Local governments throughout the United States and Canada have adopted energy benchmarking programs these last two decades. Along with energy benchmarking laws, ordinances, and voluntary programs, Building Performance Standards (BPS) are also becoming more prevalent. BPS laws are expected to be established throughout the US among different jurisdictions ranging from city requirements to state policies. Denver is one of the initial ten jurisdictions to have BPS requirements for existing buildings. Learn more about the Denver Building Performance Policy and what the BPS program entails.

What is the Denver BPP?

The Denver Building Performance Policy (BPP) is a law adopted in 2021 that sets energy performance standards for most commercial and multifamily buildings in the City and County of Denver. The BPP is one of the City and County of Denver’s central strategies for meeting its goal of getting all existing buildings and homes in Denver to net zero energy by 2040. The BPP consists of three types of requirements:

This article will focus on the performance requirements for buildings 25,000 square feet and larger.

Denver Building Performance Standard Requirements

All commercial, multifamily, institutional, municipal, manufacturing, agricultural, and industrial buildings in the City and County of Denver that are 25,000 square feet or larger are covered by the BPP’s performance requirements. This means that they must meet specific energy performance targets by 2030 or be penalized. The targets are set according to a performance metric called Site Energy Use Intensity (EUI). Site EUI (kBTU/square foot) is defined as the total amount of energy a building uses in a year regardless of the energy source, divided by the building’s square footage. As its name suggests, Site EUI only measures the energy used at the building site and does not take into account losses from the generation of distribution of energy.

To set the 2030 Site EUI targets, the Denver Office of Climate Action, Sustainability, and Resiliency analyzed benchmarking data submitted for the City’s annual benchmarking and transparency requirement and national building energy datasets to determine the targets. The targets are set so that buildings performing in the top 15% of their property type have already met the 2030 target and need only maintain their performance. Mixed-use buildings will have a weighted Site EUI target based on the square footage percentage of the 3 largest property types using the building.

This table shows a snapshot of several of the 2030 targets for some of the most common building types in Denver, but the full table contains targets for more than 70 different building types.

denver building energy performance standard

There are several unique building types (e.g., museums, convention centers, etc.) for which Denver was not able to set a specific Site EUI target for 2030. Instead, buildings of these types must achieve a 30% Site EUI reduction from their 2019 baseline. The full table of targets, available in the link above, shows each of these unique building types. Denver also has unique rules for data centers; newly constructed buildings; campuses; and manufacturing, agricultural, or industrial buildings. If you own a building in one of these categories, see the official technical guidance to find more information about these requirements.

2030 BPS Targets and Interim Targets

As stated above, the 2030 performance targets are common to all buildings within a property type. This means that all office buildings in Denver will need to perform at a Site EUI of 48.3 or better by 2030. All hotels will need to perform at least at a Site EUI of 61.1 by 2030 and so on. In addition to meeting this 2030 performance target, each building will need to meet two interim targets, one in 2024 (though for many buildings this has been delayed to 2025, see below for details) and the other in 2027. The interim targets are specific to each building. They are calculated by drawing a line between the building’s baseline Site EUI performance as recorded in 2019 benchmarking data submitted to the City and County of Denver and the 2030 Site EUI target for the building’s property type. The slope of the line determines the Site EUI levels that a building must meet to achieve compliance in 2024 and 2027. Here is a graph showing the performance trajectory for a hypothetical building.

Denver’s CASR Office granted an extra year to meet the 2024 interim target for all buildings that have completed a 2022 benchmarking submission. According to CASR, 94% of buildings have earned this extension and have until 2025 to meet their 2024 interim target.

Target Adjustments

Denver’s CASR allows building owners to apply for an adjustment to their buildings’ assigned 2030 Site EUI targets if the building meets qualifying conditions. Denver will consider applications for target adjustments for building types where variations in their operating hours made a significant impact on their energy use. Buildings with indoor or outdoor swimming pools, parking lots, data centers, and more than three property types are also eligible to apply for a target adjustment.

Alternate Compliance Options

The most straightforward way for a building owner to comply with the BPP’s performance requirements is to meet each target when it is due; however, the BPP includes multiple alternative compliance options (ACOs).

There are four types of ACOs that eligible buildings can apply for:

Timeline Adjustment
Electrification Option
30% EUI Reduction Property Type Adjustment
Manufacturing, Agricultural, or Industrial (MAI) Designation
Equity Priority Buildings Adjustment

Detailed information on each Alternate Compliance Option and instructions on how to apply for them is available here but we have also provided a summary of each below.

Timeline Adjustment ACO

Buildings that experience a qualifying event that would make it difficult for them to meet the compliance targets as assigned on time can apply for an adjusted compliance timeline.

There are certain events in a building’s lifecycle that may make it challenging to meet the compliance deadlines as assigned, and you can apply to adjust your building’s compliance timeline. Qualifying events include planning for the end of life for a major building system or piece of equipment, planning for a major renovation, financial distress, and many others (see the full list of qualifying events on page 2 of this excerpt from the official technical guidance.

Electrification ACO

To encourage buildings to switch from fossil fuel-powered to electric heating and water heating equipment, Denver will adjust the 2030 site EUI target by 10% to make it easier to comply for buildings that use electricity for 80% or more of their total energy use. For example, a building with an assigned 2030 site EUI target of 50 that achieved 80% electrification would have its 2030 target adjusted to a 55. While Denver will automatically apply this adjustment to any building that meets this electrification threshold shown in their annual benchmarking submission, building owners that plan to electrify at least 80% of their whole-building energy use can also receive credit by submitting documentation of their plan to Denver to have their targets adjusted before implementation of the plan. A successful Electrification ACO application will result in a legally-binding agreement with the City and County of Denver, where the agreement becomes the building’s new compliance plan and could result in higher penalties if the building fails to achieve sufficient electrification. This excerpt from the technical guidance contains the rules and instructions for applying for the Electrification ACO.

30% EUI Reduction Property Type Adjustment

Denver issued a 30% reduction goal instead of defining a specific 2030 EUI Target for uncommon building types such as museums, ice rinks, and convention centers. These buildings, as well as historic buildings that have been limited in the energy efficiency improvements they can make by the Landmark Preservation Commission, are eligible to apply for an adjustment to the 30% performance target. This alternate compliance option is most applicable to the buildings in this group that are already high-performing and would not be able to reach a 30% reduction target. This excerpt from the technical guidance contains the rules and instructions for applying for the 30% EUI Reduction Property Type ACO.

Manufacturing, Agricultural, or Industrial Option

As of April 2023, the City and County of Denver has not issued rules for the alternate compliance option for MAI buildings.

Equity Priority Buildings Adjustment

If your building qualifies as an Equity Priority Building you can also apply for an adjusted timeline to align with refinancing cycles or to accommodate other restrictions that limit timely access to capital.

Third-Party Verification

The BPP adds a new element to Denver’s longstanding annual benchmarking requirement. During performance evaluation years, building owners must now have their benchmarking reports verified by a qualified third party. Building owners and their data verifiers will be required to complete ENERGY STAR Portfolio Manager’s data verification, sign the form, and keep it on file. Third-party data verifiers must hold one of the following licenses, credentials, or certifications: Professional Engineer, Licensed Architect, Certified Energy Manager, or Building Energy Assessment Professional. If the benchmarking process is contracted out to a vendor, that company cannot be the one who verifies its own data.

Denver BPP Penalties

Denver has two types of penalties for non-compliance with the building energy performance requirements: target penalties and maintenance penalties.

In 2025 (2026 for most buildings that qualify for the one-year timeline adjustment described above), 2028, and 2031 the City of Denver will check buildings’ annual benchmarking reports to see if their site EUI performance is at or below the relevant performance target for that year. If a building achieves the performance target, it is in compliance. If not, the building is subject to a target penalty of $0.30/kBtu in excess of the target.

Once a building has attained its 2030 Site EUI target, it must maintain that level of performance indefinitely or be subject to a maintenance penalty of $0.05/kBtu in excess of the 2030 target.

Credit for Purchase of Renewable Energy

Building owners can use qualifying investments in renewable energy to help meet their Site EUI targets. Buildings that have a renewable energy installation on the building site, or whose owners procure qualifying off-site renewable power will receive full or partial credit for every kilowatt-hour that the system generates, regardless of whether the owner retained the Renewable Energy Credits. Denver will give unlimited credit for every kilowatt-hour generated by on-site installations or long-term installations or contracts for off-site renewable power. Qualifying short-term contracts for renewable power can only be used to offset 20% of the building’s electricity usage in 2024, 2025, and 2026. In 2027, 2028, and 2029 the limit falls to 10% and no renewable power purchased via short-term contracts will be credited against a building’s 2030 site EUI.

Equity Priority Buildings

Denver is offering free compliance assistance for buildings that meet the definition of Equity Priority Buildings. Equity Priority Buildings are buildings that serve frontline communities, groups that are more vulnerable to the deleterious effects of climate change. Qualifying buildings will receive free assistance with annual benchmarking and data verification requirements and completing applications for target adjustments. Owners are eligible to apply for an adjusted timeline to align with refinancing cycles or to accommodate other restrictions that limit timely access to capital.

Additionally, the City is piloting advanced services for Equity Priority Buildings including access to Touchstone IQ’s Buildings software, assistance completing Alternate Compliance applications, help drafting retrofit plans and reviewing bids, and assistance in finding financial resources to make energy upgrades.

Work With Denver’s Trusted Building Performance Standards Experts

Touchstone IQ delivers the all-in-one solution you need for ensuring building performance standards compliance along with all other energy requirements needed for your specific property. With leading, hands-on expertise and compliance deliverables from our highly-experienced energy experts to our exclusive platform for supporting your own Denver Building Performance Policy management, enjoy access to everything required for your project in one place. Our leading building performance standards consulting services are here to help you maximize your building’s potential and subsequent benefits. Schedule your free demo today or contact us with questions at any time.

The Denver Building Performance Policy