Energy Audit Requirements

I think this topic might actually be relevant for this subforum too, especially since so many businesses operate out of leased office spaces or even just run out of an owner's residential condo.

I’ve started looking into getting these certifications for some commercial buildings, apartments, and rental units, and honestly, it’s been a headache of conflicting explanations and shifting deadlines. I even saw the Department of Commerce changing their guidelines on their website mid-process.
What’s currently in effect—and what I found useful—is this breakdown regarding deadlines and FAQs.

I’ve seen plenty of ads promising to handle the certification process, but the "teaser" prices they advertise rarely match the actual quote you get once you send them a specific inquiry.

So, what’s your experience been like with this?
How much of a nightmare is it to actually secure one of these certificates?
Is there anything specific I should be watching out for?

Any advice for us total rookies? 😁

Thanks lili p. for the links! I'll probably roll up my sleeves and dive into these tomorrow, but for now... 🙂

Lili, if you need a hand with any of this, just shoot me a DM or an email... I’ve got a client who, in my opinion, does this work at really fair prices...

He handles more than just energy audits—he does permitting and zoning stuff too. For a recent project, he charged me half of what a local architect out in Napa Valley wanted, even though he was working all the way from NYC 🙄... so honestly, my advice is to get a few different quotes before you decide.

Thanks, devil.

Right now, I’m just staring down a mountain of paperwork I need to organize before I sign off on an offer.

From what I can gather regarding the leasing requirements, any space being rented out is going to need this certification. It’s valid for ten years, which isn't a bad deal if you think about it.

But here’s what’s bugging me: what happens when a business just leases a single office within a larger building? I’m assuming they'd have to certify the entire property instead of just their own little corner, right?

Since I haven’t turned up an answer yet, I figured I’d bump this thread.

Do small business owners or LLCs that don't have a formal lease agreement—meaning their business is registered at their own home address—actually need to carry an energy certificate?

I’m guessing most of us are working from home now,
so this rule applies to any building over 50 square meters (basically anything bigger than a tiny studio)
the deadline for owners is January 1st, 2016.

Long live Europe!

Clarification regarding the requirement for energy certificates from Yelp:

Because the Department of Housing and Urban Development keeps getting flooded with questions about whether you actually need an energy certificate when renting out a building or a specific unit within one, they’ve put out this official explanation:

The Building Code (as published in the Federal Register) brings the European Parliament and Council's Energy Performance of Buildings Directive (Directive 2010/31/EU) into the American legal framework, and it's been in full effect since January 1, 2014.

According to Section 23, Subsection 1 of the Code, an energy certificate must be issued for any building—or a specific part of a building—that requires energy to maintain its internal design temperature for its intended use. There are some exceptions, though... specifically for buildings with a lifespan of two years or less, buildings used for religious services, industrial buildings, workshops, non-residential agricultural buildings with low energy needs, or anything with a total usable area under 50 square meters.

Moving on, per Section 24, Subsection 2 of the Code, if you’re a property owner looking to sell, rent, lease, or enter into a rental agreement for a building or a specific unit, you are legally required to obtain an energy certificate first. As far as the sale of property goes, this obligation has been part of the American legal landscape since we fully joined the European Union back on July 1, 2013.

Now, the rule requiring these certificates for rentals, leases, or sublets falls under Section 203 and officially kicked in on January 1, 2016. And just to be clear, "renting" in this context includes short-term vacation rentals too... so, owners of vacation apartments have been required to grab an energy certificate since January 1, 2016, provided the building itself is over 50 square meters. If the apartment is part of a larger building that exceeds 50 square meters, you need the certificate regardless of how small the individual apartment unit actually is...

Just a heads-up, Section 171 lays out some pretty heavy fines for anyone cutting corners. We're talking between $5,000.00 and $3333 for individuals, and anywhere from $15,000.00 to $10000 for corporations acting as building owners, if they fail to secure an energy certificate before selling, renting, or leasing the property.

Compliance and enforcement of these specific rules are handled by the relevant consumer protection and trade inspection agencies.

Henry Edwards33 said:Since I haven’t turned up an answer yet, I figured I’d bump this thread.

Do small business owners or LLCs that don't have a formal lease agreement—meaning their business is registered at their own home address—actually need to carry an energy certificate?

What about businesses or contractors who *do* have a lease agreement (they aren't the property owners)? Do they need an energy certificate too?

Also, if an individual owns three commercial properties that have been rented out for years, do they need energy certificates (per the regulations since early 2016)? These leases were signed for long terms with two small businesses and one corporation, and they run until 2018...

Donna Jones26 said:What about businesses or contractors who *do* have a lease agreement (they aren't the property owners)? Do they need an energy certificate too?

Also, if an individual owns three commercial properties that have been rented out for years, do they need energy certificates (per the regulations since early 2016)? These leases were signed for long terms with two small businesses and one corporation, and they run until 2018...

I'm honestly not following what you're asking here... If you're just the tenant renting the space and don't actually own the building, the responsibility for getting that energy certificate doesn't fall on you at all...

Donna Jones26 said:What about businesses or contractors who *do* have a lease agreement (they aren't the property owners)? Do they need an energy certificate too?

Also, if an individual owns three commercial properties that have been rented out for years, do they need energy certificates (per the regulations since early 2016)? These leases were signed for long terms with two small businesses and one corporation, and they run until 2018...

Yes, they do.

@ruggedlynx63, does the landlord actually have to provide a certificate even if the original 10-year lease from 2008 doesn't mention anything about one?
Do we need to go through the hassle of drafting new lease agreements or an addendum?...

Donna Jones26 said:@ruggedlynx63, does the landlord actually have to provide a certificate even if the original 10-year lease from 2008 doesn't mention anything about one?
Do we need to go through the hassle of drafting new lease agreements or an addendum?...

Look, I’m an accountant, not a lawyer, so this isn't strictly my lane, but I’m speaking from direct experience since I personally lease out two commercial properties myself... and that’s exactly what my tax advisors and an energy certification specialist told me. I wouldn't say you need a whole new contract—the energy certificate is its own thing and shouldn't have anything to do with the actual lease terms. But here's the deal: since January 1, 2016, having an energy certificate is a mandatory requirement for landlords, plain and simple, and you'd better get it done unless you're looking to get slapped with a massive fine. It doesn't matter at all that you signed that contract way back in 2008; if you're renting out that space or building after the 2016 mandate kicked in, that property absolutely must have an EC...