Energy Efficiency Compliance Notices sent to Washington Multifamily Owners (7/1/25)
The State of Washington Department of Commerce is mailing notices to multifamily owners of assets larger than 20,000 square feet that they are subject to the state’s Clean Buildings Performance Standard.
The purpose of the 2019 law is explicitly to reduce greenhouse gas emissions by lowering energy consumption in existing covered buildings, multifamily buildings, and campus facilities. The standard focuses on energy efficiency and reducing fossil fuel consumption to achieve significant reductions in pollution and cost savings.
HFO compiled the following fact sheet from an analysis of the state’s 134-page “Clean Buildings Performance Standard” report, along with a copy of a recent notice and related documents from the Washington Clean Building Performance Standard website.
HFO will publish a paper with easy-to-follow step-by-step instructions next week! Watch this space.
Fact Sheet for Multifamily Housing Stakeholders
Overview
The Washington Clean Buildings Act of 2019 mandates energy performance standards designed to reduce greenhouse gas emissions from buildings, which contribute to 27% of Washington’s total emissions. Originally targeting commercial buildings exceeding 50,000 square feet, the Act expanded in 2022 to include multifamily properties exceeding 20,000 square feet.
The Clean Buildings Performance Standard (CBPS) aims to reduce energy consumption, thereby lowering long-term operating costs and minimizing environmental impact. Concerns have emerged regarding the implications of costs and housing affordability.
Compliance Requirements
Multifamily properties above 20,000 sq. ft. must meet Tier 2 compliance by July 1, 2027. Required actions include:
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Benchmarking energy use via EPA’s Energy Star Portfolio Manager.
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Create an Energy Management Plan that outlines strategies for reducing energy consumption. [Although the notice also says “Tier 2 covered buildings do not have to meet an energy target.“]
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Implementing an Operations & Maintenance (O&M) Plan for efficient building systems management.
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Conducting an energy audit (e.g., ASHRAE Level 2), identifying and executing cost-effective upgrades (HVAC, lighting, insulation, etc.) to meet Energy Use Intensity (EUI) targets.
The formal compliance documentation must be submitted to the Clean Buildings Portal by July 1, 2027.
Costs, Penalties, and Support
Compliance Costs
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The average compliance-related costs are $4.50 per square foot, excluding capital upgrades.
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A significant investment may be necessary, with potential costs for older, inefficient buildings ranging from hundreds of thousands to millions of dollars.
Penalties for Noncompliance
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Initial penalty up to $5,000 per building.
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Additional annual fines of $1 per sq. ft. until compliance is met.
State and Utility Incentives
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Early Adopter Incentive: $0.30 per sq. ft. for Tier 2 buildings complying ahead of schedule.
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Utility Programs (Puget Sound Energy, Seattle City Light): Free coaching, training, benchmarking support, and rebates.
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Commerce Support: Guidance documents, training videos, and helpdesk services.
Exemptions and Extensions
Certain exemptions exist for:
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Federally owned and tribal buildings are eligible for exemptions.
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Buildings facing severe financial distress (foreclosure, receivership).
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Specific cases include public schools, hospitals, and historic buildings as defined by recent legislation (HB 1543, 2023).
Owners can apply for exemptions starting July 1, 2025, but they must do so no later than 180 days prior to the application deadline.
Questions? For assistance, please email buildings@commerce.wa.gov or open a customer support ticket.
Additional Resources*
Directory of Qualified Persons to Assist
Directory of Qualified Energy Auditors
Additional Recommendations
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Proactively budget for costs related to compliance and necessary capital upgrades.
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Leverage state, utility, and local support programs and incentives.
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Evaluate potential exemptions or extensions that may be available if your organization is facing financial or operational difficulties.
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Please ensure that you engage with policymakers and regulators to express your concerns or suggest practical policy adjustments.
*Links provided by the State of Washington Department of Commerce Website Dashboards
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