A conversation with Marsha Costanzo from GPT Group in many ways encapsulates the fundamental changes in our energy landscape for buildings and beyond.
In commercial property, just one major challenge in the current energy crisis is the shift underway from net leases to gross, where the owners are responsible for the outgoings.
Costanzo, the company’s national manager for operational efficiency and energy, says this is ultimately a commercial decision, influenced in part by the competition to attract and retain tenants.
For owners, it intensifies the pressure to reduce operating expenses – energy in particular – without compromising tenant conditions or asset performance, she says.
But for Costanzo that’s not a problem: “I love the challenge of demand management,” she says.
- Don’t miss Marsha Costanzo at the Transition Risk masterclasses in Melbourne and Sydney, where she will share the lessons and strategies developed during her nearly 24 years at GPT
Her role spans GPT’s business utilities activities, including electricity, water and gas embedded networks, as well as operational building environmental performance across the portfolio. The business is also developing a more consistent approach to thermal energy; including chilled water and heating hot water generated by central HVAC plant.
In her approach, Costanzo works with the company’s engineers and analysts to “test commercial opportunities against technical evidence” with questions such as: “What’s driving demand? When is energy intensity highest? Can consumption be shifted or reduced? What is the cost impact? How do we maintain thermal comfort?”
The objective is to find solutions that can be scaled across the company’s diverse portfolio, which includes office buildings, shopping centres and logistics assets.
A range of techniques can come into play. Pre-cooling, for instance, can work well in offices, but not so much in retail property thanks to big entrances and constantly opening doors.
There’s a lot more opportunity with offices where buildings are closed, and airconditioning switched off on weekends, generating an accumulated heat load that can be pre-cooled before people arrive at work.
“If we know Monday is going to be a 40 degree day in Melbourne, we can prepare the building and cool it earlier to build momentum into the day,” Costanzo says.
The asset might also take part in demand-response events by temporarily reducing its electricity consumption or moving away from grid supply during a nominated interval.
“We’ll curtail our load or come off grid for that 15 minute interval that the energy network is asking for. But we’ll only do it to a point where we don’t compromise conditions for our tenants,” Costanzo says.
“If we’re required to maintain 24 degrees temperature, we won’t compromise that. You also need to manage how the plant comes back online. If the plant restarts at once, you can create a new peak demand event and incur additional costs for the rest of the year.”
Batteries can help spread the load, but they are, so far, difficult to incorporate in office buildings, thanks to space limitations and safety considerations, such as fire risk and thermal runaway.
But shopping centres generally have more space.
The company now has four batteries in three centres, including two in Highpoint Shopping Centre in Melbourne, which can respond when site demand approaches a threshold.
“Load flexibility is required all the time,” Costanzo says. “When demand starts to ramp up and approaches the agreed limit, the battery can respond. That is where it can work to our advantage and help us avoid excess charges.”
Planning is key to demand management
Costanzo’s team works with GPT’s capital team to align planned upgrades with the company’s energy strategy, electricity procurement and operational requirements. This information is also shared with the company’s energy retail partner, which can assess potential energy efficiency opportunities and estimate the energy certificates that may be generated.
New assets are also assessed for solar potential, demand flexibility, opportunities to generate energy certificates, plant optimisation and other operational-efficiency initiatives, Costanzo says.
Sustainability dividends have wide impact
For Costanzo, sustainability equates to “prudent asset management”.
“The perception can sometimes be that sustainability does not have a commercial outcome,” she says. “What we’ve worked hard to demonstrate is that prudent management of a building delivers a cost benefit, a sustainability benefit and a social benefit.”
Reducing and shifting electricity demand can also contribute to the stability of the broader electricity system.
“If we’re helping to stabilise the grid, that benefits the wider community.”
Don’t miss Marsha Costanzo at Transition Risk – get your tickets here.
