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Title: Energy Efficiency, Building Productivity and the Commercial Buildings Market

The energy-efficiency gap literature suggests that building buyers are often short-sighted in their failure to apply life-cycle costing principles to energy efficient building technologies, with the result that under investment in these advanced technology occurs. This study examines the reasons this behavior may occur, by analyzing the pressures that market forces place on purchasers of buildings. Our basic conclusion is that the fundamental manner in which the buildings sector does business creates pressures to reduce initial capital outlays and to hedge against a variety of risks, including the ability of building owners to capture benefits from energy efficiency. Starting from the position that building buyers' willingness to pay drives choices over building attributes, we examine basic market principles, the structure of the buildings market, including the role of lenders, and policies that promote penetration of energy efficient technologies. We conclude that greater attention to buyers, and to the incentives and constraints they face, would promote a better understanding of building investment choices and contribute to better policies to promote the penetration of these technologies into markets.
Authors:
Publication Date:
OSTI Identifier:
814265
Report Number(s):
ORNL/TM-2002/107
TRN: US200317%%107
DOE Contract Number:
AC05-00OR22725
Resource Type:
Technical Report
Resource Relation:
Other Information: PBD: 16 May 2002
Research Org:
ORNL Oak Ridge National Laboratory (US)
Sponsoring Org:
US Department of Energy (US)
Country of Publication:
United States
Language:
English
Subject:
32 ENERGY CONSERVATION, CONSUMPTION, AND UTILIZATION; BUSINESS; CAPITAL; COMMERCIAL BUILDINGS; ENERGY EFFICIENCY; LIFE CYCLE; MARKET; MARKETERS; PRODUCTIVITY