Emergent Energy Solutions Editorial TeamJuly 22, 20246 min read

This fact sheet from the Commercial Energy Policy Toolkit provides guidance for local governments on overcoming the split incentive problem through submetering policy.

The split incentive — where building owners pay for efficiency upgrades but tenants reap the benefits through lower energy bills — is one of the most persistent barriers to energy efficiency in commercial real estate. Submetering addresses this by making energy costs transparent and attributable to individual tenants.

The toolkit offers policy frameworks and implementation strategies that local governments can adopt to encourage or mandate submetering in commercial buildings, aligning the interests of landlords and tenants around energy efficiency.

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