2011 eei-europe-results

THE ENERGY EFFICIENCY INDICATOR A global survey of decision makers responsible for energy use in buildings – examines trends in priorities and practices •5th annual survey led by the Institute for Building Efficiency, with the International Facility Manager Association (IFMA) and the Urban Land Institute (ULI) •Respondents reached through independent survey provider Survey.com and members of strategic partner organizations •Global surveys completed during March/April 2011, reaching nearly 4,000 respondents. Global results to be released June 16, 20112 Institute for Building Efficiency | www.InstituteBE.com

THE EEI SURVEY IN EUROPE 6 countries, 6 languages, 857 respondents Other 3% Spain 14% United Kingdom 26% France 225 12% 157 105 100 Italy Poland 15% 12% Other Europe: 29 112 18% 116 Germany Up from 746 respondents in 20103 Institute for Building Efficiency | www.InstituteBE.com

WHO ARE THE EUROPEAN RESPONDENTS? Criteria: Other Industrial 15% Owner/ 17% 1. Must have budget responsibility for their C-level Proprietors Executives 33% organization’s facilities. Institutional 18% 19% Commercial Vice Facility 64% 2. Job responsibilities must Presidents Managers include reviewing or 15% 19% monitoring energy usage, and/or proposing or Respondents by job title and sector approving initiatives European respondents to make organization’s • 50% reported facilities are in high-density urban areas facilities more efficient. • 69% are responsible for a single building or campus (as opposed to a nationwide portfolio) • Evenly distributed across sectors, top industry construction/engineering (11%)4 Institute for Building Efficiency | www.InstituteBE.com

ENERGY EFFICIENCY MOVING FORWARD IN EUROPE Challenges and opportunities remain 1. Steady growth The 2011 survey shows an increasing emphasis on managing energy, driven by market and policy conditions 2. Energy efficiency in motion Respondents are taking concrete actions to increase efficiency and government policy is making an impact on decisions. 3. Challenges and opportunities There continue to be significant barriers to pursuing energy efficiency in European buildings. Financial capital and human capital are limitations.5 Institute for Building Efficiency | www.InstituteBE.com

ENERGY EFFICIENCY INDICATOR 2011 EUROPE RESULTS Steady Growth for Clean Energy6 Institute for Building Efficiency | www.InstituteBE.com

ENERGY STEADILY GROWING IN IMPORTANCE Gradual increase in emphasis since 2010 Year-over-year trends in attention organisations are paying to energy efficiency and the importance of energy management 2011 Paying a lot more attention to 30% 2010 energy efficiency now than a year ago 26% 61% Energy management is extremely or very important 55% 0% 20% 40% 60% 80%7 Institute for Building Efficiency | www.InstituteBE.com

ENERGY IMPORTANT ACROSS EUROPE Identified as a priority in all target countries How important is energy management to your company/organisation? 100% Not at all important 80% 34% 33% 34% 35% Not very 47% 46% important 60% Somewhat important 39% 40% 43% 45% 54% Very important 32% 32% 20% 23% Extremely 14% 15% 14% 11% important 5% 0% France Germany Italy Poland Spain UK8 Institute for Building Efficiency | www.InstituteBE.com

RISING PRICES EXPECTED ACROSS EUROPE More expecting price increases than in 2010 2010 Do you believe the price of energy will increase over the next 12 months? 2011 80% 60% 86% 77% 85% 84% 40% 79% 73% 77% 79% 80% 68% 64% 64% 62% 50% 20% 0% Europe France Germany Italy Poland Spain UK9 Institute for Building Efficiency | www.InstituteBE.com

GOAL-SETTING COMMONPLACE Strongest in the public/institutional sector Public Internal Any goal goal goal In the next year, European Both energy & respondents’ organizations carbon 14% 25% 39% plan to reduce energy use by Either energy or an average of carbon 33% 50% 83% 13% Fraction of respondents with a publicly-stated carbon goal 40% In contrast, 35% 6% say they do not plan 30% to reduce energy use 25% 20% 35% 15% 10% 23% 26% 8% are not seeking carbon emissions reductions 5% 0% Commercial Industrial Institutional10 Institute for Building Efficiency | www.InstituteBE.com

RISING EXPECTATIONS FOR POLICY Most respondents looking to country governments How likely is significant government policy mandating energy efficiency and/or carbon reduction within the next 2 years? 0% 20% 40% 60% 80% 100% Expected likelihood of national policy (Extremely or very likely) National government 20% 28% 27% Country 2011 2010 Spain 57% 50% UK 56% 55%State/provincial government 10% 24% 34% Poland 44% 45% Germany 44% 43% Local government 11% 19% 30% France 42% 37% Italy 23% 48% Extremely likely Very likely Somewhat likely Not very likely Not at all likely Dont know11 Institute for Building Efficiency | www.InstituteBE.com

ENERGY EFFICIENCY INDICATOR 2011 EUROPE RESULTS Energy Efficiency In Motion12 Institute for Building Efficiency | www.InstituteBE.com

MORE CERTAINTY AROUND GHG REDUCTION Energy efficiency in buildings still top strategy What are your organisations top strategies for reducing its carbon footprint? Improve energy efficiency in buildings 39% 34% Install onsite renewable energy systems 10% 11% Purchase green power or renewable electricity 8% 8% Implement alternative ways of working (e.g., … 5% 8% Improve efficiency in vehicle fleet 6% 6% Supply chain carbon reductions 2% 5% Use alternative transportation fuels or electric vehicles … 4% 4% Real estate portfolio consolidation 4% 2% Purchase carbon offsets 2% 1% 2011 No prioritization amongst strategies 8% 18% 2010 Dont know 2% 10% 0% 10% 20% 30% 40% 50%13 Institute for Building Efficiency | www.InstituteBE.com

PURSUING ALL TYPES OF EFFICIENCY Lighting still most common, other measures reported as well Which of the following energy efficiency measures has your company/organisation adopted in the last 12 months? (Select all that apply) Lighting improvements 61% Heating, ventilation, air conditioning (HVAC) and/or 51% controls improvements No-cost/low-cost or behavioral improvements 37% Building envelope improvements 27% 91% of respondents Energy supply and/or peak demand management 26% Onsite renewable energy 22% have adopted at least one Smart grid or smart building technology 18% energy efficiency measure None 9% 0% 20% 40% 60%14 Institute for Building Efficiency | www.InstituteBE.com

EUROPE MOVING TO A NEW ENERGY ECONOMY Improvements expected across the building Which of the following on-site technologies do you expect to have the greatest increase in market adoption over the next ten years? (Select up to three) Advanced building materials 34% Lighting technologies 34% Solar photovoltaics (PV) 30% Smart building technology 22% Electric and plug-in electric vehicles 22% Concentrating solar power (CSP) 17% Geothermal heat pumps 14% Small wind generators 13% Biomass generators or co-gen units 11% Infrastructure Advanced cooling technologies 10% Technology Stationary electric energy storage 9% Renewables Thermal storage 8% 0% 10% 20% 30% 40%15 Institute for Building Efficiency | www.InstituteBE.com

CHANGING MOTIVES FOR ENERGY EFFICIENCY Incentives up, policy down “Extremely” or “very” significant influences on energy efficiency decisions Driver 2011 2010 Rank Rank • Cost savings continues as dominant driver for energy Energy cost savings 1 1 efficiency Gov’t/utility incentives/rebates 2 6 • Government and utility Increasing energy security 3 N/A incentives rise in relative Greenhouse gas reduction 4 2 importance Customer attraction/retention 5 4 • Energy security is a major Enhanced brand or public image 6 5 driver Existing government policy 7 3 Pending/anticipated policy 8 7 • Slight decrease in focus on greenhouse gas emissions Attracting, retaining employees 9 9 Investor reporting demands 10 8 Attracting, retaining tenants 11 1016 Institute for Building Efficiency | www.InstituteBE.com

GREEN BUILDINGS ON THE RISE Certification gaining momentum in all countries 2010 Fraction of respondents with at least one green certified building 2011 40% 30% 20% 40% 38% 27% 28% 32% 30% 31% 10% 19% 18% 19% 16% 15% 16% 10% 0% Europe France Germany Italy Poland Spain UK an additional 22% have incorporated green building elements17 Institute for Building Efficiency | www.InstituteBE.com

ENERGY EFFICIENCY INDICATOR 2011 EUROPE RESULTS Challenges and Solutions18 Institute for Building Efficiency | www.InstituteBE.com

FINANCIAL AND ORGANISATIONAL BARRIERS KEY Variation across sectors What is the top barrier to pursuing energy efficiency for your company/organisation? Lack of funding to pay for 44% 24% improvements 29% 15% Insufficient payback/ROI 26% 19% Uncertainty regarding 14% savings/performance 7% 15% Average ROI payback required Landlord/tenant split incentives 3% 6% between 2.5 and 3.5 years 11% Lack of technical expertise to evaluate 7% Institutional 16% or execute projects 9% Industrial 7% Lack of awareness about opportunities 12% Commercial 7% No organizational ownership/dedicated 7% 10% attention to managing energy efficiency 7% 0% 10% 20% 30% 40% 50% 44% of European respondents report that their organization uses Life Cycle Analysis19 Institute for Building Efficiency | www.InstituteBE.com

FUNDING PROJECTS IS A PROBLEM Majority looking to capital budget 45% of respondents identify insufficient budget as a top financial barrierWhat is the top financial barrier to pursuing energy efficiency for your company/organisation? 73% Insufficient internal capital budget 50% 49% 6% Difficulty obtaining external financing at 11% attractive rates and terms 16% Minimal experience with 8% Insufficient government or utility incentives 16% 13% funding projects with external capital 8% Difficulty identifying appropriate financing 11% options 10% 2% Institutional Inability to secure external financing 8% Industrial 8% 2% Commercial Balance sheet debt limitations 4% 5% 0% 20% 40% 60% 80%20 Institute for Building Efficiency | www.InstituteBE.com

STRONG PREFERENCE FOR INTERNAL FINANCING Incentives common as enhancers to existing budgets Which options does your organisation use to pay for energy efficiency and renewable energy projects? 40% Internal operating budget 31% 37% Internal capital budget 31% 25% Grants, rebates, or tax credits 22% 24% Power purchase agreement (PPA) 19% 20% Utility on-bill financing 15% 19% Energy or climate specific set-asides 19% 19% Project financing from a financial institution 15% 19% Shared savings agreement 16% 15% Environmental upgrade charge in property tax 13% 13% Last 24 months Project financing from the sale of a bond 15% 2% Other (specify) 2% Next 24 months 19% Not applicable 20% 0% 20% 40% 60%21 Institute for Building Efficiency | www.InstituteBE.com

EXTERNAL FINANCING ENABLES MORE EFFICIENCY Longer payback measures more common for respondents who have used external capital Which of the following energy efficiency measures has your company/organisation adopted in the last 12 months? (Select all that apply) Lighting improvements 63% 59% Heating, ventilation, air conditioning (HVAC) and/or 55% controls improvements 47% Building envelope improvements 36% 19% No-cost/low-cost or behavioral improvements 36% 38% Energy supply and/or peak demand management 34% 19% Onsite renewable energy 29% 15% Smart grid or smart building technology 25% External Financing 11% None 2% Internal Budgets Only 16% 0% 20% 40% 60% 80%22 Institute for Building Efficiency | www.InstituteBE.com

HUMAN CAPITAL IMPORTANT AS WELL Respondents need people with expertise and bandwidth 33% of respondents identified lack of technical expertise among the top three barriers. 31% of respondents reported that there is no organizational ownership for energy efficiency. How have energy efficiency activities at your organisation impacted personnel decisions? No effect on personnel decisions 41% Worked with more individuals from contractors/vendors 24% Repurposed staff from other areas 23% Respondents slow to invest in Hired more dedicated staff 13% more people; contracting and repurposing staff. Retained fewer dedicated staff 7% Worked with fewer individuals from contractors/vendors 4% 0% 20% 40% 60%23 Institute for Building Efficiency | www.InstituteBE.com

SOME RESPONDENTS LOOKING OUTSIDE FOR HELP Uncertainty around trusted source of advice Who would you be most likely to ask for advice on energy management decisions? Energy consultant 30% In-house experts 13% Energy Service Company (ESCO) 11% Product vendor 8% Local utility 8% 30% relying on consultants; many Government agency 7% other sources of advice available External colleagues or peer group 7% Industry association 6% No trusted source or dont know 10% 0% 20% 40%24 Institute for Building Efficiency | www.InstituteBE.com

CONCLUSIONS AND IMPLICATIONS 1. Steady growth Widespread interest in energy, from market, technology and policy perspectives 2. Energy efficiency in motion Clear signs of traction in green buildings, government incentives, and prioritization of strategies 3. Challenges and opportunities • Executives looking to internal funds, augmented by incentives …Can external capital unlock more efficiency? • Need more people to do the work, but slow to hire …Can external expertise be leveraged for more impact?25 Institute for Building Efficiency | www.InstituteBE.com

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2011 eei-europe-results

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