“This is Colorado taking the lead on a challenging climate problem, and doing so with a really thorough process informed by stakeholders, by industry, by advocates,” says Alejandra Mejia-Cunningham, an advocate with the Natural Resources Defense Council’s building decarbonization, climate and clean energy program.

A concern raised by owners is the cost of meeting the rule, estimated at $3.1 billion by the Denver Metro Building Owners and Managers Association and $2.6 billion by the state. The state also says the cost of compliance would be offset by $9.2 billion in lower utility bills and other savings, through 2050.

While it may take time for those savings to add up, Colorado Energy Office officials pointed to various programs that building owners can turn to for funding, such as the state’s High Efficiency Electric Heating and Appliances grant program, Geothermal Energy grant program, Commercial Property Assessed Clean Energy Program and Colorado Clean Energy Fund. 

There are other concerns about unintended impacts and challenges associated with compliance. For contractors, it may prove difficult to meet owners’ demand for retrofits because of a likely labor shortage, Michael Gifford, president and CEO of the Associated General Contractors of Colorado, wrote in a comment ahead of the commission’s vote. The state’s construction workforce “has been stuck at 180,000” employees for more than three years, with the state unemployment rate already below the national average, said Gifford.

Additionally, retrofitting 8,000 buildings by 2027 would mean a pace of 38 per week, Gifford warned, adding it “will be impossible to achieve” the benchmarks on schedule. 

However, all buildings that fall under the rule may not require retrofits, says the state. Newer buildings may already meet the standards, according to the Colorado Dept. of Public Health & Environment. About 40% of buildings covered by the rule already meet the 2026 target, and 20% meet the 2030 target standards. The figures are based on two years of building energy use intensity data reported to create benchmarks.

The rule also provides flexibility for building owners to meet the standards, Mejia-Cunningham says. While energy efficiency may be found through retrofits like adding insulation, wrapping pipes, replacing windows and switching to LED lights, owners can also reduce energy use by installing occupancy sensors on lights or running mechanical equipment at off-peak hours. Electric heat pumps, which are more efficient than alternatives, can also help, she adds. 

And owners also have the option to request a timeline or target adjustment from the Colorado Energy Office, officials note. 

Several dozen cities and counties across the U.S. have also implemented their own building performance standards. Denver is one of them, and Mejia-Cunningham says Colorado’s new standards followed Denver’s lead in terms of structuring. 

“A lot of it was inspired and rooted in the hard work of the city of Denver staff, as well as the really thorough community-led, equity-forward process they undertook to inform the city’s BPS,” she says. 

There are two main differences between the Denver and Colorado standards. The statewide standard applies only to buildings 50,000 sq ft or larger. The city standard has tiers for smaller buildings. Also, the state standard has more exemptions.