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Legislative Report — Clean Buildings Performance Standard, Washington State Department of Commerce (May 2025)

Summary

This May 2025 report to the Legislature from the Washington State Department of Commerce covers the Clean Buildings Performance Standard, reported under RCW 19.27A.210 and RCW 19.27A.220. It states that Chapter 285, Laws of 2019 created the Standard, which applies to Tier 1 commercial buildings that are 50,000 square feet and larger, and that the law expanded in 2022 to Tier 2 buildings. The report gives an estimated 8,387 Tier 1 buildings and 4,390 building owners. For June 2025, it lists steps Commerce must take, including improving the Clean Building Standard Portal user experience and identifying Tier 2 buildings and notifying building owners.

Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used

Cite this document

“Legislative Report — Clean Buildings Performance Standard, Washington State Department of Commerce (May 2025).” Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2025-commercereports-2025-energy-cleanbuildings-final-6fcb9d03-ca34-42-9d4b38babf/, SHA-256 435a92a9f4b71e13c550793badb34ae46a892691f9668844fc1c41a697f51ac3.

Full text

Clean Buildings Performance
Standard Legislative Report
2025 report per RCW 19.27A.210 and RCW 19.27A.220




                                           May 2025

                                           Report to the Legislature

       ENERGY DIVISION                     Director Joe Nguyễn

v3.5
Acknowledgments
Washington State Department of Commerce
Jennifer Grove, Assistant Director, Energy Division

Buildings Unit
• Emily Salzberg, Managing Director
• Annalyn Bergin, Compliance Lead
• Dillon Ackerman, Compliance Specialist
• Luke Howard, Technical Support Lead
• Kyoung-Jin Lee, Data Lead
• Josette Gates, Incentive Program Lead



1011 Plum St. SE
P.O. Box 42525
Olympia, WA 98504-2525

www.commerce.wa.gov

For people with disabilities, this report is available on
request in other formats. To submit a request, please
call 7-1-1 and ask to be connected to 360-725-4000.




2024 CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT   2
Table of Contents
Executive summary...................................................................................................................................... 4
  Overview ..................................................................................................................................................................... 4
     Legislative and program developments ........................................................................................................................... 5
     Challenges and strategic recommendations................................................................................................................... 5
     Future outlook and goals ..................................................................................................................................................... 5
   Legislative mandate .................................................................................................................................................. 6
   Key findings or highlights ......................................................................................................................................... 6
   Recommendations .................................................................................................................................................... 6

Introduction ................................................................................................................................................. 7
  Background ................................................................................................................................................................ 7

Progress to date .......................................................................................................................................... 9
  Legislative activities ................................................................................................................................................ 11
     HB1390: Decarbonizing district energy systems .......................................................................................................... 11
     HB1976: Incentive payments for Tier 1 and 2 buildings .............................................................................................. 12
     Budget Proviso: Clean buildings workgroup and report on the financial impact and cost of compliance ........ 13
   Incentive programs.................................................................................................................................................. 14
     Tier 1 Early Adopter Incentive Program .......................................................................................................................... 14
     Tier 2 Early Adopter Incentive Program .......................................................................................................................... 15
     Energy audit incentive for public buildings program .................................................................................................... 16
     Database development ...................................................................................................................................................... 16
     Outreach ............................................................................................................................................................................... 17
     Community partners........................................................................................................................................................... 18
     The Smart Buildings Center .............................................................................................................................................. 18
     Utility-sponsored accelerator program ........................................................................................................................... 18
     The Association of Washington Cities (AWC) and the Washington State Association of Counties (WSAC) ... 19
     Customer support ............................................................................................................................................................... 19
     Expanding building owner support through an energy fellow network .................................................................... 21
     Technical support ............................................................................................................................................................... 21

Recommendations ..................................................................................................................................... 22


Table 1 - Tier 1 versus Tier 2 covered buildings ........................................................................................................ 7
Table 2 - Number of Tier 1 building by county .......................................................................................................... 10
Table 3 - Clean Buildings legislative and rulemaking activities 2019-2024 …………………………………………………………… 11
Table 4 - Decarbonizing district energy systems rulemaking activities …………………………………………………………………..12


Figure 1 - Tier 1 buildings by county .......................................................................................................................... 10
Figure 2 - Customer support inquires in 2023 versus 2024 ..................................................................................... 19


CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                                                                                                       3
Executive summary
Overview
The Washington State Legislature created the state's Clean Buildings Performance Standard (CBPS, or
Standard) in Chapter 285, Laws of 2019, which applies to Tier 1 commercial buildings that are 50,000 square
feet and larger. In 2022, the law expanded to include buildings larger than 20,000 square feet and multifamily
residential buildings, referred to as Tier 2 buildings. The standard was created to improve the energy
performance of existing large buildings to meet the state's greenhouse gas (GHG) reduction goals in RCW
70A.45.020. There are an estimated 8,387 Tier 1 buildings and 4,390 building owners. Tier 2 buildings are still
being identified. The following is the reporting schedule by tier and size:

Tier 1 covered buildings reporting schedule

   •   June 1, 2026 – More than 220,000 sq. ft.
   •   June 1, 2027 – More than 90,000 sq. ft. but less than 220,001 sq. ft.
   •   June 1, 2028 – More than 50,000 sq. ft. but less than 90,001 sq. ft.

Tier 2 covered buildings reporting schedule

   •   July 1, 2027 – More than 20,000 sq. ft. but less than 50,001 sq. ft. and all multifamily residential
       buildings more than 20,000 sq. ft.

This report covers recent legislative activities, incentives provided to support mandatory compliance, financial
impact on building owners, database development, outreach, technical assistance, customer support, and
recommendations from Commerce to the Legislature. This report also supports Washington state’s
commitment to reducing GHG emissions through improved energy efficiency in the building sector. Through a
robust combination of legislative actions, program development, technical support and financial incentives, the
CBPS provides a pathway for both public and private building owners to align with the state’s climate
objectives. Ongoing efforts to streamline compliance, expand access to resources, and address unique
challenges faced by smaller or under-resourced properties will be crucial as we approach the 2026 compliance
deadlines and beyond. This report summarizes the progress and implementation of the CBPS and the
administration of the Early Adopter Incentive Program.

In 2024, the Department of Commerce made significant strides in the CBPS program’s implementation,
supported by legislative initiatives and funding to facilitate compliance. Key achievements include:

   •   Database and portal launch: The Clean Buildings Database Portal offers building owners an efficient,
       centralized system to manage compliance and incentive applications.
   •   Decarbonization rules: Following Chapter 291, Laws of 2023 (HB 1390), Commerce completed
       rulemaking for decarbonization of district energy systems, providing a long-term compliance pathway
       to achieve decarbonization targets for state campus energy systems.
   •   Increased outreach and support: In response to a 98% increase in support requests, Commerce
       expanded its outreach and technical support efforts, particularly targeting rural areas, multifamily
       property owners and small businesses.
   •   New funding and incentives: Federal funding was secured to support energy services in underserved
       communities through energy fellowships.




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                           4
   •   Guidelines for Tier 2 compliance: With the launch of the Tier 2 Early Adopter Incentive Program set for
       July 2025, Commerce developed detailed guidelines and facilitated public workshops to gather
       stakeholder input.

Legislative and program developments
Several incentives were implemented to encourage early compliance and support building owners with the
costs of meeting the standard:

   •   Early Adopter Incentive Program: Chapter 85, Laws of 2024 (HB 1976) increased the financial incentive
       payments for early adopters to $2 per square foot, with an additional $0.05 per kBTU of energy saved
       above the baseline requirement. This initiative encourages building owners to implement energy
       efficiency improvements ahead of their compliance deadlines.
   •   Tier 2 Incentive Program: Slated to launch in 2025, this program will support Tier 2 building owners
       and is expected to serve up to 25,000 buildings by the 2027 compliance deadline. The program
       development includes workshops and feedback sessions to address the unique challenges of these
       smaller structures.
   •   Energy audit incentive for public buildings: The Energy Audit Program, launched in 2023, is funded at
       $20 million and targets public buildings that must conduct energy audits before mandatory compliance
       in 2026. To date, this program has received 38 applications, reserving $5.9 million in funds.

Challenges and strategic recommendations
This report identifies several challenges that building owners face in achieving compliance, including the high
costs of energy efficiency improvements and limited access to resources, particularly for under-resourced and
rural property owners. To address these barriers, Commerce has made recommendations, including:

   •   Alternate compliance pathways: Commerce requests authority to adopt alternative compliance
       options, which would provide building owners more flexibility in meeting energy use intensity (EUI)
       targets.
   •   Funding for local technical assistance: Increased funding for local utility-based technical assistance
       programs is recommended to support smaller or less-resourced buildings.
   •   Enhanced incentive and grant funding: Commerce recommends expanding funding for grant
       programs, enabling more building owners to invest in energy-efficient improvements without financial
       strain.

Future outlook and goals
Commerce has set forth several key goals to continue the successful implementation of CBPS, including:

   •   Expanding support capacity: The department aims to increase staffing levels to handle the anticipated
       rise in compliance applications and support requests as deadlines approach for Tier 1 and Tier 2
       buildings.
   •   Developing a qualified energy manager training program: With the compliance deadline approaching,
       Commerce will launch training programs for energy managers to improve building energy management
       expertise across the state.
   •   Enhanced stakeholder communication: Through a combination of office hours, detailed guidance
       documents and a redesigned website, Commerce plans to simplify the compliance process and
       educate building owners on pathways to meet the standard.




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                         5
   •   Continuation of partnerships and outreach: Commerce will build on current partnerships and initiate
       new collaborations with community organizations and local governments to expand outreach and
       technical support.

Legislative mandate
This report satisfies the requirements in section 3(14) of Chapter 285, Laws of 2019:

    By January 15, 2022, and each year thereafter through 2029, the department must submit a report to the governor
    and the appropriate committees of the Legislature on the implementation of the State Energy Performance Standard
    established under this section. The report must include information regarding the adoption of the ANSI/ASHRAE/IES
    standard 100-2018 as an initial model, the financial impact to building owners required to comply with the standard,
    the amount of incentives provided under sections 4 and 5 of this act, and any other significant information
    associated with the implementation of this section.

Key findings or highlights
The following significant actions were completed in 2024:

   •   Launched the early compliance application through the Clean Buildings Database Portal.
   •   Completed rulemaking for decarbonization of district energy systems according to Chapter 291, Laws
       of 2023 (HB 1390).
   •   Published a new, free downloadable version of the Clean Buildings Performance Standard Integrated
       Document in February 2024 and July 2024.
   •   Increased outreach efforts to rural cities, under-resourced building owners, multifamily building owners,
       and small businesses, engaging with over 3,000 people
   •   Approved seven incentive applications, reserving $1.46 million in incentive funds.
   •   Launched the energy audits for public buildings grant program, Engrossed Substitute Senate Bill 5950,
       Section 130 (7).
   •   Responded to a total of 1,639 customer support requests, this is a 98% more than the previous year.
   •   Developed the guidelines for the Tier 2 incentive program, which is scheduled to launch July 2025.
   •   Partnered with more organizations to expand funding opportunities, outreach, customer support, case
       studies, tools and resources.
   •   Obtained federal funding to support underserved communities with energy specialist fellows.

Recommendations
   •   Grant Commerce authority to adopt alternate compliance pathways and grant extensions for specific
       circumstances through rulemaking.
   •   Provide additional funding for local technical assistance programs, such as accelerator programs
       offered by utilities and local government
   •   Increase state funding for grant and incentive programs to assist building owners who are complying
       with requirements and making energy-use improvements to their buildings.




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                                6
Introduction
Background
In 2019, the Legislature found that to meet the statewide greenhouse gas emissions limits in RCW 70A.45.020,
the state must require performance standards for existing large buildings. Residential and commercial
buildings are Washington's second-largest source of greenhouse gas emissions, accounting for 25% of
statewide emissions. 1 With a building's life spanning 50 to 100 years, if not more, retrofitting existing buildings
to reduce energy use is one of the most cost-efficient methods to significantly cut greenhouse gas emissions.

To improve energy efficiency in new and existing buildings and to maximize reductions of greenhouse gas
emissions from the building sector, the Legislature passed the Clean Buildings Laws in Chapter 285, Laws of
2019 (HB 1257) and Chapter 177, Laws of 2022 (SB 5722) to:

    1. Create an energy performance standard for non-residential buildings larger than 50,000 square feet;
       and

    2. Require energy management planning, operations and maintenance, as well as tracking of energy use
       over time for nonresidential and multifamily buildings over 20,000 square feet.

The Clean Buildings Performance Standard (CBPS, or the Standard) consists of American Society of Heating,
Refrigerating and Air-Conditioning Engineers (ASHRAE)2 Standard 100-2018, Energy Efficiency in Existing
Buildings, with state amendments WAC194-50. The standard applies to Tier 1 and Tier 2 covered buildings and
buildings connected to a participating district energy system.

Table 1: Tier 1 versus Tier 2 covered buildings

                           Tier 1 covered buildings                            Tier 2 covered buildings

Building size                   Greater than 50,000 square feet                    Between 20,000 and 50,000 square feet and all
                                                                                   multifamily buildings over 20,000 square feet

                                Benchmark                                          Benchmark
                                Energy management plan                             Energy management plan
Requirements
                                Operations and maintenance program                 Operations and maintenance program
                                •   Meet the energy use Intensity target or
                                •   Meet the investment criteria

                                June 1, 2026 – More than 220,000 square feet
                                June 1, 2027 – More than 90,000 square feet
Reporting deadlines
                                but less than 220,001 square feet                  July 1, 2027
                                June 1, 2028 – More than 50,000 square feet
                                but less than 90,001 square feet




1 Department of Ecology Greenhouse Gas Inventories
2 American Society of Heating, Refrigerating and Air-Conditioning Engineers




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                                            7
Table 1 demonstrates the difference between Tier 1 and Tier 2 covered buildings. Tier 1 buildings are larger
than 50,000 square feet, while Tier 2 buildings are between 20,000 and 50,000 square feet, including all
multifamily residential buildings larger than 20,000 square feet.


Tier 1 and Tier 2 covered building owners are required to benchmark their building's energy use and develop
and implement an energy management plan and operations and maintenance program in accordance with the
Standard. However, only Tier 1 buildings are required to meet an energy performance metric by either:

•   Meeting the energy use intensity target set by the state
•   Meeting the investment criteria by conducting an energy audit, life cycle cost analysis, and implementing
    all cost effective energy efficiency measures, or
•   Filing for exemption

Tier 1 compliance dates are based on the building size, and begin in 2026, spanning through 2028. Tier 2
reporting deadline is July 1, 2027.

Commerce was tasked with conducting rulemaking to establish administrative rules for the law, creating a
database of covered buildings in the state, notifying building owners of the legal requirements, establishing an
incentive program for early adopters of the standard, and providing customer support to the industry.




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                         8
Progress to date
The program made significant strides in 2024. In 2020, the program began with six staff members and has
grown to 19 staff members partially or fully supporting implementation of the standard. We increased staff
capacity to better serve stakeholders by adding additional personnel to provide technical assistance as a
result of increased demand as building owners take action towards compliance with the standard. In 2024, we
achieved the following:

•   Launched the early compliance application through the clean buildings portal
•   Completed rulemaking for decarbonization of district energy systems
•   Published CR103 for HB5722 Clean Buildings Tier 2 expansion
•   Published a new, free downloadable version of the Clean Buildings Performance Standard Integrated
    Document in February 2024 and July 2024
•   Increased outreach efforts to rural cities, under resourced building owners, multifamily, and small
    businesses
•   Launched the energy audits for public buildings grant program
•   Responded to 1,639 customer support inquiries, which is a 98% increase over 2023 requests
•   Developed the guidelines for the Tier 2 incentive program
•   Partnered with additional organizations to expand funding opportunities, outreach, customer support, case
    studies, tools, and resources

This year, Commerce has reviewed 59 exemption applications and 64 early compliance applications. 2 These
application reviews have allowed us to better understand the staff capacity needed when compliance
application volume increases during the first mandatory compliance cycle starting in 2026, refine the process
to ensure efficiency, identify upgrades required in the portal, and develop guidance documents to increase
stakeholder education in response to observed need.

Although we have made significant progress, more work is still ahead. By June 2025, Commerce must:

•   Improve the portal user experience, support the various compliance applications, and accommodate Tier 2
    building data
•   Identify Tier 2 buildings and notify building owners
•   Establish systems to accept Tier 2 early compliance and incentive applications
•   Accept participating district energy systems' decarbonization plans for review and approval
•   Review a larger volume of incentive, exemption and early compliance applications
•   Develop and produce a qualified energy manager training
•   Increase customer support capacity to better serve the volume of building owners and industry
    professionals needing assistance

Figure 1 shows the Tier 1 covered buildings county by county. There are an estimated 8,387 total Tier 1
covered buildings and 4,390 building owners. Compliance deadlines are approaching quickly. For Tier 1
covered buildings, there are 1,156 buildings larger than 220,000 square feet. This cohort of buildings are
required to comply by June 1, 2026. Our goal is that all building owners and their representatives are informed
about the standard and can confidently comply with their respective deadlines.




2 Compliance and Exemption Application Dashboard




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                           9
Figure 1: Number of Tier 1 buildings by county




Table 2: Number of Tier 1 buildings by county

County       Building Count      County         Building Count   County         Building Count


Adams              15            Ferry                 2         Kitsap              208

Asotin             14            Franklin            112         Kittitas             47

Benton            189            Garfield              1         Klickitat            18

Chelan             87            Grant               168         Lewis                67

Clallam            31            Grays Harbor         51         Lincoln               6

Clark             395            Island               21         Mason                37

Columbia            1            Jefferson            10         Okanogan             42

Cowlitz            83            King              3,172         Pacific               5

Douglas            43            Kitsap              208         Pend Oreille          4



CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                          10
County             Building Count              County              Building Count   County     Building Count


Pierce                 1,157                   Spokane                  664         Whatcom         176

San Juan                       3               Stevens                   16         Whitman          76

Skagit                   109                   Thurston                 277         Yakima          344

Skamania                       5               Wahkiakum                  2

Snohomish                664                   Walla Walla               65




Legislative activities
Over the past five years, the Standard has evolved. Table 2 illustrates the various legislative and rulemaking
activities since 2019.

Table 3: Clean buildings legislative and rulemaking activities 2019-2024
Year       Legislative Event

2019       HB1257: Clean Buildings Act

2020       Clean Buildings Performance Standard Rulemaking

2022       SB5722: Clean Buildings Expansion

           Tier 2 Rulemaking
2023       Exemption Emergency Rulemaking
           HB1390 Decarbonization of District Energy System

           HB1976: Incentive Payments for tier 1 and 2 buildings
2024
           Decarbonization of District Energy System Rulemaking



In 2024, legislative activities related to clean buildings included:

   •     Rulemaking for decarbonization of district energy systems
   •     Passing agency requested legislation, Chapter 85, Laws of 2024 (HB1976), authorizing Commerce to
         provide incentives greater than the base incentive payment for Tier 1 and Tier 2 buildings
   •     Fulfilling the budget proviso that instructed Commerce to form a Clean Buildings workgroup to create a
         list of strategies and recommendations to support building owners and to analyze the costs of Tier 1
         compliance

HB1390: Decarbonizing district energy systems
On May 4, 2023, House Bill 1390 (Chapter 291, Laws of 2023) was signed into law, amending the Clean
Buildings law to add a new section on buildings connected to district energy systems. A district energy system
is a system that provides heating, cooling, or heating and cooling to a campus through a distributed system
providing steam, hot water, or cool water to buildings. The bill acknowledges that decarbonizing buildings is
essential to meet the state's climate goals and highlights the benefits of upgrading existing district energy
systems while considering the timeline for implementing these upgrades.



CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                          11
A decarbonization plan can span 15 years or more, providing building owners with a flexible timeline to comply
with the Clean Buildings Performance Standard (CBPS). These plans, which must include strategies for
decarbonizing the heating plant and reducing energy usage, offer a structured yet adaptable approach to the
transition. While complying with decarbonization is mandatory for state campus district energy systems, it is
optional for campus district energy systems owned by private entities to opt in to this compliance pathway.

In December 2023, Commerce initiated the rulemaking process by filing the CR-101. Commerce held four
workshops from January 2024 to March 2024, focusing on the components of the decarbonization plan,
compliance reporting, and the alternate compliance pathway of the Clean Buildings Performance Standard.
Each rulemaking workshop was followed by a two-week comment period. Commerce received 20 officially
submitted comments from universities, energy consultants, local governments and healthcare institutions in
addition to dozens of emails and meetings with stakeholders.

The CR-102 was filed on May 1, 2024, and the public hearing occurred on June 4, 2024. The CR 103 was filed
on July 30, 2024, to finalize the rules for decarbonizing participating campus district energy systems.

After the rules were finalized, Commerce published an updated version of the Clean Buildings Performance
Standard for free download, including the general compliance and reporting requirements for decarbonizing
district energy systems. 3 Using the District Energy Systems Registration and Opt-in form, 34 state campus
district energy systems have registered, while three privately owned campus district energy systems have
opted in.

Table 4: Decarbonizing district energy systems rulemaking activities

Date             Rulemaking Activity                                                                  Attendees

12/11/2023       Filed CR-101                                                                         N/A

                 HB1390 rulemaking kick-off: Introduction to the decarbonization of district energy
1/18/2024                                                                                             122
                 systems

2/08/2024        Rule integration and compliance timeline                                             104

3/07/2024        CBPS and the decarbonization plan                                                    105

3/21/2024        Comprehensive review                                                                 91

5/01/2024        Filed CR-102                                                                         N/A

6/04/2024        Public hearing                                                                       44

7/30/2024        Filed CR-103                                                                         N/A




HB1976: Incentive payments for Tier 1 and 2 buildings
Last year, in Chapter 85, Laws of 2024, Commerce requested that the Legislature increase the early adopter
incentive from 85 cents per square foot to provide a more compelling financial incentive. This occurred when
HB1976 was enacted into law. The bill authorizes Commerce to increase early adopter incentives greater than
the base incentive payment for Tier 1 and Tier 2 buildings.




3 Clean Buildings Performance Standard July 2024 Version




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                           12
Commerce hosted a workshop attended by 149 individuals to solicit feedback from building owners, utility
providers and energy consultants regarding the enhanced payment. Based on public feedback, Commerce will
now award a $2 per square foot rate and an additional 5 cents per kBTU of energy saved beyond the 15
kBTU/sf/year minimum energy use intensity (EUI) reduction required by the early adopter incentive program.
Since announcement of the enhanced incentive, Commerce has received positive feedback and a 265%
increase in inquiries about the program.

Budget Proviso: Clean buildings workgroup and report on the financial
impact and cost of compliance
Report on the financial impact and cost of compliance
In the 2023-25 enacted capital budget, a proviso instructed Commerce to form a Clean Buildings workgroup to
analyze the costs of Tier 1 compliance for certain building types, including higher education, state-owned
buildings, and more. Commerce contracted with SBW Consulting in partnership with Unrooz Solutions and
2050 Institute (“SBW team”) in September 2023 to facilitate the Clean Buildings workgroup and conduct
associated analyses.

The first of two key deliverables of the proviso is a memo on the preliminary analysis of financial investments
required for owners of Tier 1 covered buildings, which was submitted by December 15, 2023.

This analysis aimed to better understand costs and other barriers to compliance with the CBPS. The memo
provided insight into the landscape of Tier 1 building types, the percentage of buildings that likely already
comply with the CBPS energy use intensity targets (EUIts), and preliminary analysis of the financial
investments required by non-complying buildings to meet their EUIts.

The preliminary financial analysis highlights:

•   67% of benchmarked Tier 1 buildings in Seattle meet the targets4
•   Lifetime benefits exceed costs
•   Benefits were found across size cohorts
•   Public buildings had higher first costs than private buildings and lower benefit-cost ratios

Clean Buildings workgroup recommendations and the final financial analysis report
The Clean Buildings workgroup met between November 2023 and July 2024 to develop 10 recommendations
and 57 strategies to support building owners and managers with compliance with the CBPS. The workgroup
worked collaboratively to meet the second deliverable required in the budget proviso.

The second final report deliverable includes additional compliance cost analysis, a description of the
workgroup facilitation process, and a list of strategies and recommendations put forward for the Legislature’s
consideration.

The final report builds on the preliminary analysis and is representative of a cost survey of workgroup
members and case studies of six buildings. The highest ranked recommendations involve:

•   Increasing and unlocking additional funding for all sectors
•   Ensuring public and privately owned buildings have the human resources for ongoing compliance

4Preliminary Financial Analysis of WA State Building Energy Performance Standard




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                         13
•   Adjusting the CBPS to create more clarity on energy efficiency and greenhouse gas reduction goals, better
    match the needs of building owners and managers, and ensure alignment between various pieces of
    existing legislative requirements
•   Develop new compliance pathways

In addition to the high-level recommendations, more granular strategies were developed to provide actionable
items that meet the intent of the recommendations. These include the following:

•   Providing clarification around financing and payback options for public institutions
•   Utilizing Climate Commitment Act funding to expand existing programs and create new funding
    opportunities for public and private institutions
•   Funding to support energy manager or resource conservation manager positions for public institutions
•   Increase funding available to support building owners and managers with metering
•   Adding additional flexibility to the conditional compliance pathway
•   Allowing non-profit institutions to be considered public entities for funding and incentive allowances
•   Setting future energy use intensity targets to provide a clear investment pathway and predictability in the
    market for building owners and managers

The collection of recommendations and final financial analysis is in the completed Clean Buildings workgroup
report to the Legislature.

Incentive programs
Commerce now offers three incentive programs to support building owners and their representatives:

    •   Tier 1 Early Adopter Incentive Program
    •   Tier 2 Early Adopter Incentive Program
    •   Energy Audits for Public Buildings Program

Each program was designed to provide incentive funds to encourage early adoption and help with the cost of
compliance.

Additionally, Commerce has increased outreach efforts and updated program requirements for the Energy
Efficiency Retrofit for Public Buildings grant program to better support building owners' progress in funding
compliance with the Standard.

Tier 1 Early Adopter Incentive Program
RCW 19.27A.220 requires Commerce to administer an Early Adopter Incentive Program to encourage early
compliance with the Clean Buildings Performance Standard. The Legislature authorized $75 million for
participating utilities to offer as incentives to building owners for early compliance. Eligible buildings can also
receive utility conservation incentives and other financing mechanisms.

To be eligible for the incentive program, buildings must be served by at least one electric utility, gas company,
or thermal energy company participating in the program. Buildings must be at least 15 EUI over the target by
building type. Buildings demonstrating early compliance with the standard may receive 85 cents per gross
square foot. Participating utilities pay this incentive directly to the building owners. This cost per square foot
has been subsequently increased and this increase is available to all existing incentive program applications.




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                           14
Commerce launched the Early Adopter Incentive Program in 2021 to provide incentives to building owners who
reduce their EUI and meet their building’s EUIt. As of October 2024, the program has 10 applications. Seven
applications are approved with approximately $1.46 million in reserved funds.

This program has had a lower-than-expected application rate, so we investigated barriers to applications. The
findings showed:

•   The costs to implement energy efficiency measures (EEMs) can be high when buildings are over their EUIt.
•   Building characteristics are variable, resulting in a broad range of EEM implementation costs.
•   Existing program applicants report that the cost of implementation of EEMs ranges from $3.60 to $35.01
    per square foot.

Commerce was authorized by HB 1976 to enhance the incentives greater than the base incentive payment.
The bill intended to increase participation in the program.

Commerce hosted a workshop, attended by 149 individuals, to solicit feedback from building owners, utility
providers, and energy consultants regarding the enhanced payment. Based on the public’s feedback,
Commerce will now award a $2.00 per square foot rate as well as a $0.05 per kBTU of energy saved beyond
the 15 kBTU/sf/year minimum EUI reduction required by the early adopter incentive program. The maximum
incentive payment is 50% of the approved construction cost to implement to the EEMs. Since announcement
of the enhanced incentive, Commerce has received positive feedback and an increase in inquiries about the
program.

Looking forward, the enhanced payment along with communicating the benefits of this program to applicants
will increase application to the program.

Tier 2 Early Adopter Incentive Program
The Tier 2 Incentive Program was authorized as part of the Clean Buildings Expansion legislation, Chapter 177,
Laws of 2022. The Legislature authorized $150 million to support Tier 2 building owners. Tier 2 buildings are
between 20,000 and 50,000 square feet, and multifamily buildings greater than 20,000 square feet. These
buildings must comply with CBPS by July 1, 2027. This incentive program requires building owners to comply
with the Clean Buildings Performance Standard by completing energy benchmarking, an energy management
plan, and an operations and maintenance program. The incentive is a base incentive of 30 cents per gross
square foot.

The program is currently in its design and outreach phase and will officially launch July 1, 2025. To help design
the program and develop the guidelines, Commerce hosted six workshops. The workshop series allowed the
public an opportunity to engage with the incentive team, provide feedback and comments on how to structure
the program and identify the needs and barriers of the building owners. Funding distribution is being analyzed
to ensure that we meet the needs of building owners with a possible enhanced incentive above the base
amount. It is estimated this program could serve between 10,000 and 25,000 buildings.

Looking forward, we expect to receive approximately 15,000 applications for this program over the two-year
compliance period. Efficiency in application processing within the Clean Buildings Portal will be paramount to
support application reviews. Further planning will be required to ensure adequate staffing to process the
program applications.




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                       15
Energy audit incentive for public buildings program
The 2023 Legislature passed the Audit Incentive for Tier 1 publicly owned buildings. As a result of the budget
proviso, Commerce offers an energy audit incentive that will be used to cover part or all of the cost of
conducting an investment-grade energy audit. Funded at $20 million, this program has the potential to serve
several thousand large public buildings before the mandatory Clean Building Performance Standard
compliance deadline of 2026.

As of October 2024, the program has 38 applications reserving $5.9 million in funding. The incentive team is
evaluating applications and executing contracts until the program end in June 2025. Commerce continues to
provide customer assistance for this incentive program by helping users establish their Energy Star Portfolio
Account for benchmarking building energy use and developing a streamline process for applicants.

Looking forward, we need to focus on communicating the benefits of the audit program to potential applicants
so that the program can award all of its funds during the timeframe in which funding is authorized, from July
2023 to June 2025. Also continuing to focus on streamlining the process for applicants and the contracts
team will support awarding and spending all the funding.

Database development
The Clean Buildings Portal is a database of all covered buildings in the state. It provides building owners a
secure system to manage and submit their building’s compliance and incentive applications with the Clean
Buildings Performance Standard. Currently, the database consist of Tier 1 buildings.

In 2024, Commerce began to develop the Tier 2 database. Our data team engaged with several external real
estate data companies and evaluated numerous potential data sources. To ensure data quality prior to
database construction, we conducted a preliminary analysis by comparing the Tier 1 data in our database with
the external sources. With over an 85% confidence level, we confirmed that the external data is sufficiently
reliable to proceed with building the Tier 2 database.

In addition, Commerce introduced the early compliance application on the Clean Buildings Portal, a significant
step for building owners who have met compliance requirements. This application automated several
compliance forms, making it easier for users to calculate their EUIt, connect to their Energy Star Portfolio
Manager account for benchmarking, and track their compliance status. The introduction of this application not
only simplifies the compliance process but also saves time and resources for building owners.

As part of our data quality enhancement strategy, we will also cautiously restore purged multi-family data, but
only if it meets Tier 2 requirements because this building type is now covered by the Standard. This process
involves a thorough review of the data and re-categorizing it with confirmation from the building owners. We
aim to enhance the quality of Tier 1 data and increase the volume of Tier 2 data.

We are continuously updating and enhancing our database to accurately record Tier 1 building data and
accommodate a range of applications for compliance, Tier 1 incentives, and exemption. To streamline the
application process, we have implemented a signature routing feature that allows all stakeholders to access,
review, and sign applications efficiently. We are also developing more robust compliance features to address
complex scenarios, including alternative pathways such as connected buildings, campus-level systems, state
Campus District Energy Systems, Campus District Energy Systems, and de-carbonization plans.

We have several planned updates and expansions to the Clean Buildings Portal. We have integrated Energy
Star Portfolio Manager into our database and will incorporate GIS maps into the portal in the coming year.


CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                         16
Additionally, we are cleansing and reformatting external data to build the Tier 2 database and plan to notify
Tier 2 building owners before July 1, 2025. Tier 2 incentive and compliance application features will also be
available through the portal.

Looking ahead, our long-term goal is to provide more comprehensive reports and data visualization tools.
These tools will allow stakeholders to easily track compliance status and processes, reducing the need for
consultation from multiple sources. With these new features, building owners will benefit from improved
support and streamlined application processes, making compliance with our standards more efficient.


Outreach and customer support
Outreach
Compliance for the largest buildings, greater than 220,000 square feet, is in July 2026. The Clean Buildings
Performance Standard is process-oriented, with extended lead times designed to minimize compliance costs.
It is most cost-effective to start the compliance process as early as possible. Our outreach objectives are to:

   •   Raise awareness about the Clean Buildings Performance Standard
   •   Educate building owners and managers on compliance benefits and requirements
   •   Encourage adoption and implementation of the standard
   •   Inform and encourage participation in the Early Adopter Incentive Program

In May, Commerce mailed reminder letters to 798 building owners, covering 1,156 buildings, who are required
to comply by June 2026. The letters reminded building owners about the compliance deadlines, requirements,
and funding opportunities.

With additional staff, we increased our outreach activities and reach larger audiences through public
workshops, webinars, online training, social media, email newsletters, media coverage, community meetings,
and partnerships with industry associations.

Commerce attended or hosted over 74 in-person and virtual events, including symposiums, webinars,
conferences, workgroup meetings, presentations, trainings, panels, etc. We engaged with over 3,000 people in
gatherings such as:

   •   17 Commerce-led webinars and trainings
   •   Tacoma Clean Buildings Symposium
   •   Higher Education Sustainability Conference
   •   Association of Washington Cities Conference
   •   Southwest Washington Clean Buildings Symposium
   •   Higher Education Buildings Workgroup
   •   International Facilities Manager Association (IFMA) Conference
   •   County Commissioner Virtual Assembly
   •   Washington CBPS Utility Working Group

As the first state in the nation to establish a building performance standard, Commerce leads in this area and
has shared its expertise at national conferences, including the American Council for an Energy-Efficient
Economy (ACEEE) 2024 Summer Study and the ASHRAE Winter Conference. Additionally, Commerce has




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                         17
provided technical assistance to Colorado, Oregon, Maryland, as well as individual cities adopting building
performance standards.

Community partners
Commerce has developed partnerships and collaborations with local governments and industry associations
to extend our reach. Examples of successful partnerships include the Smart Building Center, the utility
sponsored Clean Buildings accelerator programs, the Association of Washington Cities, the Washington State
Association of Counties, the Building Owners and Managers Association (BOMA), and National Association for
Industrial and Office Parks (NAIOP). These organizations have significantly supported stakeholders by
providing technical assistance, promoting the standards through their networks, and integrating information
into their communication channels and events.

The Smart Buildings Center
The Smart Buildings Center (SBC) has been a significant community partner. The SBC is a joint project of the
Smart Buildings Center Education Program and Building Potential. The mission of the Smart Buildings Center
is to accelerate the adoption and commercialization of smart buildings practices and technology through
education and demonstration. They aim to provide building owners, operators, and managers with a road map
to smarter, more efficient buildings.

The SBC provides the building community with educational programs and resources, such as:

•   The Building Operator Certification (BOC) Level II, a credential for building operators and the qualified
    person
•   The Tool Lending Library (TLL), to help the building community make informed choices about energy
    efficiency and smart technologies
•   The Clean Buildings Performance Standard Helpdesk
•   Outreach through workshops and key community engagements

Since 2022, Building Potential has worked with several Washington utilities in a cost-sharing arrangement to
provide training and support for utility customers as they prepare to comply with the new Washington State
Clean Buildings Standard through a help desk approach. In 2023 and 2024, Building Potential utilized a cost-
sharing arrangement to continue delivering training and offered inbound and outbound technical assistance as
building owners and operators prepare to comply with the standard and engaged with early adopter
opportunities.

Utility-sponsored accelerator program
The utility-sponsored Clean Buildings Accelerator program, delivered by Stillwater Energy, is designed with the
goal of supporting end-use customers in compliance with the Washington Clean Buildings Standard. The
program is framed on the foundation of Strategic Energy Management (SEM) and designed to meet each
organization where they’re at. Since 2022, Stillwater Energy has delivered the Accelerator program to 31
cohorts, comprised of 250 organizations in partnership with five utilities spanning the state. Their customers
receive extensive compliance coaching and gain energy efficiency-related benefits that span beyond law
compliance with this participant quote reflecting a typical experience:

“The Accelerator made it easier to complete the tasks due under the WA State Clean Buildings Standards as
well as helped to teach and explain to our board of directors, leadership, participants, and staff what we are




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                          18
doing, how we are doing it, and why we are doing it.” - Veronica A. Gallardo, Property Manager, El Centro de la
Raza; Participant in Seattle’s Clean Buildings Accelerator

The acceleratory program's SEM derived coaching approach supports participants in their compliance journey
through a series of workshops, one-on-one coaching, and resources. Continuous improvement is the crux of
our Clean Buildings Accelerator program design and we’re constantly improving and adapting to integrate the
latest law updates and learnings from other participants. Workshops foster peer learning and sharing of
experiences with engagement with over 100 participants.

Accelerator benefits include:

   Support with benchmarking and setting up Energy Start Portfolio Manager
   Free virtual building controls review to support participants in identifying and implementing low-cost/no-
   cost energy savings opportunities
   Resources and templates to support long-term compliance and organizational energy management goals
   including:

   •   Energy management plan and operations and maintenance program templates
   •   Engagement resources
   •   Compliance guides, tasks lists and standard operating procedures

The Association of Washington Cities (AWC) and the Washington State
Association of Counties (WSAC)
This year, Commerce partnered with AWC and WSAC by awarding nearly $8 million in grant funding to pay for
energy audits and collect data on the costs of compliance with the CBPS for city and county-owned
buildings. These grants are funded through Washington’s Climate Commitment Act. The Incentive Team
provided support to AWC and WSAC during their program design process.

The associations will provide outreach to their members, including guidance on energy auditor selection and
contracting, and provide grants to cities for energy audits. They will also collect cost data and other metrics for
reports due to the Washington Legislature in December 2025.

Customer support
Between October 2023 and September 2024, Commerce responded to 1,664 support requests. Compared to
the previous year total of 840 support requests, this is a 98% increase year-over-year, representing a
substantial rise in stakeholder demand as compliance deadlines approach. With Tier 2 notification letters
expected to go out by the end of June 2025, the expected volume of assistance requests associated with this
outreach will increase exponentially as a large number of Tier 2 building owners are contacted. The figure
below shows a breakdown of assistance requests received and completed from October 2023 through
September 2024, compared to the previous year.




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                         19
Figure 2: Customer support inquires in 2023 versus 2024
                                Oct. 2022 Through Sept. 2023         Oct. 2023 Through Sept. 2024


    Compliance/Technical Assistance                                                                             623

 Building Owner Notification Request                                                    379

                Clean Buildings Portal                        159

       Energy Audit Incentive Program                   111

                  Website/ Resources               86

    Early Adopter Incentive Program              73

                                Policy           71

                                 Data            57

                                Other                  105

                                         0       100           200         300         400          500   600         700




Figure 2 illustrates a substantial growth in customer support requests, particularly focused on technical
assistance, website/resource questions, and inquiries about both the energy audit and early adopter incentive
programs. With the first Tier 1 compliance deadlines approaching, we expect heightened demand for technical
assistance, compliance guidance, and incentive program resources.

As part of Commerce’s customer support towards CBPS compliance, the Clean Buildings Team has developed
multifaceted education efforts.

   •     Created and updated 18 step-by-step compliance guidance documents
   •     Host monthly office hours
   •     Coordinate in-person and online meetings with customers and stakeholders
   •     Conducted a website redesign for accessibility

The Clean Buildings Team staff created/updated 18 guidance documents, which provide plain talk guidance on
a wide range of compliance and technical assistance topics, including but not limited to: determining and
meeting energy use intensity targets, energy benchmarking, life cycle cost analysis, compliance pathways, and
more. Commerce hosted 17 webinars/trainings specifically meant for communicating and educating
stakeholders about compliance pathways, rulemaking developments and policy updates.

The Clean Buildings Team hosts dedicated office hours to allow stakeholders to drop in and engage with the
team regarding the CBPS. These office hours began in July 2024. Commerce also coordinates in-person and
online meetings with customers and stakeholders to assist with complex compliance questions or for
questions concerning portfolios of buildings. In addition, to ensure greater accessibility, Commerce conducted
a website redesign, aimed to make finding and engaging with the CBPS website and resources easier. These
strategies help Commerce scale up engagement and guide larger numbers of stakeholders through the
compliance process.




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                                     20
Expanding building owner support through an energy fellow network
In August 2024, Commerce was awarded $7.78 million by the U.S. Department of Energy to fund the Building
Efficiency and Clean Operations Network (BEACON) project. The BEACON project will help building owners
statewide who need support to meet the state’s building performance standard. Through partnerships with
Smart Buildings, Strategic Energy Innovations (SEI), and San Timoteo Associates, this project will produce a
cohort of 60 energy fellows who will provide energy services to large commercial and multifamily buildings in
disadvantaged or underserved communities, help them capture energy savings, and bring them into
compliance with the CBPS. This project will also grow the workforce in buildings and energy efficiency
industries in Washington.

Technical support
The Clean Buildings Program technical team works closely with our outreach and education team to provide
technical support to stakeholders utilizing several formats, including webinars/workshops, guidance
documents, one-on-one virtual meetings, Q&A, emails and phone calls through the Clean Buildings hotline. This
resource development and delivery requires continual maintenance of technical expertise to keep up with
developing legislation, standards, technology and economic indices. In 2024, the technical team reached out to
several national and regional experts to partner in development and maintenance of several tools and
resources.

In response to requests from stakeholders, the Clean Buildings team partnered with Lawrence Berkeley
National Laboratory (LBNL), funded by the U.S. Department of Energy (DOE), in the development of several
case studies focused on compliance with the standard. These short case studies are designed to be easily
digestible by building owners and are specific to projects subject to the standard and at various stages of
completion. Two of the four case studies feature Early Adopter Incentive Program applicants. The case studies
are pending DOE approval to be published.

The Clean Buildings team has also partnered with LBNL in the development of an operations and maintenance
(O&M) program template/tool. This resource is being developed with the less resourced Tier 2 building owner
in mind with emphasis on ease of use. The hope is that this tool will be an effective resource to facilitate in-
house development and implementation of an effective O&M program in accordance with the standard.

The Clean Buildings team used the acquisition of additional staffing to further develop its expertise in life-cycle
costing in partnership with Rock Ventures LLC. The standard's life-cycle cost analysis (LCCA) form, Form F,
was developed based on Rock Ventures LLC’s life-cycle costing tools used by Washington state's Office of
Financial Management and Department of Enterprise Services for the last decade. This partnership increases
the team’s ability to provide the highest level of expertise in the maintenance, technical assistance and
education for Form F and the LCCA tools used by other state-run programs.

In 2024, the technical team continued its partnership with the American Society of Heating Refrigeration and
Air Conditioning Engineers (ASHRAE) in updating and publishing the Integrated Clean Building Standard.
ASHRAE’s published version of Standard 100 -2018, WAC194-50 incorporates our Clean Buildings
Performance Standard rules into a single, cohesive document available for free download from the Commerce
website. This collaboration incorporated our Tier 2 rules in February of 2024 and additional changes made
during rule making for HB1390 in August of this year. Additionally, the Clean Buildings team participated in
several ASHRAE Standard 100 committee and subcommittee meetings in 2024 to provide experiential
perspectives that are essential to ongoing standard refinement.




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                         21
Recommendations
By June 2025, Commerce must accomplish the following to continue the successful implementation and
administration of the standard:

   •   Improve the Clean Building Standard Portal user experience and support various applications as well as
       Tier 2 building data
   •   Identify Tier 2 buildings and notify building owners
   •   Be ready to accept Tier 2 early compliance and incentive applications
   •   Accept participating district energy systems' decarbonization plans
   •   Review a larger volume of incentive, exemption and early compliance applications
   •   Develop and produce a qualified energy manager training
   •   Increase customer support capacity to better serve more building owners

Based on the list of initiatives Commerce must administer, and the Clean Buildings workgroup
recommendations, we recommend the following to successfully implement the standard:

   •   Grant Commerce the authority to adopt alternate compliance pathways and grant extensions for
       specific circumstances.
   •   Provide additional funding for local technical assistance programs, such as the accelerator programs
       offered by the utilities.
   •   Increase funding to support building owners required to comply and motivated to make energy-use
       improvements to their buildings.




CLEAN BUILDINGS PERFORMANCE STANDARD LEGISLATIVE REPORT                                                       22


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