Commercial real estate developers are crying foul over an effort by Maryland Democrats to pass sweeping climate legislation that would change building energy and emissions standards. The proposed Climate Solutions Now Act of 2022 would, among other things, ban new construction beginning in 2024 from using fossil fuels for heating and hot water and require some existing buildings to achieve net zero emissions by 2040. .
Property developers say the new standards are prohibitively expensive and the rule’s timelines are unrealistic. They also argue that there aren’t enough tax incentives to help make properties more energy efficient. The standards also include penalties for owners who fail to meet emissions targets. “Where will the currency come from?” said Sen. Benjamin F. Kramer (D), who owns commercial buildings. “[Lawmakers] are already fighting and fighting for every penny of the budget.
The property developer’s objections highlight some of the tension between acting now on climate change and the cost of more aggressive efforts to decarbonize the global building stock. More and more cities, states and municipalities around the world are setting net zero emissions goals for buildings, and the price tag associated with them is not cheap. Achieving net-zero emissions globally by mid-century, while unrealistic, would cost an estimated $1-2 trillion a year in additional investment, or about 1.5% of global GDP, according to a report by the Commission for Energy Transition.
Many argue that the short-term financial pain is worth avoiding the long-term, and some say irreversible, climate damage. But just as many are shocked by the rising cost of gas in recent weeks, we will see whether objections to higher prices during an energy transition crowd out the long-term vision of reducing greenhouse gas emissions from 2050. Gathering the political will, let alone coordinating hundreds of diverse economies, to tackle something as massive as global warming will not be an easy task.