On Earth Day 2019, then-mayor Bill de Blasio signed the Climate Mobilization Act (Local Law 97) into law, heralding a Green New Deal for New York City. The measure, committing the city to full carbon neutrality by 2050, represented the most aggressive urban climate-change plan in America. Its centerpiece provision seeks to cut greenhouse-gas emissions from buildings, a source that constitutes two-thirds of the city’s total emissions. “In one of the great coastal cities of the world, there’s a lot we have to do to make sure that life in 2050 will be livable,” preached the mayor.
Local Law 97 won’t make life in New York more livable in 2050. On the contrary, starting next year, when its harsh penalties take effect, the law will further raise costs in the world’s priciest housing market, force middle-income New Yorkers to subsidize green industries, and—by discouraging newcomers and driving away existing residents—displace emissions to less carbon-efficient jurisdictions. In exchange for nearly three decades of New York sacrifices, LL97 will reduce global climate emissions by an infinitesimal amount. City officials should instead consider more effective and less burdensome alternatives.
A decade of environmental lobbying and incremental legislation paved the way for Local Law 97. Local Law 84, passed in 2009, required buildings to monitor and submit yearly energy and water consumption through the U.S. Environmental Protection Agency’s Energy Star Portfolio Manager. In 2014, de Blasio committed New York to cutting its greenhouse-gas emissions by 80 percent from 2005 levels by 2050. The city then enacted Local Law 33 in 2018, mandating that buildings over 25,000 square feet in floor area post a label near each public entrance containing Energy Star scores and a letter grade for energy efficiency. And a few days before leaving office, de Blasio signed Local Law 154, requiring that most new construction beginning in 2024 contain all-electrical cooking and heating equipment. Influencing these measures was the nonprofit Urban Green Council, whose supporters include electric heating-system manufacturers, environmental consultants, real-estate firms, and 32BJ, the politically powerful mega-union that represents some 35,000 building workers.
Local Law 97 also covers buildings that exceed 25,000 square feet, as well as clusters of buildings on the same tax lot that together exceed 50,000 square feet. All told, LL97 will loom over more than 50,000 buildings, which together account for more than 60 percent of the city’s building area and 50 percent of its building emissions. The law will, therefore, regulate about one-third of Gotham emissions.
To do so, the law assesses emissions in terms of metric tons of carbon-dioxide equivalent (CO2e), the measurement used to compare various greenhouse gases based on their global warming potential, as defined in a report issued by the United Nations’ scientific panel on climate change. In this emissions-accounting system, the energy used to power and heat each building gets broken down by source and converted to the amount of carbon-dioxide equivalent that results. For example, natural gas and fuel oil combusted on-site have their own respective carbon-emissions coefficients per British thermal unit. Electricity delivered via the power grid has its own city-defined coefficient, denominated per kilowatt-hour. The measure then regulates the ratio of building emissions to square footage—what LL97 calls “emissions intensity.” The specific emissions limit that each affected owner will face is determined by his building’s designation under the Energy Star Portfolio Manager’s property types index. By May 1, 2025, and annually thereafter, each building owner must file a report with the city Department of Buildings detailing whether the structure exceeded the cap during the previous year.
Local Law 97 sets carbon caps for covered buildings in five-year compliance periods, each stricter than the last, until 2050. The city estimates that roughly 30 percent of affected buildings will comply with the 2024–29 period without further action to mitigate emissions. But come 2030, when far lower limits take effect, around 72 percent will be noncompliant without retrofitting, including 87 percent of commercial and 67 percent of residential buildings.
Targets alone, of course, compel little action. The stick that the city will wield to force change is a $268 penalty for each ton of emissions over the building’s Energy Star–determined limit. Certain exemptions apply, including for buildings with 35 percent or more rent-regulated units whose owners can show that they have implemented a series of energy-conservation measures. And though the city government’s operations are required by 2030 to lower carbon emissions by 50 percent relative to 2006 levels, city-owned buildings, including those in the New York City Housing Authority’s portfolio, are exempted from these direct fines as well. Whether the Department of Buildings will enforce LL97 effectively remains uncertain, given long-standing departmental challenges, a brand-new commissioner, and a nearly 23 percent employee vacancy rate.
In July 2019, state lawmakers followed up by passing the Climate Leadership and Community Protection Act (CLCPA), which sets statewide carbon-reduction targets of 40 percent below 1990 levels by the end of this decade, an 85 percent reduction by 2050, and an ultimate goal of net-zero greenhouse-gas emissions. The act also requires 70 percent of the state’s power grid to come from renewable sources in 2030 and 100 percent by 2040. To help achieve that, the CLCPA obliges the state to create six gigawatts of solar capacity by 2025—slightly less than double July 2022’s solar capacity—and nine gigawatts of wind capacity by 2035, or four times today’s capacity. For context, though zero-emission sources power most of upstate New York (largely thanks to hydropower from Niagara Falls), fossil fuels currently generate about 89 percent of downstate energy. That’s 12 percent higher since 2021, thanks to the closure of Westchester County’s Indian Point nuclear power plant and its replacement by three natural-gas-fired stations.
Owners affected by LL97 may deduct carbon from their building’s emissions by purchasing renewable-energy credits from renewable sources operating in the city, or from renewable projects that transmit electricity directly into the city’s energy grid. The law’s text doesn’t limit the number of credits that owners may purchase, but it authorizes the Department of Buildings to make rules regarding their use. Controversy erupted last fall as the department proposed allowing unlimited credit purchases, with environmental activists alarmed that a large supply of credits, many resulting from CLCPA projects, would set their price too low to encourage building retrofits. The department has not yet released final rules about credit-purchase limits, though the credits will apparently offset only carbon emissions generated from electricity use, not those from oil- and gas-burning equipment.
Commercial and residential buildings alike now find themselves confronted with daunting new liabilities. For its One Bryant Park building that houses Bank of America’s corporate and investment offices, the Durst Organization expects an annual penalty of $2.4 million beginning in the 2024 compliance period. And when the 2030 limits kick in, old-fashioned efficiency hacks like shoring up weather-stripping and swapping out old incandescent lightbulbs will be long exhausted. Local Law 97 will demand costlier and more disruptive changes. A study sponsored by the Real Estate Board of New York estimates that, starting next year, 3,700 properties will be subject to penalties of more than $200 million annually, and 13,500 will be noncompliant by 2030 and contend with roughly $900 million in fines.
The law has already begun an unprecedented wave of pricy retrofits and teardowns. The Urban Green Council estimates that if all buildings meet their 2030 carbon caps, the annual retrofit market will grow to about $3 billion, with up to 126,000 “green” jobs created by 2030. Green advocates assert that retrofits will save buildings money, but that math requires speculative assumptions about future energy prices and holds only in the very long run. By contrast, consultants, manufacturers, and installers of electric-based heating equipment, solar panels, and geothermal energy have already begun benefiting handsomely. Anticipating the daunting 2030 cap, co-op shareholders at one Financial District building have already spent about $35,000 per apartment to revamp heating and cooling systems. Buildings that replaced old boilers with new, more efficient ones in recent years will have to pay again—this time, for electricity-based heating equipment.
Many New Yorkers can’t afford such measures, especially middle-income workers, small-business owners, fixed-income seniors, and those struggling to raise a family. New York City’s convoluted property-tax system has for decades disproportionately burdened the owners (and tenants) of large rental buildings, who are now saddled with LL97. As forced retrofits and harsh penalties make apartments in affected buildings even less desirable, small single- and multifamily homes not covered by the law will become relatively more valuable. That will accrue to the benefit of homeowners, who already enjoy among the lowest effective property taxes in the metro area. And carbon-emitting small businesses like restaurants and self-service laundries in covered buildings will likewise wish to relocate to nonregulated spaces, distorting commercial lease rates and access to amenities for nearby residents.
Some are fighting back. In February, a Republican-led group of city councilmembers introduced a bill that would delay LL97 implementation by seven years. And last May, the Glen Oaks Village Owners Association and the Bay Terrace Cooperative, two middle-income co-op communities in eastern Queens, were among those suing the city to enjoin the law’s enforcement under several theories, including preemption by the state CLCPA and unconstitutionally excessive and retroactive deprivations of property, in violation of state and federal due-process guarantees. The suit remains pending.
In its complaint, the Glen Oaks co-op revealed that, based on a $64,000 compliance study, replacing all the boilers that heat its 2,904 units with high-efficiency units would cost approximately $24 million, with total expenses climbing above $9,000 per household. Spread over ten years, this would represent a monthly maintenance increase of 26 percent. Even with the upgraded boilers, the association would still generate annual penalties in the 2030 compliance period of $818,200, an extra 4 percent in monthly maintenance costs per unit. Arlene Bett, 60, who has lived in her one-bedroom Glen Oaks co-op long enough to pay it off, told the New York Times that she’s “terrified” of this prospect, noting that she “will not be able to afford it, and there’s no place cheaper.”
In short, even if buildings install every energy-efficiency upgrade within reason, LL97 will still impose penalties. Warren Schreiber, president of the Bay Terrace co-op, who also joined the lawsuit as an individual co-plaintiff, said to the New York Post, “I’ve been the board president for 25 years and never had an issue that actually kept me awake at night.” Until now.
What will New Yorkers like Bett and Schreiber get in return for LL97? Assuming that the city’s covered buildings comply, New York’s 2030 emissions goal would save about 5.3 million tons of CO2 per year, or 38 percent for covered buildings, relative to the base year of 2005, according to the Sustainability Advisory Council. That amounts to 0.12 percent of the 4.5 billion tons of carbon emitted from Chinese coal-fired power plants in 2018. If the city hits its 80 percent total reduction target by 2050, it will have eliminated about 47.4 million tons of CO2 annually. A standard 500-megawatt coal-fired power plant produces about 4 million tons of CO2 per year. New York’s 2050 goal, therefore, would remove less carbon dioxide than is produced by 12 standard coal-fired plants. Last year alone, China permitted the equivalent of two such plants a week, enough to overwhelm New York’s quarter-century of emissions cuts in six weeks.
Environmental-justice defenders of LL97 are quick to point to statistics showing that black and Hispanic communities contend with higher concentrations of air pollutants, including fine-particulate pollution and nitrogen oxides, such as nitric oxide and nitrogen dioxide. These contribute to respiratory issues like asthma, resulting in higher death rates than majority-white communities. But carbon dioxide is not a hazardous air pollutant; it does not directly cause respiratory issues. Local laws and regulations aimed at improving public health should instead focus on curbing hazardous emissions, with any reductions in greenhouse gases being a secondary benefit.
Even granting its carbon-reduction aims as valid, the law’s mechanisms fail scrutiny. Because greenhouse-gas concentrations mix evenly in the atmosphere and matter only in the aggregate, whether each and every building limits its own emissions is irrelevant to the citywide goal of reducing totals. Supporters of LL97 see the portion of city emissions owing to buildings as a blemish on the Big Apple; in reality, it illustrates an extraordinary environmental success. Buildings emit two-thirds of the city’s greenhouse gases because urban density eliminates hundreds of tons of emissions from a person’s lifetime carbon footprint, thanks to the reduced use and intensity of carbon-based transportation.
In a 2006 paper, a group of University of Toronto researchers found that in low-density development, 61 percent of greenhouse-gas emissions came from transportation and 32 percent from buildings. The flipside of New York’s seemingly high building emissions is extraordinarily low transportation emissions, which make up only 28 percent of the total. University of Illinois researchers found in 2014 that a doubling of population-weighted density cuts average household transportation emissions in half. Contrast New York City’s population density of 29,298 per square mile with Miami’s 12,284—much less Austin, Charlotte, Atlanta, Nashville, all under 4,000—and the environmental desirability of attracting households to Gotham comes into focus.
The multiunit buildings and townhouses that typify New York’s urban form also enjoy a distinct energy-efficiency advantage over detached houses. According to the U.S. Energy Information Administration, the average household living in a detached house consumed about three times more energy than a household living in a building with five or more units. Only part of that difference can be explained by home size. Units in larger buildings are more efficient than detached houses when square footage is held constant, thanks to their shared walls. While heating and cooling account for more than half of detached homes’ energy consumption, for units in buildings with five or more apartments, heating and cooling account for less than a third of energy use.
The result of New York City’s built environment, walkability, and transit access is that New York State has the lowest carbon emissions per capita in the nation. The average Gothamite emits about 70 percent less greenhouse gas each year than the national norm. Taking New York and New Jersey together, the picture still looks favorable in emissions terms, even compared with the vaunted transit-and-bicycle paradise of the comparably populated Benelux countries of Belgium, the Netherlands, and Luxembourg.
Local Law 97’s myopic penalties risk casting households and businesses toward higher-emitting lifestyles in the sprawl-style states of the Sunbelt. And the post-Covid city is even less able to afford compliance, as it contends with a sustained increase in commercial real-estate vacancy rates and with Manhattan rents, which hit an all-time high this spring. Compliance costs will deter the building of new housing, too, hindering the mayor’s goal of creating 500,000 new units by the end of the decade. Further, because LL97 measures a building’s total energy consumption without accounting for the number of occupants, it discourages density within buildings. Fewer people in a building will use less electricity building-wide, yes. But staying under the carbon cap by reconfiguring family-oriented apartments to house singles instead will hardly make the city more climate-friendly.
By spurring premature retrofits, moreover, LL97 risks catalyzing its own emissions increase with the production, transportation, and installation of the new energy-efficient equipment that the law demands. It may indeed be costlier in emissions terms to install a new system now rather than wait for one that could in ten or 20 years be produced, transported, installed, and operated at a lower emissions cost because of technological and efficiency advances. This act-now impulse could also lead to the installation of equipment that swiftly finds itself obsolete as industry progresses. For the firms peddling such wares, that is, of course, part of the act-now calculus.
Among the most discussed pathways to compliance is replacing traditional boilers with electric heat pumps, such as ductless mini-split units. When the carbon tax bites, there will be calls for the city and state to cover billions in replacement costs. Older apartment buildings without ductwork require multiple heat pumps (often one per apartment), which have an expected life span of ten to 20 years. By contrast, a single conventional boiler can heat an entire building and often lasts 30 to 40 years—without the risk of refrigerant leaks. The wisdom of such spending aside, subsidy programs aren’t always well designed or administered. One six-year state incentive for heat pumps proved so rich that Con Edison, the city’s utility provider, received applications totaling nearly triple its $227 million budget more than three years early.
Alternatively, the city could set up a trading program, with highly efficient buildings allowed to sell their leftover emissions allotment, rather than simply avoiding a penalty by coming in under their cap. Such a system would motivate further cuts for buildings with the capacity to take them on, while giving more compliance flexibility to others, especially older buildings that would incur fines even after extensive retrofitting. And this system would incentivize the capturing and storing of emissions on-site, a novel technique that some buildings are starting to implement.
Air-quality improvements from forced electrification could be made more directly and without discouraging urban living through higher costs. Consider the city’s 2011 regulation phasing out buildings’ use of No. 4 and No. 6 grades of high-sulfur fuel oil, which produce dangerous pollutants. It has contributed to declines in 2009-level fine-particles emissions by 40 percent, nitric oxide by 58 percent, and sulfur dioxide by an astounding 97 percent. Gradual conversions from oil to natural-gas boilers have helped, too, as natural-gas combustion emits far fewer hazardous pollutants (and greenhouse gases), compared with oil-based combustion. Achieving further reductions is possible by, for example, enforcing regulations on commercial charbroil cookers.
The city’s myopic attention to buildings’ carbon emissions should be refocused on a genuinely needed program: a Manhattan congestion-pricing scheme. Putting a price on scarce Manhattan road space would simultaneously improve emissions, local air pollution, and traffic. Evidence of congestion pricing’s effectiveness abounds internationally, but the paragon remains Singapore, which implemented it in 1975. Singapore’s system not only saves time on roads for automobiles in a traffic-snarled region; it also saves 30,000 tons in emissions yearly. In June, the Federal Highway Administration granted final approval to the city’s framework, placing the onus on the Metropolitan Transportation Authority to establish specific toll rates, discounts, exemptions, and other allowances.
Barring a full repeal of LL97, city lawmakers should delay its implementation while a study examines how to factor building density into emissions limits. Meantime, they might also facilitate alternatives that won’t aggravate New York’s affordability crisis, such as a pilot carbon-trading scheme and carbon-capture possibilities.
Representatives are supposed to act in their constituents’ best interests, but LL97 shows how that principle can get turned on its head in New York. Passed by city councilmembers who would be long out of office by the time the harsh penalties kick in, and signed into law by a mayor seeking to make a national name for himself before a presidential primary, LL97 subordinates the good of New Yorkers to short-term political self-interest and the perceived needs of the wider world. Its advocates justify this inversion by framing the city’s emissions cuts as a matter of averting ecological calamity. “The greatest threat to the people of New York City is climate change,” says councilmember Lincoln Restler, cochair of the council’s Progressive Caucus, who represents a wealthy stretch of Brooklyn waterfront, adding, “We have no choice but to drive down emissions and stave off climate catastrophe.”
But LL97 will not stave off a climate catastrophe. New Yorkers and their city face threats far more imminent than climate change: eye-watering levels of unaffordability, deteriorating public safety and order, an unprecedented influx of shelter-seeking migrants, a lack of capacity to address severe mental illness, near-future budget shortfalls, a failing public school system, and major macroeconomic uncertainty, among others. Unlike with climate change, however, city and state officials can meaningfully address these problems.
Most fundamentally, LL97 represents an errant form of environmentalist absolutism. It forces hard choices on residents to satisfy the performative impulses of progressive activists, jeopardizing the viability of carbon-friendly urban living for all but the wealthy. It’s a bad deal for New York—and, ultimately, for the environment, too.
Top Photo: Already facing a commercial real-estate crisis, property owners will be forced to retrofit their buildings or endure stiff penalties. (C. TAYLOR CROTHERS/GETTY IMAGES)
