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Are your clients getting ahead with regards to the Climate Mobilization Act?
AUTHORGeoffrey Mazel, Hankin & Mazel
The Climate Mobilization Act is a huge piece of legislation for co-ops and condos in New York. Are any of your clients getting ahead of the game?
First, I'm educating them on the statute. If you’ve read the statute, you know it’s very difficult to navigate. The one thing we all understand, though, is that boards have to reduce their buildings’ carbon emissions. Five years from now is when you need a plan, and 2030 is when you need to get in gear and reduce your emissions by 40 percent. I've advised my clients to start looking at their systems and start thinking of ways to reduce their emissions. Several are looking into solar-energy projects.
That's a big one because they won’t have to get their electricity from fossil-fuel-fired electrical plants. What are your boards doing?
Well, the payback and the economics of solar projects are much better than they were 10 years ago. Years ago, it didn’t make sense economically. Now it makes sense. Under one model, the solar panels generate electricity that is fed into the Con Ed grid, and the co-op gets credits for that. Even though the electricity isn’t used by the co-op, the building has reduced its carbon footprint.
What are specific projects your clients are working on now?
I have about four clients that are involved with large-scale solar projects. They vary in many ways, including where the panels are placed, how they're financed, and how it will affect the co-op economically. I have one project where solar panels are simply on the roofs of the co-op. That’s sort of cookie-cutter. It was fully financed by the co-op, and the electricity generated is going back into the grid. On the opposite end of that, another client is installing carports with solar panels on top of them. So this co-op will not only have covered cars, they'll be generating electricity. Another innovative aspect is that it’s being financed completely by a third party, and the co-op in essence is getting an annual royalty for 20 years. It’s not lucrative, but it’s a win-win because there’s no outlay, and they’ll be reducing their carbon footprint.
You're not an engineer or a solar expert. What is your role in this as a lawyer?
I'm general counsel, so it's my job to help co-ops function and help them comply with this act. I can help them put a project together. It's a team effort, and to use a sports metaphor, I'm sort of the quarterback. I review and negotiate all the contracts with all the professionals – the engineer, the project manager, the contractor. I have to make sure everyone’s role and the timetables are defined, and that everyone’s playing their part. These projects have a lot of moving parts – tax credits, construction, financing – and I might have to get opinions from NYSERDA [the New York State Energy Research and Development Authority], Con Edison, and the city’s Department of Finance. The tax breaks change all the time.
When is it time for boards to start dealing with the Climate Mobilization Act?
Yesterday. Carbon emissions need to be reduced 40 percent by 2030 and 80 percent by 2050. Those sound like faraway dates, but we’re talking about a game-changer. Co-ops that have been burning oil or gas the same way for years will have to do something – maybe cogeneration or solar. So the projects are going to be generational, such as windows or roofs and boilers, and boards need to get ahead of it now, start generating money now, and not wait till the last minute. Those deadlines are closer than they appear.