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Translating Energy Management and Facility Management into Impacts that Matter

September 18, 2015

Buildings impact business results. Or, perhaps better said, the environments we create to work, eat, play, learn, and live in impact the quality, productivity, quantity, and efficacy of all indoor activities we do in our modern society.

Managing that built environment has evolved like every other aspect of our lives. We expect more than the minimums of code compliance and a roof that doesn’t leak. Healthy, productive, secure and sustainable — all are words that apply in today’s facility management world.

The next step in the evolving built environment is transforming buildings from costs to business advantages. This may take any number of forms and attributes. Today’s buildings with today’s combinations of talent, technology, and integrated services can move from simple assets in the real estate sense to assets for improving, enhancing and  growing your business, whatever that may be.

There are numerous ways to impact your “bottom line.” In this series of blog posts, we’ll discuss a number of impacts that “better buildings” can have — and how to use them to make your building an advantage for your organization.

Factor 1: Reducing Utility Costs

When thinking about money-saving opportunities related to energy consumption, the most obvious factor that comes to mind is to reduce the utility spend. Everyone who has to pay a utility bill at the end of the month realizes it has a real and significant impact on the monthly budget. For most organizations utility costs are a top five operating expense, and a top three expense for many.

For many businesses, the dollars saved on utility costs have a multiplier effect on the budget. For example, every dollar saved in utility costs might have an operating impact of 10 to 20 times in new revenue. In other words, the dollar saved is equivalent to $20 dollars of new business.

Even more than the opportunity cost, what can you do with the “repurposed” revenue? Are you a school district trying to save a program or staff resource? It’s been shown by the EPA that a small savings of 2.5% over three years is more than an additional teacher’s salary in an average school district.

Are you leaving money on the table? An energy services company can reduce the costs of your energy spend by helping you find smart ways to use less, and often spend less, for the energy you need.

Factor 2: Reducing Energy Use

Reduced energy or utility use impacts bottom-line costs directly. However, utility cost reduction alone is not the only reason — or even the biggest reason — to act.

In addition to the direct cost impact, using less energy can impact everything from lease rates to classroom content to fulfilling organizational commitments for a better, more sustainable future to investment categories. The amount of energy and other utilities used can even shift operating realities for building owners by placing the organization in a different regulatory or rate category, which may have significant cost and resource impact. Reducing utility use in day-to-day operations, which requires less for the same output, may extend the use of your existing infrastructure as an organization grows, deferring large capital expenses as expand operations.

While new technologies and renewable energy sources are gaining popularity, energy efficiency remains the easiest — and single most cost-effective — way to cut energy use. The most energy-efficient buildings in America — those that have earned EPA’s ENERGY STAR recognition — use 35 percent less energy than typical buildings, all without trade-offs in performance or comfort.

Research also shows that more efficient buildings have higher occupancy rates and increased asset value compared to typical buildings. Tenants want real estate with lower utility bills, and more and more organizations are implementing leasing policies mandating environmentally-friendly space. What’s more, consumers and employees report a desire to affiliate with organizations they perceive to be environmentally responsible.

Making small incremental changes can have a significant impact in this area.

For instance, implementing automated controls and 24/7 optimization of energy systems may reveal and correct small inefficiencies in your operating schedule that can make a significant cumulative impact. Simple things like turning devices off rather than leaving them in “sleep” mode or purchasing the next most efficient appliance, light bulb, equipment all add up. There are often even rebates or incentives to help when making the efficiency upgrade.

Learn how Trane works with customers to manage energy use and discover hidden opportunities for savings.