High-Performance Energy Buildings

“High-performance energy buildings are the wave of the future in the commercial market.” Bryan Garcia, CEO, Connecticut Green Bank

If you’re old enough to remember when the fuel economy labels started showing up on new car windows there’s a good chance you’ll remember your first appreciation of the importance of MPG or miles per gallon.

There was a time when a car was purchased because of its looks or, as was often the case in the 50’s and 60’s, because it was a muscle car! Little attention was paid to how many miles per gallon it would get – gas was cheap and nobody cared!

That all changed after the 1973 Arab oil embargo. In a very short period of time the government mandated that cars be sold with a declaration of how many miles per gallon they could achieve. When gas was scarce, what was important was a car that was efficient! A car that would go a long distance using the least amount of gas was the preferred vehicle!

That same dynamic is occurring with the energy efficiency of commercial buildings. An article published last week in the New England Real Estate Journal introduced the concept of high performance buildings. Just like a car that has a greater appeal because of a high MPG rating, buildings with a high energy efficiency rating are expected to be in the greatest demand in the near future. Here is how the article explained the advantage of the high performance energy buildings.

“In an increasingly competitive real estate market, commercial buildings with high energy performance outpace their neighbors on operating expenses; rent premiums, occupancy and asset value. By significantly reducing utility costs, upgrades like high-efficiency lighting, HVAC systems and solar energy systems result in dramatically increased NOI and drive new cash flows that are capitalized into asset value.” Genevieve Sherman, Connecticut Green Bank

To turn an older building, that typically wastes a great deal of energy, into a high performance property, requires a holistic approach to maximize results. Simply installing the latest LED lighting won’t give a building the overall performance the market is now giving greater attention to. A holistic approach involves looking at all areas where energy is being used and incorporating high performance technology to maximize efficiency. And today it also requires looking for areas where energy can be generated!

“Relative energy performance in these markets will increasingly become a factor in which properties are priced at point of sale,” Bryan Garcia president and CEO, Connecticut Green Bank

A perfect example of the need for improved energy performance was evident last week as a team from EAG did an onsite evaluation of a university research facility. According to Sudhakar G. Reddy, Sustainable Labs Coordinator at the University of Michigan, research labs consume 4 – 10 times as much energy as the typical classroom. Controlling those excessive energy costs is a realistic way for labs and universities to become more competitive.

The initial field report from that onsite visit contained an interesting description of the dramatic inefficiencies that can creep into a commercial building. The report described the problems within the lab spaces in this way:

“Without sealing each area off from the other, the adjacent HVAC systems continually battle themselves to heat, cool and bring in fresh air. In a research lab setting, when people are in the lab, there is a need to maintain a rate of fresh air exchanges per hour. Their doors are always open for ventilation! Rather than trying to control 20,000 sq. ft. of lab space, the HVAC systems are trying to control 60,000 sq. ft. between the three labs. Systems engineers use safety factors, but not a 300% capacity overload!”

A holistic solution to the problem was suggested in the same report with this initial assessment:

“There are some peripheral opportunities such as self closing window shades, doors, door operators, sample freezers, refrigerators, etc. But the big efficiency gains will come thru lighting, motion sensing, daylight harvesting, and HVAC air flow controls.”

The holistic approach to high performance buildings comes with an upfront cost that has created a barrier to upgrading in the past. To overcome that barrier an innovative program known as Property Assessed Clean Energy or PACE* is being utilized on a growing number of sustainable or energy efficiency renovations and the use of the program is growing exponentially!

Older commercial buildings that undergo a holistic energy efficiency renovation, and achieve a high performance rating, will experience significant competitive advantages in the marketplace. A high performance rating will benefit not only the building owner but also the tenants within the building and the community (or campus) surrounding the structure. High performance buildings that embrace sustainable initiatives are truly the wave of the future!

* If you would like to learn more about PACE financing and how it can help you or your business with energy efficiency, Scott Ringlein, CEO of The Energy Alliance Group of Michigan, will lead a free, online webinar on July 15th that will provide a PACE overview. The content of the webinar will be useful to anyone interested in sustainability, energy efficiency, energy efficient technology sales and reducing energy expense. Click HERE for more information.

The Energy Alliance Group of Michigan is a leader in clean energy PACE project development and financing.