Distributed Generation and Demand Response 

Market-Integrated, ADR Can Play a Role in Microgrid Management

How EE is Evolving into Intelligent Efficiency

Information Technology, SaaS Monitoring Platforms Lead Way

In the 1800s, the convergence of printing technology and steam power created the first form of mass communications -- bringing with it sweeping changes in literacy and education. In the 1900s, the convergence of radio and television with electricity and the oil-powered combustion engine created the modern consumer-based society we know today.

We are now on the verge of a third revolution, argues economist Jeremy Rifkin. This one will be abetted by the convergence of the internet and distributed energy, creating new ways to do business, communicate, and build wealth. Rifkin calls this a "new economic paradigm for the 21st century."

This new paradigm is already reshaping the way we think about energy efficiency.

All around us, embedded in every commercial building, manufacturing facility and corporate campus, is a vast, untapped energy resource: efficiency. In the past, that resource was hidden, ignored or misunderstood by the companies sitting on the potential, and recognized only by a small group of energy professionals.

But with dramatic advances in web-based monitoring, real-time data analytics and utilities using peak pricing, that hidden resource is now becoming something tangible -- an asset that companies can measure, manage, procure and sell.

This isn't the stale, conservation-based energy efficiency Americans often think about.

"In the past, energy efficiency was seen as a discrete improvement in devices," says Skip Laitner, an economist who specializes in energy efficiency. "But information technology is taking it to the next level, where we are thinking dynamically, holistically, and system-wide."

This emerging approach to energy efficiency is information-driven. It is granular. And it is empowering consumers and businesses to turn energy from a cost into an asset. We call this new paradigm "intelligent efficiency."

That term, which was originally used by the American Council for an Energy-Efficient Economy in a 2012 report, accurately conveys the information technology shift underway in the efficiency sector.

The IT revolution has already dramatically improved the quality of information that is available about how products are delivered and consumed. Companies can granularly track their shipping fleets as they move across the country; runners can use sensors and web-based programs to monitor every step and heartbeat throughout their training; and online services allow travelers to track the price of airfare in real time.

Remarkably, these web-based information management tools are only now coming to the built environment in a big way. But with integration increasing and new tools evolving, they are starting to change the game for energy efficiency.

Although adoption has been slow compared to other sectors, many of these same technologies and applications are driving informational awareness about energy in the built environment. Cheaper sensors are enabling granular monitoring of every piece of equipment in a facility; web-based monitoring platforms are making energy consumption engaging and actionable; and analytic capabilities are allowing companies to find and predict hidden trends amidst the reams of data in their facilities and in the energy markets.

This intelligence is turning energy efficiency from a static, reactive process into a dynamic, proactive strategy.

We interviewed more than 30 analysts and companies in the building controls, equipment, energy management, software and utility sectors about the state of the efficiency market. Every person we spoke to pointed to this emerging intelligence as one of the most important drivers of energy efficiency.

"We are hitting an inflection point," says Greg Turner, vice president of global offerings at Honeywell Building Solutions. "The interchange of information is creating a new paradigm for the energy efficiency market."

Based on our conversations with a wide range of energy efficiency professionals, we have identified the five key ways intelligent efficiency is shaping the market in the commercial and industrial (C&I) sector:

1. The decreased cost of real-time monitoring and verification is improving project performance, helping build trust among customers and creating new opportunities for projects;
2. Virtual energy assessments are bringing more building data to the market, leveraging new lead opportunities for energy service professionals;
3. Web-based energy monitoring tools are linking the energy efficiency and energy management markets, making efficiency a far more dynamic offering; 
4. Big data analytics are creating new ways to find trends amidst the "noise" of information allowing companies to be predictive and proactive in efficiency;
5. Open access to information is strengthening the relationship between utilities and their customers, helping improve choices about efficiency and setting the foundation for the smart grid.

When you're ready to get started: contactus@thgenergy.com 

The Gift That Keeps on Giving: Part 1

56% of U.S. Companies Project Increased EE Investment in 2015

America's corporate leaders are giving their facility and operations staff the necessary resources to reduce cost and usage via energy efficiency upgrades. The Season of Giving will translate into the Year of Giving in 2015. Companies are realizing that energy efficiency investments yield high ROIs and SaaS-based measurement and verification tools - like THG's EMS and real-time monitoring ADR solutions - help quickly prove out these operational savings for upper management and CFOs. 

Three quarters of decision-makers at U.S. companies have invested in energy efficiency programs in the past 12 months, and more than half (56 percent) project their investment in energy efficiency next year will be more than last year, according to survey results released by Schneider Electric. This represents a 12 percent increase in energy efficiency investments and a 13 percent increase in projected investments in the past 12 months, according to a similar survey of energy leaders conducted by Schneider Electric in June 2013.

"Increased investment suggests business leaders are seeing a return," said Laurent Vernerey, president and CEO, North America Operations, Schneider Electric. "In fact, more than half (51 percent) of respondents said they realize at least a 25 percent ROI on efficiency initiatives. This type of return will drive more investment in efficiency applied across the enterprise - beyond energy consumption -- as organizations find that they must become operationally efficient to remain competitive and profitable in today's environment."

One potential driver of the increased investment is simply that a path to efficiency is now easier to measure due to a major trend emerging across the enterprise: the convergence of information technology (IT) and operational technology (OT). When asked about the biggest trends impacting business today, more than half (56 percent) of respondents cited this trend, with 61 percent saying that energy efficiency was its biggest benefit. Byproducts of increased efficiency, including cost reductions (48 percent) and optimized business processes (43 percent), were also reported as benefits.

However, respondents also acknowledged that this trend comes with its own set of challenges, including more complex technology management (55 percent), security (54 percent) and conflict between IT and operations staff (47 percent).

"The need for efficiency is increasing, as is the complexity on what companies can and should do," continued Vernerey."To stay competitive, more and more companies today need expertise on issues such as how to manage volatile commodity costs, balance sustainability pressures from governments and modernize systems and infrastructure in a smart way."

Efficiency initiatives (12 percent) and sustainability demands (9 percent) rounded out the list of the biggest trends. Energy efficiency initiatives were identified by respondents as the top way (59 percent) companies do more with less in today's business environment and almost half of respondents said that sustainability initiatives improve profit margins (47 percent) and keep them competitive (49 percent).

Source: EDC Magazine  

The Gift That Keeps on Giving: Part 2

Global Energy Retrofits Could Reach $1T By '23

U.S. companies aren't the only ones wising up to the EE game. Retrofitting the existing built environment is a worldwide growth market set to explode over the next eight years.

According to Navigant Research, energy efficiency retrofits on commercial buildings domestically and internationally will total almost $1 trillion between now and 2023.  Regulations mandating such retrofits are one factor behind the estimated $959 billion in expenditures. Eric Bloom, principal research analyst with Navigant, comments, "While government mandates play an important part in driving this growth, many retrofit projects are being undertaken on a voluntary basis, as corporate sustainability initiatives spread." At the same time, many countries -- particularly the developing nations in Southeast Asia and other regions -- are looking to shore up their energy supply structure and identify measures to address energy demand issues.

The Navigant report states: "The increasing deployment of energy efficiency retrofits for commercial and public buildings provides an important pathway for increasing energy security, reducing -- or even decreasing -- energy demand, reducing GHG emissions, and reducing demand for new energy production and distribution facilities." The research further notes that energy efficiency retrofits can also be used by commercial building owners and their occupants to support greening and green marketing efforts. Navigant researchers are projecting that global revenue for energy efficiency commercial building retrofits will increase from $68.2 billion this year to $127.5 billion in 2023. The global market is expected to grow by 7 percent annually for the next nine years, led by the Asia-Pacific region.

One of our missions is to keep our customers abreast of energy and environmental trends impacting the C&I market.

The June '14 publication of the U.S. Environmental Protection Agency's proposed rule to reduce greenhouse gas emissions from existing power plants under section 111(d) of the federal Clean Air Act, marks the official launch of a multi-year engagement between EPA and state regulators. EPA's proposal reflects an unprecedented, comprehensive, and flexible integration of energy and environmental policy.

Some of the most cost-effective measures states can take - like Energy Efficiency - will also assist with 111(d) compliance. Getting started on such programs - even before the 111(d) rule is finalized - will position cities/states (and industry) for easier compliance and reduced costs. As such, THG anticipates early adoption of energy disclosure/benchmarking to support the 4th and final Building Block, "Energy Efficiency."  

Reporting Matters

Reporting and record-keeping requirements for a state plan are necessary by all distribution utilities, vertically integrated, private or public 3rd parties, and state agencies.  EPA is currently seeking comment on the examples and suitability of potential approaches.  We suspect ENERGY STAR Portfolio Manager to become a de facto tracking resource. Portfolio Manager is the industry's gold standard for current city/state disclosure policies, building challenges, and green building protocols. It's gone through years of field testing.  Oh, and it's "free."  *Provided you have staff allocated and dedicated to fishing utility bills out of Accounting and keeping the portal updated with energy/water data and building characteristics.

In 2015, we'll begin spotlighting early adopters -- the cities and states already utilizing energy benchmarking programs to reduce energy use, costs, and greenhouse gas emissions. 

If you're a THG Private Label Partner, we'll be in touch with you soon. We'll arrange a private webinar you can use to engage your current and prospective customers. Offer your branded EMS portal to current and future customers to make disclosure compliance a breeze!  We'll also highlight energy efficiency incentives available in these markets: 

Chicago, Boston, Minneapolis, Philadelphia, San Francisco, Washington State, Seattle, NYC, DC, Austin, State of California, State of Texas, Montgomery County, MD 

Check out the Compliance Reporting section of our website for more information.

Can't think of what to get your loved ones for Christmas this year?  How about access to your favorite past editions of our monthly newsletters?  They make great stocking stuffers!  Organized by month, each newsletter is now available as a downloadable PDF file . 

Click here to access.