Behold the Power of Retrofit
By Elizabeth Cutright
Saving energy is as easy as turning back the clock, right? Every year during Daylight Savings Time (and sometimes again, upon the return of Standard Time), millions ponder the efficiency of resetting clocks and creating the illusion of an extra hour of daylight. In an attempt to assuage our gritty eyes and sleep-deprived souls, we console ourselves that the time change is important because it saves energy.
But is that really the case?
While studies disagree as to whether Daylight Savings Time saves energy or leads to greater energy use, all agree that the effect, one way or the other, is around 1%, or $4 US dollars per household. Additionally, some studies estimate that Daylight Savings Time-observing regions actually experience significant drop off in worker productivity during the first three weeks of the time change—up to $480,000,000 per year. And because running one air conditioner during the day uses more energy than leaving dozens of incandescent light bulbs on all night, hotter climates—like Hawaii and Arizona—tend to ignore Daylight Savings time altogether.
So if turning the clocks back isn’t the easy energy saver we’ve all been led to believe it is, what’s the alternative?
I’m going to bang the drum once again for energy efficiency retrofits. As we’ve discussed many times before, retrofits are particularly valuable, because they combine the potential for huge energy efficiency gains with low overhead and implementation costs. In fact, the one silver lining of our chronically depressed real estate market is that while funding for new construction projects has dried up, retrofits are gaining more traction. For fewer pennies on the dollar, old, drafty buildings get a second life—thanks in part to smart, energy-efficient retrofits.
In 2010 a Pike Research study indicated the US could save up to $41 billion a year as a result of these efficiency upgrades. And according to new research from the Deutsche Bank and the Rockefeller Foundation, investments in energy efficiency retrofits have the potential to save up to $1 trillion in energy costs in the next decade. And that $1 trillion can be had at about 1/4 the cost of investment—about $279 billion in improvements to residential, commercial, and institutional buildings throughout the US.
“Buildings consume approximately 40% of the world’s energy and are responsible for 40% of global carbon emissions,” says Rockefeller Foundation President Judith Rodin. “Improving those numbers by retrofitting existing buildings for better energy efficiency could have huge impacts that go beyond just energy use.”
While it seems that the commercial sector would have the rawest nerve when it comes to energy costs, the federal government has actually been the first out the gate, pursuing energy efficiency with a renewed fervor. Last December, President Obama announced the creation of a $4 billion fund—made up, in part, by private sector investment—to finance federal and private sector energy building upgrades over the next two years.
And the impact of the funding is already being felt at federal buildings throughout the country. Just last month it was announced that the US General Services Administration (GSA) is now accepting bids for projects under the Deep Retrofit Challenge, a program spurred by the President’s announcement. Under the challenge, service companies can bid on energy efficiency retrofit projects for 30 federal buildings earmarked by the GSA for upgrades. These energy service companies—16 of which have already been preapproved under a contract with the DOE—will consult with the GSA on design and will guarantee that any improvements will result in energy cost savings in an amount sufficient to pay for the project over the term of the contract.
“This is a challenge to the private sector to bring innovative, energy-saving retrofits to federal buildings and to take performance-based contracts to the next level,” said Martha Johnson, administrator of the GSA, in a statement. “These retrofit projects create jobs, and performance-based contracts provide government with decades of lower utility bills and long-term cost savings without an upfront investment from the taxpayers.”
But funding and financing for private entities is still a challenge. Although there’s money to be found in energy service agreements like those available under the Deep Retrofit Challenge—as well as other monies available via PACE financing, on-bill energy efficiency tariffs, and on-bill energy efficiency loans—for many private businesses, navigating the hoops and hurdles of each program is difficult and intimidating.
While a commitment by the federal government to increase energy efficiency retrofits is heartening, we must find a way to make retrofits more accessible. Commercial buildings are our biggest energy users and stand to gain the most from efficiency retrofits.
“Upgrading the energy efficiency of America’s buildings is one of the fastest, easiest, and cheapest ways to save money, cut down on harmful pollution, and create good jobs right now,” said President Obama. “America is taking another big step towards the competitive, clean energy economy it will take to win the future.”
Elizabeth Cutright is the editor for Distributed Energy Magazine.