Energy Alliance Connects R&D with End Users
DOE and real estate industry compare notes

by Layla Bellows

Summary: The biggest names in commercial real estate have joined forces with the Department of Energy to form the Commercial Real Estate Energy Alliance. The group aims to improve communication among developers, producers, and consumers in the energy-efficiency marketplace and drive new technology that will satisfy market needs.

In the world of commercial real estate, there’s nothing really new about the phrase energy efficient.

“Energy is the number one controlled cost in a building,” explains Henry Chamberlain, president and COO of Building Owners and Managers Association International. “It is the most important thing people are wrestling with on a regular basis if they’re trying to drive performance. And in this economy, a high-performance building is going to retain more value.”

What is new is the Commercial Real Estate Energy Alliance (CREEA), a partnership between commercial real estate companies and the U.S. Department of Energy (DOE) in which the two will work together to identify ways to reduce energy use in commercial buildings. It’s a marriage of the industry’s age-old desire to create more efficient buildings and the more contemporary commitment to creating more sustainable commercial structures, as demonstrated by BOMA’s goal of reducing energy use 30 percent by 2012 and DOE’s goal to create net-zero buildings by 2025. (DOE and the AIA are working together to ensure that CREEA uses the expertise of architects.)

Building bridges
Communication between research, technology, and end users is the name of the game for CREEA. There has always been a gap between producers and consumers in that it typically takes time for a new piece of technology to take hold in the market. Yet, when your market consists of owners of multi-million dollar buildings, there’s a new level of risk that makes owners and consumers even more conservative when considering adopting new technology.

“As we were talking to the organizations, we were finding that they already had a lot of knowledge, but they weren’t sharing it with each other,” says the DOE’s Dru Crawley, who was instrumental in putting together the alliance. Competition or other business concerns weren’t driving the lack of communication—it was simply that there wasn’t an existing pathway for it to take place. CREEA brings together not just the real estate executives who make recommendations for sustainability upgrades to the building owners, but also the companies that manufacture the technology and the researchers who develop and test it.

“There are vendors out there trying to create products that did not fit the mold of what the ownerships and the real estate organizations required,” says John Scott, director of client solutions at Cushman & Wakefield, “and the communication is actually bridging the gap between our needs and their research and development.”

Diane Vrkic, the COO of global energy and sustainability services practice at Jones Lang LaSalle points to CREEA’s planned supplier summits as one example of how the alliance will lower the communication barriers that currently exist within the industry. These summits offer a chance for vendors in the marketplace to speak directly with the service suppliers and understand more of their needs.

“Hopefully the vendors will take that back and work to develop the appropriate technologies at a lower price point, which will allow for greater adoption in the real estate industry,” she says.

Although still in its infancy, the alliance already has plans for future communication growth. Cushman & Wakefield’s Scott explains that CREEA will soon start subcommittees that focus on different areas of the industry and sustainability.

“As a part of that, we’re going to bring in new members, which will include architects and engineers,” he says. “We have their involvement in the process first off to get their ideas, second off to figure out how to market it to their disciplines specifically and how we can take that out to the marketplace.”

Better, smarter, faster
All of this increased communication isn’t just going to be beneficial for getting existing solutions to the marketplace, as Vrkic and Scott both indicate—it’s designed to help create better solutions that will be able to penetrate the market faster. It all adds up to making the net-zero by 2025 goal more likely to be met.

Dave Pogue, the national director of sustainability for institutional and corporate services at CB Richard Ellis, says the way technology is currently introduced to the commercial real estate marketplace is a cautious process that helps abate potential risk.

“Generally, what we might do is beta test on a couple of buildings,” he says, but the beta test adds time to the process. “I think that’s what DOE is looking for in the near term: speed to market. They’d like to compress the time frame from good idea to application to broad application of programs and systems and the like.”

Not only will the better-cemented relationship with the DOE’s research labs help ease consumer concerns about adopting new efficiency measures, but it will also help create ideas for technology that might not have otherwise existed or put in place technology that will vastly change the marketplace.

Pogue says part of the process is just demonstrating existing needs to product developers who might not have otherwise thought of them, “so that people are developing and designing to meet an identified need, not an imagined need.”

What most people say they’re looking forward to seeing is game-changing technology that will have a seemingly global impact on energy efficiency. The example most point to is the adoption of LED lighting in parking lots and garages. Energy and maintenance costs for them are about 70 percent less than what’s being used, and if hotels, shopping centers, office towers, and other commercial structures all adopted them, it would make a big dent in energy consumption.

This kind of idea and application is what excites CREEA participants. It’s not just about getting people together in the same room to sell and buy things, it’s about getting challenges and solutions together that can have a big impact on the market.