Sustainable within budget

28 October 2011

Mike Burke looks at the challenge of reducing energy efficiency within a building and meeting future low carbon requirements.

Energy management is now a key priority as facilities managers look to protect their buildings against the proposed energy price hikes, whilst meeting the ever more stringent legislation around carbon emissions. To do this, many are turning to specialists who are able to provide a practical, workable and financially attractive solution to their energy reduction requirements

This is certainly good for the environment and for businesses in these more cost conscious times. Addressing energy management issues can make good business sense as the latest optimised building energy solutions can avoid upfront costs, as well as providing an attractive return on investment. In simple terms, this means it is possible to bring a building up to modern thermal performance standards, with a return on investment possible within 24 months.

This is welcome news, as it is existing building stock that accounts for the greater proportion of Carbon Dioxide emissions and therefore it is hardly surprising that focus is now turning to this area.

Driven by legislation
Existing buildings operated by large public and private organisations will have to comply with the requirements of the Government’s Carbon Reduction Commitment (CRC) Energy Efficiency Scheme – the UK's first mandatory carbon trading scheme. This scheme aims to improve energy efficiency and cut emissions in large public and private sector organisations. It will affect approximately 5000 organisations and in doing so, is expected to cover 25% of the total business sector emissions within the UK.

Businesses that will be affected by the CRC, especially those within existing buildings, are looking to implement effective energy management programmes that will reduce the cost of CO2 allowances before the 2012 deadline. Those that don't will likely have to pay a considerably higher price for allowances to cover their emissions. Even organisations outside the current CRC remit are looking to reduce their carbon emissions, as legislation becomes ever tighter.

For the new build sector, ensuring a building is constructed in such a way that it is energy efficient and uses renewable technologies wherever possible, is being achieved through mandatory compliance with BREEAM requirements.
As a result of this more stringent legislation in the new build and refurbishment sector, we have seen more facility managers partnering with specialist M&E contractors who can provide them with practical, workable and financially attractive solutions to their energy reduction requirements.

When a refurbishment is planned, premises and facilities managers are looking ever more closely at the fabric of the building and the building services, as part of a focus on achieving greater energy efficiency.

With buildings now having to meet legislative targets in terms of energy saving - Display Energy Certificates (DEC) have for some time been a mandatory requirement of all public and private buildings when they are sold or leased - along with, for example, the CRC Scheme – are all encouraging facility managers to drive through energy efficiency measures.

Facility managers are finding that other decision makers in their business are viewing renewable technologies as an investment too and, with the right guidance, are choosing an optimised building energy solution, which can avoid upfront costs, as well as providing a return on investment of just a couple of years. In simple terms, this means it is possible to bring a building up to modern thermal performance standards that is making real savings and meeting the latest legislation, with a return on investment achievable within 24 months.

Minimise Optimise

Using the latest technology, we have developed an integrated set of energy saving products and services for facility managers. Crucially in these more austere times, this package of measures gives guaranteed reduced energy consumption, whilst providing a predictable and attractive return on investment, a unique concept for the industry and one that is being widely welcomed.

Implementing these measures to improve energy efficiency initially involves skilled M&E engineers conducting a survey of the building. This is done using existing smart meter monitoring systems, or creating a Thermal Profile of the building using Digital Thermal Modelling Software. Elements such as the building’s shape, form, orientation and openings are linked to the surrounding climate and its thermal, light and airflow properties. A detailed analysis is also carried out of other elements, such as use of space, occupancy levels, equipment usage and HVAC including renewable systems, which are also accounted for through calculations such as; heat loss, heat gain, daylight analysis, shading analysis and energy consumption. This enables the focus for the building to be on the energy-consuming assets and how these can be addressed.

Following completion of the survey, our team analyses, in detail, the building’s energy usage and the proposal begins to take shape. The survey determines the savings in energy and therefore cost, allowing the whole project to be assigned a return on investment (ROI), which is an essential requirement for all businesses to make sound investment decisions. Once this ROI is established, a way forward is proposed which identifies KPI’s supported by guarantees to deliver the stated savings.

Once agreement to proceed is reached, a detailed design document is produced that identifies energy saving products from our Minimise Optimise range to be replaced/installed, plus it includes any aesthetic changes that the client may require to the building, either as a result of the work, or requested as part of general improvements. At this stage, our project delivery team meets with the facilities manager to agree schedules and identify ways of minimising disruption. Working within an occupied building requires a different set of skills from operating within a new build or vacant property and our highly experienced installation team have the experience of operating within these environments and are flexible with their out-of-hours operations, which is essential on many projects. Often it is essential that the main functions of a building are kept fully operation during the refurbishment works, so a flexible approach is required to make this possible and ensure minimal impact to normal everyday activities.

Within most energy reviews these days, an element of renewable technology should be considered. Specific energy efficient measures include lighting control products that are capable of reducing energy costs by up to 80 per cent and LED lamps that will give the same Lumen output as a standard lamp, but use just 40% of the energy. Other measures include an innovative Sun Tracking control system for solar shades, which will help to reduce heat gain and the need for air conditioning, whilst controlling the amount of daylight entering the workspace. More recently, we have incorporated a Solar Photovoltaic (PV) solution, which allows clients to earn revenue and reduce running costs. IMOP (inductive motor optimisation panel) units are also becoming more widely used and these are an essential part of reducing reactive power requirements.

A fully optimised building energy solution involves the strategic installation of Smart Metering Systems throughout its infrastructure. This means premises and facilities managers can monitor the system and report back on how well the upgrades have performed against the plan – an essential part of ensuring the accuracy of the ROI calculation.

It is important to check that the energy efficient solution comes with a fully inclusive maintenance package for the ROI period stated in the proposal, which will ensure a supplier is accountable for the calculations within the initial plan. As part of our package, we carry out remote monitoring on all the projects that we install, providing regular reports to clients so that they can manage their energy usage over the years.

Investment not cost
When it comes to refurbishing an existing building or building new, the challenge is to balance the need to invest upfront in energy efficient systems against the long term benefits of doing so.

The issue is often the capital investment that is required, for example, for renewable systems this can be significantly higher than investing in a conventional energy system. Again, one of the issues is that a renewable system often falls outside the capital budget, which is why a self funding solution is important. Self funding solutions are becoming more popular, as it means clients don’t necessarily have to pay any upfront costs. Avoiding any large upfront investment makes energy efficient upgrades accessible to all sectors of the market and, indeed, is often viewed as a good business decision. In addition, we guarantee the savings, so if the client is looking for a 25% saving on their energy consumption and we state this is possible then we guarantee this for the period of the loan. This package of self funding we have developed is unique.

That is one of the reasons the industry needs to focus on ROI when it comes to an optimised building energy solution. Many facility managers still view renewable systems as a major capital investment that may never be fully recouped, which simply isn’t the case.

Latest optimised building energy solutions are leading the way in helping to cut carbon dioxide emission from the UK’s existing building stock – by far the largest contributors of greenhouses gases. As the Government’s targets for the energy efficiency of buildings become ever more stringent, facility managers are working with specialist M&E contractors to provide a practical, workable and financially attractive solution to their energy requirements. Many facility managers are seeing energy management as an investment in controlling future price increases. With paybacks guaranteed within two years, it is no surprise that this is now becoming increasingly attractive.

Example
Cost of equipment and installation = £350k, ROI is 18 months, 5% interest charged on capital so repay £367.5k, repaid over 24 months will cost £15.31k. Savings per month are £19.44k, realising immediate savings of £4.13k from installation in addition to repaying capital cost. After 24 months, the full monthly £19.44k saving will be realised, based on energy costs calculated at today’s rate, with energy increasing by at least 5% p.a. this would be a real saving of £21.4k per month = £256.8k p.a.

Mike Burke is Business Development Director at Unidata Infrastructure