Energy conservation is the most abundant and least expensive form of energy supply available. Proven energy conservation measures provide cost-effective means to reduce a building’s energy consumption by 5 to 50 percent and still provide an attractive return on investment (ROI) and positive net present value (NPV). Energy conservation measures can also make buildings more valuable. When a building produces higher bottom line profits and ROI for its owner, it also enjoys asset appreciation due to better business cash flows.
But that doesn’t mean that all ideas to save energy are good ones. There is a business risk involved in jumping at the first proposal to reduce energy costs, particularly when that proposal comes from a vendor or contractor with a vested interest in selling a specific type of product. The only way to determine the most profitable path to energy efficiency is to conduct a careful analysis of opportunities and gains. To do that, facility executives should analyze a building’s energy efficiency options and the ROIs for each. If there isn’t the right level of expertise in house, it’s worth considering an independent energy consultant, one without any connection to a product or service. One good source for independent energy advice is a Certified Energy Manager or CEM.
Here’s what to consider.
The first step is an objective review of utility billing history including consumption and costs. This step looks at the building with the eyes of a CFO plus an understanding of the building’s operating requirements. Take a close look at the building’s hours of operation, mechanical, electrical and plumbing systems, and existing control measures to better understand why and where the building uses energy. The idea is to identify energy costs for HVAC, motors, lighting, plug load (equipment that is plugged in, such as computers, printers, copiers, etc.), natural gas and water use. Having 12 to 36 months of data shows trends in the utility monthly energy consumption from winter to summer.
The hard way is to gather this data from paid utility bills. The easy way is to get the information from each utility vendor.
Next, facility executives should benchmark the building with others of similar size and type in the same geographic region. Company records, the free, online ENERGY STAR Portfolio Manager tool, the Information Exchange from the Building Owners and Managers Association (BOMA) International, and other databases can be helpful. The ENERGY STARENERGY STAR model converts all energy types (electricity, natural gas, oil, district chilled water, district steam and any other fuel) to BTUs and then uses the metric BTUs per square foot. This takes utility rates and costs out of the picture and provides a better apples-to-apples comparison.
Benchmarking buildings by BTUs per square foot also helps set priorities within a portfolio of buildings. An independent energy consultant and an internal energy champion can work together to create a meaningful picture of the building’s energy consumption.
Benchmark Energy Data
Check The Payback: Life-Cycle Cost Analysis
