Hardwood Floors, Marble Countertops, and a High Energy Efficiency Rating

As cities force buildings to disclose energy use data, buyers and renters alike can factor it in to their spending decisions

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The Hearst Building in NYC, which is LEED Certified Gold (Flickr user Tom Mascardo 1 licensed under Creative Commons)

Anyone buying a building, leasing an office, or renting a condo is going to ask the usual questions: price, square footage, utilities, and parking fees. But what if buildings were also required to disclose a measure of how energy-efficient they are? Would consumers shop around, alongside great hardwood floors and natural lighting, for top-notch “energy use intensity”?

We are about to enter that era. New York City, San Francisco, Seattle, and Austin have all passed laws requiring buildings to start measuring and providing this information. The owners of large commercial and residential properties in New York, spanning some 2 billion square feet of real estate, began handing over their data this summer. And some buildings in Seattle and San Francisco will follow suit as of the first week of October.

As these “rating and disclosure” laws roll out, consumers will soon be able to browse the results on public websites (or at least to demand them when renting or buying a unit). And from there, it’s not hard to predict that this raw information will head where the rest of the open-data revolution has already gone: into third-party websites, integrated data sets and smart-phone applications. (How about, say, a geo-locating app that helps you identify only the most energy-efficient storefronts and restaurants to patronize? Or an apartment-hunting app that cross-references walkability with energy efficiency with proximity to Chinese takeout?)

“Right now, if you have an Energy Star label building, you’re going to put that on a plaque on the front of your building, and it will appear on a database,” says Cliff Majersik, the executive director of the Institute for Market Transformation that’s been helping cities craft these policies. As a consumer, he says, “right now you can find out the best buildings because they’ll advertise themselves.”

But no building advertises that it’s got embarrassingly bad energy efficiency. Plenty of buildings that probably have great efficiency don’t know it because they’ve never measured it. And then there are probably a few professed “green” buildings that won’t look so green once someone actually comes along and looks at the last 12 months of power bills (alongside a few other indicators).

Property owners have gotten on board with the idea because transparency sounds better to them than the alternative: regulation mandating minimum efficiency levels. Instead, this idea envisions a chain-reaction of events on the free market. First, consumers are armed with information. Then they start basing decisions upon it. Soon, inefficient buildings will fall out of favor, and their owners will be forced to upgrade to keep up. The footprint of whole cities could shrink this way, over time.

“We want to create a virtuous cycle of competition,” Majersik says. “We’ve seen this in Australia, where building owners compete to be the most energy efficient because it’s helpful in attracting tenants. And they’ve continuously raised the bar.”

Imagine a luxury-condo sales pitch promising a state-of-the-art fitness center, a 24-hour valet and an EPA Energy Performance Rating of 90. Majersik even envisions a scenario where the salesman then leans in and whispers, “you know, the building across the street is just a 60.”

About the Author

  • Emily Badger is a former staff writer at CityLab. Her work has previously appeared in Pacific StandardGOODThe Christian Science Monitor, and The New York Times. She lives in the Washington, D.C. area.