Many of you have likely seen recent news reports from early May 2025 indicating that the ENERGY STAR program is facing elimination as part of a broader EPA reorganization. The reports are confirmed. This is a critical issue we need to address, particularly because the ENERGY STAR Portfolio Manager (ESPM)—a tool integral to our operations—falls under the umbrella of the ENERGY STAR division that is on the chopping block. As of late 2021, ESPM was actively used by over 465,000 commercial buildings (including multifamily properties), representing nearly 25% of all commercial floor space in the U.S.
This situation, despite some ongoing efforts like planned ESPM upgrades funded by the Inflation Reduction Act, presents considerable uncertainty. The question we must all contemplate is: “DO YOU THINK THE POTENTIAL DISAPPEARANCE OR RADICAL ALTERATION OF ESPM IS A PROBLEM FOR OUR INDUSTRY?”
I am deeply concerned that it is, and here are some key reasons why:
1) What Happens to Our Data if the Plug Is Pulled?
This is our data. Collectively, we have invested possibly millions of dollars and countless hours over 25 years inputting, correcting, verifying, assuring, and utilizing data within ESPM. This data is crucial for reporting to lenders, ensuring compliance with jurisdictional mandates, and communicating with investors. If ESPM is abruptly discontinued:
• Is all that historical data lost?
• What is the plan for data migration or retrieval?
According to current EPA policy, the individual or entity that creates a property in Portfolio Manager is the “Property Data Administrator” and retains the rights to that data. However, the practicalities of accessing or transferring massive datasets in the event of a shutdown are unclear.
2) Privatization of ESPM: A Pandora’s Box for Costs and Data Security?
If ESPM is eliminated and a private entity takes over or offers a similar service, several issues arise:
• a) Will We Have to Buy Back Our Own Data? ESPM is currently a free tool. A private company will inevitably seek to monetize its services. Could this mean having to pay fees to access data we originally owned and inputted?
• b) What Prevents Data Misuse in a Privatized Scenario? Consider the precedent of data monetization seen with other platforms. If ESPM data becomes a marketable asset, what stops a competitor from purchasing your operational data? Imagine the implications for competitive fee management agreements if your building’s performance data could be used against you. While the EPA currently aggregates and anonymizes data for public research, a private entity might not operate under the same constraints.
3) Compliance Costs Could Skyrocket
Over 50 jurisdictions (cities, states, and counties) currently require utility benchmarking and/or adherence to Building Performance Standards, often relying on ESPM for data submission.
• If ESPM disappears, will each jurisdiction develop its own unique platform? This would necessitate learning multiple new systems, significantly increasing the administrative burden and costs, especially for portfolios spanning various markets.
• Even if alternative platforms like the Department of Energy’s SEED platform (which can integrate with ESPM) gain traction, a transition period could be chaotic and expensive. Jurisdictions would also incur costs to adopt and manage new tools, potentially passing these on.
• Outsourcing these increasingly complex tasks to consultants would also undoubtedly lead to higher operational expenses.
4) Green Loan Reporting Requirements Jeopardized?
Many green loan programs, including those from HUD, Fannie Mae, and Freddie Mac, stipulate annual data submission and reporting, frequently facilitated through ESPM. The discontinuation of ESPM would create significant hurdles:
• How would we continue to comply with the terms of these loans?
• What would be the accepted alternative for benchmarking and verifying energy performance for these financial instruments?
A Call for Preservation (and Preparedness):
While ESPM may not be a perfect tool, it is the established, free, national standard that our industry heavily relies upon. Since elimination of the ENERGY STAR program is now inevitable, strong consideration should be given to protecting and preserving ESPM. Its loss would create a significant vacuum, increase costs, and disrupt established reporting mechanisms.
See the companion article outlining the case for optimism here.
