Presentation by John W. Conover IV at the "Green Building Focus Conference"

1. Unlocking the Benefits of Energy Efficiency
John W. Conover IV
Senior Vice President, Ingersoll Rand
President, Security Technologies Sector
Green Building Focus Conference
Charlotte, NC
Wednesday, April 20, 2011

2. Ingersoll Rand Mission
We are a world leader in creating and sustaining safe,
comfortable and efficient environments
Helps Satisfy
Critical Needs
Growing Resource
Urbanization Conservation
• Enhancing the human environment
• Improving quality of life
• Promoting energy efficiency and
sustainability
Feed • Increasing customer productivity
Growing Drive for
Population Competitiveness
Comfortable, Safe, Efficient Environments
Unifying Strategy — Guides Our Actions and Leads Our Growth
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3. Sustainability is Becoming a Differentiator
A company’s vision and strategic goals
Compliance and Creating Options
Avoiding Risks
Reducing Costs and Adding Value
• Satisfy customers • Stay in compliance • Enable entry into new
• Reduce accidents and markets
• Avoid supply chain
injuries risk • Create new products
• Reduce costs through • Avoid negative press • Establish partnerships
eco-efficiency to innovate and grow
• Maintain license to
• Avoid fees and fines operate • Stay competitive +
• Increase shareholder Differentiate
• Satisfy investors
value • Enhance brand
Conventional wisdom on sustainability continues to evolve
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4. Global Energy Environment is Dynamic
World energy consumption Urbanization
projected to grow 60% by 2030
Drive for
Competitiveness
Regulatory
Compliance
Source: Energy Information Administration
An unprecedented global energy and operating environment
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5. Buildings Have a Huge Carbon Footprint
79%
% of carbon emissions
attributed to existing buildings
<30%
But still
30% significant
30%
New York U.S. World
Buildings are the single largest contributor to global warming
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6. Why Energy Efficiency as an Energy Resource?
Energy Efficiency and Conservation Improvements Since 1973
Have Reduced Annual Energy Consumption by 52 Quads in 2008
Energy Efficiency and Conservation 52
Petroleum 37
Natural Gas 24
Coal 22
Nuclear Electric Power 8
Biomass 4
Conventional Hydroelectric 2
Geothermal, Solar and Wind 1
0 10 20 30 40 50 60
Quads
Energy Efficiency and Conservation 2008 Domestic Production Net Imports
Compared to other energy to Save Energy, June 2009 efficiency measures are:
Alliance resources, energy
Energy efficiency is clean, secure (homegrown)
and quicker to develop than other sources of energy
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7. Executive Survey Uncovers Issues with
Implementing Energy Efficiency Programs
• Partnership with Economist Intelligence
Unit
• Focus on C-level and senior execs
‒ 278 execs surveyed, wide range of
industries, worldwide
• Included online surveys and interviews
with leading organizations including:
‒General Electric
‒Tata Motors
‒Carbon Trust Standard Co.
‒World Resources Institute
Because energy efficiency programs require C-suite leadership,
funding and commitment – their perceptions are important
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8. Dilemma: Energy Efficiency and Strategy
• Nearly 80% of executives say energy efficiency will be more important to
their business in 5 years yet only 26% have ever done an energy audit
• 61% of non C-level execs said their organization does not do enough to
integrate energy efficiency into its strategy
Companies see value but struggle with implementation
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9. Responsibility Must be Assigned Across
Organization
• Energy efficiency still perceived to be
the CEO’s job
• Companies must appoint a respected
owner and drive accountability
throughout the organization
• Successful initiatives often have
senior leaders driving the campaign –
not necessarily the CEO
‒ Only 20% say an energy efficiency
manager or EHS manager is
responsible for energy efficiency
Few have dedicated sustainability staff
or energy management experts
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10. Companies Lack Measurement, Expertise
• Measurement helps monitor usage
and equipment efficiency, identify
cost savings
‒ Only 26% of organizations have
conducted an energy audit
‒ 15% audited by a third party
‒ 22% do no measurement at all
• With a proactive maintenance
approach – including energy
audits – companies can better
gauge energy usage and track the
efficiency of their equipment
Lack of expertise may hinder companies’ progress
Lack of in-house expertise hinders many companies’ progress
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11. Companies View Regulation Positively
• Business leaders generally see
benefit of regulations
‒ Large companies believe they
level the playing field and create
new markets
• 69% believe companies are only
meeting the “minimum” required
by policy – room for improvement
exists
• Almost 75% believe taxpayers
need to bear some of the cost of
energy efficiency strategies
Building owners welcome policy and incentives that
Companies welcome policies that enhance ROI of
enhanceefficiency measuresinitiatives
ROI of efficiency
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12. Energy Efficiency Seen as an Internal Issue
• Only a fraction of respondents
are working with their suppliers “In the present model of
‒ 8% said energy efficiency is a manufacturing automobile units,
priority for suppliers 70-80% is outsourced.
‒ 4% are working with their
suppliers on energy efficiency So it’s not enough for us to measure
our carbon footprint. We need to
also measure the carbon footprint of
• However, this is changing our suppliers.”
‒ Wal-Mart said it will require
suppliers to disclose their -A.S. Puri, Vice President , Tata Motors
environmental impact
Pressure mounts for vendor participation in energy initiatives
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13. Practices and Policies Drive Changed
Practices
• Make energy efficiency and sustainability
part of business strategy
• Assign responsibility across the organization
• Look to vendors to capture carbon footprint
Policies
• Change standards and codes to drive
minimums up
• Develop incentives to encourage
incremental investment that meets all
stakeholders’ needs
“For a long time, people thought it was all about technology. But what
we’re learning is that, really, it’s all about people. How do you get people
to do something differently?”
Gwen Ruta
Director & Vice President for Corporate Partnerships
Environmental Defense Fund
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14. Buildings Offer Promising Global Opportunity
• Buildings account for one- Current and Projected Building Sector Emissions by World
CO2 Emissions (MtC)
Region 2010 Emissions
third of world energy use, 180
0
150 2030 Emissions
GHG emissions 0
120
0
900
600
300
• GHG emissions from 0
North America, Central and Asia Latin Africa
Western Europe, Eastern Europe, America
buildings will double by 2030 and Pacific OECD Former Soviet
Union
Non-OECD/EIT*
GtCO2-eq/yr EIT
7
• Poorly designed buildings 6
OECD
World total
5
lock in inefficiencies for 4
decades 3
2
1
0
• Small investments cut energy
Energy Transport Building Industry Agricultur Forestry Waste
use 30-50% Supply s e
Issues argue for change in how we build,
operate, imagine buildings
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15. High Performance Building Solutions Exist Today
High performance buildings:
• Are safe, comfortable and efficient
• Help owners and occupants achieve their business
mission
• Use design and operating standards that are created,
measured and continually validated to deliver
established outcomes within specified tolerances
• Are created using a unique methodology – combining
financial, operating and energy analysis with
specialized service offers and available financing
• Meet specific standards for energy and water use,
system reliability and uptime, environmental
compliance, occupant comfort and safety and other
factors
Enhanced security, comfort, and building efficiency enables
growth and helps management deliver the business mission
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16. A Whole Building, Whole Lifecycle Approach
• Typical buildings have occupied lives of
50-75 years or even longer
• Operating costs account for 60-85% of building
lifecycle costs – compared to 5-10% for design
and construction costs
• High performance buildings reduce lifecycle
costs so organizations can invest in other
priorities
• Standards are created, measured &
validated continually to deliver desired
outcomes
• Standards are typically set for:
– Energy and water consumption
– System reliability
– Environmental compliance
– Occupant health, safety and comfort
Huge opportunities exist to improve building performance
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17. Top 25 Energy Conservation Measures
Major ECM Category ECM Type Technology/ECM Name Rating
Controls General/Special Upgrade to Direct Digital Control 100%
Industrial Compressed Air Implement Compressed Air Utility Management 100%
Water Reduce Use • Many, many Energy Conservation
Install Low Flow/Use Fixtures 96%
Controls General/Special Retro/Recommission Controls for Optimizing Savings 94%
Controls General/Special
Measure (ECM) technologies and
Install Lab Hoods Control - Flow Safe Lab Hoods 94%
Supply Side Management Manage Energy Supply applications  need a methodology to
Change Regulated Utility Rate/Tariff 94%
Water Smart Metering Install Smart Meters & software -- for Billing & Accuracy 94%
Electrical Lighting
assess and rate
Install Lighting Controls 92%
Electrical
Plant
Lighting
Boilers
• Methodology developed using Six Sigma
Replace T-8s for HiBays with T5s
Install Tankless/Instantanious Water Heaters
92%
92%
Supply Side Management Manage Energy Supply analysis processes and tools
Change to Interruptible Rates and Use Electric Generators 92%
Architectural Envelope Install Weather-Stripping 92%
Electrical Lighting • Evaluation process based on 5 key
Upgrade Fluorescent Fixtures w/ T8 or T5 Lamps and Electronic Ballasts 92%
Electrical Lighting customer “importance factors”
Retrofit Incandescent Lamps w/ Compact Fluorescent Lamps 92%
Electrical Lighting Replace Exit Sign w/new LED Fixture 92%
Plant Boilers – Savings potential, Practicality, Commercial
Adjust Burner as Regular Maintenance 92%
HVAC (Building/ Non-Plant) Unit Upgrade Convert CV to VAV viability, Risk management, Business 88%
HVAC (Building/ Non-Plant) Unit Upgrade Convert Dual Duct to VAV 88%
Electrical Lighting differentiation
Replace HID HiBay fixtures with T5s or T8s 86%
Electrical
Architectural
Lighting
Roof
Water Source Heat Pump
• Score of 0-100% with 100% being the
Add LED night lights in halls
New Construction with Green Roofs (Plants)
86%
85%
Plant Systems best ranking
Install Water Source Heat Pump System 83%
Plant Motors/Pumping Install VFD/VSDs for Pumps 81%
Controls Resetting Reduce Outdoor Air To Design Level 78%
Controls Resetting CO2-Based Demand-Controlled Ventilation 78%
Use Six Sigma methods to choose best energy measures
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18. Compelling Case for Improving Lifecycle
Performance
• Energy efficiency makes • Link the building to its primary
more sense than ever business mission
• Environmental performance • Determine the funding strategy
is becoming more critical • Understand energy
• Organizational performance conservation measures and
and employee productivity their payback
drive value, ROI • Focus on total cost of
• Effective service strategy ownership over occupied life
maintains lifecycle • Conduct the financial analysis
performance – including cash flow
Moving the building sector toward High Performance Buildings
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19. HPB Based Success Story
TIAA-CREF Headquarters – New York
Solutions Applied:
• Analyze building systems, energy use, rate
structure and procurement methods
• Recommend mission-focused ECMs
• Design & install upgrades
– State-of-the-art chilled water system
– Rooftop thermal storage system
– Reprogrammed central automation control
system
Results:
• Infrastructure upgrades will save an estimated $765,000 per year in energy
and operating costs and a 25% internal rate of return for TIAA-CREF.
• The efficiency improvements are avoiding 6.1 million pounds of carbon
dioxide emissions -- the equivalent of removing 560 cars from the road, or
planting 828 acres of trees.
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20. Internal Ingersoll Rand Energy Audits
• DOE Save Energy Now LEADER
Initiative
– Over $4 million in energy cost
savings
– Program relies on skilled employee
volunteers
– Three tiers of energy audits
• Treasure Hunts
• Expanded Energy Audits
• System Specific Audits
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21. Bottom Line for Addressing Energy Efficiency
• Energy efficiency must become part of business strategy
• Success depends on leadership, accountability and expertise
• Climate change cannot be effectively addressed without including
commercial building sector
• Our growing populations will seek greater security, efficiency and
integrated approaches to increase quality of life.
• Technology exists today to create High Performance Buildings that
can mitigate GHG emissions while providing long term ROI for
building owners
High Performance Buildings help organizations
achieve their mission
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22. Thank You
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