Facing Criticism, Legal Challenges, Energize Denver Requirements Could Be Relaxed
Proposed rule changes to the Energize Denver ordinance could give owners of multifamily and office buildings a major break in 2025.
The 2021 ordinance aims to slash 80% of greenhouse gas emissions from multifamily and commercial buildings 25K SF or larger by 2040 and has met stiff resistance from swaths of the local commercial real estate community.
The consideration of new rules comes amid severe distress in Denver’s CRE market, especially downtown, where 34% of the office space is vacant, according to third-quarter CBRE data.
New rebates, extended deadlines, slashed emissions reduction targets and expanded support services are just some of the major changes being considered, the Denver Business Journal reports.
“One of the most important messages that we want to share with the business community is that we really want to hear their feedback and listen to their concerns,” Liz Babcock, executive director of Denver’s Office of Climate Action, Sustainability and Resiliency, told the DBJ. “We know that there have been barriers and challenges, and so we want to be responsive.”
Owners or managers of large buildings are required to file annual reports measuring energy usage, meet certain performance targets, switch to electric when replacing aging heating equipment, and adhere to sustainability rules when replacing a roof.
More than 80% of buildings have incorrect targets, Energize Denver told the DBJ, potentially the result of reporting inaccurate square footage or energy data from the utility provider.
More than a quarter of these large buildings are already meeting 2030 goals, according to CASR. That is a slight increase from the 24% of buildings reported to be already meeting those goals in the agency's 2023 annual report released this past summer. The same report said 95% of large buildings were tracking and reporting energy use as required by Energize Denver.
Four CRE-focused trade organizations filed a federal lawsuit against the city and state in April, claiming rules surrounding required electrification are unconstitutional and violate preemptive federal laws. In June, Denver moved to dismiss the case, The Denver Gazette reported, and a ruling on that motion is pending.
The lawsuit didn’t play a role in these proposed changes, the city told the DBJ.
Upcoming feedback sessions surrounding these changes are listed on the Energize Denver website.
