The Best (Re)Invesment: Big Payoffs with Green Retrofits

It takes money to make money. The expression certainly applies to green retrofits: throw some cash at upgrading your 20+-year-old HVAC system and you’re likely to see the reduction in utility bills pay for the first costs and more before too long. You might call it an investment. Now magnify the scenario to the country’s entire existing building stock and the payoff is staggering. In the U.S., an investment of $279 billion to upgrade and replace energy-consuming equipment in buildings could yield $1 trillion or more of energy savings over 10 years, according to a report, United States Building Energy Efficiency Retrofits: Market Sizing and Financing Models, recently released by Deutsche Bank’s DB Climate Change Advisors and The Rockefeller Foundation. In banker speak, that’s a 258 percent gain on the principal invested. The study examines financing models, local and national policy issues, market sizing for various building categories, and climate and employment impacts pertaining to wide-scale building retrofits. Ultimately, it concludes that a massive retrofit in the U.S. could create more than 3.3 million new direct and indirect cumulative job years and reduce carbon emissions by approximately 10 percent – all while generating enormous energy savings. These findings dovetail with work NBI has been doing exploring ways for existing buildings to reduce current energy usage beyond 30 percent and for market opportunities to facilitate these reductions. Last year, NBI co-hosted a Deep Energy Savings in Existing Buildings summit that brought together 80 national experts in various aspects of energy efficiency to discuss ways to develop more aggressive levels of efficiency in the existing commercial building marketplace. This meeting helped expand some remarkable concepts such as aggregated retrofit methods and district-scale energy solutions and led to a Summary Report outlining 6 action priorities for 2012. Hopefully, such ideas will help revise the industry’s energy portfolio and guide it towards a more sustainable future.  With the built environment across the globe using 40 percent of the world’s energy and in the U.S. contributing more to global warming than transportation sources, there’s clearly room for improvement. To this end, the recent study is a persuasive testament to how reinvesting in our existing infrastructure may be the best investment we can make.Download the report