarking and disclosure requirement, following Washington’s 2009 law for buildings larger than 10,000 square feet that took effect in January 2011, according to the Institute for Market Transformation and BuildingRating.org. Vermont, Massachusetts and Tennessee have been considering it.

    Craig Isakow

    Craig Isakow

    “It’s definitely a growing trend and a wakeup call for commercial building owners,” Craig Isakow, director of commercial solutions for WegoWise. One of the Boston-based energy-efficiency consulting firm’s services is automating the process of moving building and tenant utility bill information into Portfolio Manager.

    San Francisco’s Existing Commercial Buildings Energy Performance Ordinance has required such reporting on 10,000-plus-square-foot structures since 2011 and includes disclosure to current tenants and on a public website. Other cities with commercial property energy disclosure measures are Austin, District of Columbia, Minneapolis, New York, Philadelphia, Seattle and, as of next May, Boston.

    “These laws require all types of owners, whether leading or laggard in energy efficiency to have a (Portfolio Manager) score,” Mr. Isakow said. He compared the forced dissemination of commercial building energy scores to miles-per-gallon reporting required for automobiles, a metric consumers eventually came to use as a comparison tool at the time of purchase.

    Training on compliance

    PG&E is set to hold free morning and evening classes July 15 and again on Aug. 16 at its Pacific Energy Center in San Francisco on benchmarking of commercial buildings to comply with AB 1103 (pge.com/mybusiness/edusafety/training/pec/classes/index.jsp). The four-hour morning class “Benchmarking Your Commercial Building” covers the requirements of the new law. The 3.5-hour afternoon class “You’ve Benchmarked Your Building — What’s Next?” is set to explore how to use the data to plan for and analyze cost-effective improvements.

    The morning classes provide four hours of Green Building Certification Institute continuing-education credit toward the LEED Credentialed Maintenance Program and American Institute of Architects credit for health, safety and welfare or sustainable design training. The afternoon classes provide 3.5 hours of credit.

    PG&E earlier this month posted video tutorials on benchmarking and is preparing a written step-by-step manual.


    Amplification, July 2, 2013: The U.S. Environmental Protection Agency said today that the Energy Star Portfolio Manager application will be offline through July 16, instead of July 10, to ensure the data is migrated to the new system accurately.

    Correction, June 19, 2013: PG&E’s data exchange won’t be operational while Energy Star Portfolio Manager is offline. Incorrect information was provided earlier.

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