State Energy Performance Standard.  In 2019, the Legislature enacted the Clean Buildings Act, which required the Department of Commerce (Commerce) to establish by rule a State Energy Performance Standard (Standard). The Standard seeks to maximize reductions in greenhouse gas emissions from the building sector.  The Standard includes energy use intensity targets by building type, and methods of conditional compliance that include an energy management plan, operations and maintenance program, energy efficiency audits, and investments in energy efficiency measures designed to meet the targets.
 

Tier 1 Buildings. Tier 1 covered buildings, also referred to as covered commercial buildings, must comply with the Standard. Tier 1 buildings include existing buildings where the sum of nonresidential, hotel, motel, and dormitory floor areas exceeds 50,000 gross square feet, excluding the parking garage area.

Compliance with the Standard, and reporting for Tier 1 buildings is tiered, and begins June 2026 for buildings greater than 220,000 square feet. 

Tier 2 Buildings. In 2022, the Legislature expanded the Clean Buildings Act to include Tier 2 covered buildings, which include multifamily residential, nonresidential, hotel, motel, and dormitory floor areas that are greater than 20,000 square feet and less than 50,000 square feet, excluding the parking garage area. Tier 2 buildings also include multifamily residential buildings where the floor areas are equal to or greater than 50,000 square feet, excluding the parking garage area. 

The 2022 law requires all Tier 2 buildings to report on benchmarking, implementation of energy management plans, and operations and maintenance programs. Commerce must complete rulemaking for Tier 2 buildings by December 2023. Reporting for Tier 2 buildings begins by July 1, 2027. 

 
Early Adopter Incentive Program.  The Standard includes an early adopter incentive program for Tier 1 building owners who comply with the Standard, or Tier 2 building owners that demonstrate compliance with benchmarking, energy management, and operations and maintenance planning requirements. 

Tier 1 or multifamily building owners can receive a base incentive payment of $0.85 per gross square foot of floor area. Tier 2 building owners can receive a base incentive rate of $0.30 per gross square feet of floor area. Incentive payments exclude parking, unconditioned, or semiconditioned spaces.  Commerce may not approve incentive payments that exceed a total of $75 million for Tier 1, or exceed a total of $150 million for Tier 2. 

Reporting. Beginning January 15, 2022, and each year thereafter through 2029, Commerce must submit a report to the Governor and Legislature on the implementation of the Standard. The report must also include the financial impact to building owners required to comply and the amount of incentives provided. 

The bill as referred to committee not considered.

Two-Year Delay. The Tier 1 buildings reporting schedule for complying with the Standard is delayed two years. Buildings with more than: 

• 220,000 gross square feet must report June 1, 2028; 
• 90,000 gross square feet, but less than 220,001 gross square feet, must report June 1, 2029; and
• 50,000 gross square feet, but less than 90,001 square feet, must report June 1, 2030. 

All Tier 2 buildings rulemaking and reporting requirements are delayed by two years. The following are the new dates:

• Commerce must adopt by rule a state energy management, and benchmarking requirement by December 1, 2025; 
• Commerce must notify Tier 2 building owners with the requirements by July 1, 2027;
• Tier 2 building owners must submit reports with their compliance plans to Commerce by July 1, 2029; 
• Commerce must evaluate benchmarking data to determine energy use, and greenhouse gas emissions averages by building type by July 1, 2031;
• Commerce must submit a report to the Legislature and the Governor with recommendations for cost effective building performance standards for Tier 2 buildings by October 1, 2031; and 

• Commerce must adopt rules to include Tier 2 covered buildings in the Standard by December 31, 2032, but the rules may not take effect before the conclusion of the 2033 legislative session.

Work Group. Subject to amounts appropriated, the Washington State University Energy Program must convene a work group, with assistance from the State Energy Office, to:

• report, by December 15, 2023, on the financial impacts to state-owned buildings, public K-12 school buildings, and public buildings of institutions of higher education required to comply with the Standard; and
• make certain recommendations to the Legislature, by September 1, 2024, regarding energy efficiency in the building sector, including identifying investments, strategies, or timelines for increasing energy efficiency, a cost-benefit analysis of options, and any statutory changes.

The work group, at a minimum, must consist of one representative from each public four-year institution of education, the State Board for Community and Technical Colleges, the Office of the Superintendent of Public Instruction, the Department of Social and Health Services, the Department of Corrections, and the Department of Enterprise Services, and two representatives from a national association for industrial and office parks.