New York City Local Law 97: A Guide to Compliance and Energy Efficiency

Understanding Local Law 97 & Its Impact On Buildings

New York City is leading the charge on climate action with Local Law 97 (LL97), a key regulation under the Climate Mobilization Act that requires large buildings to cut greenhouse gas emissions. The law aims to reduce citywide emissions by 40% by 2030 and 80% by 2050, with strict performance targets that building owners must meet to avoid penalties.

As a business or property owner in New York City, understanding LL97’s regulations, compliance deadlines, and energy efficiency requirements is crucial. This guide will explain what LL97 entails, how it affects your building, and what steps you should take to stay compliant while optimizing energy performance.

What Is Local Law 97?

LL97 applies to commercial and multifamily buildings over 25,000 square feet, as well as groups of buildings on the same tax lot or condo board that exceed 50,000 square feet collectively. The law mandates annual greenhouse gas emission limits, which become progressively stricter over time.

Compliance Deadlines & Performance Targets

Buildings must meet specific carbon intensity limits, measured in metric tons of CO₂ equivalent per square foot, during the following compliance periods:

• 2024-2029: Initial emission limits take effect. An estimated 11% of buildings will exceed these limits and must take corrective action.
• 2030-2034: Stricter limits are introduced, impacting approximately 63% of covered buildings.
• 2035-2050: Emission caps continue to tighten as New York City progresses toward full decarbonization.

Penalties For Non-Compliance

Building owners who fail to meet LL97’s emission thresholds face fines of $268 per metric ton of CO₂ equivalent over the limit. For example, a building exceeding its carbon cap by 10 metric tons would face an annual penalty of $2,680.

Avoiding these fines requires strategic planning, energy efficiency upgrades, and proactive emissions reduction strategies.

Who Must Comply With LL97?

LL97 applies to:

• Commercial buildings over 25,000 square feet.
• Multifamily residential properties exceeding 25,000 square feet.
• Groups of buildings under the same ownership exceeding 50,000 square feet.

Certain properties, such as houses of worship and some rent-regulated buildings, may qualify for alternative compliance pathways.

Steps To Achieve Compliance With Local Law 97

1. Benchmark & Monitor Energy Use

Tracking energy consumption is the first step toward meeting LL97’s emissions caps. Building owners should:

• Use ENERGY STAR Portfolio Manager to track and benchmark energy use.
• Conduct an energy audit to identify inefficiencies and improvement opportunities.
• Establish a compliance roadmap to ensure emission reduction goals are met by 2030 and beyond.

2. Implement Energy Efficiency Upgrades

Energy efficiency measures help buildings reduce carbon emissions while cutting costs. Recommended upgrades include:

• LED lighting retrofits to lower electricity consumption.
• High-efficiency HVAC systems that optimize heating and cooling performance.
• Upgraded insulation and windows to improve thermal efficiency and reduce energy loss.
• Smart building automation systems to control energy use more effectively.

3. Transition To Electrification

Buildings relying on natural gas or oil-based heating must start transitioning to electric-powered systems to stay compliant with future regulations. Key electrification steps include:

• Replacing gas boilers with electric heat pumps.
• Upgrading water heating systems to electric models.
• Installing EV charging stations to support transportation electrification.

Electrification reduces reliance on fossil fuels, helping buildings future-proof their operations.

4. Invest In Renewable Energy Solutions

On-site and off-site renewable energy can help buildings meet LL97’s carbon limits. Strategies include:

• Installing solar photovoltaic (PV) panels on rooftops.
• Purchasing renewable energy credits (RECs) to offset emissions.
• Participating in community solar programs for off-site clean energy generation.

Buildings that adopt renewable energy can significantly lower their carbon footprint while securing long-term energy cost savings.

5. Optimize Water Efficiency & Sustainability Measures

LL97 is primarily focused on energy and emissions, but water conservation plays a role in sustainable building operations. Recommended steps include:

• Installing low-flow plumbing fixtures to reduce water usage.
• Implementing rainwater harvesting systems for irrigation and cooling.
• Upgrading cooling towers to minimize water waste.

Efficient water use complements energy-saving initiatives, leading to lower utility costs and environmental benefits.

6. Take Advantage of Financial Incentives

New York City and state agencies offer incentives to help building owners comply with LL97. Available programs include:

• NYC Accelerator: Free advisory services to help buildings reduce emissions.
• NYSERDA Clean Energy Programs: Grants and rebates for energy efficiency improvements.
• Federal tax credits for renewable energy installations under the Inflation Reduction Act.

Accessing these programs can reduce the cost of LL97 compliance while improving building performance.

Why Businesses Should Prioritize LL97 Compliance

1. Avoid Fines & Penalties

Buildings that fail to meet LL97’s carbon reduction targets will face significant financial penalties. Compliance helps eliminate unnecessary costs and legal risks.

2. Reduce Operating Expenses

Energy efficiency and electrification projects lower energy bills, providing long-term financial benefits. Upgrades to HVAC, lighting, and insulation can lead to substantial cost savings.

3. Improve ESG Performance & Market Competitiveness

• Tenants, investors, and stakeholders increasingly prioritize sustainability.
• Green building certifications enhance property value and leasing potential.
• Businesses with strong ESG (Environmental, Social, and Governance) practices gain a competitive edge.

4. Future-Proof Buildings Against Energy Regulations

LL97 is just one step in New York City’s broader push for building decarbonization. Early compliance ensures buildings are prepared for stricter emissions limits in the future.

Preparing For Local Law 97 Compliance

New York City’s Local Law 97 is one of the most ambitious building performance standards in the U.S. Businesses and property owners should act now to:

• Benchmark energy performance and track emissions reductions.
• Upgrade building systems for efficiency and electrification.
• Invest in renewable energy and sustainability initiatives.
• Take advantage of financial incentives to offset upgrade costs.

LL97 compliance is a critical opportunity to enhance building efficiency, reduce costs, and contribute to New York City’s decarbonization goals.