Business Leaders paying attention to energy efficiency, report claims

Seventy-one percent of business leaders are paying more attention to energy efficiency compared to the previous year. Fifty-eight percent responded that energy management was extremely or very important. These numbers are in a report recently released by Johnson Controls.

The study aimed at identifying organizations’ top strategies to manage energy consumption and educe carbon emissions. When asked to rank their company’s primary issues and targets, 45 percent of executives indicated a preference for energy efficiency in buildings.

“These findings indicate that business leaders in the U.S. are increasingly aware of the need for energy efficiency and the potential this has to reduce operating costs while cutting greenhouse gas emissions,” says C. David Myers, president of Johnson Controls Building Efficiency division.

Johnson Controls is trying to do its part. The company recently installed nearly 1,500 solar panels on the northeast corner of its headquarters campus in Glendale, Wis. Probably the largest solar system in the state, it is part of the company headquarters’ $73 million renovation and rehabilitation project. The headquarters will serve as a showpiece for Johnson Controls as it aims to persuade customers, with the help of the stimulus package, to incorporate renewable energy into their buildings.

Johnson Controls is also one of three organizations currently coordinating the $20 million retrofit of the Empire State building to improve energy efficiency and sustainability. The upgrade is expected to result in $4.4 million in energy savings annually, or a 38 percent energy reduction. If promises turn true, investments will return in a matter of 3-4 years only, at current energy prices.

Uncertainty about future energy prices – the ups and downs on the oil market in 2008, with oil climbing to $150 to dive to $30 a few months later – is one of the main constraints reported by an International Facility Management Association (IFMA) survey. Others barriers revealed by the Energy Efficiency Indicator (EEI) survey of professionals responsible for energy management include limited funding, uncertainty about future energy prices, government incentives, and energy and climate legislation.

Another key finding shows that of the organizations making public carbon commitments, 45 percent identified energy efficiency in buildings as their top carbon reduction strategy. Sustainability continues as a focus for new construction projects as 38 percent are seeking green building certification, while 45 percent plan to incorporate green elements, but not certify their facilities.

The study also reveals a likely 10 percent decrease from last year in the use of facility capital budgets to fund energy efficiency projects, and a 6 percent decrease in the number of respondents planning to make investments using their operational budgets. Clear consequences of the current economic recession: indeed, limited capital availability for investments (42 percent) and unattractive payback (21 percent) were cited as the key barriers to capturing potential energy savings. Nearly 50 percent of executives who oversee energy efficiency investments expect a payback period in less than three years.

The EEI research points out that business leaders believe incentives from utilities or government do have the potential to drive investment. Eighty-five percent – it was 76 percent in 2008 – answered they expect legislation mandating energy efficiency and/or carbon reduction to be introduced within the next two years. Forty-four percent -up from 38 percent in 2008 – report that incentives are very/extremely important as they make decisions on energy efficiency.

The survey also finds that executives are considering a range of on-site renewable energy technologies including wind, solar thermal, solar electric and geothermal sources of energy. Forty-six percent are looking at solar electric, an increase of 8 percent over the previous year. Geothermal energy also received a substantial increase in interest level, up by seven percent.


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