Last week, the Design for Performance pilot studies had a six month check-up from Paul Bannister, the Australian expert who designed the NABERS Energy rating scheme for commercial offices. The pilots are testing in real UK development projects key ingredients which support the NABERS Energy Commitment Agreement, a process which helps office buildings there to achieve base building operation in line with the energy performance targeted at project initiation.

Paul had travelled from Canberra to meet each pilot project team in London, as well as supporting trade bodies and policy makers, to review progress since his last visit in March when the feasibility study was being completed. Since then, four pilot studies have got underway and three others are being developed.

Paul started each meeting by relaying that since his last visit the first two 6-star NABERS base buildings have been confirmed in Melbourne, where previously the best had been 5.5 stars. On the NABERS 1 to 6 stars scale, 6-stars is half way from 5-stars to net zero, so the uplift from 5.5 stars represents a 33% improvement in Melbourne’s best performers. And it indicates they are using three times less energy on a like-for-like basis than London’s best performing buildings (previously two times). Melbourne’s best are now quite conceivably using six times less energy than some new buildings in London (previously four times).

Paul admitted these are scary figures to be claiming - can there really be that much difference? But he pointed out that back in 2000, when NABERS started, the average building in Melbourne was 2.5 stars, similar to the London average today. The meetings then focussed on what are the key factors creating these differences, as well as the practicalities of implementing the pilot studies.

Why Australian offices perform better

The following five key factors for better base building energy performance in Australian offices were identified:

1. UK Code and EPCs ignore HVAC detail: in Australia it is common practice to undertake full simulation of HVAC systems and their controls at the design stage. This allows the control strategy to be corroborated and refined by the modelling process before it is implemented. And then the HVAC and controls are installed, commissioned and verified to be in line with the model. Furthermore, the model predicts the ideal energy performance of the as-built system and the fine tuning during early operation can target these predicted outcomes by comparing them with the actual energy used by each sub-system (boilers, chillers, fans, pumps, lifts, etc.) measured with sub-meters. There’s an expectation that the real performance will turn out to be within 10% of that anticipated from the modelling. This computer-aided-design template is the means by which much of the modern world has progressed so fast. Building construction is following this path through BIM, but the energy performance of HVAC systems, at least in the UK, has not received due attention.
2. An M&E skills gaps in the UK: this manifests in multiple ways, but can be summarised in 3 categories: a) inexperience in designing HVAC for operational energy performance (a ‘design for compliance’ culture pervades the industry); b) inability, or at least inexperience, to undertake the detailed simulation of HVAC described in point 1 above; somewhat of an irony given that the simulation software often deployed in Australia is developed and maintained in the UK; furthermore, quite a few Australian M&E designers were trained here. It might well be deduced that the underlying problem is UK clients not asking designers to do detailed simulation. And c) a shortage of suitably trained O&M engineers who can run buildings at their optimal efficiency.
3. We don’t measure and rate HVAC performance: it was striking at the meetings last week how easily those participating, many of them unaware of NABERS before the meeting, dropped into discussing technical performance using the NABERS metric (1 to 6 stars with half stars between). This dialogue would be echoed in discussions between landlords and tenants if the UK had a rating system, but without it, underperformance is invisible to both owners and occupiers. Both parties might be expected to give the issue a higher priority if cognisant of the scale of the inefficiencies we believe exist (three to six times more energy being used than the best in Australia on a like-for-like basis). Equally, policy makers might be expected to regulate to prevent such inefficiency. Indeed, our presentations to the Committee on Climate Change (CCC) and BEIS were well received, reflecting perhaps that the CCC’s latest recommendations to government published the week before recommend a new performance-based energy labelling scheme for all non-domestic buildings that would reward low-carbon buildings - it references both NABERS and the BBP Design for Performance pilotsⁱ.
4. We don’t value energy performance: the meetings involving M&E engineers repeatedly raised the point that their clients (developers) and the developers’ clients (occupiers) perceive energy efficiency as a second order issue, at best. This means efficient HVAC design is not one of the key factors that must be balanced against others, such as architecture, net to gross floor area etc., by the developers and their leasing agents. The contrast with Australia is stark, because there the building’s star rating is taken as a proxy for building quality and influences how much rent the landlord can secure. In reality, some of our meetings inferred that efficiency in the UK situation may even be a third order issue, with Code compliance being the only goal and energy efficiency measures being ripe fruit for the Value Engineering snip. As an aside, it was pointed out that Minimum Energy Efficiency Standards are influencing market decisions: several stakeholders noting that they are re-evaluating assets in terms of EPC risk and that this does have an impact on value. This demonstrates the market’s ability to associate energy performance with value, albeit the need now is for a performance based carrot to complement the compliance based stick.
5. A blurring of responsibilities for HVAC control between landlord and tenants: it is common in the UK, especially in prime London offices, for landlords to provide a central HVAC service to all the tenants in a building, but to outsource provision and fit-out of HVAC systems on tenant floors to the tenants themselves, with tenants often installing their own BMS and having their own FM team. The landlord’s managing agent for the building and their (often third-party) FM team has little or no visibility of each tenant’s system, creating the need for the central service to be provided 24/7 in case any tenant system calls for heat or coolth. This makes efficient base building operation virtually impossible. In Australia, the landlord retains control of on-floor HVAC. Tenants can still manage their own on-floor fit-out, but landlords require oversight and approval of the design from their own consultants to ensure the tenant system does not compromise the landlord’s ability to provide an efficient service (and the promised base building rating). Tenant fit-out may include HVAC servicing for hot-spots like on-floor server rooms, but this would use energy off the tenant’s meter, not the landlord’s HVAC.

Comparing approaches to landlord tenant on-floor servicing responsibilities

To overcome these challenges, the first question to ask is: why do UK landlords cede HVAC control to tenants? Clearly, one answer is that the management of on-floor HVAC is a burden landlords are pleased to pass on. It avoids the need to gain access to a tenant’s demise for maintenance, tenant FM teams get to field comfort complaints from occupants and, perhaps most significantly, some key tenants are more than willing to take charge of their own destiny. It essentially has become an accepted norm in the market. The other side of that coin is it may represent an unstable equilibrium ripe for disruption when stretched beyond breaking point by comparison with other models which deliver higher quality buildings with dramatically better energy efficiency, viz the Australian model.

Comparison with Australia shows a completely different but highly successful servicing model which:

• Caters for the same demanding multi-national tenants and financial institutions;
• Avoids duplication of effort and control ambiguities and so produces lower overall costs of occupancy (capex and opex) - the market accepts that landlords have single point responsibility for the full servicing of the building ;
• Encourages upskilling of all parties with KPIs based on measured performance (for example, managing agents in Australia – the same ones that predominate in the London market – now compete for new business over there on the basis of the base building NABERS ratings of their portfolios);
• Fosters innovation in HVAC solutions e.g. more efficient chillers, smarter controls and BMS, etc., as stakeholders compete to achieve higher star ratings;
• Piggy-backs on (mostly) pre-existing utility metering which supplies landlords and tenants through completely separated electrical distribution systems, an arrangement that lends itself more readily to separate landlord (base building) and tenant ratings.

Conclusions

The transformation of the base building energy performance of Australia’s office stock demonstrates what can be achieved by energy efficiency when all planets are in alignment: meters, controls, IEQ, building quality and financial drivers, to name a few in no particular order. The change has been one of both depth – radical performance improvement – and breadth - over 70% of NLA has now been rated, and the minimum threshold of 2,000 m² NLA set in 2010 (for the mandatory Commercial Building Disclosure on sale or let scheme) is being halved from next July. All stakeholders seem to benefit from pushing the system harder - innovation is flourishing.

In the UK, the realisation is dawning that, in a climate change-constrained business world, our regulatory system for the energy performance of non-domestic building is broken. The system approves ‘products’ that require 3 to 6 times more energy in operation on a like-for-like basis than an alternative system fully-proven in a comparable economy - a country with close cultural links and business ties to the UK, from whom it should be easy to learn. To use the well-worn car analogy, if Australia produced automobiles with identical if not more comfortable driving attributes, using 3 – 6 times less fuel per mile than European cars, would motorists here not demand the Australian model?

A specific key to Australia’s success has been the ability to simulate an HVAC system and its controls at a sufficient level of granularity to enable the system to be optimised as a design, then installed and fine-tuned to perform as predicted, energy performance included. Innovative solutions can be tested by the model and developed accordingly. Australia has shown that the aphorism frequently cited to defend the poor energy performance of new non-domestic buildings – each one is a prototype – should be strongly debunked as a 20^th Century anachronism.

A compendium of the slides presented by Paul during the week is available here. 

ⁱ Taking a long view, the PROBE studies (1995 – 2002) encouraged government to introduce mandatory post occupancy energy performance measurements for new buildings, but the revisions to Part L in 2002 chose instead to progress from ‘as designed’ to ‘as constructed’ energy performance predictions. A small step forward, but not the leap that was necessary. A once in a generation rewrite of Part L occurred in 2002-04 in order to transpose the Energy Performance of Buildings Directive (EPBD). This produced a bigger step forward with the introduction of DECs for public buildings over 1,000 m² (250 m² since 2015) with the promise they would be rolled out to all commercial buildings once proven on the public estate. At that point of time, there was little hard evidence that NABERS was having the success that is now so apparent. In Australia, the transformational impact of NABERS was sufficiently established by 2010 to enable the Federal government to legislate disclosure on sale or let. But tragically for progress in the UK, this was not quite in time to be acknowledged here where such knowledge might have prevented the last-minute withdrawal of the roll-out of DECs from the September 2011 Energy Act.