State climate law has changed. How will that affect New York City buildings?

When it was passed in 2019, New York state’s climate law was consid­ered the most ambi­tious in the country. The Climate Leadership and Community Protection Act (CLCPA) set land­mark carbon emis­sion targets for the state’s elec­trical grid, with a goal of net zero by 2040. 

Heavy air pollu­tion was to be cut down to 85 percent of 1990 levels by 2050, and at least a third of all funding for these changes had to go to under­served commu­ni­ties, defined by a criteria of demo­graphics and past invest­ments, or lack thereof. The first dead­line was 2024, by which point the state had to issue regu­la­tions — or a road map — to get there.

But that dead­line came and went. And so when a state supreme court judge ordered Governor Kathy Hochul’s office to either comply or pursue a change in the law, her admin­is­tra­tion did the latter. Lawmakers followed suit: for the first time since the CLCPA’s passage, lawmakers in Albany made signif­i­cant roll­backs to the measure in May as part of state budget negotiations.

Hochul, who had been lobbying for a change to the law since earlier in the legisla­tive session, insisted that it came down to a ques­tion of costs. ​“For us to meet the goals on the time frame that was set by the legis­la­ture, there’s going to be enor­mous costs to fami­lies. Enormous,” she said to reporters in March. ​“I just need a reality check.”

The changes made in this year’s budget pushed CLCPA’s dead­lines further out. Now, the admin­is­tra­tion has until the end of 2028 to come up with a plan. The net-zero goal for 2050 has stayed the same, but the 2030 interim target has been pushed to 2040, and with a lighter mandate of a 60 percent decrease in emis­sions. And even that comes with caveats. 

Ken Lovett, Hochul’s senior commu­ni­ca­tions advisor on energy and envi­ron­ment said in a state­ment to Skylight: ​“Governor Hochul has made clear her top priority is keeping the lights on and costs down for all New Yorkers.” He empha­sized that the changes in this year’s budget ​“protect New York’s status as a climate leader, while prior­i­tizing afford­ability for New Yorkers.”

The changes to this law arrive amidst a larger back­sliding on climate goals in New York, the U.S. at large, and abroad, due to shifting economics and polit­ical back­lash. In turn, they raise reason­able doubt about the effi­cacy of other inter­locking climate poli­cies. And in New York City, the key policy to watch is Local Law 97 (LL97).

We asked experts if the state’s new climate reality will trickle down to hinder the U.S.’s largest city and its most substan­tial effort to reduce building emis­sions, which was enacted around the same time as a comple­ment to the CLCPA. 

The top-line answer: not directly, as the city has sepa­rate systems and rules in place to see through LL97. But the shifting land­scape at the state level could make certain aspects of its imple­men­ta­tion trickier across the five boroughs.

Here are three areas to watch for:

Uncertain long-term funding

In 2023, CLCPA was catalyzed with a commit­ment by Hochul to enact ​“cap and invest,” a regu­la­tory model where polluters pay penalty fees for emis­sion beyond a specific threshold — money that the state would then use to fund several cate­gories of projects, including rebates, invest­ments in under­served commu­ni­ties, and clean energy infra­struc­ture. ​“Cap and invest” was, in other words, intended to be the finan­cial vehicle to pay for many of the goals of CLCPA. But two years later, the governor backed away from its rollout, which led envi­ron­mental groups to sue. And now, with the changes to CLCPA, the future of that funding model appears uncertain.

“The state was under a court order that, in effect, directed it to start cap and invest, as I see it,” said Pete Sikora, a climate orga­nizer with New York Communities for Change. ​“Now it isn’t.”

For building owners in New York City, that could have conse­quences. According to Dale Bryk, an energy expert at Harvard University and the Regional Plan Association, the projects that would be poten­tially funded by the cap and invest scheme could help subsi­dize the tran­si­tion to renew­able energy.

“The failure to advance a cap and invest program means we don’t have a long-term stream of funds to invest in clean energy solu­tions that lower energy bills and improve quality of life, including energy effi­ciency and elec­tri­fi­ca­tion measures that enable building owners to comply with LL97,” said Bryk, who serves on the board of New York State Energy Research and Development Authority (NYSERDA), which would play a key role. ​“The state and city can work together to find other means of supporting these bene­fi­cial invest­ments but cap and invest is the long-term solution.”

Delays to cleaning up the grid

The enforce­ment of LL97 rests on what are known as green­house gas ​“coef­fi­cients,” which are metrics used to calcu­late a building’s carbon foot­print from its energy use. (If a building exceeds a certain amount of carbon emis­sions, it has to pay fines.) Those coef­fi­cients have been deter­mined up to 2035, factoring in assump­tions about the elec­trical grid progres­sively getting cleaner. But with the state’s delay, what happens after 2035 is being discussed amongst experts and practitioners.

“Some have been asking, ​‘If the state is delayed on cleaning the grid, does that mean LL97’s coef­fi­cients will be auto­mat­i­cally adjusted?’” said Chris Halfnight, CEO of the Urban Green Council, which advises on building decar­boniza­tion. ​“The answer is, these two things are sepa­rate levers.”

Coefficients, updated in five-year incre­ments, are deter­mined by the city’s Department of Buildings (DOB), with input from an advi­sory board which includes repre­sen­ta­tives from the real estate commu­nity. So what the city will decide to do next remains to be seen. ​“The devel­op­ments on the state side will inform the thinking for how [the city] sets the coef­fi­cient,” said Halfnight. ​“But how that’s going to go — that’s quite a few years away at this point.”

As far as building compli­ance goes, the DOB, which over­sees LL97 imple­men­ta­tion, has its own mech­a­nisms in place for prop­erty owners to comply. That includes a flex­ible option, where build­ings can ​“buy time” by paying into an inno­v­a­tive fund that goes towards heat pumps in afford­able housing, Bryk said. And so far, they’ve been successful: over 90 percent of build­ings are on track to meet the 2030 targets. 

Confusion over compliance messaging 

The CLCPA is a state law that affects state-regu­lated issues and systems. Local Law 97 is a city law, enforced entirely by city agen­cies. But in prac­tice, those lines quickly get blurred. 

Conflating the juris­dic­tions between Albany and City Hall is a peren­nial issue amongst polit­ical observers, let alone the public. And any law’s changes could make those distinc­tions even more diffi­cult. ​“Some building owners will think LL97 is delayed because they confuse the CLCPA and LL97,” said Sikora.

It’ll take time, experts agree, for aware­ness to catch up. But what shouldn’t be lost in the messaging, they said, is decarbonization’s poten­tial. Case in point: earlier this year, Urban Green Council released an analysis that showed how many emis­sions heat pumps could save building owners, regard­less of the grid’s still-heavy reliance on fossil fuels.

“That math doesn’t change based on shifts in the CLCPA’s interim targets,” said Halfnight. ​“It’s because heat pumps are so efficient.”

Even as improved tech­nology pushes New York City towards more effi­cient heating and cooling, progress towards complete carbon neutrality depends on effec­tive regu­la­tion at the state level — to crack down on polluters, fund renew­able energy, and clean up the elec­trical grid.