Institute for Market Transformation

Creating jobs while measuring energy consumption





These five words - "building energy rating and disclosure" - are enough to put people to sleep. What does that phrase mean? And why do I care, especially when the housewives are screaming again on reality TV? Now, they are really interesting.

Please, stay with me here. The housewives will be screaming again next week, but this is important. As it turns out, those five words are pretty significant in today's energy-saving environment, especially in California and Washington state, where they could lead to many new jobs.

Five cities and two states (New York City; San Francisco; Seattle; Washington, D.C.; Austin, Texas; and California and Washington states) have passed laws requiring owners of large buildings to measure ("benchmarking" in industry-speak) and disclose how much energy their structures consume.

California calls its plan the "Nonresidential Building Energy Use Disclosure Program," which stems from AB 1103.The regulations require owners of nonresidential property to, before selling or leasing buildings, to benchmark their energy use, and to disclose that data to potential buyers, lessees and lenders.

The program is being phased in according to property size. Owners of structures with at least 50,000 square feet must benchmark this year. Owners of structures of 10,000 to 50,000 square feet must implement a program starting in January 2013. July 1, 2013, is the start date for owners of commercial buildings from 5,000 square feet to 10,000 square feet.

Formal policies are in place in the five cities and two states, but thousands of properties have been benchmarked voluntarily throughout the nation - and the practice is growing as the sustainability movement gains speed. Our nonprofit is a leader in benchmarking and works with local governments throughout Central California. See more here.

Jobs also are being created - such as at FS Energy in New York City, which has added seven positions, and at Sustaining Structures in Seattle, which expects to triple in size after experiencing a 30 percent boost in its number of clients, according to studies and this press release by the Institute for Market Transformation (IMT), a nonprofit that promotes energy efficiency and produced two reports.

Another New York City business, Ecological, added more than 400 clients after the policy took effect there. "We anticipate this trend will continue with year of compliance reporting," Chief Operating Officer Lindsay Napor McLean stated in a media backgrounder released by IMT.

Spectacular things could happen if the policy became nationwide. IMT estimates 23,000 jobs could be created in 2015 and 59,000 jobs in 2020. A nationwide program would reduce energy costs by more than $18 billion through 2020, and would reduce annual greenhouse gas emissions by the equivalent of 3 million vehicles.

The adage "you can't manage what you can't measure" holds true in benchmarking. Property owners can use the data to reduce energy costs, shrink their carbon footprint and score one for the environment .

IMT quotes Kevin Dingle. president of Sustaining Structures in Seattle as saying: "When an owner or manager sees a benchmarking score might be lower than expected, they're a little more receptive to improvements to bring the score up, which in turns lowers their utility costs. It makes it 'real world' for them when they see the numbers."

Andrew Burr, lead author of the IMT reports, says, "Better information means more competition for better buildings. . . And that means more work improving American buildings and more American jobs."