Expanding Our View of Energy Efficiency: from Single Measures to Whole Buildings

Ever since I entered the energy efficiency industry 27 years ago, the currency of energy efficiency in buildings has been the energy efficiency measure (aka energy conservation measure, energy efficiency opportunity, energy saving opportunity). As a result, the structure of our industry, from energy audits, to incentive programs and policy, is set up to look at one energy-saving idea at a time.

Right now however, there are a number of policy and market factors afoot that support an alternative currency which values an approach to whole building energy savings, instead of individual measure savings. I see the value in utilizing a whole-building approach and here’s why I believe we’ll see its adoption increase throughout this year and beyond:

  1. Climate change won’t wait! We need bigger, scalable impacts.
  2. Deeper impacts are possible when we use multiple approaches (e.g. retrofit and behavioral)
  3. California legislation promotes savings at the meter
  4. Meters are (mostly) ready
  5. Analytic tools are ready
  6. Customers get it!
  7. Whole building approaches help avoid stranded savings

1.  Climate change won’t wait! We need bigger, scalable impacts

We simply need much greater scale of what we do in energy efficiency. Climate change isn’t going to wait for us to count every kWh and therm saved through single energy efficiency measures. We need a deeper, more comprehensive impact on more buildings, which need to be done quickly and cost-effectively. California and New York, for example, spend a lot of time and money on energy efficiency programs. In turn we, as engineers, spend a large fraction of that time and money quantifying every savings impact on a measure by measure basis (and accounting for the impact of building codes).

As an engineer I find developing energy models and custom analysis fun and interesting (my twitter handle isn’t @energy_geek for nothing!) but is all this costly analysis really saving the most energy? Is it an efficient use of ratepayer funds? It’s easy to be frustrated by how much of our engineering talent is spent on quantifying measure savings instead of ensuring measures are installed and commissioned so that savings are actually delivered to our customers and our planet. A whole-building approach that focuses on deep savings seen at the meter and on the bill, coupled with an evaluation infrastructure that acts on a program level, not a building level, is a more efficient way to make a bigger impact with fewer resources.

2.  Deeper impacts are possible when we use multiple approaches

Our focus on the measure-by-measure approach impedes progress towards deep energy retrofits. Why? Because current incentive program structures require careful attribution at the measure level. Our program design, implementation, and evaluation approaches focus on attribution of individual measures. This approach makes it impossible to attribute savings through multiple, simultaneous approaches. For example, under current program structures I can’t measure the whole-building impact of a behavioral program if I’m doing a retrofit at the same time. If I tried to attribute each kWh saved in the building, it would be difficult or impossible to differentiate the source of savings between the two without doing a lot of expensive engineering work creating detailed what-if scenarios and engineering models to estimate the retrofit savings before I can net out the behavioral savings. None of this work actually contributes to achieving energy savings! We should be spending our effort on contribution to savings, not attribution of savings.

Of course there are some situations where a whole building approach is not well-suited. Once you’ve chosen the whole-building as your area of interest, you lose the measure-by-measure M&V of savings. In the complicated world of utility incentive programs, it’s difficult to break out other factors such as what savings were achieved meeting current codes and savings above code. The question that we have to ask ourselves is: isn’t it more cost-effective to quantify those factors on a program-wide basis, rather than confusing the customer with attributions that don’t make sense to them?

So the system intended to reward program administrators for delivering energy savings and market transformation is actually inhibiting progress because of its narrow focus. A whole building approach has the potential to broaden the focus from measures to the building and its utility bills – where the savings really count. It does this by focusing on the observed results. This way we can spend a lot more time achieving savings, through more detailed specifications and commissioning, and spend less time on calculations of what-if scenarios. Of course we still need rough savings estimates upfront to guide our clients, but it would save an enormous amount of time and cost not by not accounting for multiple baselines and what-if scenarios.

3.  California legislation promotes savings at the meter

Getting to the bottom-line energy savings is exactly what the California legislature seemed to be after when it passed AB 802 in 2015. The bill will provide owners of large commercial buildings with greater access to energy data and also directs the PUC to determine how to incorporate meter-based performance into goal setting, cost-effectiveness, and budgets for energy efficiency. This bill has already had an impact on the programs and projects that utilities are proposing, and one of the favored approaches is the whole-building one.

4.  Meters are (mostly) ready

Smart meters are rolling out across the country, making access to hourly metered data easier and easier to find and use. This trend will only continue as we’re already way up the adoption curve and momentum is building to increased data access. In California, IOU’s are required to provide downloadable Green Button data to their customers and I expect other states to follow in terms of accessibility to high-resolution data.

5.  Analytic tools are ready

Analytic tools are also now “ripe” for use on whole-building projects. The past several years have seen a proliferation of software tools that use whole building interval data. Many of these are simple data visualization tools that help you sort through time series data so that you (or the software) can spot diagnostic issues. While that approach is powerful, only a subset of those tools actually allow you to perform measurement and verification (M&V) on that data.

For buildings that have regular operation, we can pretty quickly develop a modeled baseline for the building. And if the software is any good it will also tell us how good the fit is, and what kind of error bounds to put on the results. So we can quickly and easily determine if the whole building approach is likely to work on the building, and the proposed retrofits. If the error bounds are suitable for the size of savings anticipated – we’re set. If not, we know.

6.   Customers get it!

Savings compared to existing energy use is simple and part of the appeal of the whole building approach is its simplicity. Customers understand the approach instantly and the savings make sense to them. Really this is what they’ve wanted and expected for years.

7.   Whole building approaches help avoid stranded savings

Looking at a building as a whole may increase a customer’s interest in performing deep retrofits when offering projects that combine measures with short and long-paybacks. Our traditional way of presenting projects to customers is to offer them a “menu” of measures – a list of projects to choose from, some highly cost effective, some with long paybacks (ok Mark Jewell I hear you cringe at the use of payback, I know it’s a poor metric but it’s a shorthand that everyone uses). If customers are presented with detailed lists of individual measures, guess what? They pick the short-payback lighting controls projects and leave the boiler replacements, chiller replacements, and envelope upgrades behind. Who can blame them? So after they’ve done the short-payback projects, how do you sell them the longer payback ones? It’s hard because the economics won’t carry the day, and so those other projects may be stranded, or left undone. However, if you had packaged the short and long-paybacks into one, big cost effective project with a 7 year payback and given them a financing path – maybe they would have done it (that’s what the solar folks do in essence).

In a Nutshell – Data is Important & Simplicity is Important

I think the time for making better use of whole building energy analysis has come. I believe it will greatly expand in the next two years and beyond. We’re already seeing it in California through pilot programs such as the Commercial Whole Building demonstration that PG&E has tested over the last two years. As Leo Carrillo, PG&E’s program manager puts it, “Data is important & simplicity is important” which says it all in a nutshell. The customer gets it because it’s simple; the data is available; the software and analytical approaches are maturing, legislation supports it and there is high value for the relatively low metering expense. Those are all the signs that this is the right time to accept a new currency in the energy efficiency industry: a whole building approach.


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