Guide to Local Law 97: Energy Audits, Timelines & Fines (2022)

Guide to Local Law 97: Energy Audits, Timelines & Fines (2022)

Understanding Local Law 97 and its Impact on Building Owners

In 2019, the New York City Council enacted the Climate Mobilization Act (CMA), an ambitious package of legislation aimed at reaching carbon neutrality by 2050. Much of the CMA’s scope—including Local Law 97 (LL97)—targets buildings, which account for over 70% of the city’s GHG emissions. Beginning in 2024, LL97 places stringent and increasing emissions limits on most buildings over 25,000 square feet. Buildings that exceed limits face substantial fines. This makes investments in energy efficiency retrofits and electrification the most economical pathway in many cases.

Who is impacted by LL97?

If you’re a building owner in the five boroughs, there’s a good chance it’s you. Approximately 50,000 residential and commercial buildings across the city—60% of total building stock—must comply with LL97’s requirements. With some exceptions, LL97 covers:

  • Buildings that exceed 25,000 gross square feet
  • Two or more buildings on the same tax lot that together exceed 50,000 square feet
  • Two or more buildings owned by a condo association that are governed by the same board of managers and that together exceed 50,000 square feet

Buildings will face annual fines of $268 per ton of emissions above the limit, with many facing multimillion-dollar penalties. 

How are the Emissions Limits Determined?

A number of factors go into determining the greenhouse emission limit per building. These include building usage classifications, occupancy levels and gross floor area. However, limits will not be based on volume, but on intensity. Specifically, it will be tons of carbon dioxide-equivalent (tCO²e) per square foot.

To address building owners’ need to understand their GHG emissions intensity, a burgeoning industry for energy audits is popping up. While New York City buildings over 50,000 square feet are required to conduct a building energy audit according to Local Law 87, all buildings can benefit from a greater understanding of their energy efficiency, output and performance. 

What is the Law’s Timeline?

Further, in order to most efficiently achieve the objective of the law—an 80% reduction of citywide emissions by 2050, commonly referred to as the 80x50 goal—the limits will increase over time. In practice, this will look like stricter limitations after 2030 compared to 2024-2029. Later limits will be published by the city on or before January 1, 2023.

It is expected that the most carbon-intensive buildings—approximately 20% of eligible buildings—will miss the mark in this initial period. 

By 2030, maximum emissions limits will be nearly halved with the aim of creating a 40% carbon reduction compared to 2005 levels. Today, 75% of buildings exceed this limit. Luckily, there are actions building owners can take today to prepare and protect themselves.

How Will Buildings Reach These Goals?

Energy efficiency and electrification measures that enable buildings to reduce or eliminate consumption of the most carbon-intensive fuel types are going to be the top priority. This will include updating oil or gas-burning furnaces or boilers to heat pumps, which run on electricity. Learn more about how BlocPower can help you in this process here.

Otherwise, builder owners will be able to purchase carbon offsets to satisfy up to 10% of a building’s emissions limit. Further, buying renewable energy credits (RECs) from energy generated or sunk into the NYC grid can offset up to 100% of emissions. Buildings may also have the opportunity to participate in a carbon trading marketplace, with a study due imminently from the Mayor’s Office of Sustainability

BlocPower's expertise enables building owners to take advantage of government rebates and incentives that will make it affordable to transition to LL97 compliance—and with flexible financing options, we’re ready to help you install a modern electric system.

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