Optimizing Warehouses and Distribution Centers for Energy Efficiency and Decarbonization

By Better Buildings Beat Team on Mar 22, 2021

Warehouses and distribution centers are one of the fastest-growing building types in the commercial sector [November 2020]. Due to increased supply needs brought on by the COVID-19 pandemic as well as the ongoing demands of e-commerce, warehouses and distribution centers have become vital to supply chains, distribution networks, and community resilience. They also present an opportunity to decarbonize through the implementation of energy-efficient features such as LED lighting, on-site solar PV, and electric vehicle charging.

During the recent Better Buildings Warehouse and Distribution Center Peer Exchange Call, Better Buildings Challenge partners Qurate Retail Group and USAA Real Estate Company as well as Better Buildings Alliance partner Prologis shared best practices and lessons learned from successful energy efficiency projects in their facilities. Smart financing and efficiency solutions, energy monitoring and optimization, and employee and tenant engagement have helped these partners save energy and money while working toward building a low carbon future for their organizations.

For these partners, identifying energy efficiency opportunities is imperative both during new building construction and when retrofitting existing facilities. Qurate Retail Group is actively working to reduce energy across its 18 global distribution centers (12 of which are in the U.S.) by setting up energy efficiency work groups to pinpoint areas that improve energy efficiency and share best practices globally. Qurate is working to reduce emissions within its existing 12 million-square-foot building portfolio through renewable energy upgrades such as rooftop solar PV installations. Tim Flood, environmental and sustainability manager at Qurate, emphasized that organizations need to ask themselves where, why, and when they’re using energy to best pinpoint efficiency opportunities and optimize savings. By quantifying energy use, optimizing systems, and encouraging efficient behavioral changes among staff, Qurate has secured greater leadership buy-in for its sustainability projects while engaging its 27,000 employees.

As an investor, USAA Real Estate (USAARE) has taken a different approach to efficiency work through green leasing in distribution and logistics centers. Warehouses are ideal buildings for solar given their large roof space, and USAARE is both supporting tenant-driven solar projects where feasible as well as leasing out roof space to solar tenants to generate additional rental income.  This type of partnership strengthens the tenant-landlord relationship and contributes to being the real estate provider of choice for renewals and additional building needs. In some scenarios, a rooftop solar tenant will offer the building and traditional tenants a locked in energy rate through a power purchase agreement to provide energy pricing certainty and a rate below tariff thus creating additional value as well.

As a developer and owner-manager, Prologis uses building standards like LEED® as a baseline in developing highly-efficient buildings. In 2020, it set an ambitious target to have LED lighting coverage across 100% of its operating portfolio by 2025 – by its estimate, an efficiency increase of as much as 70% compared to older forms of warehouse lighting. As Prologis rolls out LED lighting upgrades across its global portfolio, the company is also evaluating renewables and electric vehicle (EV) charging. At the distribution centers and warehouses that Prologis owns, EV charging presents a unique opportunity to stay ahead of what’s next and preempt market demand in EVs, both in new construction projects and facility retrofits.

While each Better Buildings partner has taken a unique approach toward achieving its energy and carbon reduction goals, they have all successfully financed and implemented energy-saving opportunities, monitored and optimized their energy performance, and engaged employees, leadership, and tenants to keep momentum for sustainability work high. See how your organization can do the same with support and resources for warehouse and distribution center building types offered through the Better Buildings Challenge – join today!