The Retrofit Triangle!The Retrofit Triangle!Monetizing green building efficiency gains by linking

technology operations and financetechnology, operations and financeGreenbuild International Conference and Expo

Convening what comes next in the green building movement

Thursday, April 14, 2011

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The Retrofit TriangleD i l H t (O ti )

PANELISTS

Every successful energy/resource efficiency retrofit

Monetizing green building efficiency gains by linking technology, operations and finance

Daniele Horton (Operations)Sustainability ManagerThomas Properties Group

James Finlay (Finance) Every successful energy/resource efficiency retrofit involves an ongoing integration of three normally distinct and separate functions: operations, technology and finance. This three sided relationship

d it i f ti h f th R t fit

James Finlay (Finance)VP, Sr. Commercial Appraisal Manager, Wells Fargo

A i ddh D dh (T h l ) and its information exchange forms the Retrofit Triangle. An expert from each discipline will illustrate by examples the challenges and key elements needed to create this vital linkage. When set up

Aniruddha Deodhar (Technology)Sustainability Program Manager Autodesk

David Hodgins (Moderator) g pcorrectly, data flowing from the building’s energy/resource management operation can support financing to achieve ever higher levels of performance res lting in al e creation

g ( )Building Energy Efficiency Retrofit Program, Clinton Climate Initiative

Collaborators:Research: Genaro Bugarin performance resulting in value creation. Illustrations: Jonathan Smith

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Discussion Objectives:Discussion Objectives:1. Recognize the need for

integrating technology, operations and finance to spur retrofits

2. Learn what data is required to judge the investment risk and make finance availablemake finance available

3. Understand how implementing efficiency retrofit projects translates to investment value with social and environmental benefits

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Existing Building RetrofitsExisting Building RetrofitsRetrofits are a win-win solution to environmental and economic challenges

• 98-99% of the US building stock ismade up of structures that are alreadybuilt or near completionp

• Carbon emissions need to be cut 80% by 2050 and US Buildings are responsible for 40% of CO2 emissionsresponsible for 40% of CO2 emissions

• Nearly 75% of U.S. Commercial Buildings are 20+ yrs old and ready for a g y yRetrofit

• Building Retrofits Offer Lowest Cost, Highest PayoffHighest Payoff

• President Obama passed the “Better Buildings Initiative” to catalyze private‐sector investment through a series of incentives to make existing buildings more efficient.

The Retrofit Triangle!The Retrofit Triangle!• Monetizing green building efficiency gains by linking technology, operations and finance

• Breaking down the SILOS to monetize the benefits and spur green building retrofits• Breaking down the SILOS to monetize the benefits and spur green building retrofits

I . Operations - Investigate, Implement, Improve

III T h l

II . Finance - Assess, Access Capital, Appraise

III . Technology - Model, Measure, Manage

1. INVESTIGATE

2. IMPLEMENT

3. IMPROVE

OPERATIONSSection I

OPERATIONSDaniele HortonSustainability Manager

6

Sustainability ManagerThomas Properties Group

1. INVESTIGATE

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Building Operations last a lifetime!Building Operations last a lifetime!Applying integrative design principles to help managing and financing building retrofit projects during ongoing operations. p j g g g p

Design / Construction Operations (Life of Building)Design / Construction

O ti E t O G i P

30% - 40% 60% - 70% life cycle cost

One time EventCapital BudgetsFirst Cost

On-Going ProcessOperating BudgetsOngoing Costs

Integration for design solutions through Eco-Charrettes

Integration of financeand operations through technology!Eco Charrettes technology!

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Set Goals & Create TeamSet Goals & Create TeamApplying integrative project delivery (IPD) principles to help managing and financing building retrofit projects during ongoing operations

Gather DataGather Data The first step in the retrofit process is to gather data perform audits and link them

Level I ASHRAE Walk-through surveygather data, perform audits and link them to the technologies best suited to achieve a particular goal.

S S

Level II ASHRAE Detailed survey and energy analysis

Level III ASHRAE Detailed analysis of capital-intensiveSTEPS:

• Gather and track data• Establish baselines

capital intensive modifications (known as Investment grade audits)

• Benchmark• Analyze• Get technical assessments and audits.

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Build an Energy ModelBuild an Energy Model Soft Audit Process; good screening tool to identify Energy Efficiency Opportunities

Energy Modeling data is used to:

• Analyze retrofit options to achieve t t i ithi b d tgreatest energy savings within budget

• Achieve aggressive performance targets• Compare Model Results vs. Actual Data

(Utility Bills) to identify potential anomalies with energy consumption

• Assist in getting financing & rebates

• Select mutually exclusive investments

• Balance energy performance optimization Carbon footprint reductionoptimization, Carbon footprint reduction, energy savings and positive net present value

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Develop a BaselineDevelop a Baseline • Develop a baseline or “business as

usual” case to compare against theusual case to compare against the value of the efficiency savings and investments.

• Failure to recognize business-as-usual investments is a key barrier to energy efficiency.

• These capital investments become avoided future costs when efficiency i t t l th th finvestments replace them, therefore making the efficiency much more economical.

CNP Case Study I 2003/2010 Electrical Consumption61.6% Increase in occupancy with only a 1.3%

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p y yincrease in kwh consumption due to deep energy saving retrofits. Over $12M Savings since 2003

Identify OpportunitiesOften energy systems are original and retrofits can save 20%-50% in energy costs

Identify Opportunities

City National Plaza . Before and After retrofit photos

Sample Retrofit Opportunities

Sustainable Water Efficiency Energy & Materials & Indoor Air

Sample Retrofit Opportunities

Sustainable Sites

Water Efficiency Energy & Atmosphere

Materials & Resources

Indoor Air Quality

Restore open spaces Install metering devices & controls

Monitor , meter & commission main building systems

Perform a waste Stream Audit

Implement Indoor Air Quality BMP’s

Implement erosion control strategies

Perform ongoing Distribution system audits, leak detection and repair

Maximize heating and cooling efficiencies & Install variable frequency drives on equipment

Invest in trash compactors

Monitor Outdoor Air Delivery and increase natural Ventilation

Invest in alternativecommuting

Install native & drought resistant Landscape

Lighting upgrades and controls (Efficient lights, Daylight

Invest in recycling infrastructure:

Reduce Particulates in Air Distribution (Install g

transportation programsp ( g , y g

Harvesting, motion sensors etc. containers, loading dock collection areas

(high performance filters)

Install EV charging stations, bike racks, provide storage and

Maximize Indoor Plumbing Fixture and Fitting Efficiency (toilets, urinals, faucets,

Install a building automation system , invest in DDC, wireless controls, energy optimization

Infrastructure area to support recycling of construction waste

Install Carbon Dioxide (CO2) Monitors

showering facilities aerators and showerheads) software & demand response infrastructure

Light Pollution Reduction (Shield exterior lamps, install lighting controls for interior lighting)

Install efficient Irrigation systems: Drip Irrigation, Smart Irrigation Controls, Soil Sensors controls & Weather

Retrofit main building systems: chillers, cooling towers, boilers, fan motors

Purchase entranceway mats

for interior lighting) Sensors controls & Weather Stations

Heat Island Reduction (White roofs, light colored paving etc…)

Implement a Cooling Tower Chemical Management and water efficiency program

Building Envelop: Seal windows , install window films, retrofit windows with higher R-Value

Invest in green cleaning equipment & materials

Stormwater Management (Green roof, rain capture, etc…)

Invest in on-site generation and renewable Energy systems (Fuel Cell, Wind, Geothermal & Solar Energy)

Right steps in the right orderRight steps in the right orderStart with load reduction projects. There is no silver bullet! It’s ok to start in small steps as long as continuous improvement is made overtime.

There is no silver bullet! The goal is to continue to make progress and improvements over time…

p g p

OI

Meter & Load Fan and Plant

RO

Time and Capital Outlay

Meter &Tune up Lighting

LoadReductions Motor

SystemsUpgrades

Time and Capital Outlay

Source: BOMA BEEP (BOMA Energy Efficiency Program) 15

Analyze OptionsAnalyze OptionsUsing advanced technology tools and cost analysis methods to get insightful data to enable superior analysis and decisions.

Economic decision tree: • Evaluate Individual and Bundled

Measures

Using NPV to choose between mutually exclusive investments (sample analysis):

Measures • Perform a Gap Analysis • Use NPV to choose between

mutually exclusive investments.y• Create Pathway to Very Low

Energy/Net Zero • Tell a Compelling Story

Source: Energy Star Building Manual . Chapter 3 Investment Analysis: http://www.energystar.gov/ia/business/EPA_BUM_CH3_InvestAnalysis.pdf

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2. IMPLEMENT

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FinanceFinanceInnovative financing options exist to help with accessing capital with attractive rates and terms for deep energy retrofits

Key Financing Mechanisms

Purchasing Loans, Bonds

Lease Operating / Capital Leases

PerformanceContracting

ESCO financing

New Financing PACE, On-bill Financing, gOptions

, g,Energy Service Agreements (ESA)

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LeasesLeases Energy Aligned Leases are key for sharing the costs and benefits of green investments and address the split incentive dilemma that can hinder retrofits. Benefits to investors will be impacted by leases, holding periods, and the ability to have tenants pay for theand the ability to have tenants pay for the benefits they receive.

Lessons Learned: Sample Green Leasing Checklist for Landlords & Tenants to Discuss and Mutually Agree Upon:

• Address the split incentive barrier through Energy Aligned Leases*

• Incorporate green / energy aligned leasing provisions into your master lease to allow

y g p

Financial responsibility and ownership of benefits of green investments ENERGY STAR RatingLEED Certification

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provisions into your master lease to allow pass through costs as operating expenses

• Can work with most lease types and structures

LEED CertificationStrategies for reducing travel demand and car dependency Efficient water management Management of energy use and greenhouse gas emissions Purchase of Green Power

• Leases should counts savings over the length of a projected payback period, instead of the useful life of the improvements

Smart Metering Controllability of SystemsManagement of indoor environment quality Green Cleaning & maintenanceEfficient waste managementEfficient waste management Sustainable Purchasing PolicyWaste minimization and recyclingGreen TI Guidelines

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Contract Construct and CommissionContract, Construct and Commission Smart and integrated performance contract structures take advantage of rebates, incentives and innovative financing structures to fund retrofits.

Lessons Learned:

• Financing structures involving properties with debt / mortgages are more challengingmore challenging

• REITs have to go to revolving credit facilities or investors and therefore money spent on capital is money that o ey spe o cap a s o ey acan’t be distributed to investors. Using financing structures such as ESA & PACE means less debt on their b k d f d il bl fbooks… and more funds available for investors

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3. IMPROVE

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Measurement and Verification (M&V)Smart technologies and M&V tools assist with continuous buildings operations improvement so that you can do more with less

Measurement and Verification (M&V)

DRIVERS KEY FUNCTIONS MAIN TOOLS BENEFITS

Increasing energydemand

Gather Data Ongoing Metering& Smart Meters

Higher EnergyEfficiency

Increasing cost of power

Analyze Data Building Automation

Lower Operating and Maintenance Costs

Increasing economic pressures

Present data insimple and useful

Commissioning Better Indoor Air Qualityeconomic pressures

• Occupancy• Earnings • Capital

simple and useful ways

Quality

Increasing focus on f

Predictive, d ti d

WirelessS l ti

Greater Occupant C f tenergy performance

• Tenants• Government• Investors

adaptive and automated actions

Solutions,Direct Digital Controls

Comfort , Controllability and Productivity

Increasingly Accumulate Software Lower g ycomplex building management key performance indicators (KPI’s)

knowledge with feedback loop

Applications environmental impact

Increasingly limited Connect building Dashboards Increased NOI

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Increasingly limited building management resources

Connect building structure to the functions it exists to fulfill

Dashboards Increased NOI and property values

M&V: More Automation & VisibilityM&V: More Automation & VisibilityBetter technology, increased automation and higher performance drives building value

Technology Today• DDC I Wireless• Image capture + sensors

Typical Building• Pneumatic

Analog • Image capture + sensors• Intelligent Processing• Large memory• Programmable

• Analog• Manual gauges• High operations cost

Programmable

Manual Instrumentation, Not BLIND! VISIBLE!

Automation facilitatesProgrammable, No Diagnostics…Equals: Wasted Energy, Higher Downtime, More Labor Required 23

Automation facilitates superior management and performance

Share the Success!Share the Success!

Hard Value Soft Value

Business benefits are the main drivers for green building retrofits

Hard Value Soft Value 8.5% Reduction in operating costs Market differentiation

& reputation

6.8% Increase in building values Growing tenant demand

9.2% Increase in ROI Reduced obsolescence

6.4% Increased occupancy Lower energy cost risk

6.2% Increases in rent Increase in regulations

Investment Cost

$11MInvestment Cost

$13 2MC SDeep Retrofit Success Stories

Source: McGrall Hill, Green Outlook 2011: Green Trends Driving Growth

$11MAnnual energy savings

$4.3M

$13.2MAnnual energy savings

$4.4M

City National Plaza Empire State BuildingOffice OfficeLos Angeles, CA New York, NY

Energy Reduction

37.5%Energy Reduction

38%3.2 Million GSF 2 (51) Story Towers

2.8 Million GSF(102 Stories)

$11 M (Investment Cost) $13.2 M (Investment Cost)$ $

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$4.3 Million Annual Energy Savings

$4.4 Million Annual Energy Savings

37.5% Energy Reduction 38% Energy Reduction

Increased Building Performance TransparencyIncreased Building Performance TransparencyPerformance Ratings, standards and regulations for the Real Estate Industry

Entity Name ScopeUSGBC (2010) LEED Building Performance

PartnershipGlobal

Greenprint Foundation (2010)

Greenprint index Global( )

GRESB(2009)

Global Real Estate Sustainability Benchmark

Global

CDP CarbonDisclosure project

Global

UN-PRI (2009) SBCI Common Carbon Metric Global

ENERGY STAR (Prior to 2004)

Energy Star Portfolio Manager American

CR (2007) The Climate Registry American

BREEAM International Sustainability EuropeanBREEAM (2010)

International SustainabilityAlliance (ISA)

European

Green Rating Alliance (2010)

Green Rating European

IPD (2008) Eco Ledger European

California (2007) AB1103 Municipality

Better Building Partnership (2008)

Benchmarking Working Group Municipality

New York City(2011)

LL 84 Municipality

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(2011)

Operations Conclusions

• Advanced technology tools aid in

Operations Conclusions

• Advanced technology tools aid in gathering quality data to enable better analysis and decision-making

• Innovative financing structures can help get through the cost barrier to pay for retrofits... But accessing these requires

d d j d !good pre- and post-project data!

• Sharing modeling data can help get access to capital whether internal or 3rdaccess to capital, whether internal or 3party

• Ongoing M&V tools enable continuous building operations improvement

• Sharing data post retrofit can help support hard and soft value creation andsupport hard and soft value creation and higher property values

1 ASSESS1. ASSESS

2 ACCESS CAPITAL2. ACCESS CAPITAL

3 APPRAISE3. APPRAISE

Section II

FINANCEFINANCEJames Finlay

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VP, Sr. Commercial Appraisal Manager Wells Fargo

1 ASSESS1. ASSESS

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Financing is not the problem -Financing is not the problem -Undefined risk is the problem

Construction Risk is ComplexImprecise models

EE upgrade overview: Compare, select

d Lack of collaboration

Scope too ambitious

upgradesNew financing optionsUse technology

Financing

RiskCollaboration

Relationships Finance RiskLack of baseline

to measure against

Risk Adjusted  Well 

defined

p

Rate of Return

defined Risk

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Define the Investment RiskDefine the Investment Risk

Money flows to investments

Money flows to investments

High RiskHigh Risk Low RiskLow RiskUnknown Risk

Unknown Risk

investments when there is a

clear and

investments when there is a

clear andCorp. Junk Bonds

US Treasury ???

clear and measurable risk adjusted rate of

clear and measurable risk adjusted rate ofOK OK Not  adjusted rate of

return.adjusted rate of

return.OK OK ot

OK

Use technology to establish point of beginning

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and then track on-going performance

Investment risk can be viewed differentlyInvestment risk can be viewed differently

PeopleCreditReal EstateCredit

Cash flowRisk

Reversion*, value at sale Risk

R l tiRegulationsUtility Prices

31

y

Incentives, disclosure requirements

But it’s OK ! Complex risk challengesBut it s OK ! Complex risk challenges have been dealt with before.E t 3 d t itt t i d fi d t d dExpert 3rd party written reports using defined standards

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Ownership & debt culture varies by “tribe”Ownership & debt culture varies by tribe

1 SFR / 1 4 units1. SFR / 1-4 units2. Small C & I: SBA, mom &

pop/owner-user < $2MMpop/o e use $

3. Medium C & I: larger owner-user/part owner-user, local investor –$2MM t $10MM$2MM to $10MM

4. Large C & I: multi-tenant leased investment – >$10MM$

5. Multifamily: medium / large investor grade apartments, condos

6. Specialty: gas station, fast food, hotel/motel, theater, data centers

7 MUSH: M i i l U i it S h l

33

7. MUSH: Municipal, University, School (grades 1-12), Hospitals

2 ACCESS TO CAPITAL2. ACCESS TO CAPITAL

34

Investment Capital Access Depends onInvestment Capital Access Depends on each Unique Situation

Holding Period MUSH vs.. Investor

Building Size SBA vs.. Large C&I

Upgrades Choice EE or Distributed Generation

Split Incentive Green Leases

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Source of Investment/Financing DollarsSource of Investment/Financing Dollars

CASH Owner Cap Ex budgetCASH Owner Cap Ex budgetDEBT Traditional bank loanOTHER Utility, public, ESCO

SBA Utility On-Bill

ata SBA

GrantIncentives

y

PerformanceContracting

Da Incentives Contracting

PACE, PACE Plan C

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Solar programs, DG programs

Construction Lending is specialized riskyConstruction Lending is specialized, risky1. Construction lending specialized1. Construction lending specializedUpgrades have different risk profilesUpgrades have different risk profiles

• Costly to manage• Small loans not practical

2 Often credit based not collateral

• Costly to manage• Small loans not practical

2 Often credit based not collateral

1. On‐site power –Solar photovoltaic, wind, hydro

2 Energy Efficiency (EE)

1. On‐site power –Solar photovoltaic, wind, hydro

2 Energy Efficiency (EE) 2. Often credit based, not collateral3. EE complex to verify4. Financing matters,  just not as 

2. Often credit based, not collateral3. EE complex to verify4. Financing matters,  just not as 

2. Energy Efficiency (EE) –Insulation, windows,  sensors

3. Power offset 

2. Energy Efficiency (EE) –Insulation, windows,  sensors

3. Power offset 

N C t ti

much as imagined, won’t changemuch as imagined, won’t changesolar thermal, fuel cells, cogensolar thermal, fuel cells, cogen

Existing Buildings New Construction

37

3 APPRAISE3. APPRAISE

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“Market Value“ based on buyers sellers

Sales CompWhen property owners are i d thi k

Market Value based on buyers, sellers

IncomeSales Comp

Incomeconvinced something makes sense, that’s the market

Three Hits at Value

Information + intuitionQuantity + Quality at Value

Owner’s “skin in the game” is the t ti t t

Decision To

Cost*most conservative test

Data + Analysis

Decision To Act Investments

yNo Action

39

Value = dependable results over timeValue = dependable results over time• Snapshots performance views not enough• Make energy/resource use visible• Behavioral economics can be tricky

Occupants Appraiser Government

• Lots of people, all need to be convinced

Owner Occupants Appraiser Underwriter Governmentexaminer

Operations B k Chief credit

40

C levelOperations staff RE agent

Banker officer

Spinning the value flywheel Learn & EarnSpinning the value flywheel – Learn & Earn1. As-Is, where-Is

b li hi t i ti

11

baseline historic operation2. Fruit on the ground

building Maintenance

22

66building Maintenance

3. Low Hanging Fruit payback < 2 years

VALUE VALUE STAGESSTAGES

y y4. Medium Payback

2-7 years

33

555. Long Payback >7 years

6 Net Zero (Energy/Resources)44

6. Net Zero (Energy/Resources)The true goal, or even better the Living Building Challenge

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Deep Retrofits = Value Beyond CostDeep Retrofits = Value Beyond Cost Savings

• Expense Savings• Expense SavingsHard Internal

"Not everything that counts can be• Reversion• Reversion

Soft Internal

counts can be counted, and not 

everything that can• Productivity• Employee Attraction• Productivity• Employee Attraction

everything that can be counted counts."

p yp y

• Reputation• ReputationSoft External• Reputation• Corporate Mandate• Reputation• Corporate Mandate

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Building/Resource Management System isBuilding/Resource Management System is vital• A monitoring system is an investment not a cost• A monitoring system is an investment, not a cost

• Payback on reliability, visibility, lower risk + record keeping

• Monitors the Resource Quintet –Energy, Water, Waste, Carbon, IEQ (Indoor Environmental Quality)

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Operating data + Analysis = ReportsOperating data + Analysis = Reports

“Ho m ch mone are o losing?”“How much money are you losing?”

“Audit = Action”“Audit = Action”

The Resource Appraisal:The Resource Appraisal:a new type of due diligence

44

report is needed

FINANCE CONCLUSIONSFinance Conclusions

• A monitoring system is an i t t t t

Finance Conclusions

investment, not a cost

• Integration: transparency, data over time manage risk behavioraltime, manage risk, behavioral economics

• Public/private credit enhancement• Public/private credit enhancement, incentives

• Value beyond cost savings: risk• Value beyond cost savings: risk and reputation

• Need credible due diligence• Need credible due diligence reporting by experts, just like other risks have been assessed in the past… The Resource Appraisal

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1. MODEL

2. MEASURE

3. MANAGE

Section III

TECHNOLOGYTECHNOLOGY Aniruddha DeodharSustainability Program Manager

46

y g gAutodesk

1. MODEL

47

Building Information Modeling EnablesBuilding Information Modeling Enables Sustainable Building Operations

MANAGE

Intelligent

BUILDPLAN

model-based process

DESIGN

48

BIM Guides Evaluation Of EnergyBIM Guides Evaluation Of Energy Conservation Measures (ECMs)

Lighting Upgrades?Plant Upgrades?

Renewables?Building Envelope?

Model courtesy of DesignGroup and the National Audubon Society

Rapid Energy Modeling Streamlines EnergyRapid Energy Modeling Streamlines EnergyAssessments Of Existing Buildings

Energy AnalysisEnergy Analysis

Detailed ModelDetailed Model

Satellite ImagesSatellite Images AnalysisAnalysisModelModel

PhotosPhotos

AerialAerialECM 

Prioritization ECM 

Prioritization Conceptual Model

Conceptual Model

Aerial ImagesAerial Images

& Optimization

& Optimization

Laser 

Survey

Laser 

SurveySurveySurvey

capture model analyze

Conceptual Energy Analyses Allow EarlyConceptual Energy Analyses Allow Early Stage Environmental Assessments

2. MEASURE

52

International Performance M&V Protocol Endorses Calibrated Simulation

Chart from International Performance Measurement & Verification Protocol, Concepts and Options Determining Energy and Water Savings Volume 1, Efficiency Value Organization, Sep 2010

53

Modeling And Measuring Optimize ECMsNet Zero Energy

Modeling And Measuring Optimize ECMsgy

calibration

Plant Upgradesdesign alternatives

what-if analyses

R bl

y

Renewables

ECM 2financial metrics

ECM 154

lifecycle cost analyses

Better Instrumentation Increases DataBetter Instrumentation Increases Data Transparency

SBuilding Control System Sub-meters Sensors

Building Floor Cubicle

3. MANAGE

56

Understanding Building Energy ManagementUnderstanding Building Energy Management

Services

Control VisualizationTechnologies

Hardware Analytics Active Systems

Innovative Hardware Technologies ThatInnovative Hardware Technologies That Deliver High Return On Investment

Direct Digital Controls; Wireless, Smart Thermostats; Pulse, Real‐time Smart MetersDirect Digital Controls; Wireless, Smart Thermostats; Pulse, Real‐time Smart Meters

Occupancy; Motion; Daylight; CO2 SensorsOccupancy; Motion; Daylight; CO2 Sensors58

Elevator Upgrades; Data Center EfficiencyElevator Upgrades; Data Center Efficiency

Efficient Lighting, Daylight HarvestingEfficient Lighting, Daylight Harvesting

Variable Frequency Drives; Economy cyclesVariable Frequency Drives; Economy cyclesVariable Frequency Drives; Economy cyclesHigh SEER RTUs; Turbocor CompressorsVariable Frequency Drives; Economy cyclesHigh SEER RTUs; Turbocor Compressors

Control Layer Helps Monitor And ManageControl Layer Helps Monitor And Manage Hardware

Smart Wireless ControlsSmart Wireless Controls

Demand Side Management ControlDemand Side Management Control

Motion, Occupancy and Lighting  ControlsMotion, Occupancy and Lighting  Controls

Security and Access ControlSecurity and Access Control

59

Advanced Analytics Aid Decision MakingAdvanced Analytics Aid Decision MakingStatistical AnalysisStatistical Analysisy• Benchmarking• Input Inference

y• Benchmarking• Input Inference

Empirical AnalysisEmpirical Analysis• Historical Information• Advanced Data Mining• Historical Information• Advanced Data Mining

Predictive AnalysisPredictive Analysis• Calibrated Simulation• Rules Engines

N l N k

• Calibrated Simulation• Rules Engines

N l N k• Neural Networks• Neural Networks

Built Upon Billions Of Time Series Control Data Points60

Visualization Technologies EnhancesVisualization Technologies Enhances Communication And Visibility

Building Performance DashboardBuilding Performance Dashboard

3D, Real‐time, BIM‐based Visualization3D, Real‐time, BIM‐based Visualization3D, Real time, BIM based Visualization3D, Real time, BIM based Visualization

Portfolio Analysis and BenchmarkingPortfolio Analysis and Benchmarking

B ildi P f L b liB ildi P f L b liBuilding Performance LabelingBuilding Performance Labeling

Active Systems & Services Deliver End toActive Systems & Services Deliver End-to-End Solutions for Sustainable Buildings

Demand ResponseDemand Response

Building AutomationBuilding Automation

Energy ServicesEnergy Services

Integrated Building Management (Energy, Facilities, Operations, Asset, Maintenance)Integrated Building Management (Energy, Facilities, Operations, Asset, Maintenance), p , , ), p , , )

Lighting HVAC RetrofitsLighting HVAC RetrofitsLighting, HVAC RetrofitsLighting, HVAC Retrofits

Bringing It All TogetherBringing It All Together

13MODEL

MANAGEverify

optimize

MEASURE2

63

Real time BIM based Energy PerformanceReal-time, BIM-based Energy Performance Dashboard

64

Alternate Incentive And Contract StructuresAlternate Incentive And Contract StructuresNeeded For Successful Retrofits

Owner

BIM Web BasedCollaboration

Architect/ User

Digital Modeling and Collaboration

Contractor

S F S

Architect/Engineer

E SE

User

Lessons from Integrated Project Delivery65

Some Of The Standards AcceleratingSome Of The Standards Accelerating RetrofitsPhase Entity Name Goal

Model ASTM BEPA Data Collection

Model RESNET COMNET Energy Assessment Software Compliance

Model ASHRAE 90.1 Building Energy Standard

Model Open Source gbXML BIM Based Energy Analysis

Measure ASHRAE BACNet BEMS Control

Measure Open source Project Haystack Taxonomy For Building Equipment & Points

Measure ASHRAE SPC205 HVAC Equipment Performance

Manage ASHRAE SPC201 Smart Grid Information Model

Manage ISO ISO 5001 Energy Management Systemsg gy g y

Manage Various Building Energy Labeling

Asset and Operational Ratings

66

Technology ConclusionsTechnology Conclusions

Tech. ValueProposition

Benefits To Finance

Benefits To OperationsProposition Finance Operations

Data Transparency

• ↓Risks • Data for

• ↑ Performance VisibilityTransparency

Infinite

Data for Appraisal

Key Metrics

Visibility• Aid M&V

↑ D t G th iInfinite Computing

• Key Metrics• Proof to ↑ Value

• ↑ Data Gathering• Optimize ↑ROI

ECMs

Convergence • Manage RisksCommunicate

ECMs

• ↑ Visibility Improves O+M• Communicate

Value• Improves O+M

Retrofit Triangle Conclusions

68

Operations Conclusions• Technology aids in gathering quality

Operations Conclusionsgy g g q y

data, which enables clear analysis and decision-making

Robust performance data can help get• Robust performance data can help get access to capital, whether internal or 3rd

party

• Sharing data post retrofit helps support hard and soft value creation, and higher property values

• Ongoing M&V tools enable continuous building operations improvement

Investigate, Implement, Improve

FINANCE CONCLUSIONSFinance Conclusions

• Integration: transparency, data over time,

Finance Conclusions

manage risk, behavioral economics

• Public/private credit enhancement, incentives can defray costsincentives can defray costs

• Value beyond cost savings: risk and reputation

• Need credible due diligence reporting by experts, just like other risks have been assessed in the past The Resourceassessed in the past… The Resource Appraisal

70Assess, Access Capital, Appraise

FINANCE CONCLUSIONSTechnology Conclusions

• Technology can bridge the gap between

Technology Conclusions

finance and operations

• Data Transparency helps to quantify, reduce and manage riskreduce, and manage risk

• Modeling through BIM allows for rigorous analysis of potential combinations of ECMs

• Performance visibility leads to behavior change and opportunities for continuous improvement

• Performance measurement provides data for Resource Appraisal, and supports property valuationproperty valuation

71Model, Measure, Manage

Key Take aways• Monitoring system is an investment, not a cost

“D t f ” thi h

Key Take-aways

• “Data fog” = nothing happens

• Make the numbers mean something to the intended audience

• Technology allows for quantification and management of risk at each project stage

Ti ti l d t t k l d i t d• Tie operational data to key value drivers… rents and occupancy

• Implementing efficiency retrofit projects translates to investment value with social and environmental benefitsvalue with social and environmental benefits

QUESTIONS

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THANK YOU!THANK YOU!

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Section IV

PANELIST BIOSSection IV

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David HodginsDavid Hodgins

I hi l ith th CCI EEBRP D id lt t i l tf liIn his role with the CCI EEBRP, David consults to commercial portfolio owners undertaking resource efficiency projects, and works with Cities to develop programs to facilitate and incentivize such projects. David has consulted on the development of over 30mm square feet of resource p qefficiency projects, and is currently consulting with several large US cities to develop and implement financing programs to accelerate the commercial energy efficiency market. David’s areas of expertise include resource efficiency retrofit finance performance contracting portfolio strategy andefficiency retrofit finance, performance contracting, portfolio strategy, and environmental policy.

Commercial Sector Project Development ManagerClinton Climate InitiativeBuilding Energy Efficiency Retrofit Program624 S Dunsmuir Ave #102Los Angeles , CA 90036Office: (857) 277 – 4291dh d i @ li t f d tidhodgins@clintonfoundation.org

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Daniele Horton LEED AP + O&MDaniele Horton, LEED AP + O&MDaniele Horton has over 15 years of industry experience. She is the Sustainability Manager for Thomas Properties Group, where she administers the sustainability performance of the p p, y preal estate portfolio nationwide spanning entitlement, design, construction and operations. She runs the LEED EB O&M Certification program for the firm’s nationwide portfolio of 33 office buildings and has managed the LEED Certification of more than 13Million sf to date in house. The company has been recognized by several institutions for their leadership in p y g y psustainability including the NAREIT Leader in the Light Gold Award, Energy Star Leader Award and has most recently been ranked as the highest environmental performer among public funds in North America by the Global Real Estate Sustainability Benchmark.

A LEED AP since 2003, with a Professional Certification in Construction Management and a California Real Estate License, she sits on the California Sustainability Alliance Green Buildings Committee, the BOMA LA Sustainability Committee, the USGBC-LA Board of Directors and founded and Chairs the first Existing Buildings Committee in the countryDirectors and founded and Chairs the first Existing Buildings Committee in the country. Previously, Ms. Aquino worked as an architect and planner in Brazil and the US. She earned her Master's in Sustainable Development from Harvard University and her Bachelor's in Architecture & Urban Planning from Catholic University of Goias in Brazil.

Sustainability ManagerThomas Properties Group515 South Flower Street, 6th Floor Los Angeles CA 90071Los Angeles, CA 90071Office: 2132332530dhorton@tpgre.com

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Aniruddha DeodharAniruddha DeodharAniruddha Deodhar is Sustainability Program Manager at Autodesk, where he is responsible for end to end energy solutions He recently led one ofhe is responsible for end-to-end energy solutions. He recently led one of Autodesk’s Sustainable Buildings Living Labs strategies - rapid energy modeling, that make attaining green energy retrofits in commercial buildings quicker and more cost effective. He also co-developed C-FACT, abuildings quicker and more cost effective. He also co developed C FACT, a novel, business friendly approach to corporate greenhouse gas reduction targets.Aniruddha brings more than a decade’s experience in high technology inAniruddha brings more than a decade s experience in high technology in Asia, Europe and North America. Aniruddha received his M.B.A with Distinction from the Kellogg School of Management and B.A.Sc. Computer Engineering with Honors, from Nanyang Technological University, g g , y g g y,Singapore.

Sustainability Program ManagerSustainability Program ManagerAutodesk1 Market Street, Suite 500, San Francisco CA 94105Office. 415-356-3242aniruddha.deodhar@autodesk.com

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James FinlayJames FinlayIn addition to managing and reviewing appraisals and a wide variety of commercial

t t h i l th i i l f LEED d i d dproperty types, he is also the primary appraisal manager for LEED designed and high performance real estate collateral. These valuations can also include solar photovoltaic arrays and other types of on-site distributed power systems. Since

l 2006 h h b h i l/ l i i f h b k’early 2006 he has been the appraisal/valuation representative of the bank’s Environmental Initiative Team. To date Wells Fargo has extended over $3.25 billion to high performance / “green” real estate. Prior to being an appraiser he was a commercial leasing and sales agent based in Santa Monica for a total more than 20 years in commercial real estate. He currently chairs the USGBC LA Chapter’s Commercial Real Estate & Finance subcommittee and holds a B.A in Mechanical Engineering and Economics at the University of Kentucky, he is a General Certified Appraiser, and has a CA Real Estate Sales license.

VP S i C i l A i l MVP, Senior Commercial Appraisal ManagerWells Fargo707 Wilshire Blvd, 11th FloorLos Angeles CA 90017Los Angeles CA 90017Office: 310-821-8111James.F.Finlay@WellsFargo.com

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