June 2013
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Six Steps to Portfolio-wide Energy Reduction

Technical insights, observations, lessons learned and just good solid information about energy consumption and cost reduction in commercial, industrial and municipal buildings.

Jim FowlerJim Fowler,
PE, CBCP, CEA
Global Energy Audits

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Control Solutions, Inc

Six Steps to Portfolio-wide Energy Reduction
Do you have 5, 15 or 50 buildings?  Amidst your day to day responsibilities, it’s an overwhelming task to reduce energy consumption across that many buildings.  Whether you’re a municipality, a property manager, a big box store owner or Kentucky Fried Chicken, here are the 6 steps you need to take.

1.    Benchmark your buildings and create a Portfolio Energy Summary:  These days, Benchmarking is usually thought of in terms of EPA’s  Portfolio ManagerThis is recommended, but it’s not enough.  Go ahead and create an account, enter your building data and receive an Energy Star Score.  You can use this score to see how you compare to similar use buildings. 

Now here’s the important part.  Create a Portfolio Energy Summary.  List your building inventory in a spreadsheet, include square footage, the last two years of energy costs and the amount of energy used, typically converted to BTU’s.  Create two more columns and divide the energy costs and energy use by the building square footage – these columns are your energy cost index (ECI) and your energy use index (EUI) for each building.  Then calculate what we call an “E-Factor” and put in a new column. 

If you prioritize your buildings by the amount of energy spend you don’t consider their efficiency or inefficiency.  Alternatively, if you prioritize by efficiency, you miss the cost factor – a terribly inefficient building would not be near the top of your list if your annual energy spend for that building is insignificant.  So, we’ve created what we call an “E-Factor”.

To calculate each building’s E-factor, multiply your average annual cost by the building’s EUI and divide by 100,000 to get usable numbers.  Sort the E-Factor column from highest to lowest. 

You now have an inventory list that considers the building’s efficiency AND gives you an idea of the magnitude of savings possible.

Benchmark

There may be some anomalies in the list, and each building should be considered more deeply from maintenance, political and other viewpoints, but in general, this is the master Portfolio Energy Summary you’re going to working from to implement an energy reduction program.

2.    Monitor your buildings:  Energy Monitoring serves the same purpose for your building operations as your Income Statements and Balance sheet do for your business operations.  “If you don’t measure it, you can’t manage it.”  There is a very wide range of energy monitoring systems available, ranging from free to very expensive.  We typically recommend using the Noesis platform which is free, and then automate the future addition of monthly consumption and cost data by adding their Data Services at a cost of $10/meter for set-up, plus $5/meter/month to download data directly from your utility provider each month.

Whatever system you use, you will need trending, comparison and reporting capabilities and it should be internet or intra-net based so other stakeholders can also access this information.

Monitoring will give you an ongoing report of consumption, but as importantly, you can use the annual figures to update your Portfolio Energy Summary and re-prioritize your energy efficiency plan. 

3.    Audit worst performing buildings with the highest potential savings:  In consultation with an energy auditor, choose 3-5 buildings and perform a comprehensive energy audit on each.  The auditor’s insight and experience should impact the buildings chosen.  For example, if there are four similar-use buildings with similar HVAC systems, only one may need to be audited to learn about all four.   The auditor should create an “EEM matrix” containing the audited buildings and the recommended energy efficiency measures (EEM’s).  This EEM matrix should help determine which recommendations should be implemented and in what order.  For example, if the shortest payback or highest ROI EEM’s consistently turn out to be lighting upgrades, this suggests a lighting upgrade program across all buildings should be implemented first and the savings used to fund future EEM’s.

4.    Using the EEM matrix, maintenance plans and funding parameters, select which EEM’s to implement in what order:  The results of this step should be folded into operating and capital plans and budgets.  As part of an investment grade audit, EEM costs are estimated by the auditor, as are payback and ROI’s for each EEM.  The costs should be updated annually by contractors to assure accuracy for future budgeting.

Summary

5.    Every 3-4 years, audit the next group of buildings on the Portfolio Energy Summary:  Using the annual data generated from Monitoring and the continually updated Portfolio Energy Summary, continue to work your way down the Summary list by auditing successive groups of buildings. 

Control Solutions, Inc 6.    Measurement and Verification (M&V):  As much as possible, the resulting savings from EEM’s that are implemented should be tracked.  Costs are known and savings should be monitored via your building’s energy monitoring system (EMS) or on your Noesis platform.  Building usage and occupancy changes, so larger or smaller than expected savings may be a result of a change in one of these parameters, an over or under-estimation by the auditor, or incorrectly implemented EEM’s by a contractor.

Your energy efficiency program should be a living plan, meaning that it should be reviewed and adjusted at least annually to accommodate the inevitable changes in operating conditions, ownership, energy costs and occupancy that a building typically experiences over its life.

Global Energy Audits is an energy engineering consulting firm focused on reducing energy costs and consumption for owners and operators of commercial, industrial and municipal buildings through  energy assessments and retro-commissioning.  The firm also helps portfolio owners integrate energy considerations into their facility, capital and maintenance plans.  Jim Fowler is the founder and Principal.


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