“Energy Efficiency:”
Do You Really Mean It?

The debate over global warming continues. But while scientists and pundits go back and forth about proposals like cap-and-trade, fundamental issues on energy conservation and sustainability get less attention—even though they may have more real, near-term impact.

According to IBM’s Smarter Buildings Survey, 70% of all electricity in the US is consumed by buildings. Fifty percent of that is wasted—the same goes for water. Current estimates suggest that by 2025, buildings will be the single largest consumers of energy on the planet. Not to mention greenhouse gas emissions.

In truth, ‘bolt-ons,’ and similar approaches, are more cosmetic than impactful.

You don’t have to look far to find real examples of this. Take the regional headquarters of a large tech company with several hundred thousand square feet of rental space. Almost nothing about this project was designed to conserve energy except for a few “bolt-ons” that have little real effect on overall efficiency. The building has walls of untreated glass, little or no passive solar, and uncoordinated HVAC. Ironically, it’s a cutting-edge tech company with an obsolete building.

In truth, “bolt-ons,” and similar approaches, are more cosmetic than impactful, and they typically can’t meet the higher standards some tenants now demand. As more companies try to reduce their carbon footprint—for cost and in the hope of being seen as “green”—those taking a “cosmetic” approach may find it hard to get tenants. The result is a loss of market value. As we are already seeing, many high profile tenants often refuse to consider a property that doesn’t meet certain standards, or they feel empowered to demand energy efficient adjustments.

‘There is social and market pressure to be a good citizen, but any move must also make economic sense.’

Bob Lemons, Managing Partner of KeyPoint Partners, a company that manages and leases commercial real estate, has driven this point home by saying, “There is social and market pressure to be a good citizen, but any move must also make economic sense.”

Why is it so difficult to measure real energy, and energy investment, efficiency? Part of the problem is that technology changes so quickly. Few architects or engineers can keep up with the tools available for energy-efficient new construction or retrofitting projects, never mind being equipped to project the financial impact of low energy strategies. Government agencies such as the EPA or DOE offer some guidance, but there are no standards aside from quick and obvious fixes like sensors that turn lights out in office buildings. “Deep retrofits,” such as re-insulating the envelope of the building, aren’t practical unless buildings can be taken apart for other reasons.

The industry is gearing up for more change and the possibility of stronger and more coherent government regulation.

ECON offers one solution. We’ve developed an “energy investment system” both for existing buildings and for those in design. By crunching an incredibly large amount of data we can produce a set of optimized energy performance and financial results, taking into account every feasible low-energy mix of technologies—for everything from insulation to HVAC to windows—and how they can best be implemented as part of a building energy strategy.

As the industry gears up for more change, and the possibility of stronger and more coherent government regulation, this economics-driven solution could become the foundation of a meaningful energy efficient future for commercial buildings.

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