Maximize Savings with a Sustainability Master Plan

The Right Plan Turns Sustainability into Savings

As we explored in our previous article, sustainability is more than environmental stewardship. It’s long-term thinking that prioritizes actions that benefit the planet, our communities, and the bottom line.

Many businesses encounter a short-term problem in pursuing their sustainability initiatives: Sustainability initiatives function best when developed cohesively and intentionally, but business factors often lead even well-intentioned teams to approach it in isolated steps, reducing sustainability impact and savings.

Consider a commercial real estate company that installs solar panels in an effort to generate clean energy and reduce costs. Their savings will be dramatically smaller if they don’t optimize the solar installation for maximum output, proactively plan which meters it can connect to, run periodical rate optimization strategies on the array, and ensure proper operations and maintenance practices are in place.

Reactive or partial-effort approaches leave money on the table and fail to capture the full potential of sustainability initiatives. This, in turn, leaves business leaders less inclined to devote resources to what they see as an underperforming, if well-intentioned, sustainability effort.

A Sustainability Master Plan (SMP) changes that. These plans align sustainability efforts with business objectives, unlocking efficiency, cost savings, and new revenue streams. Large real estate owners particularly benefit from strategic, multi-front initiatives that confront poor utility management, untapped incentives, and inefficient energy procurement. When they take a structured approach, the financial upside is massive.

What is a Sustainability Master Plan?

An SMP is a strategic, data-driven roadmap that transforms sustainability from a cost center into a profit driver. Unlike one-off sustainability projects, an SMP ensures that investments are timed, structured, and optimized for maximum ROI. SMPs provide crucial, structured frameworks for setting clear goals, allocating resources accordingly, and measuring progress toward objectives. This, in turn, empowers businesses to embed sustainability as a core value aligned not only with their values, but also with their finances.

What Comprises a Sustainability Master Plan?

SMPs leverage a variety of tools to maximize ROI.

Timing is one such tool. Sustainability projects make the most sense when incentive programs, utility rates, market conditions, and technology align. For example, a logistics company that strategically times an EV fleet transition to coincide with scheduled fleet replacements, infrastructure upgrades in solar charging and storage, and timely incentive opportunities

Another tool is a simple utility analysis, which can often uncover significant wasted energy, such as meters that continue to accrue flat monthly charges even with no usage or a recurring process that results in accruing energy charges at a time of day with rates 5x higher than usual. These low-cost analyses can generate savings that fund other parts of the SMP.

Rebates, incentives, and tax structuring can function similarly. By properly structuring an approach, businesses can capture millions in government incentives, oftentimes turning planned capital expenses into instant cash-flow wins.

Even optimizing existing systems can generate massive savings. Most building management systems are underutilized, using outdated settings or operating primarily manually instead of being finely tuned to operate efficiently, all without impacting the user experience. In a well-structured SMP, energy savings can fund additional sustainability initiatives, creating a savings feedback loop.

When businesses adopt a long-term approach to sustainability, they become attuned to opportunities in the energy market. When conditions are right (timing is critical), they may leverage energy procurement strategies to lock in a long-term energy rate, often saving money and providing valuable budget stability for energy costs.

SMPs Meet Unique Business Needs

None of these strategies is incredibly challenging, but synthesizing them into a single cohesive strategy that meets the business’s needs is difficult. ROI is but one need. Companies must continue to generate cash flow, serve their customers, cut costs, care for their employees, solidify their reputations, and compete in a market increasingly recognizing the benefits of sustainability strategies.

SMPs help organizations maintain consistency and vision to help plans remain steadfast despite competing priorities, cost-cutting needs, and leadership changes. They do so by pursuing a deeper buy-in from upper leadership in the first place and by implementing initiatives meet their financial targets. They also incorporate feedback from facilities teams, who are often most aware of issues that indicate inefficiency. Fixing these issues creates buy-in from the frontline, compounding program effectiveness. Programs without these qualities lack the robustness to weather common organizational challenges.

A Sustainability Master Plan is a cornerstone – a commitment to a long-term investment toward sustainability, focusing on what we do tomorrow, not what we did yesterday. The plan should highlight various considerations, including:

Resource Efficiency
Supply Chain Management
Stakeholder engagement: internal groups, financially interested parties, and the broader community
Regulatory Compliance
Risk Assessment and Management
Growth and Ongoing Impact
Continuous Improvement

Real-World Hypothetical: A Real Estate Giant Unlocks Millions in Savings

Background:

A major real estate company owns a portfolio of upscale shopping centers in multiple states. Despite rising energy costs, it has never conducted a deep-dive energy audit.

Let’s look at the difference an SMP could make:

Discovery Phase:

Utility data analysis reveals several meters still running in vacant spaces, costing hundreds of thousands annually.
State and utility incentives are offered for LED retrofits, HVAC upgrades, and smart controls, covering the majority of upgrade costs for energy efficiency projects.
Analysis shows they are overpaying for energy by 15% compared to if they leveraged their scale and purchased their portfolio’s energy consumption via a third-party energy supplier.
BMS inefficiencies show that several systems run 24/7, even when properties are closed.

Action Plan:

They optimize BMS settings, reducing energy use by 12% in short order.
They leverage incentives to install superior controls, LED lighting, and HVAC retrofits for pennies on the dollar, further reducing their reliance on expensive grid electricity.
They lock in energy contracts, saving millions in procurement costs and adding price stability to their budget.
With the money saved, they invest in solar panels and battery storage, allowing them to produce clean electricity onsite, offset costly peak demand charges, and improve business resiliency.
They install EV charging stations, driving traffic to their centers and creating a new amenity for shoppers and revenue stream from drivers.

Results:

The first tranche of investments saves the portfolio over $2 million per year in energy costs.
Seeing success, the company expands the program to a second major tranche.
The compounded, cumulative savings and reduced operational costs turn their sustainability initiatives into an investment strategy, increasing portfolio value. Even though the company plans to divest some assets, the sustainability initiatives put in place are worthwhile in the short term, as buyers value the reduced operating cost and new equipment, increasing the sale price.

Creating Your SMP

Developing an SMP requires partnering with employees, advisors, and industry experts to craft a strategy that fits the organization’s goals.

If you would like to learn how the Olympic Sustainability Group can assist you in navigating complex sustainability challenges and moving towards innovative solutions, please email us at info@olympicsustainability.com.