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New York City has cause to celebrate this Earth Day with the passage of the Climate Mobilization Act, which includes a law addressing the carbon footprint of the city’s buildings. As part of its commitment to fighting climate change, New York City is seeking to slash greenhouse gas (GHG) emissions from buildings—a vital step, as buildings generate approximately 70% of GHG emissions in the city. The law requires large buildings (over 25,000 square feet) in New York City to stop wasting energy and achieve 40% cuts in pollution by 2030. The goal: cut climate pollution by 40% by 2030, and over 80% by 2050.

The law will deliver several important benefits:

  1. JOBS: Energy efficiency upgrades require hands-on work, by lots of local workers. Weather-stripping; lighting and insulation upgrades; modernized boilers and HVAC systems can provide thousands of good, local jobs, right in the communities that need them the most.
  2. AIR QUALITY: Better efficiency means less energy consumption, and that will reduce the burning of dirty fossil fuels in building boilers and at nearby power plants. That means cleaner air for everyone.
  3. ENERGY COSTS: More efficient buildings use less energy, which can result in lower utility bills.

The Energy Efficiency for All New York (EEFA NY) Coalition is excited to see such ambitious legislation passed, but efforts must continue to ensure that benefits are felt by all. Specifically, the legislation has exempted a significant share of multi-family buildings in order to prevent the costs of building upgrades from displacing low-income tenants. While this exemption is an understandable near-term solution given the city’s housing affordability crisis, it will only exacerbate the housing quality deficit in the long term for communities of color and low-income New Yorkers.

In the new efficiency mandate, buildings containing rent-regulated housing face less stringent requirements and some affordable housing is completely exempt.  While these exemptions are necessary in one sense, given that state rent regulations allow some of the costs of efficiency improvements to be passed on to residents, we need a solution that addresses the outsized impacts of climate change faced by under-resourced communities. In New York City, residents of affordable housing often live in the city’s oldest buildings, with inadequate insulation, leaky windows, and inefficient heating and cooling systems. These problems lead to unhealthy living conditions and high energy costs, and climate change will continue to make them worse.

The unfortunate consequence of delaying efficiency implementation for affordable multi-family housing is that it also delays the benefits from reaching communities that need them most, including improvements to renters’ health, safety and comfort.

To address those consequences and ensure all New Yorkers receive the benefits of energy efficiency, there are two key issues that must be addressed:

1)  Current NY State rules allow building owners with rent regulated units to recover the cost of certain building improvements from tenants through rent increases. Owners often end up collecting more than the actual cost of these improvements since many energy efficiency measures pay for themselves over time through reduced utility bills, but rents are raised in perpetuity. This framework resulted in the different treatment of rent-regulated buildings in the legislation. However, if these buildings are not ultimately required to similarly reduce their GHG emissions, New York City will not be able to meet its climate goals and low-income households will continue to live in substandard housing. These rent regulations are up for review and renewal in 2019 by the NYS legislature.

2)  Many building owners may lack access to capital to make the efficiency upgrades that will most benefit tenants (and reduce GHGs the most). The City and State could provide loans, technical assistance and other support to help owners of affordable housing invest in necessary upgrades. Funding efficiency work on buildings with rent-regulated units will reduce pollution, lower tenants’ energy bills, make living spaces more comfortable and prevent rent-increaseskeeping housing affordable.

Making affordable rental housing more efficient is a cost-effective way to reduce energy consumption, reduce pollution, maintain housing affordability, and create healthier, more comfortable living environments. The implementation of the Climate Mobilization Act could pave the way for energy-efficiency in rent-regulated housing and affordable housing—IF these buildings aren’t left behind.