Energy Labels: Coming to a Building Near You
Updated: May 18, 2018
We find nutrition labels on our food, fuel efficiency labels on new cars, and can even see energy star ratings on new appliances, but what would a label on our offices tell us?
Starting July 1st we’ll start to get a snapshot of the energy and water consumption at the buildings we frequent daily; it will start with large commercial and industrial buildings. That’s because July 1st, 2018 will be the first reporting date under the Province’s Energy and Water Reporting and Benchmarking (EWRB) regulation.
Providing a transparent means for benchmarking energy performance is one way to encourage building owners and managers to take action on reducing energy consumption. The Portfolio Manager system will be used to generate Energy Star scores for buildings that enter information on their energy and water consumption. Many will recognize the Energy Star score from appliances, computers and other consumer goods that use energy.
The Province is also hoping that the system can show the benefits of investing in energy efficiency. Other systems around the world like Austrailia’s NABERS rating have proved to be effective in demonstrating financial benefits and providing market recognition for buildings who operate in a sustainable manner.
Labeling itself is not new within the commercial real estate space here in Canada. Programs like LEED, BOMA BEST and now wellness certifications (WELL and fitwel) are commonplace. Building owners and managers are competitive when it comes to obtaining the highest levels of these certifications, however these often roll up a number of factors outside of energy consumption alone.
The EWRB reporting will provide an annual check on energy performance, while other certifications mentioned above may only be certified every 3 years. New builds certified under programs like LEED don’t actually have to be recertified at all, unless they choose to pursue an existing building certification.
Phased Implementation Approach
When the first July 1st 2018 reporting date hits, it probably will not come as a shock to much of the downtown office stock, many of which already have multiple voluntary certifications described above. That’s because the Ministry of Energy has adopted a phased approach that requires buildings to report based on their gross floor area (see below).
Once you start getting to buildings that are around 100,000 square feet and less, the picture changes. At that size, buildings may not have dedicated staff that look at managing energy. When you dip below the 100,000 square feet mark in buildings that are not owned or managed by large firms, it’s even more likely that energy is not a top concern. Smaller organizations may not even know about the regulation or what’s required to start collecting the data they need. For those reporting in 2019, 2018 data must be disclosed and the year is already well underway.
What does disclosure look like?
The idea of energy and water benchmarking and disclosure are not new. The EU implemented a similar model in 2010 and American cities have adopted the same. Data visualizations are even available to explore cities like New York. NYC’s Local Law 84 (LL84) required private buildings over 50,000 ft2 and public sector buildings over 10,000 ft2 to report their energy and water consumption each year for public disclosure.
It’s a good time for all building owners to start thinking about the reporting that is going to affect them. As tenant organizations are trying to appeal to sustainability concerns of their millennial employees, energy and water consumption will be important. Then there’s the concern of utility costs. Public disclosure means that resourceful tenants can do their own research beforehand and shop around for comparisons in terms of energy use at a building before they engage in leasing conversations.