The Mostly Real Estate Podcast, with Declan Spring

Updates To BESO - Berkeley's Building Energy Saving Ordinance - #69 Part 2 With Jeff Lipton

• Declan Spring

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Jeff Lipton and I discuss how the January 1, 2026, changes to its Building Energy Saving Ordinance (BESO) are about to reshape how Berkeley homes change hands, and we wanted to make the path clear. We break down the upcoming changes, and explain exactly what sellers must do, what buyers can expect, and why smart planning can turn a compliance task into a market advantage.

First, we clarify what a Home Energy Report and HER score actually measure, how the score becomes part of the MLS remarks, and why that visibility matters for buyers. Then we map the new fork in the road: complete qualifying upgrades before listing, or defer them and send a combined $5,000 deposit to the City that the buyer can reclaim after earning six credits within two years. We detail how the credit system works, the $150 compliance filing, and practical timelines, plus the very real tradeoffs between doing the work now versus passing it forward.

From there, we get tactical. We share vendor recommendations for heat pumps, solar, and electrification projects; outline common electrical needs like adding 240-volt circuits; and point to rebate aggregators to stack local, state, and federal incentives. We talk through heat pump water heaters, mini splits, induction ranges, and even battery-backed cooktops that keep working during outages. Along the way, we highlight a simple strategy: plan upgrades before equipment fails, pre-wire where possible, and use BESO compliance as a selling point that reduces buyer friction and can boost demand.

If you work in Berkeley real estate or plan to buy or sell, this guide will help you navigate HER scores, credits, deposits, disclosures, and the new expectations at the point of sale. Subscribe, share this with a neighbor or client who needs to prepare, and leave a quick review to tell us which upgrade you’d tackle first.

 Jeff Lipton is a licensed CA REALTOR® DRE#02139138, real estate strategist, operator, marketing expert, and business lead supporting his wife, Megan Micco, a top-producing broker associate with Compass, in Berkeley, CA

Declan Spring is a licensed CA REALTOR® DRE#01398898

Mentioned in the Show:

Berkeley Emissions Saving Ordinance (BESO)

The SwitchIsOn.org

ElectrifyMyHome.com

Albion (Solar)

Hassler Heating

Copper - An Induction Range Made in Berkeley

Declan:

This is Declan Spring, and welcome to the Mostly Real Estate Podcast. I'm calling this episode 69, part two, because this short podcast is just an isolated segment from my most recent full-length podcast released December 18th with Jeff Lipton. Now the bulk of that conversation was about marketing and lead generation, which Jeff Lipton is extremely good at, along with his wife Megan Miko at MeganMico.com. We concluded the conversation with a practical walkthrough of upcoming changes coming January 1st, 2026, to the Berkeley Energy Saving Ordinance, City of Berkeley point of sale ordinance, more commonly known as BISO. And it seemed sensible to me to isolate that part of our conversation here today to make for a short and easy listen about this specific topic. So I hope it's useful. Please hit the like button. Wherever you listen to your podcast, please share this podcast with anyone you know who might find it useful. And I would be delighted if you'd consider subscribing. Okay. Here is all about Biso and upcoming changes with Jeff Lipton. I I do want to just touch on um Beso or Biso, however anybody wants, because you and I were talking about it earlier. So we're just a few weeks away from uh this Berkeley energy, this this uh this change. I want to just go through it very, very quickly. What is what's happening?

Jeff:

Okay, so let's just start at the top. Um BSO or BESO, BESO is the building energy savings ordinance uh that was established by the city of Berkeley about 15 years ago, I believe. Initially, um there was a point of sale requirement to have an energy assessment done, which costs three to five hundred dollars. You have uh an engineer come to your home, they look around and they try to determine how energy efficient uh your home is. They look for things like windows and insulation, um, electrification, there's a variety of things they look at. Right. And then out of that you get a home energy report, an HER, a HER, and on the HER is a score or the home energy score, uh, and that's a zero to ten scale. And the higher the point total, the more energy efficient your home is.

Declan:

I just want to point out if anybody ever walks past some gentleman in Berkeley and they're talking saying her score is 10, they're not being misogynistic, okay? This is this is a real Berkeley thing. So sorry, go ahead.

Jeff:

That's a good point. Uh so and then they in the context of getting the home energy report, there would be a series of recommendations on things the homeowner could do to improve their score. Right. Add insulation, put ceiling around your windows, uh, you know, put solar on the building. There's a whole series of things you can do to increase your efficiency. Yeah. Um, prior to January 1st of 2026, uh there were two options for a homeowner that's selling their house. The first option was to go hire the energy assessor and get the report, and then you pay a filing fee with the city. Uh, the energy assessor would submit the report to the city, and then you would be in compliance. The second option, which many home sellers have chosen to do in the past, is to defer that to the to the buyer. Right. Uh so there was a fee of I think it was about$85. So you filed a form and you pass it along, and then the buyer had, I believe, six months to go get the report, then they could see what their score was along with the recommendations.

unknown:

Right.

Jeff:

So at the time it was really just educational for homeowners in terms of how efficient their home was and things they could do to improve it.

Declan:

No action required.

Jeff:

No action required other than to get the report and pay a filing fee with the city.

Declan:

And then the city would have the score publicly available for the Trevor Burrus. That's right.

Jeff:

And there's a there's a uh portal, a BISO portal. If you go to the city of Berkeley, you can find it and you can look up the address of any property and it will tell you if they're in compliance or not. If they are, you can look at their score. The the city determined, the city council determined, that they really wanted to do more to meet their long-term climate goals, which were published in, I want to say, 2009. Right. So there's been a specific effort to reduce carbon emissions in the city. Yeah. And the BISO project was simply educating people about things they could do, not actually forcing them to do it in any manner. The city council decided they need to put uh a little more meat in on the bone of the project, of the program. So starting in January, it will now be a point of sale requirement that the seller go get the energy report. You cannot defer getting the report to the buyer. You have to do it. So you have to pay the three to five hundred dollars, get an energy assessor to your house, and get your report, your her.

Declan:

And the energy assessors, they're on the Berkeley website.

Jeff:

The others ten or twelve that you can choose from that have been vetted by the city, that are certified. Um, it's a simple process. They come and spend an hour or two at your house walking around, looking at things, and they write up the report.

Declan:

Okay, so no more deferral. You gotta do it if you're selling a house and you gotta do it.

Jeff:

You gotta do it.

Declan:

Okay.

Jeff:

And as a listing agent, uh, you need to include that report in the disclosures. Yeah. And you have to post the score in the MLS record in the public remarks. Okay. Home energy report, score of six, whatever it happens to be. Okay. So the buyers know what the condition of the property is from an efficiency standpoint.

Declan:

Oh my gosh. So in the public remarks, so that's eating up valuable marketing text real estate in our public remarks.

Jeff:

You could probably do it in 10 or 15 characters. It's just a little bit. You could just do H E R equals six. I don't know. We we'll find ways of keeping it tight. All right. So that's the first step is as a seller, you have to get the report done. Yeah. Then you have two options after that point. You you have to either defer any upgrades to the home to the buyer. And if you choose to defer the upgrades, the seller has to provide a$2,500 deposit to escrow.

Declan:

Yes.

Jeff:

The buyer also provides a$2,500 deposit to escrow for a total of$5,000. Okay. And the title company will then complete a deposit form and deliver the$5,000 and the form to the city of Berkeley. I see. At that point, the escrow closes, the buyer then has two years to bring their home into efficiency compliance.

Declan:

Okay.

Jeff:

They have a number of measures, there's 10 or 12 that you can implement in your home. Yeah. Each of those measures has a number of credits that's associated with it. Okay. You need to get to six total credits to be in compliance. Got it. Some things like adding insulation to your floor is worth two credits. Right. Some things like installing a heat pump water heater is worth the entire six credits. Got it. So depending on what your score is, what measures have been implemented in your home, you have to determine what else you want to do in order to get to that six credit threshold. Right. Once you've completed the work to get to the six credits, you then file a deposit return form with the city of Berkeley and they give you your$5,000 back to the buyer. Yeah. The new homeowner at this point. Right. Effectively, that means that as a seller, if you defer the work to the buyer, you are giving the buyer a$2,500 credit.

Declan:

Right. And I was telling you I got barked at by somebody for saying, isn't that kind of like my real estate minds, you know, informed me that this is like a mandatory seller credit to a buyer, only if the buyer chooses to do the work and get the money back. Otherwise, who keeps the money after two years if the buyer doesn't do the work? The city of Berkeley keeps the money. So it's an interesting thing, isn't it? Um okay, so there's a buffet that buyers that sellers can choose from, and they can be compliant up to they get the six points or six credits.

Jeff:

Yep. There is there is also a$150 fee uh that you file that you pay for when you file the compliance report. So once you're done with the measures, you have to pay another$150 to the city to submit the report and then they'll approve it.

Declan:

Okay.

Jeff:

And then if you go to the VISA website, you'll see that it is in compliance. A couple other things to note. A small one is while the buyer has two years to complete the work, if it's been deferred, there is the option to extend that for an additional year for a total of three years. Um hopefully people won't need three years to do this. Right.

Declan:

Um it's not clear.

Jeff:

They have not worked out all the details yet. So this does not go into effect until January 1st, and the city is still working out some of the fine print. Right. From my perspective, we are going to be advising our sellers to uh implement the measures to become certified. And there's a few reasons for that. Okay. Number one, it's the right thing to do.

Declan:

Yes.

Jeff:

You want your home to be more efficient, you want it to be using less carbon, you want it to be using less natural gas for health reasons. No doubt. So it's a good thing to do. Yeah. Um, number two, you're not having to give a$2,500 credit to the buyer for no reason, essentially. Number three, it's likely to increase the demand for your property when buyers know they don't have to do any work after purchasing it to become compliant.

Declan:

Yeah.

Jeff:

So we believe that's going to be a marketing benefit to say we've already become Biso compliant. Right. And there still are a number of rebates available for a heat pump water heater. Okay. Um, there potentially can be electrical work that's needed to be done to wire a higher capacity circuit for those appliances. Depends on your house and the situation and your electrical.

Declan:

Yep.

Jeff:

But there are heat pump water heaters now that are as inexpensive as, you know,$1,800 to$2,000 for four rebates. So in many cases, it may be more cost effective to implement the measures to become compliant than it will be to pay the deposit.

Declan:

Yeah. I like that. I like that. It'll be interesting to see what it does in the market in terms of buyer demand for properties that are compliant versus not. We're all kind of, I guess, itching to look at the data this time next year and see what happened with all of this, what happened at our open houses, what the chatter was at the open houses and all that stuff. That's going to be fun. But absolutely, I'm fully aligned with your thinking that this is just this is just a good thing to do anyway. Um I know that uh Megan and yourself are just are both very interested in in people making their homes greener and electrifying their homes. And do you have any uh vendors or recommendations on anything at all? We'll need to make relationships in the industry now so that our clients know where to turn when they need vendors. So go ahead and tell us some of yours.

Jeff:

Well, let me make two comments before that. So, as I had said earlier in the conversation, I spent nearly a decade in energy resource management and elect in electricity and water. So I have a personal passion for this stuff. Nice. I care uh a lot about the environment. I think that there's things we can do that are practical and cost effective to reduce our resource use, yeah, uh, become more efficient. And both Megan and I are certified green realtors as well. Nice. So we do bring expertise in our business and our practice to help people understand the benefits and costs and challenges of electrifying their homes. Yeah. We have personally electrified our home. Right. Uh with we've done all of it essentially solar, induction range, heat pump water heater, heat pump furnace, heat pump dryer. We've done all the stuff, higher electrification. Um, so we're big advocates of this stuff. Um so all that being said, uh, there's a lot of vendors out there, and we've worked with some of them. We used Electrify My Home as a vendor for our recent heat pump project where we replaced our old gas furnace and installed some mini splits as well. Yeah, quite the project.

Declan:

Yeah.

Jeff:

Um, we work with Albion Power for solar. How do you spell that one? A-L-B-I-O-N. Okay. Had a great experience. Um Hassler is a local HVAC company that installed our heat pump water heater abruptly when our eight-year-old water heater broke and flooded our uh basement. Oh, wow. Suddenly.

Declan:

Oh wow. Thank God it was just in a basement. But hopefully it was like an unfinished part of the house.

Jeff:

Relatively unfinished. It wasn't a huge problem. The bigger issue was is that they said they could install a gas uh water heater replacement in 24 hours, but to get the heat pump water heater and go through the permitting process took nearly a week. Oh, I see. Yeah, that's a good thing. And was more expensive. So we had to suck up having no hot water for six days. What time of the year was this? It was in February of last year. That was good, yeah. No, it was it was a pain. And fortunately, we fortunately we'd done some work earlier to run a 240-volt circuit to the location of the water heater, knowing we wanted to uh update it to a heat pump in the future.

Declan:

Yes.

Jeff:

So we did not have to do any electrical work. And this is a big part of electrifying your home is planning ahead. You don't want to wait until your water heater floods your basement and then be in a position where you're without hot water. If you can do it at an off-peak time when it's warm outside, and you can get your permits ahead of time so you're not waiting, then it it can it can go a lot smoother. So there are lessons to be learned. I'm happy to talk to anyone about the details of these processes if they're interested in learning more.

Declan:

That's very cool. And I think electrifymyhome is electrifymyhome.com. I'm pretty sure. I'll put a link in the show notes and I'll make sure it's working.

Jeff:

The the one other resource I encourage people to check out is it's called theswitchison.org. Okay. And it's an aggregation of all the available rebates, both local, state, and federal, yes, for a whole range of different efficiency measures, heat pumps, water heaters, solar, battery systems. So uh we also have a home electrification resources page on our website that people can check out.

Declan:

Nice. And of course, we're just about a year away from people not being able within nine counties to get uh a gas-fired water, you know, water heater, too. So furnace, right? Or furnace, so that's gonna dovetail there. And you told me about uh a local Berkeley company making stoves, electric stoves, a Cooper Copper, Copper, Copper is making stoves. I'm gonna look into it.

Jeff:

So induction stoves, they're beautiful, wood paneling, they're they're they're wonderful devices. They have a built-in battery.

Declan:

Yeah.

Jeff:

So if your power goes out for any reason, you can still run your electric stove for some number of hours. I'm not sure how long. Sure. So it's it's a great product. I have some friends who recently purchased it. Um we got our induction before they were commercially available.

Declan:

So you said, and I I won't quote, well, I mean, I won't hold you to it, but you think they might operate off of 110.

Jeff:

Yes, I believe that's true. Yeah, I mean, at least they have a model that does. Typically the challenges with 110 is there's lower amperage that goes to that appliance, so they take longer to heat up. And that's true for water heaters and heat pumps and induction ranges as well. So you don't have to do special electrical, but you do typically need at least a 30-amp circuit, even if it's 110 to that location. And many homes don't aren't wired that way. So you always want to consult with an electrician before you start considering electrification updates.

Declan:

Definitely. Jeff, it's been an absolute pleasure to finally sit down with you. I think you're, I think you're great. I love the Meg and Miko team, the brand, the whole bit. Learn a lot. Learned a lot from this. This was this was just fantastic. So I wish you a very nice uh December holiday season, a happy new year. Jeff, thank you very much.

Jeff:

Thank you so much for your time, Declan. I really enjoyed it.

Declan:

Thanks for listening to the show. Thanks for listening all year. Here are the credits. It takes a bit to put a show like this together. Mostly it's edited by me. In fact, it's always edited by me. Original music is from Chuck Lindo, my good friend Chuck. Happy holidays, Chuck, and graphics by Lisa Mazer. Lisa is right here in Berkeley, LisaMazer.com. She's a fabulous graphic designer. The podcast is brought to you by the Home Factor Realtors, thehomefactor.com. Catch up on the latest news from the East Bay market in their weekly Substack, published every Sunday. Go to thehomefactor.com to subscribe. If you'd like to reach out to me, and I sure would love if you did, with suggestions for the show, especially for 2026, that kind of thing, please text me at 415 446 8591. Catch you on the next podcast, everybody.