De La Rosa said she introduced the bill to ensure the benefits of Local Law 97 flow to the city’s residents, especially those in marginalized communities.
“Climate change is already affecting us,” De La Rosa said. “In recent years, we’ve seen major brush fires in my district. Communities of color and environmental justice communities are bearing the impacts.”
Several climate organizations signed a memo in support of De La Rosa’s bill, and note that Mamdani could also enact an offset limit through rulemaking at the Department of Buildings.
The department formalized the use of RECs as a compliance option in 2022, under then-Mayor Adams. “Eric Adams ripped a giant loophole into Local Law 97,” said Pete Sikora, who directs climate advocacy at New York Communities for Change. Closing that loophole “would ensure energy efficiency investments that lead to thousands of jobs, millions of tons of air pollution reductions, and lower utility bills,” he said.
But not everyone sees the RECs as a handout to property owners. Because they provide revenue to energy developers, they can also spur energy investment, said Ben Furnas, a former top climate official in the Bill de Blasio administration.
“I think CHPE is a huge victory for Local Law 97 in a lot of ways,” he said, since its RECs can “help catalyze a political coalition for a much lower emission grid.”
Another alum of the de Blasio climate team, Daniel Zarrilli, said it would have been hard to fund the transmission line without it.
“CHPE actually getting built was far from guaranteed,” Zarrilli said. “If part of the tradeoff was allowing some offsetting of electricity emissions, I think that was a worthwhile compromise.”
The sale of RECS will help defray some of the cost of building and operating the transmission line, which otherwise will be absorbed by ratepayers across the state. In a statement, the Department of Buildings said purchasing RECs “cuts down on pollution and supports a cleaner grid for our city.”
New York City itself has already committed to buying a substantial portion of RECs. Utility customers will see their monthly bills rise by a few dollars per month to help pay for CHPE; the exact amount may vary slightly, depending how many RECs building owners buy.
Most large buildings are already in compliance with the law’s earliest requirements. By the time stricter requirements take effect in 2030, RECs may well be more expensive. Their prices fluctuate each month — rising when power prices are low and decreasing when power prices are high. Starting in 2030, the law starts to treat New York City’s electricity as much cleaner, anticipating the grid’s continued shift towards carbon-free energy sources. At that point, building owners will have to buy twice the number of RECs to cover the same amount of emissions.
Halfnight said the shifting calculus of REC prices could eventually help encourage building owners to actually lower their properties’ emissions rather than relying on the offsets. In the meantime, he said, a cap on the RECs would provide a “straightforward fix.”
“These countervailing factors say ‘OK, it’s some risk, but it’s not a five-alarm fire,’” he said.
