Montgomery County Council reviews updated building energy rules; DEP highlights 30% cap and Green Bank financing

Montgomery County Council convened a work session on Executive Regulation 17-23, the county’s implementing rules for the Building Energy Performance Standards (BEPS), focusing on regulatory changes, implementation supports and financing available to building owners.

John Monger, director of the Department of Environmental Protection, told the council that DEP revised the transmitted regulations after extensive stakeholder engagement and added a 30% performance cap so no building would be required to reduce energy use more than 30% from its baseline. Monger said the changes are intended to preserve progress toward the county’s climate goals while making compliance achievable for a broad range of buildings.

Emily Curley, DEP’s building energy performance programs manager, reviewed how BEPS applies: most commercial and multifamily buildings 25,000 square feet and larger are covered (about 1,800 buildings countywide), benchmarking is required annually (reports due June 1), and each building receives a baseline, an interim standard and a final standard based on building type or a 30% reduction cap. Curley gave an example showing how a multifamily building with a baseline site energy use intensity (EUI) of 60 would have a final standard set at the greater of the type-based standard or a 30% reduction from baseline (in the example, capped at 42). She said about one-third of covered buildings already meet the final standard.

Curley outlined two compliance routes: a performance path in which owners reduce normalized net site EUI through retrofits, efficient equipment replacement, electrification or on-site renewables; and a Building Performance Improvement Plan (BPIP) path, a tailored retrofit plan for buildings facing economic or technical constraints. For measures counted toward a BPIP, DEP will require implementation of any measure with a simple payback of five years or less before a building’s final deadline; specially designated building types (affordable housing, common ownership communities, rent-stabilized multifamily, nonprofit-owned buildings, hospitals, places of worship, private schools and small businesses) follow a shorter payback benchmark when evaluating cost-effectiveness.

Council members asked about potential overlap with state action. Curley and Monger said DEP has coordinated closely with the Maryland Department of the Environment and the county’s state delegation and that the county’s amended rules were designed to demonstrate flexibility the state might adopt. Monger said the county’s modifications aim to preserve compatibility on both the letter and the compliance side.

Financing and technical assistance were central to the session. Stephen Morrell, CEO of the Montgomery County Green Bank, described the bank’s model of leveraging public funds with private capital, underwriting regulatory risk, and providing technical-assistance providers to subsidize audits and feasibility studies. Morrell said the Green Bank will use its Greenhouse Gas Reduction Fund award to capitalize a revolving fund and to leverage private capital; he corrected an earlier figure and said the award is $68,000,000. “We take public sector capital and grow it with private sector capital,” Morrell said, describing programs that reduce up-front costs and bridge timing differences when tax-credit payments are delayed.

Council members also raised questions about outreach, staffing and tenant protections. DEP staff said the department has dedicated personnel and partner programs (Green Bank technical assistance, DEP help desk and a Building Performance Improvement Board) to assist building owners, provide consistent messaging and review BPIPs. Curley said DEP and partners will produce plain-language materials, scorecards and owner-specific guidance to help landlords, property managers and tenants understand timelines and options.

Council President said the council will consider formal action on the regulations on Feb. 25; Monger and staff noted the method-2 regulatory process gives the council a deadline of Feb. 28, after which the most recently transmitted regulation would take effect by default if the council takes no action. The session ended with a reminder about the Feb. 25 vote date and a unanimous approval of the consent calendar before the council recessed.

The work session combined technical detail on compliance and implementation with financing commitments aimed at reducing the cost burden on financially constrained building owners; the council will return to vote on the regulations on Feb. 25.