Aligning GRESB Data: North American Building Standards & Benchmarking Laws

In this episode of The Pulse by GRESB, we explore the growing convergence between building performance standards, benchmarking requirements, and GRESB. The conversation examines how real estate managers can strengthen the quality of their building performance data, streamline compliance processes, better understand regulatory and financial risk, and use these insights to inform capital planning and investment decisions. Tune in to learn how a stronger approach to building performance data can support more informed decisions and long-term asset value.

Can’t listen? Read the full transcript below. Please note that edits have been made for readability.

Reid Morgan: Hello, and welcome to The Pulse by GRESB, a content series featuring GRESB team partners, foundation members, other experts, where we focus on an important topic related to GRESB or issues within the real assets industry. This is Reid Morgan. I’m Director of Account Management here in the US, and I’m joined by founder and CEO of Abisko, Rimas Gulbinas. Rimas, good to have you with us. Thanks for joining.

Rimas: Thanks, Reid. I’m happy to be here.

Reid Morgan: Awesome. We are gonna focus today’s conversation on building performance standards and GRESB alignment. As many people are aware, there are a lot of requirements out there for collecting data, reporting data, benchmarking laws, and in many cases, there are nuanced differences around how to get this information in the right format, submit it properly.

This is just two of, we’re just talking here, benchmarking laws, BPS and GRESB, and there’s many more. So Rimas, I wanna focus a little bit on how you address this, what solutions you bring to the market and how Abisko has been addressing these challenges.

Rimas: No, thank Reid. It’s a real pleasure to be here. And I think for anyone who’s been in the industry for the last decade, you can’t really avoid the shift in the discussion from kind of just voluntary disclosure to the impact of compliance requirements across North America. And I think it’s first important to understand the differences between, say, benchmarking and building performance policies, right?

So, benchmarking policies require owners to track and annually report building energy and sometimes water data. In most cases, that data is periodically verified by a third party and almost always reported through a platform called ENERGY STAR Portfolio Manager. That’s a free tool that’s provided by the US government. The goal of these policies is basically to get building owners to develop the muscle memory of tracking building and energy data. But there’s no real penalties associated with poor building performance. But that’s really where BPSs or building performance standards come in. Unlike benchmarking laws, these set binding energy and emissions performance targets, which building owners have to meet or really face stiff penalties. So you can think of benchmarking laws as like training wheels for BPSs. And anywhere there is a benchmarking policy, it’s more than likely that there will eventually be a BPS.

Reid Morgan: Got it. Thanks, Rimas. That’s really helpful to set the stage.

So let’s talk about that overlap, how that’s kind of changed over the years, and in that, where’s the opportunity for efficiency in complying with your benchmarking law, being prepared for BPS to avoid those fines, and dialing in your GRESB reporting?

Rimas: That’s a great question. I think it’s helpful to start thinking first about what’s reported for both of these standards and what they’re actually doing GRESB is an investor framework. It’s really meant to give a way for investors to think about where the industry’s going, where to push it to ensure that environmental concerns are part of that discussion. BPSs do a very similar thing, but they look at a little bit of a different set of data, even though there’s a lot of overlap. So at the core, the laws and GRESB require the same performance data. That includes energy and water consumption, location-based emissions, property use information, things like occupancy rates, et cetera.

So I think beyond the data though, the main difference in these laws is that the laws require the data to be collected and reported with a single tool. That’s always ENERGY STAR Portfolio Manager. This is one of the most important, accurate, and widely used tools in our industry for tracking building performance data, and it’s provided for free by the US government.

And the fact that ESPM is required for compliance means that it’s never been more important to ensure that these profiles are fully accurate and complete. And so while GRESB and these laws have slight differences in what’s ultimately reported, ENERGY STAR supports collecting all the information that is required for both.

And so that gives a really big opportunity that allows building owners who are complying with laws to report to GRESB and building owners who are voluntarily disclosing to GRESB to more easily comply with these laws too. So I think there’s a lot of opportunity, but it all kind of starts with ENERGY STAR Portfolio Manager.

Reid Morgan: I’m seeing two things that might be really, really important here. One is the ability to get the data right at the source, and then secondly, similar to like a game of telephone. If this information is gonna be passed along from one thing to another thing, to maintain that integrity, you have to have a really good, clear handoff from one platform to another software system, to another spreadsheet, to another submission, whatever the case may be.

So how do you get it as perfect as possible at the source and then maintain that integrity through the process?

Rimas: Yeah, that’s a really important question too. Because ENERGY STAR’s been around for a very long time and so forever people kind of just thought of it as a nice place to store data, but didn’t take the time and the effort required to ensure that all those configurations are correct, et cetera.

So this whole compliance landscape is forcing a recalibration in that sense, where building owners have to take this very seriously. And so on one hand, ENERGY STAR is great for building level analysis. Every building, you configure your meters, you add data, and so on and so forth, but it’s not really great for portfolio level tracking analysis and management.

And it starts with a full integration, where you also recognize the fact that ENERGY STAR needs to be treated as a source of truth at the end. At the end of the day, you’re reporting to the cities through ENERGY STAR, so even if it’s right into some other source and you’re pushing that to ENERGY STAR, if it’s not actually what you need to report to those cities, you’re gonna get penalized and it’s just not gonna be a good time. So once you recognize that ENERGY STAR is a source of truth, then you actually have to look at like all the configurations. Things like renewable energy credits. How are those configured in ENERGY STAR? Are you getting credit for all the green power, on-site and off-site, in ENERGY STAR? Are your property use details actually fully reflective and properly reflected in ENERGY STAR? All of these things now matter for these reporting requirements, right?

And so, we have some case studies, for example, where for one BPS, somebody realized that a property characteristic was off. One of the property use details. Those characteristics kind of go down the reporting pipeline and inform their emissions limits, for example. And they realized that by correcting this, they’re going to reduce their annual exposure to BPS fines by over a million dollars, just by recognizing the fact that it was incorrectly labeled. Like there’s a ton of opportunities to ensure that these things are right, but it starts with recognizing that ENERGY STAR is a source of truth, and then taking the necessary steps to fix any issues that you find there.

Reid Morgan: That might be a perspective change for some people in this space. Is that right?

Rimas: It’s a big perspective change. It’s very prevalent in the US and Canada. But then when you see users that are tracking this information in ENERGY STAR and what it takes to actually turn around and report to, say, GRESB, a bunch of other things arise because there’s limitations in how ENERGY STAR kind of acts alone.

And one of the most common ones that we see is ENERGY STAR has this concept of in-metric meters. These are required to report whole building data, and they allow you to track what’s called out-of-metric meters, which includes sub-meter data, tenant data, exterior data, parking, et cetera. Now, with a single profile, you can’t report simultaneously, say, whole building for compliance and split level for GRESB. So what we see traditionally in the past, users either maintain two separate profiles in ENERGY STAR, one for GRESB reporting and one for compliance reporting, which is obviously a terrible idea ’cause you have to continuously update both, or they continually reconfigure their meters in a single profile.

And so when they’re preparing to report to GRESB, they’re gonna change the configuration, save that, export things, then unconfigure, go back to compliance reporting, and you can just imagine the amount of errors and headaches that are happening there. So, there are challenges there, but, if you do view ENERGY STAR as a source of truth, you can address those directly.

But, I think it starts with understanding these things, and anyone who’s been in the industry in North America knows how common it is to have multiple profiles for a single building or different configurations, and how error-prone and kind of a pain that is.

Reid Morgan: Yeah. My goodness. I can imagine, you might be able to get away with that with a, you know, portfolio of 10 or 15 or 20 buildings, but as soon as you, you know, 50, 100, 1,000 assets.

This gets really untenable, and you really do need to be thinking about a solution that addresses this, not just some kind of a, you know, a hack that gets you by.

Rimas: Yeah, I don’t recommend it for any number of properties.

Reid Morgan: Well, it sounds like you’ve seen a few different attempts at trying to make this work, which maybe is motivation for why you came up with, you know, your solution here. Is that right?

Rimas: Yeah, no, totally. We wanted to build a solution that is really hyper-focused on compliance management, as one of the pillars, investor reporting as a second, and then integrated decarb planning across all three, but everything has to be in context, right? And so yeah, we have a very big, focus on BPS standards, benchmarking and managing those things, assessing penalties, et cetera.

And we’ve worked with a lot of cities in the past too that are implementing these laws. So we have a front row seat on how these things are evolving.

Reid Morgan: Yeah. Absolutely. Now, Rimas, I remember talking to you last year as things were kind of being put together around this ENERGY STAR to GRESB toolkit specifically. Can we spend a little bit of time talking about that, that sync, and what options are available to folks who may be listening to this to streamline that process, now that we’ve kind of emphasized the importance of ENERGY STAR, you know, understanding, okay, I believe you, we’re gonna get ENERGY STAR dialed in, that’s important. Now, how do we make that push to GRESB as efficient as possible, and make that as painless as it’s ever been?

Rimas: So early in 2025 actually, GRESB approached us, the North American team, and they knew that we’d been working with the EPA in developing this super integrated system with ENERGY STAR. And the theory was, well, how can we create something that really simplifies reporting to GRESB members in North America, reduces costs, streamlines these things, and really increases the accuracy?

And that was essentially the genesis of the ENERGY STAR to GRESB toolkit. And that evolved, since then, beyond just GRESB reporting. But that was, a very special process, right? We worked directly with the GRESB team in Amsterdam, they reviewed a lot of the algorithms, the processes, and ensured strict compliance with all these guidelines.

But since then, we’ve been really integrating more BPS policies and frameworks to allow people, again, to use the same data to assess their exposure, create compliance pathways and decarbonization plans that allow them to get in compliance since then. And so the toolkit continues to expand in that sense, but the general premise still stands.

And that’s to give an extremely accurate, cost-effective way for large portfolios to report. And our whole goal here is to really tie together these efforts across. So if you’re a GRESB member and you want a better solution for managing your compliance across these policies, you have it.

If you’re already just satisfying these compliance requirements and you’ve always been interested to report to GRESB and you need some way to very quickly streamline that and get on board because you might have a small team or a small budget, we want to support that too.

Reid Morgan: We’ve been focusing mostly on tidying up the ENERGY STAR portfolio profile, getting the sync in place to make GRESB reporting really simple, and knowing with confidence that your BPS compliance is in a good place. What additional value have you seen organizations get from this experience?

Rimas: Yeah, there’s a few really fundamental ones. I mean, first it starts with data quality and assurance. So these compliance requirements oftentimes require third-party data verification every few years. And the fact that there is such a regulatory requirement for high quality data, once organizations undertake this effort, at the end of the day, they have much better data that they can assess progress against and integrate into their planning.

So, that’s one additional value that’s unlocked by this. Some other ones are improved valuations. So one of the biggest use cases that we see our clients use Abisko for is understanding what is the exposure of a potential new asset or an existing asset, in a compliance zone. So if you’re in BPS, say Denver or Boston, what kind of penalties are you looking that you might face through every year through 2050, for example. If you have a property that is looking very good and it’s gonna be in compliance without much effort, those properties can demand a premium. There’s much less financial risk, much less regulatory risk, and that’s a huge plus. However, on the flip side, if you’re looking at an asset that’s performing very poorly and is extremely highly exposed to these requirements, then you might reconsider.

And so that’s a very strong value proposition for understanding these BPSs in a deeper context. And then finally, all this starts and ends essentially in better and more informed capital and decarbonization planning. So, when you’re coming up with a decarbonization plan, or energy efficiency improvement plan, people have been doing this in a vacuum.

You understand how you can save energy, reduce emissions for your property, and for some reason that hasn’t really moved the needle in a lot of instances. But as soon as you add compliance risk and penalty exposure, where you might be facing three hundred thousand or five hundred thousand dollars in annual fines, that changes the calculus significantly.

ROIs that might have been five years are now gonna be one year because of avoided costs, things of that nature. So this really unlocks that ability to better inform your capital plans and actually take action and improve your buildings.

Reid Morgan: And to be clear, we are in the penalty period. We are in compliance requirement right now, right? We’ve been talking about this for many, many years, and it’s always been, you know, looking ahead, looking ahead, preparing, preparing, but we’re here, right? This is happening. How has behavior shifted or changed in any way today, versus three or four or five years ago when people were kind of seeing it on the horizon?

Rimas: Well, they’re very heavily invested in understanding that risk. In a way that, like you said, two or three years ago was more hypothetical. And so, we know investors, we have clients, that are preparing these compliance risk analyses for their investors on a quarterly or biannual basis.

It’s something that’s hitting the bottom line, and, a lot of these policies are taking effect this year, next year already. More and more are gonna be coming online, and so people are just starting to get that taste of what it means to be a little behind the curve. And they know that if they don’t start taking action now, that’s gonna turn into a tsunami. It’s a very different perspective today.

Reid Morgan: Got it. Okay. So some urgency. Gotta get this stuff sorted.

So Rimas, one thing I want to touch on as everyone who’s following GRESB or active in submitting to GRESB knows, we have a large initiative right now going on towards the 2028 standards evolution. And that includes a big shift towards recognizing real building performance. That feels very aligned with kind of what we’re talking here around reporting on your building performance, potential penalties for poor performance. How does that shape how you’re guiding your clients, how you’re working with your customers, and how that kind of adds into the mix here, with your solution and reporting?

Rimas: Yeah. I mean, first off, I think it’s extremely exciting and valuable that GRESB is moving in that direction. I think all the members are super excited. But I think on top of that you hit the nail on the head where there is a convergence. All these BPSs across North America and anywhere else in the world are really focused on performance.

And by GRESB aligning with this, it’s going to give an additional layer of perspective for all the building owners and portfolio owners and investors. Whereas BPSs and benchmarking policies are very focused on local jurisdictions, maybe state level, maybe, you know, cities and county level. GRESB gives an opportunity to raise that up at a global perspective as well. GRESB is going to add an additional layer that’s arguably more verified, more consistent on top of this. So we’re super excited. I think the alignment is extremely strong, where the industry is heading, where GRESB is heading. And I think it’s a huge step forward for the industry. So yeah, I couldn’t be more excited and at the end of the day, ENERGY STAR is going to make it even easier to report and align with GRESB’s performance targets as well.

Reid Morgan: Absolutely. Well, Rimas, thank you so much for joining us for this conversation. Loved your perspective, love what you’ve brought to the market, and seeing some really great synergies in this ability to centralize the effort and get the data right and get it into the right places.

So, this is exciting. If anybody is interested in learning more about this, you can reach out directly to Rimas. We can point you to him and his team. This has been really helpful and insightful. Thank you.

Rimas: Thanks, Reid, and thanks to GRESB for being a wonderful partner.