Boston is set to join a small but growing number of cities with plans to zero out carbon emissions from larger buildings, a move praised by environmentalists but raising concerns in the development community.
The City Council late last month approved a sweeping ordinance that will require all buildings 20,000 sq ft and up to become carbon neutral by 2050, with emissions standards ratcheting up progressively every five years.
Boston Acting Mayor Kim Janey plans to sign the bill this week, a spokesperson said.
The city becomes the fourth in the country to attempt to zero out carbon emissions from large buildings, which are a major source of greenhouse gases, with similar measures enacted in New York, Washington, D.C., and St. Louis.
Those larger buildings, while fewer in number, account for 60% of the city’s carbon footprint, said Emily Barkdoll, deputy director for strategy and engagement at the American Cities Climate Challenge “This ordinance was very much designed with ambitious but achievable goals,” said Barkdoll, whose organization provided technical advice on the drafting of the new law.“
Conor McGuire, director of sustainability at North Reading, Mass.-based construction manager Columbia, called the measure a "great and necessary step to address climate change and air pollution." He noted that the "greening of the grid with renewable clean energy is underway" and that during the next 30 years, "fossil fuel building systems will either fail and need to be replaced or owners will choose to upgrade systems as part of planned improvements."
But the Greater Boston Real Estate Board, which represents building owners and developers across the Boston area, has voiced some concerns..
Greg Vasil, its CEO and president, said the bill could place an unfair and unrealistic burden on owners, especially those with lower-rise buildings, that are many decades or even a century or more old.
The new ordinance would require owners of these older buildings to undertake expensive new retrofits at a time when the future of the office market has been impacted by the coronavirus crisis.
Companies are still trying to figure out how much office space they will need in the future, with older Class B and C buildings typically faring the worst in a soft market as commercial tenants seek better space in more modern high-rises.
These older office buildings are not all concentrated in downtown Boston, with a number in city neighborhoods and sections struggling to revive their business districts, such as Nubian Square, Vasil said.
Many older builders were also not required to report their emissions data under the city’s previous emissions tracking system, which was used to collect data, so they will also be faced with starting the collection process, he added. City officials and Synapse Energy Economics used the data to draw up the emissions’ reduction performance targets laid out in the newly-passed ordinance.
“A lot of the Class B and C buildings … never had to report under the old (system),” Vasil said. “This is going to be a punch in the gut.”
He is also concerned about potential city penalties, arguing that daily fines, which can rang up to $1,000, could add up to more than $300,000 per year.
Vasil said he would like the fines used to help property owners undertake the expensive work involved in reducing emissions.
Under the new ordinance, at least part of the money collected through penalties would be used for “rent stabilization” at low-income affordable housing where tenants may be facing displacement or eviction.
“How about rent stabilization for the commercial building owners who are struggling in a down market and can’t get the money they need to make these conversions?” Vasil asked.
Another concern is whether there will be enough energy options for building owners to purchase renewable energy certificates to mitigate some emissions, with most local power likely to still come from fossil-fuel sources by 2030.
Vasil points to potential impact of the standards on plans for new office and residential buildings, arguing they would drive up the cost and possibly deter some developers from moving forward.
“We have been dealing with skyrocketing prices – everything from wood to plasterboard – it would be another cost,” he said.
NAIOP Massachusetts, which represents building owners and developers across the state, said it has worked with city officials to build flexibility into the ordinance.
Building owners and others faced with financial challenges to meet the new standards can seek council permission for hardship modifications or changes. Those reporting emissions data for the first time also can file for a six-month extension.
One provision the development group pushed for will allow members of the review board, many of whom will be representing community organizations, to draw upon a working group of industry experts who can offer advice in cases of financial hardship and other issues, said Anastasia Nicolaou, vice president of policy & public affairs at NAIOP Massachusetts.
The group plans to continue to offer input as implementing regulations are drafted. “This ordinance is a great first step, but it is certainly not the last step in the process,” Nicolaou said.