John Petro
Reducing NYC’s Carbon Footprint Through Energy Efficiency
As the New York City Mayoral campaign heats up this year, it is likely that the economic meltdown and the impending budget crisis will be the issues that receive the most attention. However, the next Mayor will be faced with an even larger problem than the economy: global climate change. Way back in the spring of 2007, Mayor Bloomberg announced the goal of reducing the city’s carbon footprint 30% by 2030 and released the plan that would set the city on the course to meet that goal.
If the city is to truly take action to reduce its carbon footprint, it will have to focus on reducing the amount of energy used in buildings. Buildings – and the energy used to heat, cool, light, and power the appliances in them – represent 77% of the city’s CO2 emissions. Nationally, about 32% of CO2 emissions are from buildings. This is likely because the city has far fewer transportation-related emissions than most of the country, but it is also a reflection of the city’s older building stock. The median age of a residential unit in New York City is 75 years; 43% of the city’s housing stock was built before 1939.
This makes a strong case for retrofitting the city’s older building stock to increase energy efficiency. But how is the city government meant to devise policies that will encourage private building owners to retrofit their buildings? Although retrofits will save the property money over time through lower energy bills, they require a large amount of capital up front. Additionally, property owners may be reluctant to invest in energy efficiency improvements because if the owner sells the building, they may not capture the savings from the efficiency improvements.
The City of Berkeley has implemented a policy that mitigates these concerns. The Berkeley FIRST program is an innovative funding mechanism that assists homeowners and businesses install solar power systems on their properties. The model could be used in New York City to assist building owners with energy efficiency retrofits. Berkeley FIRST essentially allows property owners to borrow funds to install solar photovoltaic systems on their residential or commercial property and repay the cost of installation (plus interest) over a period of 20 years through their property tax bills. In addition to defraying the high upfront cost of solar installation, the program has another benefit for property owners. Since the solar system stays with the property, so does the tax obligation. If the property is transferred or sold, so is the remaining tax obligation.
To encourage even more retrofits, a Berkeley FIRST-type program could be combined with a Residential Energy Conservation Ordinance (RECO). RECO’s require that before a building is renovated, sold, or transferred it meet certain energy efficiency requirements. In this scenario, building owners who wish to sell their properties must make the energy efficiency improvements first, but once sold, the cost of the improvements would be paid by the new building owner over 20 years. Ideally, the energy savings would cover the cost of the payments.
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Posted at 3:01 PM, Feb 02, 2009 in
Energy & Environment | Urban Affairs
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