What is Energy Forecasting?
Definition
Energy forecasting for commercial real estate is the process of applying statistics to make predictions about consumption levels and corresponding utility costs in both the short term and long term. Energy forecasting models take into account historical trends, weather inputs, tariff structures and occupancy schedules to make predictions.
Why it Matters
With granular energy tracking sensors, energy forecasting can go far beyond predicting monthly utility bills.
Equipment-level energy consumption forecasts can be used by building operators to implement operational strategies to counteract factors that lead to increased energy spend. For office and multifamily portfolios, energy forecasts can make help in plans to optimize the operations of chillers, boilers and other critical equipment systems.
In addition to operations, asset managers can allocate funds to pay for utilities in a much more dynamic fashion. In many portfolios, utility bills are paid for without a second thought, taking from a large reserve to cover costs. With accurate forecasting, this reserve fund can be decreased and the same money can be used for more productive purposes.
