Carbon Lighthouse is a Guidepost for Energy Efficiency

Energy Efficiency In Buildings Is Improved By Carbon Lighthouse

Cleantechnica, June 14, 2016

Carbon Lighthouse improves building energy efficiency to save its clients money, and to combat climate change. Stanford University, Tesla Motors, and Kilroy Realty are just several of the organizations it has worked with so far. CEO and co-founder Brenden Millstein answered some questions about its approach and technology.

Did you create your own data collection and analysis to go with your sensors? It sounds like your sensor systems and data collection are much more flexible and precise than what are typically used in building management, and if that is the case, how did you create your system and strategy?

Funny story: we did not create our data and analytics system by following our business plan. We created our system out of panic. Our first customer – a private school in Oakland – had done a lot of efficiency work before we showed up. There was no low hanging fruit left. There’s wasn’t even medium hanging or high hanging fruit. The orchard had been harvested. But we’d already signed a contract promising to deliver energy savings.

So being nerdy physicists, we thought if we bought some sensors and started measuring everything maybe we’d find something in the data everyone else had missed. And we did! We saved something like 5% of the whole building’s energy use. With each new building we used more sensors. And with each additional sensor we found more energy savings. As time went by we needed to develop software just to handle the amount of data we collected.

Today, we use machine learning algorithms running across our data in the cloud, cutting up to 30% of whole building energy use just by optimizing existing equipment.

Not only can we cut 30% of energy use, our platform enables us to do it about 10x more cost-effectively than traditional efficiency firms. While we’ve worked very effectively in buildings as large as 1.2 million square feet, we’ve also worked profitably and effectively in buildings as small as 20,000 square feet. Johnsons Controls’, Siemens’, and Honeywell’s energy groups can only work profitably in buildings larger than 250,000 square feet. There are fewer than 50,000 buildings in the entire country that are larger than 250,000 square feet, but almost one million commercial and industrial buildings under 250,000 square feet.

You make buildings more energy-efficient and save the owners money by reducing energy costs. How do you do that?

We take the opportunities surfaced by our data and match them against their financial outcomes, bringing together the world of science and the world of finance. This delivers the highest value financial outcome for the customer.

After installing our platform, the system continuously crawls the data looking for tradeoffs and optimizations. This could be something like “turn this fan up, which has a penalty, but will enable us to turn two pumps down, net saving 25%.” Ten minutes later the system will make a new adjustment.

Your site mentions NOI. What is that and why does it matter?

NOI is important because it lets us resolve the landlord tenant split incentive, a hurdle that has plagued energy efficiency companies for decades.

NOI stands for “Net Operating Income.” It’s how landlords measure the profit of their buildings. In most commercial office buildings, however, cutting energy use does not increase NOI. Typically, the Landlord needs to pay for energy projects but the tenants get the benefits. Thus, landlords have no direct incentive to do energy efficiency.

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Image Credit: a-mblomma