Energy Management in Commercial Buildings: Driving Sustainability & Efficiency

Published on 20 Nov, 2023

Energy management for commercial real estate has become necessary in light of the increasing severity of climate emergencies.  Commercial buildings, by nature, utilise 33% of total energy, contributing considerably to global energy consumption and CO2 emissions. The responsibility is on building owners, facility managers, and energy managers to control this usage and reduce it on a daily basis. So what is the way forward? Let's start by understanding energy management for commercial Real Estate buildings and facilities. 

What is Building Energy Management?

Energy management is the process of monitoring, managing, and optimizing the use of energy in a system or facility. Enhancing energy efficiency, cutting energy consumption, and eventually lowering energy costs are the objectives. This process entails taking a methodical approach to understanding, measuring, and controlling the amount of energy used by diverse systems and operations.

It is already too late to overlook energy management in Commercial Real Estate buildings and facilities. In recent years, energy management has become critical not only for governments but also for enterprises. Because of the climate emergency, efforts to reduce carbon emissions and implement regulations pertaining to emissions and operations are proceeding with ever-greater urgency. The need to cut consumption for sustainability and profitability is being driven by the continually rising prices of energy.

The Importance of Energy Management in Commercial Buildings

There are various benefits of energy management in commercial real estate facilities that can improve the bottom line and the environment. Here are a few major benefits:

Cost Savings: Managing energy resources effectively lowers utility costs. Businesses can reduce their expenses on gas, electricity, and water bills by optimising their energy consumption, which also lowers overall costs.

Reducing energy consumption in commercial buildings has a positive impact on the environment by lowering carbon emissions. This complies with sustainability goals and corporate social responsibility, which could strengthen the reputation of the real estate facility.

Identifying Inefficiencies: Through monitoring and analysis, energy management helps identify areas of inefficiency in a facility. This could include outdated equipment, inefficient processes, or unnecessary energy consumption during non-operational hours.

Optimizing Energy Use: Once inefficiencies are identified, energy management strategies can be implemented to optimize energy use. This may involve upgrading equipment to more energy-efficient models, implementing energy-saving technologies, and adjusting operational practices to minimize unnecessary energy consumption.

Compliance and Certification: Many regions have energy efficiency regulations and standards for buildings. Implementing adequate energy management practices assists in regulatory compliance and can lead to certifications such as LEED (Leadership in Energy and Environmental Design), which demonstrate a commitment to sustainability.

Enhanced Tenant Satisfaction: Energy-efficient buildings offer a more comfortable and healthier environment for tenants. This can lead to greater tenant satisfaction, lower tenant turnover, and increased property value.

Increased Asset Value: Energy-efficient buildings are typically more attractive to investors and buyers. An increase in energy efficiency can raise the commercial real estate property's total asset value.

Risk Mitigation: Energy management helps in identifying and reducing risks related to high energy prices and supply. By diversifying energy sources and adopting energy-saving measures, commercial real estate facilities will be more resilient to energy market fluctuations.

Long-Term Planning: Analysing and tracking energy consumption over time yields valuable data. This data can inform decisions regarding equipment upgrades, renovations, and other strategic initiatives that further improve energy efficiency.

Overall, energy management in commercial real estate is a comprehensive strategy that goes beyond just cost savings. It includes strategic positioning in a market that is changing rapidly, tenant satisfaction, and environmental responsibility.

Implementing Energy Management in Commercial Buildings & Facilities

A structured approach is required to implement an efficient energy management strategy for commercial buildings and facilities. Here's a step-by-step guide:

1. Conduct an Energy Audit

  • Start with a comprehensive energy audit to evaluate current energy consumption patterns, identify inefficiencies, and prioritize areas for improvements.
  • Utilise data from utility bills, equipment specifications, and on-site inspections to collect information about energy use.

2. Establish Clear Goals

Set quantifiable, precise goals for energy management. These could include adopting renewable energy sources, achieving certain energy efficiency goals, carbon emission reduction or lowering overall energy consumption.

3. Build an Energy Management Team

  • Create a team specifically for energy management, or assign members of already-existing teams to supervise and carry out the energy management strategy.
  • Make sure the team includes representatives from the facilities management, operations, and finance departments, among other areas.

4. Invest in the Right Technology

Adopt energy management technologies such as smart meters, sensors, and building automation systems. For improved energy consumption control, these technologies offer real-time data and automation capabilities.

5. Adopt Energy-Efficient Practices

Adopt energy-efficient practices in the day-to-day operations. This could entail putting energy-saving lighting solutions into place, optimising HVAC systems, executing data-driven maintenance, and scheduling equipment operation during periods of reduced demand.

6. Continuous Monitoring and Improvement

  • Continuously monitor energy consumption data using the Energy Management technologies.
  • Data analysis can be used to recognise trends, evaluate the success of measures taken, and make data-driven decisions for further optimization.

7. Stay Up to Date with Compliances

  • Stay updated on energy-related rules and specifications that apply to commercial buildings.
  • Ensure compliance with these ESG regulations and take advantage of any benefits or rebates offered for energy efficiency improvements.

Future Trends & Growth Opportunities in Energy Management for Commercial Buildings

Energy management for Commercial Real Estate buildings and facilities has an exciting future ahead of it, with a number of emerging trends and exciting growth opportunities. The energy management market is expected to reach a projected value of US$15.1 billion by 2028, growing at a CAGR of 11.32% between 2022 and 2028 due to the rising number of buildings, residences, and government initiatives.

Here are some key areas to take note of:

Smart Building Technologies

Advanced technological integrations like machine learning, artificial intelligence (AI), and the Internet of Things (IoT) will become more prevalent. Real-time energy monitoring, analysis, and optimization will be possible with the help of smart building systems.

Energy-as-a-Service (EaaS) Models

Energy-as-a-Service models will emerge, allowing enterprises to outsource their energy management needs to specialised providers. This can guarantee optimal energy performance and make the adoption of cutting-edge technologies easier without requiring internal expertise.

Carbon Neutrality & Sustainability Goals

The focus on carbon neutrality and sustainability will lead to increased efforts to reduce overall carbon footprints. Energy management strategies will coincide with broader corporate sustainability goals, drawing in environmentally conscious businesses and investors.

Regulatory Support & Incentives

Governments and regulatory bodies are going to offer increased assistance and incentives for energy efficiency initiatives. Businesses that meet with or exceed energy efficiency standards will benefit from financial rewards and positive regulatory environments.

Data Analytics & Predictive Maintenance

AI-enabled predictive maintenance and advanced data analytics will become standard procedure. These technologies can identify potential equipment breakdowns before they occur, minimizing downtime and enhancing overall energy efficiency.

Collaboration & Partnerships

It will be essential for stakeholders—such as building owners, technology providers, and energy utilities—to work together. Collaborations can result in more all-encompassing and well-rounded solutions that cater to the many requirements of commercial buildings.

Comfort & Well-being of Occupants

Occupant engagement, comfort, and wellness considerations will be progressively integrated into energy management strategies. Smart building technologies will not only optimize energy use but also foster more comfortable and healthier environments for occupants.

These trends demonstrate a rapidly changing landscape for energy management in Commercial Real Estate buildings and facilities, providing growth opportunities for businesses that embrace innovation, sustainability, and efficiency.

In conclusion, energy management for commercial real estate is not only a strategic imperative for cost savings but a journey towards a sustainable and efficient future. By embracing current benefits, implementing robust strategies, and staying ahead of emerging trends, commercial real estate can position itself as a leader in energy efficiency and environmental stewardship.

Proactively manage and reduce energy consumption and costs with Xempla

Gain full visibility into your building’s energy consumption: Get a clear picture of energy KPIs in one location with a simple and easy to use energy dashboard. Access energy consumption, cost, intensity, and carbon footprint insights at asset and site level.

Identify energy consumption patterns and inefficiencies: Never miss out on opportunities to save energy and improve energy performance to better execute your sustainability goals.

Track down and optimize energy guzzling assets: With Xempla’s asset mapping capabilities, help energy managers and FM teams pinpoint and optimize assets or spaces consuming the highest amount of energy, as well as assets that are consuming more energy than they should.

Run proactive energy saving and efficiency programs: Through workflows that alert on potential overuse of energy across assets, enable faster resolution and continued impact. Move closer to your portfolio sustainability and net zero targets by proactively saving energy and boosting your building’s energy performance, one asset at a time.

Ready to level up your building's energy management and maintenance? Book a personalized tour of Xempla or get in touch with our expert today.