Strategic Asset Management

The Urban Challenge: energy consumption and carbon emissions

As environmental challenges escalate, the focus on reducing energy consumption and carbon footprints has intensified in urban planning. Although cities occupy only 3 percent of Earth's land, they are responsible for most of the global energy use and carbon emissions.

Given that buildings contribute up to 40 percent of the world’s carbon footprint, the spotlight is now on smart buildings. These structures are leading the way toward genuinely sustainable and intelligent cities, leveraging real-time data, automation and artificial intelligence (AI) to revolutionize urban landscapes.

Technological advancements, particularly within the realm of the Internet of Things (IoT), empower cities globally to bridge the gap between sustainability aspirations and the practicalities of urban growth. The shift from analog to digital systems is transforming energy consumption, maintenance efficiency and overall urban development.

From data to action in FM

A critical, yet often overlooked, aspect of this transformation is the establishment of a comprehensive baseline reflecting the status of vital building assets. This includes considerations such as asset condition, life expectancy, current energy usage, and more. Organizations and cities that leverage central asset register and utility data management systems find themselves uniquely positioned to unlock the potential of efficient asset investment planning. This repository becomes the foundation upon which sustainability efforts are built, offering crucial insights into where the journey begins.

Consider a large commercial building as an example. Without a baseline understanding of its energy consumption patterns, stakeholders are essentially navigating in the dark. On average, commercial buildings can lose around 30 percent of consumed energy due to the lack of tracking and optimization. By adopting a proactive approach and employing IoT technologies to gather real-time data on energy usage and performance metrics, decision makers gain actionable insights.

Global Lessons: Edinburgh, Singapore & beyond

Looking ahead, facility managers can apply digital services that enable a plan-optimize-maintain-support cycle, effectively future-proofing their infrastructure against evolving challenges. Integrating advanced sensors and devices to monitor building HVAC systems, lighting and other crucial assets over time empowers decision makers to institute energy-efficient practices and substantively curtail carbon footprints.

As cities embrace technology, IoT emerges as a crucial tool to monitor, manage, and enhance energy efficiency within urban environments. Several cities in the EMEA (Europe, Middle East and Africa) and APAC (Asia-Pacific) regions have embarked on this journey, recognizing that analog systems are giving way to their digital counterparts.

Edinburgh, Scotland, stands out as a prime example of the power of data-driven solutions. The historic City of Edinburgh's Place Management team, responsible for a range of public services and asset management, recently consolidated data on the assets under their jurisdiction. This single source of truth has facilitated better decision making, improved inspection and asset maintenance efficiency and is saving the council money.

In Vancouver, Canada, the Royal Centre, a Class A office and retail space, faced the challenge of new city bylaws requiring commercial buildings to report on energy and carbon usage. Additionally, penalties for heating fuel emissions over a certain threshold and a mandate for zero emissions from heating fuels by 2040 were on the horizon. Royal Centre, despite being an older building, implemented a strategic asset management system to meet regulatory requirements, improve energy performance, and enhance sustainability. Doing so allowed facilities managers to track and report on energy and water usage, and carbon emissions, enabling Royal Centre to meet city regulations and sustainability goals.

Another notable example comes from Singapore in the APAC region. The city-state has been at the forefront of sustainable urban development, leveraging advanced technologies to enhance energy efficiency in its buildings. The Singapore Green Building Council (SGBC) has implemented the Green Mark certification, which evaluates buildings’ data for their environmental impact and performance. This certification encourages developers and facility managers to adopt sustainable practices, reducing carbon footprints and contributing to the city's overall environmental goals.

Greenhouse gas reporting landscape

The greenhouse gas (GHG) emissions reporting landscape in North America is also complex and evolving. With programs already existing in Vancouver, New York, California, Boston and beyond, one can expect an increase in reporting requirements over the years ahead.

In Canada, the Greenhouse Gas Reporting Program (GHGRP) requires mandatory reporting of greenhouse gas emissions from facilities that meet certain criteria. The reporting requirements are divided into three scopes:

• Scope 1 emissions are direct emissions from sources that are owned or controlled by the reporting organization, like burning natural gas on-site.
• Scope 2 emissions are indirect emissions from the consumption of purchased electricity, heat, or steam.
• Scope 3 emissions are indirect emissions that occur in the value chain of the reporting organization, including emissions from suppliers, customers, and other stakeholders, such as garbage waste.

In the U.S., the Securities and Exchange Commission (SEC) has proposed new rules that would require public companies to disclose their greenhouse gas emissions, including Scope 1, Scope 2 and Scope 3 emissions. The proposed rules would require issuers to disclose their Scope 3 emissions if they are material or if the issuer has set targets for them.

Though reporting requirements for each country and region will vary, the underlying requirement of having a baseline understanding of operational energy use and associated emissions is consistent. Having a trustworthy single source of truth for this foundational emissions data, typically through a utility data management system, is key to successfully understanding, reporting and long-term planning.

Implementing strategic asset management: a guide for FMs

There are a few actionable steps that FMs can take to translate these learnings into tangible strategies for a sustainable future:

1. Conduct a Comprehensive Asset Assessment:

Begin by establishing a baseline understanding of a facility’s assets. It will be impossible to divulge what carbon reduction looks like for a specific organization without knowing what its starting point is. This includes assessing asset condition, life expectancy, and current energy usage. Utilize a central asset register to compile this vital information.

2. Invest in IoT Technologies:

Embrace IoT technologies to monitor and gather real-time data on energy usage and performance metrics. Implementing submetering systems, sensors and devices will provide actionable insights into areas where energy is being wasted, enabling informed decision making.

3. Develop a Long-Term Sustainability Plan:

Shift from reactive to proactive asset management by creating a comprehensive sustainability plan. This should include strategies for optimizing energy consumption, reducing carbon footprints, and future-proofing infrastructure against evolving challenges.

4. Integrate Smart Asset Capabilities:

Explore and implement smart asset capabilities that allow for a plan-optimize-maintain-support cycle. This integration ensures continuous improvement in energy efficiency and asset performance over time.

5. Collaborate and Share Data:

Learn from successful examples, like the City of Edinburgh, by consolidating data and creating a “single source of truth.” This collaborative approach enhances decision-making, improves efficiency, and saves costs.

6. Educate and Involve Stakeholders:

Ensure that all stakeholders, from FMs to building occupants to building owners, are educated about the importance of sustainable practices and carbon reporting initiatives. Foster a culture of environmental responsibility to create a collective impact.

7. Monitor Local and Federal Requirements:

Mandatory and voluntary energy and emissions reporting requirements continue to increase over time, with federal and local governments starting to implement their own variations. Monitor existing or upcoming programs and potential financial penalties associated with non-compliance to adjust energy and carbon reduction plans accordingly.

8. Consider Renewables and Energy Storage:

With ever-changing climate conditions, a sustainability plan might also incorporate an environmental risk management plan. Supplementing existing energy supplied by utility companies with on-site solar-PV, geothermal or energy storage systems will improve resilience to unexpected events.

9. Continuously Monitor and Adapt:

Regularly monitor energy consumption patterns, asset performance, and the effectiveness of sustainability initiatives. Be prepared to adapt strategies based on real-time data and emerging technologies.

By systematically incorporating these steps into FM practices, organizations can not only reduce their carbon footprint but also contribute to the broader global effort toward sustainability. The journey towards a more eco-conscious future begins within the walls of each facility, guided by strategic asset management practices.