CSG Law Alert: Energy and Water Consumption Benchmarking for NJ Commercial Buildings Scheduled to Start October 2023

Building owners may start receiving notices regarding the benchmarking of energy and water consumption in July. These notices are a result of New Jersey’s Clean Energy Act of 2018 which required the NJ Board of Public Utilities (“BPU”) to set up a program whereby owners and operators of commercial buildings containing more than 25,000 square feet are required to benchmark energy and water consumption for the prior calendar year using the United States Environmental Protection Agency’s Portfolio Manager tool. Moreover, it should be noted that the square footage of an attached parking garage under this law will be included in the 25,000 square foot threshold determination.

By order dated September 14, 2022 (“Order”), the BPU approved the benchmarking process.  In addition to requiring most commercial buildings containing more than 25,000 square feet to benchmark, the Order also requires residential multi-family buildings designed for five families or more to benchmark.  It is important to note industrial properties (classified as 4B) are not required to benchmark. To protect tenant anonymity, the BPU ordered landlords to obtain tenant consent to benchmark in buildings with fewer than four tenants or with one tenant who uses more than 50% of building energy and water.

The Order specifies benchmarking for 2022 would be due in October 2023 and the duty to benchmark would be triggered by receipt of a notice to the building owner from the BPU.  The Order sets forth a process by which any building owner that receives notice that it must benchmark may appeal the determination that it is a covered building as defined in the Order.

During its March 7, 2023 meeting, the BPU announced it expected to start sending benchmarking notices to building owners pursuant to the Order in July 2023.  According to the BPU Benchmarking Program Manager, notices could arrive as early as June.

In the event you receive a notice pursuant to the Order or otherwise have questions regarding the Order or the benchmarking requirements please contact your CSG Law attorney.