Currently, commercial mortgage underwriting, valuation, and asset management practices are not fully accounting for energy factors and the impact of energy costs on net operating income. This discrepancy results in energy-efficient, high-performance buildings being improperly valued and energy risks that are not properly assessed and mitigated. By leveraging commercial mortgages, effective energy risk assessment, and mitigation via energy efficiency, Better Buildings Partners can tap into an important channel for scaling energy efficiency investments and reducing risk within their portfolio.
This project aims to create a foundation for which scalable interventions can be developed to improve commercial mortgage underwriting and risk mitigation. The project is sponsored by the U.S. Department of Energy’s Building Technologies Office and is led by Lawrence Berkeley National Laboratory (LBNL) in collaboration with the University of California Berkeley’s Haas School of Business and the Institute for Market Transformation (IMT). The analysis developed for this project uses a unique method of merging and matching building-level energy data, benchmarking disclosure data, energy price data, and commercial mortgage loan data.