BENCHMARKING & BEYOND - Are You Ready?

Federal, state, and municipal governments are taking steps to reduce energy consumption to help lower energy bills by introducing various building performance standards. Two new laws in Washington are in place one at the State level and another with the City of Seattle. These laws will have ramifications for some multifamily buildings. Even if you are not required to comply, taking measures to improve building performance that reduce your energy bills is always a good thing. The best time to plan for and implement energy-efficient measures is NOW!

Yes, here in Washington, we have two different laws with a similar goal: reduce consumption! If a property is within the City of Seattle limits, then it needs to meet both requirements. So, what are these laws, and what do they mean for you?

Washington’s Clean Buildings Performance Standards (CBPS)

All buildings over 20,000 square feet are subject to the state’s CBPS law. This law has so many nuances that it is very confusing for most to capture. The CBPS program has two tiers: Buildings larger than 50,000 sq ft are Tier 1, and buildings that are 20,000 – 50,000 sq ft are Tier 2. A Tier 1 multifamily building can apply as a Tier 2 building. For many, Tier 2 is the best approach because it gives you more time to get ready. Notices have just been sent out from the Department of Commerce on July 1, 2025, with directions on setting up your portal account. Beginning on July 1, 2027, Tier 2 buildings need to provide three things: benchmarking, an operations and maintenance program (O&M), and an energy management plan (EMP). But what is all of that?

Seattle has been benchmarking buildings for several years now. Benchmarking measures how much energy the building is using per sq ft/year. Building managers, owners, and board members can use benchmarking to assess their consumption and plan for improvements. Benchmarking involves setting up an Energy Star Portfolio Manager account for each building.

The O&M and EMP are required to be done by a Qualified Person, and they use your reserve study/capital expenditure plan as a starting point. The O&M is a list of all the building components that use energy, including the building enclosure, with information about how to best manage the components to keep them efficient. The EMP identifies how you will get your building as close to net zero by 2050. It is a road map showing when you will replace items with more efficient ones, like changing the lights to LEDs.

The state will set energy use intensity (EUI) targets for Tier 2 buildings in 2030. The targets will likely be reduced every five years to achieve the 2050 goal. That means compliance is not likely to be a one-time/one-project solution.

City of Seattle’s Building Emissions Performance Standards (BEPS) Program

The BEPS program focuses on reducing emissions generated by natural gas or other fossil fuel energy sources versus energy consumption as a whole. Fossil fuel use is measured as greenhouse gas intensity (GHGI). If your building has commercial spaces, you will need to include both commercial and residential spaces to calculate the total energy use for the building. The BEPS program has other nuances that you will need the help of a consultant to walk you through. Which way is the best path forward for your building? The City already has specific building use targets for the different types of use within the building.

The first requirement date is based on the size of the building. Beginning in 2027, buildings need to have benchmarking, an equipment list, and an emission reduction plan. Similar to the state’s requirements, to perform the work needed, there are specific qualifications. The requirements are on a five-year cycle with more demanding targets for each cycle.

Legal Consequences

With both of these laws, financial penalties may be imposed on building owners who fail to submit the required reports or buildings that do not achieve the targets.

Reserve Studies/Capital Expenditure Plans

All building components have an expected life cycle. In the past, reserve studies were used to anticipate the timing and cost of replacing major building components on a “like for like” basis. The new laws require that all energy-consuming components meet the most stringent energy efficiency standards based on the local jurisdiction. This means that a boiler may need to be replaced with a heat pump, which will triple (sometimes more) the cost of the replacement. You may have additional costs to hire consultants who can determine where and how things will change. This requirement will have a significant impact on the cost, and owners should discuss this cost change with their reserve specialist/financial planner.

Road Map

When you see BPS deadlines several years in the future, you may assume you have plenty of time to comply with the new requirements. But it is important to understand the scope of the work that will be required. The most important thing is to start now! By planning ahead and implementing energy savings and decarbonization into your current or future projects, you will help your community meet these compliance requirements. Use the road map below to guide you through this.

• Develop an energy plan committee. This committee can help the owners and residents navigate the impact of these complex programs. This group will do the heavy lifting of becoming educated about the program(s) and should have a mix of technical, financial, management, and communication skills. They will be the ones to do the benchmarking.
• Identify potential consultants who can partner with your community. Identify and budget for a third-party energy consultant (“Qualified Energy Auditor or Certified Energy Manager”) per your local requirements. Or designate an in-house specialist to perform these tasks if it is allowed by the regulations. Collaborate with the auditor/consultant to develop a full list of all building components and their related energy usage. Use this list, in tandem with the reserve study/capital expenditure plan, to prioritize upgrades that will improve efficiency and achieve the initial targets or beyond.
• Collaborate with legal counsel to analyze your governing documents and determine changes needed. Achieving full compliance with some BEPS programs may impact lease agreements, like replacing gas water heaters with individual heat pump water heaters.
• Identify incentives. Your local municipality and/or utility providers may offer incentives for your building. The federal government is offering a variety of incentives through the Inflation Reduction Act of 2022. The CBPS Early Adopter Incentive program is open up for Tier 2.
• Develop realistic budgets. Future operating budgets should account for the use of energy consultants and higher reserve study costs.
• Educate your residents on energy efficiency. Help them understand that federal, state, and local municipalities have laws that require the installation of the most energy-efficient appliance models. Develop a culture that rewards residents who help the community achieve compliance.

These programs will have a dramatic impact on many communities moving forward. The key to ensuring your building meets these new requirements will be careful planning, additional financial resources, and fostering awareness and support for a long-term strategy. Taking proactive steps now may help you avoid costly penalties in the future.

As Senior Consultant in RDH’s Seattle office, Michael Arndt helps building owners improve the resilience and long-term performance of existing buildings. He leads RDH’s work on Washington’s Clean Buildings Performance Standard (CBPS) and Seattle’s Building Emissions Performance Standard (BEPS), and contributes to related policy discussions in Oregon—focusing especially on multifamily housing. RDH, founded in 1997, is a leading consulting firm with 11 offices and 325+ experts delivering building science–based solutions in assessment, design, energy, and construction. Contact Michael at marndt@rdh.com, 206-462-5726, or visit RDH Seattle at 2101 N 34th St. #150, Seattle, WA 98103.

The views expressed in this article are solely that of the author and do not necessarily reflect the views of RHAWA.