Our Thoughts
Tue, 18/06/2024 - 12:00
· 2 min read

Managing Energy in a Volatile World

The recent volatility seen in prices has brought the not-so-sexy practice of energy procurement and management into sharp focus.

Suppliers have become more assertive in collecting overdue payments, increasing the threat of disconnections, landlords are getting more involved in negotiating agreements, and both landlords and occupiers are integrating the way they manage energy into their wider ESG objectives.

 

Collaboration is Key

Successful energy management i.e. a reduction in the energy consumption of an asset, requires effort from both landlords and occupiers. We facilitate this collaboration through Green Building Committees, an annual sit-down of the landlord and occupier of a building to develop an energy reduction plan, monitor progress and discuss further opportunities. These annual meetings are law in France, and we’ve seen how working together in this way not only reduces energy consumption and costs, it also builds a positive relationship that helps in other areas too.

Get it Right From the Start – Green Leases

We’re seeing the imposition of green leases or green lease clauses in tenancies, but these are often vague and contain the phrase ‘where possible’, meaning there is little impetus for either side to take action.

A green lease clause should be clear about the energy use intensity aim of the asset, the landlord and tenant’s responsibilities in that, the data that will need to be shared and the format in which it should be done.

It’s the Small Things

Keeping billing details correct is important, particularly during changeovers and void periods. Estimated readings need adjusting. By keeping on top of the basic aspects of energy management, your credit rating remains in good shape and is attractive to energy suppliers, helping to secure the lowest prices possible.

Metering

It’s not uncommon for property owners to lack clarity as to how many meters are in a given building or portfolio. We recommend conducting a meter verification survey to get a handle on how many meters are in the building and what areas they are serving. At that point, decisions can be made as to whether the current metering system works, or whether a switch to automating meter readings makes sense. A more proactive approach to gathering data can allow much better energy optimisation.

Read the next article, Maximising Social Value Requires a Tailored Approach or discover more from our ESG in Perspective magazine.

Managing Energy in a Volatile World