On December 14, 2021, the New York City Council passed legislation that effectively bans the use of natural gas in new buildings. Mayor de Blasio is expected to sign the legislation.

Over 70 percent of New York City's greenhouse gas emissions come from buildings. Most of those emissions come from larger commercial and residential buildings. New York City has previously enacted measures designed to limit greenhouse gas emissions but the new bill is the city's first effort to make the use of natural gas unviable for new construction.

The legislation effectively bans the use of natural gas in new buildings that are:

The legislation also provides limited exceptions and various effective dates for uses such as affordable housing, manufacturing, sewage treatment, laboratories, laundromats, hospitals, schools, crematoria, commercial kitchens, utility power generation, and for emergency or standby power facilities.

While the legislation does not specifically ban natural gas, it achieves the same result by establishing building emissions limits that can only be met through the use of electricity but would be exceeded by the use of natural gas.

In addition, the legislation requires the Mayor's Office of Long-Term Planning and Sustainability to conduct:

While other municipalities have imposed limits on greenhouse gas emissions, the adoption of the ban by America's largest city will likely have significant ripple effects far beyond the Hudson River. If New York City can aggressively pursue the reduction of greenhouse gas emissions, then other cities may be pressured to follow suit.

New York City has leaped to the forefront in the battle against climate change and its future efforts will no doubt be watched nationwide.

For property owners, investors, and developers, any doubts about the government's determination to fight climate change must now be firmly put to rest. The commercial real estate industry should anticipate a future in which long-term planning is more difficult and unpredictable than ever before.