The City of St. Louis is at the forefront of cities taking significant strides to enhance the energy efficiency of buildings. The recent implementation of the Building Energy Performance Standards (BEPS) Ordinance in 2020 has had a wide-reaching impact on city buildings larger than 50,000 SF, setting minimum targets for their energy consumption. This presents a crucial opportunity for these buildings to make necessary improvements. Going beyond mere compliance, these upgrades can yield extensive benefits for those who make informed choices and investments.
To provide an in-depth understanding of the key information that building owners, operators, facilities teams, and contractors should be aware of, we conducted interviews with two experts. Malachi Rein, Director of Building Energy Exchange - St. Louis (BE-Ex STL), and Chris Ruth, Building Controls Manager for Integrated Facility Services and the 2023 Board Chair of the Missouri Gateway Green Building Council, share their valuable insights in this exclusive interview.
Malachi Rein, Director of Building Energy Exchange - St. Louis
What are the most important things building owners and operators need to know about what is expected of them with the new BEPS regulations?
MALACHI: BEPS requires improvements to our buildings over time to reduce energy consumption. For buildings that do not already meet the targets set by BEPS, the deadline to demonstrate improvements is 2025 but next year — 2024 — benchmarking/utility data will be evaluated for compliance. While St. Louis City buildings will need to improve their energy efficiency, BEPS leaves the choice of which projects to pursue. Smart building owners and operators can leverage the investment they will make in efficiency projects for real returns. Partnering with qualified consultants and contractors allows you to find and fix inefficiencies, upgrade aging and low-performing systems, and protect your investment — not only on utility bills, but also through marketable value and increased comfort, health, and productivity of tenants. These benefits unlock funding that has been tied up in inefficient operations, can improve employee retention, relieve pressure on short-staffed maintenance departments, and ultimately allow your buildings to support your goals far better than they do now.
What do you suggest to people who are trying to sort through their options and make the best decisions for improving their building's efficiency — to satisfy the BEPS regulations and/or for other benefits?
MALACHI: The first thing, which is required by the City’s Building Energy Awareness Ordinance, is to track your buildings' energy performance and compare it against other similar buildings. More than budgeting for bills, energy benchmarking is a way to show how efficient or inefficient your building is. Once you understand where you stand, you can develop a strategy for solving inefficiencies. This can start with low-cost operations and maintenance work or you can engage with a reliable firm to do an energy audit or retro-commissioning study on your buildings. Once you have this information, you can prioritize projects by their ROI, and/or combine it with your existing capital strategy to make efficiency a priority as you replace systems that are already reaching their end-of-life.
Chris, with your IFS Building Automation hat on, what does the process of working with companies to evaluate how to become more energy efficient involve?
Chris Ruth, Building Controls Manager with Integrated Facility Services
CHRIS: From our stance, step two after benchmarking is an energy audit. You can have the same type of equipment, the same layout of equipment at three different buildings but all of those buildings are performing differently. So we have to do that energy audit and, and take a look at everything that is impacting that building.
Inevitably the second question after ‘Where do I get started’ is ‘What is it going to cost?; That is a loaded question but, once we have a full understanding of where your energy is going, where it's being wasted, and where we can save, we can then figure out the energy conservation measures that we need to take, show the reduction that we expect from those measures and determine what it is going to cost.
Do you provide multiple scenarios and strategies?
CHRIS: Yes, usually we can provide a couple of different options depending on how big of a differential they have to overcome. There are different BEPS compliance paths and variations in everybody's approach, different levels of priority, and variability in what people are willing to spend.
Sometimes it is very obvious. You look at the report and say ‘This is what you need. You're over by X life of the equipment, this one piece of equipment is contributing to X percent of the EUI (Energy Use Intensity) and this is your fix.’ But we try to give as many different avenues as possible. Often an easy, lower-cost approach involving, more or less, a labor purchase is retro-commissioning the systems. Retro-Commissioning is the process of verifying the proper and efficient functioning of a building's systems through testing and data collection. Once the data is collected, it is checked against the original design specification or the standard operating specs. Discrepancies and deficiencies are noted and then adjustments and repairs are made to return the system/building to proper working order. So, the options often range from that to massive capital projects where you change everything out.
Do you help them develop a more comprehensive, long-term strategy?
CHRIS: We can help with long-term facility planning — a five-year or ten-year plan. We look at everything that they've got to consider over a longer period and figure out what needs to be done in the immediate term for compliance. But sometimes our conversation is specifically about compliance.
It is obviously important that the contractor you work with understands the compliance requirements because there is a lot of complexity. One potential misconception a building owner could have is that they are fine because they automatically comply in the first cycle. But, as the efficiency of more buildings in the city improves, the average performance among the buildings will go up and a building may not comply for the next cycle. Additionally, if a building is short-sighted and invests in small gains, they may not be in compliance in a cycle or two and have to invest more when it could have been cheaper and they could have reaped more benefits if they did a more impactful project earlier.
Can you speak to why it's important to have someone advise you who understands compliance when making these decisions?
MALACHI:: You have to be looking at the big picture. If you're buying a piece of equipment today, you're not going to replace it for maybe 20 years. That’s five BEPS cycles with a piece of equipment. If efficiency wasn’t a priority, it can work against your compliance in later cycles. You will be trying to catch up in other places because you're probably not going to dedicate the capital funding to replace equipment that's only halfway through its life.
BEPS is trying to drive the entire city towards a more efficient place using local data. So, if everybody else is making better decisions, you are going to get left behind if you didn't make a good decision when you had the opportunity. That's no good. It's going to leave future contractors in a place where they can't offer you the holistically best solutions for the building. This is about considering lifecycles, not just upfront costs. Consider the ROI — if you do, you’ll find that it is there.
CHRIS: If I can build onto that. One of the things that we've been talking about here is the early adopter with a building that is say 20% or 50% ahead for the next cycle. You are not putting a lot of faith in your market peers if you get just above the threshold. You may have done a lot, but in the grand scheme of things, you haven't done much if your market peers have raised the bar and now you've got to do another capital project in the next cycle.
Sometimes you are choosing between spending more right now and not having to do a capital project over a capital project every cycle. We've been talking about that quite a bit — ‘why don't we build that out a little more, and then we don't have to talk about this for ten years
If you make that step now, you've got the whole next cycle to see the benefits instead of waiting until this cycle gets down to the eleventh hour and making the changes. Essentially, you've got four years wasted because you didn't take that extra step earlier.
MALACHI: I think we should emphasize the difference between a “low-hanging fruit” project and a project where you're investing in major infrastructure. Upgrading your lighting to LEDs, for instance, is a great project. It has a big impact on your electric bill, a short ROI, and limited impacts on your operations during installation. HVAC equipment, on the other hand, can be a big capital expense with a lot to navigate. Unless you are doing a big project already, hit that low-hanging fruit first. That being said — know that it’s a stopgap. You need to make efficiency-based decisions with the money you're going to spend on capital replacements and upgrades anyway. So, when it's time for that part or piece of equipment to go out, you should be prepared to make a good investment. This is all about making good decisions.
CHRIS: I can build on that one too. I think one of those good decisions that we're trying to stress, and is lost in a lot of these conversations, is the operation and management beyond the initial purchase. The thought is that ‘we're going to do a capital project, put in all this new equipment and then just walk away.’ There's so much that has to be done in the interim — ongoing commissioning and inspection to make sure that everything is at peak performance.
We've heard that a building never runs as well the day that it started up. You're fighting this downhill battle if you don't maintain your systems. How you sustain the building beyond that initial investment is one of the good decisions that Malachi was just talking about.
Especially with an in-house team whose focus has been dealing with emergencies with dated equipment, making these types of improvements can be an opportunity to get into a preventative maintenance mode.
MALACHI: True. A lot of teams are putting out fires at best. Getting ahead is not even on the radar. When a facilities team sees the benchmark, it can make them feel like they aren’t doing a good job. They are doing an excellent job balancing existing conditions, funding and phone calls about comfort issues. They need more resources. We're on the same team as the facilities staff and are offering them tools to get buy-in from building owners to make the investments that they need and that benefit the building as a whole.
What's the next deadline for the BEPS cycle?
MALACHI: Compliant buildings have been submitting benchmarking data already, which allowed the City to set targets. The end of the first BEPS cycle is 2025, meaning that 2024 data will be measured against that target. Ideally, you will have projects in the pipeline this year. You can also file an eligibility application for a Custom Alternative Compliance Path (CACP) by July 1st if you meet basic requirements but will have difficulties complying with BEPS. If accepted, you can develop and enact your plan to create a real impact on your efficiency per an agreement with the City.
Chris, what are you telling building operators is most important to do now?
CHRIS: We've been talking a lot about the long — 40, 50 to 60 week — equipment lead times. All of 2024 is taken into consideration for that assessment. So, if you wait until the end of the summer, for instance, and you don't get your new boilers until July 2024, then you've got six months’ worth of bad data that's gonna skew your 2024 total.
What is your message for building owners as we head into the second half of 2023?
MALACHI: When you look at a plot of the City’s benchmarking data you can see that most buildings are within striking distance of their BEPS target. If those buildings get the low-hanging fruit they may meet their compliance goals. At the same time, you need to make a capital plan using an energy audit or retro-commissioning study so that you have a firm strategy moving forward. Together you can begin to take advantage of the rewards of doing energy efficiency projects. Talk to your utility reps about incentives, look at financing opportunities, and watch the funding coming from the Inflation Reduction Act. Optimizing your portfolio- making performance and efficiency improvements is good business. It is wise asset management. It creates local jobs, invests in the local economy, and has good payback for you. You don’t often have the opportunity to tie so many good things together while you get rid of existing headaches. Regardless of BEPS, if you own, rent, live, or work in buildings then they impact you. If we step back and take a look, there are absolutely ways to come out on top.
If your organization is ready to begin a conversation and isn’t sure where to start- check out the resources that at www.be-exstl.org.
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Malachi Rein has a passion for creating a more sustainable built environment. With a B.S. in Architectural Engineering from Missouri S&T, he brings experience in facilities management, operations, and project management. A lifelong resident of the Saint Louis region, he firmly believes that our buildings matter and that we can empower positive change that impacts our balance with our planet and the lives of real people.
In his role as Board Chair of MGGBC, Chris Ruth works to advance the organization’s mission to improve human health, support economies, and protect the environment in the region by educating and advocating for green building and sustainability. He has more than 18 years of experience designing and managing building automation systems to improve the energy efficiency of buildings as a Controls Manager for Integrated Facility Services.
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Feature Image Credit: iStock