The following commentary was written by Charles Perry, managing partner of Perry Rose, a real estate management company in Denve. See our commentary guidelines for more information.
Though at first glance it is less obvious than the cars we drive, our offices, shopping centers and homes are actually major sources of climate pollution. In Colorado, in fact, buildings are responsible for a fifth of all carbon emissions. That is why finding ways to dramatically reduce the carbon footprints of our buildings is key to meeting our state’s ambitious climate goals. A good place to start is by reducing energy waste in buildings — and that’s where energy benchmarking can help.
What is energy benchmarking? It’s a way for building owners and managers to measure and track a building’s energy use to understand where there are areas for improvement.
As a real estate company based in Colorado, Perry Rose knows first-hand the value of reducing energy waste, and how energy benchmarking can help. We perform energy benchmarking at all of our properties because it allows us to identify and implement strategies to make them more efficient — which in turn saves us and our tenants money and reduces the carbon footprint of our buildings as we work toward decarbonization.
Given our experience with the benefits of energy benchmarking, we welcome the recent introduction of new state legislation that would require energy benchmarking for all commercial and multifamily buildings in Colorado. A statewide benchmarking policy would help Colorado businesses make smarter investment decisions, encourage innovation in building design and construction, and bring a myriad of economic benefits to residents across the state.
Measuring and reporting energy use in buildings is the first step to uncovering opportunities to reduce energy waste. Armed with this data, building owners and managers across Colorado will be better informed when it comes time to make investment decisions so that they prioritize which investments will cut the most costs and add value.
For Perry Rose, benchmarking has helped us identify cost-effective building upgrades that also improve the comfort of our tenants, such as increased insulation, automatic heating, cooling and light controls, and high-efficiency HVAC systems.
Colorado already has several examples of successful energy benchmarking policy. Boulder, Denver, and Fort Collins have already implemented energy benchmarking ordinances. Over the course of one year, Denver’s program cut energy use in large buildings by 4.5% and saved $13.5 million. Implementing a similar policy statewide would expand these savings so Coloradans across the state could benefit.
A statewide benchmarking policy would also create a baseline of consistent, transparent, and reliable information to help Coloradans better understand and compare how different buildings perform. This is important for creating a competitive market in our state for efficient, high-performing and well-maintained buildings. Prospective tenants or buyers can use information from energy benchmarking to consider energy use alongside other building features, such as location, square footage, price and amenities.
By highlighting the importance of energy costs in real estate transactions, building owners will start to recognize energy efficiency as the business opportunity it is — which will help to spur investments in energy waste reduction measures to make their buildings more attractive in the real estate marketplace. To top it off, these investments are also an important driver of economic growth and local job creation, as energy waste reduction provides work that cannot be outsourced.
Finally, the value of energy benchmarking is especially important in affordable and mixed-income housing.
Low-income households are more likely to pay a higher percentage of their income on their energy bills. Investing in energy waste reduction, as well as building and appliance upgrades — as informed by energy benchmarking — helps keep energy and housing costs low, so that residents can spend their money on other critical goods and services.
Perry Rose is one of many businesses that know the value of energy benchmarking and want to see it implemented statewide. That’s why we recently signed a letter with 17 other businesses urging Governor Polis and the Colorado Legislature to adopt a commercial energy benchmarking policy for the state. Doing so would greatly benefit Colorado and ensure its business community continues to thrive.