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Energy Efficiency Indicator

2010 Energy Efficiency Indicator Results for North America

Planned efficiency investments rebound, motivated by pressure to cut costs, enhance public image, and reduce carbon emissions.

During March of 2010, Johnson Controls partnered with the International Facility Management Association (IFMA) and the American Society for Healthcare Engineering (ASHE) to conduct the North America Energy Efficiency Indicator (EEI) survey of more than 1,400 decision makers responsible for managing energy use within commercial buildings across North America.

In its fourth consecutive year, the EEI survey examines the attitudes, practices, investment plans, and expected return-on-investment for energy management initiatives among decision makers in commercial buildings. Comparing results to those from prior years provides an outlook on energy management trends and provides insight into how events from the past year have impacted energy efficiency activities.

 

Results Summary

Rebounding from a 2009 drop, planned spending on energy efficiency across North America is expected to increase nearly to 2008 levels, motivated primarily by cost reduction, brand differentiation, government/utility incentives, and climate change concerns. Leaders expect energy prices to climb during 2010, and say improving energy efficiency in buildings is their most important carbon management strategy. While enthusiasm for and attention to energy efficiency remains high, business leaders say capital availability remains the greatest barrier to implementing projects that result in energy savings.

 

Respondent Profile

EEI respondant profile chart
 

The 2010 EEI survey was completed by a total of 1,435 respondents across North America. Those surveyed this year included c-level executives (28%), vice presidents and general managers (30%), and facility managers (25%) from organizations large and small across a variety of industry sectors. The highest number of respondents this year came from the health care (20%), consulting/legal services (9%), manufacturing (7%), financial services (7%), government (6%), and retail trade (5%) sectors. 90% were from the private sector and 10% were from the public sector.

Respondents came from nearly all regions throughout North America. 60% of organizations surveyed spend more than $100,000 US dollars per year for energy (e.g. electricity, natural gas, and fuel oil) to power their facilities.

 

Detailed Findings

Despite a small dip since 2009, energy efficiency remains a strong business priority.

  • 65% are paying more attention to energy efficiency than they were one year ago.

  • 52% continue to say that energy management is very or extremely important.

  • Energy efficiency is a priority for 84% in planned new construction and retrofit projects.

Capital and operating spending on energy efficiency will increase in 2010. The economic recession has had a very mixed impact on energy efficiency investment.

  • 52% (up from 46% in 2009) plan to make capital investments in energy efficiency improvements.

  • 60% (up from 55%) plan to make operating budget investments in energy efficiency measures.

  • Large organizations are nearly three times as likely to make capital investments compared with small organizations.

  • 22% (up from 16%) are undergoing new construction in the next year.

  • 30% (up from 22%) are undergoing or planning retrofits.

  • Over the last 12 months, 41% have invested less in energy efficiency, 27% have invested at historically consistent levels, and 32% have invested more as a result of the recession.

EEI Trends Energy Efficiency Investment

Access to capital constrains many organizations from making efficiency investments, suggesting the importance of new financing models.

  • The three largest barriers to capturing potential energy savings are limited capital availability (38%), insufficient payback (21%), and savings uncertainty (16%).

  • 44% require a simple payback of three years or less, consistent with responses from 2009 and 2008 (44% and 43%, respectively).

Trends in energy efficiency payback expectations

The factors cited as at least somewhat significant in energy efficiency decision making are:

  1. Energy cost savings (97%)

  2. Enhanced brand/public image (63%)

  3. Government/utility incentives (62%)

  4. Greenhouse gas emissions reduction (62%)

  5. Customer attraction (56%)

  6. Pending/anticipated regulation (52%)

  7. Existing legislation (51%)

  8. Attracting/retaining talented employees (38%)

  9. Investor reporting (34%)

  10. Attracting tenants (25%) (this factor was not applicable to 57% of respondents)

EEI factors driving efficient investments

Executives believe energy prices will climb again in 2010 after falling in 2009.

  • 64% believe that natural gas and electricity prices will rise over the next twelve months.

  • 28% do not expect prices to change significantly.

  • On average, respondents expect a 7% increase in the combined price of energy over the next twelve months.

Climate legislation is expected and is viewed as both a risk and an opportunity.

  • 75% think legislation mandating energy efficiency and/or carbon reduction is likely within the next two years, compared to 85% in 2009 and 76% in 2008.

  • 46% view climate change legislation equally as a risk and as a growth opportunity for their organization, while 39% view it as more of a risk, and 16% view it as more of an opportunity.

Building efficiency is the top priority for those seeking to decrease their carbon footprint.

 

Carbon management strategies
  • 14% have made public carbon reduction commitments, up from 12% in 2009.

  • 40% of respondents have don’t know or have not yet prioritized strategies for reducing their organization’s greenhouse gas emissions.

  • 38% say improving energy efficiency in buildings is their top emission reduction strategy, which was selected by eight times more respondents than the next most popular strategy.

  • Other top strategies include virtual workplace/telecommuting (8%), installing onsite renewable energy (7%), purchasing renewable energy (7%), and improving vehicle fleet efficiency (5%).

  • Only 3% said purchasing carbon offsets was one of their top six strategies.

Lighting retrofits were the most popular energy efficiency measure over the last 12 months.

  • 72% switched to energy efficient lighting, 40% installed occupancy or daylight sensors.

  • Other popular measures implemented include facilities staff education (63%), occupant engagement (61%), set point adjustments (56%), upgrading building controls (33%), and installing variable speed drives (25%)--all low capital cost measures.

Interest in green building certification remains strong, particularly for new buildings.

  • 12% have at least one certified green building, up from 8% in 2009.

  • 33% are targeting green building certification for new construction projects.

  • 85% seek to at least incorporate some green elements.

  • 18% are seeking to certify building retrofit projects to a recognized green standard, up from 17% in 2009.

Fewer respondents are considering renewable technologies in construction projects.

  • Solar photovoltaic (PV) and solar thermal are the onsite renewable energy technologies considered most often in new construction or retrofit projects.

  • A drop in consideration levels was seen across all renewable technologies. Specific technologies building owners are considering for new construction and retrofit projects include solar electric (31%, down from 46% in 2009), solar thermal (20%, down from 27%), wind (13%, down from 21%), and geothermal (14%, down from 20%).

Leaders predict the greatest technological improvement in lighting and smart building technologies over the next 10 years.

  • When asked to select three technologies with the greatest expected improvement in performance-to-price ratio over the next ten years, respondents selected lighting (51%) and smart building (44%) as the top two. Next came solar photovoltaic systems (38%), electric and plug-in hybrid vehicles (28%), nuclear power (22%), stationary energy storage (6%), and carbon capture and sequestration technology (3%).

Technology performance & price improvement expectations chart

November 2010

Related Articles:
2012 EEI: Executive Summary of Global Results >>
2011 Energy Efficiency Indicator Global Survey Results >>
2007-2009 EEI Introduction to Energy Efficiency Indicator >>





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