Energy efficient buildings could require data to attract investment

October 12, 2012

While the U.S. economy continues to move slowly forward in terms of job creation and investment in innovative technology, companies are also considering energy consumption and the move toward efficient buildings.

Initiatives such as the Energy Efficient Buildings Hub (EEB Hub), an alliance of academia and the private sector sponsored by the Department of Energy, are encouraging the commercial real estate sector to actively seek out opportunities to improve their energy performances. Investors are also looking to make the most of the latest innovations, but lenders are still approaching the market with a cautious rather than aggressive stance.

According to Greentech Media, at a recent conference sponsored by the Environmental Defense Fund, attendees were invited to review the Investor Confidence Project (ICP). In the same way that a mortgage company will require guarantees that a homeowner will repay a loan, investors in energy efficient building technology need to see data that will back up the effectiveness of energy savings undertaken.

The demand for reliable data has produced the Energy Efficiency Performance Protocol (EEPP), which is a standard means of assessing the energy performance of a company or commercial realtor that is looking for investment. Comprehensive building analysis can provide the investor with answers to questions, while building managers can undertake a varying degree of energy retrofits to allow maximum savings.

According to the EDF, the most comprehensive demonstration of energy efficient retrofits comes when a technician goes deep. The phrase "deep retrofit" was popular among politicians and energy vendors for a few years, with the challenge being that it was a difficult concept to apply to every building. The public perception was a commercial property that had undergone the deep retrofit was a "smart building," filled with energy saving technology and controlled by a computer system that made decisions on behalf of the occupants.

However, for most technicians, the depth of a retrofit isn't so much about the technology but the reduction in energy use by consumers, with data suggesting that savings of 50 to 75 percent is a good barometer. This data is crucial for investors, with different projects requiring various levels of investment.

This is where the EEPP could be a useful tool for lenders. By using a dedicated data analysis system, investment could be channeled to fall within the remit of organizations such as the EEB Hub while also acting as a catalyst for a global market for energy efficiency that has its roots firmly in American soil.