How Local Law 33 Impacts Building Energy Efficiency


In a city that never sleeps, energy consumption never stops. New York City’s skyline glows bright, but behind that glow lies a challenge: buildings are responsible for a large percentage of the city’s total energy use and carbon emissions. Recognizing this, New York City enacted Local Law 33 (LL33)—a transformative piece of legislation designed to increase transparency, encourage energy efficiency, and hold building owners accountable for their environmental impact.
This law doesn’t just mandate compliance—it aims to change how New Yorkers view building performance, helping the city move toward a greener, more energy-efficient future.

Understanding Local Law 33
Local Law 33 of 2018 is part of New York City’s Greener, Greater Buildings Plan, which includes several related laws such as Local Law 84 (benchmarking), Local Law 87 (energy audits and retro-commissioning), and Local Law 97 (carbon emissions limits).
The primary goal of LL33 is to make energy performance transparent by requiring large buildings to display an energy efficiency grade—similar to a restaurant sanitation grade—at public entrances. The law helps tenants, buyers, and the public see how efficiently a building operates and encourages owners to make improvements.
Essentially, LL33 turns energy efficiency into a public performance metric.

Who Must Comply with Local Law 33
LL33 applies to what the city defines as “covered buildings.” These include:
Buildings 25,000 square feet or larger.


Multiple buildings on a single lot that together exceed 100,000 square feet.


Condominium or cooperative properties where combined square footage exceeds 100,000 square feet.


Certain facilities—like religious institutions, industrial plants, or properties that cannot be rated by the ENERGY STAR system—may be exempt. However, for most large residential, commercial, and mixed-use buildings, compliance is mandatory.

How the Grading System Works
At the core of LL33 is the building energy efficiency grade—a visible letter grade posted at the building entrance each year. Here’s how it works:
Annual Benchmarking
Building owners must annually measure and report their property’s energy and water usage through the ENERGY STAR Portfolio Manager. This data submission is required under Local Law 84.


ENERGY STAR Score Calculation
The submitted data generates a 1-to-100 ENERGY STAR score that compares the building’s energy performance to similar properties nationwide.


Letter Grade Assignment
Based on the ENERGY STAR score, a letter grade is assigned:


A: 85 or higher


B: 70–84


C: 55–69


D: Below 55


F: Failure to submit benchmarking data


N: Not eligible for a score


Public Posting Requirement
Every October, building owners receive their Building Energy Efficiency Rating Label from the Department of Buildings (DOB). The label must be printed and prominently displayed near a public entrance no later than October 31 each year.


Non-compliance—such as failing to post the label—can lead to fines of up to $1,250 per year.

The Purpose Behind Local Law 33
LL33 is more than a reporting requirement—it’s a behavior-changing tool. The law is built around three core goals:
Transparency:
By publicly displaying grades, the law makes building performance visible to tenants, buyers, and the public. Poorly performing buildings can no longer hide behind closed doors.


Accountability:
Owners are held responsible for their building’s efficiency. A low grade reflects inefficiency, prompting corrective action.


Motivation for Improvement:
Because grades are public, market pressure motivates owners to upgrade systems, reduce energy waste, and enhance operational efficiency.


Why Energy Efficiency Matters for Buildings
Buildings are among the largest energy consumers in New York City. Heating, cooling, lighting, and water systems account for massive amounts of energy use and greenhouse gas emissions. Improving building efficiency:
Reduces operational costs


Improves occupant comfort


Increases property value


Supports citywide sustainability goals


Local Law 33 plays a crucial role by aligning private building performance with public climate objectives.

How LL33 Encourages Better Building Performance
1. Promotes Competition Through Transparency
When energy grades are visible, buildings naturally compete to earn higher scores. This “friendly competition” drives investment in energy-saving technologies such as LED lighting, efficient HVAC systems, and smart controls.
2. Incentivizes Retrofit Projects
Many owners take LL33 as an opportunity to conduct energy audits and identify areas for improvement. Upgrading insulation, modernizing building systems, or installing renewable energy sources can raise scores and lower costs over time.
3. Enhances Market Value
High-performing buildings can advertise their “A” or “B” grade as a sign of sustainability and reduced operating costs. Tenants seeking environmentally responsible spaces are more likely to choose them, boosting rental and resale value.
4. Supports Local Law 97 Compliance
LL33 works in harmony with Local Law 97, which imposes carbon emissions limits. By improving energy efficiency now, building owners reduce their risk of future penalties under LL97.

Steps to Comply with Local Law 33
To stay compliant and maximize the benefits of LL33, property owners should follow these steps:
Check if Your Building is Covered
Verify if your property meets the square footage criteria and falls under the benchmarking requirement.


Collect Accurate Data
Track energy and water use for the previous calendar year using the ENERGY STAR Portfolio Manager.


Submit Benchmarking Data on Time
Ensure data is submitted by the May 1 deadline every year. Missing the deadline results in an automatic “F” grade.


Download the Official Energy Label
Once issued by the DOB, print the label and display it prominently.


Analyze Your Grade
Review your ENERGY STAR score to understand your performance compared to similar buildings. Identify where you can improve.


Implement Energy-Saving Upgrades


Replace outdated lighting with LED systems.


Tune up HVAC systems and add smart thermostats.


Improve insulation and window efficiency.


Install variable-frequency drives (VFDs) for motors.


Educate tenants on reducing energy waste.


Monitor Progress Year-Round
Continue tracking consumption and efficiency measures. Consistent improvement will help raise your grade over time.


Benefits of Local Law 33 for Building Owners
Reduced Operating Costs
Energy-efficient systems reduce electricity, gas, and water bills significantly.


Higher Property Value
Buildings with higher grades are often viewed as premium properties, commanding higher rents and resale prices.


Improved Tenant Satisfaction
Efficient buildings offer better comfort, indoor air quality, and reliability—factors that retain tenants longer.


Regulatory Compliance
Staying compliant avoids penalties and positions owners favorably for upcoming regulations such as Local Law 97.


Positive Public Image
A visible “A” or “B” grade reflects commitment to sustainability, which strengthens brand reputation.


Challenges Building Owners May Face
While LL33 provides long-term benefits, implementation can pose some challenges:
Older Building Infrastructure
Historic or outdated structures may require major upgrades to improve efficiency.


Upfront Costs
Efficiency projects like HVAC modernization or façade improvements involve capital investment. However, financing options and incentives are often available to offset costs.


Complex Data Management
Gathering and submitting accurate benchmarking data demands technical understanding and time.


Continuous Monitoring
Maintaining a high grade means treating energy efficiency as an ongoing effort, not a one-time project.


Despite these challenges, the long-term payback—in savings, reputation, and compliance—makes the effort worthwhile.

Impact on Tenants and the Market
Local Law 33 doesn’t just affect property owners—it also empowers tenants, buyers, and the real-estate market as a whole.
Tenants can make informed decisions by comparing buildings based on energy performance before signing leases.


Investors gain visibility into a building’s operational efficiency, helping them assess long-term value and risk.


The Real-Estate Market shifts toward sustainable development, as energy-efficient buildings become more desirable.


This transparency creates a feedback loop: as demand for high-grade buildings increases, more owners invest in upgrades to stay competitive.

Improving Your Building’s Energy Grade: Practical Tips
Conduct a Professional Energy Audit
Identify inefficiencies in HVAC systems, lighting, and insulation.


Use Smart Building Technology
Automated controls and smart sensors optimize energy use in real time.


Upgrade to Energy-Efficient Equipment
Replace old boilers, chillers, and lighting systems with high-efficiency alternatives.


Engage Occupants in Energy Awareness Programs
Encourage tenants to adopt energy-saving behaviors—turning off lights, managing thermostat settings, and reducing water waste.


Track Energy Data Monthly
Regular monitoring helps catch anomalies early and ensures steady progress toward efficiency goals.


Leverage Financial Incentives
Use available city or state programs that provide rebates or low-interest financing for energy upgrades.


Plan for the Long Term
Align LL33 improvements with future compliance needs, such as emissions limits under Local Law 97.



Broader Environmental and Economic Impacts
LL33 contributes significantly to New York City’s climate action strategy by encouraging large-scale energy reductions across the building sector. Over time, this leads to:
Lower greenhouse gas emissions


Reduced strain on the city’s power grid


Improved air quality


Creation of green jobs in construction, engineering, and maintenance


By turning energy performance into a matter of public record, LL33 empowers everyone—from policymakers to everyday tenants—to take part in creating a sustainable city.

Conclusion
Local Law 33 represents a pivotal shift in how New York City approaches building energy performance. By making energy grades public, the law promotes transparency, accountability, and a collective drive toward efficiency.For building owners, LL33 is both a compliance requirement and a business opportunity. Improving your building’s energy grade can lower operational costs, enhance property value, attract environmentally conscious tenants, and prepare you for future emissions regulations. For tenants and the public, the law offers valuable insight into a building’s environmental responsibility and operational performance.