Insights Archives - Green Econome

Audit Not Required: LA EBEWE Phase II A/RCx Exemptions

March 20, 2023 Marika Erdely

We talk to many building owners and property managers asking what happens if they do not comply with the Phase II Audit/Retro-commissioning (A/RCx) stage of the City of Los Angeles Existing Buildings Energy & Water Efficiency Program (EBEWE) Ordinance. You can read about the fines and penalties for non-compliance here. But, we want people to understand that energy and water exemptions can be met to avoid the cost, time, and labor of ASHRAE Level II audits and retro-commissioning reports. It’s easy to miss the fine print on the notices sent by the Los Angeles Department of Building and Safety (LADBS).

"You may be exempt from performing an A/RCx for energy and/or water if your building falls under the specific exemptions provided in Division 97 of the LAMC. To be considered for an exemption, a request and supporting justification must be submitted by a California licensed engineer or architect to LADBS.”

How to Know if You Qualify for an EBEWE Exemption

We prioritize these least-cost options to save money and provide value to each of our EBEWE clients. After we complete the benchmarking of a building, we deliver a custom progress and goals report which, using the metrics from ENERGY STAR® Portfolio Manager®, illustrates the building’s benchmarked energy and water efficiency performance. The report then outlines all EBEWE Phase II compliance options based on the previous 5-years performance of that building. Surprisingly, often buildings can meet at least one or both energy and water exemptions. The table below shows the Phase II compliance schedule and comparative periods used to determine exemptions.

* The initial compliance due dates for Building IDs ending with 0-3 were impacted by the COVID emergency order tolling of deadlines and are now subject to the reissue due date of September 7, 2023.

Why do EBEWE A/RCx Exemptions Matter?

The cost of meeting an exemption can be up to 65% less than receiving an ASHRAE Level II energy and or water audit and RCx report. Additionally, if you’re meeting an exemption you have a high-performing building, which is contributing to the city’s goal to reduce carbon emissions, and you operate an efficient building, congratulations. If you are eligible, you can also gain ENERGY STAR Certification which can help with the lease rate and marketing of your property.

What do I Have to do to Submit an EBEWE A/RCx Exemption?

Hire Green Econome of course! Whether our team completes it for you or not, here are the basics:

The building must be accurately benchmarked with no estimated data. LADBS requires a CA Professional Engineer or Licensed Architect to validate the results.
Once the exemption is met (reduction verification, ENERGY STAR Certification, etc) a declaration of exemption must be signed by the Licensed Professional and submitted through the LADBS online portal.
Compliance must be met every 5 years, with benchmarking required every year. Since that data is required, it’s best to always stay current on your energy and water benchmarking disclosure compliance.

Of course, you can pay for an audit that someone else tells you is required without considering these exemptions. Not all Service Providers ever mention these exemptions, because their entire approach is to sell you into an audit.

Since the tolling of EBEWE deadlines has been lifted, and the due date is now September 7, 2023, it is time to get moving. Depending on the exemption, it can take 6-8 weeks to complete, so have your building benchmarked if it hasn’t been brought up to compliance and see if it can meet any exemptions.

JUST ANNOUNCED: LADBS will be accepting 2023 ENERGY STAR Certifications for Building IDs 0-3 who need to comply by September 7^th. This is a huge win that Green Econome advocated for. It allows building owners who may not meet a reduction target but are eligible for Certification to still gain that recognition and exemption, where their only other option would have been an A/RCx report. Thank you Los Angeles!

Marika Erdely is the founder and CEO of Green EconoME. Before founding the company, she was CFO/VP at New Millennium Homes, a major home builder, and land developer, bringing with her nearly thirty years as an accounting professional. Marika has her Contractors License B & C-10 and is a LEED AP BD+C, Certified Energy Auditor, and Fitwel Ambassador. Marika holds an MBA from Pepperdine University and a BA in Business Economics from UCSB.

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Insights

What are the fines if I don’t comply with EBEWE Phase II A/RCx?

March 20, 2023 Marika Erdely

Lots of property owners and managers have received a Notice to Comply with Audits and Retro-Commissioning requirements of the Los Angeles Existing Buildings Energy and Water Efficiency (EBEWE) Program. Many property owners and managers properly comply, but many do not. What happens if you don’t comply?

LADBS has provided comprehensive EBEWE Audits & Retro-Commissioning FAQs. Penalties are outlined in item 17, page 9:

17. What are the penalties if we don’t comply?

SEC. 91.9712 of the EBEWE ordinance puts the non-compliance fee at $202. This fee may be subject to Late fees, Collection fees and interest as defined in LAMC SEC. 98.0411. “Pursuant to L.A.M.C. Section 98.0411 (c), if this invoice is NOT PAID within 30 days of the date of the invoice, an additional 250% late charge/collection fee will be imposed and assignment to a collection agency may be made. After 60 DAYS of NO PAYMENT, interest will accrue at the rate of 12% annually (compounded monthly or portion of a month) until this invoice and any additional charges that have accrued since this invoice was issued have been paid.” Please note that payment of the non-compliance fee does not result in Compliance. The building will remain out of compliance with the City of Los Angeles and, as with any Los Angeles Municipal Code violation, will be subject to further legal action. Additionally, the status of each building (Complied or Not Complied) is posted publicly and, in the future, may be recorded on the property as an open violation.

The Case for Submitting Your EBEWE A/RCx Requirement

Yes, the fine is minimal at $202, but I find it interesting that it notes that the building will remain out of compliance with the City of Los Angeles and, as with any Los Angeles Municipal Code violation, will be subject to further legal action.

Hmm, I wonder with our new Mayor, what this will ultimately mean to those unwilling to be accountable to this Ordinance?

As a reminder, benchmarking a building is similar to determining the financial condition of your property. If it is scoring on the lower half of the ENERGY STAR® scoring of 1 to 100 (with 100 being the best), it shows that the building is energy and water inefficient, which ultimately means someone, you or your tenant(s) are spending too much on costs to operate the building. Of course, inefficient buildings create carbon which isn’t good for our atmosphere, which is the entire point of the EBEWE Ordinance.

But, besides all of that, why wouldn’t you want to understand how your property is performing so you can improve its NOI? It just makes financial sense. Contact us for pricing, or to get started with your EBEWE compliance.

About Green Econome

Green Econome is a woman-owned, small business providing energy and water efficiency compliance, consulting, and construction services for commercial real estate. Our Los Angeles-based team of licensed and credentialed professionals takes an integrated approach to finding efficiency solutions that positively affect market valuations, reduce environmental impact, meet ESG and sustainability goals, and ensure regulatory compliance.

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Prioritizing ESG in Commerical Real Estate

Decarbonization Insights

Prioritizing ESG In Commercial Real Estate

November 22, 2022 Marika Erdely

The latest focus in sustainable commercial real estate is on “Environmental, Social, and Governance,” also known as ESG. ESG has received attention from regulators and investors, and, according to a recent report from Deloitte, “sustainability has become a strategic imperative across industries”. Real estate professionals need to begin focusing on how ESG can impact portfolios and policy. Let's identify:

What is ESG and how will it affect commercial real estate?
How will the Inflation Reduction Act benefit my real estate portfolio?

Here is a simple table identifying some of the elements of ESG:

Setting the Standard: The SEC Proposed Ruling

Soon, public companies will need to report on the three ESG categories, also known as an ESG Strategy, to their investors. The SEC’s proposed Rule on Climate Disclosure gives companies a roadmap for ESG reporting and requires disclosures related to climate-related risks that could have an impact on their businesses, whether it’s their day-to-day operations or a financial impact on their real estate assets.

The SEC proposed reporting will be part of the public corporation's quarterly and annual disclosures and will detail the company’s carbon footprint and include reporting on greenhouse gas emissions from real estate and the climate-related risks to those assets. At NAREIT’s ESG conference I attended this fall, several panelists suggested that insurance companies and banking institutions will be considering climate disclosures in their financial metrics. Additionally, it was mentioned that investors from the European Union would also be looking at ESG disclosures when considering investments in the U.S. Most public companies have been focusing on their ESG strategies, and the process of gathering data for this year’s ESG disclosures is already underway.

Privately-Held Companies and Building Owners Can Benefit

What about private companies, and the private commercial real estate owners that lease to space public companies? Private owners should also focus on having an energy-efficient property and should not ignore the trend toward ESG.

The “E” in the ESG framework stands for “environmental,” which refers in part, to real estate and the efficiency of buildings. All buildings emit carbon emissions, and these emissions (in the forms of kWh and therms) can be broken down into three kinds: Scopes 1, 2, and 3.

Scope 1: Direct emissions that stem from sources that are owned, or controlled by the organization, such as company vehicles and the fuel they burn, process emissions from industrial activities, leaks from refrigeration, etc.
Scope 2: Indirect emissions that arise from the generation of purchased electricity, heating, cooling, and steam (Any utility bill creates emissions such as electricity or gas used by the building)
Scope 3: Other indirect emissions that are directly from the supply chain of goods and services that the public company purchases. (This is the largest scope and most complicated coming from the organization’s operations, purchasing and selling goods, such as leased assets, business travel, and employee commuting)

Initially, Scope 1 and 2 emissions will be required to be disclosed by the SEC. However, public companies will soon be mandated to report Scope 3 emissions as well.

Mandated reporting means that if you have a tenant in one of your buildings that is providing products to a public company, the tenant will soon have to be reporting on their building’s emissions and activities. There will then be an effort to reduce those emissions, even if your building is not operated by a public company.

How Do You Measure Your Property’s Emissions?

As with anything new, standards and protocols are being established, along with a host of innovative technologies to harness data. As a trusted platform, Green Econome utilizes ENERGY STAR® Portfolio Manager, which gives owners data that can be used to calculate the property’s total emissions. The EPA is actively developing the platform further, to better meet the demands of GHG accounting and scope emissions reporting.

Green Econome takes a systematic approach to ESG, along with a team of advisors, we measure, identify opportunities, implement, and analyze results to ensure you are on target to achieve your environmental goals. If building certification is part of your strategy, we can fulfill those as well.

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Inflation Reduction Act: Tax Strategies and Incentives for Property Owners

There’s good news! There are many financial benefits from the new Inflation Reduction Act of 2022 (IRA) to commercial property owners and developers.

Personally, I like the investment tax credit (ITC) known as the federal solar tax credit and the fact that it is now back up from 26% to 30% of the total project cost through 2033. Currently, our solar pv projects are benefiting from 58% of the project cost being covered by this tax credit and federal and state depreciation deductions.

Section 179 (a tax deduction) of the IRA provides owners with a dollar amount per square foot if the commercial or residential building meets a certain efficiency standard. Owners can earn $5 per sq. ft. for new construction or retrofitting a building, depending on its resulting energy efficiency. It is a laddered benefit ranging from $2.50 sq. ft. for a 25% reduction in energy usage up to a maximum of $5.00 sq. ft. for 50% or more.

For multifamily landlords, Section 45L (a tax credit) allows up to $5,000 per unit (single-family or apartment) if the building meets certain energy efficiency criteria.

What's In It For Commercial Real Estate?

Energy-efficient buildings will be worth more and will be more attractive for public companies concerned about emissions. Soon, everyone will be thinking about ENERGY STAR Benchmarking —a viable tool to produce data for reporting on your building’s performance.

ENERGY STAR Benchmarking is already widely used for energy and water disclosure laws across the county (and Canada). You can view IMT's national map of programs currently in place.

As an expert in reducing commercial property emissions, I anticipate a big push to move real estate into the world of ESG reporting, which goes a long way toward environmental sustainability. Once the SEC finalizes its ruling, all public companies will be required to focus on the “E” on their buildings like never before. Additionally, I believe that when companies also consider the “S” for Social and “G” for Governance, they will ultimately be better stewards of the planet.

If you need an expert to understand your building’s energy or water efficiency and emissions, please reach out to me at Marika@greeneconome.com. At Green Econome, a team of professionals is ready to help you meet your ESG requirements, save operating costs, and increase the value of your property.

Marika Erdely, MBA, LEED AP+C, Certified Energy Auditor, Fitwel Ambassador
MarikaE@GreenEconome.com
(818) 681-5750

Marika is an expert in energy and water efficiency and is the Founder and CEO of Green Econome, an energy consulting and construction company located in Santa Monica, CA. Marika has over 30 years of professional financial experience and approaches sustainability through an economic lens.

Decarbonization Insights

Inflation Reduction Act: A Cheat Sheet

October 13, 2022 Karalyn Shima Honea

Sunworks Solar Power: Surge of new solar projects predicted, following the passage of the Inflation Reduction Act

The energy sector, among many others, has been preparing for the transition to clean energy for a while now. While strides have been made, the roadmap has been less than straight. The passage of the Inflation Reduction Act (IRA) steadies the wheel and gives consumers clear direction. So, how do we get to cleaner energy? The following blog from our friends at Sunworks Solar Power succinctly explains what the IRA includes, and how organizations of all shapes and sizes can access new incentives and choices to achieve the highest return from solar, storage, and electrification projects.

READ BLOG

Sunworks Solar Power (2022, September 23). Surge of new solar projects predicted, following the passage of the IRA – Sunworks. Sunworksusa. https://sunworksusa.com/surge-of-new-solar-projects-predicted-following-the-passage-of-the-ira/

Building Performance Standards Insights

What is the EBEWE A/RCx Requirement?

June 16, 2022 Marika Erdely

I have been receiving many phone calls asking this same question since the City of Los Angeles sent notices to building owners on June 1, 2022. The notices were sent to owners whose properties are over the 20,000 sq. ft. threshold and were tagged to comply with the City’s Existing Buildings Energy and Water Efficiency (EBEWE) Program. Within this threshold, the notice was sent to those required to comply with Phase II of the Ordinance and have an LA City Building ID ending in either a 2 or a 3. These properties have a Phase II compliance due date of December 1, 2022.

What is an Audit and Retro-commissioning (A/RCx) Report?

This is the second year of compliance for the City’s EBEWE Phase II which is required every five years after the initial compliance year.

Audits and Retro-commissioning (A/RCX) for both energy and water are required including performing the evaluations and generating the subsequent ASHRAE Level II reports. All work for Phase II must be done under the direct supervision of a California licensed engineer or architect as specified in Division 97 of the Los Angeles Municipal Code (LAMC).

The audit reports must include recommendations to improve the energy and water usage efficiency and a cost-benefit analysis for retrofitting the properties.

Do I Have Options?

Yes! Little does everyone know, although it is noted in item 2. of the notice, that a property may be exempted from performing the A/RCx.

There are in fact energy and water exemptions that can be met to avoid a costly ASHRAE Level II audit. Contact us to learn more. Stay tuned for Blog 2

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Green EconoME Utility Incentives Consulting

Financing Insights

Top 3 Utility Incentives for Saving Energy

March 17, 2022 Karalyn Shima Honea

At Green EconoME we are passionate about saving building owners and operators energy, on their energy costs and maximizing their capital investments. That’s why we cringe when people tell us they finished a project and didn’t take advantage of any of the many available utility incentives. Right now, utility incentives and tax benefits for energy efficiency and clean energy generation are the vehicle that governments are using to mobilize clean energy goals. What motivates you to make improvements to your commercial real estate is yours. What matters to us is that we each benefit from the actions we take, and that those actions hold long term value.

Utility Incentives 101

Utility incentives are financial and sometimes technical support available to specified projects or equipment. They can be offered by the utility directly, a program administrator, or are publicly administered programs. This year, there has been a shift toward centralizing some incentives and programs to be available across California, rather than at the regional utility level. This shift marks California’s response to clean energy mandates and helps distribute funds equitably to all utility customers. It creates a bigger funnel for end-user incentives and rebates to assist with efficiency, renewables, resilience, EV infrastructure, and building decarbonization. Confused? Call us.

Our Top Three California Energy Saving Incentives

Aside from not knowing about available incentives, another barrier simply is that there are so many options, decision-making can be difficult. Here are some key programs that, from our experience to date, are easy to manage, pay well, and have a stable stream of funding:

LADWP Commercial Lighting Incentive Program (CLIP)This is offered through LADWP directly to its qualifying business customers. CLIP is for lighting retrofit projects where the building has an annual average monthly electrical demand (kW) above 200 kilowatts. Every efficiency project Green EconoME has completed has included LED lighting retrofits. We leverage this incentive where we can, and consistently see on average 30% savings on the total project cost.
SoCalREN Multifamily Program (SCR)The County of Los Angeles administers the Southern California Regional Energy Network (SoCalREN) programs. The SoCalREN offers financial assistance to public agencies and multifamily residential property owners for energy efficiency retrofits impacting both electric and gas use. Green EconoME has served as a consultant and contractor on several SCR multifamily retrofit projects over the past 2 years. See our Case Studies for results. We have seen energy savings exceed program requirements, and have been awarded further program credits.
California Energy Design Assistance (CEDA) ProgramCalifornia Energy Design Assistance provides complimentary energy design assistance and financial incentives for commercial, public, industrial, agriculture, and high-rise multifamily new construction projects, or major alterations that are in their early design phases. The goal of the program is for buildings to be designed efficiently from the start, thereby realizing lifelong savings and less environmental impact. CEDA helps the design team identify the most energy efficient strategies through custom energy modeling, then helps the owner implement those measures through incentives to reduce cost. CEDA, along with LADWP’s Zero By Design (ZBD) understands that every team is different and allows room for the professionals you bring to the project to complete some or all of the work, as long as it meets set criteria.

Tax Benefits

A powerful 1-2 punch is combining utility incentives with tax deductions like Section 179D, and the CARES Act Qualified Improvement Property (QIP), which allows for accelerated depreciation, while the solar tax credit (ITC) is a full credit off the owner’s tax liability. A clean energy future, regardless of how we feel about it, is the direction California is already moving. Local, state, and federal policy around clean grid infrastructure and lowering carbon emissions can strain property owners, which is why these robust incentives are available, being widely funded, and introduced at a rapid pace. Green EconoME has been helping clients navigate and manage available incentives for their projects, ensuring the richest paybacks possible. Schedule a meeting to discuss your current or future projects.

CONACT US TO START SAVING

Green EconoME is a full-service provider. Our team of multidisciplinary, qualified professionals can fulfill your 1-5-10 and are versed in the latest incentive programs and financing options. It is what our integrated approach is based on. Whether your goal is to simply comply or to fulfill ESG strategies, Green EconoME analyzes energy use, and existing conditions to provide solutions that reduce operating costs, and increase the value of your property. Contact us with questions or for pricing. Chula Vista, we are so excited for the health and future of your community, congratulations! We can’t wait to get started.

Decarbonization Insights

Top 4 Reasons to Pay Attention to ESG Now

November 3, 2021 Karalyn Shima Honea

Discover the opportunity for Commercial Real Estate in corporate accountability.

ESG, or Environmental, Social, and Governance is a set of standards used to evaluate an organization or community’s commitment to sustainable (Environmental), ethical (Social) practices, and outlines how those goals will be measured and achieved (Governance). Driven in large part by the boom of ESG or sustainable investing, it is important to look at the wider implications this has, specifically for commercial real estate.

You don’t have to be courting investors, or publicly traded to implement ESG strategies. The bottom line is this is the direction the world is moving. From our perspective, here are four important reasons to consider real estate ESG:

Altruism and profitability are not mutually exclusive
Operating a more environmentally friendly and equitable company/building reduces waste, cuts cost, and increases efficiency, according to 2019 McKinsey & Company Research. As an energy efficiency consulting and construction firm, this is top of the list for Green EconoME when it comes to reasons to invest in ESG.
Attract top talent & tenants
Unless you plan to go the way of the dinosaur, formalizing your corporate values and commitments and applying them to your assets will keep you competitive. Make no mistake, prioritizing ESG is a choice, just like the one your prospective tenant, lender, future employee, or buyer will make when considering you and your properties.
Plan ahead: policy and the role of ESG
Globally and locally, regulation is expanding to meet science-based goals for climate action and social responsibility. While ESG or related benchmark reporting isn’t yet mandatory, just like ENERGY STAR(r) benchmarking, ESG data is becoming a leading performance indicator for real estate, and inevitably will become a standardized source of data for government-based carbon reduction targets or other asset assessments.
Data in, reporting easy
The modalities and data collected for ESG measurement are being integrated into risk assessment, financial reporting, and other annual real estate-related requirements. ESG is proving to be a reliable source for centralized data collection that serves the purpose of many. Think of the ways this can increase the efficiency of your organization.

As much as ESG is seen as a trend, it is so because it is at the tipping point of a new paradigm defining this generation and generations to come. It is a framework to approach this decade of action that we are in. The space between energy efficiency, the main business model for Green EconoME, sustainability, and carbon reduction is growing closer, rapidly. Accounting for the impact of your business on its community and the value of who makes it hum is not only responsibility, it's economic success. If you are ready to start your ESG journey, or if you have more questions about ESG, please reach out to Green EconoME.

Decarbonization Insights

3 Benefits of Green Infrastructure

August 25, 2021 Mandy Reinhart

With the Senate passing the $1.2 trillion infrastructure bill, it is apparent that there is a collective vision of redefining and modernizing our built environment. There is a call to action on how we adapt to meet the needs of future generations. We are reeling with the long-term domino effects of urban sprawl. Socioeconomic inequality, poor building design, limited reliable public transportation, and a decline in public health has brought us to a tipping point. We must prepare to revitalize our cities, retrofit our existing buildings with energy-efficient measures, and reconstruct our transportation networks.

Cleaning Up Our Existing Buildings

The existing building sector is responsible for 29% of GHG emissions, with 40% coming from inefficient HVAC systems. If buildings in Los Angeles are expected to reach net-zero carbon by 2050 as a part of the C40 pledge, there needs to be immediate action. Building systems – electrical, lighting, heating, ventilation, and air-conditioning must be retrofitted to the highest energy efficiency standards. Or better yet - break the ceiling on them.

Government subsidies and utility incentive programs need to be more accessible to building owners so they can invest in on-site power generation for their buildings, such as solar PV and batteries. We can then contribute clean energy to our outdated electrical grid and create the demand for green jobs. While we have the innovative technologies that can support such a system, there also needs to be innovative policy reform that will build these self-sufficient power systems to be scaled to the neighborhood level.

Another upgrade that building owners and citizens benefit from is the installation of a cool roof, which reflects sunlight and absorbs less heat than traditional asphalt shingles. Urban heat islands caused by non-reflective material can cause the ambient temperatures to be artificially elevated by more than 10 degrees in our cities. Dense concentrations of pavement from streets, parking lots, and roofs absorb direct heat, thereby increasing the HVAC usage and exacerbating air pollution, contributing to the poor air quality present in high-density urban areas.

Access For All

Cities thrive when they are made of well-connected neighborhoods, with reliable transit, safe bike paths, and sidewalks made for the pedestrian.

In addition to constructing sustainable buildings, we need to construct smart buildings. Buildings integrated into their surrounding streets through mixed-use design, incorporate a balanced mix of institutional uses that stimulate local economies and increase the use of public services.

There needs to be a push for creating smart circulation networks within cities and neighborhoods that incentivizes walking, biking, and public transportation. This can only be accomplished if it is less challenging to alter zoning ordinances, urban growth boundaries, and rate of growth controls. Through smart growth planning, we can adapt to our changing environment and effectively prepare for a growing population. Transportation is a primary culprit in the progression of climate change. It accounts for 29%of all greenhouse gases in the United States, and it is also one of the fastest-growing emission sectors. Leapfrog development patterns make driving even short distances necessary, due to the extensive lengths of blocks, architectural design of shopping centers, and the extensive parking requirements required to support vehicles.

One of the most powerful statements I have heard is “frequency = freedom”. The frequency of a reliable bus, light rail, subway, gives its citizens the freedom to go where they want and at whatever time they need to. It is both unsustainable and unrealistic to expect equality in a city where every citizen needs their own automobile to get to their next destination.

Becoming a Pioneer of Change

It is vital that we construct an equitable environment for all, and create space for opportunity, growth, and city-wide resiliency. It is our responsibility to meet the needs of future generations and be the leaders of innovative strategies that respond to our climate crisis. Buildings are the foundation of cities. They are a place where people work, create, and collaborate to make the impactful decisions that design our future environment. We need existing and future building owners to take responsibility for their building’s carbon footprint and be held accountable to make responsible decisions in their building operations.

How do we galvanize a community to be the pioneers of an environmentally equitable city through decarbonization and smart growth planning? We need to make citizens and building owners aware of how crucial buildings are in reversing climate change, cleaning our air, and the potential economic savings that come from a carbon-neutral building. Cities do this by working directly with building owners, engaging in public outreach, and being educators.

Mandy Reinhart, LEED AP Neighborhood Development, Fitwel Ambassador, has earned her BS in Environmental Sciences with a Minor in Sustainability. She is passionate about urban planning and studying neighborhood design. As Assistant Project Manager at Green EconoME, Mandy can be found working with clients out in the field, moving their efficiency goals forward.

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Building Performance Standards Insights

Guide to LA EBEWE Phase II A/RCx Requirements

February 4, 2021 Karalyn Shima Honea

Los Angeles Existing Buildings Energy and Water Efficiency Ordinance (EBEWE): Phase II – What to Expect

If your building is a covered building and ≥20,000 sq. ft. (a.k.a. needs to comply with EBEWE), then you should have a few years of ENERGY STARⓇ benchmarking under your belt. If not, stop reading and call us immediately at (424) 422–9696! In addition to your annual benchmarking, every five years you are required to show that you have either maintained a high-performing building or are taking steps to become one. Our job is to keep you informed, efficient and in compliance. Your job, when it comes to Phase II, is to make sure you have an efficiency budget in place and enough time to comply by your unique due date.

Below, we’ve outlined the program and Phase II compliance. We’ve also included an infographic for you visual learners, and some tips to comply:

EBEWE Program Summary

Local Policy: Los Angeles’ Green New Deal

Phase I Benchmarking Report: Due by June 1, annually

Phase II Performance Report: Due by December 1, every five-years based on the last digit of your LADBS Building ID

Program Fees: LADBS registration fee + surcharge for benchmarking is $66.41 / building / year, and $183 per audit/RCx confirmation submittal (subject to change)

SEE IF YOU ARE EXEMPT

The EBEWE Phase II Requirements

For Phase II, Building owners must either complete an ASHRAE Level II audit and retro-commissioning (RCx) OR meet one of the exemptions noted below before their compliance due date, which is determined by the last digit of the building’s LADBS Building ID.

EBEWE_Chart — https://www.betterbuildingsla.com/_images/content/EBEWE_Ordinance_Brochure.pdf

Prescriptive Path

a) ASHRAE Level II Audit
The in-depth identification and documentation of a building’s energy and water-use equipment. Audits examine existing conditions to pinpoint potential areas of improvement for energy and water efficiency. Must meet or exceed ASHRAE Level II standards.

b) Retro-commissioning (RCx)
RCx is the re-tuning and maintenance of existing systems (energy and water). Your ASHRAE Level II audit will list recommended RCx measures. It will be important to have an implementation plan and budget in place prior to your due date.

Performance Path

Buildings that do not have to go through an Energy Audit and Retro-commissioning qualify for one of the following exemptions:

ENERGY STAR Certification: The building has received this certification from the EPA for the year of the building’s compliance due date, or 2 of the 3 years prior.
For buildings not eligible to receive an ENERGY STAR score, the building must perform 25% better than the national median of similar building types. This data is available through your benchmarking reporting.
The building has reduced its Source Energy Use Intensity (EUI) by 15% when compared to the five years before a building’s compliance due date.
Buildings that do not have a central cooling system must retrofit four of six prescribed energy efficiency measures noted in the EBEWE guidelines (available upon request).

Water Exemption to the Audit and Retro-commissioning:

Buildings that meet one of the below exemptions do not have to go through a Water Audit and RCx:

The building has reduced its water use intensity by at least 20% when compared to the five years prior to the building’s compliance due date.
Buildings that do not have a central cooling system must retrofit two of three prescribed water efficiency measures noted in the EBEWE guidelines (available upon request).
The building’s water use conforms to the LA Municipal and Title 24 Code in effect at any time during the five-year compliance cycle.
The building is new and has been occupied for less than five years from its occupancy date based on the Temporary or final Certificate of Occupancy.

*All exemptions must be certified by, or performed under the supervision of, a California licensed architect or engineer.

Know the Facts: Compliance Tips

Don’t be fooled into believing your building MUST receive an audit to comply. Not all buildings need to be audited. The price of an ASHRAE Level II audit can be significantly higher than available exemptions, so make sure you are being advised on the most efficient and cost-effective Phase II path to compliance for your building(s).
Performance metrics rely on twelve months of actual energy usage and information about the operations and physical characteristics of the building’s type and use. If this information is estimated or defaulted in your benchmarking report, the metrics will not be correct. Make sure your building has been accurately benchmarked.
As you see, this isn’t something that can be done quickly, or for free. If you need more information on creating a budget or financing options, call us.
Cities throughout the state (and country for that matter), also have local energy efficiency policy. If you have buildings outside of LA, make sure you are in compliance by checking our 2021 Guide.

As part of Green EconoME’s compliance services, we offer a consultation on the report's results, which includes an explanation and recommendations for energy efficiency improvements and how to meet EBEWE Phase II compliance. We will always make recommendations in the best interest of your building, budget and efficiency priorities.

Contact Green EconoME to meet your compliance requirements.

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Decarbonization Insights

Everything You Need to Know About Decarbonization

November 30, 2020 Karalyn Shima Honea

Human activities such as burning coal and fossil fuels have led to increases of roughly 90% in carbon dioxide emissions and 78% in greenhouse gas emissions globally since 1970. As of 2014, the United States is responsible for nearly 15% of that CO2. The five highest polluting sectors are energy production (grid), land-use (deforestation, agriculture), transportation, industrial activities...and buildings.

Across the globe, the above statistics are widely understood. The fact that it is our responsibility to solve and clean up the problem is also widely understood. Local, federal, and international energy policies have aligned with deep decarbonization targets by 2050. In an effort to meet these goals, collaborative programs, coalitions, and think tanks are energized, creating coordinated solutions across the private sectors.

These coordinated efforts along with meaningful change, are fundamental to adopting a paradigm shift. In this article, we hope to offer a clear understanding of what decarbonization is, and a strong business case for why becoming part of the solution works, no matter where you place the value.

Defining Decarbonization

Decarbonization is the process of removing carbon. The act of decarbonization, or to decarbonize is to reduce or eliminate greenhouse gas emissions in order to address atmospheric pollution and meet climate goals. This is the basis of the decarbonized economy.

The Decarbonized Economy

Mobilized by climate policy, a decarbonized or low-carbon economy uses clean power sources and practices to lower greenhouse gases, specifically carbon dioxide output into the atmosphere. The need to deploy clean energy strategies with speed and to scale, stimulates research, innovation, job creation, and economic growth. Additionally, a decarbonized economy prioritizes ecosystem resilience, including not only biodiversity but humanitarian issues.

What are the benefits of a decarbonized US economy, specifically? The World Resource Institute compiled data that shows clear economic benefits to decarbonization.

It’s cheaper to save the planet than it is to ruin it. Low-carbon technologies have become more efficient and affordable compared to fossil fuels.
US clean energy investment and deployment are creating approximately twice as many jobs as those in fossil fuels.
Net-zero means net-savings for the US. Despite the trillions in spending projected for 2050 emissions targets, energy revenues are greater. Morgan Stanley Research released data on how decarbonization will strengthen the economy, as well as listed their 5 recommended investment strategies.

Strategies for Decarbonization

So how are we going to do this? The strategies to achieve deep decarbonization nationally and globally are wide and well, deep. For example reforestation, carbon capture, family planning are all ways to offset and reduce emissions. For our purposes, let’s focus on our business: strategies for decarbonizing buildings.

Building decarbonization is segmented into embodied carbon, which in simple terms are the cumulative emissions from construction and operational carbon which are the emissions from the use of a building. The primary strategies in operational decarbonization are:

Decarbonize the grid. The grid is the biggest culprit of GHG emissions. Our blog about SCE rate increases spotlights how our aging infrastructure is sparking hazardous weather events, and how utilities are depending on their customers to help upgrade and electrify the grid with clean, renewable energy.
Electrification of buildings. Switching from fossil fuels (burning natural gas) to electric is another key component to moving the needle. So much so that new building codes are being implemented in certain cities, like Berkeley, CA, banning the installation of natural gas lines. Fuel switching incentives, coming in 2021 for multi-family and single family homes, will be another tool, enabling customers to move from carbon-emitting gas appliances to cleaner electric ones.
Self-generation. Solar, battery storage, and other scalable renewables can move you to net-zero the moment it goes live.
Retrofit to cleaner, next-gen units. The implementation of green technology is pivotal to the progress that needs to be made. One household, one building at a time truly does make the difference.

These strategies are mainly focused on operational decarbonization; however, it’s important to be embodied and operational inclusive. Even with retrofits to existing buildings, coordinating design, new technologies, methods, and deeper savings through synergistic measures will increase the value and efficacy of the project.

Climate Transition: Environmental Effects of Decarbonization

Globally, if we can accomplish this mid-century deep decarbonization we will make strides in restoring our vital ecosystems for a millennium. If as a nation we can overcome the barriers we face to take action, we can, year by year reverse the climate crisis we already experience through increased and costly events such as wildfires, flooding, hurricanes, pandemics, and heat waves. Climate change is interconnected with human development as well. Stabilizing temperatures stabilize our crops and food supply chain. Energy efficiency benefits everyone, but especially low-income families. Making cleaner, low-cost energy available in poorer communities ensures energy security and access to healthier environments inside homes and neighborhoods.

Your Path to Decarbonization

Green EconoME founder and CEO, Marika Erdely is invested in getting customers to their decarbonization goals and inspired by getting to net-zero. “The ability to eliminate gas in a building, replace it with electrical equipment, add solar PV, and a storage battery and then go off the grid while also reducing ongoing operating costs is exciting. Electrical costs will continue to rise, but if we are able to add the generation and storage factor to the building, we will be able to offset these increases in costs. To get to a net-zero carbon building would be fantastic!” Marika speaks in detail on this topic on the Building the Future podcast. Multi-family residential is one good example of a property type where we see opportunity for deep savings and impact on the community. Paired with the SoCalREN incentive program, decarbonization of the building and providing low-cost energy to each tenant is achievable.

Marika is also Co-Chair of the New and Existing Building Committee of the USGBC, LA Chapter, Decarb Committee. A collaboration of Los Angeles’ energy leaders, their mission is to transform the way buildings and communities are designed, built, and operated. Schedule a personal Q&A to explore and get started on becoming part of the solution.

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