Introduction

The US Federal government's actions to mitigate the climate crisis—including regulations, investments, and legislation—tends to be well-publicized. However, cities across the country are also looking to reduce greenhouse gas (GHGs) emissions at a local level; more than 600 local governments have set targets and formed a climate action plan, and they’re increasingly targeting building emissions. 

Reducing emissions at the city and municipal level is crucial for mitigating the climate crisis. Cities account for approximately 70% of GHG emissions, making them critical to our collective decarbonization journey. The buildings sector in particular is responsible for a significant portion of total greenhouse gas emissions. Including building electricity use, buildings constitute more than 30% of the total GHG emissions in the United States. In New York City, the largest city in the US by population, emissions from buildings comprise almost two-thirds of the total municipal emissions.

Taking a closer look at enacted emissions management policies across four major cities in the United States (New York, San Francisco, Boston, and Seattle) sheds light on how these laws are likely to affect businesses and the climate.

A comparison of building emissions laws in four major US cities:

How cities are capping building emissions

Seattle recently joined New York, San Francisco, and Boston in adopting a building emissions reduction policy. In December 2023, Seattle Mayor Bruce Harrell signed the Building Emissions Performance Standard (BEPS), which establishes greenhouse gas intensity targets (GHGITs) for buildings larger than 20,000 square feet. 

All of these cities require parties such as building owners, condo associations, and other implicated parties (“Building Owners”) to disclose the emissions footprint of their buildings, and with the exception of San Francisco, they also require Building Owners to cap their emissions based on building size. New York introduced these caps in its 2019 law, and Boston (through a 2021 update) and most recently, Seattle have followed. This growing trend indicates emissions caps appear likely to arise in future municipal building laws.

These laws also set forth fines of varying size and structure for Building Owners' failure to comply with the applicable reporting and emission cap obligations. New York’s penalties for non-compliance are based on the emissions overshoot, whereas Boston, San Francisco, and Seattle charge a fee based on the size of the building for non-compliance with the emissions cap.

Regulators anticipate the impact of these laws on the climate to be substantial The Seattle Office of Sustainability and Environment (OSE) estimates the enactment of BEPS will result in a 27% reduction in greenhouse gas emissions from the building sector by 2050, which accounts for 37% of Seattle’s core emissions according to the latest inventory. 

While the enactment of these laws may have been controversial, Carbon Direct expects they are here to stay. In the case of Seattle, BEPS is aligned with the state-wide regulation for energy use in existing buildings, the Washington Clean Buildings Performance Standard (WA CBPS). Similarly, the New York City Local Law 97 (LL97) is supplemented with the New York State Climate Mobilization Act of 2019, which sets GHG emissions limits for buildings over 25,000 gross square feet. Such alignment across multiple levels of government in these states makes these policies more resilient to the turbulence of local elections.

Recommendations for compliance

To ensure compliance with these policies, Building Owners should seek out qualified GHG accounting professionals to conduct emissions footprint assessments of their buildings. Having a robust baseline will help Building Owners better understand and manage their impact and major sources of GHG emissions. 

The parties implicated by these laws should develop emissions management plans, which may include the procurement of carbon reduction and removal credits, to help them meet their emissions targets. This work is complex and requires a deep understanding of markets, policies, and stakeholders, highlighting the need to take action now.