(a) For purposes of this section, the following definitions apply:

(1) “Benchmarking data” means data delivered to the commission pursuant to Section 25402.10.

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(2) “Covered building” means any building subject to the benchmarking regulations adopted pursuant to Section 25402.10.

(3) “Fuel-related emissions of greenhouse gases” means emissions of greenhouse gases from the onsite usage of fuels or emissions of greenhouse gases from the offsite production of steam or other forms of thermal energy, or from locally generated electricity, as part of a district energy system, but excludes emissions of greenhouse gases associated with electricity from the electrical grid that is used by a covered building.

(4) “Harassment” means an act that is unlawful pursuant to subdivision (a) of § 1940.2 of the Civil Code, a misrepresentation made to a tenant that the tenant is required to vacate a rented area, or any other act defined as harassment by an applicable city, county, or city and county ordinance.

(5) “Under-resourced community” has the same meaning as defined in Section 71130.

(b) On or before July 1, 2026, the commission, in consultation with the State Air Resources Board, Public Utilities Commission, and Department of Housing and Community Development, shall develop a strategy for using benchmarking data to track and manage the energy usage and emissions of greenhouse gases of covered buildings in order to achieve the state’s goals, targets, and standards related to energy usage and emissions of greenhouse gases of covered buildings, including both of the following targets:

(1) The annual targets for statewide energy efficiency savings and demand reduction established pursuant to subdivision (c) of Section 25310.

(2) The greenhouse gas emission reductions targets for the building sector established by the State Air Resources Board as part of achieving the economywide greenhouse gas emissions reductions required pursuant to the California Global Warming Solutions Act of 2006 (Division 25.5 (commencing with Section 38500) of the Health and Safety Code).

(c) In developing the strategy pursuant to subdivision (b), the commission shall do all of the following:

(1) Avoid increasing utility and rental cost burdens for, or causing evictions, harassment, or displacement of, tenants of covered buildings. For purposes of this paragraph, the commission shall consider including the following requirements as part of the strategy:

(A) Requirements to prohibit a renovation to a covered building that is required by the strategy from being a basis for terminating a tenancy and to ensure that any temporary relocation costs resulting from the renovation is paid for by the covered building owner.

(B) Requirements to prohibit an increase in rent for a tenant as a result of a renovation to a covered building that is required by the strategy or to limit the increase in rent to the long-term energy savings to a tenant resulting from the renovation.

(2) Assess the feasibility and cost-effectiveness of building upgrades available to covered building owners for achieving increased energy efficiency and reductions of the emissions of greenhouse gases.

(3) Provide flexibility, to the extent feasible, for covered building owners to select among technology options and to align the timing of building upgrades with equipment replacement cycles.

(4) Encourage equitable access to jobs and other economic opportunities that may result from increased investment in covered building upgrades.

(5) Prioritize reductions in fuel-related emissions of greenhouse gases because the state has already established targets, pursuant to § 454.53 of the Public Utilities Code, for reducing, and ultimately eliminating, indirect emissions of greenhouse gases associated with electricity.

(6) Prioritize efficiency and decarbonization measures that will benefit tenants, including measures that reduce tenants’ energy costs and remove indoor environmental hazards.

(7) Consider including a process by which a covered building owner can propose, and the commission, or a local city or county building department to which the commission delegates this authority, may approve or reject, an alternative compliance plan. An alternative compliance plan shall, consistent with paragraph (1), avoid increasing utility and rental cost burdens for, or causing evictions, harassment, or displacement of, tenants.

(8) Consider authorizing a local jurisdiction to implement its own program for increasing energy efficiency and reducing the emissions of greenhouse gases as an alternative to the strategy developed pursuant to subdivision (b) if that program is expected to achieve substantially equivalent or better increases in energy efficiency and reductions of the emissions of greenhouse gases, and if that program guarantees substantially equivalent or stronger tenant protections.

(d) In developing the strategy pursuant to subdivision (b), the commission shall consider input from affected stakeholders, including all of the following:

(1) Members of under-resourced communities and community-based organizations representing tenant advocacy, equity, and environmental justice concerns of under-resourced communities.

(2) Representatives of local city or county government.

(3) Owners or operators of affordable housing.

(4) Groups representing low-income residential and small commercial tenants, including organizations that provide legal services to those tenants.

(5) Providers of energy efficiency, renewable energy, and building decarbonization equipment and services.

(6) Labor unions that represent workers who implement building upgrades related to, or who manage or service, the energy infrastructure of covered buildings.

(7) Technical building design professionals.

(8) Facility operations professionals.

(9) Multiunit residential building owners.

(10) Nonresidential building owners.

(11) Energy utilities.

(e) In order to ensure equitable participation and input from stakeholders representing under-resourced communities, low-income residential tenants, and small commercial tenants in the development of the strategy pursuant to subdivision (b), the commission shall do all of the following:

(1) Contract with one or more organizations with experience representing under-resourced communities, low-income residential tenants, and small commercial tenants to advise the commission on the development of the strategy.

(2) Consider the feedback and recommendations from each advisory organization contracted with pursuant to paragraph (1) on the proposed strategy in advance of adopting any final strategy and, to the extent that any recommendations are not adopted in the final strategy, provide a written explanation of why the recommendations were not adopted and how the final strategy attempts to address the issues raised in those recommendations in an alternative way.

(3) In consultation with the advisory organizations contracted with pursuant to paragraph (1) and other stakeholders, develop metrics that could be used if the strategy is implemented to measure how the strategy is impacting under-resourced communities, low-income residential tenants, and small commercial tenants, and assess whether the strategy is achieving just and equitable outcomes.

(f) (1) On or before August 1, 2026, the commission shall submit to the Legislature the strategy developed pursuant to subdivision (b) and recommendations for further legislative action that would help achieve the objectives described in subdivision (c) if the strategy is implemented.

(2) The commission may submit the strategy and recommendations to the Legislature as part of a report otherwise submitted to the Legislature.

(Added by Stats. 2023, Ch. 378, Sec. 3. (SB 48) Effective January 1, 2024.)