Chevron deference and BPS

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Mary explains the impact of ending Chevron deference

One of my favorite lines from “Raiders of the Lost Arc” is “They are digging in the wrong place!” That is exactly how I feel with people interpreting the recent overturning of the 1984 Supreme Court ruling colloquially referred to as “Chevron” or “Chevron deference” as impacting building performance standards (“BPS”) compliance.

If you are unaware of this decision, briefly, Chevron deference allowed federal agencies to fill in details when laws (environmental, consumer, etc.) were not clear. The result of it being overturned is that persons disagreeing with an agency’s approach to filling in the statutory blanks can now challenge that approach in the courts, not just with the agency itself.

There is an assumption out there that this will affect the existing thirteen markets that have BPS requirements and undo the fines associated with noncompliance. Additionally, there is speculation that it will soften the looming requirements for compliance (or fines for noncompliance) in the thirty plus markets that IMN shows as pending BPS. This is incorrect.

The overturning of Chevron deference affects federal agencies only. All BPS in place today are at a state level or lower (County, or City). They are not federally established, interpreted, or mandated. As it stands, BPS compliance is not and will not be affected by the end of Chevron deference.

Do not get me wrong, BPS is H.A.R.D. Every jurisdiction has its own goals and structures for fines. They have different targets including energy use intensity, carbon, etc. Some apply at the building level, and some apply at the property level. Some have exemptions and some do not. For example, the City of Denver has a BPS requirement and so does the state of Colorado, and they are different. You could meet compliance requirements for one but not the other! It is confusing and complicated, especially if you have properties in multiple markets and must keep track of the various requirements.

I recently attended a webcast hosted by the Department of Energy on BPS and one of the questions asked was “do you think we can have a federal standard on BPS to reduce the confusion and difficulty?” Sadly, the answer was “No” and that was before the overturn, which reinforces that no.

BPS will continue to evolve, but it will be at a local level. This means that, if we dispute, we must take on potentially hundreds of jurisdictions with no ability to aggregate. There will be no federal support to compel utility companies to provide us with whole building data so we can make better decisions. Sorry to be a negative Nelly, but the overturning of Chevron deference does not make our lives easier with respect to BPS.