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Focus: Energy Efficiency

Making the case for energy efficiency

April 30, 2020

For commercial building owners and facility managers, financially compelling investments in energy projects continue to represent an undeniable and yet untapped opportunity — estimated to offer $290 billion in net present value across the US commercial building sector, according to an article from Building Operating Management on the FacilitiesNet website.

 The motivation is there: As evidence, look to the nearly half of all Fortune 500 companies that have set at least one clean energy or climate target. But several market barriers have made it difficult for the large majority of commercial building owners to capitalize on this opportunity —particularly portfolio owners, who stand to benefit the most.

 These market barriers have been well documented. For example, Johnson Controls’ latest survey of more than 1,200 energy and facility management executives found that the most common barriers relate to financial capacity and technical expertise: lack of funding, uncertainty about savings and performance, insufficient payback or return on investment, lack of technical expertise to evaluate or execute projects, and lack of awareness of opportunities.

But at the core of these market barriers is one primary, overarching challenge that’s hampering the decision-making ability of commercial portfolio owners. This challenge can best be summarized as a language barrier consisting of two parts:

• A communication gap. Most existing energy project evaluation approaches have an inherent bias toward energy savings, and fail to adequately consider project economics and generate the kinds of business metrics that decision makers need.

• Lost in translation. Analyses are often fragmented and the multiple stakeholders involved in evaluating and executing energy projects (from building engineers and facility managers to portfolio managers and CFOs) tend to speak different languages based on their respective skill sets and priorities, making a comprehensive understanding of opportunities much harder to achieve.  

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Topic Area: Energy Efficiency


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