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Energy consumption benchmark requirements for some nonresidential building delayed until July 2016

September 16, 2014 by Daniel S. Gonzales Leave a Comment

Energy usage of nonresidential buildingsEnergy usage of nonresidential buildings can be an unknown and hidden cost of ownership when contemplating a commercial real estate deal. The California Nonresidential Energy Use Disclosure Program (AB 1103) was supposed to introduce transparency into these transactions, mandating the benchmarking of energy use as well as the disclosure of such information at least 24 hours before a sale, lease or refinancing of a California nonresidential building is finalized.

Now, however, the California Energy Commission has issued an emergency rule delaying the enforcement of this requirement on buildings between 5,000 and 10,000 sq. ft. until July 2016.

The staged enforcement of this new disclosure requirement tracks to building size:

  • Stage One: Starting July 1, 2013, for a building with total gross floor area measuring more than 50,000 sq. ft.
  • Stage Two: Starting January 1, 2014, for a building with a total gross floor area measuring more than 10,000 square feet and up to 50,000 square feet.
  • Stage Three: Starting July 1, 2016, for a building with total gross floor area measuring at least 5,000 square feet and up to 10,000 square feet.

This new requirement, when fully implemented, will require coordination with the Energy Star website, implementation of a 30-day benchmarking process, and the preparation of a report to the interested parties in the real estate transaction. Since this process requires a full 30 days of data collection, property managers would be prudent to become familiar with this process, and complete this benchmarking process early in the sales, leasing or refinancing process.

Filed Under: energy Usage

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Mr. Gonzales is in private practice, providing representation, advice and counsel in complex real estate, corporate, and business transactions on behalf of public and private institutions, businesses, and individuals.

This material has been prepared by Daniel S. Gonzales for informational purposes only and does not constitute advertising, a solicitation, or legal advice. Neither delivery nor transmission of this material or the information contained herein is intended to create, and receipt thereof does not constitute formation of, an attorney-client relationship. The reader should not rely upon this information for any purpose without seeking legal advice from a licensed attorney. The information contained in this material is provided only as general information and is not promised or guaranteed to be correct or complete. Daniel S. Gonzales expressly disclaims all liability in respect to actions taken or not taken based on any or all the contents of this material.

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