The following Viewpoint is written by Nathan Kegel, Senior Vice President of IES
When New York City’s 2025 Energy Conservation Code goes into effect on March 30, many project teams will see it as another tightening of efficiency thresholds. In reality, however, its most significant impact may be procedural rather than technical.
The updated code increases the value of performance modeling, accurate HVAC load calculations, and verification and commissioning, changing the way contractors, engineers and developers coordinate projects long before equipment is ordered or permits are submitted.
The new code increases the value of early stage performance modeling and an integrated HVAC
energy code compliance model and zing. Stricter envelope performance, air leakage testing, lighting controls and electrification requirements mean that more building elements must be assessed as integrated systems. And if these interactions are not assessed early, project teams may discover later in the design that systems are oversized, underperforming, or misaligned with compliance pathways.
For contractors and design teams this creates three immediate pressure points:
First, electrification strategies require prior coordination: As more projects pursue high-efficiency electrical heating and cooling systems, electrical capacity, distribution planning, and equipment sizing must align sooner. Modeling and understanding both peak loads and part load performance is no longer just a design optimization step, but can determine whether a project remains compliant without costly infrastructure changes. Focusing only on peak load size can miss important opportunities to both meet code and add life-cycle cost value to each project.
Second, the envelope performance is no longer theoretical: Expanding air-seal verification and performance expectations mean that value decisions cannot be designed in isolation. Building contractors must understand how overhead assemblies interact with HVAC sizing and ventilation strategies. Small changes in glazing ratios or infiltration assumptions can have downstream compliance implications.
Additionally, these requirements help ensure that equipment sizing can be based on better infiltration and thermal bridging assumptions than previously used in sizing HVAC systems. Because testing and verification is required, this reduces the risk that the actual construction will differ dramatically from what was intended in the design documents.
Third, not all energy code compliance paths offer the same value to the homeowner: Choosing a path to meet this from the outset is critical to budget success for both the overall construction budget and the design teams’ design budgets. There are many nuances and factors that go into determining which performance route is best for a given project, and having these conversations and agreements is paramount to meeting energy code requirements. While the prescriptive path may have the least amount of labor for the design team, it also (usually) has the least amount of value in terms of early-stage decision-making when considering options for envelope, HVAC system choice, internal gains, and more.
This is not to say that projects are becoming more complex for the sake of complexity, but it is that the margin for late adjustments is shrinking, as late changes or “value engineering” may cause the design to fall short of code requirements; exploring various options early on is the best way to avoid costly later work at the end of the process. And in a market already challenged by labor constraints and supply chain variability, rework driven by code misalignment is an avoidable cost.
The practical takeaway is simple: compliance modeling and coordination should begin in schematic design, not during construction documentation. When energy analytics is integrated early, teams can evaluate multiple pathways, test assumptions, and document compliance before procurement decisions lock in, only when using one of two performance pathways.
This shouldn’t be seen as a New York-only issue either; New York’s updated code reflects broader national trends. Energy performance standards everywhere are increasingly integrated with decarbonisation targets, grid resilience issues and overall building life cycle costs. The construction industry will increasingly be judged not only by delivering projects on time and on budget, but also by delivering buildings that perform to model.
For contractors and design teams operating in New York, the message is clear: treat the 2025 Energy Code not as a final hurdle, but as a framework for design and coordination. Those who adapt their workflows accordingly will reduce risk, protect schedules and position themselves competitively as performance expectations continue to rise.
Nathan Kegel is Senior Vice President of Integrated Environmental Solutions, where he works with engineering and construction teams to integrate building performance modeling into project delivery workflows. He advises contractors, developers and design firms on reducing compliance risk and improving energy performance outcomes on complex projects.
