If you don’t already know, most commercial buildings are unbridled energy hogs. The traditional glitzy, nighttime picture of a Manhattan skyline, or that of any other large city, comes with a big price tag.
Some cities are attempting to reign in such wastes on the commercial building front, including San Francisco. This week, the Land Use Committee voted to send the ordinance to the San Francisco Board of Supervisors, believing the “Existing Commercial Buildings Energy Performance Ordinance” is a way to transform the city’s commercial buildings from enormous energy users into energy savers. The first reading of the ordinance is scheduled for February 1.
At least a half-dozen cities and states have enacted policy similar to what San Francisco is proposing and more are considering similar steps. Green Building Elements is posting a three-part series on the issue of energy management for commercial buildings.
Steven Ring, Director of Client Solutions at Cushman & Wakefield and co-chair of the Mayor’s Task Force on Existing Commercial Buildings, points out that energy is the one expense that property owners and managers have the most control over. “But you can’t manage what you don’t measure. This ordinance – which is the result of a great working partnership between commercial property interests and local government – will help owners evaluate and improve their buildings’ energy performance, take advantage of financial incentives and rebates for making energy-saving upgrades to buildings, and in the process save money and create good local jobs.
Energy is one of the biggest expenses of building ownership, a burden that will grow in the future as energy prices escalate. It has been estimated that buildings account for about 70 percent of the electricity consumed in the United States. A September 2010 report from the U.S. Department of Energy and its National Renewable Energy Laboratory (NREL) concluded most buildings could be made up to 50 percent more energy efficient by practicing better energy use and using more efficient products and services.
According to the Institute for Market Transformation (IMT), commercial building rating and energy disclosure mandates already exist (see chart) in the states of Washington Washington State and Seattle and California, plus other cities, like New York City, Washington, DC, and Austin, TX.
Unlike the California law, building owners would be required to annually “benchmark” the energy use of their buildings and conduct building energy audits. Energy reports would be made available to buyers, lenders and the city. Initially, these rules would apply first to commercial properties larger than 50,000 square feet starting in October 2011. By 2013, the rules would apply to all commercial properties 10,000 square feet or larger.
Regarding the rationale for such action, IMT has written: “Commercial tenants and investors are increasingly looking for energy-efficient buildings with lower energy costs when they lease or buy. But all too often, information on building energy performance is unavailable, making it hard for the market to differentiate between efficient and inefficient properties. As a result, there is little demand for energy-efficient buildings and little competition between owners to improve building performance. The market forces that should be driving investment in building efficiency are absent.”
In the next part of this series, we visit San Francisco’s InterContinental Hotel, which is already managing energy use and seeing results.
San Francisco photo: Ivan Markarov