Metrics That Matter

A business case for energy efficiency

There is a compelling business case for energy-efficient buildings. When done right, new buildings can achieve energy efficiency at almost no added costs. Even in the case of existing buildings, energy-efficiency retrofit costs can be recovered in about 2-3 years. Yet how often do teams miss getting a decision maker’s approval for their sustainability measures or projects?

The key issue here is that sustainability as a business case works only if the right steps are taken in the right order with an integrated approach. Further, proposals must be presented in a language that decision-makers can easily understand, translated into metrics that matter to them.

In this webinar, industry veteran Aalok Deshmukh discusses how to identify the right metrics to tell your high-performance story. He also illustrates how an integrated whole-building design approach helps reduce costs and maximize benefits of different design measures. The discussion will help you present your sustainable design proposal to decision-makers with greater impact.

It is important to talk in the language of your clients and identify their Key Performance Indictors (KPIs) and Key Responsibility Areas (KRAs). The energy use intensity or ‘KWHr/sft’ metric commonly used by sustainability professionals is not intuitive to other businesses. For example, the hospitality sector widely use the cost per room metric whereas hospitals look at the cost per bed.

While deciding the metric, we need to make sure it is geared towards the decision-maker or client. We need to identify the relevant ‘currency’ and the ‘core business unit’. ‘Currency’ could be money, reduced carbon dioxide emissions or energy use intensity. Industries typically use a ‘core business unit’ to evaluate the size of business- for example in case of hospitality, it is the number of rooms. For hospitals, it’s number of beds.  The metric can be then arrived at by using the currency as the numerator and core business unit as the denominator.

Going forward, it is important to take a whole building or integrated approach  to demonstrate the full potential of building energy efficiency benefits. In the conventional approach, each system is evaluated independently. In this case, as energy savings rise, the associated costs compound as well. On the other hand, a whole building approach helps ‘tunnel’ through the cost barriers and achieve big cost and energy reductions.

In order for sustainable projects to be financially feasible, the right steps must be taken in the right order. Here’s a simple approach to keep in mind. First, Be Lean (halve the demand), then Be Mean (double the energy-efficiency) and finally, Be Green (halve the carbon). The webinar looks at how this approach applies to designing various systems like cooling, lighting as well as whole buildings.

We also learn the success stories of different project teams at Infosys and CARBSE. For example, the Green Initiatives team used an integrated approach to demonstrate capital and operational cost reductions of an optimized building envelope. Another case study looks at the winning pitch by Empire State Building’s energy-efficiency retrofit team. The proposal demonstrated both the carbon reductions and the increase in Net Present Value over time.

Interestingly, these storytelling strategies are not time-intensive and need only a small additional effort. Yet, they have the potential to create a big impact and seize the full opportunity of sustainable building design.

This webinar was conducted on  6th March, 2020