If you own or operate a building in Washington, DC, you should be paying attention to the District’s Building Energy Performance Standards (BEPS). This policy requires buildings to meet a minimum level of energy performance. If your building does not meet that requirement, you must take steps to reduce building energy use or face financial penalties of up to $10 / square foot of building area. The policy currently applies to privately owned buildings 50,000 ft² and larger. Starting in 2027, the policy will apply to privately owned buildings 25,000 ft² and larger.

For buildings that do not meet the standards, they must follow one of four compliance pathways. An overview of all pathways is provided in Part 3 of our BEPS series. The performance pathway is described in more detail below.

Requirements

The Performance Pathway requires that a property reduce its adjusted site energy by 20% over the course of the BEPS Compliance Cycle. Site energy is the total energy used onsite and includes energy purchased from electric utilities, gas companies, fuel oil companies, etc., and any renewable energy produced and utilized on the premises.

The site energy adjustment is different for every building type and accounts for changes in weather, hours of operation, number of occupants, and other metrics between the baseline and evaluation periods. For example, despite achieving a 14.1% reduction in energy use compared to the 2019 baseline, the building in the graph below consumed 9.5% more energy when adjusted for lower occupancy rates and weather changes. As a result, it must implement additional measures to comply with BEPS Cycle 1.

Timeline

For each BEPS cycle (BEPS-1, BEPS-2, BEPS-3, etc.), a property’s baseline performance is established by using the average site energy use for the two years preceding the first year of the BEPS cycle. For the 2027 cycle (BEPS-2), the baseline years will be 2025 and 2026.  To determine if a property meets the 20% requirement, a property’s average site energy use over the last two years of the Compliance Cycle is compared to the base performance. For BEPS-2, the performance period will be 2030 and 2031.

For BEPS-1, the timing for this pathway is modified due to the COVID-19 Public Health Emergency (PHE), unless a property opts out of the delay. For BEPS-1, the base performance will be based on the average site energy use for 2018 and 2019. Site energy use for 2026 will be used to evaluate the level of energy savings that is achieved.

Properties that pursue this pathway will need to identify and implement measures that reduce their site energy by 20% or more. For standard BEPS cycles, measures will need to be implemented by the end of the third year of the Compliance Cycle. For example, for BEPS-2 measures will need to be completed by the end of 2029 to impact the energy performance in 2030. Due to the PHE delay, for BEPS-1, measures need to be in place by the end of 2025 so that they impact energy used in 2026.

Penalty

The maximum financial penalties are $10 / square foot of gross floor area. The final penalty will be adjusted based on the achieved energy use reduction, see the example below.

Performance Pathway Compliance Checklist

The steps to planning for and following this pathway are to evaluate opportunities to reduce energy use to determine if 20% savings can be achieved. Building owners who chose the Performance Pathway in 2023 will have to identify and implement Energy Efficiency Measures (EEMs) that total at least 20% energy savings from the 2018/2019 baseline. Often, the first step in the process is an energy audit that identifies savings opportunities and evaluates individual measures for their energy savings, feasibility, implementation timeframe, and financial performance.

Because 2026 will be used as the evaluation period, all measures must be implemented before the end of 2025 to have an impact in 2026. Larger projects may take up to 12 months to complete, 2024 is, therefore, the last year to identify and implement potential EEMs. The next reporting requirement is for the submission of a Completed Actions Report and Verified Benchmarking data for 2026 by April 1, 2027, meaning building owners cannot rely on savings resulting from reduced occupancy rates.

Conclusion

The Performance Pathway gives property owners the freedom to implement EEMs of their choice as long as they do not compromise occupant health or comfort. While this pathway offers the most freedom, it also comes with the highest risk of not meeting the 20% hurdle if measures are not chosen carefully or implemented correctly.

The performance pathway makes sense for properties with relatively poor energy performance that have clear, easy-to-implement options to reduce energy use by 20% or more and do not mind taking on some risk when it comes to complying. It is also a good option for properties that can implement measures early in the Compliance Cycle allowing time to evaluate performance and take additional measures if needed.

Do you have questions on how to comply with the Performance Pathway?