ENERGY STAR Score Updates Are Coming Sustainable Investment Group

ENERGY STAR Score Updates Are Coming

June 10, 2021

By Danielle Wilmot
LEED Green Associate, WELL AP, EIT
Manager of Implementation
Blue Ocean Sustainability

high rise buildings with the ENERGY STAR logoFor those of us involved in the ENERGY STAR commercial buildings program, it may feel like just yesterday that scores for most building types went through an update. (For Hospitals, that’s true – scores for General Medical and Surgical Hospitals were just updated in February 2021.) For stakeholders involved with Office buildings, K-12 Schools, Warehouses, Retail, and a variety of other building types, the score updates actually happened all the way back in Summer 2018…sort of.

Here’s a recap of the timeline:

  • Spring 2016: EPA begins analysis of CBECS 2012 data and announces that scores for a variety of building types (including Office, Retail Store, and K-12 School) will be updated soon. Over the next two years, update webinars are held, stakeholder input is gathered, and the score development team (of which I was a member at the time) is hard at work.
  • Spring 2018: Scores are close to being finalized, and the effort to start programming them into Portfolio Manager begins. EPA puts out a lot of messaging to ensure that stakeholders know what’s coming (including the fact that scores for a lot of properties are likely to drop, sometimes relatively dramatically – more on that later). EPA waives some normal rules to ensure that properties are able to apply for 2018 certification before the updates go into effect, and they advise everyone to download any reports and documentation reflecting their current scores as needed, since those will no longer be available post-update.
  • July 2018: The ENERGY STAR commercial building certification program sees its highest-ever application submission volume as thousands of applicants heed EPA’s call to get their applications in before the upcoming score changes. (As head of the review team at the time, these were some VERY busy weeks.)
  • August 2018: At long last, the scores are released in Portfolio Manager. As predicted, a lot of scores dropped. A lot of scores dropped by a LOT.

Let’s pause the timeline here to talk about that score drop and why it happened.

The ENERGY STAR scores are essentially a percentile comparison of your building against other similar buildings in the U.S. If your building has a score of 50, it means your building performs better than about 50% of similar buildings nationwide. A score of 75 or higher indicates that your building is in the top 25% of performers (75 is also the threshold for eligibility for ENERGY STAR certification). However, it’s important to remember what your building is actually being compared against.

The August 2018 score updates were based on the 2012 Commercial Building Energy Consumption Survey (CBECS), a survey that’s typically conducted roughly every 3-4 years by the U.S. Energy Information Administration (EIA). In this case, the energy and use data for buildings in the survey reflect buildings’ activity from 2012. It takes a few years for EIA to gather, process, weight, and QA the data before releasing them to the public, and then another few years for EPA to review and analyze the data and generate the ENERGY STAR score models for each property type. So already, by the time the scores get released, buildings are being compared against data that are several years out of date.

That’s not the biggest issue with the 2018 release, though – if everyone is being compared to 6-year-old data, at least everyone is on the same footing. The biggest issue with the 2018 release was the length of time between the 2012 survey and the previous survey.

There were 8 CBECS surveys administered between 1979 and 2003, with no more than 4 years between consecutive surveys. After 2003, though, there was a 9-year gap until the next survey in 2012. Let’s talk a bit about that 9-year gap.

EIA did conduct a 2007 survey – however, for a variety of reasons (including the use of an experimental survey framework and sampling method), that survey had to be tossed out. Another survey was planned for 2011, but that had to be pushed to 2012 due to a federal funding shortage for EIA. Thus, we have an unfortunate 9-year gap between the 2003 and 2012 surveys.

This brings us to the primary issue with the 2018 score updates: The previous scores were based on 2003 data, and the new scores on 2012 data. That means that buildings went from being compared to 2003 data straight to being compared against 2012 data, without an intermediate step in between (which they would have had if the 2007 survey had survived). As most in the industry know, building technologies can change a lot in nearly a decade, especially a decade in which technologies improved dramatically and sustainability became a more prominent consideration for many building owners and managers. A building might score in the 80s when compared against 2003 data, but in the 60s or lower when compared against the much more efficient 2012 building stock. If they had had that 2007 comparison as a step in between, maybe they would have scored somewhere in the 70s at that point – still a drop, but a less-dramatic one, and (importantly) one that gives them some warning and some time to make improvements before being compared against an even-tougher standard a few years later.

So, back to the timeline:

  • September 2018: Some people are not happy at all. They complain to EPA about the dramatic score changes and how they will interfere with business. EPA, out of an abundance of caution, decides to conduct a review period for the new scores to make sure they’re up to the usual rigorous standards. As part of this review period, they suspend certification for all property types affected by the changes. This, predictably, also makes a lot of people very upset.
  • May 2019: After MUCH longer than anyone had anticipated, EPA starts re-opening certification for affected property types…with no changes made to the scores so far. (This was validating for those of us on the score development team, since it confirmed that our first effort at the score models was, indeed, our best effort).
  • July 2019: The last few property types are finally re-opened for certification, including Offices (which make up around half of all ENERGY STAR certified buildings). After nearly a year – and more webinars, work sessions, stakeholder meetings, and analyses than I care to remember – the only change that came as a result of the review period was a minor change to the Office model that would re-introduce Heating Degree Days. (HDD had previously been left out of the update due to lack of statistical significance, but was ultimately deemed necessary to address lower scores in colder climates and was thus shoehorned into the model.)

So, what’s next?

EIA began conducting their latest CBECS survey in 2018, a full 6 years after the last one in 2012 (so not as long as the prior 9-year gap, but still nearly twice as long as the 3-4 year average gap between historical surveys). This means we can likely expect another large-ish drop in average scores for many property types, as building efficiency has only continued to improve overall in the last decade.

EIA anticipates releasing detailed microdata on building characteristics by August 2021, with detailed energy consumption information being made public in Summer 2022. EPA usually receives the data a little bit earlier than the public, so we can expect the ENERGY STAR score development team to start working on the next round of updates probably by next spring. If the previous timeline is any indication, we can expect scores to be released about 2 years later (though I would not be surprised if the process goes faster this time around, so I’d be ready for new scores as early as 2023, though they’re more likely coming in 2024).

That may sound like a long time in the future, but 2-3 years is really not that long when it comes to building efficiency upgrades. A full years’ worth of data is required for an ENERGY STAR score, so if scores are released in, say, Fall 2023 (an early-but-not-unrealistic estimate), those scores will take into account data from late 2022, which is only about 18 months away. This means building owners and managers have about 18 months to do the following:

  • Evaluate their current energy consumption;
  • Make some educated guesses about how well they’ll do against the tougher 2018 standard (compared to the current 2012 standard) when the scores change;
  • Decide on appropriate capital improvements, operational changes, or other energy-saving measures to help stay ahead of the curve;
  • Procure and implement the selected measures;
  • Start reaping the benefits.

Depending on the type of improvements, this process could take a long time, especially as buildings deal with uncertainties and energy usage pattern fluctuations associated with post-COVID re-entry.

My advice if you want to avoid a nasty surprise in the form of a plummeting ENERGY STAR score in a few years: Start preparing now.