President Obama on Friday ordered $2 billion in energy efficiency upgrades to federal buildings, a move that will create jobs and save businesses and taxpayers significant energy costs, according to Coreina Chan, a consultant at Rocky Mountain Institute.
RMI, a leading player in deep building retrofits, works with the federal government’s largest property owner, the General Services Administration (GSA), and private partners to achieve energy savings in excess of 50 percent.
Obama’s program — paid for through savings in energy costs — will use performance-based contracts with private firms to upgrade federal properties, said Jeffrey Zients, the president’s chief performance officer. It aims to upgrade energy performance by a minimum of 20 percent by 2020.
While RMI is "especially excited about the government’s commitment to use performance contracts to finance deeper energy savings," Chan said, "target savings need to reach 20% by 2020 and go far beyond in the years to come."
The program calls on the private sector to invest an additional $2 billion in similar efforts. The private-sector effort, backed by 60 mayors, university chiefs and labor leaders, will bring commitments to upgrade 300 manufacturing plants encompassing 1.6 billion square feet of commercial property in industrial, municipal, hospital, university, community college and school settings.
The U.S. government owns and operates nearly 3 billion square feet of building space.
"Upgrading the energy performance of buildings is one of the fastest and most effective ways to reduce energy costs, cut pollution, and create jobs in the construction and energy sectors," Obama’s announcement said. Obama's investment in retrofits is part of the Better Buildings Initiative. The initiative would create more than 114,000 jobs in construction, manufacturing and service sectors, according to a report by the U.S. Green Building Council.
The move promises to accelerate retrofit efforts under way.
"This memorandum represents a major shift toward practices RMI has been working on with the GSA and other major real estate owners and managers to implement," Chan said. "This dovetails nicely with the work RMI’s RetroFit Initiative has just begun on the GSA’s recently announced Net Zero Renovation Challenge."
In the challenge, 16 companies that already have energy service provider contracts with federal agencies will submit plans to retrofit more than 30 GSA buildings to bring them to net zero energy — or as close as possible.
GSA asked RMI to participate in part because of the success of the Byron Rogers Federal Building retrofit in Denver. RMI is serving as a consultant on the project, which should achieve net zero by 2030 and is on target to become one of the most the most energy-efficient office building in the nation. The existing building uses 90 kBtu/sf/yr and the new retrofit design is projected to use about 35 kBtu/sf/yr, a 61% savings.
"The goal of RMI’s RetroFit Initiative is to accelerate deep energy savings retrofits in the nation’s existing commercial building stock," Chan explained. "The government is now taking a longer-term view on financial returns and paybacks from retrofits, and hunting for cost-effective opportunities by looking at buildings from a portfolio perspective as opposed to on a per-building basis,” she says.
RMI envisions a U.S. energy future that supports a 158 percent larger economy with no oil, coal or nuclear power by 2050. The plan for getting there is laid out in the capstone book, Reinventing Fire. Dramatically improved efficiency in buildings, which account for 42 percent of the nation’s energy use, is a key. To go from plan to action, RMI collaborates with industry leaders in several focus areas. Through the RetroFit initiative, RMI collaborates with commercial building owners and service providers — with an emphasis on building portfolios — to develop solutions that will bring deep energy retrofits to scale in commercial buildings.
Under the Obama program announced today, private contractors will track their energy savings progress on government websites. The memorandum’s emphasis on energy use reporting is crucial, according to Chan.
"Transparency is an important enabler,” she said. "In theory, we’re all interested in the benefits of a healthy diet and a personal fitness regimen, right? In practice, everyone wants to ‘look good naked.’ Requiring building owners to report their building energy use for all to see is an important incentive for making improvements in building energy use."