PlaNYC: Energy Aligned Clause

Traditionally Landlords have been offered little incentive undertake energy retrofits; they provide the capital expenses and the tenant gets the financial benefit of reduced operational costs. Green clauses allow landlords to recoup the capital expenses through the savings the tenant made on operational costs but haven't seen experienced great success due to the slow return they offer.

This report details the PLaNYC solution to the split incentive problem: the Energy Aligned Clause. It offers a workable compromise that allows savings to be felt by both landlord and tenant.

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landlord/tenant, split incentives, green leases

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