| A powerful and clear incentive |
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| Written by Alan Aldridge, Executive Director, ESTA, 2007 | |
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The introduction of Energy Performance Certificates offers facilities managers a powerful tool to persuade building owners of the need for greater investment in energy efficiency argues Alan Aldridge, Executive Director of the Energy Services and Technology Association (ESTA). What are the implications of the Energy Performance Certificates?Which organisations are required to have an additional Display Energy Certificate? New regulations came into force on 19 April 2007 applying to virtually all buildings in the UK. From next year, whenever a building is bought, sold or let, the owner will have to provide the prospective purchaser or tenant with an Energy Performance Certificate. This contains basic information about the site and the assessor, as well as an 'asset rating' and recommendations for improving the energy performance. For large public buildings there are further requirements - to display an energy certificate that has both an asset rating and an operational rating. Importantly, the energy performance will be displayed graphically in a series of performance bands from A to G, with A being the highest performance. This is similar to the format used on new fridge-freezers, washing machines and cars. By presenting energy performance in a simple but official way, discussions about energy management and investment programmes can be presented in an easily accessible manner. For senior executives, who may not have much knowledge of energy matters, this is a quick and easy way of assimilating the basic issues surrounding the energy performance of their sites. For those who drafted the original legislation - the Energy Performance of Buildings Directive - this measure was seen as a way of making energy 'visible' and bringing it into the realm of consumer choice. And in the case of freezers and, more recently, cars, the aim has been successful. With clear information about the comparative energy costs associated with similar models, people have opted for greater efficiency. In the buildings sector, we expect the Energy Performance Certificates to play a role in influencing asset values. Given two similar buildings, the prospective purchaser/tenant is likely to opt for the more efficient one with lower energy bills, unless some allowance is made in the contract price. In other words, higher performance buildings will attract higher rents and be worth more when sold - they will have a greater asset value. Anything affecting asset values is likely to make the finance officers take notice. Facilities managers will be able to put their case for further investment in energy efficiency measures by showing the impact of raising the performance to the next band against the likely impact on rental/sale value. There are two different ratings used in the certificates - asset ratings and operational ratings. Asset ratingsAsset ratings are snapshots of the intended energy performance 'as built'. They are calculated from the materials used and the systems installed. For new buildings this will be part of the construction process; in fact no completion certificate can be given unless an energy performance certificate is available. For older structures though, especially those that may have undergone periodic upgrades over the years, the process will be more complicated - indeed the paper trail may be quite long. It may prove cost-effective in some cases to bring in outside help in some cases. Operational ratingsThe operational rating is just that - it is a measure of how efficiently a building is actually operated and managed, and is based on actual metered energy use. It is relatively simple to work out as well. All that is required are accurate records of the energy consumption over the previous 12 months. This type of rating is particularly useful in benchmarking performance and projecting improvements. The legislationVirtually all buildings must have an Energy Performance Certificate (EPC) before they can be bought, sold or let. Most buildings, however, are only currently required to have one that includes an asset rating, although the operational rating is an excellent and cost-effective way of assessing all buildings, not just those covered by the legislation. A number of public and private sector organisations are already opting to do so. Larger public buildings (defined as those "with a total useful floor area over 1,000m2 occupied by public authorities or by institutions providing public services to a large number of people and therefore frequently visited by these people") will also be required to have and display a Display Energy Certificate (DEC). In addition to the details carried on an EPC, this will also have to show an operational rating. The definition in practice will cover buildings funded by public money such as PFI projects, hospitals, universities etc. However, within that broad definition there is the scope for a great deal of uncertainty. While hospital A&E units and wards might be covered (as "frequently visited by large numbers of people") what of the hospital's administration units? And what about prisons and police cells - do prisoners count as 'the public'? ESTA has been urging the Government to clarify the definition so that everyone knows exactly what it covers. Otherwise there is the potential for widespread confusion if each hospital trust and police authority comes to its own interpretation of the regulations. Public and private sectors
 Table 1. Implementation timetable for non-domestic buildings, EPCs and DECs. Under the Statutory Instrument setting out the new rules (SI 2007/991), DECs have to be on display from 6 April 2008 - which may cause a number of public sector organisations a problem. Operational ratings need a full 12-month metering history. So for a certificate to be produced for April 2008, metered data for April 2007 (or earlier) needs to be available - as well as the equivalent records for any solid or liquid fuels used for the heating systems. Visit www.esta.org.uk |
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