BPS vs Benchmarking: What’s the difference?

We get it, it is confusing.  You have markets that have Building Performance Standards (BPS) and you have markets that have compliance benchmarking.  Do you do one and not the other?  Do they occur at the same cadence?  Do they have the same due dates?  Is what is included in the benchmark part of the BPS and vice versa?  

Think of benchmarking as a gateway requirement to BPS.  Currently, there are 59 jurisdictions that require a compliance benchmark and of those areas, there are 46 members of the National Building Performance Standards (BPS) Coalition that released BPS policies and programs by Earth Day 2024. For both benchmarking and BPS policies, jurisdictions are requiring that building owners use Energy Star Portfolio Manager to report usage and emissions. 

What is Benchmarking?

Benchmarking is the process of understanding your building’s current performance in the context of resource usage, such as energy and water, and the greenhouse gas (“GHG”) emissions associated. Benchmarking typically serves as a baseline performance to compare future performances in order to track progress towards an emissions or usage reduction goal. 

When required, benchmarking is completed using Energy Star Portfolio Manager (“ESPM”) which was created by the EPA specifically to help owners track their building(s) energy usage, water usage, and GHG emissions. Benchmarking requires at least 12 months of consecutive data and typically whole building data which can be acquired from your utility provider. You will be required to indicate whether or not the data encompasses the whole building or just portions of it (common areas, lobbies, hallways, etc.).

However, while the data is still used as a baseline, benchmarking policies often require the usage and emissions data to be reported in order for jurisdictions to understand their current state of building impacts. This data can be used to create goals or BPS policy for attainable limits and a transparent goal of emissions reduction through the building sector. Benchmarking is often required at the property level and if you have multiple buildings on your property, you may select this when setting up the property for benchmarking. Each building can then have its own meter with energy usage data within a property.

What is BPS?

BPS policies require both benchmarking and emissions or energy usage limits. GHG emissions in a building are primarily related to the energy usage in a building. Non renewable energy generation emits emissions, both onsite such as natural gas combustion, or offsite such as purchasing electricity from the grid where emissions come from the production source such as a power plant. BPS policies limit a building’s energy usage (to reduce its associated emissions) and/or the greenhouse gas emissions itself to reduce a jurisdiction’s building related GHG emissions. In order to comply with the regulation, your building must be at or below the limit set by the jurisdiction, and failure to comply results in fines. 

When energy usage is benchmarked and reported in ESPM the associated GHG emissions are calculated for you, making it an easy process for you. It also takes into account your eGRID region which the EPA created to calculate emissions based on location. Electricity from the grid receives electricity from different sources such as non renewable sources (natural gas and coal) and renewable sources (solar, wind, and hydro). This varies depending on your provider and region (landlocked areas aren’t receiving electricity produced from the ocean like Seattle is) so the eGRID region allows ESPM to calculate your emissions more accurately.

What are examples of Benchmarking Policies vs BPS policies?

The state of California, prior to announcing its BPS policy, only had a benchmarking policy as part of the Building Energy Benchmarking Program. Building owners are required to report their energy consumption by June 1st annually through ESPM. There were no requirements to reduce energy consumption.

Seattle’s Building Energy Performance Standards (“BEPS”) policy is BPS regulation that requires buildings to reduce their limits, decreasing every five years until Net-Zero. The city requires buildings to report their energy consumption annually using Energy Star Portfolio Manager and compliance limits to be met in five year intervals.

Building efficiency improvements can be expensive, however, there are incentives provided at all levels of government and through other providers such as utility companies to offset these capital costs. Furthermore, creating a more energy efficient building can reduce operational costs associated with heating and cooling, the primary sources of energy usage. Using incentives to fund efficiency improvements can save on operational costs, avoid non-compliance fines, and improve your NOI.

More than benchmarking but less than BPS

Using the Institute for Market Transformation’s (“IMT”) definition of BPS, there are policies that do not quite reach BPS status, but do require more than just reporting your energy or emissions through benchmarking. These policies require additional audits and/or building and systems improvements through retro-commissioning.

For example, Los Angeles has the Existing Buildings Energy and Water Efficiency (EBEWE) Program, in effect since 2017, that requires existing buildings (at the building level, not the property level) to benchmark annually and perform Audits and Retro-Commissioning. Building owners must benchmark energy and water usage using ESPM annually. Additionally, every five years, the energy and water systems in the building must be performed and retro-commissioning (upgrades or improvements) must be made if the audit shows the building is not up to standard. Failure to comply results in fines. It is important to note that Los Angeles will also be announcing BPS policy on Earth Day which may or may not impact current EBEWE requirements.

It can be confusing and planning is essential

In summary, benchmarking policies require building owners to report energy usage while BPS policies require building owners to report energy usage and reduce energy usage. Of course, there are other policies and regulations that require benchmarking and performance audits and upgrades while not falling under the definition of a BPS policy. Meeting the requirements for policies may require planning to access data and/or implement energy efficiency measures. Stay ahead of regulation and plan accordingly to avoid unnecessary fines and save on operation costs through energy efficiency measures.