Munich RE Meets Carbon Reduction Goals

By Naomi Millán, Senior Editor  
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When the mandate came down for significant carbon reductions from their parent company, Munich Re, in Germany, Paul Lupica, head of facilities and vice president of Munich Reinsurance America, Inc., says the first thought was, "Ok, how are we going to do that?"

Munich Re had topped Newsweek's environmental performance assessment of the largest publicly-traded companies in the world. In Germany, they had gone carbon neutral in 2009. It was decided that their global operations would follow suit.

Munich Reinsurance America's home office in Plainsboro, N.J., covers more than 400,000 square feet on a four-building campus. Around 25 years old, the buildings run strictly on electricity. Because three of the four buildings were constructed as spec buildings, Lupica says, energy efficiency wasn't high on the developer's priorities. "Energy conservation was not a consideration when these buildings were built," Lupica says. "We found we were bleeding energy in certain areas." A baseline Energy Star survey revealed the most energy efficient of the four buildings scored a 29, and the least efficient a 2.

In a way, such scores were a blessing. Munich Reinsurance America had to achieve a 10 percent per employee reduction in carbon footprint from a baseline of 2009 by 2015, but was prohibited by the parent company from just buying offsets to achieve the reduction. The challenge from their parent company gave Munich Reinsurance America focus, a clear direction and a timeline, says Lupica.

Starting with an average annual electrical usage for the campus of 16 MWh/year in 2007, Lupica's team has managed to squeeze down consumption to 9.5 MWh/year in 2011, with a solar canopy project to come online shortly that will slash another 3.1 MWh off of their annual purchase of electricity from the grid, he says.

One boon to the initiative was that many systems were already on the books for planned upgrades due to end of useful life, so meeting the mandate did not require an unanticipated capital outlay. Instead of replacing systems in kind, the most energy efficient choice that made sense for the application was selected, thereby whittling away at the carbon reduction goal.

Projects that would garner the greatest electrical savings were identified, including lighting upgrades, installing a lighting controls system, a new building automation system (BAS), a chiller plant replacement in one building and variable frequency drive installations throughout the campus.

With the help of an energy consultant, Munich Reinsurance America pursued any available public funding to make sure the ROI would be as robust as possible. For example, installing the BAS, the lighting retrofit and replacing the chiller plant cost $4 million. After a Board of Public Utilities rebate, the out of pocket dropped to $2.6 million, and the upgrades are saving about $1 million annually.

"With a cocktail napkin ROI, that's a 2.5-year payback," Lupica says. "Why wouldn't you do that?"

The Plainsboro offices have already met the 2015 carbon reduction goals, actually pushing past to a 12 percent internal reduction target per employee to help account for other locations in leased facilities that will have a harder time reaching the public target. Now, the Energy Star score for the most efficient building has been raised to 86 and the least energy efficient is 46. Lupica anticipates all four buildings will be Energy Star rated — meaning that their scores will be at least 75 — in the next few years.

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  posted on 8/3/2012   Article Use Policy

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