Flexibility in Compliance

Target Adjustments

You should definitely be checking your benchmarking to make sure you have accounted for any special benchmarking considerations that could lower your energy use or adjust your 2030 target.

You may apply to adjust your building’s 2030 energy performance target for a variety of reasons: 

  • Significant variations in operations or inherent characteristics of the building itself, such as: 
    • Operating hours
    • Parking energy use that you are unable to exclude from benchmarking
    • Swimming pools
    • Data centers (defined in Glossary)
  • Previous benchmarking submissions had incorrect information, like:
    • Wrong building type classification
    • Needed square footage corrections
    • Inaccurate energy data that affects the baseline
    • A high-intensity space (such as a restaurant) was not accounted for in the largest three building types
  • Building alterations:
    • Building type has changed due to a renovation
    • Building has added or demolished square footage with a different or high-intensity property type 

We are currently offering the following target adjustments, based on the Environmental Protection Agency (EPA) methods. More adjustments may be added in the future as the EPA develops additional methodology. 2019 benchmarking data must be verified by a third-party.  

Adjustment Type

Eligible Building Types

Operating Hours

Office, Retail Store, Worship Facility, Non-refrigerated Warehouse, Refrigerated Warehouse, Supermarket/Grocery Store

Indoor Swimming Pool

All building types

Outdoor Swimming Pool

All building types

Parking – open

All building types

Parking – partially enclosed

All building types

Parking – completely enclosed

All building types

Data Centers

All building types with Class B data centers

For all adjustment requests, you will need to submit the following: 

If you are a building owner that is currently on or are planning to join the Denver District Cooling Loop, please reach out to the Help Desk at energizedenver@denvergov.org after the submission of your first benchmarking report with district chilled water usage. Because you are on this loop, we will apply a target adjustment to your 2030 target. Current Denver District Cooling Loop users will automatically have a target adjustment applied in February 2024. This adjustment does not require an application.

Deadline for Target Adjustment Submissions 

You can apply for a target adjustment at any time. However, you need to be aware of the impact the adjustment could make, not only on the 2030 targets, but also the interim targets. The earlier you submit the application, the better off you will be when it comes to performance evaluation.  

  • If you would like the target adjustments completed before the beginning of the first performance period in calendar year 2024, the deadline for submission is October 1, 2023
  • To have the 2024 Interim target adjusted before performance evaluation in 2025, the deadline for submission is December 31, 2024.  

 

Electrification Adjustments

Xcel Energy’s goal is to reach 80% renewable electricity by 2030. The more we rely on electricity to run Denver's buildings, the more we reduce Denver’s greenhouse gas emissions. Because of this, we are incentivizing you to electrify your building as part of the performance requirements. The Performance Policy does NOT require you to electrify your space or water heating equipment. However, the Denver Building and Fire Code will require existing buildings to partially electrify their equipment at the end of system life starting in 2025

If at least 80% of your building’s total energy use comes from electricity, we will make your 2030 target 10% easier to reach. For example, if your target is an EUI of 50, we would give you a 10% "bonus," making your new target a 55. There are two ways to get this “bonus:"  

  • For buildings that already use at least 80% of its energy from electricity (based on the 2019 baseline), the city will add your 10% "bonus” automatically. We will notify you of this change in early 2023.
  • If you plan to reach 80% electrification by 2030, you can apply for an Alternate Compliance Option (ACO). Once the city approves your ACO, we will adjust your final Performance Requirement to reflect the 10% “bonus.” Please note with this method, you will face penalties if you fail to reach 80% electrification because you are signing an ACO agreement that becomes your compliance plan. 
  • MAI Buildings are eligible for a Fossil Fuel Reduction Credit instead of the Electrification Credit

The city will calculate your percent electricity when we check your performance with the 2024, 2027 and 2030 targets. If we find that you have reached 80% electrification, we will add the 10% EUI “bonus” to your target before we apply renewable credits and check EUI performance. 

The Renewable Credit

We want to see more renewable energy capacity built and added to our electric grid. Xcel Energy incentivizes a large percentage of the renewable energy projects in Denver. Xcel retains the Renewable Energy Credits (REC) in exchange for those incentives. Because of this, Energize Denver will give you credit for renewable generation regardless of who owns the RECs.  

We will credit on- and off-site solar or wind power generation to the building’s total energy use before we evaluate performance targets. Renewable energy generation will count whether you retained the RECs or not. There are caveats for long and short-term installations or contracts. We will calculate the credit on an annual basis, based on generation from the 12-month performance period being evaluated.  

Check out the new Building Performance Forecasting Calculator to see how renewable energy generation can affect your EUI.

Long-term Installation or Contract Requirements:

  • On-site installation: proof that you have installed solar or wind. 
  • Off-site installation: proof of interconnection and permission to operate
  • Off-site owned by third party: evidence of a subscription, lease, or purchase of a share in either a voluntary renewable energy program offered by Xcel Energy OR a community project located in Public Service Company of Colorado territory. The term of purchase must be at least five (5) years and must be renewed a minimum of every five (5) years for the life of the building 

 

Short-term Contract or Subscription Requirements:

Short-term contracts will be allowed on a declining scale to assist building owners with interim targets. These short-term contracts must meet several standards:  
  • Like long-term contracts, they must be through an Xcel Energy program or a community project located in Public Service Company of Colorado territory.
  • The contract must be at least 12 months long. 
  • The contract must cover all 12 months of the performance period we analyze for your interim target. 
  • You must renew the contract annually for maintenance of the target through the next interim target date. 
  • If you wish to use renewable credits for your 2030 target, you should replace short-term contracts with long-term contracts over time.  

We will allow short-term contracts for renewable generation on the following scale: 

  • 2024, 2025, 2026: up to 20% of the building’s electricity usage
  • 2027, 2028, 2029: up to 10% of the building’s electricity usage
  • 2030 and beyond: short-term contracts not allowed 

 

Examples of Renewables in Denver

Type of Contract

Possible Program

Solar/Wind power generated capacity on-site

Long-term

Net Metering, Solar*Rewards

Solar/Wind power generated capacity off-site

Long-term

Off-site solar or wind

Multifamily building where tenants purchased solar through Community Solar Garden subscription

Long-term

Solar*Rewards Community

Community Solar Garden Host (credit available if a portion of kWhs generated are distributed to building directly)

Long-term

Solar*Rewards Community

Subscription for solar and/or wind power generation (5 years minimum contract)

Long-term

Renewable*Connect

Subscription for solar and/or wind generation (month-to-month or less than 5 years)

Short-term

Windsource

You will need to submit information on energy generation every year to receive the Renewable Credit. You will need to prepare the following information before going to the submission form:  

  • Total kWhs generated or purchased during the 12-month performance period
  • Which type of installation or contract it is (long vs. short term)?
  • Were the RECs retained?
  • A copy of the ownership paperwork or contract (you only need to submit this once)
  • Upload one month’s example of a bill or report that shows the kWhs generated in that year

Apply for the Renewable Credit

 

 

Alternate Compliance Options

A building owner may apply for one of the following alternate compliance options (ACO).  This section outlines the minimum requirements for documentation and process for requesting each type of alternate compliance option.

Timeline Adjustment for All Benchmarked Buildings for 2024 Target

Denver has approved a one-year timeline adjustment to the 2024 target for all buildings that have a complete 2021 calendar year Benchmarking Report (2022 Reporting Year) on file with the city. For those buildings, the first interim target will be due in 2025 (95% of Denver's buildings have received this adjustment!). For buildings that did not benchmark their 2021 calendar year, you still have time to turn in your 2021 benchmarking! Please contact the help desk for more information. You can look up your building's due dates and EUI targets in the new Performance Requirements Look Up Tool.

 

Minimum Requirements:

Required documentation varies for each type of alternate compliance option: 

For information on which documents are required for each type of alternate compliance option, see the submission lists within each alternate compliance option’s description.   

 

Timeline Adjustment

You can apply for an adjustment to your compliance timeline. There are a variety of reasons that we accept, understanding that they could make achieving the interim or 2030 targets difficult. You can apply for a timeline adjustment that addresses just one target (such as 2024 only) or multiple targets with a single application. If 80% or more electrification of the whole building is the reason for the delay, the building will receive the 10% electrification bonus on the EUI target as part of this process. 

Reasons to seek a timeline adjustment include, but are not limited to: 

  • Planning for end of major equipment system life (according to service life chart in Appendix C of the Technical Guidance(PDF, 2MB))
  • Planning for major renovation
  • A Landmark Preservation Commission review process means the work won’t be done in time for a target deadline
  • Financial distress defined as:
    • The building is the subject of a qualified tax lien sale or public auction due to property tax arrearages
    • The building is controlled by a court appointed receiver
    • The building has been acquired by a deed in lieu of foreclosure.
  • Electrification of space and water heating equipment or the entire building
  • You have a 1-year benchmarking exemption for the performance period of an interim or final target
  • Steam loop district system limitations
  • Energy service capacity issues (see the last question on our Frequently Asked Questions)
  • Pending demolition within 2 years after a target due date
  • You are taking an innovative approach to energy efficiency in your building which results in implementation delays inherent in novel designs. Usually this happens because you are pursuing innovative energy efficiency measures or strategies that have not been widely implemented by the local building industry. Delays may include: 
    • A longer design development process
    • Lengthier permit review process
    • Extended product lead times
    • Prolonged installation timelines
    • Equipment troubleshooting and commissioning
  • A change of building ownership where the new building owner will have difficulty complying on time (for example, if the new owner purchases the building in 2024 and the previous building owner did not make progress towards the 2024 target). 
  • Under-resourced buildings may qualify for additional reasons not listed, such as financing cycles for qualified affordable housing buildings, considered on a case-by-case basis

We will consider other reasons on a case-by-case basis 

Natural or man-made disasters that affect your ability to meet the performance target deadline (such as fire, tornado, flood, etc.) may qualify for a timeline adjustment. We are investigating a simpler application process for these cases.  If you have experienced a situation that you think may qualify, schedule a discussion with the Office of Climate Action, Sustainability and Resiliency before starting the application process.  

Application:

The Timeline Adjustment application for a single building includes:  

Deadlines: 

Deadlines for submitting an application are dependent on the target date that needs adjustment and early action to get reduced penalty rates. For buildings with a 2025 interim target:

Target

Application Deadline

Alternate Compliance Penalty

2025

June 30, 2024

$0.30/kBtu not achieved

2025

December 31, 2024

$0.35/kBtu not achieved

2025

December 31, 2025

$0.40/kBtu not achieved

2025

Received After December 31, 2025

$0.50/kBtu not achieved

If you have a 2024 interim target or are an MAI building, see the Technical Guidance for your application deadlines.

 

Timeline Adjustment Agreement: 

After we have completed our review of your submission, we will use the agreed-upon retrofit plan to create a legally binding Timeline Adjustment Agreement as the new performance requirement for the building. The agreement will include:  

  • Details of the retrofit plan
  • The agreed-upon timeline
  • Reporting requirements 
  • Penalties that will be assessed if the plan is not completed as agreed.   

Electrification

This alternate compliance option is for building owners that would like more certainty in applying the electrification credit at the time of ACO approval and working towards established interim and final targets. Working through this ACO means that 80% minimum electrification of the building becomes a requirement of the compliance plan.  

To apply for this Alternate Compliance Option, you must submit: 

30% Reduction Property Types

Some building types have a simple 30% energy use reduction goal instead of a 2030 EUI Target. This is because of their unique building types and a lack of national or local data. However, a 30% energy use reduction may not be appropriate for every individual building. This ACO outlines a process for you to work with the Office of Climate Action, Sustainability and Resiliency to determine the appropriate energy reduction goal. If the Landmark Preservation Commission has limited what energy efficiency measures you can perform in your historical building, you could apply to this alternate compliance option.  

Eligible building types: 

  • Aquarium
  • Convention Center
  • Ice/Curling Rink
  • Indoor Arena
  • Museum
  • Other – Entertainment/Public Assembly
  • Other – Technology/Science
  • Transportation Terminal/Station
  • Zoo
  • Historical buildings where the Landmark Preservation Commission has limited the energy efficiency measures the building can take 

 

The application includes: 

 

 After we receive the application and supporting documentation: 

  1. We will review and compare the building’s benchmarking information to national medians and local site EUI data on buildings of the same property type. 
  2. We will schedule a meeting to discuss opportunities identified on the ASHRAE Level 1 spreadsheet. We will reference the 30% reduction goal and look at a possible target adjustment. 
  3. If you disagree with the first target adjustment we present, we will need additional informational to make a more thorough assessment. You will need to follow the procedures for a timeline adjustment and turn in additional information.  

 

Manufacturing, Agricultural, and Industrial (MAI) Buildings

Manufacturing, Agricultural, and Industrial (MAI) Buildings have several compliance pathways and metrics available so that you can customize a compliance plan based on your building's needs and operations. These compliance pathways and metrics were designed to meet the unique challenges these building types see as they work towards their performance targets.

See more about the MAI Alternate Compliance Option

 

Compliance Assistance for Equity Priority Buildings

Equity Priority Buildings serve frontline communities with less access to resources, who may face more barriers adapting to a changing climate. The compliance assistance program determines Equity Priority Buildings based on various criteria. Buildings may qualify for compliance assistance with the Energize Denver Performance Policy, if your building:
  • Is more than 30% regulated affordable housing units
  • Is located in Denver’s NEST neighborhoods with a high prioritization ranking on the equity index and serves frontline community members
  • Has significance to the neighborhood and serves frontline community members
  • Has human service providers as tenants or owners responsible for HVAC systems and/or utility bills
  • Is located in a Census tract below the Denver median income and meets one of the following:
    • In a census tract with a high prioritization ranking on the equity index
    • Serving frontline communities
  • Provides affordable rents, defined as being below 1/3 of the monthly Denver median income
  • Has a mission aligned with corporate social responsibility values such as livable wages, health benefits to employees, hiring a local workforce, donating profit to charities or causes, etc.

Qualified buildings will receive long-term free compliance assistance in meeting Energize Denver's Performance Requirements. This assistance goes beyond what the Energize Denver help desk typically provides. The service level a building receives will be based on the information you submit in your eligibility application, the building’s equity index score and prioritization, and available funding in the program.  

Compliance assistance will take a phased approach, starting with Benchmarking and Data Verification assistance. This ensures that Equity Priority Buildings correctly submit their benchmarking data and understand their EUI targets.