How Co-ops and Condos Can Pay for Retrofits to Reduce Building Emissions

With his tenure scheduled to expire in eight months, Mayor Bill de Blasio has rolled out his parting climate wish list. It includes a joint purchase with New York state of Canadian hydropower and an expansion of geothermal energy through a city-run utility. In an interview with Crain’s, Ben Furnas, the newly appointed director of the Mayor’s Office of Climate and Sustainability, says there will be a “sprint” to enact climate initiatives during the twilight of the de Blasio administration, including assistance to co-op and condo boards that must meet building emission caps set by the Climate Mobilization Act. What follows is an edited version of the interview.  

Building owners (including co-op and condo boards) will face fines beginning in 2024 if they do not comply with the Climate Mobilization Act, requiring they cut carbon emissions. How is the city helping the real estate industry prepare?

With Local Law 97, we are not interested in fining people. We are interested in using fewer fossil fuels. One example is the NYC Accelerator, which is really designed to be a one-stop shop for building owners to get the assistance they need. There are financing tools such as PACE – property-assessed clean energy – that offer favorable terms and sometimes no money down at all for a loan on energy retrofits or clean-energy installation, helping those buildings come into compliance. Then it gets paid back on their property-tax bills.

(Editor’s note: The long-awaited application process for PACE loans, administered jointly by the Mayor’s Office of Sustainability and the New York City Energy Efficiency Corp., is expected to be released soon. Preliminary guidelines indicate that the loans can be used retroactively to pay for energy retrofits such as LED lighting or installation of solar panels, provided the retrofit was completed after the later of two dates: May 19, 2019, the effective date of the Climate Mobilization Act; or three years prior to the date on which the PACE financing agreement is signed.)

The OneNYC report shows the rate at which the city is cutting emissions slowed between 2017 and 2019. What’s behind that, and how do you reverse the trend?

In the short term, you’re going to see a lot of ups and downs based on weather and other dynamics. The important thing is we put in the chess pieces that are going to drive emissions down over the long term. This is really a race through the next eight months to make the big moves that shift the curve over time. Local Law 97 is going to transform the building blocks of the city of New York, reducing emissions from our buildings. There are the big moves we’re making on hydropower, large-scale renewable electricity and offshore wind – things that if we can move those forward, that’s going to move big chunks of emissions downward.

What’s the potential for geothermal energy, a method of tapping the energy stored in the Earth’s crust?

Geothermal is a really exciting technology – essentially taking the cool air just a few feet below the surface and bringing it to interior spaces. We have some initial analysis that identifies hundreds of blocks where we think something like this would be possible, and thousands of potential buildings. We are also looking for legislation that would set up a utility-like structure. The city could build and own these systems, and buildings in a certain area could accept this cool air and cover the city’s cost of investment. The scale of our ultimate ambition is to have something a lot of buildings can benefit from and is city-owned. We have big dreams in this area.