Clean buildings standard

AN ACT Relating to increasing compliance pathways for the clean 1
buildings performance standard with alternative metrics and 2
extensions for reporting; amending RCW 19.27A.170, 19.27A.210, 3
19.27A.220, and 19.27A.250; and reenacting and amending RCW 4
19.27A.140 and 19.27A.200. 5
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:6
Sec. 1. RCW 19.27A.140 and 2019 c 285 s 9 are each reenacted and 7
amended to read as follows: 8
The definitions in this section apply to RCW 19.27A.130 through 9
19.27A.190 and 19.27A.020 unless the context clearly requires 10
otherwise. 11
(1) "Benchmark" means the energy used by a facility as recorded 12
monthly for at least one year and the facility characteristics 13
information inputs required for a portfolio manager.14
(2) "Building owner" has the same meaning as defined in RCW 15
19.27A.200. 16
(3) "Conditioned space" means conditioned space, as defined in 17
the Washington state energy code. 18
(4) "Consumer-owned utility" includes a municipal electric 19
utility formed under Title 35 RCW, a public utility district formed 20
under Title 54 RCW, an irrigation district formed under chapter 87.03 21
Z-0211.2
SENATE BILL 5514
State of Washington 69th Legislature 2025 Regular Session
By Senators Shewmake, Krishnadasan, and Nobles; by request of
Department of Commerce
Read first time 01/27/25. Referred to Committee on Environment,
Energy & Technology.
p. 1 SB 5514
RCW, a cooperative formed under chapter 23.86 RCW, a mutual 1
corporation or association formed under chapter 24.06 RCW, a port 2
district formed under Title 53 RCW, or a water-sewer district formed 3
under Title 57 RCW, that is engaged in the business of distributing 4
electricity to one or more retail electric customers in the state.5
(5) "Cost-effectiveness" means that a project or resource is 6
forecast: 7
(a) To be reliable and available within the time it is needed; 8
and 9
(b) To meet or reduce the power demand of the intended consumers 10
at an estimated incremental system cost no greater than that of the 11
least-cost similarly reliable and available alternative project or 12
resource, or any combination thereof. 13
(6) "Council" means the state building code council.14
(7) "Covered ((commercial)) building" has the same meaning as 15
defined in RCW 19.27A.200. 16
(8) "Embodied energy" means the total amount of fossil fuel 17
energy consumed to extract raw materials and to manufacture, 18
assemble, transport, and install the materials in a building and the 19
life-cycle cost benefits including the recyclability and energy 20
efficiencies with respect to building materials, taking into account 21
the total sum of current values for the costs of investment, capital, 22
installation, operating, maintenance, and replacement as estimated 23
for the lifetime of the product or project. 24
(9) "Energy consumption data" means the monthly amount of energy 25
consumed by a customer as recorded by the applicable energy meter for 26
the most recent twelve-month period. 27
(10) "Energy service company" has the same meaning as in RCW 28
43.19.670. 29
(11) "Enterprise services" means the department of enterprise 30
services. 31
(12) "Greenhouse gas" and "greenhouse gases" includes carbon 32
dioxide, methane, nitrous oxide, hydrofluorocarbons, 33
perfluorocarbons, and sulfur hexafluoride. 34
(13) "Investment grade energy audit" means an intensive 35
engineering analysis of energy efficiency and management measures for 36
the facility, net energy savings, and a cost-effectiveness 37
determination. 38
(14) "Investor-owned utility" means a corporation owned by 39
investors that meets the definition of "corporation" as defined in 40
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RCW 80.04.010 and is engaged in distributing either electricity or 1
natural gas, or both, to more than one retail electric customer in 2
the state. 3
(15) "Major facility" means any publicly owned or leased 4
building, or a group of such buildings at a single site, having ten 5
thousand square feet or more of conditioned floor space.6
(16) "National energy performance rating" means the score 7
provided by the energy star program, to indicate the energy 8
efficiency performance of the building compared to similar buildings 9
in that climate as defined in the United States environmental 10
protection agency "ENERGY STAR® Performance Ratings Technical 11
Methodology." 12
(17) "Net zero energy use" means a building with net energy 13
consumption of zero over a typical year. 14
(18) "Portfolio manager" means the United States environmental 15
protection agency's energy star portfolio manager or an equivalent 16
tool adopted by the department of enterprise services.17
(19) "Preliminary energy audit" means a quick evaluation by an 18
energy service company of the energy savings potential of a building.19
(20) "Qualifying public agency" includes all state agencies, 20
colleges, and universities. 21
(21) "Qualifying utility" means a consumer-owned or investor-22
owned gas or electric utility that serves more than twenty-five 23
thousand customers in the state of Washington. 24
(22) "Reporting public facility" means any of the following:25
(a) A building or structure, or a group of buildings or 26
structures at a single site, owned by a qualifying public agency, 27
that exceed ten thousand square feet of conditioned space;28
(b) Buildings, structures, or spaces leased by a qualifying 29
public agency that exceeds ten thousand square feet of conditioned 30
space, where the qualifying public agency purchases energy directly 31
from the investor-owned or consumer-owned utility;32
(c) A wastewater treatment facility owned by a qualifying public 33
agency; or 34
(d) Other facilities selected by the qualifying public agency.35
(23) "State portfolio manager master account" means a portfolio 36
manager account established to provide a single shared portfolio that 37
includes reports for all the reporting public facilities.38
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Sec. 2. RCW 19.27A.170 and 2019 c 285 s 10 are each amended to 1
read as follows: 2
(1) On and after January 1, 2010, qualifying utilities shall 3
maintain records of the energy consumption data of all nonresidential 4
and qualifying public agency buildings to which they provide service. 5
This data must be maintained for at least the most recent twelve 6
months in a format compatible for uploading to the United States 7
environmental protection agency's energy star portfolio manager.8
(2) On and after January 1, 2010, upon the written authorization 9
or secure electronic authorization of a nonresidential building owner 10
or operator, a qualifying utility shall upload the energy consumption 11
data for the accounts specified by the owner or operator for a 12
building to the United States environmental protection agency's 13
energy star portfolio manager in a form that does not disclose 14
personally identifying information. 15
(3) In carrying out the requirements of this section, a 16
qualifying utility shall use any method for providing the specified 17
data in order to maximize efficiency and minimize overall program 18
cost. Qualifying utilities are encouraged to consult with the United 19
States environmental protection agency and their customers in 20
developing reasonable reporting options. 21
(4) Disclosure of nonpublic nonresidential benchmarking data and 22
ratings required under subsection (5) of this section will be phased 23
in as follows: 24
(a) By January 1, 2011, for buildings greater than fifty thousand 25
square feet; and 26
(b) By January 1, 2012, for buildings greater than ten thousand 27
square feet. 28
(5) Based on the size guidelines in subsection (4) of this 29
section, a building owner or operator, or their agent, of a 30
nonresidential building shall disclose the United States 31
environmental protection agency's energy star portfolio manager 32
benchmarking data and ratings to a prospective buyer, lessee, or 33
lender for the most recent continuously occupied twelve-month period. 34
A building owner or operator, or their agent, who delivers United 35
States environmental protection agency's energy star portfolio 36
manager benchmarking data and ratings to a prospective buyer, lessee, 37
or lender is not required to provide additional information regarding 38
energy consumption, and the information is deemed to be adequate to 39
inform the prospective buyer, lessee, or lender regarding the United 40
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States environmental protection agency's energy star portfolio 1
manager benchmarking data and ratings for the most recent twelve-2
month period for the building that is being sold, leased, financed, 3
or refinanced. 4
(6) Notwithstanding subsections (4) and (5) of this section, 5
nothing in this section increases or decreases the duties, if any, of 6
a building owner, operator, or their agent under this chapter or 7
alters the duty of a seller, agent, or broker to disclose the 8
existence of a material fact affecting the real property.9
(7) An electric or gas utility that is not a qualifying utility 10
must either offer the upload service specified in subsection (2) of 11
this section or provide customers who are building owners of covered 12
((commercial)) buildings with consumption data in an electronic 13
document formatted for direct upload to the United States 14
environmental protection agency's energy star portfolio manager. 15
Within sixty days of receiving a written or electronic request and 16
authorization of a building owner, the utility must provide the 17
building owner with monthly energy consumption data as required to 18
benchmark the specified building. 19
(8) For any covered ((commercial)) building with ((three or 20
more)) tenants, an electric or gas utility must, upon request of the 21
building owner, provide the building owner with aggregated monthly 22
energy consumption data without requiring prior consent from tenants.23
(9) Each electric or gas utility must ensure that all data 24
provided in compliance with this section does not contain personally 25
identifiable information or customer-specific billing information 26
about tenants of a covered ((commercial)) building.27
Sec. 3. RCW 19.27A.200 and 2022 c 177 s 2 are each reenacted and 28
amended to read as follows: 29
The definitions in this section apply throughout RCW 19.27A.210, 30
19.27A.220, 19.27A.230, 19.27A.240, and 19.27A.250((, and 31
19.27A.220)) unless the context clearly requires otherwise.32
(1) "Agricultural structure" means a structure designed and 33
constructed to house farm implements, hay, grain, poultry, livestock, 34
or other horticultural products, and that is not a place used by the 35
public or a place of human habitation or employment where 36
agricultural products are processed, treated, or packaged.37
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(2) "Baseline energy use intensity" means a building's energy use 1
intensity that is representative of energy use in a normal weather 2
year. 3
(3)(a) "Building owner" means an individual or entity possessing 4
title to a building. 5
(b) In the event of a land lease, "building owner" means the 6
entity possessing title to the building on leased land.7
(4) "Building tenant" means a person or entity occupying or 8
holding possession of a building or premises pursuant to a rental 9
agreement. 10
(5) "Conditional compliance" means a temporary compliance method 11
used by covered building owners that demonstrate the owner has 12
implemented energy use reduction strategies required by the standard, 13
but has not demonstrated full compliance with the energy use 14
intensity target or alternative metric. 15
(6) "Consumer-owned utility" has the same meaning as defined in 16
RCW 19.27A.140. 17
(7) "Covered building" includes a tier 1 covered building and a 18
tier 2 covered building. 19
(8) "Department" means the department of commerce.20
(9) "Director" means the director of the department of commerce 21
or the director's designee. 22
(10) "Electric utility" means a consumer-owned electric utility 23
or an investor-owned electric utility. 24
(11) "Eligible building owner" means: (a) The owner of a covered 25
building required to comply with the standard established in RCW 26
19.27A.210; or (b) all eligible tier 2 covered building owners.27
(12) "Energy" includes: Electricity, including electricity 28
delivered through the electric grid and electricity generated at the 29
building premises using solar or wind energy resources; natural gas, 30
including natural gas derived from renewable sources, synthetic 31
sources, and fossil fuel sources; district steam; district hot water; 32
district chilled water; propane; fuel oil; wood; coal; or other fuels 33
used to meet the energy loads of a building. 34
(13) "Energy use intensity" means a measurement that normalizes a 35
building's site energy use relative to its size. A building's energy 36
use intensity is calculated by dividing the total net energy consumed 37
in one year by the gross floor area of the building, excluding the 38
parking garage. "Energy use intensity" is reported as a value of 39
thousand British thermal units per square foot per year.40
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(14) "Energy use intensity target" means the target for net 1
energy use intensity of a covered building. 2
(15) "Gas company" includes every corporation, company, 3
association, joint stock association, partnership, and person, their 4
lessees, trustees, or receiver appointed by any court whatsoever, and 5
every city or town owning, controlling, operating, or managing any 6
gas plant within this state. 7
(16) "Greenhouse gas" includes carbon dioxide, methane, nitrous 8
oxide, hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride.9
(17)(a) "Gross floor area" means the total number of square feet 10
measured between the exterior surfaces of the enclosing fixed walls 11
of a building, including all supporting functions such as offices, 12
lobbies, restrooms, equipment storage areas, mechanical rooms, break 13
rooms, and elevator shafts. 14
(b) "Gross floor area" does not include outside bays or docks.15
(18) "Investor-owned utility" means a corporation owned by 16
investors that meets the definition of "corporation" as defined in 17
RCW 80.04.010 and is engaged in distributing either electricity or 18
natural gas, or both, to more than one retail electric customer in 19
the state. 20
(19) "Multifamily residential building" means a covered 21
multifamily building containing sleeping units or more than five 22
dwelling units where occupants are primarily permanent in nature.23
(20) "Net energy use" means the sum of metered and bulk fuel 24
energy entering the building, minus the sum of metered energy leaving 25
the building or campus. Renewable energy produced on a campus that is 26
not attached to a covered building may be included.27
(21) "Qualifying utility" means a consumer-owned or investor-28
owned gas or electric utility that serves more than 25,000 customers 29
in the state of Washington. 30
(22) "Savings-to-investment ratio" means the ratio of the total 31
present value savings to the total present value costs of a bundle of 32
an energy or water conservation measure estimated over the projected 33
useful life of each measure. The numerator of the ratio is the 34
present value of net savings in energy or water and nonfuel or 35
nonwater operation and maintenance costs attributable to the proposed 36
energy or water conservation measure. The denominator of the ratio is 37
the present value of the net increase in investment and replacement 38
costs less salvage value attributable to the proposed energy or water 39
conservation measure. 40
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(23) "Standard" means the state energy performance standard for 1
covered buildings established under RCW 19.27A.210.2
(24) "Thermal energy company" has the same meaning as defined in 3
RCW 80.04.550. 4
(25) "Tier 1 covered building" means a building where the sum of 5
nonresidential, hotel, motel, and dormitory floor areas exceed 50,000 6
gross square feet, excluding the parking garage area.7
(26) "Tier 2 covered building" means a building where the sum of 8
multifamily residential, nonresidential, hotel, motel, and dormitory 9
floor areas exceeds 20,000 gross square feet, but does not exceed 10
50,000 gross square feet, excluding the parking garage area. Tier 2 11
covered buildings also include multifamily residential buildings 12
where floor areas are equal to or exceed 50,000 gross square feet, 13
excluding the parking garage area. 14
(27) "Weather normalized" means a method for modifying the 15
measured building energy use in a specific weather year to energy use 16
under normal weather conditions. 17
Sec. 4. RCW 19.27A.210 and 2023 c 291 s 3 are each amended to 18
read as follows: 19
(1)(a) By November 1, 2020, the department must establish by rule 20
a state energy performance standard for covered ((commercial)) 21
buildings. 22
(b) In developing energy performance standards, the department 23
shall seek to maximize reductions of greenhouse gas emissions from 24
the building sector. The standard must include energy use intensity 25
targets by building type and methods of conditional compliance that 26
include an energy management plan, operations and maintenance 27
program, energy efficiency audits, and investment in energy 28
efficiency measures designed to meet the targets. The department 29
shall use ANSI/ASHRAE/IES standard 100-2018 as an initial model for 30
standard development. The department may adopt by rule subsequent 31
versions of standard 100 as its model for standard development. The 32
department must update the standard by July 1, 2029, and every five 33
years thereafter. Prior to the adoption or update of the standard, 34
the department must identify the sources of information it relied 35
upon, including peer-reviewed science. 36
(2) In establishing the standard under subsection (1) of this 37
section, the department: 38
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(a) Must develop energy use intensity targets that are no greater 1
than the average energy use intensity for the covered ((commercial)) 2
building occupancy type with adjustments for unique energy using 3
features. The department must also develop energy use intensity 4
targets for additional property types eligible for incentives in RCW 5
19.27A.220. The department may also develop targets for alternative 6
metrics related to energy use and greenhouse gas emissions if 7
alternative metrics are included in standard 100-2018 or subsequent 8
versions. The department must consider regional and local building 9
energy utilization data, such as existing energy star benchmarking 10
data, in establishing targets for the standard. Energy use intensity 11
targets or alternative metrics must be developed for two or more 12
climate zones and be representative of energy use in a normal weather 13
year; 14
(b) May consider building occupancy classifications from ANSI/15
ASHRAE/IES standard 100 ((-2018)) and the United States environmental 16
protection agency's energy star portfolio manager when developing 17
energy use intensity targets; 18
(c) May implement lower energy use intensity targets or 19
alternative metrics for more recently built covered ((commercial)) 20
buildings based on the state energy code in place when the buildings 21
were constructed; 22
(d)(i) Must adopt a conditional compliance method that ensures 23
that covered ((commercial)) buildings that do not meet the specified 24
energy use intensity targets or alternative metrics are taking action 25
to achieve reduction in energy use, including investment criteria for 26
conditional compliance that ensure that energy efficiency measures 27
identified by energy audits are implemented to achieve a covered 28
((commercial)) building's energy use intensity target or alternative 29
metric. The investment criteria must require that a building owner 30
adopt an implementation plan to meet the energy intensity target or 31
alternative metric or implement an optimized bundle of energy 32
efficiency measures that provides maximum energy savings without 33
resulting in a savings-to-investment ratio of less than 1.0, except 34
as exempted in (d)(ii) of this subsection. The implementation plan 35
must be based on an investment grade energy audit and a life-cycle 36
cost analysis that accounts for the period during which a bundle of 37
measures will provide savings. The building owner's cost for 38
implementing energy efficiency measures must reflect net cost, 39
excluding any costs covered by utility or government grants. The 40
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implementation plan may exclude measures that do not pay for 1
themselves over the useful life of the measure and measures excluded 2
under (d)(ii) of this subsection. The implementation plan may include 3
phased implementation such that the building owner is not required to 4
replace a system or equipment before the end of the system or 5
equipment's useful life; 6
(ii) For those buildings or structures that are listed in the 7
state or national register of historic places; designated as a 8
historic property under local or state designation law or survey; 9
certified as a contributing resource with a national register listed 10
or locally designated historic district; or with an opinion or 11
certification that the property is eligible to be listed on the 12
national or state registers of historic places either individually or 13
as a contributing building to a historic district by the state 14
historic preservation officer or the keeper of the national register 15
of historic places, no individual energy efficiency requirement need 16
be met that would compromise the historical integrity of a building 17
or part of a building; 18
(e) Must provide an alternative compliance pathway for an owner 19
of a state campus district energy system, in accordance with RCW 20
19.27A.260, and more broadly for the owner of any campus district 21
energy system that is approved by the department to opt-in in 22
accordance with RCW 19.27A.260(6); 23
(f) Must guarantee that the owner of a state campus district 24
energy system is not required to implement more than one energy 25
management plan and more than one operations and maintenance plan for 26
the campus; 27
(g) Must guarantee that a state campus district energy system, as 28
defined in RCW 19.27A.260, and all buildings connected to a state 29
campus district energy system, are in compliance with any 30
requirements for campus buildings to implement energy efficiency 31
measures identified by an energy audit if: 32
(i) The energy audit demonstrates the energy savings from the 33
state campus district energy system energy efficiency measures will 34
be greater than the energy efficiency measures identified for the 35
campus buildings; and 36
(ii) The state campus district energy system implements the 37
energy efficiency measures; and38
(h) May adopt additional compliance pathways for covered building 39
owners to comply with the standard by meeting alternative metrics.40
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(3) Based on records obtained from each county assessor and other 1
available information sources, the department must create a database 2
of covered ((commercial)) buildings and building owners required to 3
comply with the standard established in accordance with this section.4
(4) By July 1, 2021, the department must provide the owners of 5
covered buildings with notification of compliance requirements.6
(5) The department must develop a method for administering 7
compliance reports from building owners. 8
(6) The department must provide a customer support program to 9
building owners including, but not limited to, outreach and 10
informational material, periodic training, phone and email support, 11
and other technical assistance. 12
(7)(a) The building owner of a covered ((commercial)) building 13
must report the building owner's compliance with the standard to the 14
department in accordance with the schedule established under 15
subsection (8) of this section and every five years thereafter. For 16
each reporting date, the building owner must submit documentation to 17
demonstrate that: 18
(((a))) (i) The weather normalized energy use intensity of the 19
covered ((commercial)) building measured in the previous calendar 20
year is less than or equal to the energy use intensity target or 21
equal to the alternative metric; ((or22
(b))) (ii) The covered ((commercial)) building has received 23
conditional compliance from the department based on energy efficiency 24
actions prescribed by the standard; or 25
(((c))) (iii) The covered ((commercial)) building is exempt from 26
the standard by demonstrating that the building meets one of the 27
following criteria: 28
(((i))) (A) The building did not have a certificate of occupancy 29
or temporary certificate of occupancy for all 12 months of the 30
calendar year prior to the building owner compliance schedule 31
established under subsection (8) of this section; 32
(((ii))) (B) The building did not have an average physical 33
occupancy of at least 50 percent throughout the calendar year prior 34
to the building owner compliance schedule established under 35
subsection (8) of this section; 36
(((iii))) (C) The sum of the building's gross floor area minus 37
unconditioned and semiconditioned spaces, as defined in the 38
Washington state energy code, is less than 50,000 square feet;39
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(((iv))) (D) The primary use of the building is manufacturing or 1
other industrial purposes, as defined under the following use 2
designations of the international building code: (((A))) (I) Factory 3
group F; or (((B))) (II) high hazard group H; 4
(((v))) (E) The building is an agricultural structure; ((or5
(vi))) (F) The building meets at least one of the following 6
conditions of financial hardship: (((A))) (I) The building had 7
arrears of property taxes or water or wastewater charges that 8
resulted in the building's inclusion, within the prior two years, on 9
a city's or county's annual tax lien sale list; (((B))) (II) the 10
building has a court appointed receiver in control of the asset due 11
to financial distress; (((C))) (III) the building is owned by a 12
financial institution through default by a borrower; (((D))) (IV) the 13
building has been acquired by a deed in lieu of foreclosure within 14
the previous 24 months; (((E))) (V) the building has a senior 15
mortgage subject to a notice of default; or (((F))) (VI) other 16
conditions of financial hardship identified by the department by 17
rule; or18
(G) Extenuating conditions exist, as approved by the department 19
prior to the reporting date including, but not limited to, buildings 20
for which meeting the standard would impair national security 21
interests.22
(b) The covered building may apply to the department for an 23
extension to its compliance date. Requests for extension must be 24
received by the department no sooner than six months prior to and up 25
to six months after the applicable compliance date in order to be 26
processed by the department. The department may approve extension 27
requests for conditions including, but not limited to, conditions 28
beyond the control of the building owner. 29
(8) A building owner of a covered ((commercial)) building must 30
meet the following reporting schedule for complying with the standard 31
established under this section: 32
(a) For a building with more than 220,000 gross square feet, June 33
1, 2026; 34
(b) For a building with more than 90,000 gross square feet but 35
less than 220,001 gross square feet, June 1, 2027; and36
(c) For a building with more than 50,000 gross square feet but 37
less than 90,001 square feet, June 1, 2028. 38
(9)(a) The department may issue a notice of violation to a 39
building owner for noncompliance with the requirements of this 40
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section. A determination of noncompliance may be made for any of the 1
following reasons: 2
(i) Failure to submit a compliance report in the form and manner 3
prescribed by the department; 4
(ii) Failure to meet an energy use intensity target or 5
alternative metric, or failure to receive conditional compliance 6
approval; 7
(iii) Failure to provide accurate reporting consistent with the 8
requirements of the standard established under this section; and9
(iv) Failure to provide a valid exemption certificate.10
(b) In order to create consistency with the implementation of the 11
standard and rules adopted under this section, the department must 12
reply and cite the section of law, code, or standard in a notice of 13
violation for noncompliance with the requirements of this section 14
when requested to do so by the building owner or the building owner's 15
agent. 16
(10) The department is authorized to impose an administrative 17
penalty upon a building owner for failing to submit documentation 18
demonstrating compliance with the requirements of this section. The 19
penalty may not exceed an amount equal to $5,000 plus an amount based 20
on the duration of any continuing violation. The additional amount 21
for a continuing violation may not exceed a daily amount equal to $1 22
per year per gross square foot of floor area. The department may by 23
rule increase the maximum penalty rates to adjust for the effects of 24
inflation. 25
(11) Administrative penalties collected under this section must 26
be deposited into the low-income weatherization and structural 27
rehabilitation assistance account created in RCW 70A.35.030.28
(12) The department must adopt rules as necessary to implement 29
this section, including but not limited to: 30
(a) Rules necessary to ensure timely, accurate, and complete 31
reporting of building energy performance for all covered 32
((commercial)) buildings; 33
(b) Rules necessary to enforce the standard established under 34
this section; and 35
(c) Rules that provide a mechanism for appeal of any 36
administrative penalty imposed by the department under this section.37
(13) Upon request by the department, each county assessor must 38
provide property data from existing records to the department as 39
necessary to implement this section. 40
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(14) By January 15, 2022, and each year thereafter through 2029, 1
the department must submit a report to the governor and the 2
appropriate committees of the legislature on the implementation of 3
the state energy performance standard established under this section. 4
The report must include information regarding the adoption of the 5
ANSI/ASHRAE/IES standard 100-2018 as an initial model, the financial 6
impact to building owners required to comply with the standard, the 7
amount of incentives provided under RCW 19.27A.220 and 19.27A.230, 8
and any other significant information associated with the 9
implementation of this section. 10
Sec. 5. RCW 19.27A.220 and 2024 c 85 s 1 are each amended to 11
read as follows: 12
(1) The department must establish a state energy performance 13
standard early adoption incentive program consistent with the 14
requirements of this section. This early adoption incentive program 15
may include incentive payments for early adoption of tier 2 covered 16
building owner requirements as described in subsection (6) of this 17
section. 18
(2) The department must adopt application and reporting 19
requirements for the incentive program. Building energy reporting for 20
the incentive program must be consistent with the energy reporting 21
requirements established under RCW 19.27A.210. 22
(3) Upon receiving documentation demonstrating that a building 23
owner qualifies for an incentive under this section, the department 24
must authorize each applicable entity administering incentive 25
payments, as provided in RCW 19.27A.240, to make an incentive payment 26
to the building owner. When a building is served by more than one 27
entity offering incentives or more than one type of fuel, incentive 28
payments must be proportional to the energy use intensity reduction 29
of each specific fuel provided by each entity for tier 1 buildings. 30
The department may authorize any participating utility, regardless of 31
fuel specific savings, serving a tier 2 building to administer the 32
incentive payment. 33
(4) A covered building owner may receive an incentive payment in 34
the amounts specified in subsection (8)(a) of this section only if 35
the following requirements are met: 36
(a) The building is either: (i) A covered ((commercial)) building 37
subject to the requirements of the standard established under RCW 38
19.27A.210; or (ii) a multifamily residential building where the 39
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floor area exceeds 50,000 gross square feet, excluding the parking 1
garage area; 2
(b) The building's baseline energy use intensity exceeds its 3
applicable energy use intensity target by at least 15 energy use 4
intensity units; 5
(c) At least one electric utility, gas company, or thermal energy 6
company providing or delivering energy to the covered ((commercial)) 7
building or multifamily residential building is participating in the 8
incentive program by administering incentive payments as provided in 9
RCW 19.27A.240; and 10
(d) The building owner complies with any other requirements 11
established by the department. 12
(5) A covered building owner who meets the requirements of 13
subsection (4) of this section may submit an application to the 14
department for an incentive payment in a form and manner prescribed 15
by the department. The application must be submitted in accordance 16
with the following schedule: 17
(a) For a building with more than 220,000 gross square feet, 18
beginning July 1, 2021, through June 1, 2025; 19
(b) For a building with more than 90,000 gross square feet but 20
less than 220,001 gross square feet, beginning July 1, 2021, through 21
June 1, 2026; and 22
(c) For a building with more than 50,000 gross square feet but 23
less than 90,001 gross square feet, beginning July 1, 2021, through 24
June 1, 2027. 25
(6)(a) A tier 2 covered building owner may receive an incentive 26
payment in the amounts specified in subsection (8)(b) of this section 27
only if all required benchmarking, energy management, and operations 28
and maintenance planning documentation as required under RCW 29
19.27A.250 has been submitted to the department and an incentive 30
application has been completed. 31
(b) An eligible tier 2 covered building owner may submit an 32
application beginning July 1, 2025, through June 1, 2030.33
(7) The department must review each application and determine 34
whether the applicant is eligible for the incentive program and if 35
funds are available for the incentive payment within the limitation 36
established in RCW 19.27A.230. If the department certifies an 37
application, it must provide verification to the building owner and 38
each entity participating as provided in RCW 19.27A.240 and providing 39
service to the building owner. 40
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(8)(a) An eligible owner of a tier 1 covered building or an 1
eligible owner of a multifamily residential building greater than 2
50,000 gross square feet, excluding the parking area, that 3
demonstrates early compliance with the applicable energy use 4
intensity target under the standard established under RCW 19.27A.210 5
may receive a base incentive payment of 85 cents per gross square 6
foot of floor area, excluding parking, unconditioned, or 7
semiconditioned spaces. The department may provide incentives greater 8
than the base incentive payment for upgrading tier 1 buildings.9
(b) A tier 2 eligible building owner that demonstrates compliance 10
with the applicable benchmarking, energy management, and operations 11
and maintenance planning requirements may receive a base incentive 12
payment of 30 cents per gross square foot of floor area, excluding 13
parking, unconditioned, or semiconditioned spaces. The department may 14
provide incentives greater than the base incentive payment for 15
upgrading tier 2 buildings. The department may implement a tiered 16
incentive structure for upgrading multifamily buildings to provide an 17
enhanced incentive payment to multifamily building owners willing to 18
commit to antidisplacement provisions. 19
(9) The incentives provided in subsection (8) of this section are 20
subject to the limitations and requirements of this section, 21
including any rules or procedures implementing this section.22
(10) The department must establish requirements for the 23
verification of energy consumption by the building owner and each 24
participating electric utility, gas company, and thermal energy 25
company. 26
(11) The department must provide an administrative process for an 27
eligible building owner to appeal a determination of an incentive 28
eligibility or amount. 29
(12) By September 30, 2025, and every two years thereafter, the 30
department must report to the appropriate committees of the 31
legislature on the results of the incentive program under this 32
section and may provide recommendations to improve the effectiveness 33
of the program. The 2025 report to the legislature must include 34
recommendations for aligning the incentive program established under 35
this section consistent with a goal of reducing greenhouse gas 36
emissions from substitutes, as defined in RCW 70A.60.010.37
(13) The department may adopt rules to implement this section.38
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Sec. 6. RCW 19.27A.250 and 2022 c 177 s 3 are each amended to 1
read as follows: 2
(1)(a) By December 1, 2023, the department must adopt by rule a 3
state energy management and benchmarking requirement for tier 2 4
covered buildings. The department shall include a small business 5
economic impact statement pursuant to chapter 19.85 RCW as part of 6
the rule making. 7
(b) In establishing the requirements under (a) of this 8
subsection, the department must adopt requirements for building owner 9
implementation consistent with the standard established pursuant to 10
RCW 19.27A.210(1) and limited to energy management planning, 11
operations and maintenance planning, and energy use analysis through 12
benchmarking and associated reporting and administrative procedures. 13
Administrative procedures must include exemptions for financial 14
hardship and an appeals process for administrative determinations, 15
including penalties imposed by the department. 16
(c) The department must provide a customer support program to 17
building owners including, but not limited to, outreach and 18
informational materials that connect tier 2 covered building owners 19
to utility resources, periodic training, phone and email support, and 20
other technical assistance. The customer support program must include 21
enhanced technical support, such as benchmarking assistance and 22
assistance in developing energy management and operations and 23
maintenance plans, for tier 2 covered buildings whose owners 24
typically do not employ dedicated building managers including, but 25
not limited to, multifamily housing, child care facilities, and 26
houses of worship. The department shall prioritize underresourced 27
buildings with a high energy use per square foot, buildings in rural 28
communities, buildings whose tenants are primarily small businesses, 29
and buildings located in high-risk communities according to the 30
department of health's environmental health disparities map.31
(d)(i) The department may adopt rules related to the imposition 32
of an administrative penalty not to exceed 30 cents per square foot 33
upon a tier 2 covered building owner for failing to submit 34
documentation demonstrating compliance with the requirements of this 35
subsection. 36
(ii) Administrative penalties collected under this section must 37
be deposited into the low-income weatherization and structural 38
rehabilitation assistance account created in RCW 70A.35.030 and 39
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reinvested into the program, where feasible, to support compliance 1
with the standard. 2
(2) By July 1, 2025, the department must provide the owners of 3
tier 2 covered buildings with notification of the requirements the 4
department has adopted pursuant to this section that apply to tier 2 5
covered buildings. 6
(3) The owner of a tier 2 covered building must report the 7
building owner's compliance with the requirements adopted by the 8
department to the department in accordance with the schedule 9
established under subsection (4) of this section and every five years 10
thereafter. For each reporting date, the building owner must submit 11
documentation to demonstrate that the building owner has developed 12
and implemented the procedures adopted by the department by rule, 13
limited to energy management planning, operations and maintenance 14
planning, and energy use analysis through benchmarking.15
(4) By July 1, 2027, tier 2 covered building owners must submit 16
reports to the department as required by the rules adopted in 17
subsection (1) of this section. 18
(5)(a) By July 1, 2029, the department must evaluate benchmarking 19
data to determine energy use and greenhouse gas emissions averages by 20
tier 2 covered building type. 21
(b) The department must submit a report to the legislature and 22
the governor by October 1, 2029, with recommendations for cost-23
effective building performance standards for tier 2 covered 24
buildings. The report must contain information on estimated costs to 25
building owners to implement the performance standards and 26
anticipated implementation challenges. 27
(c)(i) By December 31, 2030, the department must adopt rules for 28
performance standards for tier 2 covered buildings.29
(ii) In adopting these performance standards, the department must 30
consider the age of the building in setting energy use intensity 31
targets or alternative metrics. 32
(iii) The department may adopt performance standards for 33
multifamily residential buildings on a longer timeline schedule than 34
for other tier 2 covered buildings. 35
(iv) The rules may not take effect before the end of the 2031 36
regular legislative session. 37
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(v) The department must include a small business economic impact 1
statement pursuant to chapter 19.85 RCW as part of the rule making.2
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p. 19 SB 5514