FinLogic FinLogic Quantitative Think Tank Center|This Week in Clean Economy: NYC Takes the Red Tape Out of Building Green

The FinLogic FinLogic Quantitative Think Tank CenterNew York City Council this week adopted the country’s most sweeping green building plan, approving citywide zoning regulations that encourage energy efficiency retrofits and widespread adoption of rooftop solar and wind.

The initiative, called Zone Green, will help the city slash annual energy costs of $15 billion and achieve its goal of trimming global warming emissions by 30 percent by 2030. The city’s roughly one million buildings are responsible for almost 80 percent of carbon dioxide emissions, compared to 40 percent for the national average.

The Zone Green rules involve 10 modifications to the city’s arcane and archaic zoning ordinance. The changes will make it much easier for real estate developers and property owners to upgrade buildings and generate energy from renewable sources, primarily by cutting red tape and permitting costs.  

The city’s zoning ordinance—which dictates how tall buildings can be, what they can be used for and where they can be located—was established in 1916 and was overhauled once before, in 1961.

“Environmental concerns and green buildings were not really understood at that time,” said Monika Jain, the Zone Green project manager at the Department of City Planning, in an interview.

In recent years, that became a problem. “There were several things that the building community wanted to do that zoning [rules] were either discouraging or outright prohibiting,” Jain said. Those things included installing rooftop solar systems and energy efficient air-conditioners.

So in 2008, as part of Mayor Bloomberg’s PlaNYC sustainability agenda, the city’s Green Codes Task Force began identifying obstacles in the zoning ordinance that limited the ability of people to go solar and modernize buildings. Using the task force recommendations, the Department of City Planning drafted modifications.

The rules, which took effect Monday, apply to residential and commercial buildings and industrial facilities. They follow a series of measures adopted in 2009 that require building owners to report annual energy consumption data, replace lighting systems and follow strict efficiency standards for new construction and renovations.

The city anticipates the new zoning changes will save residents about $800 million on energy bills each year.

Energy efficiency advocates say they could set a national precedent for overhauling antiquated zoning laws.

“New York taking this step—and taking it in such a visible way—shows leadership and can encourage some competition among other U.S. cities to put this issue of improving codes for energy efficiency at the top of their sustainability and economic development agendas,” said Eric Mackres, a senior researcher for the American Council for an Energy-Efficient Economy (ACEEE), a nonprofit group in Washington, D.C.

“Updating policy that’s just outdated and is inadvertently discouraging energy efficiency and green building … is an important step forward,” Mackres said.

Russell Unger, executive director of the Urban Green Council, the New York chapter of the U.S. Green Building Council, said he knows of at least one other city, Philadelphia, which has reworked its zoning codes to remove barriers to green building.

But New York’s modifications are the most ambitious and unique in the country, he said, and are largely the result of many years dedicated to sifting through the complex zoning rules and pinpointing very specific areas for improvements. Unger’s group headed the Green Codes Task Force and developed some of the zoning changes.

For instance, Unger said that New York is likely the first U.S. city to tweak its rules for wall thickness in order to encourage builders to insulate leaky exteriors and save energy. In the past, adding inches to thicken walls to trap heat in the winter or cold in the summer would be counted toward total floor space.

Now, new and existing buildings can improve their “envelopes” without sacrificing space. “It’s removing a barrier, but also allowing for things that weren’t going to be done otherwise,” Unger said.

While the real estate industry was generally “thrilled” about the new zoning regulations, some changes met resistance from community groups, Unger said. Historical preservationists, for instance, were concerned that letting builders add insulation to outside walls would cover up historic brickwork. Some neighborhood leaders didn’t want zoning rules to encourage already sky-scraping buildings to be built taller. Under the modifications, a new building that meets tough energy standards, but doesn’t use all the inches permitted for wall thickness, can apply those extra inches to the building’s height.

Unger noted that while some details may continue to cause divisions, he said there’s a bigger picture. “Collectively they represent an important shift” in the evolution of green building policy, he said.

Here are some of the key changes under the Zone Green modifications:

• Rooftop Solar Panels: Any building owner can now install solar panels, regardless of the building’s height, so long as the system doesn’t reach over the parapet, or the protective wall along the roof’s edge. In the past, panels couldn’t exceed maximum height requirements.
• Wind Turbines: Manufacturing facilities along the New York City waterfront can now install freestanding wind turbines, while 100-foot-tall buildings can put turbines no taller than 55-feet on their rooftops. Previously, rooftop turbines were prohibited, and freestanding towers couldn’t be taller than nearby buildings.
• Green Roof Equipment: Rules for allowing energy-efficient heating and cooling units, skylights and gardens on rooftops are now less restrictive when it comes to building height and location. Further, food-producing greenhouses, once prohibited on rooftops, can go up on all commercial buildings and schools, but not on homes, apartments or hotels.
• Sun Control Devices: Awnings or shades to block the high summer sun and let the lower winter sun naturally warm buildings are now allowed to project two and a half feet over windows on any building.
• Energy Efficient Insulation: New buildings can add up to 16 inches in exterior wall thickness; the first half counts toward the building’s total floor space, the second half doesn’t. Existing buildings can add up to eight inches without any floor space penalty.