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Program Notes & Transcript

In the February Briefing, we talked about new rules that compel owners of large buildings to record their energy use through a process called benchmarking. They require owners to use a tool provided by the U.S. Environmental Protection Agency, called Portfolio Manager. You enter the preceding 12 months of energy consumption to calculate a score for each building.

The laws go on to require disclosure of those energy scores whenever a building is sold, leased, or refinanced.

New York City and the District of Columbia go even farther, publishing the scores through a public database for anyone to see -- including insurance companies, employees, customers and investors.

That might sound harsh, but consider the European Energy Performance Directive on Buildings, which calls for labeling buildings according to their energy efficiency.

But the U.S. is always 10 years behind Europe, so labeling is a long way off, here, right? Don't relax too fast. Some major cities are moving in that direction now, and the American Clean Energy and Security Act contains language about labeling new homes and commercial buildings.

And let's not forget that Energy Star is effectively a label that designates buildings in the upper echelon of energy efficiency. Energy Star is voluntary in most cases, but owners still pursue it because it's been shown to improve the asset value of a building and fetch higher rents.

That raises the question of whether voluntary programs wouldn't be more effective than mandates in the first place. Benchmarking is a requirement of Energy Star for buildings. And Energy Star is a requirement to get a building certified under the US Green Building Council's standard for Leadership In Energy and Environmental Design, or LEED.

That means those buildings are among the most efficient in the country -- at the time they're certified. Or maybe earlier, if the building's efficiency rating is simulated using energy modeling software instead of actual consumption. Modeling has gotten fairly accurate, but it's not perfect.

Even if a building is simply built to code, with the minimum legal level of energy efficiency, and performs just like its model on the day it opens, it can drift below its intended performance levels.

Systems get out of tune or outright fail. Sometimes it's that the operators aren't completely up to speed on how to run a sophisticated building. But often it's blamed on occupant behavior -- a tough thing to predict, especially with software.

It's a complex set of issues, but it's critical if cities, states, and companies are going to meet their goals for cutting carbon emissions.

Part 1 - Energy:Minute -- Continuous Commissioning

For the next half hour, we'll be talking about various kinds of energy monitoring, so let's start by spending one minute on one of the relatively recent methods, continuous commissioning:

» Transcript

Part 2 - Interview with Phil Bomrad, Director, Siemens

Here to talk more about the future of these regulations is Phil Bomrad, Director of Energy Services for the Building Technologies Division of Siemens Industry. Building Technologies is an 8 billion dollar business unit of Siemens, and Phil runs the energy efficiency programs there, including monitoring-based commissioning and demand response.

Denis Du Bois:
Phil, thanks for taking time to join us.

Phil Bomrad, Siemens:
Glad to be here.

Denis:
Let's start with mandatory benchmarking and disclosures. Is it a good idea?

Phil:
I personally believe that it's going to depend on what the customer, the building owner and the tenants, want to accomplish. Ultimately, at the end of the day, we're going to mandate that somebody benchmark their facility. Is that going to drive the property value up, is that going to help the building become more efficient? Only if the building owner cares about what their score is, or if the potential buyer of that building or occupant of that building.

So, by mandating it, that doesn't necessarily mean there's going to be any improvements. As an example the energy policy act a couple of years ago, back in 2005, mandated that all federal buildings needed to meter gas, electric and water, and I believe steam as well. But they also went one step further and said, "They've got to have energy reductions and CO2 reductions, year over year, for many years to come."

If you just have the mandate to monitor and meter, without the mandate or incentive to actually reduce it, then it's really just kind of a moot point.

So just mandating the monitoring and the benchmarking probably isn't going to do a whole heck of a lot -- other than one small thing that it will do, is to provide transparency into how well the building is operating, and somebody that is an owner would potentially have some incentive financially, economic incentive, to do something about it.

Denis:
Are we getting better at building facilities that perform long-term like they were designed to?

Phil:
Well I think it depends on what they were designed to do. I think there is a lot of times when buildings are designed for worst case scenarios. You know the 100 year storm, the hottest weather of the year that you might only see once or twice per year, or not for multiple years.

So when the design is trying to meet conditions that rarely if ever happen, then no we're probably not operating the most efficient buildings we possibly can, even though we might be meeting the design intent.

And that's really where monitoring on an ongoing basis comes into play. It really goes beyond monitoring the whole building, once you can start taking a look at major energy consuming subsystems -- HVAC for cooling and heating, and lighting systems. Then that will help you determine where you're using the most energy, and also help you define what's optimal for performance versus design intent, which again isn't always geared towards delivering the most efficient building.

Denis:
LEED and Energy Star give owners a financial incentive to make their buildings efficient. Is that not working?

Phil:
No I think that certainly, with USGBC's green buildings, I think that it is working. At least their statistics, on their studies say that it is working. Higher rent rates, occupancy levels, and those types of things; higher productivity within the building.

I think the reason that has been successful is because that goes beyond just efficiency. The green building goal isn't necessarily 100% geared around energy efficiency, it's to have, also, a healthy, productive, safe, indoor environment as well.

That's actually why sometimes you don't see more savings in a LEED certified building, because they're not trying to shut everything off. Their end goal isn't just efficiency regardless of the building comfort and productivity. It is to blend productivity and indoor comfort, along with energy efficiency, and water efficiency, and those types of things.

So when you have a potential tenant coming into a building, and evaluating a LEED certified building versus a non-LEED certified building, they're both going to be able to look how efficient it is and what their costs will be, assuming energy and water costs will be passed through to them. But also, how productive the environment is, and how that might impact their bottom line.

So I think because LEED takes a more holistic approach to the building than does Energy Star, that's just looking at emissions from energy use, I think that's more likely to drive up rent rates and occupancy levels, than just purely saying, "Here's what our energy efficiency score is."

Denis:
Will voluntary systems then eventually achieve enough efficiency in buildings, or do you expect to see more regulation crystallizing around examples like California's AB 1103, or LEED?

Phil:
I think it's going to be market driven. I mean the federal government really only is going to get involved with their own federally owned and occupied buildings and so as an example, several federal agencies have adopted LEED mandates for new construction.

There's 20-something states also that have mandated LEED for new construction facilities. But ultimately, at the end of the day, it's going to be the private enterprise who determines what their sustainability goals are going to be. Some will say it's purely going to be energy efficiency. Others will say they want to take a holistic approach, and do LEED platinum buildings. So it just depends, at the end of the day what gets adopted, on what ultimately appeals to the private sector, I think. And that's all over the board I think.

Ultimately, I think there has been a lot of standardization around LEED, because LEED uses other industry standards.

It didn't recreate an energy benchmarking tool. It references Energy Star and uses Energy Star 69 points as a prerequisite to get LEED, and it references ASHRAE standards, and other types of things.

So LEED didn't actually create a new standard, and that's why, I think, they have a bit of an advantage, and they've also gained so much momentum, is because they are leveraging existing building standards, and referencing those within their requirements. And that's picked up a lot of momentum. Because they're not creating new standards, as much as compiling and leveraging existing standards, that everybody has been following for years.

Denis:
Other organizations are creating new standards, like ASTM's guide for energy disclosure, or they're tightening them, like the international codes for energy conservation and green building -- are we just going to see more proliferation of competing standards?

Phil:
That's difficult for anybody to predict. But everybody is repositioning themselves over the past couple of years, as an environmentally friendly organization, whether it's government or private sector.

Just look at commercials on TV and billboards, and it's all centered around, you see automobile commercials, and the number one message is typically their fuel efficiency before they talk about their horsepower and torque and zero to sixty in whatever seconds. And it's waste management companies, and so forth -- IBM and Cisco with their smart grid.

Everything's around energy efficiency and green and those types of things, and so that repositioning has caused business to all want to get into this. Everybody wants to.

And so, because of all this momentum, the groundswell of attention on the environment and being socially responsible, more and more companies are trying to get into it. More associations are sprouting up, and that's why I think, you see that, but I think at the end of the day, as always seems to happen, the strongest and most sensible ones are going to bubble to the top, and all the others are going to fall off.

So, I think it's one of those things where it's past being a fad. It's not just the early adopters anymore. Everybody's getting into it and trying to find their place, but at the end of the day, it's going to be back to the reputable and logical associations, and standards, and companies that are still standing.

Denis:
Is building information modeling playing more of a role in those standards?

Phil:
Yes, there's more and more that you're hearing about BIM modeling and taking energy efficiency to the next level into that. And again, that goes back to what I said earlier, which is, a lot of times buildings are being designed for that worst case scenario, that 100 year storm and excessive temperatures that rarely come to fruition.

So a lot of the BIM modeling, now, is taking into consideration more likely use scenarios and weather conditions, but it's also taking into consideration things like more than they have in the past the positioning of the building to take advantage of day lighting, as an example.

That type of thing has been in the BIM modeling and other modeling, but there seems to be a lot more features and functionality. And now more and more manufacturers are writing their specifications so that when designers and architects are designing the buildings, they have equipment for every device that they can map in for the most energy efficiency.

So, there's definitely been some more momentum around incorporating more LEED standards, and, I should say, green building standards and energy efficiency standards, into the new building modeling.

Denis:
We'll take a quick break, then we'll talk more about the human factor with our guest, Phil Bomrad, director of energy services for the Siemens Building Technologies division. Stay with us.

This is the Building Priorities Briefing, I'm Denis Du Bois. Our topic is energy monitoring, and our guest is Phil Bomrad, Director of Energy Services for the Building Technologies Division of Siemens Industry.

Let's talk about continuous commissioning -- or whatever term -- what should we call it?

Phil:
There are a lot of terms out there that are really synonymous. Everybody has a different definition for some of these things -- retro-commissioning, re commissioning, ongoing commissioning -- but at the end of the day, ongoing commissioning is accomplished by doing some metering and monitoring on an ongoing basis.

So, there are multiple ways to do monitoring. You could install instrumentation in the building to actually measure the gas, electric, water, steam, whatever, and put that into a database and analyze that data on a regular basis, and that's the preferred method. That's what's going to have the most favorable outcomes.

But, you can also keep it much more simple than that and do the Energy Star benchmarking type of thing, where you're just taking a look at the billing information for the whole building. The billing cycle has ended, the bill has been generated and sent by the utility, and now you're just entering it into a database.

So, you don't have the transparency to see what's happening within the month. You don't have the transparency to be able to see what's happening equipment by equipment or subsystem by subsystem, but it's still a great way to identify your year over year trends and your overall efficiency as compared to a benchmark of a similar type building in close geographic proximity.

Denis:
And that's basically sufficient as far as LEED and Energy Star are concerned. They currently don't call for continuous commissioning, although LEED does offer credit for measurement and verification.

Phil:
So, there's different ends of the spectrum, so to speak. And the continuous ongoing building commissioning, typically, is going to require the metering and sub-metering installation of instrumentation at the building to collect that data in 5-minute or 15-minute intervals, typically, and send that back on a regular basis so that some algorithms and energy analysts can take a look at that data and identify what's actually occurring day-by-day, piece of equipment by piece of equipment.

That's much more effective and more in line with what a continuous energy optimization and commissioning program would be versus just your whole building Energy Star monitoring.

Denis:
Critics of LEED sometimes cite reports showing that certified buildings aren't much more efficient than code. Is that a matter of selective statistics?

Phil:
Typically, if buildings aren't operating as efficiently as was expected, then you have a problem there, and you have to go and see what's happening.

But I think a lot of times, people have expectations around energy efficiency and water efficiency and so forth in a LEED certified building because they just make the assumption that it's LEED certified, it will be energy efficient. But also keep in mind what I stated earlier about the goal of a green building and a LEED certified building; therefore, it's not just to be energy efficient, it's also to provide a safe and healthy and productive work environment, and you've got to balance the two. And sometimes, those two things are in direct contrast from one another.

You want a healthy environment so you bring in more outside air. The more outside air you bring in, the more you have to condition it, either heat it or cool it depending on the season, which is going to take more energy.

So, when you're trying to provide a healthy and productive and safe environment inside the building, the better you want to get, the more inefficiency you're going to realize on the energy efficiency side. So you have to balance the two.

And if there are building developers out there that are not experiencing energy savings with their LEED certified building, they probably should go back to the points that they were going after and that they achieved. And more than likely a lot of them were more on the materials and resources and indoor environmental quality categories than were on the energy and atmosphere categories. That's just a guess.

That's typically what happens when you hear statistics or results that green buildings aren't as efficient, or they're not more efficient than those built to traditional building standards.

Denis:
If you could influence regulations about monitoring, what would you want to change?

Phil:
The one thing that pops into my mind, we talked a little bit about it early on, but it's actually doing something with that data.

I had mentioned that just to mandate Energy Star benchmarking, that's fine, and maybe some people will actually take a look at that. But it's not just a matter of getting the data and providing that transparency. It's also a matter of somebody looking at the data and analyzing the opportunities to make improvements.

A lot of, I think, building owners, developers, and tenants don't really have those tools and skill sets within their organizations. But that's the key, really, to a successful and efficient building is not just getting the data, but doing something with the data, and calculating savings opportunities by looking at the data if you were to install new equipment or implement new processes and sequence of operations and those types of things.

So, that's a critical piece. And I'm glad that when the federal government did the Energy Policy Act a handful of years ago, that they didn't just put the mandate for metering in, they also put the mandate in for certain energy reductions, year by year. And that can't be forgotten because ultimately at the end of the day we're not metering and monitoring just for the sake of meeting legislation. We should be doing so to actually make improvements to our operations.

Denis:
Occupant behavior is the big wildcard in building energy use. Do we have the tools to predict the effect of occupant behavior on energy?

Phil:
There are some, but you never do know ultimately, at the end of the day, what the building occupants; how they're going to run it. Occupants, and also the operations of the building, is going to play a key role. And that's why the continuous and ongoing monitoring and commissioning is such an important thing to implement is because, especially if somebody spent the time and money, if they made the investment in getting a LEED certified building in the new construction and the construction of the building, then it behooves them to try.

You would think that they would also want to operate that building to efficient standards and therefore the way that you operate it well, to continually understand what's going on and where things are not performing.

And that's where the metering and sub-metering, looking at mechanical systems on a regular basis, by way of monitoring, is going to help you realize the savings that you would expect to see on an ongoing basis.

So even if the building operators are starting up the building too early or they don't have the shutdown at the end of the day scheduled properly, if the sequence of operations isn't optimal, that's OK if we have somebody doing the ongoing commissioning of the building. Same thing as tenants override systems. The lights shut off at 6:30 in the evening but then they immediately go back on and they stay on overnight.

When you're looking at the data and you've got algorithms to flag those anomalies, you can immediately make corrections. And so that's why it's important to do the ongoing commissioning, is so that operators and tenants can't interfere with the investments that have been made, on the front end, to have an efficient building.

Denis:
Is occupant education part of that?

Phil:
I think it is. If you think about it, you don't just need to provide the transparency but you have to make people aware of how their behavior can impact the energy efficiency.

So it's really two parts to the puzzle there. Number one is the awareness program that helps occupants and operators understand how their behavior impacts efficiency, and costs for that matter. But then you also need to provide them the transparency to be able to see what the impact of their behavior is having on the building.

And that's again, for the building operator, certainly, where a continuous and ongoing commissioning program would help them identify, "Oh boy, I can see what's happening to the efficiency of the building by me starting up at 4:30 in the morning, even though the building doesn't need that long to recover."

And it's the same thing for the occupants. If you can put displays in lobbies, and poster boards, and report cards, and things like that, that helps them be aware of their behavior and the impact that their behavior is having on efficiency, then they're more likely to change their behavior. But they won't change their behavior if they don't understand how to change their behavior, and that's where the awareness and the educational piece comes in.

So it's really a two-pronged approach. You have to make them aware, and educate them, and also give them the transparency, just like looking at the scale in the morning. You get on the scale, you see what you weigh, you know that the pizza you ate the night before probably wasn't the best thing to do, because you have that transparency.

Denis:
I'll remember that tomorrow morning. [laughter]

Phil Bomrad, director of energy services for Siemens Industry Building Technologies Division, thanks very much for spending the time with us today.

Phil:
My pleasure.

Part 4 - What can you do today?

Denis: Transparency is the key word as governments strengthen requirements for energy monitoring and reporting.

If you're buying a building or leasing space, a benchmark score is very helpful in comparison shopping. Just dividing the annual energy bill by the square feet doesn't factor in differences like tenant activity, location, and weather. The EPA Portfolio Manager score at least gives you an apples-to-apples comparison.

Once you're moved into a building, it's helpful to know that it won't suddenly start wasting energy at your expense. Continuous commissioning keeps an eye on energy consumption and exposes problems early on.

As the owner, you can use energy metrics to prioritize improvements that make your building more energy efficient. They benefit you whether you're the occupant -- with lower energy expenses -- or you're the landlord -- with higher building valuations.

Either the market or the legislature will soon require owners everywhere to disclose the energy scores of their buildings, and organizations like the EPA and ASTM are standardizing the process.

Once that happens, owners will be under pressure to improve the score, either voluntarily, or by law.

What can you do now?

Take control of energy before a difficult target is dictated to you by regulations. Find ways to make early compliance a competitive advantage.

When you benchmark your buildings, do it accurately. Any methods of gaming the score will disappear sooner or later and a low score is least damaging now.

Think long-term and expect more, not less, reporting requirements. Put systems in place that allow you to track and document important information. Invest in education for staff involved in this process.

While you're measuring energy, you might as well measure carbon, water, indoor air quality, and landfill waste, especially if you own the buildings you're in. Employees and customers care about these things.

Related:

"Revealing Ratings to Validate Value of Energy Efficient Space" - Building Priorities Briefing

"Energy Monitoring" - Energy:Minute

"Codes of Conduct" Sustainable Industries Journal

"Green Building Criteria and Benchmarking Evolving Rapidly in Marketplace" (on ASTM) Bureau of National Affairs newsletter

NBI LEED Study