Commercial buildings spend millions making people uncomfortable, but utilities can help

spend the vast majority of our time—maybe 90% or more, by some statistics—inside buildings. And we spend a lot of that time uncomfortable.

There's more than just anecdotal evidence, though most people have experienced overly-aggressive air conditioning in August, or sweltering spaces in January. A new study from researchers at the Rochester Institute of Technology finds commercial buildings are spending $600 million more than necessary every year to heat and cool spaces, while wasting significant energy doing so.

Eric Williams, an associate professor at the Rochester Institute of Technology, was an author on the recently-published "Co-alignment of comfort and energy saving objectives for U.S. office buildings and restaurants," published in Sustainable Cities and Society.

"We’ve all had the experience of being or cold or hot when we shouldn’t be," Williams said. But what seems like a fairly minor irritation "is actually pretty darn significant. I was surprised."

And those findings are echoed by the focus of demand management providers targeting these spaces for load control as well as improved customer service. According to Neel Gulhar, senior director of product marketing at Oracle Utilities, "nearly one in two of the buildings we’ve looked at has an efficiency opportunity, and many of those are related to heating and cooling."

According to Williams, who worked with RIT PhD candidate Lourdes Gutierrez on the research, more than 40% workers are dissatisfied with temperatures in their offices and almost 15% are very dissatisfied. That means commercial spaces may be working hard to make more than half of their occupants uncomfortable.

Much analysis has been done in the residential space, and manufacturers have created lines of intelligent devices aimed at keeping the home comfortable while saving energy. But the math is simpler—an apartment or single-family home has far fewer people to satisfy, and temperature is more likely to align with comfort. But as buildings grow in scale and capacity, the same decisions are increasingly complex and impact more employees and customers, as well as profits.

Changes for comfort, climate

In terms of real energy consumption, Williams and Gutierrez' research is ... chilling.

Changing office building temperatures to better match employee comfort could save 3,100 GWh in electricity and 17,500 billion Btu in natural gas each year—about 1.4% of total office building power consumption and 6.5% of gas burn. Similar changes in full-service restaurants could achieve savings of 1,300 GWh in electricity and 2,800 billion Btu in natural gas, or about 2% and 1.4% savings, respectively.

In total, the analysis shows primary energy savings of almost 70 million gigajoules of energy—2.5% of the energy used in office buildings and restaurants, leading to annual savings of $600 million

If you add in hotels, stores and other types of commercial structures, Williams said simply revising thermostat settings could drop national carbon emissions by 0.3%—about the equivalent of pulling 4 million cars off the roads, he said. For reference, Williams noted annual potential savings from thermostat settings is comparable to the total energy generation by U.S. solar PV generation in 2015, almost 84 million GJ.

And all we have to do to recapture some of it, he said, is "get people to change their thermostat in an intelligent way," ultimately getting "more people to share the burden."

"Our results create a motivation for increased government activities to understand thermostat settings and comfort because their energy implications relate to a public good, climate, rather than simply being a private sector affair," the paper concludes.

It is not quite as simple as making everyone more comfortable, however. Different organizations are driven by competing factors—some prizing operations over efficiency, or simplicity ahead of efficacy. "It is not currently clear how different organizations think about and implements thermostat settings," the report found, adding, "it is important that more information be collected on this issue."

For instance, better-aligned thermostat savings in the restaurant industry will save your average establishment more than $500, Williams said.

"But thermostat settings must, however, compete for a restaurant manager’s attention among many other issues," the report explained. "It is not clear that if $510 savings is sufficient."

Finding a comfortable solution

Restaurants operate on paper-thin margins, and national climate goals make carbon emissions an issue for all organizations. But if the savings are modest an each facility, how do you get building managers to effectively make changes?

And isn't this exactly the issue that learning thermostats, smart buildings and demand management systems were designed to tackle?

In larger commercial buildings the heating and cooling is often controlled by a building management system, said Orace's Gulhar. "While these systems are inherently 'smart' – they can be programmed and adjusted – they need to be commissioned to heat and cool to the right temperatures at the right time of day," he said.

Gulhar and Indran Ratnathicam, vice president of marketing and strategy at First Fuel, a strategic partner of Oracle's, answered some questions on commercial building optimization via email. In many buildings, they explained, the commissioning isn’t regularly monitored, resulting in issues with both temperature and efficiency.

Oracle, which recently scooped up cloud-based demand management provider Opower in a $500 million deal, has learned from its work in the residential space, where smart thermostats are helping maintain efficiency and comfort. "We’ve found a similar opportunity in the small business space," the two executives said. "Small business owners and operators want to focus on running their business, and don’t want to worry about setting their systems exactly right for comfort and cost. ... Smart/learning thermostats could have a big impact for this segment."

Utilities can play a big role in optimizing smart thermostats, and some have already seized opportunities to do so. For example, the recent partnership between Nest and Southern California Edison to build a virtual power plant to mitigate potential fuel shortages from the Aliso Canyon methane leak. Another example is ComEd's initiative to install 1 million smart thermostats in its Chicago-area territory by 2020.

Not to mention thermal storage. Ice Energy's Ice Bear unit aims to help building managers manage air-conditioning units, and can be owned or operated by the utility.

More data, better defaults are needed...

But only if people better understand the problem, possible solutions, and the potential savings.

There are a couple of solutions identified in Williams and Gutierrez' paper. First are broader temperature settings, adjusted for climate zones, in building management systems. Better accounting for the clothes people actually wear, in different regions of the country, can also make a significant dent.

But the federal government can take steps to better define the issue, they said, and possibly put that data in the hands of building managers. "If you have a smart thermostat, you'll know what's going on in your building," Williams said. "But unless there is some integrated effort to bring that to a clearing house, that information will stay isolated."

Williams said thermostat vendors, or building management software developers, could consider a repository for initial temperature settlings. And the U.S. Energy Information Administration can begin collecting data on thermostat settings in commercial buildings—something it already does on the residential side.

EIA's Commercial Buildings Energy Consumption Survey tracks statistical information on energy-related characteristics, consumption, and expenditures for the nation's 5.6 million commercial buildings, but it doesn't include questions on thermostat settings. EIA's Residential Energy Consumption Survey, however, does as thermostat setting questions, so Williams' paper posits that "extending to CBECS should be straightforward."

"You still have to figure out where to set the thermostat," Williams said, and "it’s not clear how those building managers are making that decision. But depending on where you live and what season it is, you can make people more comfortable and save energy."

FirstFuel's Ratnathicam said his company analyzes data for millions of buildings for utility partners, often revealing lapses.

"In an ideal world, when a building is first built, the heating and cooling settings would be commissioned to optimal efficiency levels. But, there are many buildings that have never been commissioned or older buildings where settings have not been monitored or adjusted in a number of years," Ratnathicam said. He said FirstFuel's platform can optimize heating and cooling inefficiencies, examine occupancy schedules and identify issues like simultaneous heating and cooling – where both systems in effect cancel each other out.

A building manager is just trying to do the right thing for occupants, often meaning daily adjustments to temperature settings. "But after 6, 12, or 18 months of corrections, the altered settings leave many people uncomfortable and the whole building inefficient," Ratnathicam said.