Survey: What Will It Take to Make Buildings More Energy Efficient?

Elisa Wood
October 22, 2012 | 2 Comments

In 2010, China built more housing than Spain has homes. That factoid underscores the significance of energy efficiency for buildings in a report released this week by an affiliate of the respected publication, The Economist.

Commissioned by the Global Buildings Performance Network, the report emerged from a survey of real estate and construction executives in the European Union, India, China and the U.S.

It offered promising news: The right policy signals could unleash an international boom in energy efficiency.

What motivates these professionals? Not surprisingly, it’s the potential they see to cut costs. They “are ready to go deep and are waiting for the right policy signals that can scale up energy efficiency in the sector,” said GBPN in the report.

Although barriers exist, business leaders in building and real estate already are pursuing a range of efficiency measures. The survey found that:

Energy usage is important for most of the companies and is key factor in investment decisions to 63 percent of those surveyed. Companies that describe themselves as “financially successful” rated energy particularly high.
Lighting retrofits scored high among actions companies are taking. About 57 percent are replacing lighting , 50 percent HVAC systems and 50 percent building insulation.
Forty percent are reconfiguring building layout to take advantage of natural light.
Energy efficiency is a risk management tool for 69 percent, a sign that they have a sophisticated understanding of energy.

Not all of the news was good, however. Companies are unaware of the actual costs of their energy use. Less than a third have commissioned energy audits for their buildings. Further, two thirds of those surveyed overestimate the cost of energy efficient construction.

A surprising 75 percent saw benefit in energy regulation and described lack of enforcement as a problem. The solution? Not too much carrot and not too much stick, concluded the survey report.

“While the survey shows that most companies prefer carrots, at some point governments also need to wield the stick,” the report said. “Striking the right balance between incentives and restrictions is not easy. Excessive red tape and mixed messages are costly to business and slow the adoption of more efficient technologies. The market needs clear long-term signals, rational expectations and opportunities for a reasonable return on investment.”

The Economist Intelligence Unit surveyed 423 senior executives from the real estate and construction industries in the summer 2012. About 27 percent of those surveyed came from the US, 24 percent from the European Union, 25 percent from China and 24 percent from India. All of those surveyed worked in operations, strategy or finance. More than half were C-level executives or above and nearly half from businesses with more than $500 million in global annual revenue. The full report, “Energy Efficiency and Energy Savings: A View from the Building Sector,” is available for download here.

Elisa Wood is a long-time energy writer. See more of her work at RealEnergyWriters.com.

Lead image: Green building via Shutterstock

The information and views expressed in this blog post are solely those of the author and not necessarily those of RenewableEnergyWorld.com or the companies that advertise on this Web site and other publications. This blog was posted directly by the author and was not reviewed for accuracy, spelling or grammar.

2 Comments

Mike Kaplan
October 26, 2012

Great article. One additional finding from the report is that most companies focus on energy efficiency opportunities in newly constructed buildings. However, in the U.S. (for example), existing buildings account for 40%+ of the nation's energy consumption. Why are companies unable to tap this huge opportunity within their existing building stock? The answer is largely that today's approach to evaluating where the best energy efficiency opportunities is not scalable, particularly over a large portfolio of buildings. This is quickly changing however. Emerging energy analytics software products like Retroficiency's can analyze energy consumption or building asset data to determine opportunities in minutes, instead of weeks and months.

Christopher Lee
October 23, 2012

Mildly stated: depending on the subject, 25 to 50 percent of the industry executives don't give much of a damn, whereas a very large percentage of scientifically-informed end-users are very worried about a possible grave global warming catastrophy on the timescale of their children's lifetimes.

It's a difficult subject to discuss, knowing the home base of REW, but there does need to be tight regulation with effective inspection, and the suppliers of non-renewabble energy need to be placed in a situation where the more they sell the more they lose. Instead, we learned the other day that an American energy utility can legitimately levy a dissuasive tax on domestic photovoltaic systems, and not too many people objected.

Finally, it would have been surprising if any of these building-company executives were to have any idea of the nature of innovation. Optimising the orientation of buildings was mentioned, but there was not a word about energy-expensive air conditioning, nor about using "intelligent" wall cladding that lets heat in and out as required.

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Elisa Wood

Elisa Wood is a long-time energy writer whose work appears in many of the industry's top magazines and newsletters. Her blog on energy efficiency appears on more than 100 sites and has been picked up by the New York Times and Reuters. She...