The significance of regulatory compliance for buildings

This article is sponsored by InSite.

As an energy analyst at InSite, I’ve had the unique opportunity to observe a wide spectrum of understanding among building owners and operators when it comes to building compliance. Some clients, particularly those managing hospitality and commercial offices, are well-versed in the mandates of their buildings’ jurisdictions, prioritizing the well-being of their occupants. However, a common trend is emerging where a significant lack of understanding exists around how to remain compliant, particularly among owners of large portfolios. 

In the realm of jurisdictional mandates for sustainable and energy-efficient operations, Building Performance Standards (BPS) and Benchmarking play pivotal roles in ensuring that buildings adhere to specified levels of performance. It’s not always common knowledge that certain steps need to be taken in order to be “in compliance” for building owners and operators. To better understand this, we must explore the essence of BPS and Benchmarking, shedding light on their importance, criteria and the metrics used for meeting compliance to avoid penalties and fines.

Understanding BPS

Building Performance Standards are regulatory measures and guidelines implemented to guarantee that buildings meet predetermined performance levels in various aspects. Governments and industry organizations establish these standards to foster sustainability, energy efficiency, safety, comfort, and overall quality in buildings. Compliance with BPS is crucial as it ensures that structures operate in ways that benefit both the environment and society.

In Washington, D.C., owners must demonstrate and report a 20 percent energy usage reduction every three years for specified buildings or face a fine of up to $100 per day in non-compliance penalties. This may be insignificant if handled swiftly, but the reality is, it can take two months or more for a business to aggregate, validate and submit the required information to the governing body. Similarly, in Boston, depending on the building type, owners must demonstrate and report emissions reductions over time every five years with a goal of net zero by 2050 — or face a penalty of up to $200 per day for noncompliance, which can easily amount to tens of thousands of dollars per building in a single portfolio. We outline more information on building performance mandates and fines, on the InSite Compliance Page. In addition to energy efficiency and emissions reductions, other BPS criteria include environmental sustainability, indoor air quality and occupant comfort.

These criteria sets are used to determine the minimum requirements that buildings must meet within a specified timeframe and jurisdiction to be considered compliant. Failure to comply may result in warnings, stiff financial penalties, or even revocation of building licenses. BPS programs are instrumental in promoting environmentally friendly and socially responsible practices within the real estate and construction industries.

Benchmarking in the built environment

Benchmarking involves evaluating a property’s performance in comparison to similar properties or the broader market. This evaluation process provides a score based on data submitted to state or local governments, focusing on energy usage, water consumption, waste management and carbon emissions. Benchmarking programs not only establish disclosure but also empower buildings to assess their performance over time. Data leveraged in benchmarking programs include energy usage, water usage, waste and carbon emissions or greenhouse gases (GHGs).

Data for these metrics can be extracted from various sources, including utility bills, meters, sensors and smart technologies associated with building resources. The U.S. Environmental Protection Agency maintains a scoring system, which has been widely adopted nationwide, called an ENERGY STAR score. By regularly inputting a building’s benchmarking criteria into ENERGY STAR Portfolio Manager, the building receives a score that is derived by establishing baselines for similar buildings. The baselines are formed by grouping like buildings in terms of size and use, across the country, to determine an average, then scoring each building on deviations from the mean overall performance within a respective building group. 

Getting compliant begins with data

One of the biggest challenges building owners of all types face in maintaining regulatory compliance is the collection and analysis of their buildings’ data. There are several ways a business can set out to collect their own performance data and submit it to reporting frameworks such GRESB and ENERGY STAR Portfolio Manager. Over the past four years, these self-managing methods have resulted in incomplete and unvalidated datasets. Data collection for anyone not familiar with collection methodology can also be an arduous task. 

Many businesses opt to leverage third parties to assist with data collection and reporting. As mentioned, many smart building technologies expertly assist in capturing and aggregating data for individual buildings and even entire portfolios. While these solutions offer streamlined data processing, they lack the ability to provide advisory insights into potential performance improvement opportunities and conservation measures that can wind-up costing business tens of thousands of dollars with very long payback periods. In my own experience, I have worked with many clients who have gathered data through third parties but have no idea what to make of it, nonetheless what to do with the resulting scores they receive. Equally as vital, most technologies are not able to incorporate compliance tracking and status’, putting the onus of meeting such laws back on the building owners.

As we navigate the landscape of building compliance, it is imperative for owners and operators to not only be aware of jurisdictional mandates but also to embrace comprehensive strategies for data collection, analysis and compliance tracking. By doing so, they can not only avoid penalties and fines but also contribute to a more sustainable and energy-efficient future for their buildings and the communities they serve.

About InSite

InSite employs its own advanced technology platform to efficiently gather and process building data that reports out a real time compliance status on each and every building. 

Through APIs and direct connections, the InSite platform validates client data before submission for certification programs, such as ENERGY STAR and sustainability reporting frameworks such as GRESB. Dedicated engineers and analysts at InSite continually monitor and track clients’ real time data to advise on performance improvement opportunities and energy conservations measures. This combination of technology and expertise enables a complete ROI within one year (or sooner) making InSite a popular choice among thousands of buildings nationwide. 

As an award-winning company with high customer satisfaction rates, InSite remains committed to exceeding client objectives. From ongoing commissioning services to implementing energy conservation measures and ESG reporting, InSite provides sustainable results that save businesses money while contributing to a greener world.