Lakewood staff propose energy-benchmarking rule for buildings 10,000+ sq ft; DOE grant status clouds timeline

Lakewood City staff presented a proposed energy benchmarking policy March 3 that would require multifamily and nonresidential buildings of 10,000 square feet or larger to submit annual energy-use reports, a step staff says could inform later building performance standards to reduce greenhouse gas emissions.

Jeff Wong, with the Community Sustainability, Climate and Zero Waste Division, told the City Council the proposal would apply to buildings that share central systems (multifamily) and to commercial, public and manufacturing buildings. "We're proposing a benchmarking policy that would apply to all multifamily and nonresidential buildings that are 10,000 square feet and greater in gross floor area," Wong said. He said about 830 Lakewood buildings meet that threshold and that those structures account for nearly 50% of the city's building-sector emissions.

The proposal is the first phase of a two-part approach: benchmarking to collect baseline energy data, followed by a building performance standard (BPS) that would set long-term energy or emissions targets for large buildings. Wong said benchmarking typically covers a 12-month reporting period and can reduce energy use simply by making owners more aware of consumption; staff estimate an average per-building savings of about $1,100 annually for a 10,000-square-foot property and an aggregate potential annual utility-bill savings of roughly $4.5 million across covered Lakewood buildings.

Why it matters

City staff say buildings account for roughly 42% of Lakewood's community greenhouse gas emissions and that a benchmarking program would provide the data needed to design targeted emissions reductions. "Once we have that information, we can dive deeper into each individual building and identify which components use the most energy," Wong said, describing how benchmarking would feed a future performance standard.

Key details of the proposed policy

- Scope: Multifamily and nonresidential buildings 10,000 square feet and larger; federal buildings excluded. Wong noted Colorado already requires benchmarking for buildings 50,000 square feet and larger and that buildings meeting the state threshold would report to the state and Lakewood but be subject to state enforcement.

- Reporting schedule: Annual benchmarking data due June 1 for the prior calendar year, aligned with the state's reporting date.

- Compliance and penalties: Staff propose no reporting fee. Failure to file or obtain an approved waiver by June 1 would be a violation; property owners would have 90 days to cure in the program's first year and 30 days in subsequent years before a civil penalty of $2,000 per violation, a level Wong said mirrors state and City of Denver penalties.

- Exemptions/waivers: City staff would accept waiver requests for buildings with limited occupancy or no certificate of occupancy, projects under renovation for more than one year, demolition-permitted properties, owners proving financial hardship, and certain manufacturing/industrial buildings that show an existing energy-efficiency plan.

Costs, staffing and timeline

Wong said staff estimate the benchmarking phase would cost about $300,000–$350,000 in its first year (including one FTE or contracted equivalent and third-party consultant support), with somewhat lower recurring costs thereafter. He said the city already benchmarks its four buildings of 50,000 square feet and above to meet state rules and that setting up a single building account typically takes one to two hours, with only a few minutes of annual maintenance.

The City sought a $5,000,000 Department of Energy (DOE) award last year to support both benchmarking and a subsequent building performance standard; Wong said the grant would cover program development, implementation and included workforce development investments. "The grant was intended to cover not only benchmarking, but the development of a building performance standard program afterward," he said. However, staff told council the award's status is uncertain because of recent federal executive orders and pending court challenges. If DOE funds are released by May, staff said they would bring an ordinance to council in the spring, finish administrative rules and the reporting portal during 2024, and expect the first municipal reporting deadline to be June 1, 2026. Wong cautioned the timeline may change if the grant is not available.

Data quality, mapping and enforcement

Council members pressed staff on data validation and enforcement. Wong said data checks would use the EPA Energy Star Portfolio Manager's built-in validations and additional automated flags and staff review to detect outliers. He also described plans for a public, map-based display of benchmarking results similar to other U.S. jurisdictions, enabling transparency about compliance and performance.

Equity, workforce and incentives

Council members raised equity concerns for older and affordable multifamily housing. Wong said the city's DOE grant proposal included funding for an "equity priority building" program intended to offer resources and incentives to offset improvement costs and that staff intend to design BPS rules with affordability in mind. He also said the grant proposal earmarked funds for workforce development partnerships, including training at Red Rocks Community College, anticipating increased demand for skilled workers to perform building retrofits.

Relationship with utilities and rebates

Wong and councilors discussed coordination with Xcel Energy programs. Wong said Xcel's recent Clean Heat Plan provides business rebates, some of which apply to municipal buildings, and that the city has run a small-business LED retrofit program in partnership with Xcel that is resuming this year.

Council reaction and next steps

Councilors generally praised the presentation and asked staff to continue refining details around validation, exemptions and equity. Councilor Matt Guerrero said the project is "something that's been asked for for a while" and urged attention to data integrity; Councilor Anne Sinks asked whether benchmarking paired with a BPS could be among the city's most impactful greenhouse-gas policies. Staff said council leadership would track the DOE grant and consider the proposal as part of the city's upcoming budget and planning cycle if federal funds remain uncertain.

Limitations and outstanding items

No ordinance or vote occurred at the March 3 study session. Several program details remain to be finalized in the administrative rules staff would draft following any ordinance: the exact waiver-review process, the city contact list for covered buildings, mapping and public-data presentation specifics, and precise allocations within the DOE grant (should funds be released). Wong said staff will continue stakeholder engagement and will bring a proposed ordinance to council if the funding and internal plans allow.

Ending

City staff sought feedback at the March 3 study session and indicated they would return to council with an ordinance for consideration if grant funding materializes or if council elects to prioritize local funding through the city's budget process.