5 CCR 1001-32
Department of Public Health and Environment REGULATION NUMBER 28 BUILDING BENCHMARKING AND PERFORMANCE STANDARDS 5 CCR 1001-32 [Editor’s Notes follow the text of the rules at the end of this CCR Document.] Outline of Regulation PART A Applicability and General Provisions PART B Benchmarking and Reporting Requirements PART C Building Performance Standards and Compliance Pathways PART D Recordkeeping PART E Penalties PART F Statement of Basis, Specific Statutory Authority, and Purpose Pursuant to Colorado Revised Statutes Section 24-4-103 (12.5), materials incorporated by reference are available for public inspection during normal business hours, or copies may be obtained at a reasonable cost from the Air Quality Control Commission (the Commission), 4300 Cherry Creek Drive South, Denver, Colorado 80246-1530. Some material incorporated by reference is also available through the United States Government Printing Office, online at www.govinfo.gov. Materials incorporated by reference are those editions in existence as of the date indicated and do not include any later amendments.
PART A Applicability and General Provisions I. Purpose I.A. This regulation establishes energy-use benchmarking data reporting and building performance requirements for owners of existing and new covered buildings in order to meet greenhouse-gas emission reductions goals for such buildings under 25-7-142(8)(a)(II)(A)-(B), C.R.S. (2022).
II. Applicability II.A. This regulation applies to owners of covered buildings, as defined in Section IlI.O.
III. Definitions III.A. “Affordable housing” means (I) for a household residing in housing on a rental basis, annual income of the household is at or below eighty percent of the area median income of households of that size in the county in which the housing is located; (II) for a household residing in housing on a home ownership basis, annual income of the household is at or below one hundred forty percent of the area median income of households of that size in the county in which the housing is located; or (III) housing that incorporates mixed-income development.
III.E. “Agricultural product” means any agricultural, horticultural, viticultural, or vegetable products or poultry or poultry products grown or produced in Colorado. Agricultural products do not include “regulated marijuana” as defined by Colorado’s Marijuana Enforcement Division in 1 CCR 212-3 (2022).
III.F. “Benchmarking” means to input benchmarking data into a benchmarking tool to measure and assess the energy performance and greenhouse gas pollution for a covered building for the reporting year. III.G. “Benchmarking data” means the information related to a covered building that is input into or calculated by a benchmarking tool. III.H. “Benchmarking tool” means the ENERGY STAR® Portfolio Manager or a successor online resource used to track and assess the performance of certain properties relative to similar properties.
III.I. “Beneficial electrification” means converting the energy source of a customer’s end use from a nonelectric fuel source to a high-efficiency electric source, or avoiding the use of nonelectric fuel sources in new construction or industrial applications, if the result of the conversion or avoidance is to III.I.1. Reduce net greenhouse gas emissions over the lifetime of the conversion or avoidance; and III.I.2. Reduce societal costs or provide for more efficient utilization of grid resources.
III.J. “Biomedical research laboratory” means a scientific laboratory used to conduct research relating to both biology and medicine. III.K. “Building owner” means a person possessing title to a building or property or the person’s designated agent.
III.L. “Building performance standards” (BPS) means standards a covered building must meet to achieve the greenhouse gas reduction requirements under 25-7-142(8)(a)(II), C.R.S. (2022).
III.M. “Campus” means a collection of two or more buildings that are owned and operated by the same person and that have a shared purpose and function as a single property. Campus includes two or more of the buildings that comprise the capitol complex.
III.N. “CEO” means the Colorado Energy Office.
III.O. “Covered building” means a building comprising a gross floor area of fifty thousand (50,000) square feet or more that is occupied by a single occupant or a group of tenants. Covered building does not include III.O.1. Covered buildings that are a storage facility, stand-alone parking garage, or an airplane hangar that lacks heating and cooling;
III.P. “Customer-owned retail distributed generation system” means retail distributed generation or a renewable energy storage system owned or controlled by a covered building owner.
III.Q. “Data center” means buildings specifically designed and equipped to meet the needs of high density computing equipment, such as server racks, used for data storage and processing. Gross floor area of data centers should include all space within the building(s) including raised floor computing space, server rack aisles, storage silos, control console areas, battery rooms, mechanical rooms for cooling equipment, administrative office areas, elevator shafts, stairways, break rooms and restrooms. When a data center is located within a larger building, the gross floor area of the data center should include only the spaces that are uniquely associated with the data center (e.g., not include spaces shared by the data center and other tenants, such as break rooms or hallways) in the building. III.R. “Demand flexibility” means the use of communication and control technology to shift electricity use across hours of the day while delivering end-use services (e.g., air conditioning, domestic hot water, electric vehicle charging) at the same or better quality but lower cost. It does this by applying automatic control to reshape a customer’s demand profile continuously in ways that either are invisible to or minimally affect the customer, and by leveraging more-granular rate structures that monetize demand flexibility’s capability to reduce costs for both customers and the grid.
III.S. “Duplex” means a multi-family dwelling that has two separate residential units within one standalone building with the two units sharing a common wall or ceiling/floor and each having its own entrance. III.T. “ENERGY STAR” means the federal program authorized by 42 U.S.C. § 6294a (2007), as amended, to help customers, businesses, and industry save money and protect the environment through the adoption of energy- efficient products and practices.
III.U. “ENERGY STAR score” means the one-to-one-hundred numeric rating generated by the ENERGY STAR Portfolio Manager as a measurement of a building's energy efficiency.
III.V. “ENERGY STAR Portfolio Manager” means the resource management tool that enables building owners to track and benchmark energy in a building, or across multiple buildings, through an online platform used to measure their performance.
III.W. “Energy-use intensity” (EUI) means a building’s energy use, expressed as total site energy use per square foot per year.
III.X. “Financial hardship” means a property is experiencing at least one of the following conditions.
III.X.4. The property has been acquired by a deed in lieu of foreclosure. III.X.5. The property is the subject of a senior mortgage subject to a notice of default.
III.X.6. Due to the governor declaring a disaster emergency pursuant to §24-33.5-704 (4), C.R.S. (2022), the property, in at least two of the previous five years, generated annual rental income or revenue that totals sixty percent or less of the five-year average immediately preceding the disaster.
III.Y. “Greenhouse gas” (GHG) means carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), sulfur hexafluoride (SF6), and nitrogen trifluoride (NF3). III.Z. “Gross floor area” (GFA) means the total building area, as measured from the outside surface of each exterior wall of the building, including above- grade and below-grade space.
III.AA. “High-efficiency electric equipment” means electrical equipment that is, for example, certified according to ENERGY STAR, or meets the minimum efficiency requirements of the current version of American Society of Heating, Refrigerating and Air-Conditioning Engineers’ (ASHRAE) Standard 90.1, 2021 International Energy Conservation Code (IECC), the Federal Energy Management Program (FEMP) efficiency requirements, or newer requirements where applicable.
III.BB. “Industrial purpose” means a building or structure used for industrial operations including, but not limited to, factories, mills, shops, processing plants, assembly plants, fabricating plants, research or development facilities, operations by energy producers, electric generation unit, refineries, meat packing plants, dairies, steel mills, cement plants, mining operations, airline operations, wastewater treatment plants, landfills, and abandoned coal mines. The gross floor area of a building or structure used for industrial operations must include all space within the building(s) at the building or structure including production or industrial operation areas, offices, conference rooms, employee break rooms, storage areas, mechanical rooms, stairways, and elevator shafts to determine if the building or structure meets the covered building exemption Section III.O.2. III.CC. “Manufacturing purpose” means a building or structure that includes a main production area containing machinery and equipment used for producing products. The gross floor area of a building or structure used for producing products must include all space within the building(s) at the building or structure, including production areas, offices, conference rooms, employee break rooms, storage areas, mechanical rooms, stairways, and elevator shafts to determine if the building or structure meets the covered building exemption Section III.O.2. For purposes of the exemption in Section III.O.2., manufacturing purposes does not include marijuana cultivation facilities, as defined by Colorado’s Marijuana Enforcement Division in 1 CCR 212-3 (2022).
III.DD. “Mixed use building” means a building that contains multiple property types where there is not one single use type that represents 50% or more of the building or property’s gross floor area, including parking gross floor area.
III.EE. “Multifamily housing” means any property used or intended to be used as a residence and that contains four or more dwelling units. Multifamily housing includes a condominium or cooperative.
III.FF. “Parking” means buildings and lots used for parking vehicles. This includes open parking lots, partially enclosed parking structures, and completely enclosed (or underground) parking structures. Parking garages may be free standing or physically connected to the property. III.GG. “Power purchase agreement” (PPA) means an agreement executed between a covered building owner and the owner of a renewable energy resource or renewable energy storage system where the energy or share of energy produced from the renewable energy resource or renewable energy storage system is dedicated to serving the covered building. For purposes of this rule, a utility cannot be the owner of the renewable energy resource or renewable energy storage system.
III.HH. “Power usage effectiveness” (PUE) means a measure of how much energy is consumed by the power supply and cooling systems in a Data Center relative to the amount of energy delivered directly to the IT equipment. PUE is equal to the total energy consumption of a Data Center (for all fuels) divided by the energy consumption used for the IT equipment.
III.II. “Property type” means the primary use of a building. Each property type will have a different set of property use details, which refer to the business activity at the property, such as weekly operating hours, number of workers, and number of computers. If a building or property has multiple uses, for purposes of benchmarking the property type is based on the use that accounts for more than 50% of a building’s or property’s gross floor area. As referenced in the definition of mixed use building in Part A, Section III.DD., if there is not one single use type that represents 50% or more of the building or property’s gross floor area, the property type will be classified as “mixed use.”
III.JJ. “Public building” means a covered building owned by: the state; a local government; a district or special district regulated under title 32; a state institution of higher education; a private institution of higher education as defined in § 23-18-102 (9), C.R.S. (2022); a school district created pursuant to article 30 of title 22; and a charter school authorized pursuant to Part 1 of Article 30.5 of Title 22 of the C.R.S. (2022). III.KK. “Qualifying utility” means an electric or gas utility with five thousand or more active commercial and industrial service connections, accounts, or customers in Colorado, including: an investor-owned electric or gas utility; a cooperative electric association; or a municipally owned electric or gas utility. Qualifying utility also means a natural gas supplier with five or more active commercial or industrial connections, accounts, or customers in Colorado.
III.LL. “Renewable energy credit” (REC) means a contractual right to the full set of non-energy attributes, including any and all credits, benefits, emissions reductions, offsets, and allowances, howsoever entitled, directly attributable to a specific amount of electric energy generated from a renewable energy resource. One REC results from one megawatt hour
III.OO. “Renewable energy storage system” means any commercially available system, including batteries and batteries paired with on-site generation, that is capable of retaining, storing, and delivering energy by chemical, thermal, mechanical, or other means.
III.PP. “Renovation” means the repair, remodeling, restoration, and preservation of a covered building and any associated fixtures or improvements. III.QQ. “Retail distributed generation” means a renewable energy resource or renewable energy storage that is located on any property owned or leased by any customer within the service territory of the qualifying retail utility and is interconnected on the customer’s side of the utility meter. Retail distributed generation must provide electric energy primarily to serve the applicable covered building’s loads and must be sized to supply no more than two hundred percent of the reasonably expected average annual total consumption of electricity at all properties owned or leased by the customer within the utility’s service territory. Retail distributed generation also includes retail distributed generation resources provided to a covered building owner through a power purchase agreement or a community solar garden subscription. Retail distributed generation does not include utility- owned renewable electric generation.
III.RR. “Single-family home” means a standalone residential building designed to be used as a single-dwelling unit with one owner and no shared walls with another residence.
III.SS. “Site energy-use intensity” or “Site EUI” means the annual amount of all the energy the building consumes on-site, regardless of the source. A building’s site EUI is calculated by dividing the total energy consumed by the building in one year (measured in kBtu) by the total gross floor area of the building.
III.TT. “Source energy-use intensity” or “Source EUI” means EUI calculations that consider the total amount of energy required for the building, including the energy used to produce and transmit any energy that comes from offsite. III.UU. “State institution of higher education” means an institution as defined in § 23-1-108(7)(g)(II), CRS, (2022) and the Auraria Higher Education Center, governed pursuant to Article 70 of Title 23 of C.R.S. (2022). State institution of higher education does not include biomedical research laboratories.
III.VV. “Triplex” means a multi-family dwelling that has three separate residential units within one standalone building with the units sharing one or two common walls or ceiling/floors and each having its own entrance. III.WW. “Under-resourced building” means a building with limited access to resources, including revenues, funding, grants, or gifts that can help with building operations or to comply with the requirements of this rule, than other buildings within the same building type in the same utility service territory. Under-resourced buildings include, but are not limited to III.WW.1. Buildings owned by organizations that qualify at tax exempt under Section 501(c) of the Internal Review Code.
III.XX. “Unoccupied” means a building without occupants or tenants other than security, maintenance staff, or construction workers during a construction or renovation project.
III.YY. “Weather-normalized” means a method for modifying the measured building energy use in a specific weather year to energy use under normal weather conditions.
IV. Annual fee IV.A. Except as provided in Section IV.B., covered building owners must pay an annual fee, by June 1 of every reporting year, to the CEO of $100 per covered building. Beginning in calendar year 2026, the annual fee must be paid by November 1.
V. Severability If any section, clause, phrase, or standard contained in these regulations is for any reason held to be inoperative, unconstitutional, void, or invalid, the validity of the remaining portions thereof will not be affected and the Commission declares that it severally passed and adopted these provisions separately and apart. PART B Benchmarking and Reporting Requirements I. By June 1, 2024, and by June 1 of each year thereafter, covered building owners must report benchmarking data for the previous calendar year and additional information as specified below to the CEO on a CEO approved form. Owners of newly constructed buildings (i.e., buildings that were not built or occupied such that they had 2021 benchmarking data to submit by the initial reporting deadline of December 1, 2022) must start collecting benchmarking data once the owner has received a certificate of occupancy for the building and submit their first annual benchmarking data report the subsequent year (e.g., for a building with a certificate of occupancy starting March 1, 2023, submit by June 1, 2024, the building data from March 1, 2023, through December 31, 2023). Before submitting a benchmarking report, the covered building owner must run any automated data-checking function of the benchmarking tool and correct any errors discovered. The benchmarking data reported to the CEO must include the following.
I.A.4. Covered building owners, except for covered buildings described in Part C, Section I.D., who did not submit a compliance pathway selection in accordance with Sections I.A.1. or I.A.2. must comply by default with the energy efficiency compliance pathway in Part C, Section I.A.1. until a compliance pathway selection is submitted. Covered buildings described in Part C, Section I.D. must comply by default with a standard percent reduction compliance pathway. I.A.5. Covered building owners who are assigned the energy efficiency compliance pathway in Part C, Section I.A.1. pursuant to Part B, Section I.A.4. may still select a percent reduction compliance pathway in either Part C, Sections I.A.3. or I.B.2. if the covered building owner submits their benchmarking data for each year from 2021 up to the current reporting year (e.g., for a June 1, 2024, report submit 2021-2023 data). New covered buildings for which a 2021 baseline does not exist must provide each year of benchmarking data starting with and following the year the owner receives a certificate of occupancy for the building.
I.A.6. Owners of public buildings I.A.6.a. That become subject to performance standards under Part C between January 1, 2024, and December 31, 2026, must notify the CEO no later than sixty (60) days or in its next benchmarking report following completion of a construction or renovation project as described in Part A, Section II.B., whichever is sooner, of their chosen compliance pathway in Part C, Section I.
I.A.6.b. That become subject to performance standards under Part C on or after January 1, 2027, must notify the CEO in its next benchmarking report following completion of a construction or renovation project as described in Part A, Section II.B. of their chosen compliance pathway in Part C, Section I.
I.A.6.c. That specify the standard percent reduction compliance pathway in Part C, Sections I.A.3. or I.B.2. must submit each year of benchmarking data from 2021 up to the notification year (e.g., for a June 1, 2024, notification submit 2021-2023 data). Owners of public buildings for which a 2021 baseline does not exist must provide each year of benchmarking data starting with and following the year the owner receives a certificate of occupancy for the building up to the notification year.
I.A.6.d. That do not specify their chosen compliance pathway must comply by default with the energy efficiency compliance pathway in Part C, Section I.A.1. until a compliance pathway selection is submitted.
I.B. A physical description of the covered building and descriptions of its operational characteristics, including I.B.1. The name of the covered building, if any.
I.B.4. The covered building’s gross floor area.
I.B.5. The years in which the covered building has been certified by ENERGY STAR and the most recent date of certification, if applicable.
I.B.6. The data generated by the benchmarking tool for the covered building, including I.B.6.a. The ENERGY STAR score, if applicable.
I.B.6.b. Monthly energy use by fuel type.
I.B.6.c. Annual electricity use by the covered building associated with the customer-owned retail distributed generation system or electricity purchased from retail distributed generation, if applicable, subject to the requirements of Part C, Sections I.B.1.b. or I.B.1.c.
I.B.6.d. Annual electricity produced by the customer-owned retail distribution generation system in kilowatt-hours (kWh) that is exported to the grid and not associated with the covered building’s electricity use, if applicable.
I.B.6.e. Site energy-use intensity and source energy-use intensity.
I.B.6.f. Weather-normalized site energy-use intensity and source energy-use intensity.
I.B.6.g. Confirmation from the benchmarking tool that data quality has been checked and no errors were identified by the benchmarking tool.
I.B.6.h. Annual total electricity consumption, in kilowatt-hours (kWh), if applicable.
I.B.6.i. Annual total gas consumption, in British Thermal Units (Btu), if applicable.
I.B.6.j. Monthly peak electricity demand, if available for reporting through the benchmarking tool, if applicable.
I.B.7. Greenhouse gas emissions, including total, indirect, and direct emissions.
I.B.8. The name of the gas and/or electric utility provider(s) for the covered building.
I.B.9. The type and number of electric vehicle (EV) charging stations associated with the building and all relevant meter information. I.B.10. Covered buildings that are marijuana cultivation facilities must report their property type as “manufacturing” in the benchmarking tool.
I.C. In addition to the data generated by the benchmarking tool, covered building owners must report to the CEO the following information, if applicable.
I.D. A demonstration of progress towards meeting the building performance standards in Part C. Such demonstration may include, but is not limited to, documentation of completed or planned energy efficiency measures or replacements of fossil fuel equipment with high-efficiency electric equipment, including dates completed and/or the timeframe for any planned measures or replacements, as well as results from the ENERGY STAR Portfolio Manager Building Emissions Calculator in a spreadsheet (.xlsx) file downloaded from the calculator.
I.E. Covered building owners who utilize their customer-owned retail distributed generation system or renewable energy resource as specified in Part C, Section I.B. must submit documentation of the ownership and retirement of their renewable energy credits to demonstrate compliance. I.F. The following covered building owners may report benchmarking data at the campus-wide level.
I.F.3. The owner of a public building that is a covered building. I.G. Covered building owners reporting benchmarking data at the campus-wide level must also submit documentation of the number of covered buildings that are part of the campus; the property type of each of the covered buildings; the meter information for each building; and the gross floor area, including parking, of each of the covered buildings.
I.H. Covered building owners must include in the 2027 through 2030 benchmarking data report a demonstration that the covered building met the 2026 site EUI, greenhouse gas emission reduction target, data center target, or building specific target as provided in Part C. I.H.1. Building owners demonstrating compliance under Part C, Section I.A., must include the 2026, or subsequent year through 2029 (e.g., in the 2028 report include the data reflecting 2027) results from the ENERGY STAR Portfolio Manager, specifically the weather- normalized site EUI. In meeting the site EUI targets in Part C, Section I.A., individual building site EUIs must be normalized for weather and, if and when available in ENERGY STAR Portfolio Manager, normalized for occupancy.
I.H.4. Building owners demonstrating compliance through an adjustment under Part C, Section II. must include the specific adjusted timeline or target as approved by the CEO and documentation demonstrating the building owner’s progress on the submitted plan to achieve an adjusted timeline, if applicable.
I.I. Covered building owners must include in the 2031 benchmarking data report, and each year thereafter, a demonstration that the covered building met the 2030 site EUI, greenhouse gas emission reduction target, data center target, or building specific target as provided in Part C. I.I.1. Building owners demonstrating compliance under Part C, Section I.A., must include the 2030, or subsequent year (e.g., in the 2032 report include the data reflecting 2031) results from the ENERGY STAR Portfolio Manager, specifically the weather normalized site
I.I.3. Building owners demonstrating compliance under Part C, Sections I.C. or I.D., must demonstrate that the covered building has met its applicable building specific target for 2030, or subsequent year (e.g., in the 2032 report include the data reflecting 2031). I.I.4. Building owners demonstrating compliance through an adjustment under Part C, Section II. must include the specific adjusted timeline or target as approved by the CEO and documentation demonstrating the building owner’s progress on the submitted plan to achieve an adjusted timeline, if applicable.
II. Waivers, extensions, and exemptions II.A. Waivers II.A.1. A covered building owner may seek a waiver from the annual requirement to report benchmarking data in Part B, Section I. The waiver request must be submitted on a CEO approved form. To seek a waiver, the covered building owner must submit waiver documentation to and receive approval from the CEO. The covered building owner must submit a new waiver request for each year the owner is seeking a waiver. Covered building owners applying for a report waiver for the calendar year to be benchmarked must submit a waiver application to the CEO any time after June 1 of the calendar year to be benchmarked and on or before May 1 of the reporting year (e.g., for calendar year 2023 data, the waiver request must be submitted between June 1, 2023, and May 1, 2024). The CEO may approve an alternate timeline for submitting a waiver request on a case by case basis. A benchmarking waiver request must establish that the covered building has met one or more of the following conditions for the calendar year to be benchmarked. II.A.1.a. The covered building was unoccupied for at least thirty consecutive days of the year.
II.A.2. A covered building owner who is not listed in Part B, Section I.F., may seek a waiver from the annual requirements to report benchmarking data on a per building basis and request to instead submit benchmarking data as a campus if there is a compelling state or national security interest for the covered building owner to do so. The covered building owner must provide information to the CEO documenting why they are requesting to submit benchmarking data as a campus. The CEO may work with the covered building owner to permit the owner to submit benchmarking data in a format other than through the benchmarking tool in order to address state or national security interests related to data reporting. II.B. Extensions II.B.1. A covered building owner may request a time extension from the CEO to submit a benchmarking report if the owner submits documentation to the CEO demonstrating that, despite the owner's good-faith effort, the owner was unable to complete the benchmarking report for the calendar year to be benchmarked in a timely manner because of the failure or refusal of a qualifying utility or a utility customer to provide the necessary information or permission, as applicable.
II.B.2. Covered building owners that request a benchmarking report time extension must submit the extension application to the CEO by May 15 of the reporting year (e.g., by May 15, 2024, for calendar year 2023 data) on a CEO-approved form.
II.C. Exemptions II.C.1. The owner of a building with a gross floor area of 50,000 square feet or more that is occupied by a single occupant or group of tenants may, in the interest of regulatory certainty, request from the CEO an affirmative exemption from the annual requirement to report benchmarking data in Part B, Section I. if their building does not meet the definition of a covered building in Part A, Section III.O. II.C.1.a. Any exemption request must be submitted on a CEO approved form and include all required information to be considered.
II.C.2. Owners of single-family homes, duplexes, or triplexes are not required to file an annual exemption request but must report their benchmarking data annually if the property type changes such that the building meets the definition of and applicability for a covered building.
II.D. If a covered building owner’s waiver or exemption request is denied by the CEO, the building owner may request the CEO executive director (or their designee) to review the determination. The building owner must request the review within sixty (60) days of the initial denial and before the June 1 reporting deadline for the calendar year in which the waiver was applied
PART C Building Performance Standards and Compliance Pathways I. Compliance pathways Owners of covered buildings must reduce building greenhouse gas emissions through one of the following building performance standards compliance pathways. Owners of covered buildings must comply with the performance standard in the selected compliance pathway on an annual basis beginning in 2026. Owners of covered buildings must meet and maintain the 2026 standard for the calendar years 2026 through 2029 and the 2030 standard for calendar years 2030 through 2050, unless otherwise extended by subsequent rules of the Commission. I.A. Energy efficiency I.A.1. The covered building owner must reduce the energy consumption of the building through the implementation of energy efficiency measures and/or technologies to meet the applicable property type weather-normalized site EUI target in Table 1.
I.B. Greenhouse gas intensity reductions I.B.1. A covered building owner unable to achieve the building performance standards in Part C, Section I.A. may demonstrate compliance through reduction of greenhouse gas emissions attributable to the building’s energy use through energy efficiency or replacing fossil fuel equipment with high-efficiency electric equipment. A building owner unable to fully comply with the greenhouse gas compliance pathway target may use customer- owned retail distributed generation systems or retail distributed generation or utility subscription services in accordance with the requirements of Sections I.B.1.b. or I.B.1.c. or I.B.1.d., or may achieve greenhouse gas reductions through alternative measures approved by the CEO in accordance with Section I.B.1.e. In order to use customer-owned retail distributed generation systems or retail distributed generation, the covered building owner must demonstrate that the covered building owner has submitted an energy audit to the CEO and demonstrated that a building owner has exhausted cost-effective energy efficiency and electrification measures for the covered building. In using renewable energy generated by a customer-owned retail distributed generation system or retail distributed generation, a covered building owner: I.B.1.a. Must demonstrate that the covered building has not met the applicable greenhouse gas emissions intensity target in Table 1 using the ENERGY STAR Portfolio Manager Building Emissions Calculator. A covered building owner must demonstrate this by doing the following I.B.1.a.(i) Import or upload the data for the covered building from ENERGY STAR Portfolio Manager to the ENERGY STAR Portfolio Manager Building Emissions Calculator;
I.B.1.c. The owner of a covered building who does not own the RECs from their customer-owned retail distributed generation system or from retail distributed generation where the interconnect request was filed with the utility company prior to December 31, 2023, may purchase RECs associated with other renewable energy resources located in Colorado to demonstrate compliance with Section I.B. if the following conditions are met.
I.B.1.c.(i) The covered building owner owns the RECs and retires them in the year generated;
I.B.1.c.(ii) The customer-owned retail distributed generation system or retail distributed generation is located in Colorado, either onsite or offsite of the covered building; and I.B.1.c.(iii) The covered building owner submits to CEO an energy audit for the building completed by an approved energy auditor as specified in Sections II.C.1. through II.C.4. CEO may request that the covered building owner provide additional information demonstrating that the building owner has analyzed energy efficiency and electrification options, will employ those to the extent feasible, and renewable electric generation is the only way to make up any remaining gap to comply with the greenhouse gas intensity reduction target.
I.B.1.c.(iv) Once the covered building owner has submitted the energy audit and demonstrates that a building owner has exhausted cost-effective energy efficiency and electrification measures for the covered building, the building owner may use renewable energy that represents no more than the amount of electricity produced by the customer-owned retail distributed generation system or retail distributed generation and consumed by the covered building on an annual basis for each compliance year in Table 1.
I.B.1.d. Owners of covered buildings may utilize utility subscription services as a compliance mechanism subject to the following limitations.
I.B.1.d.(i) The covered building owner submits to CEO an energy audit for the building completed by an approved energy auditor as specified in Part B.
Sections II.C.1. through II.C.5. CEO may request that the building owner provide additional information demonstrating that the building owner has analyzed energy efficiency and electrification options, will employ those to the extent feasible, and renewable electric generation is the only way to make up any remaining gap to comply with the GHG intensity reduction target.
I.B.1.d.(ii) Once the covered building owner has submitted the energy audit and demonstrates that the covered building owner has exhausted cost-effective energy efficiency and electrification measures for the covered building, the covered building owner may use renewable energy demonstrated through retention of RECs associated with subscription services for no more than the amount needed to achieve compliance for under this Section after the results and recommendations of the energy audit for the building are taken into account.
I.B.1.d.(iii) Any renewable energy resources and associated RECs retired for purposes of demonstrating compliance with this Section and utilized as part of a utility subscription service are not also used for any other utility emission reduction requirement, including but not limited to Clean Energy Plan compliance.
I.B.1.e. The owner of a covered building may use alternative measures, including utility-offered programs, not identified in this subsection to demonstrate compliance with Section I.B. if the owner obtains written approval from the CEO. The owner of a covered building shall submit an application to the CEO at least six months prior to implementation of the measure. The measure can be used for compliance only if the following conditions are met.
I.B.1.e.(i) The measure achieves reduction of greenhouse gas emission in Colorado.
I.B.1.e.(ii) The greenhouse gas emission reductions are not the result of decarbonization of the electrical or natural gas utility grids.
I.B.1.e.(iii) The CEO, in consultation with the Division, approves the calculation methodology to quantify the greenhouse gas emission reductions.
I.B.2. Standard percent reduction I.B.2.a. A covered building owner unable to achieve the site GHG- intensity target in Table 1 may comply by achieving and maintaining a standard percent reduction in their covered building’s greenhouse gas intensity as compared to the covered building’s 2021, or first reporting year, benchmarked baseline greenhouse gas intensity by using the ENERGY STAR Portfolio Manager Building Emissions Calculator and applying the applicable Colorado-specific emission factor for electricity to both the baseline emissions calculation and the target year emissions calculation and converting the results to greenhouse gas intensity values in kg CO2e/SF to determine the percent reduction achieved. Under this compliance pathway, the covered building must I.B.2.a.(i) In 2026, achieve and maintain a standard percent reduction of 13% in comparison to the covered building’s 2021 benchmarked baseline that has been converted to a greenhouse gas intensity value.
I.B.2.a.(iv) Demonstrate that the covered building has met the applicable standard percent reduction using the ENERGY STAR Portfolio Manager Building Emissions Calculator as specified in Sections I.B.1.a.(i) through I.B.1.a.(iii). Table 1 – Property Type Site EUI and GHG Intensity Targets 2026- 2030- 2026- 2030- 2029 2050 2029 Site 2050 Site GHG GHG Property Type EUI EUI Intensity Intensity (kBtu/SF) (kBtu/SF) (kg (kg CO2e/SF) CO2e/SF)
Adult Education 53.1 3.3 1.9
Ambulatory Surgical Center 79.2
Aquarium 98.3
Automobile Dealership 55.8
Bank Branch 83.0
Bar/Nightclub 113.0
Barracks 52.8
Bowling Alley 114.5
Casino 74.6
College/University 74.1
Convenience Store with Gas
Station Convenience Store without Gas
Station Convention Center 43.0
Courthouse 66.8
Distribution Center 38.5
Enclosed Mall 59.5
Fast Food Restaurant
Financial Office
Fire Station
Fitness Center/Health Club/Gym
Food Sales
Food Service
Hospital (General Medical &
Surgical)
Hotel
Ice/Curling Rink
Indoor Arena
K-12 School
Laboratory
Library
Lifestyle Center
Mailing Center/Post Office
Medical Office
Movie Theater
Multifamily Housing
Museum
Non-Refrigerated Warehouse
Office
Other
Other - Education
Other - Entertainment/Public
Assembly Other - Lodging/Residential
Other - Mall
Other - Public Services
Other - Recreation
Other - Restaurant/Bar
Other - Services
Other - Specialty Hospital
Other - Stadium
Other - Technology/Science
Outpatient Rehabilitation/Physical
Therapy Performing Arts
Personal Services (Health/Beauty,
Dry Cleaning, etc.)
Police Station
Pre-school/Daycare
Prison/Incarceration
Race Track
Refrigerated Warehouse
Repair Services (Vehicle, Shoe,
Locksmith, etc.)
Residence Hall/Dormitory
Residential Care Facility
Restaurant
Retail Store
Roller Rink
Self-Storage Facility
Senior Living Community
Social/Meeting Hall
Stadium (Closed)
Stadium (Open)
Strip Mall
Supermarket/Grocery Store
Swimming Pool
Transportation Terminal/Station
Urgent Care/Clinic/Other
Outpatient Veterinary Office
Vocational School
Wholesale Club/Supercenter
Worship Facility
Zoo
I.C. Upon a complete submission of the information described in Section I.C.3., the CEO will assign data centers a power usage effectiveness
I.C.3.b. Energy auditors must have an in-depth knowledge of data center operations and energy efficiency measures and may be certified by the Association of Energy Engineers (AEE), ASHRAE, the Energy Management Association, the Building Performance Institute, or similar CEO-approved certifying entity.
I.C.3.c. Energy auditors must certify that the results of the energy audit are accurate and complete.
I.C.4. To request a building specific target, the owner of the covered building must submit the information in Section I.C.3. to the CEO on a CEO-approved form by December 31, 2025, for the 2026 target and December 31, 2029, for the 2030 target.
I.D. Mixed use buildings, marijuana cultivation facilities, and covered buildings with installed electric vehicle (EV) charging stations that are not able to be sub-metered will default to the standard percent reduction compliance pathway in Part C, Sections I.A.3. or I.B.2. If these buildings do not choose to comply with the standard percent reduction compliance pathway in Part C, Sections I.A.3. or I.B.2., they may request an individualized target.
I.D.3. Marijuana cultivation facilities will be assigned a target based on the facility’s total gross floor area and energy usage, including climate control, lighting, and irrigation systems.
I.D.4. To request an individualized target, the owner of the covered building must submit the following to the CEO on a CEO-approved form by December 31, 2025, for the 2026 target and December 31, 2029, for the 2030 target.
I.D.4.a. The covered building’s 2021 and each subsequent year of benchmarking data. New covered buildings for which a 2021 baseline does not exist must provide the benchmarking data submitted for the first full calendar year of building data.
I.D.4.b. Mixed use buildings must submit documentation of the gross floor area for each property type for that building; total energy consumption; sub-metered energy consumption; data center or server closet size, if applicable; and other criteria listed on the CEO-approved form.
I.D.4.c. Covered buildings with EV charging stations that are not sub-metered must submit documentation of the specific energy usage of the EV charging stations.
I.D.4.d. Marijuana cultivation facilities must submit documentation of the facility’s total gross floor area and energy usage, including climate control, lighting, and irrigation systems; and other criteria listed on the CEO- approved form.
I.E. Owners of covered buildings that seek to challenge an individualized target assigned by the CEO pursuant to Sections I.C. or I.D. must apply for a target adjustment pursuant to Sections II.B. and II.C. Data centers applying for a building specific target adjustment need not perform a second energy audit as required in Part C, Section II.C.
II. Compliance pathway adjustments II.A. Adjusted Timeline Covered building owners may request an adjustment to the timeline to achieve the 2026 and/or 2030 building performance standards pursuant to Part C, Section I. The request must be submitted on a CEO approved form. To apply for a timeline adjustment a covered building owner must II.A.1. Submit an application to the CEO requesting an adjusted timeline, including II.A.1.a. The specific adjusted timeline needed.
II.A.2. Covered building owners applying for an adjusted timeline must submit their application to the CEO by December 31, 2025, for the 2026 target and by December 31, 2029, for the 2030 target. II.A.3. Covered building owners that may apply for this type of adjustment include, but are not limited to II.A.3.a. Affordable housing and under-resourced buildings. II.A.3.a.(i) Owners of covered buildings that do not fall into one of the categories in the definition of under- resourced buildings in Part A, Section III.WW. may petition the CEO for status as an under-resourced building by submitting on a CEO-approved form a description of the building; an explanation of why the building should be considered under-resourced; and evidence that the building has less access to resources than other similarly situated buildings in the relevant utility service territory.
II.A.3.b. Buildings undergoing a major renovation that does not align with the target dates but that will achieve the site EUI or greenhouse gas target.
II.A.3.c. Building owners experiencing significant supply chain or workforce delays.
II.A.3.d. Building owners who can demonstrate a plan to replace building heating and cooling systems at end of life where the system end of life occurs after the compliance period.
II.A.3.e. Building owners experiencing financial hardship, as defined in Part A, Section III.X.
II.A.3.f. Inherent and unique characteristics of the physical building that prohibit them from reaching the timeline. II.A.3.g. Buildings that require updates to the electrical distribution infrastructure that cannot be timely completed to meet the performance standard deadline.
II.A.3.h. Building owners that purchase a covered building within the 12 month period before a required building performance standard deadline. Building performance standard deadline is December 31, 2026, for the 2026 target and December 31, 2030, for the 2030 target.
II.B. Standard Performance Target Adjustments Covered building owners who have selected the EUI or GHG compliance pathway may request a standard adjusted 2026 and/or 2030 performance target. The request must be submitted on a CEO approved form.
II.B.2.c. Third-party data verification.
II.B.3. The CEO may request other information from the covered building owner in order to generate a standard performance adjustment target.
II.C. Adjusted Performance Target for Under-Resourced Buildings Owners of under-resourced buildings may request an adjusted 2026 and/or 2030 performance target. The request must be submitted on a CEO approved form. To apply for an adjusted target the owner of an under-resourced building must II.C.1. Submit an application to the CEO requesting an adjusted target, including II.C.1.a. Each year of the benchmarking data from 2021 up to the request year (e.g., for a January 1, 2025, request submit 2021-2024 data). New covered buildings for which a 2021 baseline does not exist must provide each year of benchmarking data starting with and following the year the owner receives a certificate of occupancy for the building. The covered building must also submit a third-party data verification checklist for each year of benchmarking data. II.C.1.b. Narrative detailing the building characteristics (e.g., year of construction, state or federal historical status, etc.) or functional variations that qualify for an adjustment.
II.C.1.e. Documentation demonstrating collaboration with the building’s utility or utilities to determine the feasibility of gas and electric beneficial electrification and/or gas or electric demand side management programs.
II.C.2. Covered building owners applying for an adjusted target must submit their application to the CEO by December 31, 2025, for the 2026 target and by December 31, 2029, for the 2030 target. II.C.3. Covered building owners that may apply for this type of adjustment include, but are not limited to II.C.3.a. Covered buildings with inherent and unique characteristics of the physical building that make the weather normalized site EUI target unachievable or cost prohibitive. II.C.3.b. Affordable housing and under-resourced buildings. II.C.3.b.(i) Owners of covered buildings that do not fall into one of the categories in the definition of under- resourced buildings in Part A, Section III.WW. may petition the CEO for status as an under-resourced building by submitting on a CEO-approved form a description of the building; an explanation of why the building should be considered under-resourced; and evidence that the building has less access to resources than other similarly situated buildings in the relevant utility service territory.
II.D. Owners of covered buildings applying for a compliance adjustment to a building’s target or timeline pursuant to Part C, Section II.A. must also submit to the CEO an energy audit for the building completed by an approved energy auditor.
II.D.3. Energy auditors must be certified by the Association of Energy Engineers (AEE), ASHRAE, the Energy Management Association, the Building Performance Institute, or similar CEO-approved certifying entity.
II.D.4. Energy auditors must certify that the results of the energy audit are accurate and complete.
II.D.5. The energy audit may be in the form of a strategic energy management plan for covered buildings that are part of a campus. II.E. In addition to target adjustment application materials submitted by an owner of a covered building, the CEO will also consider the appropriateness of a standard adjustment as suggested by EPA. II.F. Owners of covered buildings that will demonstrate compliance with the building performance standards through a compliance pathway other than the selected compliance pathway, as specified pursuant to Part B, Section I.A., may request an adjustment from the CEO. The covered building owner must provide the materials required in Part C, Sections II.B. and II.C. and demonstrate that the building owner has achieved compliance through the other compliance pathway. The request must be submitted to the CEO on a CEO-approved form by January 31, 2027 (for the 2026 target) and January 31, 2031 (for the 2030 target).
II.G. If a covered building owner’s adjustment request is denied by the CEO, the building owner may request the CEO executive director (or their designee) to review the determination. The building owner must request the review within ninety (90) days of the initial denial. The executive director (or their designee) will make a recommendation on the adjustment request within 120 days of the review request.
III. A covered building owner that fails to meet the building performance standards through one of the compliance pathways in Section I. in the timeframe(s) specified or under an approved adjustment pursuant to Section II. must meet the building performance standards as expeditiously as practicable. III.A. Failure to timely comply with a performance standard under Part C will constitute a violation of these rules.
III.C. Each month that a covered building owner fails to demonstrate compliance with the building performance standards or demonstrate progress towards meeting the building performance standards, as set forth in Section III.A., constitutes an independent violation and may subject the covered building owner to additional civil penalties under 25-7-122, C.R.S. (2022), beyond the penalties specified in Part E. and, in addition to civil penalties, a requirement to perform one or more projects to mitigate violations related to excess emissions of greenhouse gas emissions. Covered building owners in violation of this Section III. may also be subject to injunctive relief under § 25-7-121, C.R.S. (2022). PART D Recordkeeping
I. Covered building owners must maintain the following records for a period of seven (7) years and make records available to the Division or CEO upon request. I.A. ENERGY STAR Portfolio Manager account data in Part B, Section I. I.B. Evidence of requests the covered building owner has made to obtain tenant energy use data from any separately metered spaces in Part B, Section II.
I.G. Any other information included in the building performance standards requirements.
II. Change of ownership II.A. The owner of a covered building must disclose to a prospective buyer prior to the sale of the building the covered building’s compliance status, including compliance with performance targets; any approved waivers, exemptions, extensions, or adjustments; and any penalties assessed. II.B. The owner of a covered building must provide all records specified in Part D, Section I. to the new building owner upon closing.
PART E Penalties I. Beginning January 1, 2024, a covered building owner who does not submit a benchmarking report in accordance with Part B, Section I. or meet the building sale or lease requirements in 25-7-142(6), C.R.S. (2022), is subject to a civil penalty of up to $500 for a first violation and up to $2,000 for each subsequent violation.
II. Beginning January 1, 2024, a covered building owner whose building fails to meet the building performance standards in Part C is subject to a civil penalty of up to $2,000 for a first violation and up to $5,000 for each subsequent violation.
III. Public building owners are not subject to civil penalties under this Part E or under 25-7-122.
PART F Statements of Basis, Specific Statutory Authority and Purpose I. Adopted: August 17, 2023 This Statement of Basis, Specific Statutory Authority, and Purpose complies with the requirements of the Colorado Administrative Procedure Act § 24-4-103, the Colorado Air Pollution Prevention and Control Act §§ 25-7-110 and 25-7-110.5, and the Air Quality Control Commission’s (Commission) Procedural Rules. Basis The Commission adopted a new Regulation Number 28, Building Benchmarking and Performance Standards, to satisfy the requirements the General Assembly in House Bill 21-1286 (Concerning Measures to Improve Energy Efficiency) (HB 21-1286), set forth in § 25-7-142, C.R.S., directing the Commission’s adoption of building benchmarking and performance standards for covered buildings by September 1, 2023. Specific Statutory Authority The Colorado Air Pollution Prevention and Control Act § 25-7-142(7) authorizes the Commission to promulgate rules to implement the benchmarking program established in HB 21-1286. § 25-7-142(8)(c) directs the Commission to adopt rules to establish building performance standards on or before September 1, 2023, “that will achieve a reduction in greenhouse gas emissions of [7%] by 2026 as compared to 2021 levels” and “a reduction in greenhouse gas emissions of [20%] by 2030 as compared to 2021 levels,” as set forth in § 25-7-142(8). § 25-7-105(1)(e) authorizes the Commission to promulgate implementing rules and regulations to abate greenhouse gas (GHG) emissions consistent with the statewide GHG pollution reduction goals in § 25-7- 102(2)(g). In adopting GHG abatement strategies and implementing rules, the Commission is authorized to take into account other relevant laws and rules to enhance efficiency and cost-effectiveness and solicit input from other state agencies and stakeholders on the advantages of different statewide GHG pollution mitigation measures, see §§ 25-7-105(1)(e)(II) and (IV). Implementing rules may include regulatory strategies that incentivize development of renewable resources and “enhance cost-effectiveness, compliance flexibility, and transparency around compliance costs,” see § 25-7-105(1)(e)(V). Further, in promulgating such implementing rules, the Commission is to consider many factors, including, but not limited to, health, environmental, and air quality benefits and costs; the relative contribution of each source or source category to statewide GHG pollution; equitable distribution of the benefits of compliance; issues related to the beneficial use of electricity to reduce GHG emissions; and whether greater or more cost-effective emission reductions are available through program design, see § 25-7-105(1)(e)(VI).
§ 25-7-109(1) authorizes the Commission to adopt and promulgate emission control regulations that require the use of effective practical air pollution controls for each type of facility, process, or activity which produces or might produce significant emissions of air pollutants. An “emission control regulation” may include “any regulation which by its terms is applicable to a specified type of facility, process, or activity for the purpose of controlling the extent, degree, or nature of pollution emitted from such type of facility, process, or activity. . . .”, see § 25-7-103(11). Emission control regulations may pertain to any chemical compound including GHG pollution, see § 25-7-109(2)(c). §§ 24-38.5-112(1) and 24-38.5-112(1)(a) require the Colorado Energy Office (CEO) to implement a building performance program and to use “county assessor records and other available sources of information” to administer the building performance program. § 24-38.5-112(1)(a)(I)-(IV) requires CEO to create a database of covered buildings and of owners required to comply with the building performance program; track compliance with the building performance program; maintain a list of noncompliant owners; and provide the Division a list of noncompliant owners for the Division's enforcement of the building performance program pursuant to § 25-7-122(1)(i). The building benchmarking and performance standards rule was collaboratively drafted by the Division and CEO before it was brought before the Commission. CEO is responsible for the implementation and continuation of the building benchmarking and performance standards requirements while the Division is responsible for enforcement of the rule. Purpose The Commission established building benchmarking and building performance standards (BPS) as one means to track and reduce greenhouse gas (GHG) emissions in the built environment from a 2021 baseline. Buildings constructed after 2021 that would be considered covered buildings under this regulation will also be required to meet the building benchmarking and performance standards. To demonstrate compliance with the BPS, the Commission adopted a flexible, compliance pathway based approach to reducing emissions through improvements in energy efficiency, high- efficiency electrification of space heating and cooling and water heating, or a combined approach that may also include the installation of customer-owned retail distributed generation systems. In adopting the BPS, the Commission considered the recommendations of the Building Energy Performance Task Force (BPS Task Force) convened by the Colorado Energy Office (CEO), as directed by HB 21-1286. Pursuant to § 25-7-142(8)(c)(II), the Commission is, by rule, adopting performance standards that meet the requisite GHG emission reductions.
Applicability New Buildings Buildings constructed after 2021 that would be considered covered buildings under this regulation will also be required to meet the building benchmarking and performance standards. Buildings constructed after 2021 must start collecting benchmarking data once the owner has received a certificate of occupancy for the building. A new building must comply with its applicable building performance target by the specified target date. Public Buildings Public buildings become subject to the building performance standards of this regulation only after undertaking a construction or renovation project that has an estimated cost of at least $500,000 and impacts at least twenty-five percent of the covered building’s square footage. A construction or renovation project that will trigger compliance with the building performance standards either (1) impacts a square footage of twenty-five percent or greater or (2) impacts an area of that size or greater through changes to heating and cooling systems, insulative measures, changes to the building envelope, or other such measures. For purposes of this rule, the “project” shall be the aggregation of any construction or renovation work on a public building that is part of the same bidding process, happens contemporaneously or sequentially within an eighteen month period, or that would otherwise be reasonably considered to be part of or substantially related to the same project.
Public buildings constructed after 2021 that would be considered covered buildings under this regulation will also be required to meet the building benchmarking and performance standards. Public buildings constructed after 2021 must start collecting benchmarking data once the owner has received a certificate of occupancy for the building. Public buildings constructed after 2021 must comply with the building performance standards requirements if the construction has an estimated cost of at least $500,000.
In situations where a public entity shares its building space with other non-public entities, the owner of the covered building, whether the public entity or not, is still required to report benchmarking data. In multi-owner situations, the party responsible for compliance will be the owner listed in the tax assessor’s records for that building and must comply with building performance standards if the covered building has a shared, centralized heating and/or cooling system. If a public entity leases a covered building or a portion of a covered building, the building owner is responsible for compliance with the benchmarking and building performance standards. Whether the public entity may also have some responsibility related to compliance will depend on the lease arrangement between the public entity and the building owner, as with any other owner-tenant situation.
Condominiums and Townhomes § 25-7-142(2)(j)(II)(C) states that “a single-family home, duplex, or triplex” is not a covered building under the building benchmarking and performance standards. Properties such as townhomes and condominiums are similar to single-family homes, duplexes, or triplexes in that the condominium or townhome units within the envelope of a building are individually owned units and may have their own heating and cooling systems. However, condominium or townhome buildings differ from a single-family home in both the energy usage and, thus, the potential opportunity to reduce energy use and associated building greenhouse gas emissions when the condominiums or townhomes share a centralized heating and/or cooling system. Therefore, the Commission determined that condominiums or townhomes that share a building or together comprise a building, are covered under the building benchmarking and performance standards if they have shared centralized heating and cooling systems for water or air conditioning throughout the units of the building. The party responsible for compliance for covered buildings composed of condominiums or townhomes, or any covered building with split ownership, will be the owner listed in the tax assessor’s records for that building whether it be a person, group, organization, or business. Where tax records do not clearly identify a single owner, the person holding themselves out to be the owner or responsible party may be identified through other means. Federal Buildings The Commission has determined that federal buildings are subject to and must comply with the Benchmarking and Reporting Requirements in Part B of this rule. The Commission recognizes that there is currently a Federal Building Performance Standard that establishes 2030 and 2045 goals for reducing emissions from federal buildings. As long as the Federal Building Performance Standard is in effect, federal buildings that would be covered by the Colorado Building Performance should instead comply with the requirements of the Federal Performance Standard. However, the Commission reserves the right to regulate federal buildings in the event that the Federal Building Performance Standard is modified or eliminated.” Benchmarking In Part B, the Commission adopted requirements for owners of covered buildings to submit energy-use benchmarking data. Using benchmarking data to create baseline energy usage allows building owners to track and measure their energy usage in relation to prior years and progress towards performance standard targets established in Part C.
Annual Reporting § 25-7-142(3) requires owners of covered buildings to annually submit, starting June 1, 2024, and by June 1 of each year thereafter, benchmarking data for the previous calendar year to CEO. Buildings constructed after 2021 will be required to submit benchmarking reports starting with the first full year of data after the building has started operating. This data must include all of the applicable building data required by the rule and data quality checks to ensure that the data is correct and accurate. Building owners must also include any change in building information in the annual reporting such as changes to property type or building ownership. Certain building owners may be allowed to benchmark their buildings as a campus if they meet the requirements for campus reporting in Part B. Covered building owners must include in the 2027 benchmarking data report a demonstration that the covered building met the 2026 building performance standard requirements as provided in Part C; the same applies to 2031 reporting with respect to the 2030 building performance standard requirements. Currently, there is no option in the ENERGY STAR® Portfolio Manager for a building to select “marijuana cultivation facility” in the building type field when reporting benchmarking data. CEO has never exempted marijuana cultivation facilities from any reporting requirements. Denver has recently made changes to its program and directed marijuana cultivation facilities to select “manufacturing” in ENERGY STAR® Portfolio Manager when reporting benchmarking data. Consistent with Denver’s program, Regulation Number 28 specifies that marijuana cultivation facilities must report their property type as “manufacturing” in ENERGY STAR® Portfolio Manager and that marijuana cultivation facilities that are covered buildings will be assigned an individualized target for purposes of complying with the building performance standards should the facility owner choose not to comply with the standard percent reduction compliance pathway. To avoid confusion, the definition of “manufacturing purpose” explicitly excludes these facilities for the purpose of the exemption from the definition of “covered building” in Section III.O.2.
Waivers, Extensions, and Exemptions § 25-7-142(5) allows covered building owners to seek a waiver or time extension from the annual benchmarking requirement for a given year if the owner submits waiver documentation to, and receives approval from, CEO. Building owners eligible for the 2021 benchmarking waiver will automatically be assigned an energy-use intensity (EUI) target. A covered building owner may also request a benchmarking time extension from CEO if the owner submits documentation to CEO demonstrating that, despite the owner's good-faith efforts, the owner was unable to complete the benchmarking report for the relevant year. This allows the building owner more time to aggregate their building’s benchmarking data so they can submit at a later date. Covered building owners must submit a waiver application to CEO any time after June 1 of the calendar year to be benchmarked and on or before May 1 of the reporting year, unless CEO adopts an alternate timeline for submitting a waiver application. The Commission also adopted provisions for building owners to seek an exemption from CEO if the building does not meet the definition in § 25-7-142(2)(j) of a covered building (i.e., storage facilities, stand-alone parking garages, or airplane hangars that lack heating and cooling; buildings with more than half of the gross floor area used for manufacturing, industrial, or agricultural purposes). The adoption of these exemption provisions recognize that building uses may change over time and that building owners may want documented clarity of whether or not the building is subject to the benchmarking requirements.
Building Performance Standards (BPS)
Building performance standards create energy performance targets, such as a specific level of energy usage or reduction for buildings to meet after a set amount of time. These standards help drive energy efficiency improvements and reduce energy use and resulting GHG emissions over the course of implementation. BPS Task Force Recommendations Pursuant to § 25-7-142(8)(a), CEO convened the BPS Task Force to develop recommendations for the Commission to consider when adopting rules for building performance. CEO timely delivered the BPS Task Force recommendations to the Governor’s Office, General Assembly, and Colorado Department of Public Health and Environment by October 1, 2022, consistent with § 25-7-142(8). The recommendations made by the BPS Task Force, and included in the report, were approved by two-thirds of the BPS Task Force members. These recommendations are available on the Colorado Energy Office’s (CEO) Building Performance Standards website under the Task Force Recommendations.
In developing the recommendations, the BPS Task Force was comprised of members with experience from a broad range of industries and building owners; examined building types of unique energy needs including aviation facilities, nursing homes, and hospitals; and considered how the performance standards and the greenhouse gas reductions would not include savings from statewide decarbonization of electricity or natural gas utility grids but include savings from utilities' or local governments' energy efficiency programs.
The BPS Task Force also made recommendations related to workforce availability and development related to building energy performance; financial and nonfinancial costs and benefits of upgraded building energy performance; availability of programs, technical assistance, and incentives to support building owners, utilities, and local governments; opportunities to improve commercial building energy use in Colorado; how regulations and agency support could help ensure building owners avoid fines through compliance with performance standards.
Rule Design and GHG Emissions Reductions Enacting a building performance regulation to reduce GHG emissions ensures that large building owners participate in the reduction of emissions from the built environment. Building energy usage and GHG emissions are correlative, which allows for building performance standards to influence consumer decisions and therefore induce reductions of statewide building emissions. The Commission adopted building performance standards that will require covered buildings to implement measures that, taken together, are expected to achieve GHG emission reductions from this segment of covered buildings in the building sector of 7% by 2026 and 20% by 2030, as compared to 2021 levels. Based on benchmarking data reporting 2021 data in 2022, covered buildings subject to these rules were responsible for approximately 8,878,000 metric tons of carbon dioxide equivalent emissions resulting from the energy consumption of those buildings.
Pursuant to § 25-7-142(8)(c)(II), the Commission adopted performance standards to meet the requisite GHG emission reductions. In calculating the statewide GHG emission reductions anticipated to result from these regulations, the changes in emissions are not separate from those realized by the utilities as part of the statewide GHG inventory. This overlap in emissions impacts is recognized in § 25-7-142(8)(a)(IV), which directs that “[i]n calculating greenhouse gas reductions pursuant to § 25-7-42(8), the calculation must not include savings from statewide decarbonization of electricity or natural gas utility grids, but may include savings from utilities' or local governments' energy efficiency programs.” Thus, while these rules are anticipated to drive GHG emission reductions to meet the targets, it is important to note that these reductions will not be independently reflected in the statewide GHG inventory but rather as one means of reducing emissions attributable to energy consumption by driving down demand and consumption of carbon-intense energy sources. It is also important to note that the greenhouse gas targets from § 25-7-142(8)(a)(II)(A) and § 25-7-142(8)(a)(II)(B) must be adjusted to account for the addition of future building stock. Factoring the increase of new building stock into the greenhouse gas emissions targets means that the initial targets would need to be increased from 7% by 2026 and 20% by 2030 to 9.6% by 2026 and 23% by 2030.
Accordingly, the compliance pathways provided for in Part C are designed to provide owners of covered buildings flexibility in compliance based on the unique characteristics of each individual building while also ensuring that overall compliance will accomplish the GHG emissions reduction targets in § 25-7-142(8)(a)(II)(A) and § 25-7- 142(8)(a)(II)(B). The building performance standard requirements adopted by the Commission allow for different metrics to be measured against a 2021 baseline so that progress can be tracked and compared to the GHG emission reduction targets. Owners of covered buildings must meet and maintain compliance with the 2026 targets each year from 2026 through 2029 until the covered buildings must meet and maintain the 2030 targets. Owners of covered buildings must meet and maintain compliance with the 2030 targets each year from 2030 on until future targets are established for beyond 2030.
Compliance Pathways In Part C, Sections I.A. and I.B., the Commission adopted two compliance pathways for covered building owners to comply with performance standards: energy efficiency and greenhouse gas reductions. Improving energy efficiency is the preferred compliance pathway. This compliance pathway requires building owners to implement energy efficient changes or upgrades to their buildings to reduce the building’s EUI to meet the building’s assigned weather normalized site EUI target. Improving site EUI reduces GHG emissions by reducing demand for gas and electric service and, therefore, reducing the emissions from the generation or consumption of that energy. In Part C, Table 1, the Commission established weather normalized site EUI by property type that covered buildings are to achieve by 2026 as an interim performance standard, pursuant to § 25-7-142(8)(a)(II). The 2026 weather normalized site EUI targets in Table 1 were determined to represent a 7% reduction in GHG emissions across covered buildings as compared to the baseline, after accounting for growth of new construction, established through the 2021 benchmarking data collected and analyzed by CEO. The 2030 weather normalized site EUI targets in Table 1 were determined to represent a 20% reduction in GHG emissions across covered buildings as compared to the baseline, after accounting for growth, established through the 2021 benchmarking data collected and analyzed by CEO.
In Part C, Section I.A.3., the Commission adopted a standard percent reduction compliance pathway option to the energy efficiency compliance pathway that allows covered buildings to meet and maintain fixed EUI reductions by the 2026 and 2030 compliance periods. Buildings complying with the energy efficiency standard percent reduction compliance pathway must reduce their EUI by 13% in 2026 and by 29% by 2030 from their 2021, or first reporting year, benchmarked baseline weather-normalized EUI.
For existing buildings that did not submit a 2021 benchmarking report, the building will be subject to the weather normalized EUI target for the property type as identified in tax records that was established as the average of the data submitted by the similar building types. In calculating site EUI targets, where sufficient data for a particular building type was lacking in the 2021 benchmarking baseline, other national and local building energy data sets, such as ENERGY STAR and the Commercial Buildings Energy Consumption Survey (CBECS), were used to determine the EUI target for that property type. Under this compliance pathway, buildings constructed after 2021 must also comply with their property type EUI target. If a new building is unable to provide benchmarking data, the building will be assigned a EUI target for the property type as identified in tax records based on similar property types that benchmarked their data or from the Commercial Buildings Energy Consumption Survey (CBECS). The demonstration of compliance with the energy efficiency compliance pathway will be completed through the ENERGY STAR® Portfolio Manager tool that will provide a building owner with a covered building’s weather-normalized site EUI. Under Part C, Section I.B., a covered building unable to achieve the required GHG emission reductions through the compliance pathway of energy efficiency may achieve the required GHG emission reductions and demonstrate compliance individually or through a combination of energy efficiency, electrification, and/or the use of customer- owned retail distributed generation systems to offset grid-based electricity. Electrification requires covered building owners to replace or avoid fossil fuel-based space heating, water heating, or cooking equipment by using high efficiency electric equipment. High efficiency electric equipment means using electrical equipment with less required energy to perform the same function by eliminating energy waste. For example, high-efficiency electric equipment may be certified according to ENERGY STAR, meet Federal Energy Management Program (FEMP) efficiency requirements, meet the current version of American Society of Heating, Refrigerating and Air- Conditioning Engineers’ (ASHRAE) Standard 90.1 or IECC 2021 International Energy Conservation Code (IECC), or meet newer such requirements. Electrification also reduces emissions by shifting fossil fuel-based building end-uses to the electrical grid, which is a lower-emitting energy supply source that will achieve deeper emissions reduction as the grid is progressively supplied by greater amounts of renewable energy. The Commission encourages the building owner to coordinate and communicate with their utility provider if the building is planning on implementing full or significant electrification of the building.
In Part C, Section I.B.2., the Commission adopted a standard percent reduction compliance pathway option to the GHG intensity reduction compliance pathway that allows covered buildings to meet and maintain fixed GHG intensity reductions by the 2026 and 2030 compliance periods. Buildings complying with the GHG intensity standard percent reduction compliance pathway must reduce their GHG intensity by 13% in 2026 and by 29% by 2030 from their 2021, or first reporting year, benchmarked baseline that has been converted to a GHG intensity value. Building owner’s choosing to use the GHG intensity standard percent reduction compliance pathway will calculate their building’s baseline year emissions and their 2026 and/or 2030 emissions using the ENERGY STAR® Portfolio Manager’s Building Emissions Calculator and apply a Colorado-specific emission factor for electricity use in the calculator for the baseline year and years 2023 to 2026 and a separate Colorado-specific emission factor for the baseline year and years 2027 and beyond, and compare the difference between the baseline year calculation and the target year calculation to determine the percent reduction. Both of these emission factors reflect the statewide decarbonization of the electricity utility grid and ensures that the building’s 2021 baseline and 2026 and/or 2030 reductions reflect the same status in grid decarbonization. Customer-owned retail distributed generation allows a building to develop renewable resources to reduce use of grid-based energy and therefore reduce some portion of the building’s emissions; however, the use of renewable resources may only be used as a compliance mechanism after the covered building owner has exhausted other options. A covered building owner using distributed generation must demonstrate ownership or long-term control of the resource for covered building owners that choose the GHG intensity compliance pathway. The following forms of retail distributed generation recognized under 40-2-124(1)(a)(VIII) are eligible for compliance after demonstrating in an energy audit that a building owner has maximized the economic use of energy efficiency and electrification and exhausted cost-effective compliance measures for the covered building.
Other forms of renewable energy may be considered in the compliance pathway in consultation with CEO. For example, using wastewater thermal energy recovery systems may result in a reduced energy usage for the building that would be reflected in the building’s benchmarking data and GHG emissions but not as a REC. Similarly, a demand response or demand flexibility program may be considered as a means to reduce a covered building’s overall EUI, so long as there is adequate information to demonstrate the reduction in GHG emissions. The building benchmarking and performance standards overall goal is to lower a building’s greenhouse gas emissions and other forms of renewable generation or recovery can allow a building to do that by reducing reliance on other forms of emissions-generating sources for a building even if the renewable generation or recovery is not directly accounted for in the benchmarking tool. CEO will work with the Division and stakeholders when considering other programs and emerging technologies that can be used to reduce the EUI and/or greenhouse gas emissions of buildings in the future.
In order to demonstrate compliance with the GHG emissions reduction compliance pathway, building owners must use the ENERGY STAR® Portfolio Manager’s Building Emissions Calculator and report the results for a covered building from the calculator. The reporting must be accomplished by downloading the results from the calculator in a spreadsheet (.xlsx) file that is submitted to CEO. If utilizing electrification to demonstrate compliance through this compliance pathway, the applicable 2023 through 2026 or 2027 and beyond Colorado-specific emission factor for electricity must be used and will be specified in the calculator. The U.S. Environmental Protection Agency (EPA) operates both ENERGY STAR® Portfolio Manager and the Building Emissions Calculator, which are currently separate tools, but these tools are able to work together. However, EPA is planning to integrate the functionality of the Building Emissions Calculator directly into ENERGY STAR® Portfolio Manager at which point calculations of a covered building’s GHG emissions for demonstrating compliance with the GHG emissions reduction compliance pathway may be completed using the calculator functionality in ENERGY STAR® Portfolio Manager and its associated reporting function. In Part C, Table 1, the Commission established greenhouse gas emission targets by property type for this compliance pathway that covered buildings must achieve by 2026 and 2030, pursuant to § 25-7-142(8)(c)(II). The 2026 greenhouse gas emission targets in Table 1 were determined to represent a 7% reduction in GHG emissions as compared to the baseline, accounting for growth, established through the 2021 benchmarking data collected and analyzed by CEO. The 2030 greenhouse gas emission targets in Table 1 were determined to represent a 20% reduction in GHG emissions as compared to the baseline, accounting for growth, established through the 2021 benchmarking data collected and analyzed by CEO.
In Part C, Sections I.C. and I.D., the Commission adopted processes for the establishment of individual targets for certain categories of covered buildings, specifically mixed use buildings as defined in Part A, Section III.DD., data centers, buildings with installed electric vehicle (EV) charging stations that are not able to be sub-metered, and marijuana cultivation facilities. At the time of rule adoption, the Commission did not have data available to establish property type targets for these buildings in Table 1 that would enable compliance with energy efficiency of greenhouse gas intensity reduction pathways. Mixed use buildings may identify a primary property type in ENERGY STAR® Portfolio Manager where one property type accounts for more than 50% of the building’s gross floor area. However, due to the variety of potential energy needs of the different property types represented in the building, CEO will assign an individualized target to every mixed use building as defined in Part A, Section III.DD. that does not use the standard percent reduction compliance pathway. The individualized target will be based on the percentage of gross floor area assigned to each property type in the building and other factors detailed in Part C, Section I.D. CEO will use each building’s ENERGY STAR® Portfolio Manager benchmarking report to track compliance with these individualized targets.
Data centers will be assigned a power usage effectiveness (PUE) target, due to the unique energy needs of such buildings. CEO will only assign stand-alone data centers a PUE target, as outlined in Part C, Section I.C. Mixed use buildings that include a data center will be assigned an individualized target pursuant to Part C, Section I.D. Buildings with EV charging stations that are not able to be sub-metered will be assigned a target representative of the building’s energy use minus the EV charging station energy use. EPA is planning to add functionality to ENERGY STAR® Portfolio Manager for building owners to exclude the energy use of EV charging stations, which would allow both a recalculation of the building’s 2021 baseline and future reporting to exclude EV charging station energy use via reporting rather than through the individualized target process. Electricity used for EV charging, regardless of whether it is sub-metered, is intended to be excluded from energy use by covered buildings under this program. Lastly, as discussed above, marijuana cultivation facilities will select the property type of manufacturing in ENERGY STAR® Portfolio Manager. However, because a manufacturing property type target may not be appropriate for such facilities, CEO will assign an individualized target at the facility owners’ request for each marijuana cultivation facility based on the facility’s gross floor area and energy usage. As with mixed use buildings, data centers, marijuana cultivation facilities, and covered buildings with EV charging are also not limited from complying the compliance pathways in Part C, Sections I.A. or I.B.
The BPS Task Force recommendations suggested consideration of the possibility of demand response/flexibility as an additional compliance pathway to help achieve the GHG emission reductions because the technologies shift the building’s energy demand to non-peak times. Grid-interactive efficient buildings are energy efficient buildings that use smart technologies, batteries, and on-site distributed energy resources to provide demand flexibility while co-optimizing for energy cost, grid services, and occupant needs and preferences in a continuous and integrated way. At the time these rules were adopted, there was insufficient infrastructure and no standardized industry methodology for measuring a building’s demand response/flexibility capabilities to support demand response/flexibility as a compliance pathway. However, the Commission recognizes the value in demand response/flexibility integration in buildings to better control building energy use and encourages the continued investigation into potentially crediting covered buildings for the use of these programs in the future. Compliance Adjustments Under Part C, Section II., when a covered building cannot achieve compliance with the building performance standards through the compliance pathways, the Commission adopted a process by which the covered building owner may request timeline and/or performance target adjustments. Section II. provides examples of circumstances under which a covered building owner may apply for a compliance adjustment. The following provides some demonstrative context for those requirements. • “Cost prohibitive” refers to the steps that a building owner would need to take to demonstrate the cost of compliance is higher than the benefit. If the equipment has a resale/salvage value, the cost of that equipment is the upfront cost minus the salvage value. If the buyer has obtained incentives (utility, local, state, or federal) for buying the equipment, then the cost of the equipment is further reduced by the amount of the incentive received. The cost of installing the equipment and the cost of its upkeep during its useful life are then added to that cost figure to determine the overall cost of the equipment.
The benefits of installing the equipment include reduced energy use and reduced emissions. The dollar amount of that energy savings is determined by multiplying the amount of energy saved by the price of energy of the applicable fuel as forecasted by the U.S. Energy Information Administration for the target year of compliance plus anticipated demand response savings.
The social cost of greenhouse gases are the most recent assessment of the social cost for those greenhouse gases for which the federal government has determined the cost. However, it cannot be below the figure set in 2016 using a two and one-half percent discount rate as established by the federal interagency working group on the social cost of carbon. The dollar value of emission reduction is determined by multiplying the amount of emission reduction in metric ton of carbon dioxide equivalent by the social cost of greenhouse gases. The total benefit associated with installing equipment is, thus, determined by adding the dollar amounts of energy savings and of emission reduction using the social cost of greenhouse gases.
Whereas some of the costs and benefits are obtained in the year the equipment is installed, the rest occur over the useful life span of that equipment. Because benefits/costs that occur in the future are not valued the same way as benefits/costs that occur in the year of investment, those figures have to be discounted so that their present value equivalents can be determined. If the equipment has a two-year useful life, any benefit/cost that is incurred in the second year is discounted using the following formula:
In addition, a covered building utilizing a novel alternative emissions reduction technology, such as carbon capture, could qualify under the compliance adjustment provisions as its operations would have a significant variation from other buildings through use of such a technology. Part C, Section II. provides an avenue for consideration of other alternative reduction technologies such as carbon capture through the adjusted performance target provisions. Specifically, Section II.B.3.b. allows “covered buildings with significant variations in operations from a standard building in that building type category” to apply for an adjusted target. Buildings seeking a compliance adjustment under Part C, Section II., must have an energy audit performed on the building to demonstrate why the building was unable to reach compliance. The energy audit must follow the requirements in the United States Department of Energy’s Building Energy Audit Template, ASHRAE’s standard 211-2018 or more current level 2 audit, or an energy audit of similar requirements approved by CEO. All energy audits submitted for compliance adjustments must be performed by an accredited third-party auditor. Examples of acceptable energy auditor certifications are Certified Energy Auditor (Association of Energy Engineers), Certified Energy Manager (Association of Energy Engineers), Building Energy Assessment Professional (ASHRAE), Energy Management Professional (Energy Management Association), Multifamily Building Analyst (Building Performance Institute), or other energy auditor accreditations or certification recognized or deemed equivalent by the United States Department of Energy. The EUI target adjustment request must also include an inventory of all existing air and water heating and cooling equipment and an inventory of all required equipment needed to meet the building’s assigned EUI or emission target. In approving adjustments, CEO may consider standard target adjustments based on the Environmental Protection Agency (EPA) suggested methods in addition to the other factors outlined in the target adjustment process in Part C, Sections II.B. and II.C. Certain covered buildings in Denver receive steam from the Denver District Steam System for a variety of purposes, including space heating, use in steam radiators, and heating domestic hot water. At the time of this rulemaking, the Denver District Steam System was subject to a proceeding before the Colorado Public Utilities Commission (Proceeding Number 22A-0382ST) regarding the operations of the system through 2030 and consideration of alternate technologies to replace the system. Acknowledging this uncertainty and its potential impact on large capital investments, the Commission recognizes that covered buildings on the Denver District Steam System may qualify to apply for either a timeline or performance target adjustment. However, any such adjustment would need to be substantiated in accordance with Part C, Section II. and would be at the discretion of CEO.
Penalties Pursuant to § 25-7-122(1), the Commission adopted civil penalty provisions related to a covered building owner’s failure to comply with the benchmarking and building performance standards requirements. § 25-7-122(1) specifies values of $2,000 for a first violation of the performance standards and $5,000 for a second violation. In addition to these provisions, the Commission adopted additional reporting and compliance demonstration requirements for building owners that fail to comply with the building performance standards, clarifying that building owners must demonstrate progress until coming into compliance and that failure to do so may result in a finding of additional violations. The Commission expects that the potential for these additional penalty assessments will further incentivize covered building owner compliance. Utility Data Reporting § 25-7-142(4) contains statutory requirements incumbent upon qualifying utilities concerning the collection and provision of energy-use data for its customers, including covered building owners and tenants. Both the definition of “qualifying utility” at § 25-7- 142(2)(u) and the duties created under § 25-7-142(4) are explicit and clear. These provisions are enforceable as a provision of part 1 of the Act by the Commission and Division under § 25-7-115. Furthermore, qualifying utilities providing electric service are subject to extensive data gathering and provision requirements in the Colorado Public Utilities Commission's (PUC) Rules Regulating Electric Utilities at 4 CCR 723-3, Sections 3025 - 3035 concerning “Customer Data Access and Privacy.” Under these PUC rules, customers may request the release of this information through the Consent to Disclose Utility Customer Data form. Given these preexisting statutory and regulatory duties governing this conduct, the Commission did not adopt any additional rules in this regard.
Sale and Lease of Covered Buildings § 25-7-142(6) contains statutory requirements dependent on the sale or lease of buildings covered under the building performance standards. If a covered building or a portion of a covered building is for sale or lease, the covered building owner must provide an electronic copy of the building’s reported benchmarking data to all prospective buyers or lessees, any brokers as defined in § 12-10-201(6) C.R.S., any person making an inquiry about the property, or any major commercial real estate listing services on which the property is listed. The benchmarking data should be of the building’s previous calendar year or from the most recent twelve-month period of continuous occupancy. If a covered building changes ownership, the former owner must make available to the new owner the energy-use data, utility customer consent documentation, and any other information about the property that is necessary to benchmark the covered building. The former owner must transfer to the new owner both the record representing the covered building’s information in the benchmarking tool and the request to a qualified utility for aggregated data. The new owner may request and receive from a qualifying utility the aggregated data necessary to fulfill benchmarking reporting requirements. Given these preexisting statutory and regulatory duties governing this conduct, the Commission did not adopt any additional rules in this regard.
Future Year Standards § 25-7-142(8)(a)(II)(C) granted the BPS Task Force the opportunity to provide recommendations for “advising, soliciting public input on, and making recommendations to the commission on performance standards for 2030 to 2050” that will align with the State’s 2050 GHG reduction targets. The Commission understands that CEO will continue to evaluate submitted benchmarking data as well as compliance demonstrations to evaluate implementation and performance under this regulation and encourages CEO to consider convening a new task force to evaluate potential future revisions to these standards as well as to evaluate additional building performance standards beyond 2030.
The CEO will report to the Commission on the implementation of Regulation Number 28 on a regular basis. The report may include information on benchmarking reporting statistics, benchmarking waivers and exemptions, the number of requests for adjustments received and the number of adjustments granted, and other information regarding program implementation. The Division will also report to the Commission on the implementation of Regulation Number 28 on a regular basis to provide updates on progress towards meeting the 2026 and 2030 targets, penalties, and any other information regarding program implementation.
The Colorado Department of Public Health and Environment will undertake future rulemakings as needed after evaluating implementation of the rule and its effectiveness in achieving statutory greenhouse gas emission reduction targets, and make needed improvements, including in 2027 or early 2028 as informed by the compliance data for the 2026 targets.
Finally, the Commission recognizes that Regulation Number 28 is a new program and will apply to many entities that have not previously been subject to rules promulgated by the Commission. Throughout this rule, language has been developed to ensure that this rule provides reasonable flexibilities and is cost-effective for owners of covered buildings, including approving, where appropriate, adjustments to performance targets and timelines which may extend beyond 2030, while simultaneously ensuring that the state will meet the targets established in § 25-7- 142(8)(c). Federal vs. State-Only Conditions (if applicable)
The revisions to Regulation Number 28 do not exceed or differ from the requirements of the federal act or rules, therefore, 25-7-110.5(5)(a) does not apply. Findings of Fact (I) These rules are based upon reasonably available, validated, reviewed, and sound scientific methodologies, and the Commission has considered all information submitted by interested parties.
(II) Evidence in the record supports the finding that the rules shall result in a demonstrable reduction of greenhouse gasses related to building performance.
(III) Evidence in the record supports the finding that the rules shall bring about reductions in risks to human health and the environment that justify the costs to implement and comply with the rules.
(IV) The rules are the most cost-effective to achieve the necessary and desired results, provide the regulated community flexibility, and achieve the necessary reduction in air pollution.
(V) The rule will maximize the air quality benefits of regulation in the most cost- effective manner.
II. Adopted: September 17-19, 2025 This Statement of Basis, Specific Statutory Authority, and Purpose complies with the requirements of the Colorado Administrative Procedure Act 24-4-103, the Colorado Air Pollution Prevention and Control Act 25-7-110 and 25-7-110.5, and the Air Quality Control Commission’s (Commission) Procedural Rules.
Basis In 2023, the Commission adopted a new Regulation Number 28, Building Benchmarking and Performance Standards, to satisfy the requirements the General Assembly in House Bill 21-1286 (Concerning Measures to Improve Energy Efficiency) (HB 21-1286), set forth in Section 25-7-142, C.R.S. In this rulemaking, the Commission adopted technical corrections.
Specific Statutory Authority The Colorado Air Pollution Prevention and Control Act Section 25-7-142(7) authorizes the Commission to promulgate rules to implement the benchmarking program established in HB 21-1286. Section 25-7-142(8)(c) directs the Commission to adopt rules to establish building performance standards on or before September 1, 2023, “that will achieve a reduction in greenhouse gas emissions of [7%] by 2026 as compared to 2021 levels” and “a reduction in greenhouse gas emissions of [20%] by 2030 as compared to 2021 levels,” as set forth in Section 25-7-142(8). Section 25-7-105(1)(e) authorizes the Commission to promulgate implementing rules and regulations to abate greenhouse gas (GHG) emissions consistent with the statewide GHG pollution reduction goals in Section 25-7-102(2)(g). Section 25-7-109(1) authorizes the Commission to adopt and promulgate emission control regulations that require the use of effective practical air pollution controls for each type of facility, process, or activity which produces or might produce significant emissions of air pollutants. Section 25-7- 106(6) authorizes the Commission to require owners or operators of air pollution sources to monitor, record, and report information.
Purpose The Commission established building benchmarking and building performance standards (BPS) as one means to track and reduce greenhouse gas (GHG) emissions in the built environment. As part of the rulemaking in 2023, the Commission expanded the provisions related to utility subscription services to all covered buildings in Part C, Section I.B.1., instead of just under-resourced buildings. However, the Commission’s decision on this point was not reflected in the final regulatory language or the adopted Statement of Basis and Purpose at the conclusion of the rulemaking hearing and as submitted to the Secretary of State for publication. Therefore, the Commission now adopted a technical correction to align the language in Section I.B.1.d. with the language in Section I.B.1., as the Commission intended, and clarifies that the Commission’s recognition of the need for additional flexibility as related to utility subscription services as a compliance measure applies to all covered buildings and not just under-resources buildings.
The Commission revised the definition of covered building to exempt agricultural buildings, to align with SB 25-039.
The Commission also revised the date under which the annual fee is required to November 1 of each year, starting in 2026. HB 21-1286, in Section 24-38.5-112, C.R.S., specifies that each covered building owner must pay an annual fee of $100 per covered building. However, HB 21-1286 did not specify the deadline for collecting this fee. Prior to this revision, the fee was due by June 1. The Commission revised the date to November 1 to align with pending legislation in HB 25-1269. Further, these revisions include any typographical, grammatical, and formatting errors throughout the regulation.
Federal vs. State-Only Conditions (if applicable)
The revisions to Regulation Number 28 do not exceed or differ from the requirements of the federal act or rules, therefore, 25-7-110.5(5)(a) does not apply. Findings of Fact (I) These rules are based upon reasonably available, validated, reviewed, and sound scientific methodologies, and the Commission has considered all information submitted by interested parties.
(II) Evidence in the record supports the finding that the rules shall result in a demonstrable reduction of greenhouse gasses related to building performance.
(III) Evidence in the record supports the finding that the rules shall bring about reductions in risks to human health and the environment that justify the costs to implement and comply with the rules.
(IV) The rules are the most cost-effective to achieve the necessary and desired results, provide the regulated community flexibility, and achieve the necessary reduction in air pollution.
(V) The rule will maximize the air quality benefits of regulation in the most cost- effective manner.
Editor’s Notes History New rule eff. 10/15/2023.
Rules Part A, III O.2, III O.4, IV A, Part C, I B.1.d, I B.1.d(i), 1 B.1.d(ii), II F, Part F II eff. 11/14/2025.