Energy benchmarking: Benefits, process and tools

September 1, 2023

In this article, we explore the concept of energy benchmarking, its benefits, and how it can help commercial property owners improve their energy efficiency. We delve into the key steps involved in energy benchmarking, discuss its impact on energy efficiency investments, and highlight the role of building analytics software in simplifying the process. Whether you're new to energy benchmarking or looking to enhance your understanding, this article will provide valuable insights to help you optimize energy consumption in your buildings.

Jump to:

What is energy benchmarking?

Benefits of energy benchmarking

How to benchmark energy use

Energy benchmarking reports

Benchmarking and energy investments

Energy benchmarking ordinances

Costs of benchmarking

How building analytics can help

What is energy benchmarking?

Energy benchmarking is a process of evaluating and comparing the energy performance of commercial buildings using standardized metrics. It involves measuring a building's energy consumption and comparing it to similar buildings or established energy efficiency standards. The purpose of energy benchmarking is to identify opportunities for energy savings, track performance over time, and encourage energy efficiency improvements in buildings. It often involves the use of software tools and platforms to collect, analyze, and report energy data.

An example of benchmarking legally required by the UK government is the commercial EPC (Energy Performance Certificate) ratings system. All commercial buildings are required to have a score between 'A' and 'F' ensuring they all have a standardized grade showing their energy performance.

What are the benefits of benchmarking energy consumption?

Energy benchmarking offers several benefits to commercial property owners. Here are some key advantages:

  • Cost savings: Energy benchmarking identifies areas of high energy consumption, which incentivises property owners to implement energy efficiency measures. By reducing energy waste and optimizing building systems, owners can achieve significant cost savings on energy bills.
  • Performance tracking: Benchmarking provides a baseline for tracking energy performance over time. Organizations can monitor energy usage, set targets for improvement, and measure the impact of energy efficiency initiatives. This helps in evaluating the effectiveness of energy-saving measures and making data-driven decisions.
  • Competitive advantage: Benchmarking enables property owners to demonstrate their commitment to sustainability and energy efficiency, which can attract environmentally conscious tenants and investors. It also enhances the building's reputation and value in the long term.
  • Access to incentives and financing: Many jurisdictions offer incentives, grants, or financing options to support energy efficiency initiatives. Energy benchmarking is often a prerequisite for accessing these programs, allowing organizations to leverage financial support for energy-saving projects.

What does energy benchmarking involve?

Energy benchmarking involves several key steps and processes. Here's an overview of the steps  energy benchmarking typically involves:

  1. Data collection: Energy benchmarking begins with gathering relevant data on energy consumption and other building characteristics. This can include utility bills, submetering data, occupancy information, building size, and operating hours. 
  1. Data normalization: Once the data is collected, it needs to be normalized to account for variations in factors such as weather, occupancy, or operating hours. Normalization allows for fair comparisons between buildings and accounts for external factors that may influence energy consumption.
  1. Selection of benchmarking tool: There are various benchmarking tools available, with the EPA’s ENERGY STAR Portfolio Manager being the most widely used tool in the United States.
  1. Data analysis and comparison: The benchmarking tool or software is used to input the collected and normalized data. The tool then calculates energy performance indicators and provides a comparison of the building's energy performance against similar buildings or established benchmarks. This analysis helps identify areas where the building is underperforming or has opportunities for improvement.
  1. Reporting and disclosure: In jurisdictions with energy benchmarking regulations, there is often a requirement to report and disclose the benchmarking results. This can involve submitting the data to regulatory agencies, making the results publicly available, or providing reports to stakeholders such as tenants, investors, or building owners.
  1. Performance tracking and improvement: Energy benchmarking is not a one-time activity but an ongoing process. To track energy performance over time, organizations continue to collect and benchmark data periodically, enabling them to measure the impact of energy efficiency initiatives, identify trends, and make informed decisions on further improvements.

What is an energy benchmarking report?

An Energy Benchmarking Report is a document that details the energy performance of a building and ranks or compares it against a relevant benchmark or average.

Such reports usually include:

  1. Detailed consumption data: This is a breakdown of the building's energy use, often on a monthly or yearly basis, and might include specifics like electricity, gas, or water consumption.
  2. Performance metrics: These help building owners understand their energy consumption in relation to factors like building size, occupancy, or function. Common metrics might include energy use intensity (EUI), which measures energy usage per square foot per year.
  3. Comparative rankings: This section places the building's performance in context, comparing it to similar buildings or to regional/national averages.
  4. Recommendations for improvement: Not just a tool for measurement, a good benchmarking report also provides insights into where energy performance can be improved, suggesting upgrades or operational changes that might save energy and reduce costs.

Does energy benchmarking lead to more energy efficiency investments?

Yes, energy benchmarking often leads to more energy efficiency investments. Here's how energy benchmarking promotes and facilitates energy efficiency investments:

Energy benchmarking provides organizations with valuable data on their energy performance, which allows them to pinpoint specific opportunities for improvement. This information serves as a catalyst for implementing energy efficiency measures. Similarly, by quantifying the energy savings and estimating the ROI from data gathered in benchmarking, commercial property owners can make a stronger case for allocating funds towards energy efficiency projects.

Property owners can then measure the impact of their energy efficiency investments by continuously benchmarking energy performance. Measuring the impact of investments provides valuable feedback and accountability, and provides motivation to invest in further energy efficiency for future savings. 

Finally, many jurisdictions and utility programs offer financial incentives, grants, or financing options to encourage energy efficiency investments. Energy benchmarking is often a requirement to access these programs. By benchmarking their energy performance, organizations become eligible for these incentives and financing opportunities, making energy efficiency investments more financially feasible and attractive.

How many energy benchmarking ordinances are there in the USA?

Energy benchmarking rules are determined at both the state and local levels. A significant number of jurisdictions have implemented energy benchmarking and disclosure regulations to promote energy efficiency, such as New York’s Local Law 84 and the Los Angeles EBEWE program. To find out exactly which states and localities have energy benchmarking rules, check out our state-by-state guide to energy benchmarking ordinances.

How much does energy benchmarking cost?

The use of ENERGY STAR Portfolio Manager to benchmark energy usage and comply with energy benchmarking ordinances is completely free, providing no barriers for property owners to begin benchmarking their energy usage and implementing energy efficiency measures as soon as possible.

However, gathering energy consumption data for benchmarking purposes may involve costs, such as the installation or maintenance of energy monitoring systems, meters or submeters. Additionally, if the building does not have automated data collection systems, manual data collection through energy bills or on-site meter readings may be necessary, which can require additional labor, time and costs. 

How can building analytics help owners with energy benchmarking?

Building analytics software, such as CIM’s PEAK Platform, plays a crucial role in supporting building owners with energy benchmarking by providing advanced data analysis, automation, and reporting capabilities. Here's how building analytics software can assist building owners in energy benchmarking:

  • Data collection and integration: Building analytics software can integrate with various data sources within a building, such as energy management systems, smart meters, and utility billing systems. It streamlines the process of data collection by automatically gathering energy consumption data and other relevant building performance metrics, eliminating the need for manual data entry.
  • Energy performance tracking: Building analytics software enables continuous monitoring and tracking of energy performance over time. It can generate automated reports and dashboards that display key performance metrics, trends, and comparisons. This helps building owners track the impact of energy efficiency initiatives, evaluate the effectiveness of implemented measures, and set targets for further improvements.
  • Fault detection and diagnostics: Advanced building analytics software employs machine learning and artificial intelligence algorithms to identify abnormal energy consumption patterns or equipment malfunctions. By flagging potential energy inefficiencies or faults, it helps building owners prioritize maintenance and optimization efforts, leading to improved energy performance.
  • Energy management and optimization: Building analytics software goes beyond benchmarking by offering comprehensive energy management features. It allows building owners to monitor real-time energy usage, set energy targets, track performance against goals, and implement energy-saving strategies for ongoing operational efficiency.

Ready to take control of your building’s energy performance?

Our team of experts is here to help! Request a callback, and let’s discuss how we can help you automate data collection and achieve energy savings.

CIM Team
September 1, 2023