Fortune 100 industrial client realizes $65.3 million in energy cost savings
Longtime partnership with JLL delivers millions in annual energy cost savings and a 3.5% reduction in carbon footprint
$65.3 million in energy cost savings
3.5% carbon footprint reduction
25M s.f. of office, manufacturing and engineering space
In 2007, the client – a Fortune 100 global software-industrial company – hired JLL to deliver a broad range of real estate services, spanning facilities, project, portfolio and energy management across their 25M square feet portfolio of manufacturing, engineering, and office spaces across the US, Canada, and Mexico.
This case study features an integrated energy and sustainability solution, which brings together JLL offerings from the following product families:
- Building Assessments & Optimizations
- Sustainable Operations
It’s also important to note that the client’s energy and sustainability solution is delivered as part of an integrated real estate services delivery model, which brings together JLL services across facilities, project and portfolio management into a centralized organizational structure.
Since the beginning of their relationship with JLL in 2007, the client has been focused on cost optimization across all areas of their operations, including energy and sustainability. The client’s real estate leader was – and continues to be - under pressure to deliver multi-million-dollar energy cost savings each year and knew that their onsite JLL teams needed to be incentivized to deliver.
The client also knew that they could not rely solely on traditional energy conservation measures to deliver savings over the long-term, especially given the age and stability of their portfolio; they would need to innovate to sustain such aggressive energy savings year-over-year. They needed early access to industry-leading technologies, along with peace-of-mind that these solutions had been properly vetted and could be implemented with minimal risk.
Beginning in 2015, the client’s CFO was also under increased pressure from their corporate sustainability leader to allocate capital for energy and sustainability initiatives. This was a win-win decision for both parties: the CFO saw an attractive opportunity to invest capital in projects that would reduce operating costs (and ultimately pay for themselves) whereas the sustainability leader saw these projects as an opportunity to reduce the organization’s carbon footprint.
As the client accelerated their investments in energy efficiency projects, a new challenge emerged: they learned that traditional mechanical, electrical or general contractors did not typically have the specialized expertise needed to budget for and execute energy projects. They knew their project management teams needed extra support from energy and sustainability subject matter experts, especially as their teams juggled a mounting load of increasingly complex energy projects.
In 2007, JLL launched the client’s Sustainable Operations program, which was designed to help the client achieve their cost optimization goals. Through this program, we help the client to:
- Manage utility bill data across their entire US portfolio (186 sites), using JLL’s proprietary portfolio environmental and energy reporting technology platform
- Supply data for the environmental section of the client’s annual Corporate Citizenship Report
- Conduct energy audits to identify potential no-cost, low-cost and capital energy conservation measures
- Execute select energy conservation measures, in partnership with the JLL facilities and project management teams
- Ensure that the JLL energy and sustainability team’s performance incentives align with their cost optimization goals, by adopting a gainshare contract structure
- Align their JLL facilities management team’s performance incentives with their energy goals, by incorporating specific energy targets into each JLL staff member’s performance goals
- Evaluate and implement innovative energy-saving technologies, like software-powered motors from Turntide, a JLL Spark investment company
Beginning in 2015, we supplemented the client’s existing Sustainable Operations program with an Energy Project Management Office (PMO) solution. With this additional service, we help the client to:
- Ensure that energy capital projects are appropriately and efficiently scoped, budgeted for, and executed by contractors with the right level of energy and sustainability expertise
- Facilitate a smooth handoff between JLL’s facilities managers – who are responsible for identifying energy projects – and the JLL project managers who are responsible for executing select energy projects
- Troubleshoot issues with energy equipment installations during the buildout phase (and before they become problematic)
Since the client’s Sustainable Operations program launched in 2007, we’ve helped the client to:
- Achieve upwards of $65.3 million in energy cost savings (averaging $4.3M in savings each year), exceeding the client’s target energy and sustainability savings targets by 1.5x each year on average.
- Execute 2,985 no-cost and low-cost energy conservation measures, driving $32.6M in savings.
- Execute 959 energy capital projects driving $32.7M in savings and managing a $10 million annual capital budget for energy and sustainability projects since 2015. On average, these projects pay for themselves in less than 5 years.
- Reduce their overall carbon footprint by 3.5% (232,674 tonnes) over the program’s lifetime – the equivalent of taking more than 180,000 of cars off the road for a year.
- Conduct 100+ energy audits (across an average 2.5M square feet each year) and identify 3,775 no-cost and low-cost, and 2,108 capital energy conservation measures – totaling $98.7M in savings opportunities identified.