The impact of mandatory energy audits on building energy use

Abstract

Cities are increasingly adopting energy policies that reduce information asymmetries and knowledge gaps through data transparency, including energy disclosure and mandatory audit requirements for existing buildings. Although such audits impose non-trivial costs on building owners, their energy use impacts have not been empirically evaluated. Here we examine the effect of a large-scale mandatory audit policy—New York City’s Local Law 87—on building energy use, using detailed audit and energy data between 2011 and 2016 for approximately 4,000 buildings. This specific policy context, in which the compliance year is randomly assigned, provides a unique opportunity to explore the audit effect without the self-selection bias found in studies of voluntary audit policies. We find energy use reductions of approximately –2.5% for multifamily residential buildings and –4.9% for office buildings. The results suggest that mandatory audits, by themselves, create an insufficient incentive to invest in energy efficiency at the scale needed to meet citywide carbon-reduction goals.

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Fig. 1: EUI distribution pre-, during and postaudit period.
Fig. 2: Audit coefficient distribution (multifamily housing).
Fig. 3: Audit coefficient distribution (office).

Data availability

All data, except LL87 data, are available through the NYC Open Data Portal at https://opendata.cityofnewyork.us/. LL87 data are available upon reasonable request, and with permission, from the NYC Mayor’s Office of Sustainability. The data that support the plots within this Article and other findings of this study can be obtained from the NYC Mayor’s Office of Sustainability or the authors, upon permission from the NYC Mayor’s Office of Sustainability who own the data.

Code availability

Any applicable code relevant to the findings is available from the authors upon reasonable request.

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Acknowledgements

We thank the NYC Mayor’s Office of Sustainability for sharing the LL84 benchmarking and LL87 energy audit data used in this study. We also thank participants at the ‘Next Generation Building Efficiency Policies’ workshop hosted by the NYU Law School and NYU Marron Institute for their feedback on preliminary versions of this work, and K. Hoffman for useful discussions on methodology. The research was supported by National Science Foundation Grant no. 1653773 and by the Sloan Foundation. All errors remain our own.

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Correspondence to Constantine E. Kontokosta.

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Kontokosta, C.E., Spiegel-Feld, D. & Papadopoulos, S. The impact of mandatory energy audits on building energy use. Nat Energy 5, 309–316 (2020). https://doi.org/10.1038/s41560-020-0589-6

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