Category: Decarbonization

Energy efficiency isn’t just about being green – it’s about identifying opportunity and protecting your business. From tax credits to experienced consultants, there are several ways to take advantage of energy efficiency to invest in the future of your building.

As our industry has grown, so has the benefits and potential for competitive advantage through efficiency improvement projects. Unfortunately, so have the misconceptions surrounding sustainable projects in commercial real estate. So, in honor of Energy Efficiency Awareness Month, let’s look at 5 common “myths” about energy efficiency and debunk them.

What Are Energy Efficiency Upgrades?

“Energy efficiency upgrades” or “energy projects” can mean many things. The overarching theme, as the name suggests, is that after the work is completed the building will perform more efficiently.

In practice, projects can take shape in many ways from LED lighting retrofits to energy monitoring to full-blown solar installations. The level of investment required of the building owner will vary from project to project, but the key is improvements to building performance.

Myth #1: Energy Efficiency is Too Expensive

In reality, there is a wide range of cost-effective efficiency upgrades, starting with no or low-cost measures like changing thermostat or occupancy sensor set points. Many energy performance upgrades and retrofits are eligible for tax incentives to lighten the burden of that initial cost. Even more, lots of projects have a relatively short payback period.

Take this audit and retrofit project for example. Green Econome conducted an energy audit and identified lighting, HVAC, and thermostat system inefficiencies across three manufacturing plants.

The project payback period was 1.2 years, and it received over $267,000 via the LADWP CLIP incentive. After the LED retrofit, thermostat, and HVAC upgrades, they saved an average of 25% on energy costs across the three buildings.

Myth #2: Older Buildings Can’t Be Efficient

Old buildings in many ways have the most to gain from energy projects. Since the equipment is often outdated, quick upgrades with proper planning and implementation could have an immense impact.

While building envelope upgrades can be much more involved, simple retrofits or even just energy audits could reveal opportunities for major improvements. The Hoxton Hotel in Downtown Los Angeles is a prime example of historic building projects.

Green Econome supported the Hoxton with incentive management, utilizing the California Energy Design Assistance (CEDA) program and the SoCal Gas Food Service Equipment Rebates. After the project was completed, the hundred-year-old building saw a 25% energy cost reduction and received $100,000 in incentives.

Myth #3: Efficiency is just about Saving Energy

Efficiency is much more than simply saving energy. According the Institute for Market Transformation, properties that are energy efficient will see occupancy levels up to 10% higher and sale prices up to 25% higher than less efficient properties.

Likewise, ENERGY STAR and its partners have helped Americans save over $500 billion in energy costs since 1992. This is why ENERGY STAR certification and other certifications are more than just a label – they represent improvements and savings in your buildings.

With more emissions-related laws being enacted, efficiency will also become a big factor for tenants. California’s SB 253 requires reporting of Scope 1, 2, and 3 GHG emissions. Energy used in a company’s leased building could fall into Scope 1 and 2 emissions, which will be disclosed via the California Air Resources Board (CARB). As corporations prepare to report, energy efficiency will be top-of-mind.

Myth #4: I Already Track My Energy Bills – That’s Enough

Simple utility tracking captures only part of the story. Detailed audits, benchmarking, and real-time energy monitoring identify hidden inefficiencies, operational waste, and tenant behavior patterns. These insights unlock savings that monthly bills alone will never reveal. Green Econome’s Building Performance Dashboard transforms energy consumption data into actionable performance insights.

Many cities have building performance ordinances that require large commercial properties to reduce their energy use and GHG emissions over time. We often see that buildings who don’t meet these building performance standards must then conduct energy audits. Why? Because they provide actionable data that go beyond an energy bill to show you where you can reduce emissions and save money.

Myth #5: Efficiency Projects Disrupt Operations

Modern energy upgrades can be phased to minimize impact, and many improvements (like lighting retrofits or smart building controls) are virtually seamless. With proper planning and coordination, tenants and staff can continue normal operations while projects deliver energy and cost savings.

This is when hiring a consultant can be massively beneficial because their whole job is to see the bigger picture and develop a plan that satisfies the needs of the building owner while ensuring effective project implementation.

Money Spent Now Equals Savings Over Time

You may be wondering – what’s the point of all of this? Of course, there is the environmental impact of these buildings being inefficient. However, there is also the business side of efficiency projects. Properties that are efficient save money on operating costs and increase property value.

Building efficiency is an opportunity, not a burden. It’s not just about saving kilowatts, it’s also about saving money, attracting tenants, and improving the longevity of your property.

Green Econome, a woman-owned, full-service energy and water efficiency construction and consulting company, has over 20 years of combined experience. Feel free to reach out to Green Econome’s founder and CEO, Marika Erdely, at marikae@greeneconome.com.

[UPDATED OCTOBER 2025] Let’s be honest, government writing is boring. These bills can be bothersome to read – I would be lying if I said I didn’t have to read it a few times before fully grasping its contents. That being said, SB 253 has an interesting framework that will improve transparency for businesses operating in California and their contributions to greenhouse gas emissions.  

SB 253 is one part of California’s Corporate Climate Disclosure Laws – the others being SB 261 and SB 219. In this post we will cover what needs to be reported, who needs to report, and the implications of the SB 253.

You should also see our post about SB 261, the adjoining senate bill regarding climate-related financial risk and our Guide to Updates to California’s Climate Disclosure Laws.

What’s the Purpose of SB 253 and Who Needs to Report?

The purpose behind this bill is to improve transparency and accountability amongst businesses that operate in California. The state recognizes that climate change poses a threat to companies’ long-term economic success and the value chains they rely on. Thus, emphasizing the importance of companies being transparent about their contributions to greenhouse gas emissions. 

However, this bill does not apply to all businesses across the state. Reporting entities are any businesses (corporations, LLCs, Partnerships, etc.) that operate in California and had more than $1 billion in revenue in the prior fiscal year. This revenue standard applies to the entire business, not only the revenue generated in California. 

Here’s the Specifics of SB 253

The California Air Resources Board (CARB) oversees the specific reporting requirements and ensures that the standards are updated as needed in the coming years.  

Under SB 253, the first report on Scope 1 and 2 emissions will be due in 2026 and annually thereafter. CARB is expected to require annual Scope 3 emissions reporting beginning in 2027.

Much of the language in SB 253 left the door open for the state to further develop these regulations and define what must be reported. The resulting companion bill, SB 219, updated the following aspects of SB 253:

• Companies with different subsidiaries can consolidate reports at the parent company level
• Allows CARB to receive GHG emissions report directly, rather than through a third party
• Allows CARB to set a distinct Scope 3 Emission reporting schedule. Originally they were required within 180 days of Scope 1 and 2 reports.

What Needs to be Reported?

Scope 1 Emissions: 

• All direct greenhouse gas emissions that stem from sources that a reporting entity owns or directly controls, regardless of location 
• Including but not limited to fuel combustion activities 

Scope 2 Emissions: 

• Indirect greenhouse gas emissions from consumed electricity, steam, heating, or cooling purchased or acquired by reporting entity, regardless of location 

Scope 3 Emissions: 

• Indirect upstream and downstream GHG emissions, other than scope 2 emissions, from sources the entity doesn’t own or control 
• May include but is not limited to:  
  • Purchased goods or services 
  • Business travel 
  • Employee commutes 
  • Processing and use of sold products 

What is the Timeline?

Additional Points to Consider

In addition to creating and publicly disclosing the reports, reporting entities must also engage with a third-party assurance provider to ensure accurate information. Larger companies are able to report at the parent company level meaning subsidiaries do not need to report individually. 

Upon submission of reports, businesses will also need to pay a fee to CARB that has yet to be set. If they fail to report, the board can distribute fines upwards of $500,000 depending on the case. 

If you are worried about reporting your first cycle, it is worth noting that CARB has issued an Enforcement Discretion Notice. Thus, for the first reporting cycle, reporting entities are only required to report information that they are already tracking at the time of the bill’s passing. 

How to Prepare

It is essential that businesses work on their data collection immediately and engage with reporting experts. Even though the first cycle has been slightly altered, these reports aren’t going anywhere. In fact, they are likely only going to become more extensive.

3 Ways We Can Help With SB 253 Compliance

1. Data Collection, and ENERGY STAR® Benchmarking 

The foundation of SB 253 reporting is in the collection of data and benchmarking energy, water, and waste use. Benchmarking helps you develop a baseline understanding of your property’s performance and prepares your data for reporting. 

2. Third Party Verification 

After collecting all the required data for a report, it must be verified and audited for accuracy and compliance. Green Econome acts as a third-party verification entity by scrubbing data to evaluate and verify a company’s greenhouse gas emissions. 

3. Consulting

If you are looking to further your emission reductions and save on operating costs, please reach out. Properties and businesses can save immense amounts of money by reducing emissions, lowering operating costs, and setting themselves up to report impressive data. Using the data collected, Green Econome can consult and provide businesses with strategic plans to increase efficiency and reach its savings goals.  

Green Econome, a woman-owned, full-service energy and water efficiency construction and consulting company, has over 20 years of combined experience. We can help explain these complicated tax benefits and make sure your property is getting the most from them. Furthermore, we can recommend solutions that will increase the NOI of your property and increase market value. Feel free to reach out to Green Econome’s founder and CEO, Marika Erdely, at marikae@greeneconome.com.