The U.S. Department of Energy recently announced that its $61 million grants are going toward 10 smart buildings across the country as part of a pilot program to cut energy use and increase energy efficiency during peak times of day.
Over 7,000 workplaces, homes and other buildings will be converted into grid-interactive efficient buildings (GEBs) with smart sensors and controls that connect and communicate with an electrical grid. These developments are part of the Connected Communities program the DOE announced on October 13.
The initiative aims to reduce the building sector’s carbon emissions. It ties into the government’s goal of having a zero-carbon economy by 2050. This is one of its key steps.
Roughly $6.65 million of that DOE grant is being awarded to Edo, an energy startup that specializes in helping get buildings onto the energy-saving grid. In a reluctant, sometimes old fashioned (sometimes even retrograde) brick and mortar world, it’s an incredible feat in the making. This particular project will be implemented in the South Landing development and Spokane EcoDistrict in Spokane, WA with zero-carbon and zero-energy building operations.
In addition to the $6.65 million DOE grant, Avista and the other project partners will invest another $4.9 million in matching funds, for a total project cost of $11.55 million.
“It’s to balance the needs of the building, its occupants and serving the grid,” said Hendrik Van Hemert, Managing Director of Edo. “It’s about resilience and reliability. We’re trying to show to the world eventually how to develop buildings that are net zero energy, zero carbon.”
In the greater picture, this is part of the International Energy Agency’s goal of building a global energy sector and getting the world down to zero-carbon emissions by 2050. It’s an ambitious energy roadmap.
In a statement, IEA Executive Director Fatih Birol called it a “pathway to a brighter future” with “a historic surge in clean energy investment that creates millions of new jobs and lifts global economic growth.”
Van Hemert thinks the 2050 goal is possible. “It’s going to take a whole lot of companies working together to get there, but it’s possible,” he said.
But on a micro-level, getting one building onto the grid is not a simple switch. Being so early in the game means many building managers don’t fully understand what it means to get on the grid, or the process is not as simple as it sounds.
“A net zero building could mean you have a ton of solar rooftops, which is great, it might balance out your energy consumption, but it might not be good for neighboring buildings or the grid at large,” Van Hemert explained. “What South Landing is trying to do is show they’re flexible assets, and able to support grid operations in their decarbonization efforts. It’s meant to be groundbreaking, to show how grid buildings are interactive.”
The DOE grant will allow Edo and its network of buildings — and their developers and operators — to expand to other buildings in their respective communities.
“We think about how we charge our thermal storage tank, dispatch different building systems, and coordinate all that,” he said.
With the DOE grant, Edo’s Connected Communities project in Spokane will become a model that will meet regional and local grid needs through a mix of GEBs, energy efficiency programs and distributed energy resources (DERs), like solar photovoltaics (PV) and battery storage.
The program will also focus on how much energy is used, and how to better utilize the grid, as well as make energy more affordable. The lessons learned here are an example that will be published in a playbook to help other communities with their own projects and energy design. There will also be programs for residents and Avista customers to better understand the process.
“The goal is to demonstrate that 200 buildings can perform services back to the grid,” Van Hemert said. “The project we funded was to add more renewables, more energy storage in a handful of neighborhoods, which allows us to demonstrate the benefits of the grid, not just the building.”
The DOE estimates that over the next 20 years, the country’s adoption of GEBs could save the country up to $200 billion in electricity costs. In reducing electricity consumption, GEBs can also cut greenhouse gas emissions by 80 million metric tons a year by 2030. That’s the equivalent of over 200 million miles driven by the average car.
“One single building doing all the right things, doesn’t make that much of an impact on the grid,” he said. “You need to find ways to scale this across more buildings, so that orchestration can be placed at a higher level. That’s what this funding will allow us to do.”
Edo was co-founded in 2019 by two companies: McKinstry, a national construction and energy services firm, and Avista, an innovation leader in energy production, transmission, and distribution of energy. Edo is helping get the real estate world to adapt to grid-interactive efficient buildings (GEBs). The tech smarts of McKinstry, combined with innovation leader Avista, is a double-edged sword to help building owners, construction teams and developers get onto the GEBs with real solutions and money saving tactics.
They work with developers, building owners, architects, engineers and construction teams, educating them on GEBs and providing the technical tools they need to support energy efficient buildings. They also help digitally manage utilities, data analytics, train teams on energy efficiency and offer operations support.
The biggest challenge with GEBs is scale.
“In order to maximize the value to all the stakeholders, you have to have scale,” Van Hemert said. “You must have enough buildings working together. Individual buildings becoming more efficient is wonderful, but until we aggregate that, it’s not having that interactivity optimization impact.”
But if it’s affordable and saving building owners money, why aren’t more developers signing on?
“The biggest risk is uncertainty in new markets,” he explained. “Historically, developers build buildings that they’re comfortable with and understand how they work.”
Naturally, there’s a bit of risk aversion there. When Edo sometimes talks about GEBs to property owners, there’s a lot of questions around how the building is performing services for the grid. “In a lot of places, there’s no marketplace for that yet,” he noted.
It can be hard for a developer to take that risk, when it seems more like an energy consumption than conservation.
“Part of our business model is helping take that risk on behalf of developers,” Van Hemert said. “Helping them take some of that scope out of their project, at Edo we step in and say here’s some of this technology or operate it.”
With the DOE’s recent report citing GEBs widespread energy system costs, it will take regulatory change and time for markets to develop.
It’s sort of like getting people to drive electric cars. There’s a change of mentality that has to shift for that to take place.
“Every developer has a plan of what they want to do with their building,” he said. “We’re trying to demonstrate that energy costs might be relatively predictable. The service you get from utility has been consistent for 120 years, so we have to demonstrate why that might change. Greenhouse gas emissions, different things happening around distributed energy systems, battery systems, all these things are changing that landscape. We inform, educate and share.”
With Edo, their tools can help save a building between 10% and 15% of their utility expenses, “and that’s helping optimize from the bill structure that exists,” Van Hemert said.
“Where regulatory change is happening faster, like in New York, California and Hawaii, which have stronger, more corrective greenhouse gas targets, utility bills are rapidly changing. You might see 50% change over the lifetime of a building,” he added.
The benefits will be different across markets. But for developers there could be a tremendous amount of savings a building can achieve, he claimed.
“We wake up every day thinking about what needs to be done to unlock the promise of GEBs,” Van Hemert said. “We’re reimagining the way buildings can participate in the grid to drive carbon out of the built environment and the grid, in a way that’s equitable for everyone.”