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Part 1: Reducing Energy Use: Five Steps Help Overcome Barriers
By Jake Hiller and Chris Riso
April 2013 -
Saving money by saving energy is more of an art than a science. It is about understanding how decisions are made in organizations and how resources are allocated. A roadmap for facility managers looking to optimize energy performance, called "The Virtuous Cycle of Organizational Energy Efficiency," was recently published by Environmental Defense Fund and MIT. It is a model of change proven to apply across even radically different organizations. It includes five powerful, interdependent components.
The United States spends more than $108 billion on energy for commercial buildings each year, according to the Commercial Buildings Energy Consumption Survey (CBECS). It doesn't have to be that much, as it is increasingly possible to have a big impact without spending much money to reduce energy use. However, optimizing a building's energy performance takes time — something not typically in surplus for facility managers.
The fact is, organizations face many barriers to implementing energy-saving projects, which have nothing to do with technology and everything to do with the way people make decisions.
The components of the virtuous cycle model affect one another for better or worse. When the performance of one component improves, the performance of other components is made more likely to improve in a virtuous cycle of positive feedback. Conversely, if the performance of one component worsens, this can negatively impact the performance of other components through a vicious cycle of negative feedback. In an optimized organization, all components function at full capacity, and the virtuous cycle runs smoothly to improve energy performance, generating maximum financial and environmental returns.
1. Executive Engagement. Top-level executives recognize energy efficiency as a key strategic priority for generating cost savings and building long-term value. They shift from seeing energy as an inevitable and growing cost, and instead see its optimization as a source of continuous leverage for building an efficient and resilient organization capable of meeting its broader mission and goals.
2. Resource Investment. To empower an organization to capture energy savings, executives make strategic, capacity-building investments to free up the necessary human and financial resources to make concrete action possible. Energy efficiency projects will pay for themselves, but they need dedicated seed capital to get started and attentive managers to ensure those seed funds grow and are reinvested on an ongoing basis.
3. People. Resources are deployed to build staff capabilities and equip them to go after efficiency opportunities. Providing training opportunities, organizing cross-functional teams, and establishing full-time positions all help to build employee knowledge, foster enthusiasm, and create accountability for improvement. A workforce that feels ownership and responsibility for its energy use at all levels and is actively encouraged by leadership to work toward a shared vision of efficiency will maintain the momentum needed to make real progress.
4. Opportunity Identification, Implementation, and Measurement & Verification. To aid the organization's staff, effective processes and tools should be developed and refined over time to make sure increasingly ambitious projects are identified and implemented. Comprehensive and detailed energy data collection is vital to identifying sources of inefficiency and measuring the energy savings achieved through specific interventions — generating the verified financial and environment results that prove the benefits of taking action in the first place.
5. Stories and Sharing. To maintain momentum beyond a first round of projects, successful results are leveraged into stories that are shared directly back with top-level executives, validating their prioritization of energy efficiency as a key strategy and proving the business case for doing additional energy projects. By re-engaging the executives continuously, success stories keep energy performance at the top of the agenda and encourage the investment of additional human and financial resources to go after even bigger wins, keeping the virtuous cycle spinning for yet another round.
Energy: 5 Steps Help FMs Reduce Energy Use
Part 2: Shorenstein Properties Works Toward Comprehensive Energy Management Practices
Part 3: Shorenstein Energy Plan Shows Value Of Focusing On How Business Decisions Are Made