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Quality Management Investments for Energy Efficiency

Periodic Reporting for period 1 - QUEST (Quality Management Investments for Energy Efficiency)

Reporting period: 2019-06-01 to 2020-11-30

The main goal of QUEST is to increase investments in Sustainability and Energy Efficiency by providing an easy-to-follow methodology for evaluating the risks associated with these investments. The risks attributed by investors to Energy Efficiency projects mainly stem from insecurity around the energy and cost savings, since predicted energy savings are unfortunately very often much higher than the actual savings achieved. This issue is putting the loans at risk since the building owners might not be able to pay them back because they have higher energy costs than expected, thus jeopardizing the return-on-invest calculation.
This “performance gap” is particularly important for society and the European Union since we are planning to heavily invest in a greener building stock within the renovation wave as defined by the European Commission.
Within QUEST this issue is being tackled by identifying and empirically risk-grading factors that influence energy performance of buildings. Leveraging existing data and QUEST-led stakeholder workshops, we are creating an Energy Efficiency risk appraisal method to de-risk investment decisions through the integration of effective quality management services into Energy Efficiency projects, and we will proactively communicate this methodology to investors for their knowledge and capacity-building through national promotion teams which will also include institutional investors such as pension funds. Financial institutions applying the QUEST method will be more comfortable increasing their portfolio of Sustainable projects and will be able to significantly increase Energy Efficiency investments.
QUEST will create and popularize a data-driven decision-making process, certifiable to ISO EN 17065 standards. The QUEST process will help financial institutions to improve risk premium calculations reliability. The core element will be a “Quality Management Impact” factor (QMI factor) that represents the added value of quality management within project design, construction and operation. The process will allow users predict the impact of quality management services like certification schemes (BREEAM, DGNB, LEED etc.), building commissioning (LEED, COPILOT, ICP etc.), Monitoring (AMEV, LEED etc.) and continuously improve the empiric evidence.
Within the first 18 month of the project, the consortium has carried out a comprehensive literature review on building performance, performance gaps and quality management services including interviews with stakeholders. Building on this foundation, QUEST started to develop a two-fold methodology:

• QUEST drafted an online-tool that allows the approximation of cost and added value of quality management services for any given building project. Due to the minimal information required for the estimation, the tool can be used in early stages of real estate development to have budgets for quality management services properly allocated.
• QUEST also drafted a methodology to evaluate the added value of quality management services using pre- and post-project evaluations. These cover basic panel data (like size, occupancy rate, operational expenditures etc.), questions on the perceived technical and financial performance of a project as well as technical testing of systems.

Both approaches combined shall be used to continuously evaluate the success of projects including data on the added value of quality management services for buildings.
Within the last months, QUEST has gathered a series of pilot projects that will used to serve as demonstrators and test beds for the methodology. Although initially limited to commercial buildings, especially office buildings, QUEST extended the scope of the methodology to residential buildings as a reaction to the tremendous demand, pending investments and stakeholder requests.
Applying the QUEST methodology, it will be possible for the first time for investors to calculate the added value of quality management services for their projects based on empiric data and to include corresponding budgets in their projects financial planning. This will help to de-risk projects by reducing the technical performance gap that ultimately harms the financial performance of projects. Due to the proven cost-effectiveness of quality management services like Technical Monitoring and Commissioning, this will most likely improve both the economic as well as the ecologic performance of buildings.

QUEST complements the EU’s Green Deal. We hope to advance the state of the art by cross-fertilising QUEST work with EU Taxonomy requirements to generate tools for users to verify their EU Taxonomy-compliant sustainability score.

QUEST intends to present first results in 2021 to stakeholders to further improve the methodology and tools and to disseminate QUEST as a valuable service for building projects in Europe. QUEST is already teaming up with partners from the building industry to apply the methodology and tools and to de-risk their investments in a sustainable European building stock.
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