Chicago Energy Benchmarking Ordinance: Compliance Guide for Building Owners
A comprehensive guide to understanding Chicago’s energy benchmarking requirements for commercial and multifamily buildings.
Understanding Chicago’s Building Performance Standards
Chicago is a leader in urban sustainability, and its Energy Benchmarking Ordinance is a key component of its climate strategy. The ordinance requires large commercial, institutional, and residential buildings to track and report energy consumption to improve efficiency, reduce emissions, and increase transparency.
For businesses and building owners, compliance with the ordinance is mandatory. More than just a regulatory requirement, benchmarking provides valuable insights into energy performance, helping owners identify inefficiencies and cost-saving opportunities.
Who Must Comply with Chicago’s Energy Benchmarking Ordinance?
The ordinance applies to:
- Commercial, institutional, and residential buildings over 50,000 square feet.
- Municipal buildings over 10,000 square feet.
- Owners of multiple properties must submit data for each covered building.
Buildings that meet these criteria must comply with annual energy reporting requirements and periodic data verification.
Key Compliance Requirements
1. Annual Energy Benchmarking and Reporting
Building owners must report energy consumption annually using the ENERGY STAR Portfolio Manager, a tool that allows businesses to compare energy use against national benchmarks.
Benchmarking involves:
- Collecting utility data for electricity, gas, steam, and other energy sources.
- Entering data into the ENERGY STAR Portfolio Manager.
- Submitting a benchmarking report to the City of Chicago by June 1 each year.
2. Third-Party Data Verification
To ensure data accuracy, buildings must undergo third-party verification by a licensed professional every three years. This process confirms that the reported data aligns with actual energy use and helps identify discrepancies or errors in reporting.
3. Public Disclosure of Energy Performance
Chicago publicly shares energy performance scores for buildings covered by the ordinance. This disclosure encourages property owners to improve efficiency and gives tenants, investors, and policymakers insight into building sustainability.
Compliance Deadlines
- Annual Benchmarking Reports: Due June 1 each year.
- Third-Party Verification: Required every three years for continued compliance.
Failure to meet these deadlines can result in fines and enforcement actions by the city.
How to Achieve Compliance
1. Gather Energy Data
Start by collecting 12 months of energy use data from your utility providers. If tenants have separate utility accounts, coordinate to obtain their consumption data.
2. Input Data into ENERGY STAR Portfolio Manager
Use the Portfolio Manager tool to enter energy data. The system calculates a performance score and provides insights into energy efficiency.
3. Complete Third-Party Verification (When Required)
If your building is due for verification, hire a licensed professional (such as a professional engineer or certified energy manager) to review and approve your benchmarking report.
4. Submit the Report to the City of Chicago
Ensure that your benchmarking report is submitted before the June 1 deadline to avoid penalties.
How Benchmarking Improves Energy Performance
Compliance with the ordinance does more than fulfill legal obligations—it provides actionable insights that can help businesses reduce costs and improve sustainability.
1. Identifying Inefficiencies
Benchmarking allows building owners to compare their energy use with similar properties, revealing underperforming systems and opportunities for efficiency upgrades.
2. Reducing Operational Costs
Improving energy efficiency leads to lower utility bills. Simple upgrades like HVAC system optimization, lighting retrofits, and automated building controls can deliver significant cost savings.
3. Increasing Property Value
Energy-efficient buildings are more attractive to tenants, buyers, and investors. Public energy disclosure incentivizes property owners to improve performance, boosting market competitiveness.
Strategies for Energy Efficiency and Compliance
1. Upgrade Building Systems
Invest in high-efficiency HVAC, LED lighting, and smart building controls to lower energy consumption. Retrofitting aging equipment can yield immediate performance gains.
2. Implement Demand Response Programs
Participate in utility demand response programs that reduce peak electricity demand and lower costs. Smart energy management can help optimize building operations.
3. Electrify Heating and Cooling Systems
Transitioning from natural gas to electric heating and cooling improves sustainability and aligns with Chicago’s broader emissions reduction goals.
4. Adopt Renewable Energy Solutions
Consider on-site solar panels or purchasing renewable energy credits (RECs) to offset energy consumption.
Penalties for Non-Compliance
Buildings that fail to submit benchmarking reports face fines of up to $100 per violation, with additional daily penalties of $25 per day until compliance is achieved.
Financial Incentives and Support for Compliance
Chicago offers financial assistance to help building owners improve energy efficiency and meet benchmarking requirements:
1. Utility Rebates:
ComEd and Peoples Gas offer rebates for lighting, HVAC upgrades, and energy efficiency projects.
2. PACE Financing:
Provides low-interest financing for energy efficiency improvements and renewable energy installations.
3. Free Benchmarking Assistance:
The city offers training workshops and one-on-one support for property owners navigating the compliance process.
Why Compliance Matters for Your Business
Meeting benchmarking requirements is more than just a legal obligation it’s a smart business decision. Key benefits include:
1. Lower Utility Costs:
Reducing energy waste translates to significant cost savings.
2. Improved Building Performance:
Data-driven insights help optimize operations and extend equipment lifespan.
3. Enhanced Marketability:
High-performing buildings attract better tenants and higher resale values.
4. Avoiding Fines:
Timely compliance prevents costly penalties and enforcement actions.
What Should You Do Next?
If your building is subject to Chicago’s Energy Benchmarking Ordinance, take proactive steps to ensure compliance:
- Confirm whether your building meets the ordinance criteria.
- Start collecting energy data and input it into ENERGY STAR Portfolio Manager.
- Schedule third-party verification if required.
- Submit your benchmarking report before June 1.
- Implement energy efficiency measures to improve building performance.
By staying ahead of compliance requirements, your business can reduce costs, improve efficiency, and contribute to Chicago’s climate goals.
