SECTION 1. Purpose. The purpose of this chapter is to reduce the greenhouse gas emissions of buildings in Rhode Island, consistent with chapter 6.2 of title 42 (“2021 act on climate”). Of the building stock in 2050, approximately seventy percent (70%) has already been built, and addressing these existing buildings is critical to achieving net-zero emissions by 2050. As significant retrofits to existing buildings will eventually be needed, this chapter establishes a standard for their energy performance. Further, the intent of the legislature is to ensure that the Office of Energy Resources
(OER) has dedicated resources sufficient to administer its responsibilities under this chapter to enable swift and steady progress towards Rhode Island's net-zero mandate.
SECTION 2. Title 23 of the General Laws entitled "HEALTH AND SAFETY" is hereby amended by adding thereto the following chapter: 23-27.5-1. Definitions. As used in this chapter:
(1) "BPS fund" means the building performance standard fund established in § 23-27.5-5.
(2) "Building improvement tool" means an online tool to help building owners and operators improve building energy and water efficiency and reduce greenhouse gas emissions through identifying, tracking, and verifying improvements and their performance, including the capability to integrate with ENERGY STAR Portfolio Manager.
(3) "Building performance standard" means an objectively verifiable numeric value of a defined building performance metric that covered properties are required to achieve by specified dates.
(4) "Commercial building" means a building or multiple buildings on a property of which not less than fifty percent (50%) of the gross floor area, including hallways or other common space, but excluding parking, is used for commercial, retail, office, professional, educational or other nonresidential purposes, or any grouping of commercial buildings designated by the OER as an appropriate reporting unit for the purposes of this section; provided, however, that "commercial building" shall not include a public facility or a building owned or leased by the federal government, and shall not include a facility in which the majority of energy is consumed for manufacturing, for the generation of electric power or district thermal energy to be consumed off site, for communications infrastructure, or for other process loads as determined by the OER.
(5) "Community impacted by poverty and environmental injustice" means census tracts that are highlighted as overburdened and underserved in the geospatial climate and economic justice screening tool (CEJST).
(6) "Condominium" means a property that combines separate ownership of individual units with common ownership of other elements such as common areas.
(7) "Covered property" means any of the following with at least twenty-five thousand square feet (25,000 sq. ft.) of gross floor area:
(i) A single building;
(ii) One or more buildings held in the condominium form of ownership, and governed by a single board of managers; or
(iii) Two (2) or more buildings that are served by the same electric or gas meter or are served by the same heating or cooling system(s), which is not a district energy system. Provided that buildings, spaces, or groups of buildings and spaces, that are sub-metered or otherwise subject to easy determination of the resource consumption attributable to each individual building, space, or group of buildings or spaces, shall be treated as separate "covered properties" as determined by the OER.
(8) “Department of environmental management” or “DEM” means the state government agency charged with supervising and controlling the protection, development, planning, and utilization of the natural resources of the state and of which the director is the chair of the executive climate change coordinating council.
(9) "District energy system" means a system serving multiple covered properties and consisting of non-combusting thermal energy generation, transfer, and distribution equipment providing thermal energy in the form of heat and/or heat rejection.
(10) "Executive climate change coordinating council" or "council" or "EC4" means the council established by § 42-6.2-1.
(11) "Gross floor area" means the total area of a covered property, measured between the outside surface of the exterior walls of the covered property building(s). The OER shall promulgate rules and procedures governing the calculation of gross floor area, including areas that shall be excluded from the calculation.
(12) “Office of energy resources” or “OER” means the state agency charged with leading Rhode Island towards a clean, affordable, reliable, and equitable energy future.
(13) "Owner" means any of the following:
(i) An individual or entity possessing title to a covered property;
(ii) The board of the owners' association, in the case of a condominium;
(iii) The master association, in the case of a condominium, where the powers of an owners' association are exercised by or delegated to a master association;
(iv) The board of directors, in the case of a cooperative apartment corporation; or
(v) An agent authorized to act on behalf of any of the above.
(14) "Performance metrics" means each of the objectively verifiable numeric measures of building performance as established by § 23-27.5-4(d).
(15) "Property type(s)" means a category of covered properties subject to the same interim and final building performance standards, as defined by the OER. Covered properties within each property type shall have shared characteristics that facilitate the implementation and enforcement of this law. The OER may define one or more property types to be identical to ENERGY STAR property types.
(16) "Public facility" means any public institution, public facility, or any physical asset owned, including its public real-property site, leased or controlled in whole or in part by this state, a public agency, a municipality or a political subdivision, that is for public or government use and that consumes energy.
(17) "Residential building" means a building or multiple buildings on a property of which not less than fifty percent (50%) of the gross floor area, including hallways and other common space serving residents, but excluding parking, is used for dwelling purposes, or any grouping of residential buildings designated by the OER as an appropriate reporting unit for the purposes of this chapter; provided, however, that "residential building" shall not include a public facility or a building owned or leased by the federal government.
(18) "Tenant" means any tenant, tenant-stockholder of a cooperative apartment corporation, or condominium unit owner.
(19) "Utility" means a company, cooperative, association, or government entity that distributes and sells electricity, natural gas, or district energy for use in buildings. 23-27.5-2. Authority. The office of energy resources is hereby granted authority to administer this chapter, which shall include the authority to issue forms and guidance, promulgate rules and regulations, apply for and receive federal funds, assess and receive fees, and contract with third parties to effectuate the powers granted herein. The OER shall consult with the department of environmental management regarding the emissions-based enforcement and reporting requirements of this chapter, for which the DEM shall be responsible. 23-27.5-3. Advisory board.
(a) For purposes of this chapter, the green building advisory committee (GBAC) established pursuant to § 37-24-5(g) shall act as an advisory board to the OER concerning the implementation of this chapter including, but not limited to, the establishment of the building performance standards, technical assistance, owner needs, outreach and education, opportunities for funding related to the chapter, the implementation of state policies, programs, and statutes related to the chapter and recommendations for building performance standards.
(b) No later than one hundred and twenty (120) days following the enactment of this chapter, the OER shall establish the environmental justice advisory board (EJAB) to advise the OER on climate change efforts with respect to potential impacts on, benefits to, and special considerations for individuals and communities impacted by poverty and environmental injustice.
(1) The EJAB shall be comprised of no fewer than nine (9) and no more than fifteen (15) individuals who are representatives of communities impacted by poverty and environmental injustice, representatives of nonprofit and public agencies who work with such individuals or communities, including providers of affordable housing, small business owners or organizations, and experts in areas related to racial and social equity, as well as one representative from the Rhode Island AFL-CIO. The commissioner of the OER shall select individuals in consultation with the EC4 advisory board, to serve on the EJAB following an opportunity for the public to apply in consultation with the EC4 advisory board.
(2) All appointments to the EJAB shall be for a term of three (3) years. Members whose appointed terms have expired shall be permitted to continue to serve for up to one year until reappointed or replaced by a new appointee.
(3) The OER shall fairly compensate EJAB members and provide stipends to cover the cost of childcare and information technology needs as determined by the EJAB and EC4.
(4) The EJAB shall advise the OER and DEM on the implementation of this chapter with respect to potential impacts on, benefits to, and special considerations for individuals and communities impacted by poverty and environmental injustice, and small business owners from such communities.
(5) The EJAB may develop a plan to allocate funds available in the BPS fund, established under § 23-27.5-5(g), to improve the performance of covered buildings and ensure that those investments benefit such communities.
(6) The EJAB may host, in partnership with the GBAC and the OER, public meetings to gather input regarding the benchmarking program as well as the design and implementation of the building performance standards and complementary programs. Equitable engagement shall be a priority. 23-27.5-4. Building performance improvement.
(a) On a regular basis, the OER shall evaluate data relevant to understanding the energy use and greenhouse gas emissions of buildings in Rhode Island. The OER and DEM shall jointly publish reports summarizing the data and the status of building emissions in Rhode Island biennially.
(b) No later than December 31, 2027, the OER and DEM shall publish a report including a summary of its activities and progress under this chapter and detailing recommended measures, policies and programs to achieve building emission reductions aligned with Rhode Island's net zero goal. The OER and DEM shall issue supplemental reports biennially for a period of twenty (20) years.
(c) Performance metrics shall include site energy use intensity and may also include greenhouse gas emissions or other metrics relevant to the purpose of this chapter.
(d) No later than December 31, 2028, the OER and DEM shall select performance metrics and set a building performance standard for each property type or subcategory.
(e) The OER shall set final building performance standards that shall collectively cause the aggregate greenhouse gas emissions attributable to all covered properties to be reduced in line with reaching net zero by 2050.
(f) The OER and DEM shall set interim building performance standards for covered properties that are applicable at the end of each five (5) year period between adoption and 2050. In doing so a straight-line trajectory may be used, from the covered property's baseline performance for each performance metric to the final building performance standard for that performance metric such that each calculated performance metric shall improve in equal increments during each five
(5) year period. The DEM may use other means to calculate interim building performance standards if it deems the straight-line trajectory approach ill-suited for a covered property type.
(g) As of June 30, 2035, and at the end of every five (5) year period thereafter, the owner of a covered property shall demonstrate progress toward each applicable final building performance standard by achieving the interim building performance standard(s) set by the OER for the covered property.
(h) If the owner of a covered property believes that the owner cannot reasonably meet one or more of the applicable interim or final building performance standards, then the owner may propose an alternative building performance action plan to the OER. If the OER approves an alternative building performance action plan for a covered property, then the owner shall be responsible only to comply with the provisions of the alternative building performance action plan until the next compliance date.
(i) The OER shall issue forms, guidance and promulgate regulations necessary to implement this section including requirements for building performance action plans.
(j) In consultation with the EJAB, the OER shall provide technical assistance for owners lacking the financial, operational, or technical capacity to meet interim or final building performance standards. To the extent possible, such assistance shall include information on potential loan, grant, and other financing options for owners.
(k) The OER shall coordinate with utility companies, energy efficiency program administrators, the public utilities commission, state agencies, and local governments, as appropriate, to support the implementation of its recommendations pursuant to this section.
(l) In the case of a municipality that has initiated a building energy performance requirement prior to the enactment of this law, the municipality may continue such program in lieu of the requirements to be established by the OER under this section. In such case, the municipality must notify the OER of such intent within one hundred eighty (180) days of the enactment of this chapter and must provide program and performance information to the OER and DEM annually thereafter for reporting compliance. 23-27.5-5. Compliance assurance.
(a) The OER shall establish a program to maximize owner compliance with this chapter. In coordination with the DEM, the OER shall issue forms, guidance and promulgate regulations as necessary to implement the compliance program, and shall revise such forms, guidance and regulations from time to time as needed.
(b) The OER may grant an extension, adjustment or exemption to an interim or final building performance standards for a covered property whose owner submits a request, together with documentation, in a form and date prescribed by the OER, if the covered property meets any of the following criteria:
(1) A demolition permit was issued, or demolition is planned, that will prevent achievement of the next interim building performance standard;
(2) The covered building did not have a certificate of occupancy or temporary certificate of occupancy for all twelve (12) months of the baseline year prior to the interim building performance standard compliance schedule;
(3) The covered property is in financial hardship, as defined guidance or regulations issued by the OER; or
(4) The OER determines that strict compliance with the provisions of this law would cause financial hardship or would not be in the public interest. Any approved alternative, extension, adjustment or exemption shall apply only to the specific interim or final building performance standard and shall expire no later than the end of the relevant five (5) year period.
(c) The OER shall establish penalties for violations of this chapter through promulgation of regulations issued pursuant to this chapter. In doing so, the OER shall endeavor to minimize disproportionate impacts on communities impacted by poverty and environmental injustice. The OER may coordinate with the DEM for enforcement of the building performance standards, and the standards and requirements herein.
(d) Pursuant to each of the benchmarking requirements and the building performance standards established under this chapter, the OER shall establish in regulations the process and criteria for a building owner to apply for, and for the OER to grant or deny:
(1) A deadline extension; and/or
(2) A hardship waiver.
(e) The OER shall establish penalties for covered properties for violation of benchmarking requirements and for violation of building performance standards. Such payment amounts or formula shall reflect:
(1) The total number of annual benchmarking submissions which a covered property has failed to achieve;
(2) The total number of interim and final building performance standards which a covered property has failed to achieve;
(3) The assessed value of the covered property; and
(4) The magnitude of non-compliance under each performance metric.
(f) An owner whose covered property fails to comply with benchmarking requirements or meet an interim or final building performance standard by the applicable compliance date shall be required to make a penalty payment. Any owner who does not reside or conduct their business in the covered property, but leases the covered property to a tenant or multiple tenants, shall remain the party responsible for ensuring compliance with this section. Any penalty payments rendered as a result of non-compliance shall not be passed on to any tenant who may lease the covered property in order to offset the cost to the owner.
(g) The BPS fund is hereby established as a permanent designated fund managed by the OER. The BPS fund shall be used to support the building benchmarking and performance improvement program established in this law.
(1) All funds collected from payment of penalties assessed shall be deposited into the BPS fund.
(2) All funds deposited into the BPS fund, and any interest earned on the funds, shall not revert to the unrestricted fund balance of the general fund at the end of a fiscal year, or at any other time, but shall be continually available for the uses and purposes set forth in this chapter without regard to fiscal year limitation.
(3) Additional funds from other sources may also be deposited into the BPS fund. 23-27.5-6. Rules and regulations. The OER shall promulgate rules and regulations to implement and enforce the provisions of this chapter. 23-27.5-7. Appeals. An owner aggrieved by this chapter or compliance orders resulting therefrom may appeal pursuant to the provisions of chapter 35 of title 42 ("administrative procedures").
SECTION 3. This act shall take effect upon passage.
