What’s Next in Energy Benchmarking?

As more cities require commercial building owners to report energy consumption, what’s next for utilities benchmarking? A panel of experts tackled the issue on Thursday during the Institute of Real Estate Management’s Fall Leadership Conference in Orlando.

As more cities require commercial building owners to report energy consumption, what’s next for utilities benchmarking? A panel of experts tackled the issue on Thursday during the Institute of Real Estate Management’s Fall Leadership Conference in Orlando.

“These programs are going to continue to evolve, and as more cities adopt these policies, there are going to be a lot of lessons learned,” said the panel’s moderator, Nathalie Osborn of Chicago-based GreenPoint Partners L.L.C.

“Cities don’t know anything about the buildings that exist within them,” said Adam Sledd, program director for commercial real estate engagement at the Institute for Market Transformation, a Washington, D.C.-based non-profit group that promotes energy efficiency and sustainable building practices. Addressing an audience of real estate managers and other professionals, he added, “You’re the people who are faced with helping cities get their arms around it.”

A major challenge for property managers and other stakeholders is that utilities are behind in using technology to track energy performance of buildings. As a result, “The utilities are scrambling every time a benchmarking law is passed.”

Rather than waiting for lawmakers to impose benchmarking on them some forward-thinking industry groups are taking the initiative and proposing their own guidelines. As Sledd put it, “We want to lead the process.” As an example, he cited Chicago’s benchmarking rules, which were drafted by the local chapter of Building Owners and Managers (International) Association.

The U.S. Environmental Protection Agency’s latest version of the Energy Star program is boosting benchmarking efforts, said Danielle Horton, principal with Verdani Partners, a Carlsbad, Calif.-based consulting firm specializing in sustainability-related services. She cited the new provisions for sharing information when ownership or management changes.

Horton also said she looks forward to the day when it is standard practice for utilities to provide usage data directly to property managers. “If we could receive that directly from the utility bills . . . that would be so helpful.” For instance, that practice makes it easier to obtain usage data for net-leased properties whose utility bills are paid directly by tenants.

Other helpful tools include a U.S. Department of Energy program that permits energy efficiency evaluation, even when utility bills are unavailable, said Jonathan Payne, sustainability analyst at Liberty Property Trust. The Malvern, Pa.-based REIT was among the first major owners to start benchmarking a managed portfolio, an effort that encompassed 156 office and industrial buildings and 17 million square feet. That still left the rest of its 103 million-square-foot portfolio untouched, so Liberty asked Goby to provide additional analysis, Payne said.

Utility-sponsored incentives are changing because, Sledd said, “There are only so many light bulbs they can hand out.” For the next iteration of energy-efficiency initiatives, “They want to get more into building operations.” A major new category of tools will be software that permits remote energy audits.