Friday, April 24, 2009

Significant Debate Over NAIOP Building Energy Savings Study

In December 2008, ConSol (an energy modeling firm), working under contract to NAIOP (the Commercial Real Estate Development Association), released it study, Achieving 30% and 50% over ASHRAE 90.1-2004 in a Low-Rise Office Building. Much controversy followed over the conclusions reached in this study. Rather than take a position, permit me to present the facts as I see them and you can draw your own conclusion.
ConSol responded to an RFP from NAIOP asking for an analysis of a recently constructed low-rise office building, and the practicality of building it 30% and 50% above the ASHRAE 90.1-2004 Energy Standard in three locations: Newport Beach, CA, Baltimore, MD and Chicago, IL. For its analysis, ConSol used EnergyPlus v2.2, the U.S. Department of Energy's building energy simulation program for modeling building heating, cooling, lighting, ventilation and other energy uses. The methodology was based on a modified version of ASHRAE 90.1-2004 Appendix G. Modifications included the exception of non-regulated loads, baseline glazing and energy savings, not energy cost, as the metric. It was deemed appropriate to focus solely on regulated loads as only they could be affected by jurisdictional energy codes. Baseline glazing was set at 50% to most accurately maintain architectural similarity to the actual building as constructed. The baseline building was a recently completed Class A, low-rise, office building with 95,000 square feet in 4 stories (each of average height at 14 feet) having an HVAC system that consisted of VAV with terminal reheat and a gas fired boiler.
While there are 7 climate zones in the U.S., the simulation building locations included in ConSol's scope of work were in only three climate zones: 3, 4 and 5. ASHRAE's 90.1 standard has separate requirements (for insulation, glazing, HVAC and lighting) associated with each climate zone, and these were used in the ConSol simulation.
The energy efficiency measures above ASHRAE 90.1 that ConSol assessed included: better roof and wall insulation, varying levels of exterior window glazing, reduced air infiltration (via the installation of an air barrier), reduced lighting power densities and higher efficiency HVAC equipment. Cost information was obtained using the RSMeans Green Building Cost Estimating Database, published data and personal correspondence with equipment manufacturers. State average utility (electricity and natural gas) prices were used as compiled by the Energy Information Administration (retrieved in December 2008). The payback period in years was determined by simply dividing the marginal cost of the energy conservation measures above ASHRAE 90.1 by the annual utility savings. Peak kilowatt savings were not included in the analysis.
ConSol determined that the Newport Beach model building achieved 15.8% energy savings over ASHRAE 90.1 at a marginal cost of $169,900 corresponding to a 12.2 year payback. The Baltimore model building achieved 21.5% energy savings at a marginal cost of $165,150 corresponding to an 11 year payback, and the Chicago model building, a 23% energy savings at a marginal cost of $188,500 corresponding to an 8.8 year payback. The conclusion was that achieving 30% - 50% energy savings in a newly-constructed, low-rise, Class A, office building over ASHRAE 90.1-2004 would be difficult to achieve.
A number of issues have been raised to question the validity of this study and its conclusions. These include:
(1) Actual utility rate schedules were not used in the analysis and pricing associated with peak demand periods was therefore not factored in (and it should have been since buildings normally operate during periods of peak energy demand). This would have significantly increased the energy savings.
(2) Utility rate increases were not factored into the analysis. This would have further increased the energy savings.
(3) Financial incentives and rebates were not factored into the analysis, which would have reduced marginal costs for the energy saving measures above ASHRAE 90.1-2004.
(4) The same building model was used for all three climate zones, rather than fitting the design to the location. For example, it would have been appropriate to use operable windows for ventilation in the Newport Beach model. Also, window design alternatives that could take advantage of natural light for daylight and sunlight for heating were not considered.
(5) The study only considered a limited number of energy saving measures (above ASHRAE 90.1-2004). For example, use of an energy management control system (with occupancy sensors to turn off lights, etc.) was not considered, and it would be today. Rather than merely "bolting-on" energy efficiency measures, today such measures would likely be considered as part of an integrated building design. (ConSol did indicate that certain energy efficiency measures, such as evaporative cooling technologies and light emitting diode (LED) lighting systems, were not included in the study due to lack of modeling capability, insufficient data or that they were outside the project scope.)
(6) The study failed to consider, even conceptually, other factors that may be associated with energy efficient buildings, including the possibility of these buildings commanding higher rents and experiencing higher occupancy. These dollars could also be used to offset the marginal costs for energy saving measures above ASHRAE 90.1-2004.
Clearly, a strong case can be made that the NAIOP/ConSol study has a number of significant limitations and should not be generalized. What do you think?

Thursday, April 2, 2009

National Building Energy Performance Disclosure?

Recent action in the House of Representatives made some significant strides in advancing proposals for energy efficiency policy. Representatives Henry Waxman (D-CA) and Ed Markey (D-MA) released a their bill, called the American Clean Energy and Security Act, containing climate change legislation and a variety of energy efficiency provisions, but most notably for the commercial real estate industry:

(1) A new Retrofit for Energy and Environmental Performance (REEP) program to promote comprehensive efficiency retrofits to commercial buildings (and also to homes), reducing energy consumption by an average of 20% or more.

(2) A provision directing that building codes be strengthened to reduce energy use in new buildings by 30% starting in 2010 and 50% starting in 2016.

(3) A provision establishing a building labeling program so that owners and prospective purchasers and tenants can compare energy use of a particular building to similar buildings in their local area.

With building energy performance disclosure already underway in California (required under AB 1103), and Ohio, Minnesota, Denver and New York City considering similar measures, the "train clearly has left the station." You have to be blind not to see the handwriting on the wall! There can be no question now that energy efficient buildings will have a competitive advantage in the commercial real estate market.

Four T's for Quick Energy Savings in Existing Buildings

In my experience with existing buildings, if you follow the four T’s for saving energy: Tune it up, Turn it down, Turn it off and Track it, you should be able to reduce energy consumption by at least 10-15% without significant cost.

Tune it up would include optimizing your ventilation rates (you want to condition the least amount of outside air necessary to maintain proper air quality inside your building) and your conditioned air distribution system, calibrating your thermostats and sensors (because inaccuracies can cost energy), and performing periodic maintenance of all building systems including regular boiler tune-ups and filter changes, cleaning heating and condenser coils, and window and light fixtures.

Turn it down would include night setbacks to ensure lighting and HVAC shutdown during unoccupied periods, and reducing heating and cooling temperature controls (for example heating to 68-70 degrees F, and cooling to 74-76 degrees F).

Turn it off would include shutting down office equipment when not in use (e.g., computers, printers, monitors, coffee makers should all be turned off overnight and on weekends). Occupancy sensors, time clocks and automatic controls can easily accomplish this.

And finally, Track it would involve monitoring and recording daily energy use by category, comparing it to regional or national energy use benchmarks for similar buildings, and finally, making sure that an energy conservation ethic is maintained over time.

If you follow these simple four T's, you will get the greatest bang for your buck. All of these steps can be done relatively quickly and have an excellent ROI.