Photo "Four Towers" courtesy of the Octavian Rosca

Normalized Metered Energy Consumption is the new approach to calculating baselines in energy efficiency programs, powering payments for actual savings.

There’s broad consensus that sustainable buildings are more profitable, attract higher-priced leases, and generate higher net operating income. A new industry trend might add another leg of savings, this one with actual income benefits for building owners. Ready for a new buzzword?

What is NMEC?

“NMEC,” or Normalized Metered Energy Consumption (en-mec) is the hottest trend to come to the dull world of energy efficiency programs. Propelled forward in California by a trinity of legislative directives, NMEC is changing the energy efficiency game in an intriguing way.

The old way of energy efficiency is familiar to many Gridium buildings. Start a project only to get tossed random, nonsensical spreadsheets by your vendor, utility, and outside consultants. A few months later, some grey hairs and your incentive check finally arrives. Rinse and repeat.

The new NMEC approach leverages your smart meter data and holds your project accountable for actual performance. Historical data and its correlation to weather serves as a comparison baseline. Once the project is complete, readings are compared to the baseline and savings computed. Sound familiar? Yes, Gridium can be–and is being–used for NMEC programs.

NMEC Snapmeter Savings

Weather-normalized baseline comparison for an analysis period of January 2018 compared to a baseline period of January 2017.

NMEC pays for actual savings

The new NMEC approach solves a lot of the frustrations of energy energy efficiency programs for commercial customers. Instead of a flat kilowatt incentive for a new chiller, your new project will get incentives based on how much energy it actually saves. Instead of obtuse rules about whether or not a new drive or some controls programming qualify for incentives, spend what you want and get incentives based on how everything actually works together. You make the music, the savings you achieve give you the revenues to pay back your investment.

Uncertain incentives may sound scary, but energy efficiency investments have always been nail-biting experiences, especially for complex commercial projects. The exciting part of NMEC is indeed the opportunity to get performance feedback and course correct on actual savings rather than deal with the capriciousness of utilities and a maze of spreadsheets.

In short, think of NMEC as a speedometer on your energy savings investments, instrumenting an old, one-time dumb process with real-time performance feedback.

When does NMEC arrive?

There are already small programs launching in California, New York and New Jersey. As usual, the big action is in California; as the energy efficiency markets enter a new program cycle later this year, proponents are lining up to use these new methods.

If you’re asking yourself why this matters, remember that energy is a zero sum game. Energy leaders are subsidized by energy laggards. NMEC is just the latest twist in this game. The building down the street that doesn’t take energy seriously could soon be paying your building for its finely-tuned operations!

About Tom Arnold

Tom Arnold is co-founder and CEO of Gridium. Prior to Gridium, Tom Arnold was the Vice President of Energy Efficiency at EnerNOC, and cofounder at TerraPass. Tom has an MBA from the Wharton School of Business at the University of Pennsylvania and a BA in Economics from Dartmouth College. When he isn't thinking about the future of buildings, he enjoys riding his bike and chasing after his two daughters.

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