Smart Building Technology Supports Corporate, Municipal Policy Goals
Jones Lang LaSalle’s report, “The Changing Face of Smart Buildings: The Op-Ex Advantage,” finds that smart buildings generate profound reductions in a building’s energy consumption, which in turn supports corporate and municipal policy goals. The report highlights four findings:
Impact #1: Reduction in Energy Use
The report cites a 2012 study published by the Rockefeller Foundation and Deutsche Bank Group’s DB Climate Change Advisors, estimating that $289 billion in building efficiency investments would produce savings in excess of $1 trillion in the United States alone, with every dollar invested in energy efficiency producing three dollars of operational savings. Smart building technology requires low upfront investment and can generate energy savings of 8-15 percent annually almost immediately after deployment, with the potential for incremental improvements over time.
Impact #2: More Data, More Energy-Use Disclosure
JLL’s report predicts that cities will drive smart building efficiency regulations. Eight major US cities, including Boston, New York and Philadelphia, have established building energy benchmarking ordinances requiring thousands of commercial, residential and municipal buildings to track, verify and publicly report their energy consumption. New York City’s suite of energy efficiency ordinances and laws is expected to generate net savings of $7 billion over 10 years.
Impact #3: CSR Benchmarking Improvement
Energy efficiency directly improves a company’s corporate social responsibility (CSR) profile. Redirecting energy spend to building efficiency has allowed some corporate decision-makers to gain the reputational advantages of doing the right thing by the environment while also gaining significant performance and productivity improvements.
Impact #4: Improved Investment ROI
Relative to other energy-related building upgrades, smart building technology requires little upfront capital expenditure and smart buildings generally cost less to operate than buildings operating solely on legacy systems, therefore offering a long-term reduction in operating expenses. Also driving the fast payback is the low cost of automated building technology, which has fallen as adaptation has increased. For example, intelligent lighting components that cost $120 four years ago today sell for just $50.
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