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“One Thing at a Time” is the Wrong Approach to Energy Upgrades

Energy costs are on the rise. That means that now, more than ever, investing in a building’s energy management promises to deliver substantial returns. Not only can it save money for building owners but it allows operators to mitigate financial risk over a facility’s lifetime. For those looking to reap the rewards of energy upgrades, externalities are aligning: attracted by the appeal of net-zero emissions initiatives and large-scale reductions in energy consumption, governments are introducing incentives that partially offset the cost of retrofits.

The question for many, then, isn’t when to start but how to get started. The popular approach is to pay for an energy audit or benchmark. This means picking a particular system (heat!) or component (insulation!), figuring out how much you’re willing to spend, and then jumping into the upgrade. The energy consultants get paid, the suppliers and installers get paid, you get a lower energy bill, plus you get some money back from the government. Everyone wins, so this must be the correct approach…right?

Let’s play things out a bit more: that first upgrade was so successful that you want to do another. Those old incandescent lights are practically antiques now, so you swap them out for some ultra-efficient LEDs. Sure enough, your average annual energy bill goes down—but not as much as you’d hoped. After looking closely you’re surprised to see that your heating bill actually went up.

What the heck happened?

You’ve run head-on into a stark reality: a building’s annual energy consumption is determined by multiple systems interacting in complex and interdependent ways. Any “this thing, then that thing” approach is ultimately doomed to suffer from diminishing, disappointingly low (and potentially even negative) returns.

As the classic saying goes, you brought simple addition and subtraction to a multidimensional optimization fight (okay, I made that up but you get what I mean). The net effect over time is that your returns aren’t nearly as good as they could be.

According to the United States Department of Energy, the top six uses of energy within buildings are heating (20.8 percent), lighting (11.3 percent), cooling (10.0 percent), water heating (9.2 percent), refrigeration (6.6 percent), and ventilation (4.2 percent). Excluding refrigeration, which is generally outside the scope of a building’s efficiency upgrades, these account for 55.4 percent of energy usage—hinting at potentially huge savings. But the relationships between these systems are extraordinarily rich and complex. Changing one impacts the others, in ways that are challenging to predict without tremendous computation (thermodynamics is not known as a simple field).

Complicating matters further, these relationships change with the seasons and with demands placed upon them by the building’s tenants. They also change from place-to-place within a building and over time (because buildings don’t stay pristine and perfect).

Now, there are three major reasons why building owners take the one-upgrade-at-a-time approach. First, it’s familiar. Second, it’s simple. And last, but certainly not least, it doesn’t require as much up-front investment. To each of these I rebut that familiarity doesn’t mean correct, simple doesn’t mean optimal, and the focus should be on lifetime returns rather than one-time investment.

A fourth reason is that people don’t know that there’s a vastly superior alternative: applying Building Information Modeling (or BIM) to effectively model energy use. This method employs simulation and experimentation in a virtual replica of the building under study, accounting for the complex relationships between different energy systems and creating an instruction manual for optimized returns. Unlike alternative approaches that rely on guesswork and hopeful averages, BIM-based energy modeling generates precise, flexible, and adaptable solutions. Each model is completely customized to each and every building and can be tested and proven before making any investment decisions. Thinking of an upgrade? Test it out in the simulation to calculate the returns! You know what they say, “model twice, upgrade once.” (Okay, I made that up again but you get the point.)

As a bonus, once the BIM is created, it can be leveraged to explore renovations, to equip designers and architectures with true-to-life representations, to create a digital twin, to generate models used for promotional activities (e.g., renderings, virtual walkthroughs, etc.)—and much, much more.

As the new tool for energy modeling BIM is hindered by potential misconceptions and a lack of familiarity. For example, owners who lack a preexisting BIM can be quick to dismiss this approach, but technological advances (particularly terrestrial LiDAR scanning) have unlocked the power and potential of BIM for the built world. New solutions are even able to create onsite BIM models in a matter of hours.

A secondary concern for many building owners and operators around BIM is price. But the reality is that BIM-based energy modeling typically costs less than energy audits and has the added (and enormous) benefit that the BIM itself lives on while the audit gets stale as it gathers dust.

Building owners have the motive and the opportunity to invest in upgrades that improve energy efficiency. The effectiveness of these upgrades and the lifetime ROI are enormously dependent upon the approach employed. Fortunately, the industry is advancing beyond the age of physical documents, manual data entry, and simplistic analysis, and into a world in which building information modeling is readily available, affordable, and cost-effective. Obviously, you are welcome to take whatever approach you like when it comes to making energy upgrades. But if you’re looking to optimize your investments and maximize your returns (and get a shiny new as-built BIM as a bonus!) then there’s really only one choice. You know what they say: a model is worth a thousand data points.

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