Windows on a More Efficient World

In the same month as a dire Intergovernmental Panel on Climate Change that said global greenhouse gas emissions must drop from 2010 levels by 45 percent for the world to meet its Paris Agreement commitments, three reports on energy efficiency offer guideposts. We've scanned their collective hundreds of pages to bring you the nuts and bolts, with a particular focus on transport, buildings & appliances and industry.

On October 19, the International Energy Agency (IEA) released its Energy Efficiency 2018 report, which found that even with policies attempting to tackle the issue, worldwide energy demand rose by 2 percent in 2017. At the same time, the IEA sets out a vision for 2040 called the Efficient World Scenario (EWS), with 60 percent more building space and 20 percent more people, and double global GDP, "while using only marginally more energy than today and cutting greenhouse gas emissions by 12 percent," said an IEA release. "Delivering this vision requires an immediate step up in policy action. For example, countries would need to continue to push up the efficiency of both cars and trucks, building on the progress made in recent years."

Graphs, charts and maps courtesy of IEA

They also need to work on their aviation patterns and aircraft, as well as inefficient air conditioners, the IEA says.

"While various countries are endowed with different energy resources — whether it's oil, gas, wind, solar or hydropower — every single country has energy efficiency potential," said Dr. Fatih Birol, the IEA's executive director. "Efficiency can enable economic growth, reduce emissions and improve energy security. Our study shows that the right efficiency policies could alone enable the world to achieve more than 40 percent of the emissions cuts needed to reach its climate goals without requiring new technology."

A new report from the Urban Land Institute's (ULI) Greenprint Center for Building Performance shows that the commercial real estate industry is making significant progress in reducing energy consumption, carbon emissions, water usage and waste disposal.

Volume 9 of the Greenprint Performance Report, which tracks, benchmarks, and analyzes the performance of nearly 8,000 properties globally owned by Greenprint's members, demonstrates a 3.3-percent reduction in energy consumption, a 3.4-percent reduction in carbon emissions, and a 2.9-percent reduction in water use between 2016 and 2017.

The 7,950 properties owned or managed by Greenprint members included in this report's analyses exceed $760 billion in value (4 percent of the value of high-quality commercial properties globally), are located across 28 countries and account for nearly 2 billion sq. ft. of building area. Greenprint's real estate members include: Berkshire Communities; BlackRock; CalPERS; Clarion Partners; CommonWealth Partners; DWS; First Washington Realty, Inc.; GID; GI Partners; GLL Real Estate Partners; Granite Properties; Heitman; Hines; Howard Hughes; Invesco; Jamestown Properties; Jones Lang LaSalle; Kilroy Realty; LaSalle Investment Management; Morgan Creek Ventures LLC; Parkway Properties; PGIM; Prologis; Rudin Management Company, Inc.; Savanna; Sonae Sierra; Tishman Speyer and The Net Group. 

The results from the new report indicate that Greenprint members are on track to exceed Greenprint's target of a 50-percent emissions reduction by 2030, which is in line with the goals of the IPCC and ratified by the Paris Climate Accord. Examples of best practices include:

• Installation of high efficiency equipment and controls – The most common project in the Greenprint portfolio was the installation of high efficiency HVAC equipment and controls. One example that the report cites is from Tishman Speyer, which installed a chiller replacement and thermal ice storage project at 45 and 50 Rockefeller Center. Energy use dropped by 2.3 million kilowatt-hours, and demand declined by 45 percent from the storage tie-in. The payback on the system took only seven years.
• Waste reduction projects – Greenprint members reported 147 waste-reduction projects, including better understanding the waste streams, new recycling containers to better organize waste rooms, and tenant training on waste. PGIM Real Estate, a Greenprint member, undertook a campaign to replace older trash containers with 105 solar-powered compacting bins. This resulted in an average 23.7 percent recycling rate and a five-year payback, in addition to a 13.3 percent annual return on investment.
• Installation of high-efficiency lighting equipment – High-efficiency lighting in buildings in the Greenprint portfolio was the most effective practice for reducing energy consumption, with a total of 351,553 megawatt-hours in expected annual savings and achieving payback in less than one year.
• Reducing water usage – Efforts to reduce water consumption included the use of green infrastructure systems. For example, at Jamestown's Larkspur Landing Office campus in Larkspur, California, over $1 million was invested to renovate the landscape, including adding drought-tolerant and native plants, along with retrofitting the irrigation system to employ drip irrigation.
• Tenant engagement – Numerous members reported engaging their tenants at a zero-dollar investment. The report states that "tenants who feel engaged, and can see evidence that their space is sustainable, could also be more likely to renew their lease. 

IEA Says Consider Taking the Train

The massive IEA report covers several key areas. Here are highlights covering transport and buildings:

Transport

• Passenger transport energy use increased by 38 percent between 2000 and, driven by a rise in passenger mileage, lower vehicle occupancy and an increasing share of larger cars, which pushed up energy use by 19 percent.
• Mandatory fuel economy standards have been important in boosting the efficiency of road vehicles. "The introduction and strengthening of such standards since 2000 reduced the use of oil for transport in 2017 by nearly 1.2 million barrels of oil per day (mb/d). Another 2.2 mb/d would have been saved had the best-in-class standards been adopted worldwide over that period."
• Freight transport fuel efficiency progress has been more limited. "Higher activity levels and shifts from rail to road freight increased energy use by 65 percent between 2000 and 2017. Vehicle efficiency improvements and shifts towards larger trucks, which carry more load per energy use, had a limited impact, offsetting demand growth by less than 1 percent."
• Canada, China, India, Japan and the United States have adopted fuel efficiency standards for heavy-duty vehicles (HDVs), which account for around 40 percent of total road transport fuel consumption. Those standards covered nearly 50% of global HDV sales in 2017. The European Union has proposed a CO2 emission standard for HDVs, which will deliver efficiency gains.
• The Efficient World Scenario highlights the potential for transport energy demand to remain flat between now and 2040, despite doubling activity levels. "At an end-use level, the average passenger car could be as efficient as today's best hybrids and over 40 percent of the global car fleet could be electrified. The annual rate of efficiency improvement for trucks can rise to 1.5 percent with current and planned policies, but in the Efficient World Scenario, the annual improvement rate could be over 2.5 percent. Non-road transport (aviation and shipping) could see annual efficiency improvements of 3 percent between now and 2040."

Some gains may be realized by choosing high-speed rail over flying, suggests the report, which states, "High-speed rail is currently more than 11 times more energy-efficient on a passenger kilometer basis than aviation (IEA, 2018b). While aviation is the fastest form of transport between destinations, consumers can spend a significant amount of time travelling to and from airports, which are typically outside cities, including passing through lengthy security measures. This means that for short flight distances, high-speed rail is a comparable and more energy efficient travel option in terms of both cost and duration, with trips typically ranging between two and five hours."

According to the IEA, which aims to publish further analysis in a forthcoming "Future of Rail" study, high-speed rail has reduced aviation activity on certain routes in China, Europe, Japan and Korea, and "air traffic dropped 56 percent between Paris and London and 58 percent between Brussels and London when the Eurostar was introduced … China, which has made high-speed rail a key policy priority in the past decade, has already built more than 20,000 km. of high-speed rail infrastructure."

Currently 18 percent of all commercial passenger flights are time-competitive, the IEA says, meaning that for these routes, which account for around 6.5 percent of aviation energy use, "switching to high-speed rail could be a viable and more energy-efficient alternative."

Buildings & Appliances

• Energy use in the buildings sector continues to climb, but without energy efficiency improvements since 2000, energy use would have been 12 percent higher in 2017. "Final energy use in buildings and appliances rose by 21 percent between 2000 and 2017 to reach 120 exajoule (EJ). Energy savings of 14 EJ have been achieved since 2000, thanks to expanded energy efficiency policy coverage, technology improvements and investment trends. These are impressive savings given the level of economic expansion, population and floor area growth during this period."
• Building codes and appliance standards have been key policy measures, preventing additional buildings energy use. "Globally, 34 percent of building energy consumption was covered by mandatory energy efficiency policies in 2017, 32 percent in residential and 43 percent in non-residential buildings. At the end-use level, lighting and cooling are leading the way with mandatory policy coverage near 80 percent, although stringency varies.
• The Efficient World Scenario highlights the potential for global building energy demand to remain flat between now and 2040, despite total building floor area growing by 60 percent. "Buildings in 2040 could be nearly 40 percent more energy efficient than today. Space heating offers over a quarter of the potential energy savings. Water heating efficiency could also improve by 43 percent, and improvements in space cooling, which is the fastest growing source of building energy demand, could see air conditioner efficiency double.

Top States for Energy Efficiency

Among the organizations keenly attuned to the IEA report was the American Council for an Energy-Efficient Economy, which in early October released its annual State Energy Efficiency Scorecard. The down and dirty (or clean) details:

Massachusetts again ranked No. 1, followed by California. New Jersey, Connecticut, Colorado and South Dakota improved the most.

"In response to federal efforts to freeze U.S. vehicle and appliance standards, quite a few states worked to retain their own standards and to promote electric vehicles as well as zero-energy buildings," said the ACEEE. "While some, like Iowa and Connecticut, saw legislative attacks within their states, others — including Virginia, New York, New Jersey, Colorado, and Arkansas — unveiled plans to boost investments in efficiency and clean energy, often driven by concerns about climate change." Here's how the map looks:

The scorecard ranks states based on 32 metrics in six areas: utilities, buildings, transportation, state government, combined heat and power, and appliance standards. Among the key findings (quoted directly from the ACEEE release):

• New Jersey improved the most, moving up five spots to No. 18. "The Garden State set new annual energy savings targets and took steps to rejoin the Regional Greenhouse Gas Initiative, a multistate cap and trade emissions compact," the ACEEE noted. Iowa fell the most, moving down five spots to No. 24. "This drop was due mostly to a bill signed earlier this year (SF2311) that imposes a restrictive cap on efficiency programs and allows customers to opt out of paying for some of them," said the ACEEE.
• States increased investments in energy efficiency in the utility sector. They spent nearly $8 billion last year, up from $7.6 billion in 2016. The result was a 7.3-percent increase in electricity savings (nearly 26.5 million megawatt-hours).
• States ramped up efforts to promote zero-emission vehicles (ZEV), mostly electric. California joined with eight other states in rolling out an updated ZEV plan, which incentivizes consumers to buy ZEVs. Missouri moved to incentivize the rollout of more EV charging stations, and Oregon to require new buildings be ready to charge EVs.
• More states pushed for zero-energy construction (buildings that produce as much power as they use) largely through tougher building codes. California calls for all new homes and commercial buildings to be net zero-energy by 2020 and 2030, respectively. Vermont, Rhode Island, Oregon, Washington, the District of Columbia and Massachusetts have incorporated net zero-energy construction into long-range plans.
• States ramped up efforts to create the utility of the future. Ohio, Rhode Island, New York, California, and Minnesota have major plans in place. They're looking to modernize grid infrastructure, leverage data, and deploy more distributed energy resources.
• California and Vermont led in setting appliance standards. California, which has standards for 100-plus products, set new standards for computers, computer monitors, and portable electric spas in 2017. This year Vermont adopted new standards for 16 products.
• States focused on innovative financing solutions. Six states (California, New York, Connecticut, Hawaii, Nevada, and Rhode Island) have set up green banks, and Washington, D.C., passed legislation this year to do the same.