MEP CA AB 1103

CA AB 802

AB 1103, California's mandatory utility benchmarking disclosure law in the event of the sale, lease or refinance of commercial buildings, is no longer in effect as of the beginning of 2016. CA AB 1103 will be replaced by CA AB 802 on January 1, 2017. Until January 2017 there is no statewide energy benchmarking legislation in effect.

AB 802 is a statewide mandatory annual energy benchmarking and utility gathering plan for California commercial (and some multi-family) buildings, beginning at 50,000 SF and above, with requirements for smaller buildings rolling out on an annual basis as the program evolves. Note that this is different from AB 1103 as it does not require the sale, lease or refinance of commercial buildings as a trigger, but requires all buildings of a certain size to complete an annual benchmark that is reported to the state of CA. Similar to the City of San Francisco, California will also be potentially requiring energy audits every 5 years, although they may waive this requirement for ‘high performing’ buildings that have an annual history of ENERGY STAR awards.

The EPA’s ENERGY STAR Portfolio Manager system is the mechanism through which building owners are expected to report their utility usage. After entering building information and obtaining tenant bills, the utility data and space use details will be analyzed and assessed within the guidelines of the Portfolio Manager System, most often with the assistance of a licensed Professional Engineer “PE”.

AB 802 legislation has been passed in the hope that California will measure energy efficiency via appraisals of normalized metered energy consumption so that the state and utility providers can better understand how energy efficiency affects the grid. The bill also serves the dual purpose of making the utility collection phase of benchmarking easier on building owners, tenants, and Service and Product Providers.

Under AB 802, owners of commercial buildings with three or more active utility accounts and owners of multifamily properties with five or more accounts will be able to access whole-building utility information directly from the utility companies. This utility access provision will remove some of the barriers that have been occurring in utility gathering for building owners with multiple tenants.

Per current state law the State Resource Conservation and Development Commission (the Energy Commission) is mandated to perform assessments and forecasts of the energy industry's supply, demand, production, transportation, delivery, distribution, and prices every two years. This information is compiled into a bi-annual report that informs state policy makers and guides legislation in assessing and remediating system reliability, energy efficiency and conservation, as well as determining any additional resources that may be required.

AB 802 requires the Energy Commission to consult with the Public Utilities Commission (PUC). The bill also authorizes the Energy Commission to use the PUC's program data to inform modifications to energy demand forecasts, which helps to adjust for market conditions and existing baselines. This cooperation is enabled in the hopes that it will better inform public policy.

AB 802 mandates that the PUC investigate utilities’ ability to provide financing options to their customers in terms of implementing the energy efficiency programs that the Energy Commission develops. AB 802 also authorizes the Energy Commission to specify and request supplementary information from electric and gas utilities. In addition it grants the Energy Commission the ability to issue civil fines for violation of these data submission requests.

Energy Efficiency programs will be impacted by AB 802. As it stands the Energy Commission holds the duty of developing and implementing comprehensive programs aimed at increasing energy savings in non-residential buildings. The PUC investigates utilities' ability to provide financing options to customers involved in implementing these energy efficiency programs. With the passage of AB 802, however, the PUC is mandated to authorize electric and gas corporations to provide incentives, rebates, technical assistance, and support to their customers to increase energy efficiency in pre-existing buildings. Utilities will be allowed to recover reasonable costs of the programs through rate recovery mechanisms. The PUC will authorize utilities to count all energy savings via programs directed toward the overall organization's goals of energy efficiency.

Most of our commercial and industrial customers use the ENERGY STAR program on a voluntary basis to benchmark and award certify their buildings. They appreciate the ability to assess their gas and electric utility usage as compared to their peers on a nation-wide basis, and also like the recognition they receive that comes with the ENERGY STAR label on their buildings. We recommend that all of our California customers get ahead of the new AB 802 legislation, take the initiative, and start benchmarking today!