N ew t e c h n o l o g i e s / s o l u t i o n s

B u i l d i n g s a n d C i t i e s

ACEEE Chicago 2013

Greg Ka ts, Capi ta l E

400 PPM To limit climate change we must move now from shallow to deep EE retrofits

• Deep retrofits: 25%+– Mainstream new technologies

– Hugely accelerate product adoption and innovation

• We must accelerate technology uptake > cost reduction > Increase market penetration > new become norm, emerging becomes new , then norm

Shanghai

1989

2010

4 4

2005 2008 2010 2016

= NonresidentialMarket

$172 billion

$3 billion2% of

market

$60B41%

$212B

= Green Market

$153B

$240billion

$25B12%

Green Building Passes Tipping Point inCommercial/public building Starts

$136B

$47B31%

2011 2013

$60B44%

$64B–$68B45%-48%

$115B–$132B 48%-55% of market

$142B$147B

2012

Source: Green Market Size: McGraw-Hill Construction, 2012; base value of construction market from McGraw-Hill Construction Market Forecasting Service, as of September 2012

Some solutions/technologies we need to scale

• Deep small and mid sized commercial wireless energy management retrofit

• Electrochromic windows, phase change materials

• Zero net energy/carbon green buildings

• Capture and claim health and CO2 benefits

• Cities as systems, addressable buildings

Health & Learning

Benefits of Green Schools

Increased Learning, Productivity & Performance (3%)

Increased Future Earnings of Students (1.4%)

Reduced Asthma (25%)

Reduced Colds and Flu (15%)

Reduced Teacher Turnover (3%)

Source: Greening Our Built World (Island Press, 2010)

$0

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f

Costs and Benefits of Green Buildings: Present value of 20 years of estimated impacts based on study data set and

synthesis of relevant research*

increased building cost

health

water savings

energy savings

indirect energy savings

employment

emissions

Green School Green Office

Additional benefits not estimated:+Productivity and student performance+Property value impacts+Indirect water systems impacts+Brand improvements+Operations and maintenance savings+Embodied energy savings

Costs and Benefits of Green Buildings Increasingly

Include Health and Security

• Source: Kats and Seal, “Buildings as Batteries: The Rise of Virtual Storage”, Electricity Journal, Dec 2012

WEMSystem Configuration

Room

Sensor

Temperature

Light

Presence

Outdoor

Sensor

Temperature

Light

Clamp Sensor

Temperature

Programmer

Controller 1

Controller 3

Controller 4

WEMSystem – The Programmer

WEMS: Wireless Energy Management

Addressing the small to mid sized commercial retrofit marketWhat Our Systems Doz

Customer Savings & Track Record

Accreditations & awards

WEMS: Wireless Energy Management

Thinking Outside the Box/Building

• An Energy Star LEED building with 38% space utilization are inflexible employee policies is NOT an efficient building

• An Energy Star LEED buildings with 50% space utilization and employees who have the ability to work from home is an efficient building.

• HR and IT policies have not caught up with employee flexibility and mobility expectations

• Workforce productivity: rightsizing space and commuting

Sun Microsystems – Open Work: $400 m savings in 5 years

Better Workplace Commute

Management and Reporting

System was used to assess

the 3BL (environmental,

economic, societal) impacts

associated with Sun’s Open Work program.

OVERVIEWOpen Work: Sun’s global, location-independent program providing technologies, workspaces, and best practices supporting all 35,000 employees. The Open Work program was ingrained into the organization’s corporate culture and policies

TRIPLE BOTTOM LINE RESULTS

160 hours of commute time avoided / employee

/year

82,500 tons of CO2 saved/year

$2000 fuel & maintenance savings/employee/ year

6,600 office places saved in 2007

$400M in enterprise saving over a 5 year period

#1 reason employees recommended Sun and

consistently in top 3 in Power of Sun survey

Alternative Work Spaces

::12::

TIAA CREF – Alternative Work Styles with Better Workplace: 1 month payback!

Better Workplace Design,

Management and Tracking

Systems are used to support

the deployment and

operations of the enterprise

wide Alternative Work Spaces

Program.

OVERVIEWTIAA-CREF introduced an organization-wide telework program called - Alternative Work Spaces. The goal is to create an integrated work environment that supports the ability of the workforce to manage, work, collaborate, and innovate on or off site.

TRIPLE BOTTOM LINE RESULTS

Over 2,000 employees formally migrated to

AWS program

Reduced real estate holdings in Tier 1 market

by 75K square feet

$15M in annual real estate savings

Improvement in workplace satisfaction and

employee work / life balance

95% positive employee and manager ratings of

improved productivity and performance

Alternative Work Spaces

::13::

Better Workplace Intelligent

Enterprise Design System and

Management System are used

to drive critical design and

implementation decisions and enable program deployment.

Alternative Work SpacesOVERVIEWNorthrop Grumman Corporation has 120,000 employees. Northrop leverages flexible work practices and alternative workplace design to drive saving across their real estate and IT portfolios, support workgroup collaboration, increase workplace flexibility, and aid in the attraction and retention of key staff.

TRIPLE BOTTOM LINE RESULTS

15 pilot sites involving over 2000 employees

97% satisfaction

22% increase in workspace utilization

$2.3M in real estate savings

Projected $110M / year in enterprise savings at

20% employee participation

2008 CoreNet REmmy Award Winner – Corporate

Real Estate Leadership Excellence

Northrop Grumman – Flexible Work with Better Workplace

::14::

EE must claim CO2 savings: C02 to EE initiative

• The CO2 to EE Mechanism would reward businesses and building owners the value of the CO2 reduction that occurs as a result of their EE investments.

• At a CO2 price of $15/ton, value of CO2 would offset about 20% of the capital cost of the EE investment.

• This model creates a >10x larger price signal than that of the status quo.

• Upfront payments for CO2 reduction allow for increased debt financing.

• Assuming 50% leverage and a CO2 price of $30/ton, it would offset ~ 50% of the capital cost.

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Percent Energy Use Reduction

CO2 to EE Model: Illustrative Impact

Status Quo

$15/ton

$30/ton

$50/ton

C02 to EE Implementation

• Competitive Mechanism to be administered by a PUC

or CEC -managed third party (eg the Energy

Conservation Assistance Act (ECAA) Program.

• Aggregators could include ESCOs, energy aggregators,

smart-grid operators, emissions brokers, etc.

• Would ~ double depth of average ee retrofit

• Broad corporate, real estate, CEC, PUC, CARB support

• Seeking $15 million in pilot funding to demo

P | 18

Buildings as Batteries:The Rise of Virtual Storage

• Most storage services can be far more cheaply provided by software+ controls on buildings

• Building reshapes its load to anticipate and respond to future weather, renewable energy and utility power needs/signals

• Next:

– Building IQ: smart, linked, thermal mass: substantial energy savings even in new LEED buildings

– Digitally addressable buildings/cities: Honest Buildings

Thank you!

www.cap-e.com

www.betterworkplace.com

www.wems.co.uk

www.skylinesolar.com

www.solargrid.com