When the Trump administration decided to close the Energy Star program within the Department of Energy, there was widespread concern over the loss of standards for power expenses for consumer and commercial appliances and the implications of a missing tool for energy conservation and increased efficiency.
However, Matt Ellis, chief executive of Measurabl, which offers an ESG platform for commercial real estate owners, operators, and investors, spoke with GlobeSt.com about the numerous less obvious yet significant issues affecting CRE.
“It is a town hall, a meeting place where data from multiple sources is aggregated into a very useful data set,” Ellis said. While there are some private-enterprise services, like those of Measurabl itself, Energy Star has by far the largest and most diverse collection of data.
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Utility data, utility bill pay companies, and other data acquisition firms provided information on building details, size, and asset types, all of which were available through Energy Star. “The essential info for things like calculating carbon emissions” is necessary data for detailed performance benchmarks, says Ellis. “That benchmark allows them to understand where they stand in comparison to other similar buildings.”
The information and benchmarks enable owners, operators, investors and developers to understand their performance relative to others, identifying areas where they can improve efficiency. The information can also provide competitive data that can be used in various ways, including marketing and positioning.
The data from Energy Star has also been critical for energy reporting and carbon management regulations. “Those laws specifically point to Energy Star to comply with the rules,” Ellis said. “Now it’s a regular compliance and output system. On the front end, you have data aggregation, benchmarking, and a mission-critical data set.”
Fannie Mae and some other green building programs rely on Energy Star data for lending purposes. So do many certification programs.
Another critical aspect of the program has been that it’s vendor-neutral and free, at least for real estate owners. “And it’s free to any vendor to connect via API to both read and write data,” Ellis added.
Not that anything is really free. This has been a taxpayer-supported system for decades, having grown and expanded from its inception to become an integral part of the entire commercial real estate landscape. “Before Congress even gets a chance at the budget, they’re freezing the funding and offering the staff early buyout, retirement, or reassignment,” he noted. If all that is left is a skeleton staff, the program may be effectively dead.
“The first reaction is just save it, keep it like it is,” explained Ellis. “I think people are getting the memo that this is probably unlikely. The next mental moment is, should it be replaced? If so, by what? Will the private markets step up?” Who will pay for it and how?
“This is the most significant transformative moment in the sustainability business,” Ellis noted. “It cannot be understated how many things could go sideways or backwards in the sustainability movement. It’s the world’s largest asset class. It’s bigger than student loans, bigger than whatever else is out there. It’s the biggest single energy user. Are you going to tell me that managing the environmental impact doesn’t have a risk-adjusted return?”
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