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Commercial And Industrial Buildings Use Half Our Energy: Let's Get That Number Down

The Department of Energy has issued a challenge to corporations: You don’t have to believe in climate change, but why don’t we all try to save money by using less energy.

Efficiency is the non-controversial side of energy policy. While support for renewables (anyone say Solyndra?) generates a lot of heat and light (and not the useful kind) everyone can agree on the wisdom of doing more with less. Even Obama’s fiercest critics think it’s a good idea.

The Department of Energy’s Better Buildings Challenge is an example of a not particularly sexy program with the potential to pay off big. By encouraging organizations to rethink how facilities are managed, there’s an opportunity to save money, cut carbon, and reduce the need for new energy. Commercial and industrial buildings account for about 50% of all energy use, and for about 40% of CO2 emissions. If we could make savings in thousands of buildings across the economy, it could really make a difference.

The Challenge was launched in late 2011, as part of a goal of cutting the energy intensity of all buildings 20% by 2020. So far, 110 organizations (companies, schools, universities, governments, and so so) have signed up. And the results are encouraging.

On average, the partners have cut energy intensity—a measure of use per square foot, or how much energy is issued during an industrial process—by 2.5%. And, in some cases, the savings have been much greater than that. Of 7,700 facilities that have reported, 1,300 have cut consumption by more than 20%, and 2,100 have cut by at least 10%.

The partners include companies like InterContinental Hotels and real estate group Forest City, as well as public entities like Los Angeles Department of Water and Power and Michigan State University.

One of the main goals of the challenge is to establish examples that others can follow, and to create data proving that investments pay off if organizations make them. A lack of bankable evidence has been a major stumbling block to spreading efficiency projects more widely.

"When partners share enough detail they become living examples of why this works and how it works," says Maria Vargas, director of the program. "We’re the Department of Energy and we’re providing information, but when the partners do it, it gives people more confidence. It’s not because someone else told them to do it. It’s 'Kohl’s did it’, the 'City of Atlanta did it’, or '3M did it’."

Vargas says success stories also help make the case internally within organizations. Up to now, corporate America has been wary of investments that take longer than 18 months pay off, she says. The program can help demonstrate to finance departments that while payback periods are relatively long, they are worth the effort.

Now Vargas wants to bring greater transparency to energy data—for example, by encouraging more utilities to participate in the department’s Green Button program (allowing owners to download building data), and by championing city disclosure initiatives that mandate owners to buildings data public.

Cutting energy use by 20% across all buildings by 2020 will be a tall order, but not an impossible one, she says. "With the tools we’re providing and some of the examples the organizations are providing, it will help drive change."