Verified! How Performance-Based Procurement Can Boost New Construction Program Savings and Empower Building Owners

Most utility new construction programs depend on modeled projections and deemed savings based on individual technologies. The industry has established ways to evaluate these programs based on the promise - not the actual performance - of these buildings post- occupancy. Deeper savings from a more integrated design with continuous performance monitoring are left on the table, locking out the higher performance for the lifetime of the building. This paper will demonstrate how performance-based procurement can empower utility incentive offerings to drive deep energy savings and reduce administrative costs. The key is to incentivize a change in the building owner's procurement process and reward actual building energy performance rather than incentivizing specific measures. The paper looks at strategies to transition new construction programs from technology-based verification to actual measurement of performance outcomes. Accelerate Performance, a U.S. Department of Energy (DOE) funded initiative, changes the building procurement approach, which spurs innovation and motivates the design and contracting industry to achieve deep energy savings in new construction - in the case of DOE's National Renewable Energy Laboratory Research Support Facility (NREL) in Golden, CO, 50% without increasing initial costs. Utility programs in three states, Illinois, Minnesota, and Connecticut, are actively piloting the approach with leading-edge owners. The paper will share savings results and lessons learned from the three different utility pilot programs. The paper provides practical guidance for utility program managers about how to apply the Accelerate Performance approach to supplement their current new construction program offerings.