The Building Advisor

Is it us, or does it feel like it’s all about us lately?

Building Retrofits Need an Extreme Makeover -Reuters – “the industry as a whole needs a robust set of data on post-retrofit performance and payback before they will be convinced that the opportunity to reduce operating costs is real, the risks are low, and the ROI is high enough to justify investments in efficiency.”

Image by Ben Heine

How the Fate of PACE Could Influence the Clean Energy Economy – GreenBiz.com – PACE financing is a potentially revolutionary way to retrofit commercial, residential, and industrial properties with energy efficiency and renewable energy technologies. The program overcomes one of the largest hurdles to investment in clean energy — the upfront cost.”

Creating 625,000 jobs and saving $64 billion through energy efficiency – Grist – “Efficiency Works” [PDF], a major new report by Bracken Hendricks, Bill Campbell, and Pen Goodale, finds that a straightforward set of policies aimed at upgrading just 40 percent of the residential and commercial building stock in the United States would:

• Create 625,000 sustained full-time jobs over a decade.
• Spark $500 billion in new investments to upgrade 50 million homes and office buildings.
• Generate as much as $64 billion a year in cost savings for U.S. ratepayers, freeing consumers to spend their money in more productive ways.

Universal Benchmarking Is Essential in the Fight Against Global Warming – Huffington Post – “We need the benchmark numbers to motivate change. Without them, how will we measure progress? How will we create the most effective policies and incentives?”

Image: Ben Heine’s photostream on Flickr

Sauer Incorporated's HQ in Jacksonville, Florida

If the existing building stock of commercial real estate in the U.S. is an agreed-upon goldmine for energy savings, hospitals and health care facilities represent a pot of gold at the end of the efficiency rainbow.

Hospitals use about 2.5 times the amount of energy as a similar-sized commercial building, according to a 2009 estimate published in Environmental Leader. “As a sector, hospitals and health care facilities account for a disproportionate amount of energy use and emissions, EL’s article “Hospitals Due for Energy Efficiency Overhaul” states.

Ed Brady made the healthcare / efficiency connection with BuildingAdvice. Brady, a Service Account Representative for mechanical contracting company Sauer, Inc.’s Columbus, OH location, started using BuildingAdvice in early 2010. In only a few months of using the efficiency platform for commercial buildings, Brady had quoted $750,000 in energy efficiency retrofits to Fayette County Memorial Hospital, a two-building, critical access hospital in Columbus.

“Fayette was ready to think more seriously about their energy spend,” Brady said by phone in August.

Sauer, a four-branch company with an annual revenue of $478 million, had committed to pursuing energy services as part of its overall corporate strategy this year. Sauer, Inc. sister company Ruthrauff Sauer, based in Pittsburgh, PA, recommended BuildingAdvice to Brady and his associates in January of this year. The following month, Brady was putting AirAdvice’s industry-leading energy services platform to work.

“We needed a competitive edge to both maintain existing service agreements and expand new ones,” said Brady. He worked with his AirAdvice support representative, Zack Buquet, to discuss and design a marketing strategy around the product. Together, they agreed that offering free benchmarking was the strategy that best fit Sauer’s needs.

Fayette County Memorial Hospital

“The contract customers weren’t biting on the energy services,” said Brady of his existing client base. “We found that by offering free benchmarking, you will definitely get potential new clients and some nice first meetings,” Brady said. “It doesn’t really take that much of my time to do the benchmarking.”

Brady had done roughly seven benchmarks for a variety of property types when he approached Fayette County Memorial Hospital, whose leadership showed a very favorable reaction to the energy benchmark – especially considering one building scored the lowest on the EnergyStar ratings scale possible, the other very low.

After performing a complete canvas of all mechanical equipment, Brady and associates found boilers from 1974, outdated cooling towers, and rooftop units near ASHRAE end-of-life. Sauer budgeted replacement costs, estimated paybacks and used a BuildingAdvice Energy Audit to propose, among other retrofits:

• $500,000 to replace old boilers and pipes
• $185,000 for rooftop unit replacement
• $20,000 for lighting

The meeting went well, and the hospital is seeking funding by to pay for the bulk of the work by early 2011. In the meantime, the hospital will use in-house resources to address the low-cost recommendation from BuildingAdvice’s Energy Assessment to replace the lighting system. Savings from these upgrades will be show results to be evaluated in January, particularly in electrical usage. The hospital is then eligible to push the lighting retrofit through the local utility to become eligible for rebates.

Brady is clear that his relationship with Fayette is due 100% to starting the energy conversation and following up with BuildingAdvice reports. Doing the assessment allowed him to get in the door, survey the entire facility and identify all of this project work.

Ruthrauff Sauer, Pittsburgh, Pennsylvania

Moreover, Brady has discussed ongoing continuous energy monitoring – another service available through BuildingAdvice – after the hospital has its equipment replaced, to monitor, manage, and ensure ongoing energy savings “in real time,” as Brady puts it.

“BuildingAdvice not only gets people’s attention, it’s useful,” said Brady. “We have had some great successes already.”

I mean look at this guy. Don't you want his help with energy conservation measures?

This week, Joey Penneman went from interning at AirAdvice as a student at the Northwest Energy Efficiency Institute at Lane Community College, to becoming a full time employee at AirAdvice.

For the past six weeks, Joey has been slaving away doing laundry and dishes – er, learning the ropes – at AirAdvice’s downtown Portland offices.

Joey’s duties as an intern were to research and develop the calculations for AirAdvice’s new Residential SmartEnergy Report, the Chiller Diagnostic Application and our Industrial Benchmarking and Diagnostic Application.

“Joey made significant strides after his first two weeks of onboarding projects and trainings,” said Lucas Klesh, AirAdvice Product & Building Expert. “He showed an adept willingness to work with customers in report interpretation and recommendations, which suits the position perfectly.”

As an Associate Energy Analyst, Joey will work with BuildingAdvice channel partners in providing support and training to our customer base on the best practices of implementing BuildingAdvice from a technical perspective. Moreover, he’ll help our customers identify and implement savings opportunities identified by BuildingAdvice’s assessment and audit reports.

After all, getting a contractor rock solid on exactly what energy conservation measures (ECMs) he should suggest to the end user is the best way to drive home imminent savings and project work.

Joey will also continue to assist in developing new products.

Truth be told, Joey is our second employee from Lane’s crack energy training program. Stephen Green, another Associate Energy Analyst, joined AirAdvice under the same auspices earlier this year.

Very exciting news around AirAdvice. Joanna Turpin, Contributing Editor of The Air Conditioning, Heating, and Refrigeration News and Contractor Excellence, interviewed our very own Tim Kensok, Director of Business Development, yesterday for an article in The NEWS’ November issue on commercial energy audits. After speaking with Tim for the better part of an hour, Joanna called Tim “a virtual fount of knowledge!”

What else is going on? In the Charlotte Business Journal, contributing writer Julie Bird wrote this article last week: Finding a work force for energy. It asks what mid-career engineers can be doing to train themselves for a transition into the energy industry. Funny, Tim talked about that quite a bit for The NEWS. In fact, The Building Advisor has always known what a big part of our services sales training represents, but to hear Tim talk about it, it’s almost as if BuildingAdvice were secondary. What we’re really focused on as a company is helping HVAC contractors find ways to deliver and benefit from offering a new offering: energy savings.

So if there are any contractors in Charlotte who saw the article and want to know more, all they have to do is check out one of our free webinars (or the materials we archive online).

Lastly, in Philadelphia, The Energy Commercialization Institute awarded half a million dollars to eight research projects that will “advance the development of promising energy technologies” (Energy Commercialization gets research money – Philadelphia Business Journal). The Institute was set up with state money and established by Ben Franklin Technology Partners of Southeastern Pennsylvania and Drexel University, the University of Pennsylvania and Pennsylvania State University.

$160,522 was awarded to five business-university partnerships from the Institute’s Energy Sponsored Research Agreement Fund, which funds projects that businesses are paying universities to help them with, and matches the amount of money being put up by the businesses. Another $350,000 went to three university partnerships from the Energy Translational Research Fund, which provides money to research projects involving more than one university that it thinks will produce results that can be commercialized.

This time around the projects included automotive and industrial applications, low cost printable solar cells, energy storage from smart grid technology, wind turbines, greenhouse-gas emission-free hydrogen fuel from fossil fuel, the development of liquid fuels from low-quality coals and inexpensive components for solar cells.

No energy efficiency technology.

Images courtesy Flickriver and Energy Commercialization Institute.

A month ago,Chris H., Assistant Global Energy Solutions Manager at Solutia Inc., posted “Five Overlooked Building Improvements with Quick ROI that Increase Energy Efficiency” to myfacilities.net.

In it, he touches on a variety of utility-saving solutions, the most pertinent to The Building Advisor being number 3, Energy Management Systems.

He writes,

Greg Galusha of MacDonald Miller in Bellevue, WA

“An energy management system consists of a combination of building management systems and advanced software solutions that work together to control a building’s HVAC operations…The system ensures optimal energy usage, resulting in greater efficiency and lower utility costs.”

He then posted the post to the Building Owners and Managers (BOMA) International LinkedIn Group under the question header, “How can you increase energy efficiency and reduce utilities?”

To date, there have been 56 comments.

Some of them have been from blog spotlightees before, like Greg Galusha of MacDonald-Miller Facility Solutions (“MacDonald-Miller Finds BuildingAdvice Perfect Fit for Energy Efficiency in Small to Midsize Buildings“) and Zack Buquet, one of our own here at AirAdvice and a Building Advisor contributor.

The long and the short of it is this: talk of replacing HVAC units, building envelopes, window film, demand response, lighting, and reflective insulators, elevator motor “soft starters.” From the short and sweet to vociferously verbose, there is no shortage of ideas out there on how to save dough on energy. We just need to DO it.

Great comments from Gary Markowitz, President, Kilojolts Consulting Group, Inc. & KCG Energy LLC. Gary touches on culture – shifting the mindset of a company toward energy efficiency as a priority. Julius Walcyznski at Canada’s Pulse Energy has some great things to say as well regarding occupant engagement.

Zack Buquet, Energy Services Business Consultant at AirAdvice

But here at AirAdvice, we’re looking at the causes of energy waste in buildings, and work with HVAC contractors to attack the problem. Those contractors in turn work directly with the building owners and managers BOMA serves, the decisionmakers behind energy efficiency decisions. Until those owners and managers recognize that they are throwing money away unnecessarily, the building’s occupant engagement can’t happen.

BOMA’s LinkedIn discussion also contains quite a bit of chatter around energy benchmarking, assessments and audits; it’s great to hear these words being used with knowledge, even if it is within a fairly specific community.

Mike Zimmerman, CEO of BuildingIQ in Sydney, Australia, wrote:

Mike Zimmerman, CEO of BuildingIQ

“…Energy Reporting systems such as Lucid Designs provides energy-use metrics from meters and the BMS [Building Management System?]. There are also now Energy Optimization technologies that supervise how the BMS runs and and make the building much more intelligent. Our system, called BuildingIQ…is a Predictive Energy Optimization system that incorporates energy prices, weather forecasts and ASHRAE comfort models to optimize energy use, cost and comfort. This type of proactive system that interacts with the BMS can save 10-20% of total building energy and is paid for on a subscription basis…”

Throughout the conversation, claims of savings between 10-30% on utility bills are made.

Where do you think a realistic savings percentage average from the use of energy management systems looks like?

And is this savings driven more by occupants or building systems?

Drop us a comment!

Shell Ridge Property Management Co., Inc. maintains approximately 300,000 square feet of commercial space in the San Francisco Bay Area. Since 1980, Shell Ridge has specialized in asset management strategies for small medical offices. Its 15 buildings range from 40,000 to 100,000 square feet.

Shell Ridge’s medical office properties represent a desirable portfolio for mechanical contractors. Marina Mechanical, a 50-year-old company headquartered in San Leandro, Calif., began maintenance for a Pleasanton, Calif. Shell Ridge property five years ago. In the ensuing years of service, energy conservation was rarely discussed.

But when Marina began feeling heat from its competitors in the middle of a down market, it turned to its best customers to expand relationships.

Marina had obtained training on the BuildingAdvice energy services diagnostic platform in November of 2009, and began the process of leveraging its action-oriented reports as a differentiator.

Gamechanging Energy Services Offering

“We offered to show both the property manager and owner at Shell Ridge, some sample energy benchmarking and assessment reports,” says Denny Mann, Vice President of Service with Marina Mechanical, when explaining how he got the energy conversation started. “The property manager was actually very educated on energy benchmarking, and as a result, very interested. Once she saw the type of information the BuildingAdvice reports gave, she was extremely interested.”

“BuildingAdvice differentiated Marina from other mechanical contractors waiting to get their foot in the door,” says Denny.

Denny offered to do complimentary energy assessments on two Shell Ridge buildings. Shell Ridge has several buildings where Peak Day Pricing, a program of local utility Pacific Gas & Electric (PG&E), would come into play.

Peak Day Pricing (PDP) is PG&E’s demand response program, which acts as an incentive for business owners to curtail their facility’s energy use during times of peak usage. During the summer, PDP substantially raises energy prices on “event days” (above 98 degrees); businesses have a 24 hour notice when there will be an event to lower their energy usage for that day.  By charging a very high rate on event days, PG&E motivates customers to invest in strategies that will lower their consumption overall, and especially on the peak days.

Peak day pricing is specialized to the PGE territory, but not a unique phenomenon.

“Peak day pricing is definitely acting as a market stimulator for energy services and spurs client interest,” Denny said. “I think soon people will be lined up to get involved with energy reduction conversations.”

Taking Action

In going over the results of the assessment reports, conversations began about what Marina could do to help Shell Ridge avoid demand charges across the company’s property portfolio.

Which led to a second meeting with the owner, and an agreement to generate Energy Benchmarking Reports on all of the Shell Ridge properties to determine Energy Star scores.

“BuildingAdvice reports marked our transition from just being their mechanical contractor to forming a partnership. It completely transformed the relationship,” says Denny.

With portfolio-wide benchmarks on the docket, Marina took recommendations from the first two properties’ energy assessments to Shell Ridge ownership.

“BuildingAdvice helped us identify that the building was running when it didn’t need to be,” said Denny. Supply and reset strategies were created, so that the building was not not pouring 55 degree air into the interior when clients were not there, all of which were identified in the report.

Two low- and no-cost recommendations were approved and completed April of this year. Shell Ridge made the decision to complete the service based on the return on investment outlined in BuildingAdvice’s Energy Assessment Report. In addition to revisions to lighting and HVAC schedules based on peak day pricing, the report showed a seven-year payback on a demand control vent.

“We’re letting those changes take effect,” said Denny. After a 12-month period, savings achieved will be tabulated.

Next Steps and the Advent of Mandatory Energy Disclosure

As of late June, Marina wrapped up the energy benchmarking process on all of the Shell Ridge portfolio. Based on buildings’ Energy Star scores, Marina will make recommendations on which properties need energy assessments.

Looking ahead, the mandates of California’s Assembly Bill 1103 (AB 1103) state that non-residential business owners or their agents are required to input energy consumption and other building data into the Environmental Protection Agency’s Energy Star Portfolio Manager system, which generates an energy efficiency rating for the building.

As of January 1, 2010, AB 1103 mandated disclosure of a building’s energy data and rating of the previous year to prospective buyers and lessees of the entire building or lenders financing the entire building. That deadline has since been pushed back, and the task of devising a disclosure schedule has fallen to the California Energy Commission (CEC). The CEC is in the process of drafting a new compliance schedule; January 1, 2011 is speculated to be the new required disclosure date.

New York City, Washington DC and other regions have adopted similar required energy data disclosure. Smart owners and managers are on the move to meet deadlines.

Net Impact

The ability to offer energy services differentiates providers. Marina knew a competitor was making an aggressive play for service agreements in Shell Ridge’s multiple locations. Yet, in the same timeframe Marina stayed in discussions with Shell Ridge by centering their meetings around energy services through BuildingAdvice.

“After going through BuildingAdvice training, we quickly realized that being able to offer our customers a systematic, low-cost / no-cost approach to reducing their energy consumption would change the way we were viewed.”

BuildingAdvice has “helped us retain current business and significantly raised the bar on the services we offer.”

The youngest SF Mayor in we can't remember how long.

San Francisco pulled into the lead for most progressive energy policy last week when Mayor Gavin Newsom (at 42, the youngest San Francisco mayor in over a century) submitted his nine-months-in-the-making proposed legislation on existing commercial buildings to the city’s Board of Supervisors.

The proposed legislation would require the owners of commercial buildings over 5,000 square feet to conduct an energy-efficiency audit every five years, and to supply annual updates – all of which would be available in a public database, according to the SF Gate.

And guess what? These required audits would come back with helpful suggestions on how to increase the property’s energy efficiency, say by sealing windows, or upgrading the HVAC system. Kind of like what BuildingAdvice does. Tenants would also have access to an estimate of resulting energy savings from taking those steps, the cost of implementing them, and their economic value.

Kind of like what BuildingAdvice does.

In a post on City Insider, an SF Gate blog on “the people, politics and places of San Francisco,” John Coté wrote that Newsom likened the commercial building audits to fuel efficiency ratings listed on car windows at an auto dealership.

Is your building a Lex? Or a hum-v?

The local branch of the Building Owners and Managers Association (part of nationwide BOMA), the commercial real estate industry’s heavy-hitting advocacy group, supports the legislation, although there are still skeptics in the business community, the mayor said. Berkeley, Sonoma County, Palm Desert and Boulder, Colo. have similar programs going.

Once approved, the legislation sets a staggered, three-year schedule for compliance, starting in April.

Images courtesy Car and Driver and http://obrag.org.

Portland-based PECI has won an $18.8 million contract from the California Energy Commission to manage an “EnergySmart Jobs” program that will create more than 200 California jobs.

The “EnergySmart Jobs” program will provide energy efficiency training throughout California to implement efficiency upgrades on commercial buildings. The company will also hire and retain over 200 contractor and energy surveyor positions. The program will focus on regions within California with lots of opportunity for efficiency savings and high unemployment.

The 18-month program is paid for with American Recovery and Reinvestment Act funding and is slated to deliver $13.9 million in initial energy savings for electricity rate payers during the first year and a half.

The program will also create three jobs in Portland, Sustainable Business Oregon reports.

Additional program partners include private contractors, utilities, manufacturers, and the California Conservation Corps. “The Conservation Corps ‘Corpsmembers’ are comprised of unemployed or otherwise economically disadvantaged people between the ages of 18 and 25, with the intention of helping those in greatest need get a ‘head start’ in the employment market,” according to PECI’s press release.

PECI has a longstanding relationship with the State of California, having delivered energy efficiency programs throughout the state for 20 years and employing 28 in the state.

Contractor Magazine recently published an article titled, “What Bad Looks Like” in which it described the state of the mechanical contracting industry.  It lists the largest contracting firms and provides breakdowns by markets served, type of work, and geography.  Not surprisingly, the bottom line is that the bottom line isn’t so good these days.

A “tough year.”  Yes, it’s been a bit tough.  And the only markets predicted to improve in the near term are healthcare, educational, public safety and transportation.

Fine, yes, the contracting business is a difficult one these days.  I think we all knew that.  But, what did we at AirAdvice take from this article?  I zeroed-in on two quotes from industry leaders:

• “As I’ve talked to our MCAA affiliates, I’ve said [energy savings retrofits] is the industry that we should own.  While we are going through this slow period, now is the time to renew ourselves and focus on green and sustainable initiatives. MCAA President Bob Armistead is taking the same charge and pushing it forward.” - Lonnie Coleman, president of Coleman-Spohn Corp., Cleveland, and past president of the Mechanical Contractors Association of America.
• “We’ll focus our energy on where the work is.  We’ll get in front of customers with good energy-saving ideas on how to take cost out of their businesses.” – Tony Guzzi, President and COO of EMCOR Group.

Could be just me, but I think they’re saying that energy savings is where it’s at for contractors right now.  So, there’s the bright spot and it is bright indeed.  The vast majority of buildings that are going to be here in 20-25 years are here now.  Retrofitting those buildings to new standards of energy efficiency, and driving down their operating costs, is THE opportunity for contractors.  Lonnie Coleman is right – contractors should own this business.

Image courtesy of Blue Ridge Blue Collar Girl blog

New York is definitely where its at these days, what with those mandatory benchmarking laws swinging into effect and the Empire State Building’s and sustainable upgrades showing folks how it’s done.

Rep. Carolyn Maloney (D-NY) posted a byline in the Huffington Post on the iconic spire (did you know it is officially a Wonder of the World?), outlining the genius of the Empire State Building’s overhaul:

“…the retrofit will deliver improved windows, high-efficiency light bulbs, and among many other things, renovated heating and cooling systems at a cost of $13 million after netting out other savings. By 2013, this plan will have reduced the Empire State Building’s energy usage by 40%. The $4.4 million in annual energy savings will have completely paid for the costs of the retrofit project 3 years after completion.”

The story behind the retrofits is told at the Empire State Building sustainability exhibit, where a glowing cube and other interactive elements beckon visitors to look underneath the landmark at the energy saving innovations beneath.

Right now, the Empire State Building consumes the energy equivalent of 40,000 single-family homes.

Rep. Maloney writes about how she convened a hearing to learn more about the Empire State Building’s energy efficiency progress. She emerged learning a few things, one of them being,

“…government has a role to play in shining a spotlight on the economic, environmental and consumer benefits of retrofits, but it is the private and non-profit sectors that will roll up their sleeves, nail down the economics and make these retrofits happen.”

Across the Empire State, buildings are smartening up, with no little thanks to OptimumEnergy. The Sun-Herald.com picked up this press release from OptimumEnergy, maker of software to increase energy efficiency through HVAC, which trumpets the company’s latest New York state deals (including the 1271 Avenue of the Americas building in New York City; a GE Healthcare manufacturing facility in Troy; and Westfield Group’s Sunrise shopping center in Massapequa). OptimumEnergy estimates its reduction software to save 9.9M kWh annually across the building portfolio.

In honor of that The Building Advisor offers you this break from our regularly scheduled programming.

“Empire State of Mind”

In other news this week, EarthTechling decided to accentuate the negative in its coverage of the recent report from Pike Research, “Commercial Green Retrofit Interest Low.” Yes, they do point out the $41.1 billion potential savings from retrofits for new construction over the next 10 years. On the downside, nobody cares, apparently.

New York will fix that!

Images courtesy Doobybrain.com, Inhabitat and YouTube.