The city of New York ran into the same problem as many other building owners when it comes to energy efficiency. The tenants in the buildings don’t directly pay their utility bills, so it was hard to get them interested in saving energy, especially if it meant capital-intensive retrofits.
“Why would an agency invest its own money if we pay the bill?” asked Ariella Maron, deputy commissioner for energy management at the NYC Department of Citywide Administrative Services, the department that pays the city’s energy bills.
To combat the problem, the city decided to put agencies on the hook for their energy budgets across about 4,000 buildings. If they came in under budget, they got to pocket the difference, but if they were over budget, they had to pay up. In the first three months, administrative services paid out $900,000 but collected $1.5 million. “For the first time, [agencies] cared what the energy mangers wanted,” Maron said during a panel discussion hosted by Clean Energy Connections, "Intelligent Infrastructure: Designing Smart Buildings for NYC."
In the commercial space, green lease language is also bringing energy to the forefront, according to Constantine Kontokosta, Director of the Center for the Sustainable Built Environment and Clinical Associate Professor at NYU's Schack Institute. Although the discussion was about intelligent infrastructure, the conversation was more focused on how data from buildings will allow the business of efficiency to scale up.
“As lenders get more info about how buildings perform before and after retrofits, [...] traditional lenders will be more comfortable with how to relate to them,” said Kontokosta.
The conversation was less about technology than capital markets and policy. But the former will drive the latter, especially with benchmarking data becoming available.
But just having reams of data is not enough. Kontokosta noted that his center was doing some validity testing on the benchmarking data for New York City buildings to understand what controls need to be accounted for. Also, he said about twenty third-party consultants did the benchmarking for 80 percent of buildings, so any differences in how they calculated the metrics can skew the data.
Even though the data may be incomplete or slightly flawed, heads are already turning -- at least at the city level. “We do know that people are starting to read the information and read their utility info in a way they never did before.” said Moran. “We’re even seeing a few agencies move forward on a campus-style building management system.”
Step one is just getting building managers and occupants to pay attention, and that’s happening. Kontokosta equated the benchmarking with the law in New York that chain restaurants have to post calorie counts on menus. Although there is mixed data on how much it changes ordering behavior, it has meant that some restaurants have tweaked their highest calorie offerings to be healthier.
The same will hopefully happen in the real estate market. “All of a sudden, buildings will have to respond to questions about why their EUI [energy use intensity] is so high,” said Kontokosta. “The power of data is there if we can effectively communicate it.”