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Energy Benchmarking

In this Field Guide, we introduce and explain four types of energy benchmarking and illustrate ways in which benchmarking can produce a rapid payback. We list multiple energy benchmarking tools that are available to facility and energy managers and rely on the application we know best–our own EnergyCAP utility bill accounting & energy management software—to cite specific ways benchmarking can help you reduce energy consumption and cost.

4 Types of Energy Benchmarking

The key to effective energy benchmarking is finding and selecting an appropriate peer group that will most clearly highlight energy issues and opportunities. Let’s look briefly at four types of energy benchmarking. You can determine which might be the most helpful to you.

1. UTILITY COMPANY REPORTS

The first benchmarking category is reports provided by your utility provider. These periodic (usually monthly) reports demonstrate how your energy use compares to other customers with the same provider. These types of reports can often serve as a broad indicator of the relative efficiency of your building. Plus, you receive them for free.

Unfortunately, utility-provided reports might not account for variables relating to your energy use. Without submetering, the report might lack needed granularity. It might contain multiple estimated bills. The benchmarking energy data might simply be raw calculations using the meter reading and multiplier for billing periods of varying lengths.

These types of reports may spur helpful questions but seldom supply useful answers and are generally not actionable.

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2. ENERGY STAR RATINGS

The second category of benchmarking reports is ENERGY STAR ratings. ENERGY STAR is probably the best-known building benchmarking system. It is widely used, and ENERGYSTAR.gov claims that “more than 90% of American households recognize the ENERGY STAR.”

ENERGY STAR uses its Portfolio Manager application to measure building energy efficiency on a 100-point scale that adjusts for a variety of building types. By defining your building type and related characteristics, and by entering your building utility bill data into Portfolio Manager, you can obtain a benchmarking comparison with closely matched peer buildings in your geographical region. A favorable benchmarking score (75 or above) grants you eligibility to pursue official ENERGY STAR certification, including a plaque for your building.

Note that, even if your building matches one of the definitions, there might be some things that you do in your building that make your building unique in its peer group. ENERGY STAR might not be able to fully account for that type of use. This might make your rating lower, and there is little you can do about it.


estarLogoENERGY STAR building ratings can be obtained for 80 property types within 18 categories:
  • Banking/Financial
  • Services
  • Education
  • Entertainment/Public
  • Assembly
  • Food Sales & Service
  • Healthcare
  • Lodging/Residential
  • Manufacturing/ Industrial
  • Mixed Use
  • Office
  • Parking
  • Public Services
  • Religious Worship
  • Retail
  • Technology/Science
  • Services
  • Utility
  • Warehouse/Storage
  • Other

 

3. INDUSTRY-SPECIFIC BENCHMARKING TOOLS

A third category of benchmarking resources is industry-specific reports and/or databases. In addition to government benchmarking, some industry or trade groups supply their own benchmarks within certain spaces (K12 school system, university, industrial, etc.). Often, industry-related benchmarking systems can be more relevant and specific to your building portfolio, which is good.

The ISO 50001 standard is a general purpose energy efficiency standard that applies to multiple space types. The National Association of Energy Service Companies (NAESCO) provides a variety of energy benchmarking resources to its members. The Association of Energy Engineers (AEE) is a trade association of more than 18,000 professionals worldwide, providing members with a variety of tools and resources for energy benchmarking, including seminars on using the ENERGY STAR benchmarking tool. Individual organizations may also maintain significant benchmarking resources.

Ask your trade association about available energy benchmarking tools and opportunities.

4. SOFTWARE TOOLS

The final category of benchmarking tools/opportunities are those supplied in energy management software. The EnergyCAP utility bill accounting & energy management software’s Groups & Benchmarks feature illustrates several benchmarking characteristics and possibilities:

automaticGroups Automatic Groups: These are “peer” groups of buildings and meters that are automatically created and maintained by the software. Each Auto-Group shares a common characteristic, such as commodity, building primary use, or meter primary use.
manualGroups Manual Groups: These are configured and maintained by the user and may include any number of buildings or meters. Popular groups, for example, include “Top 10” most intensive for energy use, cost, or use/cost per square foot. Custom benchmarking functionality enables benchmarking for industry-specific factors, such as use/cost per enrollment, hours of use, occupied room night, production output, and others. Benchmarking in this manner has several advantages:
  • It simplifies the benchmarking setup process by automating key components.
  • It organizes benchmarking efforts around appropriate energy metrics.
  • It provides flexibility to account for unique situations.
  • It provides a basis for taking energy management actions.

Internal benchmarking may have limitations, especially if your organization is relatively small. Suppose, for instance, that you have two buildings that are benchmarking at the same level in EnergyCAP using use and cost metrics. You might assume that neither building has a problem because of their similarity. However, there could be problems in both buildings. They could have been designed poorly. If the buildings are just about the same age, they might both have very inefficient mechanical systems that are heating and cooling at the same time. You might miss this unless you are comparing with a larger set of peer buildings.

That is where a tool like ENERGY STAR can be very helpful. Your two buildings may look good to you based on several internal peer benchmarking metrics, but what happens when you run the ENERGY STAR comparison? A poor rating using this “external” review may reveal that both of your buildings merit a closer look.

Three Keys of Benchmarking for Payback

Benchmarking can deliver significant payback if it’s done right. Here are four keys to effective energy benchmarking. We’ll use EnergyCAP benchmarking charts for examples.

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KEY 1: DEFINE CLOSELY MATCHED PEER GROUPS

The first key is to define closely matched peer groups. It doesn’t make any sense to benchmark a fire station with a library, even if they were built in the same year. This example (below) demonstrates a thoughtful approach to benchmarking municipal buildings based on building types and functions.

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KEY 2: PRIORITIZE BENCHMARKING EFFORTS

A second key is to prioritize benchmarking efforts based on the probable return for your investment of time and money. In this example (below), a scatterplot presents buildings’ total annual costs versus cost per area. Points that are highest on the Y-axis represent the buildings with the highest total annual cost, and the rightmost points represent buildings with the highest cost per area. Since the building on the far right is low on the Y-axis, we know that improvements to this building will have a relatively low benefit compared with other building options. Viewing the data in this format allows us to select candidates for improvements based not only on individual performance, but the relative magnitude of savings, ensuring the greatest bang for our buck.

KEY 3: USE CORRECT BENCHMARK METRICS

The third key is to use benchmark metrics most likely to reveal energy issues. We could create a peer group for brick buildings and another peer group for steel and glass buildings, but we might quickly discover that external construction materials are not a very helpful or actionable indicator of energy efficiency. Building primary use (school, firehouse, dormitory, etc.) is a much more reliable energy benchmarking metric for a peer group.

Helpful Benchmarking Metrics

Once you have grouped similar facilities together for benchmarking, the next step is to compare them with each other using the most revealing energy metrics. Following are several benchmarking metrics that are particularly useful for spotting opportunities and issues with your facilities.

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ANNUALIZED COST PER AREA

In the first benchmarking chart (below), the blue bars represent annualized costs per square foot. All buildings in the group are libraries. Cost per area is determined by dividing the total energy costs for the benchmarking period by the square footage for the buildings associated with the included meters.

The facility at the top of the list is averaging $3.77 per square foot— more than double the group median of $1.37. Should this building occupy our attention and effort? Not necessarily. As total cost bar on the right indicates, total spending for the facility is only about $52,027 a year. However, the peer facility in the number four position is averaging $2.05 per square foot per year. And the associated energy spend is more than $125,000. This fourth facility presents a more significant savings opportunity than the facility in the first position.

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PEAK DEMAND

The next chart (below) illustrates the benchmarking principle using peak electric demand as the comparison metric.

In this example, the peer buildings have similar equipment in them. Presumably they have the same kind of lighting. Why, then, does one building require 8.6 watts per square foot of peak demand when the median is less than 4 watts per square foot of peak demand? The most likely assumption is that the building offers controllable loads that are not being controlled. As a result, peak demand penalties may be driving up the utility costs. This is very good actionable information, gained from analysis of well-defined peer groups using appropriate metrics.

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CUSTOM FACTORS

In addition to capabilities to benchmark cost, use, and by area or time, EnergyCAP provides the flexibility to define custom benchmarks. Custom benchmarks provide a virtually unlimited capability to compare cost and use factors with variables like occupancy, enrollment, hours of operation, number of visitors, and units of production.

Custom benchmarking provides answers to questions like, “What is our utility cost per resident?” “How much energy is required to produce a unit of our product?” “How much do we spend per business hour?” “How is utility use and cost related to occupancy?”

In the example (right), our annual utility cost is displayed per student enrolled so that we may compare performance among school buildings.

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COST/DAY

The next example (below) is a meter-based peer group. The chart is displaying cost per day. These are the five most expensive meters in the organization, so this chart will demand the energy manager’s monthly attention due solely to the magnitude of the energy spend. Benchmarking helps make this data quickly available.

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USE/DAY

The following chart (below) is another meter-based chart, but the metric is use per day. Again, these group members are the most expensive meters in the organization, but from a consumption perspective. If we were considering various energy conservation strategies, these are the meters we would look at most closely.

Filtering Out the Noise

A final key to effective benchmarking is to filter out the noise in your benchmarking process. A good benchmarking system is one that allows you to quickly focus on the opportunities that offer the greatest return on your investment.

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The next chart (below) is a simple unit cost analysis. The chart is ranking each included meter by unit cost.

The unit cost for the worst meter has been calculated at a significant $1.534/THERM, three times the average unit cost. But when we look at Total Cost, we see that we have only spent $658 all year. It’s simply not worth our attention. It’s helpful to find a benchmarking system where it’s easy to separate the wheat from the chaff—to quickly recognize and exclude places and meters that do not offer a significant energy management ROI.

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In this final example (below), we are only benchmarking the electric meters that have the same rate code and vendor. Peer meters are being ranked by unit cost.

We would expect that if these meters are all on the same rate schedule with the same vendor, then the average cost per kilowatt hour would be identical for each. But as you can see, the unit cost for the top building is almost 17 cents, and we are spending $7,500 for it every year.

Several other meters in this chart are averaging well above the peer average of about 11 cents per kilowatt hour. Time to investigate! This benchmarking chart, manually created using rate schedule as a filter, can be very revealing.

As you can see, effective benchmarking can lead to actionable energy management insights. We encourage you to find effective ways to benchmark your organization’s energy use.