New York City began enacting extremely ambitious, performance-based climate laws for commercial buildings with the passing of Local Law 97, sometimes known as NYCLL97.

One of the ten bills included in the Climate Mobilization Act of 2019 is NY LL97, which puts New York City on a path to reducing greenhouse gas emissions. Using buildings’ emissions in the calendar year 2005 as a baseline, NY LL97 mandates that the city’s largest commercial and industrial buildings reduce their emissions by 40% by 2030 and 80% by 2050.

According to the Progressive Caucus of New York, “Large buildings are the largest offenders of climate pollution in New York City because outdated and inefficient systems squander massive quantities of energy.

In addition to the social and environmental advantages of NYC LL97, decreasing emissions by incorporating clean, renewable energy into a building’s overall energy strategy may also benefit building owners financially. Compliance with LL97 also facilitates environmental, social, and corporate governance (ESG) scrutiny, which is becoming increasingly important to enterprises all throughout the country. The risk and opportunity profile of a business can be represented by its ESG ranking, which can also affect how easily it can obtain financing and show that it is capable of building long-term value.

These buildings are required to comply

Existing structures, new construction, and significant renovations are all covered by the law. It states that covered buildings under LL97 must meet one of the following criteria: I a building that exceeds 25,000 gross square feet; (ii) two or more buildings on the same tax lot that collectively total more than 50,000 gross square feet (9290 m2); or (iii) two or more buildings held in the condominium form of ownership that collectively exceed 50,000 gross square feet (9290 m2).

When Does NYC LL97 Start?

In 2024, LL97 carbon limits go into force. Covered structures will be required to provide reports detailing their 2024 carbon emissions starting in 2025. Buildings will be punished if their carbon emissions exceed the determined limit. To guarantee that metrics and goals are met, strict reporting standards and deadlines are laid forth year after year. Building owners who don’t comply risk yearly fines in the millions of dollars. For every metric tonne over the necessary limit, for instance, a fee of up to $268 will be implemented annually. Additional fines may also be levied for fraudulent, erroneous, or late reporting.

What Requirements/Conditions Apply to NYC LL 97?

As seen in the figure above, Local Law 97 sets building emission limitations with a tiered approach to CO2 reduction through the year 2050. Starting in 2025, all buildings subject to the regulation are required to submit an emissions intensity report to the Office of Building Energy and Emissions Performance on May 1st of each year. Applications for alternative methods of compliance, such as adjustments to emission caps, deductions for the purchase of greenhouse gas offsets or renewable energy credits, deductions for the use of distributed energy resources, and adjustments for special categories of buildings or for special uses and occupancies, will be reviewed by the Office and may be approved. Because initiatives for emissions analysis, benchmarking, and reductions take time and resources to implement.

Local Law 97 in NYC Overview:

  1. For covered structures in New York City, NYCLL97 regulates CO2 emission restrictions. About 57,000 structures in New York City are impacted by NYCLL97, which goes into effect in 2024. By 2030 and 80% by 2050, the law mandates a decrease in building-based emissions of 40%.
  2. The law specifies standards for the 2024–2029 and 2030–2034 first compliance periods. For certain types of structures, such as city-owned buildings and churches, alternative compliance alternatives are permitted. These include purchasing greenhouse gas (GHG) offsets and renewable energy credits (RECs), as well as using distributed energy resources (DERs). Beginning in 2025, building owners are in charge of compliance and must submit annual emissions reports.
  3. Because this bill affects both new construction and significant renovations in addition to existing buildings, it is more rigorous than comparable rules in the U.S.
  4. The penalties include failing to file a report, a false reporting punishment of $500,000, and a penalty for noncompliance of not more than $268 per metric tonne of CO2 that exceeds the annual building emissions limit.
  5. The law creates the Office of Building Energy and Emissions Performance, which is tasked with guiding the application of NYCLL97 and calling a board of advisors to offer suggestions on long-term planning for sustainability and ongoing GHG reductions.
  6. By 1/1/21, the Office of Building Energy and Emissions Performance must also submit a Carbon Trading Study pertaining to a system of carbon trading for the entire city.

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