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The Metaverse, Digital Twins, and Building Decarbonization

by Elwin McKay-Smith | May 26, 2022 | Energy Management, Smart Buildings, Sustainability

After the former-company-known-as-Facebook rebranded itself in late 2021 to Meta, much of the world discovered the “metaverse”—the next generation of human connectivity that would fundamentally transform how we socialize and work.

According to Zuckerberg’s vision, the metaverse will be a place where social interactions are completely virtual, with self-created and customizable avatars interacting in ways that seem so real, we will easily take them as such. The new digital reality would affect work too, allowing workers to be at the “office” without leaving their home or changing out of their sweatpants. Remote workers no longer need to worry their physical office cohorts will race ahead, grabbing the next promotion or swanky project. Everyone would work in the same “space” regardless of their physical location.

The move to an immersive digital social life will certainly have massive implications for society, but building a new digital Agora for the modern world only scratches the surface of what the metaverse will be. That’s because its value extends beyond video games, social media, and the workplace. In fact, the sector to feel the most impact of these new virtual spaces will likely be today’s very real built environments.

Building Digital Twins

One key aspect of the metaverse for the built environment is the digital twin—a virtual doppelganger of a physical object or process. The notion of such a digital double is several decades old and the culmination of advances in 3D/BIM software, machine learning, and virtual technology. While architectural drawings have rendered 2D renderings of buildings for hundreds of years, 3D software added that extra dimension. Later, virtual reality would make the fourth dimension (time) possible. These advances set the stage for modeling physical processes like the human body or providing virtual walkthroughs of spaces like residential and commercial buildings.

However, digital twins serve a more important and practical purpose than visual mimicry; they attempt to model reality itself. To do this, digital twins must account for as many data points as possible. This includes every object, process and system that exists within a building—from the largest HVAC plant to the smallest occupancy sensor. All digital building systems function within a virtual world dynamically modeled to mimic the dimensions of time and space and natural forces. In short, the virtual world contains the same physical limitations as its physical counterpart.

The advantage of a digital twin, whether it be a building or an entire city, is that you can make changes and see what happens without doing it for real. This can be advantageous when time and costs are too great for real-life recreation or when impractical or impossible. Climate scientists, for example, use digital twins of the Earth’s weather systems to make predictions about the effects of global warming.

The more data points that make up your digital twin, the more accurate your simulations. In this way, data points function much like pixels that make up a screen, in that the more you can pack into a model, the higher the “resolution” and more life-like images you get.

However, such huge buckets of data take enormous amounts of computational power to process and manage. That’s where artificial intelligence and machine learning have helped give birth to the metaverse. Sophisticated algorithms do much of the “thinking” for us—locating patterns, making connections, running simulations and spitting out the results. Without them, modeling of systems is a rudimentary process, and it’s only relatively recent that we’ve been able to handle enough data to represent a virtual facsimile of complex physical processes and systems.

Helping Speed Up Building Decarbonization Adoption

As the metaverse takes its first steps, markets are already pricing in the tech’s potential to transform the built world. From a current global market size of $3.1 billion in 2020, experts project the digital twin market will reach $48.2 billion by 2026. Such growth is why some engineers, architects and entrepreneurs are looking to the metaverse and AI technology to help lower carbon emissions. In fact, an Ernst and Young study found that digital twins can reduce a building’s carbon emissions by half.

Founder and CEO of Cityzenith, Michael Jansen, oversees a digital twin platform that’s leading the push to decarbonize entire cities using metaverse technology. Recently Jansen hosted a live event laying out the current challenges to building decarbonization and how investing in digital twins can speed up green capital investments in the U.S. One pain point for property owners is retrofitting costs, which the CEO estimates at $4 to $7 USDs per square ft ($21 to $75 per sq m). “When you consider the fact that building owners spend about $2.10 per square foot on energy annually, it’s a large number,” Jansen states.

Another hurdle to building decarbonization adoption is the inherent conflict between the short-term gains investors demand vs the long-term investment that sustainable retrofitting requires. “The payback periods on typical [green] retrofits can be 10 to 15 years,” Jansen explains. “Those at the top of the investment pyramid typically look for returns within three to five years. As a result, a lot of these investments just don’t happen.”

While Jansen admits there are many challenges to green investment and adoption, he believes data is the obvious answer, at least for the short term. But buildings and cities contain thousands of software platforms, untold sensors, and BMS systems sending and receiving gigabytes of data through the air and over wires. It’s understandable that building managers can often feel as if they’re drowning in a sea of data and the digital tools that fill it.

Jansen claims it’s this “chaos of tools” that’s slowing building decarbonization efforts throughout the market. However, it’s understandable property owners would sidestep solving the issue of data glut, especially given the more immediate threats like higher construction costs, supply chain issues, swelling energy prices, and a shrinking demand for commercial office spaces.

Still, the Cityzenith CEO is correct in the assumption that funneling the increasing volume of data streams into a singular control is a desired outcome for most property and city managers. In fact, it’s this same consolidating impulse that’s motivating the move to integrated systems and open protocols within BMS technology today. Consolidation certainly increases data points, which is what digital twins need to be effective.

What’s needed is a “system of systems,” Jansen says. “The purpose of building a kind of metaverse around all of this…was to allow all these decarbonization processes to happen in one common place. So, all that activity could be studied and simulated before anybody actually spends a dollar. We use digital twins to predict energy consumption and financial outcomes to help drive down capital risk and increase adoption.”

Metaverse for Asset and Risk Management

While digital twins have numerous upsides for building decarbonization and efficiency, they can also help property owners and managers safeguard their investments. With aggregated data from building systems, equipment, and real-time sensors, digital twins can run physics-based models built on “what-if” scenarios.

Building and city managers can ask energy-related questions like “What if we bought 10% more solar and wind energy?” or “What if we generated more power on-site with roof-top solar array?”. After running such scenarios through a digitized property, owners would have a more accurate picture of the financial and operational impacts before committing. More importantly, they could easily tweak their input data until the outcomes fall within acceptable limits.

By using digital twins to accurately see future outcomes, property managers can also bolster their risk management. “What-if” statements can also apply to emergency situations like pandemics, natural disasters, and social upheaval. During COVID, many property owners scrambled to adjust to sudden lockdowns, indoor air quality demands, new hygiene mandates, and occupancy management challenges. Digital twin simulations of these variables could have better prepared owners and managers for the challenges while saving time, money, and possibly lives.

Sources:

“Cityzenith’s real world metaverse for decarbonization”. Published April 21, 2022, accessed April 28, 2022. https://youtu.be/l0L_7gwguoA

“Digital twin: the Age of Aquarius in construction and real estate.” Todd Lukesh, Eric Ottinger, Nipun Bajaj, Jordan Stein, Erica Crandon, Mark Gibson and Akanksha Jain. Published May 2021, accessed 27 April 2022. https://www.ecmag.com/sites/default/files/Digital%20twin%20-%20the%20Age%20of%20Aquarius%20in%20construction%20and%20real%20estate.pdf

“Digital Twin market”. Markets and Markets website, , accessed 25 March 2021, © 2021 Markets and Markets Research Private Ltd. https://www.marketsandmarkets.com/Market-Reports/digital-twin-market-225269522.html

“Everything Facebook revealed about the Metaverse in 11 minutes”. CNET. Published October 29, 2021. Accessed April 26, 2022. https://youtu.be/gElfIo6uw4g

Tips for Calculating an After-Hours AC Rate

by 7NOX Team | Aug 26, 2021 | After-Hours HVAC, Sustainability, Tips

After-hours HVAC charges are a sticky OPEX budget item. Normal core hour rates are predictable. Power providers determine your property’s kWh costs for you. But with after-hours AC, managers must calculate the hourly rate themselves. And it’s work that needs to be done right if you want to recoup your full utility outlay.

With figuring after-hours AC rates, you get as much as you give. The more detailed your cost analysis, the more accurate your rate. And an accurate rate will refund your actual utility cost per hour, an inaccurate one won’t.

But determining detailed costs also takes time—your time—and that’s valuable. There must be a middle ground—an approach that minimises time while maximising resource win back. To locate it, we approached FMs working today for their input on striking a balance. Here’s what they told us.

Lock In the Parts of Your AHAC Rate Early

Most after-hours AC rates need to include more than electricity for chillers and boilers. For sure, there’s the fixed energy cost of your HVAC system to consider (more on that later), but what about other resources and services you provide? Lock in these costs early. It will give your calculation process more focus and direction. But what are the other costs?

If you’re managing an office space, your tenants may need access to lift services, parking and hallway lighting. If you’re a university, you may need to add security and cleaning services to the charge. FMs with manual AHAC programs need to include an admin fee to cover staffing costs. Someone will need to record the after-hours request, program the BMS and handle cancellations.

Start with the most obvious expenses and work your way to more granular items. Go as far as practicable for your situation. Some guess work is inevitable, but at least identify each hard cost. You can always discard extraneous ones later. Besides, you’ll need the list later when drafting your AHAC clause for your lease. Listing excluded costs in your lease is a smart way to quell tenant complaints about future AHAC increases.

Fixed Energy Cost: “Keep it Simple”

Since it’s your biggest electricity hog, your HVAC system will make up the bulk of your energy use for AHAC. Therefore, it results in the biggest potential for annual OPEX losses. So accuracy literally pays here.

The simplest (least accurate) method would be to divide your annual energy bill by the number of standard operating hours per year. It’s a simple, but rough estimate that lumps every kWh into the same basket. It tells you how much it costs to operate your property, not your plant. The lack of kWh discrimination could result in under or over-charing tenants and making your property less profitable.

At the other end, an FM could attempt to record their plant’s actual kWh usage in real time. Smart meters and EMS equipment give real time feedback, but they’re expensive and complex to integrate. Stuart Bryant, GM for a large property holder in New Zealand, explained how his company attempting to calculate their AHAC costs with smart meters:

“In one instance, we installed a series of TOU meters across all distribution boards that controlled the mechanical plant to work out the ‘actual’ energy usage. This worked but was complicated, and I wouldn’t recommend it.”

Such a granular approach is costly—both in time and money—and, by the end, may be more trouble than it’s worth. Even if benchmarking your property’s kWh usage is the point, usage rates and costs fluctuate throughout the year, so the accuracy you locate at one moment will inevitably vary from season to season.

“In one instance, we installed a series of TOU meters across all distribution boards that controlled the mechanical plant to work out the ‘actual’ energy usage. This worked but was complicated, and I wouldn’t recommend it.”
Stuart Bryant, GM

“I’ve found that a simple system (agreed with the tenant up front in the lease) works best,” Bryant states. His point is notable: simplicity can be preferable to accuracy, especially when tenants are involved. Simple calculation methods are much easier to get tenant buy-in from the get go. Complexity often breeds skepticism, as tenants fear hidden costs lurk within convoluted processes.

Pro Tip: Schedule an energy audit. Whether it’s for a NABERS assessment or simply to save on energy bills, an energy audit gets the hourly data you need to calculate your fixed energy costs. Plus, it increases your sustainability.

Should You Include Depreciation?

Including accelerated depreciation will likely depend on the complexity of your HVAC system and budget. After-hours AC requests do shorten the lifespan of your equipment, so if you decide to recoup that cost, make sure it’s worth your time. One way to manually calculate depreciation is to research ASHRAE reported estimates for each piece of HVAC system, but this is complex and time consuming.

FM’s with access to asset management systems can speed up the process. Some AMS software use built-in ASHRAE reports to predict equipment life cycles. These programs can serve as a helpful guide for adding hourly depreciation to your AHAC if you have access to them.

Still, other FMs are using experts to fill in the depreciation data gaps. Bryant explained that his company solicited incumbent engineers to gather data for calculating depreciation. He notes, “Having the independent data and showing the workings meant a simple explanation to tenants when they’d questioned costs.”

Bryant’s quote highlights a critical piece of the AHAC puzzle: third-party validation. Soliciting experts is expensive, but it also adds independence and credibility to the data you collect. For some managers, ensuring a calculation that reassures tenants is worth the upfront investment. For others, it may be an unnecessary cost.

Aim for Fairness, But Be Practical

With AHAC, the notion of tenant fairness will inevitably creep into your calculation. While buildings with only one HVAC zone make figuring AHAC costs fairly straightforward, multi-storied buildings introduce complexity. Consider these two situations:

Situation #1: Tenant A is a data center and Tenant B is a law firm. Tenant A uses five times the electricity as Tenant B.
Situation #2: A building has two HVAC zones: Zone 1 is bigger and requires $50/kWh to cool. Zone 2 is smaller and only requires $30/kWh.

For Situation #1: How do you plan for this discrepancy in power usage? Is it fair to charge both tenants the same rate for after-hours AC? For Situation #2: If you opt to go with the $50/hr charge for your AHAC rate for all tenants, aren’t tenants in Zone 2 getting ripped off?

These are fair questions to consider, and there are practical ways to provide for exceptions. For example, FMs with a multi-tenant building could average their electricity costs across HVAC zones:

Floor 1 – 3 = $22/hr
Floor 4 – 8 = $36/hr
Floor 9 – 12 = $30/hr
Average = $29.33/hr

Averaging in this way spreads the cost more equitably among tenants, but the process assumes that energy data per zone is easy to come by. Plus, most FMs want only one AHAC rate for all tenants because it keeps leases consistent and billing easier. So, while you should strive for fairness, stay practical in your expectations.

Bryant says shifting your perspective on after-hours AC is beneficial here. He suggests thinking of it as a one time “cost of service” rather than a pro rata charge. “Again, I think simplicity is the best policy here,” he states. “The basic calculation that tenants have agreed to pay when using AHAC is most important. It doesn’t matter if one or multiple tenants are using it at the same time because it’s really a cost of the service you’re providing for each.”

Keep Sustainability a Priority

If you’re not on top of them, after-hours requests can tank your sustainability efforts. Without an effective booking system, cancellations and reschedules may have you heating or cooling empty spaces. Make sure you’re automating as much of the process as possible. Consider investing in technology to help, like an AHAC automation app that lets tenants order after-hours AC from their smartphones. Automation helps you conserve time, money and energy.

Plus, look for opportunities to work with individual tenants to save energy during their requested hours. Bryant suggests starting with tenants who make regular requests. “Talk with the tenant or landlord about ways to minimize their electricity usage during this time. Consider adjusting your BMS for better control of temperatures. It will limit the usage of your main plant and reduce electricity and/or gas consumption.”

Conclusion

Tenant satisfaction is a key “cost” of sloppy after-hours AC calculation. Overly complex processes, infrequent communication, and billing inconsistencies lower tenant satisfaction and occupancy rates. Tenants unfamiliar with AHAC may question the need for a separate billing at all. Others may be confused by the idea of delivering a utility-as-a-service. A few may even dispute your fixed energy rate. Many tenants simply forget the AHAC agreement exists, leading to angry emails about mystery electric bills.

These situations are why setting expectations with tenants is so valuable. “Agree to the cost and workings of the plan up front with the tenant,” Bryant advises. “Spend the time early to avoid spending time each month discussing and explaining costs and charges.”