Retrofit Chicago Provides Road Maps for More Efficient Buildings
In June 2012, the City of Chicago and a consortium of public, private, utility, and non-profit partners launched Retrofit Chicago, an initiative to encourage, support, and recognize voluntary energy efficiency leadership in residential, commercial, institutional, and municipal buildings throughout the city. The Retrofit Chicago Energy Challenge is a primary component of the initiative, and includes a public commitment for large commercial, institutional, or residential properties to reduce energy use by at least 20 percent within five years of joining the program. To facilitate participants’ progress toward meeting their Energy Challenge commitment, Chicago leveraged public-private partnerships to deliver customized Energy Road Maps with technical and strategic recommendations aimed at maximizing internal rate of return (IRR) and utility incentives.
In partnership with Energy Impact Illinois (EI2) and the U.S. Department of Energy (DOE), Retrofit Chicago and the Chicago Metropolitan Agency for Planning (CMAP) provided free technical Energy Road Maps to 19 private building owners to help identify the impact of previous energy efforts, assess projected impact of planned efforts, and identify additional energy conservation opportunities. Typically valued at $20,000-$30,000, these Energy Road Maps included energy audits with financials, taking into consideration building budgets and timelines, and were developed in conjunction with utilities to provide custom recommendations leveraging qualifying utility incentives. Chicago’s Energy Road Maps identified an average of 22 percent annual savings potential across buildings associated with 243 facility-specific energy conservation measures (ECM). Implementation of these recommended ECMs has the potential to reach $4.8 million in ongoing annual cost reduction with a 10-year IRR of 11 percent and simple payback of approximately seven years.
The Chicago Climate Action Plan and Sustainable Chicago Action Agenda highlight energy efficiency in existing buildings as a critical component of Chicago’s economic and environmental sustainability. In 2012, Mayor Rahm Emanuel launched Retrofit Chicago, to encourage energy efficiency leadership in public and private buildings throughout the city of Chicago. The Retrofit Chicago Energy Challenge – which recognizes large buildings’ commitment to 20 percent whole-building energy use reduction – is a key component of this initiative. Through the Energy Challenge, participants receive incentives, resources, technical support, and peer learning opportunities to help them achieve energy goals, reduce operating expenses, increase asset value, and receive public recognition for energy efficiency leadership.
Since 2012, when Mayor Emanuel and former U.S. Secretary of Energy Dr. Steven Chu announced the Energy Challenge (previously known as Retrofit Chicago’s Commercial Buildings Initiative), the program has expanded four-fold to include 76 buildings that span over 51 million square feet. As of July 2016, program participants reduced energy use by nearly 12 percent, generating annual savings of $6.4 million.
Energy efficiency in large buildings represented an enormous opportunity for energy and cost savings in Chicago. While voluntary and policy-based efforts were increasing transparency and accelerating action on building energy performance, even committed energy efficiency leaders struggled to achieve their energy goals without expert analysis and a practical business case for energy investment. Traditional energy assessments can be costly and fragmented over time and across building systems. Without technical analyses, it is often difficult to prioritize and align energy efficiency opportunities in the context of financial objectives and energy incentives.
In an effort to improve energy performance throughout the city, CMAP received funding through its EI2 program from the American Recovery and Reinvestment Act (ARRA) DOE Block Grant, to invest in tools that help users identify energy efficiency opportunities and accelerate energy retrofits. In collaboration with local engineering and energy services provider PositivEnergy Practice, CMAP developed an online commercial building retrofit assessment tool, EnCompass, which provided an analytical foundation for customized building engagement. The tool, free and publically accessible, allowed building owners and managers to enter information about their facility and energy use to generate customized visualizations of the building’s energy consumption, recommendations about what energy efficiency measures could be taken, and potential financing options.
Retrofit Chicago Energy Challenge participants expressed common interest in obtaining technical support and analysis to inform their efforts to achieve 20 percent whole-building energy use reduction. In 2013, Chicago and CMAP agreed to expand the reach and application of the EnCompass tool by providing customized, direct support to 19 of Retrofit Chicago’s Energy Challenge participants, spanning approximately 18 million square feet. CMAP engaged local engineering and energy service companies to conduct energy audits, similar to ASHRAE Level 1 standards, and develop building-specific Energy Road Maps using the EnCompass platform. Program partners sought to provide participating buildings with actionable economic and energy analysis, including specific steps on how to prioritize, sequence, and implement energy efficiency measures. From May through December 2013, the Energy Road Map team, comprised of the city of Chicago, C40, CMAP, PositivEnergy Practice, Sieben Energy Associates, ComEd, and Peoples Gas, developed the Energy Road Maps with extensive involvement and input from building engineers, owners, and managers. Resulting plans identified actions to achieve 20 percent energy reduction that focused on efficient engineering and creating the business case for improvements. Each Energy Road Map provided technical assistance worth approximately $25,000.
Development of individual facility Energy Road Maps included the following steps:
- Management Kickoff: Initial meeting among building management, engineering and operations staff, and Retrofit Chicago partners, including local nonprofits and PositivEnergy Practice, to confirm Energy Road Map goals, processes, data inputs and other requirements, and workplan. Prior to and during the kickoff, building staff completed the management and technical questionnaires.
- Site Visits & Data Collection: Retrofit Chicago team engineers conducted initial building reviews during and after the management kickoff meeting, followed by up to three site visits to conduct energy audits, similar to ASHRAE Level 1 standards, gather data, and identify facility-specific ECMs.
- ECM Analysis: Informed by site visits and additional input from building management and utility partners, the Energy Road Map team calculated potential energy savings, investment, incentive funding, return on investment, and payback periods for specific ECMs. These efforts drew on the EnCompass analytical platform, into which the Retrofit Chicago engineers entered building-specific information.
- Initial Recommendation Review, Discussion, and Input: The Retrofit Chicago team met with building management and operations stakeholders to review initial ECMs, which were refined according to building representatives’ input.
- Revision, Prioritization, and Sequencing of Recommendations: Based on the initial review input, the Energy Road Map team revised initial calculations incorporating building engineer recommendations and vendor and service provider input. Building representatives also shared insight on capital plans that then influenced final Energy Road Map recommendations.
- Final Review & Energy Road Map Presentation: In a final Energy Road Map review with building management and ownership representatives, Retrofit Chicago participants presented final energy conservation recommendations, economic modeling, and detailed workplans with implementation steps, contact information, and project timelines.
One of the most critical components to the success of the Energy Road Maps was the Initial Recommendation Review, Discussion, and Input meeting. This form of stakeholder engagement invited collaboration among building owners, management, third-party technical experts, and other program partners. Despite the logistical and administrative burden of setting up meetings, the value of having all stakeholders in one room together was immeasurable. The extensive efforts dedicated to creating the Energy Road Maps strengthened the trust between partners and encouraged increased engagement from all parties. Building representatives often provided suggestions and shared additional information, such as other reports or contractor proposals. In many cases, the management was able to shed light on capital budget plans that influenced the timing of several measures. For instance, if a building already had certain remodel plans in place, that could help prioritize project implementation. This knowledge allowed Energy Road Map engineers to sequence recommendations based on the building’s financial planning, including any changes to building tenancy and ownership, all while reaching or exceeding 20 percent energy reduction within the five-year timeframe.
Additionally, utility companies were key strategic partners in providing support and identifying incentives. To-date, program participants have received millions of dollars in energy utility incentive funding through ComEd and Peoples Gas to support efficiency improvements. To support the Energy Road Map effort, energy utilities provided direct support and energy conservation impact analysis to inform business cases for energy improvements. Utility partners also ensured that Energy Road Maps appropriately leveraged efficiency incentives for each specific energy conservation measure.
EnCompass: Retrofit Chicago Energy Road Maps leveraged ARRA funding to design a tool to inform commercial and institutional buildings greater than 300,000 square feet about energy efficiency opportunities. The primary function of the EnCompass tool allowed building owners and managers to enter information about their current energy usage and receive customized feedback that included conceptual visualizations of the building’s energy consumption, recommendations about what energy efficiency measures could be taken, and potential financing options. The tool was developed by PositivEnergy Practice through the EI2 commercial building energy efficiency effort. The outcome was an online energy resource for use by commercial building owners and managers, peer comparisons of buildings throughout the Chicago region, and automatically-generated building retrofit recommendations based on facility-specific inputs.
Findings and ECM Analysis:
- To date, two buildings exceeded the 20 percent reduction target and another 11 buildings made progress toward the target.
- Energy Road Maps identified average building-level energy savings potential of 20 percent, compared with individual building baseline energy use. For most participating buildings, baseline years were typically January through December 2010.
- Energy Road Map ECMs, if undertaken, would require $32.9 million in capital investment – after utility incentives – and would yield approximately $4.8 million in total annual cost savings, with a net present value (NPV) of $3.4 million.
- Heating, ventilation, and air conditioning (HVAC) measures accounted for over half (53 percent) of all savings identified by the Energy Road Maps. They were also most common, occurring in 18 out of 19 Energy Road Maps.
- Lighting measures were split up into interior, exterior, and LED exit signs. Interior lighting made up the majority of lighting retrofits both in number and in savings, while exterior lighting measures and exit signs had lower savings, negative IRR and NPV, and almost four times the payback period.
Table 1. Average building-level energy savings opportunity, investment requirement, and estimated savings potential (based on individual Energy Road Maps for 19 facilities within the city of Chicago)
Table 2. Average impact of recommended ECMs
Aggregating individual building ECMs, Retrofit Chicago calculated average impact of specific types of measures, including building automation systems (BAS) and controls, HVAC, lighting, and other. (Note: most buildings had multiple recommended measures of each type.)
Table 3. Average impact of recommended ECMs
Through its Energy Challenge, Retrofit Chicago leveraged public-private partnerships to deliver building owners customized Energy Road Maps with valuable strategic and tactical recommendations to help them meet a 20% energy reduction commitment. On average, the Road Maps identified opportunities for each building to cut energy use by 22%, for an annual savings of $254,000.
To facilitate building owners’ commitment to reducing whole-building energy use intensity by 20% within five years
Lack of organization-wide interest to support energy investment and lack of expertise on cost-effective energy efficiency upgrades and improvements
Retrofit Chicago leveraged public-private partnerships to deliver building owners customized Energy Road Maps with strategic and tactical recommendations to meet their 20% energy reduction commitment while maximizing internal rate of return and utility incentives.
Nineteen buildings received actionable Energy Road Maps including technical assistance worth $25,000. On average, the Road Maps identified opportunities for 22% total energy savings and $254,000 annual cost savings.