Brussels (October 13, 2010) – Johnson Controls (NYSE: JCI), the global leader in delivering products, services and solutions that increase energy efficiency in buildings, today launched the European branch of the Institute for Building Efficiency (IBE).  Operational in the United States since April 2010, the IBE is a new initiative of Johnson Controls providing information and analysis of technologies, policies and practices for efficient, high performance buildings and smart energy systems around the world. “The European branch of the IBE will conduct market analysis, engage a network of experts and work in tandem with a variety of organizations to promote building efficiency as a driver for economic growth and CO2 emission reductions. In the months ahead we will look at how energy performance contracting may help the EU to achieve its emission reductions objectives.” said IBE Director Jennifer Layke during her presentation in Brussels.

Building efficiency more important than ever for European organizations
A recent market analysis conducted by the Institute, in cooperation with the International Facility Management Organization (IFMA), queried over 750 European executives who manage energy decisions in their organizations. The analysis, contained in the Energy Efficiency Indicator (EEI), found that in Europe:
•    42% of executives are paying more attention to energy efficiency now compared to one year ago;
•    76% of respondents indicated energy efficiency is a priority in new construction or retrofit projects;
•    Over 67% of those queried expect the cost of supplying energy of their facilities will increase in the next 12 months; and
•    62% said they expect to make energy efficiency improvements to their facilities in the next 12 months.

… but underuse of energy performance contracting is holding back efficiency gains
The EEI found that only 26% of respondents plan to finance efficiency improvements through energy performance contracting – a procurement mechanism whereby comprehensive retrofits of buildings and building systems are paid for through energy savings, without necessarily requiring the use of capital budgets. In comparison, 40% of respondents plan to finance efficiency through the use of capital budgets, which limits the scope of efficiency gains that organizations can realize, especially in times of recession and budgetary constraint. Using capital budgets means organizations are likely to engage only in one-off efficiency improvements with very short returns on investment, for example lighting replacements. This ‘skimming’ of the most readily available efficiency gains may come at the expense of more comprehensive, ‘whole building’ retrofits that can be realized through energy performance contracting.

IBE to address the issue
Lack of information and awareness about energy performance contracting are widely recognized as key barriers to further market development. The IBE has already taken steps to address these barriers with two recent publications, one of which provides a comprehensive overview and analysis of the different procurement methods that can be used to carry out an energy performance contract www.institutebe.com/InstituteBE/media/Library/Resources/Existing%20Building%20Retrofits/Issue-Brief---Energy-Performance-Contracting-in-the-EU---Part-2.pdf
To gain critical insights on the barriers to wider market development, the IBE will conduct over the next two months a pan European survey designed to identify the most common barriers to energy performance contracting in the public sector.
“A greater awareness of the potential and use of energy performance contracting can be a catalyst for meeting CO2 reduction commitments and for generating smart energy solutions in the European Union. However, for energy performance contracting to reach its full potential, it is vital that we assemble the most refined knowledge on the barriers that block its use and development. This is a key role for the IBE in Europe”, said Agostino Renna, Vice President and General Manager, Energy Solutions, South & Central Europe.