The New York City Department of Buildings reported to City Council this month on the first Local Law 97 compliance period. Around 95 percent of market-rate buildings either met their emissions cap or took a recognised compliance step. Sixteen properties paid penalties, totalling approximately 270,150 dollars.
Read quickly, that looks like a law working smoothly. Read properly, it is a warning about the Local Law 97 2030 cap.
Period one was set where almost everyone already sat
Local Law 97 was passed in 2019 and applies to buildings over 25,000 square feet, assigning carbon caps to 60 property types on a per square foot basis. The caps tighten across five compliance periods, running from 2024 to 2049, before a zero emissions requirement in 2050.
The 2024 to 2029 caps were set at a level most buildings could reach without structural change. The penalty numbers show it. Sixteen properties paid roughly 270,150 dollars between them, an average of about 16,900 dollars each. At the statutory rate of 268 dollars per tonne of carbon dioxide equivalent above the cap, that implies an average overshoot of around 63 tCO2e a year.
Sixty-three tonnes is a rounding error on a commercial building. It is the kind of gap that closes with controls tuning and a boiler service.
The Local Law 97 2030 cap is a different instrument
Most Scope 3 Category 1 data is still based on a mix of averages, emissions factors and lifecycle databases. It is the best available approach in a lot of cases. But it does create a situation where the biggest part of your footprint is also the least specific.
Take two dairy farms supplying into the same processor. One has invested in feed changes, better fertiliser use, maybe some work around soil and grassland management. The other is running in a more traditional way. Those two farms are not the same from an emissions point of view. But if you are using regional averages, they basically show up as the same thing in your reporting.
Offsets are not the exit
Carbon offsets may be used against up to 10 percent of a building’s emissions. In the first period, fewer than 1 percent of properties used that route. Owners planning to buy their way to compliance in 2030 should note both the cap on the mechanism and how little it has been used in practice.
Laura Popa, deputy commissioner of sustainability at the Department of Buildings, described the agency’s stance as a supportive approach to enforcement, with studies under way that may change how compliance is handled. Supportive enforcement of a lenient cap is not a guide to what happens under a strict one.
What US owners should do now
Carbon offsets may be used against up to 10 percent of a building’s emissions. In the first period, fewer than 1 percent of properties used that route. Owners planning to buy their way to compliance in 2030 should note both the cap on the mechanism and how little it has been used in practice.
Laura Popa, deputy commissioner of sustainability at the Department of Buildings, described the agency’s stance as a supportive approach to enforcement, with studies under way that may change how compliance is handled. Supportive enforcement of a lenient cap is not a guide to what happens under a strict one.
Sixteen penalties across an entire city says the 2024 cap asked almost nothing of building owners. With 57 percent of properties already above the 2030 limit, the second compliance period tests the building itself rather than the reporting.
