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3 steps to prioritize energy efficiency projects using benchmarking

April 19, 2017

By Susie McMullan

Energy managers often come to us looking for ways to reduce consumption by a sweeping 10% over their portfolio. Choosing a reduction goal is an easy way to quantify their success, and it’s often attainable if no previous efficiency measures have been implemented. Sometimes they factor in historical projects and consumption to decide on their reduction goal, but they often overlook an important factor of energy efficiency. I like to introduce this missing idea: instead of only comparing your facility’s energy use to its historical consumption, compare it to other similar facilities’ energy use.

This approach allows our clients to better focus their time on their biggest opportunities. The most inefficient buildings have a lot more to offer than 10% savings, whereas other buildings are already operating at their peak efficiencies. We recommend focusing your time by looking for the biggest opportunities on the most inefficient buildings relative to industry averages or a national benchmark.

Resources such as Energy Star, Benchmark My Building, and the DOE will help you benchmark your building. Benchmarking your building’s energy use helps make that energy use data relative to other facilities so you know what the maximum efficiencies are in a building.

For example, if you have a $550,000 annual energy bill for a 140k sq. ft. office building in New York, then next year a $500,000 bill wouldn’t seem too bad. In fact, in this case you would have nearly reached your 10% savings goal by shaving off $50,000/year on your energy bill. But what if you benchmark your building’s energy use and find out that most office buildings in your region operate at $2/sqft and your facility is operating at $3.90/sqft? This opens a whole new world of possibilities - you now have an achievable $270,000/year in savings in energy costs.

When looking to implement efficiency projects in your buildings, there are three main things to consider:

  1. Focus your time by prioritizing buildings: When you have a portfolio of buildings, benchmarking helps you identify where to spend your time. Instead of squeezing out savings for your efficient buildings operating at $1.10/sqft, tackle the facilities that yield greater savings opportunities.
  2. Focus your time by prioritizing efforts per building: If you are responsible for a facility operating well below the industry’s average, knowing that helps you focus your time on preventive maintenance and employee engagement rather than facility retrofits.
  3. Quantify your savings opportunity to help obtain funds for efficiency projects: Often time, if you’ve identified your buildings’ savings potential, it allows you more leverage to fund large recommissioning and retrofit projects. As an energy engineer, the first thing I do going into a facility is divide each facility's annual $ and kBtu per square foot to tell me 1) what buildings to focus on, and 2) how much the project opportunity may be. For example, if I know a facility has an opportunity of $270,000/year in energy savings and I know my boss is comfortable with 2-3 year project paybacks or ROIs, then I’m going to look for projects up to $800,000 to achieve that savings. It helps me expand my investigation and go big.

Our clients have many tricks up their sleeves to save energy and money, but it all begins with knowing which facilities have the largest savings opportunities. The best way to identify your savings opportunities is to benchmark your energy use and cost - not just using historical comparisons, but also peer comparisons.

Susie McMullan

Susie, a Senior Project Manager, is one of Lucid’s resident energy czars with a background in chemical and mechanical engineering. Prior to working at Lucid she founded TritonAMI, a technology, engineering and consulting company that helps water, gas and electric utilities manage complex data and operate more efficiently.