PRESS RELEASE FROM
Gridium leverages two utility programs to finance otherwise unbudgeted equipment and to drive deep energy savings for the building and the electric grid
SAN FRANCISCO – December 10, 2020 – Gridium announced today that its energy efficiency retrofit project, constructed at 550 Montgomery St. on behalf of Downtown Properties, is the first to leverage PG&E’s Commercial Whole Building program, a performance-based program that financially rewards customers for every unit of energy saved. The upgrades were fully funded by PG&E’s On-Bill Financing program, bypassing the building’s capital budget to achieve efficiency goals and deliver an improved environment for tenants. As constructed, this project is expected to improve building operations, exceed project costs with energy savings in five years, and reduce annual energy costs by $0.26/sf., or 15% of total energy costs.
PG&E’s Whole Building Performance Based Program Unlocks Deeper Savings
“Our new program measures efficiency savings with innovative Normalized Metered Energy Consumption (NMEC) methods, leveraging the advanced technology used by SmartMeters. This first project shows that measuring energy at the meter is the next crucial step towards unlocking deeper energy efficiency. We can now incentivize project-based savings we see at the meter, while helping ensure the savings persist and that everyone’s economic objectives are met,” said Aaron August, VP, Business Development & Customer Engagement for PG&E.
The Normalized Metered Energy Consumption approach measures changes in energy use at the whole building level. This means an energy upgrade project can be comprehensive and have lower transaction costs for building owners – 550 Montgomery’s retrofit includes LED lighting, high-efficiency electric motors, and boiler controls. And since the savings are being measured over time, incentive payments can be made over time as energy efficiency is delivered to the electric grid in real-time.
Furthermore, the NMEC measurement approach also enables tailored building baseline energy use calculations. Accounting for non-routine events is now possible, such as the drop in energy used by 550 Montgomery St. due to COVID-19 related shifts in occupancy.
“Adding value is foundational in our approach to building ownership and leveraging two innovative PG&E programs to boost our sustainability is an exciting way to accomplish these goals,” said S. DeMarco Carter, VP of Property Management at Downtown Properties. “In addition to the economic benefits of this retrofit, we hope to motivate our tenants to further consider their energy efficiency practices and sustainability efforts. Partnering with Gridium on the project really simplified the entire process.”
Gridium’s turnkey project development offering starts with its market-leading energy analytics software and a free, touchless initial assessment. “We handle the Investment Grade Audit, coordinating with PG&E and meeting the various programs’ requirements, and monitoring for persistent performance over time,” said Aaron Panzer, Managing Director, Gridium Alpha. “It’s exciting to break new ground and advance the standard for a NMEC-powered energy project in these operating conditions alongside the teams at Downtown Properties and PG&E.”
On-Bill Financing Aligns Tenant Benefits with Ownership, Bypassing the CAPEX Budget
“Our goal is to create signature spaces for tenants where they can do their best work,” said Dennis Collins, Property Manager at Downtown Properties. “Gridium’s turnkey project delivery means they handle the upgrades while we stay focused during this uniquely challenging period for everyone. And with PG&E’s On-Bill Financing Program, this historic building can modernize its systems without impacting our capital budget.”
The project included upgrading the remaining 50% of interior lighting to high-efficiency LED lights, offering higher-quality light at about 40% of the energy. A makeup air unit on the roof was retrofitted with two new high-efficiency motors and controls, allowing for reduced fan speeds that precisely match ventilation demands throughout the day and across the work week. Additionally, a hydronic heat boiler controller was installed to enable outdoor air resets and sequencing control strategies that produce energy savings.
PG&E’s On-Bill Financing Program was used to fund this comprehensive efficiency project, which was otherwise unbudgeted at the building. PG&E finances the energy upgrades to match the energy savings, then places loan repayment services charges on the monthly utility bill. The loan is sized this way to provide bill neutrality while enabling proportionate cost recovery. Tenants benefit from a better built environment without increasing total utility costs.
“Downtown Properties is taking action on energy efficiency in a way that’s inspiring to tenants and to the market” said Tom Arnold, CEO at Gridium. “The company’s leadership is mirrored in PG&E’s innovative efficiency programs – OBF helps solve the split incentive for commercial property owners, while the NMEC-powered whole building incentive pays buildings to dig deeper for savings and allows Gridium technology to show all stakeholders the real and achieved savings to the Grid.”
About Gridium Inc.
Buildings use Gridium to save energy, finance retrofits, and streamline operations. All told, the company directly serves over 300 million square feet of buildings across the United States, and with Gridium, these buildings save millions of dollars on electricity, gas, and water utility bills, extend the useful lives of their assets, and data-drive their sustainable operations.
About Downtown Properties
Downtown Properties is a multi-faceted real estate investment, management and development company focused on uncovering opportunities and adding value at every point, from every angle. An associate of Gaw Capital Partners, Downtown Properties has over 20 years of expertise in all aspects of real estate, with a portfolio of commercial, residential, land, hotels and resorts that span across Los Angeles, San Francisco, New York and Hawaii. The company’s passion for creating signature experiences has produced a list of acclaimed properties – from the likes of Los Angeles’ Bradbury Building to The Hollywood Roosevelt Hotel.