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Energy Star
Energy Star is a program created and administered by the Environmental Protection Agency. The program has two components: the Energy Star appliance labeling system, which helps consumers identify energy efficient microwaves, televisions, and other items, and Portfolio Manager, an online tool used to track energy and water consumption in buildings.
Portfolio Manager is of particular importance to the commercial real estate industry, as is it used to benchmark energy consumption data of more than 40 percent of domestic commercial building space. Participation is voluntary, though a number of local governments, in addition to the state of California, require its use in order to enforce mandatory benchmarking laws. The data can be applied to a standardized national benchmark and helps building owners and architects assess energy use relative to similar buildings in the program. Furthermore, buildings that meet certain EPA criteria for energy efficiency are deemed “Energy Star certified,” making them more attractive to tenants and investors.
Issue
As part of a broader effort to cut federal spending levels, proposals have been made to eliminate the Energy Star program. Doing so would not only deprive the real estate community of a valuable tool to monitor, compare, and reduce energy consumption, but would also create significant compliance issues for building owners in localities that require the disclosure of benchmarking data. The Energy Star Portfolio Manager tool was originally conceived as a voluntary program, rather than a directive. Mandates requiring energy benchmarking are already well established by many local governments, and elimination of Energy Star would create uncertainty for public and private sector stakeholders
Status
Eliminating Energy Star may arise in the context of reducing overall federal agency spending levels, either in the development of annual appropriations legislation or in a broader debate over increasing the nation's debt limit.
Position
NAIOP supports voluntary measures to promote energy efficiency, and has joined with others in the real estate community to convey to lawmakers the importance of maintaining programs like Energy Star that are voluntary in nature.
Talking Points
- Energy Star is a voluntary program that leverages public-private partnerships to reduce energy consumption.
- Portfolio Manager is used to track the energy usage of more than 40 percent of all U.S. commercial real estate space, including in several localities that mandate disclosure of this information. Eliminating the program would therefore lead to significant compliance challenges for local governments and private sector businesses alike.
- Energy Star is a proven job creator, and encourages well-paying American manufacturing, construction, and other related jobs.
- The program saves billions of dollars for families and businesses. In 2015 alone, businesses cumulatively saved $3.4 billion on utility bills through the Energy Star buildings program.
- Energy Star enhances the nation’s energy security and independence, and incentivizes the construction of resilient buildings and infrastructure.
- The program boosts real estate property values, as Energy Star-rated buildings have become an important indicator for profitable and sustainable assets, two key metrics for investors and tenants.