Every nonresidential building is unique. Hence, if building owners want to assess the energy efficiency of their buildings, simply measuring energy use and comparing to other buildings’ energy use will not allow for an “apples‐to‐apples” comparison. A building rating attempts to overcome this problem by accounting for expected variations in operational parameters, such that a building’s energy use and/or levels of energy efficiency can be judged within a relative performance metric. Building ratings serve multiple purposes:
• Provide a metric for determining the relative energy efficiency of a given building • Provide a means for communicating the benefits of improved energy efficiency • Allow for long‐term tracking of energy efficiency
Ratings fall into two general categories: energy use ratings (also known as “operational” ratings) based on actual energy use, and asset ratings based on the potential efficiency of the
building’s permanent energy‐consuming assets.
Energy Use Ratings
The key inputs required for an energy use rating are a building’s actual energy use data (at least 12 months worth), along with a limited set of building‐specific data, for example, size, type, address, occupancy percentage, and hours of operation. This data is analyzed and compared to a dataset that contains similar types of buildings, and a relative rating is determined.
By far the most recognized energy use rating tool in the United States is the Environmental
Protection Agency’s (EPA) ENERGY STAR Portfolio Manager, which provides a rating between
1 (least efficient) and 100 (most efficient) for buildings. The rating is “statistical,” meaning that a given building’s rating will indicate the percentile in which it lies relative to its peers. For example, a rating of 65 means that a building is more efficient than 64 percent of its peers. The underlying dataset used for comparison is the DOE’s 2003 Commercial Buildings Energy Consumption Survey77. As of mid‐2011, 230,000 buildings nationwide were benchmarked using Portfolio Manager, representing 24 billion square feet; of this total, 2,194 million square feet are in California, making it the state with the largest total floor area covered78. Obtaining a score of 75 or above qualifies a building for an ENERGY STAR plaque. A prerequisite for applying for the plaque is that the score be verified by a certified professional engineer (PE).
77 See http://www.eia.gov/consumption/commercial/ for more details
Policy makers’ selection of ENERGY STAR Portfolio Manager for disclosure legislation (covered later in this chapter) will likely bolster its position as the dominant energy use rating. In
California, the CPUC has helped to promote ENERGY STAR by requiring utilities to benchmark properties through their programs79; as of 2011, almost 5,000 properties were reported to have been benchmarked as a result of this requirement, although there have been reported challenges such as matching meters to buildings, identifying building types and square footage, and
customer privacy concerns80. Further reinforcement will likely come from the ever‐growing body of research81 that links higher ENERGY STAR ratings with higher property values. ENERGY STAR Portfolio Manager requires some training, but it is free of charge, easy to understand, requires little effort to collect the required data, and is based on a fairly comprehensive national dataset. (Some have argued that the peer sample size for certain building types does not allow for robust statistical analysis.) The main drawback of Portfolio Manager is that its 5,000 square feet minimum size threshold, coupled with some building types being excluded, result in more than 50 percent of California’s floor space being ineligible for a rating.
CBEURT (California Building Energy Use Rating Tool, pronounced “C‐Burt”) is being
developed by the Energy Commission to complement Portfolio Manager. With both tools, the California building market can compare a building’s energy use to both the national building stock and to other California buildings. CBEURT is designed to overcome the main drawback of Portfolio Manager and to provide a more comprehensive peer group database for California buildings. Features of CBEURT include:
• The ability to rate buildings smaller than 5,000 square feet
• Rating metrics are designed to complement California’s Zero Net Energy (ZNE) goals, that is, a zero rating is zero net energy, and a 100 on the scale is energy use equivalent to the median California building of the type being rated.
• Ratings are possible for buildings with multiple occupancies.;
• The data source is the California End Use Survey (CEUS) (2003)82, not CBECS. • California climate data is used to normalize the energy use data.
79 Refer to CPUC Decision 09‐09‐047.
80 Statewide Benchmarking Process Evaluation, Volume 1: REPORT; April 2012; NMR Group
81 An example is Eichholtz, Piet, Nils Kok, and John M. Quigley. Working Paper No. W10-003: The Economics of Green Building. Web. April 2011. In this paper, “green” buildings are considered to be those that have either a LEED certification or are certified for energy efficiency by the US EPA’s Energy Star Program. Other examples can be found at http://www.buildingrating.org/content/efficiency- property-value
82 Itron, Inc., California Commercial End‐Use Survey. March 2006. Data based on a survey of 2,800
commercial properties in California, as opposed to CBECS, which is based on a national dataset of 5,215
CBEURT is intended to be offered as both a Microsoft Excel® spreadsheet and as a Web‐based energy rating tool and is planned for release in the first quarter of 2013.
ASHRAE’s Building EQ (bEQ) “In Operation” rating provides a building with an A+ (most efficient) to F (least efficient) rating, based on actual energy use. ASHRAE bEQ was released in 2012 and, like Portfolio Manager, is based on the CBECS database. Beyond the differences in how the rating is communicated, bEQ also differs from Portfolio Manager in that it is not free, and there is a more structured assessment process required to obtain a rating. A bEQ rating can be provided only by a certified building energy assessment professional, it includes an
ASHRAE Level I Audit, and it requires a $500 registration payment to ASHRAE. In addition, the bEQ energy assessment includes highlighting potential energy conservation measures, although they do not directly contribute to the rating itself. It is too soon to evaluate the market impact of the bEQ rating.
NABERS, the National Australian Built Environment Rating System, is a performance‐based rating system for existing buildings. The main outputs of NABERS are ratings between one and six stars for both energy and water use. The rating, covering offices, hotels, retail, schools,
hospitals, and homes, is tailored for use by building owners, managers, and building occupants. Depending upon who is seeking a rating and the scope of its influence, NABERS will require a different set of inputs, for example, building occupants can report on the performance aspects relating to the elements under their control. The NABERS rating system has been featured in mandatory disclosure legislation since 2010.
The link between energy use ratings and property value has been reported several times. (See earlier note.) This link would suggest that energy use ratings are a valuable element for
property transactions, but technically there is one major limitation of energy use ratings in this context. Energy use is strongly influenced by operational factors, occupancy, hours of use, and so forth. These are factors that may change significantly when a new owner takes on a
property, thus reducing the relevance of the prior owner’s energy use rating. This limitation is one of the major factors behind the drive to develop asset ratings.
Asset Ratings
Asset ratings are somewhat analogous to an MPG rating for a car, in that they express a
measure of performance potential as opposed to measuring how a vehicle has performed for an actual owner. There are two noteworthy differences, however:
• Asset ratings are determined through building energy modeling, whereas an MPG
rating is the result of a standardized road test.
• While an MPG rating can be used to compare the relative efficiency of cars across vehicle classes, asset ratings are generally only comparable for buildings of the same type.
In the context of an asset rating, an “asset” can be defined as anything that affects energy use that is typically left in place when a property is sold. For example, insulation, HVAC
equipment, lighting systems and windows are assets, whereas photocopiers, occupants, and refrigerators are not. An asset rating determines a rating based on all assets performing
optimally, with all other input factors being based on default assumptions. The principal benefit of an asset rating is that it allows a potential buyer to compare multiple properties, even when those properties are being operated very differently from each other. A secondary benefit is that a building owner considering an energy efficiency upgrade can determine the rating that would be achieved as a result of making the improvement.
Asset ratings have been implemented in multiple European countries as a result of the European Energy Performance of Buildings Directive83. Ratings are based on an A (most efficient) to G (least efficient) rating with some variations between countries. In the United Kingdom, an A rating represents zero net energy use, and an average property would gain a rating of D or E. (The rating scale is linear.)
In the United States, DOE and the State of California are each developing an asset rating system, and Massachusetts Department of Energy Resources is completing research to support the future development of an asset rating program.
California’s BEARS is entering a pilot phase to evaluate the practicality, robustness, and cost of the process. The system will rate a building on a linear (not statistical) scale between 0 and 250, with zero representing net zero energy use and 100 representing a code‐based benchmark. The rating represents the ratio of the rated building’s energy use to a code‐based benchmark. For example, if the rated building as modeled uses 30 percent more energy than the code‐based benchmark, then its rating will be 130.
DOE’s asset rating is also in the pilot phase, and specifications have not yet been publicly released. (Various design‐related options have been reported and released for public
discussion.) One way in which it is expected to be different from BEARS is that DOE is expected to use source energy84 as the main energy metric, whereas BEARS will use the TDV85 of energy. DOE’s asset rating scale is expected to be similar to ENERGY STAR Portfolio Manager, where 100 is best and 1 is worst in terms of relative energy efficiency. Another key difference expected is that DOE’s asset rating will include an assessment of potential improvement opportunities. Cost is perhaps the greatest challenge for asset rating development. A comprehensive site assessment combined with simulation modeling can cost more than $10,000. An asset rating needs to significantly reduce that cost while still being technically robust. Innovative
approaches to field data collection may be explored as a way of limiting costs, such as thermal
83 Directive 2010/31/EU of the European Parliament and of the Council of 19 May 2010 on the Energy
Performance of Buildings. Available at http://eur‐
lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:32010L0031:EN:NOT.
84 Source energy is a metric that encompasses all the energy used in delivering energy to a site, including
power generation and transmission and distribution losses, as opposed to “site energy” which includes
only the energy used at the building (that is, the amount of energy that appears on the utility bill)
85 Time‐dependent valuation is based on the cost for utilities to provide energy, which can vary based on
time of day/week/year. More details at
imaging technology or determining building envelope parameters from digital photos or Google Maps, iPad applications, and so forth.
Beyond the technical challenges of asset rating development, there will likely be significant market challenges. ENERGY STAR Portfolio Manager has been around for a decade and has high market recognition in certain submarkets, such as Class A buildings. As asset ratings enter the market, the key questions to answer will be: What is an asset rating? How is it different from Portfolio Manager? Why is another rating needed?