Pushing Energy-Efficiency Retrofits Closer to the Tipping Point

By: Michael Bendewald

It is not often these days that a public initiative, mired as many governments are in partisan and fiscal gridlock, holds promise to create a positive tipping point.

President Obama’s call for $4 billion worth of deep retrofit work resulting in energy-efficient buildings, half in the private sector, could be such a step.

This commitment, which will be paid for by energy savings at no cost to the federal government, will accelerate growth of the energy retrofit industry with better processes and skill sets, making building retrofits more cost effective. And, the benefits of making buildings more energy efficient extend far beyond the energy cost savings. Buildings use 42 percent of the nation’s energy—much of which is wasted. By aggressively adopting efficiency solutions, we can transform our buildings from energy hogs to more comfortable, liveable and workable spaces that can help usher in an efficient and renewable energy era.

Admittedly, the task is daunting. America’s 120 million buildings are staggeringly diverse, and upgrades can be done only one building at a time. Huge barriers stand in the way, from regulatory rules that penalize utilities for making buildings more efficient to an overall lack of awareness of the many benefits of energy efficiency among building owners and occupants.

But we’re not starting from scratch. There’s already good headway in making existing buildings more efficient in both the public and private sectors, with clear and measurable benefits to our economy and job creation.

Proving the economic case and creating jobs: Empire State Building

The hugely successful Empire State Building retrofit—a joint effort between the Clinton Global Initiative, Jones Lang LaSalle, Johnson Controls and Rocky Mountain Institute—led to $4.4 million in annual savings and a three-year payback. This project not only serves as an example of the economics of efficiency, it shows how retrofit projects can create jobs (Newsweek breaks down the 252 jobs created by the project) and attract and retain building tenants.

Stimulating the Economy through Government Buildings: Byron Rogers

A retrofit of the Byron Rogers Federal Building in Denver is expected to make the building one of the most energy-efficient office buildings in the nation—resulting in a projected 61 percent reduction from existing energy use from efficiency alone. To ensure that successes from this project could be replicated in future retrofits, RMI recently advised the U.S. General Services Administration on a Net Zero Renovation Challenge. The challenge will help energy service companies develop skill sets for energy retrofits that lead to deeper cost savings. Demonstrating these skills will allow them to change their business models and create a competitive advantage.

Reaching the Tipping Point

These projects are by no means outliers. Commercially valued rating systems such as LEED (total square feet of existing LEED-certified building space exceeded the square feet of LEED new construction this month) and ENERGY STAR—which helped deliver net energy savings of $17 billion in 2009 alone—continue to gain momentum, and grow the market for efficiency technologies and services.

Also, a new report from Better Bricks and New Buildings Institute demonstrates retrofits can achieve far beyond the 20 percent energy savings by 2020 sought by Obama’s initiative. This report analyzes 50 recent deep energy retrofits that achieved 30–80 percent energy cost savings. In each case, integrative design was more critical to project success than any particular technology.

Now, the challenge is to dramatically accelerate these nascent trends, and take deep retrofits to scale. That will take both a leap in awareness of the potential for efficiency gains and leadership from energy service companies, building owners, regulators, politicians and consumers. These players might be motivated for many reasons, ranging from dollar savings and job creation to energy security and public health.

I was recently reminded, in an e-mail conversation with my college philosophy professor, that accomplishing the important results of this work transcends personal ideology or motivation. Our discussion was about RMI’s new book, Reinventing Fire, which maps pathways for running a 158 percent-bigger U.S. economy in 2050 with no oil, no coal, and no nuclear energy. My friend liked our vision, but expressed qualms about our focus on America being first in the clean energy race.

In the end, we agreed that finding ways to motivate powerful potential drivers of change, such as business leaders, was key to achieving the bigger vision. “Sometimes accomplishing something may be more important than whether it fits my ideological framework,” my professor said.

Retrofits are a key part of that progress. The techniques, partly with Rocky Mountain Institute’s help, are being refined. If Obama's initiative helps them become widespread, we will have made strides toward enabling the needed energy infrastructure of the 21st century.

image: Reto Fetz via Flickr cc