Washington State’s Clean Buildings Act: Essential guide to compliance and benefits

November 29, 2024

As part of Washington State’s commitment to a sustainable future, the Clean Buildings Act introduces new standards for energy efficiency in buildings across the state. The Act establishes mandatory energy performance requirements for commercial properties and aims to reduce greenhouse gas emissions in line with Washington’s climate goals. This guide provides a comprehensive overview of the Clean Buildings Act, what it means for building owners, and how it’s shaping Washington’s path to a low-carbon future.

What is Washington’s Clean Buildings Act?

The Clean Buildings Act (Clean Buildings Performance Standard), signed into law in 2019, requires large commercial buildings in Washington State to meet specific energy efficiency standards. Administered by the Washington State Department of Commerce, the Act is designed to help reduce greenhouse gas emissions from one of the state’s most energy-intensive sectors: commercial and multifamily buildings.

Why Was the Clean Buildings Act Established?

Buildings are responsible for about 27% of Washington State’s total greenhouse gas emissions, primarily due to heating, cooling, and lighting needs. The Clean Buildings Act was created to address these emissions, which must be reduced to meet Washington’s target of a 95% reduction in greenhouse gas emissions by 2050.

By mandating energy efficiency improvements, the Act creates long-term economic, environmental, and public health benefits. Building owners who meet the Act’s standards not only help Washington reach its climate goals but can also expect lower energy bills, reduced maintenance costs, and improved property values over time.

Key objectives of the Act‍

The Clean Buildings Act has two primary objectives: improve building energy efficiency and reduce overall emissions across Washington. The Act’s long-term goal is to encourage a significant reduction in the energy intensity of large buildings, creating a pathway to carbon neutrality for Washington’s building sector by 2050.

By prioritizing building efficiency, the Clean Buildings Act supports the state’s broader climate action targets and aims to set a precedent for sustainability in the region.

Recent updates

Washington State's Clean Buildings Act has undergone significant updates to enhance energy efficiency and reduce greenhouse gas emissions from existing buildings. The primary amendments include:

Expansion of covered buildings:

2022 Amendment: The Act was expanded to include smaller buildings. Originally, it applied to commercial buildings larger than 50,000 square feet (Tier 1). The 2022 amendment introduced Tier 2, encompassing buildings between 20,000 and 50,000 square feet, including multifamily residential buildings over 20,000 square feet.

Introduction of incentive programs:

Early Adopter Incentive Program: To encourage prompt compliance, the state offers financial incentives to building owners who meet the performance standards ahead of mandated deadlines. For Tier 1 buildings, the incentive is $0.85 per square foot. For Tier 2 buildings, an incentive of $0.30 per square foot is available, with a total of $150 million earmarked for this purpose.
2024 Enhancement: Legislation passed in 2024 authorizes the Department of Commerce to increase these incentive payments, aiming to boost participation in early compliance.

Inclusion of campus district energy systems:

2023 Update: The Act was augmented to incorporate decarbonization requirements for campus district energy systems. This addition updates existing rules to further reduce emissions from centralized energy systems serving multiple buildings.

Who is affected by the Clean Buildings Act?

The Clean Buildings Act currently applies to large commercial buildings in Washington, with a phased approach based on building size:

Tier 1 (Buildings 50,000 sq. ft. or more): The Act initially focuses on buildings 50,000 square feet or larger. Compliance deadlines for these properties are set for the next few years.
Tier 2: The Act is expected to expand to include smaller buildings over 20,000 square feet and will set more stringent efficiency requirements over time.

Certain building types are exempt from the Act, including manufacturing facilities and structures that use energy primarily for industrial processes.

How does compliance with the Clean Buildings Act work?

Compliance with the Clean Buildings Act involves meeting specific energy performance standards. These standards are based on a building’s Energy Use Intensity (EUI), which measures energy use per square foot. The Act offers flexibility in how building owners can meet their targets, but all pathways ultimately aim to reduce the building’s EUI to the required level.

Steps to achieve compliance‍

Here’s a breakdown of the steps building owners must follow to ensure they meet the Clean Buildings Act requirements:

Benchmark energy usage
The first step is to measure and benchmark energy usage, typically through tools like ENERGY STAR Portfolio Manager. Benchmarking provides a baseline that shows where a building stands and identifies areas with the greatest potential for improvement.
Assess the EUI Target
Each building is assigned a specific EUI target based on its size and type. Buildings must meet these targets by the compliance deadlines set by the Department of Commerce, with required improvements based on the current EUI of the property.
Implement energy efficiency improvements
Once the EUI target is established, building owners must implement the necessary upgrades. Common improvements include HVAC system upgrades, lighting retrofits, building envelope improvements, and insulation enhancements.
Submit a compliance report
Building owners must submit a compliance report to the Department of Commerce, detailing the upgrades and demonstrating that the building meets its EUI target. This report must be updated every five years to ensure ongoing compliance with the Act’s evolving standards.
Alternative compliance options
Buildings that face challenges in achieving the specified EUI targets can work with the Department of Commerce to establish an alternative compliance path. This option provides flexibility for properties with unique constraints.

Compliance deadlines:

Tier 1 Buildings: Compliance deadlines are staggered based on building size:

Buildings over 220,000 square feet: June 1, 2026
Buildings between 90,000 and 220,000 square feet: June 1, 2027
Buildings between 50,000 and 90,000 square feet: June 1, 2028

Tier 2 Buildings: All covered buildings, including multifamily residential buildings over 20,000 square feet, must comply by July 1, 2027.

Penalties for non-compliance with the Clean Buildings Act

Non-compliance with Washington State's Clean Buildings Act results in substantial penalties for building owners. The penalties differ based on the building's classification:

Tier 1 Buildings (Commercial buildings over 50,000 square feet):

Penalty Structure: Owners face a base fine of up to $5,000, plus an additional daily penalty calculated at $1.00 per gross square foot per year. This daily penalty accrues over time, with a maximum accumulation period of 18 months.

Tier 2 Buildings (Commercial buildings between 20,000 and 50,000 square feet, including multifamily residential buildings over 20,000 square feet):

Penalty Structure: For non-compliance, owners are subject to a flat fee of $0.30 per gross square foot. Unlike Tier 1, this penalty is not prorated based on the duration of non-compliance but is applied as a one-time fee per compliance cycle.

How to prepare for Clean Buildings Act compliance

Compliance with the Clean Buildings Act requires planning, evaluation, and investment in energy-efficient solutions. Here are some steps to prepare:

Conduct an energy auditStart with a professional energy audit to identify areas of improvement. An audit can pinpoint systems and practices that consume the most energy and suggest targeted improvements.
Create an efficiency plan
Based on the audit’s findings, develop a comprehensive efficiency plan. This should include budget estimates, timelines, and specific actions, such as replacing HVAC systems, installing energy-efficient lighting, and improving insulation.
Leverage available financial incentives
Washington offers several incentives and rebate programs to support energy efficiency projects. From state grants to utility company rebates, there are options to help reduce the cost of necessary upgrades and encourage compliance with the Act.
Monitor and document progress
Regular monitoring and documentation are key to maintaining compliance. Using tools like ENERGY STAR Portfolio Manager allows building owners to track improvements, document energy savings, and prepare for future compliance reporting.
Stay informed on regulation updates
The Clean Buildings Act is expected to introduce new standards and compliance phases. Staying informed ensures that building owners can plan for upcoming changes and maintain compliance over time.

Benefits of the Clean Buildings Act compliance for commercial building owners

Reduced operational costs‍

Energy efficiency improvements lead to lower utility bills and operational costs. By reducing energy demand, building owners can benefit from significant long-term savings.

Improved market value and tenant appeal

‍Properties that comply with the Clean Buildings Act demonstrate a commitment to sustainability, which can increase appeal to environmentally conscious tenants and buyers. Compliance can also increase property values, as energy-efficient buildings are often more attractive in the market.

Positive environmental impact‍

The Act allows building owners to make a meaningful contribution to Washington’s climate goals. By reducing emissions, the state can work towards its target of carbon neutrality, and building owners play an essential role in this effort.

Healthier indoor environments

‍Energy efficiency often results in improved indoor air quality and more comfortable living and working conditions. This can enhance tenant satisfaction, reduce complaints, and increase occupancy rates.

How building analytics software can support compliance with the Clean Buildings Act

Building analytics software is a powerful tool for meeting the requirements of Washington’s Clean Buildings Act by providing real-time insights and actionable recommendations to improve energy performance. By continuously monitoring energy use, the software identifies inefficiencies and underperforming equipment, enabling building owners to prioritize upgrades that align with compliance standards. It also streamlines reporting processes by automatically collecting data and generating compliance-ready reports, saving time and ensuring accuracy.

Additionally, advanced features like fault detection and diagnostics (FDD) help reduce energy waste by quickly identifying and addressing anomalies in systems such as HVAC and lighting. Predictive maintenance capabilities further ensure that equipment operates efficiently, minimizing downtime and energy costs. For building owners aiming to qualify for the Act's Early Adopter Incentive Program, analytics platforms can accelerate energy improvements and demonstrate compliance well ahead of deadlines, unlocking financial rewards and long-term cost savings.

By leveraging building analytics software, property owners not only achieve compliance with the Clean Buildings Act but also enhance operational efficiency and sustainability, while reducing penalties and operational costs. This makes the software an essential tool for meeting regulatory requirements and improving building performance over the long term.