Tag Archives: Energy Audit

Upcoming ASTM E2797-2011 BEPA (Building Energy Performance Assessment) Standard

The draft ASTM E2797-2011 BEPA (Building Energy Performance Assessment) Standard will provide another method to assess and disclose the energy efficiency of commercial buildings. The standard is expected to be published in 2011, though no date has been specified.

BEPA was created in an effort to standardize the process of assessing the energy efficiency of a building for the purposes of pre-transaction disclosure. Building purchasers will want to know the building’s energy consumption, and lenders will want to understand the building’s operating costs.

BEPAs were designed to be conducted in concurrence with a Phase I ESA or PCA; however, BEPA buyers need to be aware that the personnel used for the site inspection during a Phase I or PCA may not be trained appropriately to conduct the BEPA. The inspector for BEPA should be a mechanical or other engineer, Certified Energy Manager (CEM), LEED AP or other professional with training in building and energy systems.

More states are requiring energy efficiency disclosure of commercial buildings. As this trend continues, more building owners, purchasers and commercial real estate professionals are recognizing the value of energy assessments not just because of these regulatory requirements, but because energy efficiency initiatives really work. In addition to greater marketability of a building, capital investments into energy efficient system upgrades will yield substantial return on investment.

According to Tony Liou, President of Partner Energy, the EPA’s Energy Star program is currently the most commonly used energy disclosure and benchmarking tool; however, Partner Energy structures each assessment according to the client’s specifications and the most appropriate method, whether the Energy Star program, ASHRAE audits, or the upcoming BEPA standard.

Partner Energy specializes in an array of energy services including audits, modeling and benchmarking.

Property Condition Report plus Energy Audit

Real estate investors routinely order a Property Condition Report in order to understand the condition of the asset that they are purchasing. The Property Condition Report should illuminate any immediate repairs or deferred maintenance issues and should provide a schedule of capital replacement reserves. But the Property Condition Report only addresses what is broken and what will need to be replaced. What about the opportunity to save money?

An Energy Audit in conjunction with a Property Condition Report will illuminate how a building should be performing. Often the Energy Audit will discover multiple aspects of a buildings energy management program that are suboptimal and can easily be corrected. Energy Audit will also give the user a list of potential energy efficiency investments and will rank these investments in terms of payback period—often several opportunities with sub-3-year payback periods are indentified.

The Energy Audit and Property Condition Report go well together as they are addressing the same systems. The Property Condition Report may schedule the replacement of a roof mounted HVAC system in year 8 of the replacement reserve as that is the end of its useful life; however, the Energy Audit may make a case for not using an old inefficient system until it fails; rather, the building owner may receive an positive return by replacing it sooner.

My company, Partner Engineering Science, and our sister company Partner Energy routinely provide these services in tandem.

Energy Audits

Energy Audits should be a standard part of building due diligence. When you buy a car you know its fuel effiency, why not understand the same about the commercial building that you are buying? Commercial building energy efficency can vary widely. Two building of similar age and construction often vary as much as $1.00 per square foot per year in energy costs.

Of course, the cost of energy is in the operating expense, so why pay $1,000 to $3,000 for an energy audit? What you cannot see in the operating expenses is the opportunity to reduce. Often a poorly preforming building can be brought in-line with its peer buildings for a minimal investment and these savings contribute directly to the building’s Net Operating Income.

In California there is another reason to do it: the results of a basic energy audits will be a required disclosure item duirng leese, sale, and financing transacitons in 2010 for non-residentail buildings per AB 1103. AB 1103 requires that non-commercial buildings are enrolled in EPA’s portfolio manager program and that the 1 to 100 rating given by EPA Portfolio Manager is given to the prespective tenant, buyer, or lender.