New York, NY – In New York City, Renewable Energy Credits are coming on the market this Friday, August 14. A renewable energy credit (REC) enables large entities like corporations or governments to purchase a certificate representing environmental benefits of renewable energy sources. RECs are used to help buildings meet emissions caps set by Local Law 97 without actually reducing their emissions. 

A flood of new, likely inexpensive RECs associated with the recently completed Champlain Hudson Power Express (CHPE) transmission project are expected to go on sale this week, through a loophole created by the Adams administration. It is urgent for Mayor Mamdani to take action on his campaign promise* to close the loophole.

“Mayor Mamdani should remember his campaign promises, and step up to protect New Yorkers from corner-cutting billionaires who will abuse this loophole to line their own pockets and gut the efficacy of Local Law 97. Unless Mamdani takes immediate action to close Eric Adams’ landlord loophole and limit RECs, we’ll be left paying the price with higher energy bills, more air pollution, and thousands of lost jobs,” said Graham Gale, New York City organizer with Food & Water Watch. 

“So far, far above 90% of buildings are complying with Local Law 97, which is creating thousands of jobs, reducing pollution by hundreds of thousands of tons, and cutting utility bills through energy efficiency. The city’s major progress is threatened by the REC loophole, which Mayor Mamdani pledged to close. With RECs going on sale now, New Yorkers will start to lose substantial benefits as landlords begin to buy RECs in place of investing in cleaning up dirty buildings. It’s time for the Mayor to close this loophole to ensure large building owners can’t skate away from investing in their properties,” said Pete Sikora, climate & inequality campaigns director for New York Communities for Change.

Background: 

Local Law 97 (LL97), New York City’s landmark climate law which was signed into law in 2019, places limits on greenhouse gas emissions in buildings over 25,000 square feet. Former mayor Eric Adams created a loophole for large building owners that allows landlords to fall short of the emission reduction limits set forth in Local Law 97 as long as they purchase Renewable Energy Credits, or RECs. Acting in favor of the Real Estate Board of New York (REBNY), Adams established the purchase of unlimited quantities of RECs. Despite guaranteeing to close the Adams loophole, Mamdani has failed to take action to limit RECs for LL97 compliance.

With unlimited RECs potentially available at a low price to the city’s largest buildings, landlords are incentivized to purchase credits instead of making necessary upgrades to legitimately lower pollution from their building. New York City does not control the price of RECs, but the city can limit how many RECs can be used as a LL97 compliance mechanism through immediate rulemaking on the city level. Urban Green Council estimates that 50% of emissions over the 2030 limit could be offset using RECs, derailing progress already underway to improve public health, reduce air pollution, create thousands of new green jobs, and help New Yorkers save on energy.  

*Relevant timestamps from Feb 2025 mayoral forum: 13:30-19:30, 24:15- 25:50, and 29:30-32:30

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