For our latest edition of the Energy Efficiency Trends market report (published by EEVS Insight in partnership with Bloomberg New Energy Finance) we asked our community of energy users and suppliers of energy management products for their views on the next wave of innovation that will influence energy performance in buildings.
Halfway through the harvest
Our research has told us clearly that high efficiency lighting has been the ‘big thing’ for several years. Since it became viable to retrofit LEDs as a replacement for fluorescent fittings in around 2011, lighting upgrades have consistently been the most reported energy efficiency measure deployed by our survey respondents. A lighting upgrade is a clear case of ‘low hanging fruit’ – an easy-to-deploy turnkey project that will pay for itself from savings in a few years.
So we wanted to answer a simple question. After four years of this LED lighting boom, how far along the adoption curve are we? Or to put it another way, how much of this low hanging fruit has been harvested?
The answer appears to be ‘about half’. A little under half of energy users consider that the bulk of their estate has been upgraded to LEDs already. This means there are still many great opportunities for projects, but the population of buildings that will benefit from a transformational lighting upgrade is gradually diminishing.
So what’s next?
The bad news is that most energy efficiency projects are harder to implement than a lighting upgrade, being more dependent on controls and continuous optimisation, because the human beings that occupy our buildings tend to override, erode and otherwise interfere with even the best-laid energy efficiency plans.
But an increasing number of organisations need to work out how to do this if they are to keep decoupling energy use from growth, having already banked the savings from a lighting upgrade. The technology to achieve this – submetering, monitoring and targeting software – has been around for many years, but in our experience really successful implementations are rare. Many organisations struggle to control drift in energy use in operational buildings, let alone proactively seek out opportunities for savings and investable projects.
So we wanted to explore whether the much-vaunted ‘Internet of Things’ (IOT) might offer a solution. Could the promise of a building-wide cloud of cheap, ubiquitous sensors enable easy, granular control of energy on a new scale, giving us a smart, self-optimising built environment? Or does this just create stockpiles of data that cannot readily be converted into actionable performance information?
Our energy-using respondents are unanimous. They declare that IOT is going to transform energy management, and it is the most-cited ‘game changing’ technology by energy consumers.
The Internet of…. What?
Yet our community of suppliers of products and services are more ambivalent. They predict a number of possible technological frontiers including battery storage, demand response and on-site renewables driving the future of energy performance, their responses no doubt coloured by the solutions they themselves offer to the market.
But perhaps this also implies that IOT technical solutions and business models are not yet fully fledged. There are still few turnkey smart building products on the market, and no consensus yet on the precise advantages that a smart building offers. So we conclude, IOT is coming, but we don’t yet know what it will mean.
Back to basics
What we do know is that, if there are fewer technological ‘quick wins’ to be had, the building occupants on the ground need to share in the responsibility for delivering savings and sustaining performance. Our Trends reports have tracked the rise of professional engagement programmes focusing on energy efficient behaviours in the workplace. The most successful organisations in this field are instilling an awareness of energy performance at a cultural level, akin to the quality management or continuous improvement culture that has transformed manufacturing over recent decades.
But of course, in the modern workplace, often the people on the ground are not employees. Many organisations have outsourced their facilities management (FM), as well as maintenance, mechanical and electrical services. So do these contractors share the host organisation’s energy goals, and are they helping to drive efficiency in buildings? The survey data, which is freely available in Volume 17 of Trends – can be interpreted in various ways, but it appears to show that the more innovative organisations are harnessing their outsourcing contracts to enhance energy performance.
Most energy users say they are not using their FM contracts to deliver savings, either because they don’t outsource, or because energy services are not part of their FM contract. But a higher proportion of the energy users that are working with our community of energy services providers – by implication, those who are already managing energy proactively – do seem to be using their outsourced FM contracts to drive savings, indicating that the leading organisations are pouncing on the opportunity to work with facilities partners to optimise energy use.
Making it work
The idea of using FM relationships to deliver savings is not a new one, so what are these leading organisations doing to make this work? In our experience, these arrangements can only work with the right measurement systems in place, a clear alignment of objectives and a muscular governance and management process to ensure that claimed savings are actually being delivered in practice.
Successful partnerships may not arise where lowest-cost is the overwhelming procurement driver, as it so often is with facilities management. Instead the total cost of an FM contract that dramatically reduces energy spend needs to be taken into account, as well as the benefits of a more comfortable, better maintained working environment.
Of course, the IOT revolution may well be an enabling factor that opens up this market. But as always the challenge is not really in generating data, but in converting it to information in order to improve and manage performance.
So, somewhat prosaically, the ‘next big thing’ in energy efficiency might not be a new technology, but smarter contracting.
Alex Rathmell is founder of EEVS Insight.
Photograph: Flickr/ Huayuan Smart.