Most buildings that will be in existence in 2030 are already here today. So an average 22 percent savings across around 75 billion square feet in the United States ends up being a lot of cost, energy and emissions avoidance. No doubt the biggest opportunity is in existing buildings. But what about the new buildings we are designing and putting into service? Why wait until the operations phase of a building to begin? Why not tie the design and construction teams to building performance? The Rocky Mountain Institute (RMI) released a guide in 2004 detailing a possible model to this approach. According to RMI:

• Each energy performance contract must be tailored to the conditions of a specific project, but all performance contracts should have four basic elements:
• A clearly stated target or performance goal.
• A method to evaluate performance during the design process.
• A protocol for measuring performance after the building is constructed, commissioned and occupied.
• A/E compensation (or design/build fee) that is partly contingent upon meeting the performance goal.

So what about the potential reward or associated risk for failure to meet performance goals? The report goes on to say that “the incentive can be viewed as the net present value of the energy savings over a fixed time period, usually in the neighborhood of five years. Similarly, the penalty can be viewed as the net present value of the increased energy cost over that same time period.”

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