Measure it to manage it
The measurement of building energy performance is not simply about keeping track of your utility expenditure. Buildings are an important financial asset. If you want to ensure good return on investment, careful monitoring and control are essential.
In the world of property portfolio management, the numbers are always big. Prudential Property Investment Managers (PRUPIM) manages 740 properties worldwide; the real estate investment portfolios it manages range from £41 million to over £6 billion; these buildings have thousands of occupiers around the world.
Keeping control of how these properties perform is central to the role of portfolio managers. In a world where markets are constantly shifting, property is viewed as a relatively stable investment. Hence the performance of individual buildings is an important focus. How much energy they use, how quickly they can be let or sold, whether they meet current and future legislation on carbon emissions – these are the questions that require reliable answers.
The building energy management system is therefore viewed as an increasingly important source of business information. Energy efficient and sustainable buildings are now very much in demand. The main driver to this is the growing interest in ‘green’ investment funds and the understanding that sustainable buildings are a better financial bet in the long term.
In a study by Maastricht University (The Economics of Green Building, 2011) research into 26,000 office buildings in New York showed that sustainable and energy efficient buildings saw higher rents, better occupancy rates and increased selling prices compared to ‘non-sustainable’ but comparable offices. Investors are also showing greater interest in ‘green’ funds.
But this interest in more sustainable and energy efficient commercial buildings is not based entirely on the drive to better corporate social responsibility. The fact is, there are some hard financial reasons to ensure that buildings operate as efficiently as possible. In the UK, the CRC Energy Efficiency scheme is already providing an important incentive to track and manage energy use.
The government backed away from its proposal to introduce compulsory Display Energy Certificates for commercial buildings, but is making moves to place a greater tax burden on buildings with an F or G Energy Performance Certificate (EPC) rating. And there can be little doubt that rising energy costs will impact on ROI if not controlled. If tenants are paying more for electricity, they have less to spend on rent.
Understanding performance at a portfolio- and single building-level is seen in
a proliferation of energy efficiency and benchmarking schemes available to property owners and managers. These schemes allow portfolio managers to view how they are performing against competitors in the sector, and to demonstrate success to their shareholders.
The benchmarking schemes require regular and accurate collection of building energy performance data, most effectively achieved through the BEMS. For example, the London Better Buildings Partnership (LBBP) is a collaboration of London commercial property owners and related organisations.
The LBBP acknowledges that accurate measurement and monitoring of how much energy a building uses is crucial, stating: “One of the biggest barriers to improving the energy efficiency of commercial buildings is a lack of performance data. Both owners and occupiers are often unaware of how well or badly their building is performing…”
Ian Ellis, marketing manager of Siemens Building Technologies UK and President of the BCIA agrees that data is crucial: “It is important to think about the information that you require from a BEMS right from the early stages of specifying a system. Data for its own sake can lead to overload, so don’t simply collect everything. For example, it is possible to track minute-by-minute energy use, but you have to ask yourself if you really need that level of detail.
“Consider what data to collect, and how you are going to analyse it. Analysis is the key to understanding how the building is performing and why.”
Another significant group focused on reducing carbon emissions from the commercial building stock is CarbonBuzz, a free platform that collects anonymous building energy consumption data. This information has highlighted the gap between design intentions and the reality of building performance in energy terms. The RIBA and CIBSE are the key partners in CarbonBuzz, and the group includes a number of consulting engineers and architects.
CarbonBuzz enables property owners, occupiers and designers upload projects and compare data anonymously across organisations. The system has collected data on buildings in a wide range of sectors including education, offices, retail, health, hospitality and leisure.
Tracking the success of energy efficiency strategies is another important use for the BEMS. A before-and-after analysis not only demonstrates success, it also acts as the basis for justifying further investment in energy efficiency technologies or programmes.
At a recent BRE conference 1, PRUPIM’s director of sustainability Nina Jackson, made the very fundamental point that: “We can’t manage what we can’t measure.” When the giants of property management have seen the importance of good building performance data, it is a lesson that all building managers should take to heart. Your BEMS as a business tool that can provide hard data on building performance and help to manage and improve it in the future.
1. BRE 40% Symposium, November 2011.
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