Cities can make energy efficiency programs green and equitable

New resource for incorporating equity into energy benchmarking policies for buildings

In recent years, cities have taken the lead in the fight against climate change. Many have passed benchmarking and transparency ordinances as a foundational step to measure—and reduce—the amount of energy buildings use. Now, with renewed federal action on climate, cities will have more resources to invest in efficiency programs. And in this time of increased attention to racial justice, there is renewed urgency for cities to address long-standing inequities.

A new guide from the City Energy Project—Incorporating Equity into Energy Benchmarking Requirements: Guidance for Policy and Program Practitioners—can help cities meet this moment by leveraging benchmarking and transparency policies to help advance racial and social equity.

Benchmarking, in this context, means tracking energy use in buildings—giving owners the information they need to set and achieve efficiency goals. Transparency—making energy-use data public—helps tenants choose more efficient buildings, providing a market-based incentive for building owners to do better.

Benchmarking and transparency policies are an essential part of a city’s efforts to reduce carbon emissions and slow the pace of climate change. That’s because buildings are the single-largest user of energy in the United States, accounting for about 40 percent of total energy consumption. Indeed, if U.S. buildings were their own country, they would rank third in the world in energy use. And cities that have implemented benchmarking policies have seen 3 percent to 8 percent reductions in energy use across participating buildings.

“It’s a pretty foundational climate policy with a lot of benefits,” says Caroline Keicher of the City Energy project: “Building owners and tenants can save money on utilities, businesses can reduce operating costs, tenants can have information to make more informed choices, and everyone benefits from cleaner air and healthier buildings.”

However, without including equity into policy design and implementation, these policies can have consequences that exacerbate harm and further burden struggling families. For example, if cities neglect to identify the most energy-burdened communities when developing their benchmarking ordinances, policies may not include the support structures needed to ensure that those bearing the greatest burden actually benefit from newly efficient buildings. And the voluntary building improvements that these policies are intended to encourage can boost property values and potentially increase rents, leading to displacement and gentrification, especially for communities of color and other marginalized families.

So, how can cities leverage the benefits of benchmarking, while reducing—rather than exacerbating or maintaining—inequities? That was the question the City Energy Project hoped to answer. The now-concluded Project was a joint initiative of NRDC (Natural Resources Defense Council) and the Institute for Market Transformation, with funding from Bloomberg Philanthropies, Doris Duke Charitable Foundation and The Kresge Foundation.

Over nine years, the Project helped launch benchmarking and other energy efficiency programs for buildings in nearly two dozen cities and counties across the U.S. Many “alumni” cities have gone on to pursue even more ambitious climate policies for buildings and continue to provide models for other cities to emulate. Nearly half of the cities currently participating in the American Cities Climate Challenge—a current initiative supported by Bloomberg Philanthropies—were previously in the City Energy Project.

To answer the equity question, the City Energy Project and Upright Consulting Services brought together a cohort of practitioners, including cities from both the City Energy Project and the Climate Challenge, to generate ideas and learn from one another. “There’s not some easy answer that can be dropped down in any context,” says Jeremy Hays of Upright Consulting Services. “You have to get in and wrestle with the tough questions.”

Those conversations informed the new guide, which spotlights cities that are leading the way on incorporating equity into benchmarking policies. The guide also summarizes key concepts and issues at the intersection of equity and building policies and contains guiding questions for practitioners to work through.

And the guide shows how cities are using benchmarking data to better understand policy impacts, energy burden and health metrics, to better target outreach and resources to buildings and people most burdened, who stand to benefit most from health improvements and lower energy bills.

Several cities are already making progress in this area, providing helpful examples for other cities. In Minneapolis, for example, buildings in communities doubly burdened by pollution and poverty now receive priority support through the city’s Green Cost Sharing Program. The program helps building owners improve living conditions and efficiency while maintaining affordability, even as they comply with benchmarking requirements. Almost $5 million has been spent through the program as of February 2021.

In Denver, the city’s Climate Action, Sustainability and Resiliency department is creating a tool to identify under-resourced buildings to target for efficiency investments and support. The tool will layer data from the Greenlink Equity Map (GEM) platform, existing energy burden maps, and current work with Denver’s Office of Social Equity and Innovation (SEI), as well as data generated by the benchmarking and transparency ordinance. The Energize Denver Task Force, a diverse group of stakeholders from across the city, will help select the indicators to identify which buildings should be included and/or prioritized for targeted support on policy compliance and other energy efficiency initiatives.

And in Seattle, city staff use the City’s Race and Social Equity index to prevent disproportionate fining of people of color and community-based organizations, as well as struggling businesses and building owners. Staff identify buildings that are not complying with the benchmarking ordinance and use the equity index to locate them, in order to better provide necessary support or exemptions for those who need to comply. Seattle is also working to broaden the economic benefits of energy efficiency, by partnering with a local community college to pilot workforce development programs in building energy auditing and efficiency tune-ups.

The need—and opportunity—to leverage climate action to address past inequities and to protect and benefit struggling communities has never been clearer. By applying an equity lens to benchmarking policies and the impactful building policies for which it lays the foundation, cities can fulfill their duty to serve the public by designing energy policies that are sustainable and equitable.

Laurie Mazur is the editor of the Island Press Urban Resilience Project, which is supported by The Kresge Foundation and The JPB Foundation. Her writing has appeared in Quartz and The Hill.