56 min read

🎧 #126: Decarbonization from the trenches

“There is another use case for smart building systems and for BAS, and it is critical input data for designing low-carbon systems for your building that if you don't have that data, you are not going to design your systems properly.


They will probably be oversized and a lot more expensive than they need to be compared to as if you had good data to design on."


—Brad White

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Episode 126 is a conversation with Brad White, President of SES Consulting, and Leo Glaser, Manager of Environmental Sustainability at Concert Properties in Canada.

Summary

The theme here is decarbonization from the trenches. Most property owners don’t have a real, detailed plan for decarbonizing their portfolios, despite widespread corporate commitments to do so.

So we talk about the steps in building a roadmap, how Concert Properties built theirs, how they make the business case, the role of smart building technology, and Brad even gets on his soapbox to send two messages out that I think a lot of us need to hear right now.

One quick announcement before we dive in: if you like this topic, this month’s Nexus Pro Member gathering will feature BXP’s Ben Myers and will highlight their journey and give everyone a chance to fire questions at a man responsible for decarbonizing 50 million square feet. Join Nexus Pro now to get the invite.

Without further ado, please enjoy the Nexus podcast with Brad White and Leo Glaser.


🔍 A message from our sponsor, Clockworks Analytics 🔎

The Building Analytics Comparison Guide is used by industry-leading facility teams and service provider organizations to make the jump from building automation system (BAS) alarms to prioritized and proactive maintenance using Fault Detection and Diagnostics (FDD) software. There are actually two kinds of fault detection and diagnostics (FDD) software: those that stop at the first “D” (Detection) and those that go all the way to Diagnostics.

This guide tells the story of the second "D" and why it's so important. Get the guide here.


  1. QuadReal (3:29)
  2. Concert (3:47)
  3. SES Consulting (4:57)
  4. Audette (16:44)
  5. 🎧 #085: A carbon reduction plan for every building on the planet (19:09)
  6. The Lens: The Energy Spreadsheet Must Die (19:05)
  7. Revisionist History Podcast (1:10:30)

You can find Brad and Leo on LinkedIn.

Enjoy!

Highlights

  • The shift from energy management to decarbonization (7:05)
  • Decarbonization roadmaps (14:36)
  • The role of carbon accounting (33:38)
  • Types of technologies that are vital (38:40)
  • The role of BAS and analytics (47:15)
  • Electrification - when does it make sense and how technology can help (50:48)
  • Tips for others on this journey (1:05:54)
  • Carveouts (1:09:55)

🧠 A message from our sponsor, BrainBox AI 🧠

Transform your existing HVAC system into a predictive brain that learns precisely how to use less energy to optimize comfort in all building zones, at all times. With BrainBox AI you can reduce your carbon footprint, lower energy bills, and increase equipment life.

Learn more by checking out this success story: Westcliff shopping centre made more efficient with AI for HVAC.


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Music credit: Dream Big by Audiobinger—licensed under an Attribution-NonCommercial-ShareAlike License.

Full transcript

Note: transcript was created using an imperfect machine learning tool and lightly edited by a human (so you can get the gist). Please forgive errors!

[00:00:33] James Dice: I want to remind all of you about the building analytics comparison guide, which was a collaboration between us at nexus labs and the team at clockworks analytics. It's used by industry leading facilities, teams, and service provider organizations to make the jump from building automation system alarms, to prioritize and proactive maintenance using fall detection and diagnostic software.

In the guide, we show how there are actually two kinds of fault detection, diagnostic software, those that [00:01:00] start with the first D detection and those that go all the way to diagnostics. And this guy tells the story of the second D and why it's so important. So get the guide at the link in the show notes.

[00:01:10] James Dice: This episode is a conversation with Brett white president of SCS consulting and Leo Glazer manager of environmental sustainability at concert properties in Canada. The theme here is de-carbonization from the trenches. Most port property owners don't have a real detailed plan for decarbonizing their portfolios, despite widespread corporate commitments to do just that. So we talk about the steps in building a roadmap, how concert properties built theirs, how they make the business case, the role of smart building technology and Brad even gets on a soap box to send two messages out that I think a lot of us need to hear right

These are lessons from the trenches. One quick announcement before we dive in. If you like this topic, this month, nexus pro member gathering we'll feature, BXP Ben Meyers and we'll highlight their journey and give [00:02:00] everyone a chance to fire questions. At the man responsible for decarbonizing 50 million square feet.

So join nexus pro now to get the invite. And without further ado, please enjoy the next podcast with Brad white and the O Glazer.

[00:02:14] James Dice: Hello, Leo and Brad, welcome to the Nexus Podcast. Great to have you guys on. Leo, let's start with you. Can you, uh, introduce yourself please?

[00:02:22] Leo Glaser: Yeah, absolutely. Hey James, thanks for having me today. My name is Leo Glazer. I'm the miniature for environmental sustainability at concert properties. I've been with the organization for a bit over two years. So my field is pretty much leading the ESG department at concert and that includes mostly everything that's environmental related to deco organization, implementing high efficiency and deco conversation projects in our buildings, but also the social and the government side after the organization.

[00:02:49] James Dice: cool. Let's, before we go over to Brad, uh, can you give us a little background, like what were you doing before concert? Uh, what's your sort of career educational [00:03:00] background?

[00:03:00] Leo Glaser: Yeah, totally. Um, so I did my masters at UBC in clean Energy Engineering and resource manage. And while, uh, . Yeah, , yeah. I kind of created a bit my own field, so combination of both. Um, and while I was still a student at ubc, I started working for Energy and Water Services and yeah, very similar capacity as the energy analyst, working on energy conservation projects, uh, most of the time and analyzing data of campus buildings.

And then I moved to Ri property, property group in uh, 2017 also as an energy analyst and worked there for three and a half years. So I've been working in the commercial real estate work since, uh, early 2017. So it's been quite a number of years now.

[00:03:43] James Dice: Got it. Got it. And can you give people background on concert? What type, what types of buildings? How many of them, where are they?

[00:03:51] Leo Glaser: Yeah, totally. So concert only has a Canadian portfolio, but it spans well across Canada, but mainly in [00:04:00] Vancouver and in. So we are actually more known for being a real estate developer. Um, pretty much everyone in Vancouver knows concert properties for the quality of the condos. We built, um, pretty from, from, you know, like market based condos to very high end.

And, um, so the properties I take care of, that's a total, I think of 135. 137 is a mix of office, residential and industrial portfolio. So 50 51 buildings, we count as our scope two and one and two emissions. That's a mix of office in residential buildings. And the rest would be in, in scope three, which is, um, industrial sites.

[00:04:39] James Dice: Got it. Got it. Okay. Well, I'm excited to dig into all of that. Brad, can you jump in? What's, Can you introduce yourself and give a little background on, on your firm?

[00:04:49] Brad White: Sure James. I, I'd be happy to. Um, so I'm, uh, Brad White. I'm president of SES Consulting. Um, we are a firm, uh, we're based in Vancouver, uh, [00:05:00] Canada. We've got offices kind of throughout bc uh, and I guess I, I. Up until the last couple of years, it would've said we're an energy efficiency engineering firm. Um, but increasingly it's sort of energy, energy and carbon, uh, consulting.

So we're about 20 people. Our focus is almost exclusively on the existing building market. So everything from energy studies, um, through to design, implementation, implementation, verification of energy efficiency and, and decarbonization projects. Um, I'm, my background is as a mechanical engineer, most of our staff as mechanical engineers.

Um, but we also have, uh, the softer side of, of efficiency and sustainability as well where we do teaching. Um, Behavior change, things like that. Um, and so I've been doing this about, I guess about 15 years now. Um, and, but really in the last two or three years, uh, [00:06:00] increasingly the, the conversation is less about, you know, how much money can we save and how much energy can we save to Everyone wants to talk about carbon, uh, and decarbonization, which is, um, really aligned with, with our mission as a company.

We're a certified B corporation. Everyone we hire, we've always kind of been climate nerds. We, we, you know, we care about the environment and sustainability. So the shift has been really, really well aligned for us.

[00:06:22] James Dice: Yeah, and I think all three of us then kind of started on the energy efficiency train and, and then decarbonization happened and it's like, well, finally, someone cares about this. We're just calling it a different name. But we've been, you know, it's not exactly the same and will pack that. But, uh, uh, that, that was, it was a relief for me as like kind of watching this unfold over the last couple years.

And it's like, oh, maybe the long sales cycle, the long, you know, internal approval cycles, maybe those are gonna start to get shorter. Shorter nowadays. Um, well, cool. Let's, let's jump in. Um, I, I think of what I, what I [00:07:00] wanna start with is, is the concept of decarbonization in general. Before we get into like roadmaps, maybe Leo, if you could start by just saying, from, from your organiz. What does that shift mean to concert and going from energy efficiency, energy management to decarbonization? What is that shift?

[00:07:23] Leo Glaser: I would say it really depends a bit on the region. In BC we are fortunate to have a 95, 90 6%, uh, clean grit. Uh, most the feller electricity comes from, from higher energy. And so it's, it's pretty easy to, you know, swap out an old gas fire boiler for an electric heat pump because we, well, everything we replace with an electrical source that is pretty much carbon neutral, right?

Or pretty close to carbon neutral. Uh, if we look into different part of portfolio in Alberta, we have to be a bit. Uh, inventive in, in what we do. So it's more efficiency [00:08:00] driven in, in other regions than it is here in bc. I always compare it to, you know, we, we could pretty much just go into our buildings and throw out old, old gasified equipment and sell baseball heaters if they're electric.

I mean, the efficiency is pretty low, but , you pretty much decarbonize the entire building, right?

[00:08:16] James Dice: Mm-hmm.

[00:08:17] Leo Glaser: yeah, I would say it depends. Um, I mean, what we had to do in order to focus more on the determination side, uh, was really to, uh, increase the budgets for the type of projects, right? Because it's, it's just more expensive.

It's a fact that if you install a heat pump, it costs more than a gas fire butter. So there was a bit a way in, in educating the organization and, and, you know, making, making a change to just look into the numbers, also look into what, what does it do in the next 10, 15 years, uh, regarding the, the carbon footprint of the buildings.

[00:08:50] James Dice: Totally. Brad, what has it, what has it meant? What has that transition meant for you guys as this consulting firm working with a bunch of different type of clients? What [00:09:00] has that, what has that meant for you?

[00:09:02] Brad White: Uh, I mean, as you said, in one way, one way it's been kind of a relief cuz it's, it's the projects we've always wanted to recommend, but, you know, historically it was so business case driven that Yeah, the clients, you have a lot of clients, you have two, three year paybacks is what they wanted. Um, you know, maybe we had some progressive clients that would take like up to a 10 year payback.

Um, but with the shift to your carbonization now it almost decouples. From, from the business case, because I mean, we run into cases all the time where like there's no payback. Like your operation costs are gonna be higher. Um, you're, you're, the thing you're getting is, is that carbon savings. Um, and so that, that's really liberating a way cuz you just, you end up having a completely different conversation now.

Uh, and then really you're just. The best path to low carbon, not necessarily one that [00:10:00] meets a certain business case criteria or, you know, certain payback or anything like that. I mean, the financial metrics are still important, but the lens, like, funny, I'm actually starting to teach a course on this. Um, but like we start looking at totally different metrics on, um, either looking at carbon pricing.

I mean, we have a carbon tax or carbon price in, in BC and, and throughout Canada. One that's set to escalate quite significantly. Well, you know, okay, let's factor that in. Uh, we work with organizations that have established internal carbon prices. That's another factor. Or we can just look at, you know, on sort of a life cycle cost per ton.

There's all sorts of different interesting ways you can look at these projects to get to the best, The best one. But it, yeah, it's, it's, it's just a very different conversation and then also trying to get at sort of for each owner, like what is their trigger, Like what's driving them to look at this? Is it corporate ESG target?[00:11:00]

Is it the need for cooling? I mean, this is a conversation we've been having, which kind of links the climate change. Adaptation to the climate change mitigation conversation. But, um, you know, two years ago, two summers ago, we had an, an extreme weather event here where we had temperatures above, you know, 40 degrees Celsius.

So it's over, well over a hundred degrees. Um, fair night like that, that's not something we've ever experienced here before. And we have a lot of buildings that don't have mechanical cooling. I mean, I'm sure Leo will tell you about some of his residential properties historically no cooling. Um, and so now we're having that conversation.

I mean, I've had more conversations about adding cooling in the last year than I had in the previous 15 years. I was, I was in this business. And of course, once we're talking about adding cooling, now we're talking about a small incremental cost to make that chiller an air source heat pump instead of, you know, just straight cooling.

So it, it. Interesting how it links these things together. But you have to understand where your clients are coming from and what, because it's very [00:12:00] easy to get budgets approved to add cooling. If, if you've got, you know, tenants who, you know, their, their, their suites are, you know, not habitable because it's so hot, which is the situation we're in, or workplaces that aren't, um, you know, they're outside of safe working limits.

Um, then all of a sudden the money, the money to uh, you know, add cooling to the building is just there. Like, you don't have to sort of justify it the same way we've always had to justify efficiency projects or even standalone decarbonization projects. So, um, yeah, really interesting to work with organizations and kind of figuring out, you know, where they're at and, and what their pain points are that we can leverage to, to make these, these deep carbon reductions.

[00:12:40] James Dice: and, and Leah, what is the trigger? I like that framing, Brad. Thank you. What is the trigger for you?

[00:12:45] Leo Glaser: Hmm. It's, it's a bit of everything I would say. I mean, we have strong corporate carbon reduction goals in place, and, you know, we, we know that come to a point where all the long lowing fruits are, are pretty [00:13:00] much completed, right? We have changed all our lighting to l e d, we're at the end of these type of projects.

So we have to look into something that really changes the carbon footprint in our buildings. And that to us, can't be realized without switching, switching fuel. So, um, I would say yes, it's, it's definitely a corporate goal. But on the other side, like, like Brad mentioned, I mean, uh, air conditioning will become more and more, uh, relevant than our.

Uh, we, we, we've had now a number of warmer numbers than we had ever experienced in Vancouver before. And, um, I, I have a great example actually, cuz we piloted two heat pumps in a residential building at a small air, so heat pump unit. And we, we measure the energy usage in those suites, but also the temperature.

So during the heat wave when we had, uh, 42 degrees Celsius, uh, way over a hundred Fahrenheit right, we noticed that we measured in the suites with the airo heat pump, that the temperature was between [00:14:00] 30 and 32. And in the units without the, the air pump we went up to 40 and 40, 45 even, right? Cause they were self-facing.

So it was a significant, uh, temperature difference cuz we weren't quite sure if the, the small heat pumps can handle the heat load in, in, in, uh, these extreme temperatures. But it, it did. And you know, the tenants were happy to have them so, I, I can see this becoming even, even mandatory in the future, which will also make, um, breadths and my, my job easier to sells to the executive teams, right?

Who will sign off on a project if we, if we have to install our conditioning in the future.

[00:14:36] James Dice: Got it. And, and what is your, your organization's carbon target?

[00:14:40] Leo Glaser: So we currently are updating our carbon targets, um, on our website. We still have DD all on the, um, 80% by 2050. We have been looking into the science based targets. Um, we, uh, so for our asset management team, it was important to develop a decompensation before we announce any [00:15:00] targets, because we don't want be an organization that just announces a target but doesn't have an idea how to get there.

We wanna make sure that we have all our ducks in a row. We wanna make sure that our, uh, target is data driven and data based. And so that's why we worked with, with Brett together on, uh, pretty much developing this, this roadmap.

[00:15:21] James Dice: Got it. I have spoken a lot in public about, I haven't seen like, barely any roadmaps, basically none. I think I wrote a year ago that I had seen none and like at this point, Maybe one or two. Right. And then I got to Greenville last week and I saw two Canadian REITs, so I was very proud of, of you Canadians Last week when I was at Greenville, they, it was Quadri and it was another one that I can't remember.

I'll put it in the show notes. Um, but they basically had a very detailed roadmap and that was what the session was about at Green Build and it was Awesome. Um, so I'd love to talk about, [00:16:00] maybe start with you, Brad. How do you think about with your clients, getting them to where they've announced the target?

They have no plan to get there, They're hoping to figure it out at some point. Where do you start with, with credit, kind of like creating that roadmap with them?

[00:16:15] Brad White: Um, I mean, it's a good question and I, you know, I wouldn't say there's a one size fits all approach, um, for, you know, there's so many factors to go into it. And I'll, I'll say from the get go, I don't know that a hiring a consultant firm like us is the best way to start. Um, it can be, uh, and we can certainly help you get there.

I think increasingly I do see that sort of, that first step of work being done by a software platform, whether it's someone like Adette or, you know, there's a number of platforms out there now and I think, I think ultimately that's probably, um, How that initial step would be taken. Cuz I mean, we're kind of doing the manual version of that.

I mean, when we started working with, with [00:17:00] concert and Leo a few years ago, I mean we didn't, there weren't good platforms available at that point. So really the initial, and it's funny cuz it, we were doing energy audits and, you know, kind of traditional energy audits and they were, they funded by our utility and almost as an afterthought, we were including these low carbon options, kind of at the bottom, almost the bottom of the executive summary.

So we had all the usual energy efficiency measures. It was control stuff, it was equipment upgrades, and at the bottom it'd be like, okay, here are your kind of zero carbon alternatives. And it's funny that, that, that was wasn't a piece that the utilities were funding. That was just something we kind of did because it, it was relatively simple to add on once you've kind of done all the work of an audit.

Um, but it's, it's that piece that actually turned into. The roadmap that that has now, I think, and you know, Leo could, could confirm this, um, better than I could, but it has kind of turned to that zero carbon roadmap. Cause at the time, again, it was very early in that conversation and, and it wasn't sort of everyone's front of [00:18:00] mind, Oh, we need these options.

You hit a certain target. It was like, you know, in conversations like, Yeah, we're interested in in low carbon, can you just kind of let us know what that would look like, Um, sort of at a high level. And so, so we did, um, I said I find it really interesting that piece that, I don't wanna say it was a throwaway, but it was, in terms of the level of effort of the whole audit, it was like a few hours

Um, and, and it was the most important piece I think by far for, for concert and how they've planned and, and approached, um, you know, meeting, meeting their targets. So that's kind of how we did it. We were sort of in the buildings doing. You know, a more traditional energy assessment and, and um, and, and then yeah, I sort of did this add-on piece to look at, uh, you know, heat pump alternatives for, for various equipment types.

And then, um, yeah, you guys really seized on that and, and it's, you know, turned into a plan and, you know, actual projects now, like we've got sort of have, you know, delivered full projects at this point that, that kind of started with a one liner in a, in an [00:19:00] energy study a few years ago, which is, which I think is pretty cool.

[00:19:03] James Dice: Before we get into concert, um, I wanna circle back on the, the software piece. So we've had Christopher from Monette on the podcast before. Um, I've obviously written about how, you know, the energy spreadsheet must die and like we, we have to like, get away from doing all that manually. Can you just provide sort of your summary of what software needs to do there?

[00:19:26] Brad White: Yeah. And in full disclosure, you know that we've got a relationship with Adette AD was a Yeah. Spinoff from, from, uh, within ses initially it's, it's, you know, obviously become its own thing now, but I, you know, I was on the board for a while and stuff, so, um, I, you know, in terms of what I think where the software needs to go, um, is, is to really, And so maybe to take a step back, the best opportunity for any building to make that switch to low carbon is when they're in there replacing equipment anyway, [00:20:00] like the end of the equipment life cycle.

Like it's such a key leverage point in this whole journey to low carbon. Like, it, it's like the most important thing cuz like if you miss. Opportunity if you miss that window, like it's 15 years, probably before you're gonna get another shot at it. And, and with targets in, you know, the 20, 30, 40, 50 range, like we're now within the life, like the life cycle of, of key equipment where, you know, we're expecting significant, uh, carbon reductions to be made.

So, um, so I, in my mind, the, what the software needs to do is to understand that capital equipment like replacement cycle for any building. So, I mean, ideally it's a building owner who's got a, a maintenance database and they know roughly how old equipment is and roughly when they would wanna replace it.

Um, and, and to link that in with a zero carbon plan to say, Okay, well here, you know, this boiler. Will be [00:21:00] this air source heat pump and this rooftop unit will be, you know, this rooftop unit with a heat pump. And this furnace will be an air, so like, as step one and, and then like that's, that's like the minimum because now you can see, okay, here's, you can start to do the timeline to say, okay, this is when these major piece of equipment will likely need to be replaced.

And, you know, and to see how big of a dent that's gonna make in your, your carbon budget. Because if you know how big the equipment is and you know how big, how much the building produces in terms of carbon, like you can, you can ballpark it. Like you can get in the right, the right order magnitude anyway.

And, and then, and then start to see like, where does that get you, You know, if you know you've got, you know, 20 equipment replacements by 2035 and my target is 50%, like you can start to see like, am I in the right range or do I, like, do I have to do more than. Tackling these equipment replacements or, or is that actually getting me way past my target?

And I think software's really well suited to that because like that's all pieces of information that software can collect and you put in some basic assumptions and, and it can [00:22:00] start to like, plot that plan out for you. Um, so, and, and then, then you kind of have, and then you can see a priority list. You know, okay, these pieces of equipment are my biggest bang for my buck in terms of carbon reduction and this other building hardly uses any gas.

I'm not even gonna worry about that one. And, um, so I think if you get that full picture between sort of facility energy use, carbon production, um, like those, you know, scope, scope one and two emissions for, for each individual buildings and you know what kind of equipment you're dealing with and you know when it can be replaced.

Like that's step one. If you've got a handle and all that, then you're like, you're kind of halfway there.

[00:22:35] James Dice: Got it. And yeah, that makes a ton of sense. The thing that's interesting to me there is, um, that's a, a lot of that work, right? Is site level data being turned into site level plans, right? Um, I feel like where a lot of people start though, is not at the site level. And there's this [00:23:00] gap, right, where people are making like portfolio level targets, portfolio level plans, if you can call it that.

And then there's a disconnect between like that and the actual device that needs to be replaced down at the ground, right? Do you guys feel that?

[00:23:16] Leo Glaser: You're absolutely right. I, I think you can still have a, a portfolio target because you will have stronger performing buildings and some of them may already electrify it. So, for example, we have a couple of buildings in Victoria that barely use any gas.

For some reason, it's the way they were built was already, you know, having electrified or electrified building systems in mind. Uh, so their carbon footprint is extremely low. Are they extremely efficient? I don't know. Do I care that much anymore? Not really. Right. They're not on my priority list anymore because their carbon footprint is so low.

I think what needs to be done is in order to announce a, a sophisticated carbon [00:24:00] target, you have to have the site level.

[00:24:02] James Dice: Mm-hmm.

[00:24:03] Leo Glaser: I personally would start in, depending on where the organization is at, I would start collecting the utility bills and establishing a baseline. And I know that in, in many cases, small organizations or large organizations even hadn't started that yet.

So that was, that was key for us. I mean, we had some data collected before I started with concert in 2020, but we had a lot of gaps and we didn't have a energy baseline established and we were trying to fill all the gaps from 2018 until until now. Right. So, um, that took a lot of time now for reaching out to utilities, making sure we get the invoices cuz we wanted to get the data short.

And in order to get the data short, you need the invoices, uh, as, as, as a proof right when you get audited. So that, that took quite some time. And then, uh, second I would say, uh, what's, just to piggyback on, on Brett here, is to really align those identified projects with the equipment replacement schedule.

And that [00:25:00] way it comes really into. You know, talking with the site level staff and your asset manager who oversee the buildings, who know how much is in the budget and how much the, uh, you know, how much the building can pretty much afford, right? And so that's, that's what we did. So we formed this ESG comedy group of people from pro management, from asset management, and we started meeting, I think at the beginning, biweekly.

Uh, so we, before we started even the, the, we called them decarbonization audits cuz we wanted to move away from, uh, energy efficiency. We really wanted to focus more on, on, on decarbonization and, and decarbonization projects. So what we discussed with our consultants was, um, with Brett, for example, that we created an in-house spreadsheet, a spreadsheet everyone at concert would understand and has their metrics in there.

Cuz I look more into carbon reduction or how much is it gonna cost me to reduce one ton of carbon to kind of establish [00:26:00] a bit, um, Uh, and an idea how much our average project costs, right? So, um, but our asset management group wanted to see that present values and other metrics, right? I, I had not previously included.

So we created this master spreadsheet and that was shared with all our consultants across Canada. We, we engaged in this, uh, process of, of decompensation audits and then after all these audits were completed, we pretty much copied these projects together. And we had, at this point, I didn't know when these projects could be realized, right?

Cuz some were in the million dollar range. Audits were in a couple 10 thousands, completely all over the place, depending on the asset. Uh, but we sat together with our property managers and the asset managers to really go through each building's, um, equipment replacement schedule in each. and I mean, it's, it's still an ongoing process.

We have aligned to all these projects and there's a couple of hundred in that spreadsheet now for all 55 properties that we have in [00:27:00] our Scope one and two, um, emissions. And, um, the interesting thing is really like, uh, that, you know, obviously you have some years where you expect, uh, multiple systems to, to break down or, uh, their schedule for replacement in those certain years.

And, uh, like, like also like Brad said, right, you cannot realize all these projects in one year, but having the knowledge and having all this data allows you to reallocate these projects through the different years. So you can say, well, well maybe we have the ability to push the one bottle project out, or the one RTU out to another year and do only these projects this year.

So it gives you a lot of more flexibility. And one thing I also wanna mention here is that I ran in so many, into so many bottles that broke down. And you know, no one. Hat the time to really look into an electric, an electric alternative, right? Because you need to replace your boiler. That could be during the shoulder season or even in winter when it breaks down.

So you want to go in and make sure that your tenants [00:28:00] are, have heed

[00:28:00] James Dice: Mm-hmm.

[00:28:01] Leo Glaser: So in many cases you just don't have the time to do a decompensation on it. The good thing in our cases now, we, we know what to do. So it can happen time. We have the alternative. We have, we have an understanding, uh, you know what, what heat pump size we need to get, Obviously with take some engineering work to design the project, but at least we're not black

We don't have to boil, replace boilers for boilers. We know what it will take and how much will it cost to replace it with the.

[00:28:30] James Dice: Yeah, totally. So when you look at this list of several hundred projects, can you talk about what, what are the other inputs? Are there, is it only NPV for financials? Are you looking at net operating income? Are you looking at anything else like that? And then how do you prioritize projects? So how, what, besides like, these things are scheduled to be replaced on this year, or this thing broke down last week, How do you then [00:29:00] prioritize and then get the budget for, how do you pay for it?

Uh, the stuff that, that wasn't planned before.

[00:29:06] Leo Glaser: Yeah. So there's a couple of things that, uh, are key here. So first we also look into funding and funding opportunities for certain projects, whether that's here in BC or in Ontario, in Alberta. Um, and then we look into financial savings. So do we reduce enough gas? Do we actually see in operational benefit in it?

And in some cases, unfortunately, we, we don't, um, unless the efficiency of the, uh, project increases the building efficiency by still match that we actually, you know, save, save a lot of energy overall and that is reflected in the, the ongoing operational expense. Uh, in many cases, unfortunately, because electricity is still more expensive than gas, right?

We, we don't really see, uh, the savings there. But, uh, besides any financial aspect here, I would say that the prior, prior is really [00:30:00] given to the buildings that, uh, you know, have a heating system coming up, uh, for replacement. Um, because if, if, if they missed the one replacement, right? We're stuck with a boiler for the next 18 years again.

So it's really, really, timing is key here. And, and, and I just talk with our asset managers about this and uh, you know, because they ask me, Hey, does it still matter like how carbon, uh, inefficient building is? Would you prioritize the building? and I, I would say yes, we still do. I mean, we would still focus on those high emitters, right?

Cuz we obviously wanna reduce the, the, the, the current pollution as soon as we can. And, but it wouldn't be a bottle replacement unless the bottle is, is, is due, right? We would go in and see what else we can do to improve efficiency, but there's bigger items the heat pumps already used, MUAs, everything that can be electrified.

That's really just based on, on the equipment replacement schedule.

[00:30:57] James Dice: Got it. Anything to add there? Brad?

[00:30:59] Brad White: I was just gonna [00:31:00] say, like, I, I, I think that mindset like is really key for an organization that like every, every time you replace an equipment, like for like, is a lost opportunity. I think if you can kind of get to that cultural shift where, um, you're sort of appreciating that, like that is your opportunity because I mean, yeah, even if the building's not, you know, efficient, you should still do the decarbonization project if that's your only opportunity because you could do the efficiency after.

But if you put a new boiler in there, like it's gonna be really hard to get the low carbon equipment. after that because, you know, who wants to replace a brand new boiler? Right? So I think like it, in some ways it's counterintuitive, but I, I think for organization to actually be successful in make, you know, meaningful progress towards their goals, like on a big way that you gotta, you gotta leverage those equipment replacement opportunities, um, almost irregardless of whether it is like your highest [00:32:00] emitter or is otherwise a facility that should be prioritized.

Like, like you just, you kinda have to do it because if you don't, you're not, you're not gonna get to the deep products that you're targeting. Like, yeah, you could get 25, 30, 40% reduction maybe, but you're not gonna get 50, 60, 70, 80% reduction without those equipment replacements.

[00:32:17] James Dice: Yeah, I've been on a little bit of personal crusade to spread the term committed emissions around. So I was at Verge, the Verge Conference in San Jose a couple weeks ago, and I had, you know, I was speaking in a panel and I had a room full of a hundred people and I said, You know, raise your hand if anyone's heard, like who's heard of the term committed emissions?

And I was planning on calling on the person to have them define it, but no one in the whole room raised their hand, including the panelists, the other panelists. And we were talking about esg. We weren't talking specifically about decarbonization, but we were, you know, this is included in the ESG umbrella, Right.

Um, and not, not [00:33:00] a single person in the room unless they were being really shy, had heard the term committed emissions. And so I just feel like we have to like, figure out how to spread this knowledge of equipment replacement. Timing is extremely, extremely important. Um, I think everyone that's sort of in Leo's role is like, already understands that it's like the only lever we have, right?

Uh,

[00:33:21] Leo Glaser: Hmm.

[00:33:22] James Dice: I, I think more and more people throughout the industry need to understand that term. What is the role, This is kinda my last sort of portfolio level question then I kind of want to zoom in, um, kind of get into the, the, the ground stories. Um, what is the role right now from your guys' perspective in carbon accounting specifically?

So there's a lot of different software, you know, Features or entire software companies that are popping up around, Hey, I know you have utility bills and you have meter data, but it'd really be nice if you had accurate carbon data from that. How? How much [00:34:00] do you guys think about that piece of this puzzle?

[00:34:04] Leo Glaser: Well, I mean, we, we basically just follow the, the, the national standards, right? And apply the national, um, carbon emission factors to, to the energy sources across the country. , uh, we, we have, we are using an energy management tool, um, that does it automatically. Um, and then in the end, uh, every year we get our data assured.

Uh, so I, I, I'm not sure how much carbon accounting tools would add to that, to be honest. Um, I think we have a pretty good understanding. We, we monitor our carbon data, uh, constantly, I would say, uh, making sure that we don't have any gaps and, um, our data is pretty accurate. And then half the year, well by mid-year, the carbon, uh, The carbon factors change again, so you have to redo it [00:35:00] and update all your, your baseline data again, and yeah, so I mean, it's it keeps on changing your electrical current system.

Um, also the carbon intensity of your, uh, uh, electrical systems also changed. It's like, I, I, I think our data is pretty up to date or as up to date as it can be. And, um, yeah, not, not sure, but have you heard of any, any tools

[00:35:23] Brad White: I, I, I mean, we kind of do it the same way. I mean, honestly, I think the biggest challenge in all that is like accurate utility data and like if you ha like that's as you pointed to, I mean every, and you know, a lot of the organizations we work with, in fact, I would say almost every organization we work with has some issue with getting accurate utility data for their whole portfolio.

Like it's just a, it's a challenge that it takes effort. Like, you know, you guys have gotten there, but like that took you a lot of effort. Uh, and, and a lot of organizations aren't, aren't. I haven't finished putting in that effort [00:36:00] yet. And, and it's often, you know, the first thing we find when we come into work with a portfolio, I'm like, Okay, well give us the data so we can start to benchmark this for you.

And, you know, you, they either like, uh, well here's some of it. Okay, where, where's the rest? Um, or they give you stuff. It's like, are you sure this is right? Because this doesn't look right. Um, and, and then you, you quickly realize that, well, no, there, I mean, you look at enough energy data, you kind of know what you expect to see and you can tell, you know, right away, um, whether, whether it's, you know, garbage or whether it's, it's in the right ballpark and, and there's a lot of garbage data out there.

So honestly, to me, the biggest challenge with the carbon accounting is getting the utility data right. But if you've gotten the utility data right and accurate, then I think the carbon piece kind of follows. I mean, yeah, you have to mess around with emissions factors. And, but I mean that, that's honestly not that big a challenge in my mind.

[00:36:53] James Dice: Got it. Got it. Yeah. I've been digging into this, this category. It seems like people are improving upon, [00:37:00] at least in the US we have emissions factors that are. Are couple years old to several years old, and they're not necessarily always specific to your grid. And then a lot of times they're annual, right?

So they're not necessarily matching up with the time you're actually using power. Um, so you have, you know, technologies that are popping up and saying, Well, if you don't have hourly meter data, then we'll estimate it for you and then we can give you a lot more accurate carbon data from

[00:37:27] Brad White: Yeah. And that's really a, it's really a function of like what your grid looks like too. I mean, here in bc like it's not anywhere nearly that complicated. It's like they turn the dam on, they turn the dam off for the power. Like it's, it's pretty consistent. But yeah, there's obviously other jurisdictions where.

Turned up natural gas plants at certain times, and you've got that with, with, you know, other sources. And then I, I can understand that being a bigger challenge in, in, in some markets for sure.

[00:37:57] James Dice: totally.

[00:38:00]

[00:38:03] James Dice: Longtime listeners will remember. Brainbox AI from way back on episode eight of the podcast. And that episode we unpacked how brainbox allows you to add AI, specifically reinforcement learning to your existing HVAC control system, turning it into a predictive brain that learns precisely how to use less energy and optimize comfort in all buildings zones at all times.

With brainbox you can reduce your carbon footprint, lower energy bills and increase equipment life. Learn more by checking out the Westcliff shopping center, success story at the link in the show notes.

[00:38:37] James Dice: Let's, um, Let's dive into a couple different details of these projects. One is, I'd love to hear, maybe start with you, Brad, if you look across your clients, the types of technologies that are vital to making the roadmap happen, right? So we've talked about heat pumps. Maybe we can just gloss over that a little bit.

Obviously we need [00:39:00] to electrify loads that were not electrified. But what sort of smart building technologies or other technologies are you seeing as vital to this process?

[00:39:09] Brad White: Okay. I've got a few, I've got a couple soap boxes to stand on on this topic. So,

[00:39:15] James Dice: Please

[00:39:16] Brad White: uh, so. I'll say, and maybe I'll, I'll sort of preference by saying I think like, you know, we say, Oh yeah, put in a heat pump, like as if it is that simple. And you know, you get some cases where it is like you get rooftop units.

Sure. That that's pretty easy. Um, but like design, if we're talking about a central plant, which is, you know, a big boiler plant or even like a central domestic cloud water plant for some of these large buildings, like there, there is a lot of work into figuring out exactly what that replacement heat pump should look like.

Um, and I'll say the biggest thing comes down to like equipment sizing. [00:40:00] And this does tie into smart buildings in a second. All because, um, like as we are, and as Leo alluded to, like he pumped her expensive. Like I, I actually went to the effort one time. Doing a chart, and I think it was like dollars per btu.

Uh, and it had like kind of boiler, standard boiler systems, like high efficiency boiler systems, and then like heat pump systems. The heat pump costs are an order of magnitude more per BTU than a conventional gas boiler. Um, and, and it's really linear. Like it's just like you, you know, you can buy, you know, you can buy a million B2, hour per hour boiler.

You can buy one and a half million, uh, like B2 per hour boiler, and you're not paying that much more. And the install cost is kind of the same, Like the incremental cost of more gas capacity in a building, like for heating is not very high. It's not [00:41:00] like for electrified systems, especially if we're talking heat pumps.

It's, it's not that way at all. Like it's very linear. Like you want more capacity, it's going to be more expensive. You want twice as much capacity. It's going to be almost twice as. Um, both from like equipment cost point of view, install cost, you're kind of, you're bringing up electrical capacity. Like there's just, it, it's, you know, I think you, you, there's some efficiencies of scale, but not the way there is with gas systems.

So, you know, and, and the habit of, of engineers is to be conservative, right? Like that's, you know, one thing we're known as. So you oversize, you know, one way you're conservative is you oversize the equipment. You have these generous safety factors that you apply. Even if you go through the effort of properly sizing a piece of equipment, you usually tack on a bit of a safety factor.

Or you buy a second boiler for redundancy and you put that in and you call it a day, and you're left with way more boiler capacity than you actually need. Owners [00:42:00] can't afford to do that when they electr. , we, you just can't afford the same level of redundancy and like oversize equipment in my, in my opinion, like that is going to make the journey to electrification and decarbonization so much slower if you're expecting that same, that same level of, of sort of resilience and, and safety in, in, in your designs.

So the way you get around that is, um, especially if we're talking about retrofits, um, let's use the data, like, and, and this is something hardly any engineer does when they're designing a piece of equipment. Like you've got, we've got handbooks and we've got models, but in existing building we should be using the data.

Uh, and this is where the smart building systems come in because they can provide all of that data. Um, and what we have found when we've started looking at the data, Really interesting. You find out that a lot of the, the traditional rules of thumb and models are like totally wrong. Um, yeah, I'd like to give this example [00:43:00] from the domestic water systems.

Um, so we actually, um, we did, we decar decarbonized, um, a domestic cut water system. One of Leo built Leo's buildings recently. So we did, and it's a big, you know, a hundred and I forget how many suites are in there, a hundred, almost 200 suites. So it's, it's a good size building. Um, so we put a meter on there to, to actually measure the domestic hot water usage.

Um, and the profile, the usage profile was completely different from what the handbooks will tell you is kind of a standard domestic hot water profile in a multi-unit residential building. They'll say, you know, morning peak low during the day. evening peak. That's what it looks like. Of course, now we're taking, um, data, This was actually still kind of in the middle of Covid when we were doing this.

Um, but it's, it actually honestly hasn't changed that much since, um, that we saw kind of, you know, small morning peak, high load consistent throughout the day, another evening peak. [00:44:00] Um, but when we're doing heat pumps, like that really matters because. Uh, with, I mean, not to get too much into the technical side of things, but like the heat pump systems have a lot fewer BTUs, so you rely on more storage and you're, you kind of rely on these down times to recharge the system.

Well, knowing that the building's at a pretty high constant load all day really affects how much storage and, and, and, you know, the whole design of the system. Um, so I'd say without that data, we would've designed a totally different system, um, and, and one that, that wouldn't have served the needs of the building, uh, quite as well.

And, and, and just interesting that building before we did the project, it had two, 600,000 BTU boilers for domestic cut water. We ended up doing a hybrid system. Um, and this is kind of another story, but we had, we had to run on the boilers. We had boilers and heat pumps kind of together. Um, but, but we, for a while we had to run on just the boilers and we had two, 200,000 B2 boilers.

So one third the size. [00:45:00] That was enough for the building. Um, so the, the old system was three times oversized, um, from what they actually needed. And this was during the period when with higher than normal use because there's just so many more people at home now during the day in the building. Um, and then we've got, you know, same story I could tell you on the heating systems.

Like I, you know, the old saying goes is like, all models are wrong. Some models are useful. My opinion, especially with existing buildings, like forget about models. Like let's use the data, like let's leverage the BAS infrastructure. And I think this is a way that we haven't traditionally thought of these smart building systems either often justified and for building operations or for energy use for occupant comfort.

So I'm saying now like what I'm telling clients and sort of, Yeah. One of the soap boxes I'm on is there's another use case for smart building systems and for bas, and it is as like critical input data for designing low-carbon systems for your building that if you don't [00:46:00] have that data, you are not going to design your systems properly.

They will probably be oversized and a lot more expensive than, than they need to be compared to as if you had, uh, good data to design on.

[00:46:13] James Dice: Yeah.

[00:46:14] Brad White: So I think that's where smart building and, and then not even to get into the operation of these systems, but again, to, to use the example of this residential, I mean, they had, before they had two gas boilers.

I mean, you, you could run that whole system off in Aquastat, but now, now we've got 10 heat pumps and electric heater, two boilers, bunch of storage tanks. They're all connected and we've got mixing valves and it's a lot more sophisticated system. So we just, we need a lot more bas infrastructure to operate these low carbon systems compared to sort of conventional, uh, natural gas systems.

Uh, they're just, they're more complicated. And so you need, you need that smart building infrastructure to effectively operate them.

[00:46:55] James Dice: Absolutely makes perfect sense. So you're, [00:47:00] you're needing more, more controls, more sensor, more actuator, more more controllers, uh, than you had before. It sounds like also there's a need for analyzing the. Itself. Right? So some sort of analytics layer is helpful. Leo, how much of your sort of decarbonization roadmap is sort of intertwined with a technology roadmap if that exists?

[00:47:23] Leo Glaser: It absolutely is. I mean, we are currently piloting three smart building systems and, you know, buildings, uh, they're all three offices. Uh, we, we just wanted to see what we can do and, uh, how much we can improve the efficiency in those buildings. And we, we chose our two, um, corporate office buildings and we chose another building, having a portfolio that's already very efficient just because the team wanted.

What if we throw a smart building system into an already efficient building? Can we still improve the building even further? Or what else do we get out from, from this technology? Like what other information is there that's [00:48:00] possibly or potentially of value? And uh, so back in the day before these smart building systems became more and more popular where it's more, it was more like, uh, driven by young, young engineers going through the weather data and going through the BS data and hoping to find out why, uh, J one fires up in the middle of the night.

And, uh, so it was really interesting after they cleaned up the data and really dug into all the little details, we saw an average improvement of 20% in energy efficiency across office buildings. So that, that tells, and that changes the conversation again to efficiency, right? from, from decarbonization, which is, is

[00:48:42] Brad White: AI and machine learning is better than a skilled engineer, is what you're saying. ? Yeah.

[00:48:47] Leo Glaser: that's what I say. I, I've, we'll always see, I mean, like now AI systems are currently, I think at 15%, so let's see if they're as good as the engineers. But , um, yeah, so FO systems [00:49:00] been running since, uh, February one building, and I think we are currently seeing a 15% gas use decrease. So, Which is pretty good.

[00:49:07] James Dice: when you say smart building system, you're talking about sort of an advanced control

[00:49:13] Leo Glaser: Yeah, it's, it's like a brain. It's on top of the BS system. and pretty much takes, takes over, um, and, you know, gets, has access to seven day weather data and potentially if, if you have occupancy sensors in the building, it utilizes whatever information you can get right to, to run the building as efficiently as possible.

Um, so the plan is, um, and unfortunately a lot of our residential buildings don't have a BS system, or at least not a sophisticated BS system that could potentially be controlled by a smart building AI system in the end. So our strategy currently is to, um, to, to install these BS systems in those buildings that, that don't have it yet.

And then for the other buildings that already have a BS system [00:50:00] to, uh, look into some sort of AI technology to have that sitting on top of the B system to, you know, really adjust the buildings and run as efficiently as possible. And, um, also improve 10, 10 and comfort in the building.

[00:50:14] James Dice: So if I put my real estate hat on for a second, which I don't wear very often because I'm. An engineer, . But, um, if I sort of replay back this conversation, and I were to tell this to, you know, a property manager or an asset manager, we've talked about not having as much, not having a very good payback.

We've talked about electrification costing more, and now we're talking about all this technology that we didn't have before in certain cases that we have to add on now because the systems are more sophisticated. . How are you making that business case for all of this

[00:50:52] Leo Glaser: Yeah, that's the challenging part. Uh, with, with the AI technology, it's pretty simple cuz your pays are usually pretty good, right? Like the [00:51:00] installation or the, the, the upfront costs are not extremely high. So usually asset managers feel comfortable, , and then there areas potential to access funding. Um, and from various sources that, you know, it's also always a great, great incentive for, for the team to agree to a project that's a bit, you know, higher in the, in the upfront cost.

Um, I would say the

[00:51:23] James Dice: incentives and

[00:51:24] Leo Glaser: local incentives or even federal incentives, those, those type of projects are still considered to be pilots. So sometimes you're, you're lucky you can get access to, to those innovation funds as well that cover it. And um, but either way your feedback is usually pretty short, right? Cuz you expect operational savings and once the system is up and running, there's not a huge ongoing fee associated with it.

There's some software updates, but that's pretty much it. So, Systems up and running, and you really, you know, you see the savings and the [00:52:00] data and um, after two, maybe three years, it pays for itself. So those, those type of projects are usually pretty, pretty simple. It gets more complicated to sell a HEM project where the incremental cost is, you know, three times as high as SD initially batched it, uh, the cost for heat pump, or sorry, a bottle replacement or a standard rtu.

And, uh, one, one thing we noticed was, and that was part of our conversation audit exercise, we, Brad and his team and the other consultants who worked on this to uh, really show us like, how much would the project cost us if we, if we just went for the, like, for like replacement or, you know, switch out an old bottle for a high efficiency condensing.

And then option B would be, uh, heat pump combination, like a hybrid between boilers and heat pumps. And option C would be then the all electric. We noticed that option B in most cases gets us to, [00:53:00] you know, 70, 80% carbon reduction. Uh, so for the, the case, uh, we've been working with Brad on and, and at the, the residential building, we just ed at the domestic water system.

I think the, the overall building emissions and the gas usage went down by four, expected to go down by 50%. We have had some other heat pump and, and backup boiler projects where we could even see more, depending on if there's other equipment, um, that uses gas in the building or not. Um, but where I'm going with this is that, you know, if you wanna go all electric, we see that those last three or 20%, um, cost you almost as much as, as, as.

Those first 70%, 70, 80%. Right? So we've kind of like internally agreed to, let's not look into these all electric projects because we can't really justify it, right? Because like a lot of these costs are recoverable, so they have to be passed onto the tenants [00:54:00] in some form, depending on how these costs are, uh, are handled with the building budgets.

But anyways, when we look into these, uh, you know, hybrid options, the cost, I mean, Brad and Kurt, me if I'm wrong, we, we have seen positive paybacks if we consider life cycle costing and increased carbon tax, right? So that was the first time we ran the analysis and we got positive net present values, uh, due to the carbon tax and inflation and gas prices too. And those are the numbers here. Asset managers honesty too, right? I mean, they, they do agree. Yes, of course we have carbon targets in place as an organization. We need to get there, but we also wanna make sure that. The, you know, the, the numbers add up in the end.

[00:54:45] Brad White: Yeah, and I think, you know, to add, add to that, I think, you know, that that is, that's consistent with the conversation. You know, we, we have with. You know, other clients as well as to find, like, you know, let, let's [00:55:00] find the best path to low carbon. Like let's find those most effective, cost effective tons to save.

Um, and sometimes yeah, that's gonna cost you, you know, you do even end up slightly negative on, on the net present values sometimes. Um, but you know, if that's your best option then you know, okay, that that's our best option. And I'd say that really also when like the commitment, the organization's commitment to their carbon targets plays a role too.

Like if they are ironclad committed to those targets, then, then you can have a very different conversation then if it's a little bit, you know, wishy washy and they're not, some organizations, again, the ones that don't have that solid roadmap. And having done the work to get to the building level are still kind of shocked sometimes when they see what, what it actually means on a project by project basis.

And I found that even, even though they have the target, they're not, they're not quite comfortable yet, you know, taking the action and, and saying, Okay, we're gonna do the heat pump instead of [00:56:00] the, the boiler. So, um, I think the organization to get there, there really has to be that commitment to the roadmap and to, to the targets almost as a prerequisite to having the rest of the conversations.

Because if they're not there yet, it's gonna be really hard because, I mean, these are still new projects, like things, things come up, things go wrong. I mean, you know, Leo and I could tell you, you know, a dozen stories from this last project where, Yeah, I would say the commitment to that project. You know, if it wasn't there, it would've been easy at some points to say, Nah, okay, this is too much.

We're gonna, we're gonna bail and do the safe thing here. So, um, and I guess the only other thing that's coming into some of our conversations on top of kind of these internal targets that are driven by, you know, ESG programs is, um, it's, yeah, I know New York has local, uh, ordinance around carbon targets.

Vancouver has one now as well. Um, for a certain class of large buildings, [00:57:00] um, we call them the carbon pollution limits. It's, you know, it's so many tons per square foot. Um, and so now clients are actually looking at that. And since that was passed, having a lot more conversations, even with sort of clients who haven't been historically very sustainability minded.

They're like, Okay, what does this mean? Will this building meet those limits? If not, You know, what do I need to do to get there? And that's kind of entering the conversation now when we're talking about boiler replacements or, you know, other gas equipment replacements, it's like, okay, do I, is this going to be a problem for me?

And if it is, I may make a different choice, which I mean, honestly is exactly what the, the ordinances are meant to do. So it's, uh, I, in, in that way it's being successful. But, so we're starting to see the, the regulations come into, into play now. Um, in addition to, I mean, here we've kind of got, you know, it's almost the trifecta.

You've got sort of the, you know, corporate sustainability, corporate, you know, um, corporations wanting to sort of, you know, do the right thing because you [00:58:00] know their images on the line. You've, we've got carbon pricing signals and now regulations on sort of the other end saying, you know, this is a hard limit now, uh, that you can't exceed.

So the combination of those things, I think has really. At least, you know, here has, has kind of moved, moved the market for us and it is working its way into the conversations that we're having when we're planning projects.

[00:58:22] James Dice: Got it. Makes sense. Makes total sense. Yeah. And I'm hearing that from a bunch of different cities right now. So Brad, you said you had multiple soapbox items to, to bring up. Do you have anything else you wanna, you wanna stand in the soapbox

[00:58:35] Brad White: Well, okay. Uh, it's a, you know, it's along the same lines actually as the smart building. Um, you know, it's very much in, in sort of the smart building realm, but, um, and interesting to see how, how LEO and concerts kind of tackling it. Um, but, and you know, you heard Leo say, Well, a lot of our residential systems don't have, or a lot of residential buildings don't have much of a building automation system.

They don't [00:59:00] have much for smart building systems. But as soon as you decide to put in a low carbon system, if it's a central system, um, you are going to need that building automation system. And I think there's, you know, The commercial sector. I mean, we've been dealing with Recommissioning and Retrocommissioning, ongoing commissioning.

We've been having those conversations for 15 years. I'd say the commercial sector understands that well. But I think we we're going, our industry is gonna have a whole new challenge where we have all of these building owners who have not had sophisticated building automation before all of a sudden are gonna be in possession of them.

Uh, and, and we're gonna have this conversation all over. You know, 20 years after we had it the first time. Yeah. With new technology, with new tools. But I think that's something we need, we need to really be ready for. Um, because I mean, I even saw it again in this, this project that we did with Leo and even in the commissioning of it.

Um, yeah. The contractor didn't understand what this this system was meant to do. I, I had to [01:00:00] explain several times that no, no, we don't want to use the boiler, we want to use the heat pumps. That is the whole point of this project. The boilers are back up. Um, and to have to explain cuz people just aren't used to it.

Contractors aren't used to it. Um, you know, they didn't understand that this was a carbon reduction project. Um, or, or how this system was intended to operate. And that was good feedback for us as the designers and, and, um, you know, now that would be probably the first thing I would do on a. Startup meetings, sit them down and explain like the design intent and the functional objective of the building, and not just assume that, Oh yeah, they'll see the heat pumps and they'll know what's going on.

I mean, even with the sequence of operations, like we, you know, I had to go back and sort of walk them through, line by line, here's how we want it to work. Even though it was a relatively simple sequence, just like it was so different from what they were used to doing, um, that it was just, it was hard to get it to work the way we wanted.

And for a long [01:01:00] time it was like the boilers were running 24 7 and like we, you know, as the design engineer had to literally read the, the code line by line to figure out where it wasn't right. Point that out to the programmer so that they could go fix it. Like it, it was a painful commissioning process, um, that, um, we had, And it would've been honestly kind of easy to say, Yep, everything is done.

Go through your commissioning checklist, check it off, leave them with a system that. Is maybe getting 10% of the carbon reduction that it, that it had the potential to get to because of, you know, a few lines of code being wrong. And you can imagine what that means for persistence and like how on it now, you know, the operators are going to have to be for the life of this system to prevent the, that sort of thing from happening.

And we've seen it for years in recommissioning ongoing commissioning. But I would say the stakes are higher now because virtually every one of these hybrid systems that we've worked on and we've worked on [01:02:00] a lot that we haven't designed, we get called in to do recommissioning projects. Nine times outta 10, the boiler is running and the heat pump is off.

Or the heat pump is barely doing anything. It's like it's tripped out. It's like, and no, like nobody knows. The operator can't be bothered with it cuz they see it as this, you know, high maintenance piece of equipment. The boiler satisfies the tenants and they know how a boiler works. They're comfortable with that.

But meanwhile, the owner who has spent a lot of money on these little carbon systems isn't getting the value out of it. Um, and so this is gonna be, I mean, it is a problem already. And I can only imagine, you know, the scale of, of the problem as we go forward and start to roll out, you know, start to decarbonize on a large scale.

And this is where I've kind of thought that the, the conversation that, you know, a lot of the conversations focused on, okay, how do you find, how do you prioritize the projects? How do you do the projects? Let's find a heat pump, put in a heat pump. And I'm kinda like, well, yes, like that's [01:03:00] important, but let's not underestimate the challenge in front of us from what these heat pump systems are in because, um, keeping those systems working, uh, and delivering on the carbon reduction is, is gonna be an ongoing challenge, uh, that our industry's gonna have to tackle.

And, and I have to take really seriously because I, I've already seen a bunch of these white elephants that, you know, a bunch of money spent on a, on a project that's not delivering, you know, the carbon reduction that, that it was supposed to. And I think, you know, that also creates a bad reputation. People say, Well, I spent all this money, I'm not getting.

The value out of it. Why would I keep spending money on this that could kind of derail the whole car, uh, decarbonization challenge. So anyway, I think our industry needs to take that really seriously and, and get out in front of it. And, and that's a challenge from, you know, starts with the consultants, but goes through, you know, the contractors and the operations teams.

Again, nothing different than the conversation we've been having in the commercial real estate side for forever, but we're gonna have to keep [01:04:00] having that conversation and, and, you know, bring it kind of into the, into the 2020s with us because it's, it's gonna be there.

[01:04:07] James Dice: I'd say it's a huge obstacle though, because not we have been having this conversation. I mean, I, I spent a lot of my career so far having that conversation, which is, it's important that you commission your control system and then you also probably want analytics and monitoring also. Right. That was, you know, a huge part of my career so far.

Um, but not everyone has. Taken that to heart. Not everyone has listened to that message. Not everyone has implemented that message, and so I guess it's, yeah, it's a big obstacle for then taking, taking that and expanding the number of buildings that now have more sophisticated systems now have control systems now need those control systems to perform.

Yeah. I totally, I'm totally with you. It's a great, great lesson.

[01:04:54] Brad White: I mean, there's opportunity there too, and I think this is where our industry needs to, uh, you know, understand this [01:05:00] push for decarbonization and, and understand that it, you know, this isn't just about he pump manufacturers selling more, he pumps. It's about everyone in the smart building industry upping their game.

And, you know, there, there's a big opportunity here to sell our services to, to make, you know, make the low carbon building work. Um, and I think we, we can't undervalue our role in, in. But understand that, you know, these conversations are, are taking place around carbon and, and that that is a driver now for, for investment in buildings.

And, you know, increasingly I know, you know, as part of the, you know, inflation reduction act in, in, in the US and Canada's looking at similar legislation here, like there's a lot of money going into low carbon systems. Um, and that, you know, I think the smart building industry's role is to make them work, right?

[01:05:47] James Dice: Exactly, which is why we're having this

[01:05:50] Brad White: Yeah.

[01:05:51] James Dice: So let's end. Leo. I wanted to, So back to the fact that you guys are ahead of the game in terms of creating a plan, creating [01:06:00] a roadmap that actually has real actions in it. , um, can you give, let's just close off with some tips that you might have around other, like just others that are behind you on that journey to get to that sort of concrete plan.

What tips do you have?

[01:06:15] Leo Glaser: Yeah, so my tips would be to focus first on, uh, getting data, right? Like before you start any, uh, carbon commitments, targets, or even looking into projects, you need to have a solid baseline. And, uh, so that that allows you to, you know, make any assumptions for your carbon target. Could be, could be at. And so what I've seen in the industry and, um, that worries me too, , we talked about at the beginning that most of these targets, whether that's 50% by 2030 or curve neutral by 2050, um, they're purely based on, on, on an assumption or organization signing up for the science based target initiative and.

I'm, I'm, I'm glad a concert is, one of the [01:07:00] organizations said like, That's, uh, too scary for us. We do not want announce a target. And, uh, you know, by 2028, uh, we reduced our car by 10% or it just didn't work. So what I highly recommend is, um, looking into every building and, uh, either that's with a consultant or with the onsite staff and, uh, checking the, uh, equipment, replacement schedules.

And I would put a list together of those buildings, uh, that are coming up in the next few years. And, uh, I would focus my decompensation room and those buildings because, like we said at the beginning, if you miss, uh, a boiler system or a heat, or a rooftop unit or anything now, then you're gonna be stuck with the old system again for the next 15 to 20 years.

And, uh, so with, with that data, uh, I would just. Develop this roadmap and come up with an estimate how, what is a real number that can be achieved in [01:08:00] the next seven, eight years? And, uh, without promising anything, I would, uh, I would also discuss that with the asset management team if they feel comfortable, uh, implementing these projects.

Because like our senior management team, although we have those numbers and we have the costs and we have the carbon reduction predictions based on the consultants analyses, we're still hesitant announcing at Target publicly because a lot of these projects are still in, in, in very early stages. And a lot of them are pilots.

Uh, even though Smart Building Project is, is still a pilot. Right. It has not even tested in, in here in, in Vancouver, at least along along the west. So we don't really know if the predicted, uh, you know, carbon savings are 15%, 20% or less. So we'll probably wait a couple of more years before we make an announcement just to get more data and more information.

And I think that's key. I think everyone should collect data as much as they [01:09:00] can. And, uh, then also like, share the outcomes of each project cuz uh, the project we're currently working with right on will be an exciting one because we have the exact same building right next to that one. So it could be a carbon copy of the project if it turns out to be as, uh, you know, efficient and, uh, the carbon reduction, um, holds what it promises.

Then this project could potentially be implemented across our BC portfolio, uh, at all sites that have a similar. So I think, you know, it will be a lesson learned. I think we have to share a lot of information in that field because a lot of the heat pump technology, or the way we are currently installing it with the backup, uh, boilers is, is so new to, to many landlords and property owners, right?

So I think the more we share from our experience, the, the better or the easier it will be for is to make a similar decision.

[01:09:50] James Dice: Totally. close out with some, what I call carve outs. Um, any book or podcasts or, you know, any other [01:10:00] type of media really that has had a major impact on you lately. Start with you, Brad.

[01:10:06] Brad White: I'm glad, I'm glad there's a heads up for that question. Um, I'm, I'm a, I've got, I've got young kids. I don't know how much time to read. Uh, but I, I, I do listen to a lot of podcasts and, uh, I would say lately, uh, the one that's had the most impact in my thinking, it's, and you, it's one I'm sure a lot of people have heard of is, um, Malcolm Gladwell's Revisionist history, uh, podcast.

But I just, what I like about it, not, I mean the content is, is often fascinating. The way, it just takes a total different perspective on something that either you've never really thought of in depth before, or you've already kind of thought of one way and just kind of flip the way you look at something.

Um, I, I, you know, I try to, I try to keep that in mind for, for my work because, um, [01:11:00] you know, I think often there's, there's interesting answers when you just, you look at a problem from a, a different perspective. So yeah, that's, that's one I've been enjoying because it just always is kind of a challenges your expectations and Yeah.

Makes, makes you think,

[01:11:14] James Dice: Brilliant. I remember I listened to the first couple episodes, but, uh, haven't listened to it in a few years. Maybe I'll circle back

[01:11:20] Brad White: good. Fellow, fellow Canadian,

[01:11:22] James Dice: There you go. How about you,

[01:11:24] Brad White: expat, but.

[01:11:26] Leo Glaser: Uh, so I would say I've been reading a lot of frameworks lately. Um, I presented Audiation Roadmap at Buildex, um, earlier this year. Uh, I can't remember the, the context here, but, uh, we, we, we started discussing different ESG frameworks and so it kind of like triggered a whole conversation around our own framework, whether that's still up to date or not up to date.

So I started reading a lot of frameworks that are currently out there from international organizations pretty much all over the world. And, um, yeah, that really helped me [01:12:00] to understand what, what others are doing in the field. And, um, yeah, what, what other, what, what opportunities are out there, uh, regarding podcasts?

I do like listening to the economists, uh, particularly the topics that are on the energy market, the energy crisis in Europe, , I think there's a, there's a lot we can learn here in, in North America too. I mean, we're less affected luckily, uh, than the European market, but, um, it's also kind of changed, changed my way of thinking of how we, how we use.

Energy and how easily, you know, uh, prices for gas or electricity can increase rapidly.

[01:12:38] James Dice: Totally. Back to the frameworks. What, what are the top one or two frameworks that you, if you've, you've dug into this topic, where would, where should people start?

[01:12:48] Leo Glaser: Oh. So, um, what I noticed is that these frameworks are pretty much all over the place. . Yeah. There is, there's no real guidance, like what you have to include in your framework [01:13:00] or what, what, what if it should be combination of, you should report it in a framework. If it is document that's 60 pages long, or policy that's three pages long, which is great, right?

That, that also makes me wonder like how much do we actually know about these things, Right? If there's no, no consistency even in how we develop our frameworks.

[01:13:22] Brad White: pretty sure we're all just making this up as we go along.

[01:13:25] Leo Glaser: Probably . You can also tell by like how often these frameworks are being, being changed. So, um, well, so, so we were back at the drawing board again at concert too to redesign our framework.

I mean we had a 2019 version uploaded to our website. It was 64 pages longer. So we noticed that's might not be the easiest document we can share with the organization cuz who reads 64 pages. Right. So if we could get that down to five pages, maybe , that would be key. Well, we'll see how that goes.

[01:13:56] James Dice: Got it. All right, well thanks you two. This has [01:14:00] been super insightful. I like how practical down to earth it is from real experience. So thank you for sharing

[01:14:07] Brad White: Cool. That's, yeah, it was fun

[01:14:09] Leo Glaser: Yeah, that's awesome.