How two major cities are fighting climate change

Chicago Nightscape The Chicago, IL skyline at night. Photo by Jon Herbert, via Flickr.

Climate action plans—sets of strategies designed to reduce greenhouse gas emissions and other negative environmental impacts—play a critical role in realizing a community’s vision for sustainability. While dozens of cities have such plans, few have the supplemental programs necessary to set them in motion. However, there are leader communities that are making notable efforts on implementation. Chicago, IL and Boulder, CO are two of those cities, and they are using benchmarking and pricing to reduce carbon emissions.

Chicago’s energy benchmarking program

In 2013, the Chicago City Council approved a proposal from Mayor Rahm Emanuel to create the Energy Benchmarking Program, which requires all commercial, residential, and municipal buildings larger than 50,000 square feet to monitor and report their energy use. Energy benchmarking poses little cost to the city and positions building owners and tenants to make more informed energy choices, which can then feed a regional green jobs industry.

“Good data drives markets and innovation,” says Mayor Emanuel. “This ordinance will accelerate Chicago’s growth as a capital for green jobs by arming building owners, real estate companies, energy service companies, and others with information they need to make smart, cost-saving investments.”

The Energy Benchmarking Program’s primary goal is to promote better energy decisions by highlighting the amounts of energy the biggest buildings in the city are using and the potential large savings that could be achieved through energy efficiency measures. Another goal is to spur jobs in the green energy sector, as the market for energy efficiency grows.

About 3,500 buildings—less than 1 percent of the city’s building stock—are required to comply with the energy benchmarking program, but these structures account for roughly 20% percent of the city’s energy use. According to the Alliance to Save Energy, buildings are responsible for 71 percent of Chicago’s carbon emissions—and if the largest buildings begin to use energy more efficiently, the city may reach its climate goal of reducing greenhouse gas emissions 25 percent by 2020, compared to 1990 levels.

Energy use will be reported using the Energy Star Portfolio Manager, an online tool for tracking building energy use. Buildings using this tool have average energy cost savings of 7 percent, according to the U.S. Environmental Protection Agency. All energy usage data will be made publicly available. Figures must be audited and verified every three years by an engineer, architect, or other energy professional approved by the city. Building owners must carry their own costs for monitoring, reporting, and verifying energy use, but there are provisions for buildings under financial distress and buildings with occupancy below 50 percent. The City is providing free training sessions for building owners and a hotline for questions regarding the program. Newly constructed buildings are not required to report their energy use, because the City requires all new construction to adhere to 2015 International Energy Conservation Code standards.

The ordinance only mandates the reporting of energy use, not the implementation of energy efficiency improvements, but the public sharing of records may be enough to spark change. Building owners will be able to compare their energy use with that of similarly sized buildings, allowing efficiency comparisons. Prospective tenants, buyers, and investors will have the ability to see which buildings have higher energy costs. This information will help drive the market towards more energy efficient buildings. Municipal and commercial buildings will be phased in first and multifamily buildings will have until 2016 to start complying.

Other large cities requiring energy benchmarking include Washington, DC, Seattle, WA, Boston, MA, and Minneapolis, MN. Washington, DC and Boston also include water usage as part of their benchmarking programs, and Seattle requires all buildings over 20,000 square feet to report energy usage, but the programs across the nation are otherwise similar.

Boulder’s Carbon Tax

According to Jonathan Koehn, Boulder Regional Sustainability Manager, Boulder, CO gets 70% of its electricity from the burning of coal. The City has adopted one of the more aggressive plans in the nation to mitigate carbon emissions, and it has created a dedicated funding stream for implementation through a pioneering policy. In 2006, Boulder instituted a “carbon tax” on the use of electricity generated from fossil fuels—the first policy of its kind in the United States.

“Many communities have climate action plans that lay out the ways they are going to reduce their emissions, but they are left in this void of understanding, ‘How do we pay for these things?’” says Koehn.
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The tax is levied on residential, commercial, and industrial energy users, and those who use less energy pay less. The average annual tax paid is $21 for homeowners and $94 for commercial owners. Most of the revenues come from the industrial sector, where the average annual bill amounts to $9,600. Renewable energy sources such as wind and solar are exempted from the tax.

The carbon tax generates about $1.8 million each year, according to the City, and these funds go toward implementing the Boulder Climate Action Plan. Proceeds also help to fund public education, energy audits, energy consultants to help residents and business owners identify energy inefficiencies, investments in public transit and multi-use recreation trails, and rebates for those who make investments in energy efficiency improvements at home and at work.

Creating a dedicated funding stream has been key to making the Boulder Climate Action Plan a success. Boulder has slowed its greenhouse gas emissions and achieved one of the highest rates of installed solar capacity per capita in the country, according to a report produced by the City.

Benefits like these have helped secure the public’s support for the carbon tax. In 2012, 82 percent of voters chose to extend the tax program for another five years.

Neha Bhatt contributed to his article.

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