Gathering Energy Data Across Property Portfolios

Expectations from Investors, shareholders and other stakeholders continue to rise when it comes to reporting on the environmental performance of real estate portfolios. 

A key element of environmental performance of real estate portfolios is the amount of energy being consumed by occupiers. Energy Performance Certificates (EPC) only provide a theoretical estimate of energy efficiency of buildings and do not provide any insight into how much energy is actually being consumed. Asset owners need to know the level of actual energy intensity across their portfolios. Not only is this base data the starting point for identifying action plans, but having this data is a key element of demonstrating commitment to stakeholders. 

The challenge facing the sector has been gathering this data in the context of tenants selecting their own suppliers, being the bill payers (collectively for the bulk of the space across portfolios) and not necessarily being open to actively sharing this data with their landlord. 

Gathering this essential data can be done in more than one way. Often asset owners start their journey by requesting data from tenants. This methodology is not only very time consuming but inevitably falls a long way short of meaningful portfolio coverage. Another option is to install shadow meters or sensors at every meter point. These sensors work by detecting pulses or flow rates in the cables / pipes. However, this methodology presents the logistical challenge of arranging consented access with every tenant and carrying out the hardware installations. There is a cost for the hardware albeit that these costs have fallen. There is also a less obvious drawback in this methodology in that whilst the sensors will gather granular data, the identity of the supplier will be unknown i.e. this will not identify supply from low carbon suppliers (and hence lead to over-stating carbon emissions). 

The challenges and shortcomings of these methodologies has led major asset owners to turn to providers that can harvest this data from central data sources. These providers can harvest energy data at portfolio level without any tenant consent. This data can then be disaggregated within the UK's legitimate interest rules to a reasonably granular level. Note that these rules vary across EU countries. This methodology provides comprehensive data across portfolios on a supplier-specific basis and enables asset owners to be able to achieve better sustainability scores (e.g. GRESB, PCAF) and to be able to provide more comprehensive data-backed reporting within environmental reporting frameworks. 

Demand has spread from commercial investment managers, REITs and property companies to the residential sector - initially the large private rented sector operators and for-profit affordable housing funds - but interest in growing in other segments including banks and facilities managers.

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