Why Optimizing Office Occupancy is Key to Achieving Cost Efficiency and Sustainability

Over the last two years, rising energy prices have been a cause of concern worldwide, especially in Europe, with the post-pandemic economic recovery, supply chain constraints, the Russia-Ukraine war and rising tensions in the Middle East affecting both supply and demand of energy.

As countries try to protect themselves from supply disruptions and high commodity price fluctuations, such as those associated with natural gas in Europe at the onset of the Russia-Ukraine war in 2022, new forms of legislation and incentives have been crafted to increase energy efficiency for businesses and individual consumers, and to shift away from fossil fuels to boost energy independence and the transition to a greener economy.

Achieving Sustainability & Meeting Demand for High-Quality Buildings Within Fixed Budgets

Following the legislation to drive sustainability commitments as the result of The Paris Agreement (COP21), especially in terms of decarbonization and the path towards limiting global warmth, companies are making their own sustainability pledges that require alignment with local and international laws, and commitment from their entire value chain.

The sustainability drive will make companies chase their low carbon goals while meeting their employees´ rising expectations. At the same time, companies need to comply with stricter regulations in terms of emissions and financial reporting. All these factors will lead companies to increasingly seek environmental performance indicators, such as energy intensity and electrification, on top of green credentials.

The costs of the transition will continue to rise as the increased demand for higher quality buildings in key cities will lead to higher prices, with supply not keeping up with demand (both for new buildings and refurbishments).

At the same time, building higher-quality buildings or retrofitting the existing ones is inherently more expensive than using lower quality buildings. Though not immediately, regulations will impact all buildings both directly with building performance standards and indirectly through corporate disclosure mandates.

The flipside of costs is that more efficient buildings will help companies reduce energy and heating costs while proving beneficial when evaluating insurance costs, given the lower associated risks of these properties.

Balancing Cost-Efficiency & Sustainability by Optimizing Office Occupancy

2022 saw a surge in the number of offices reopening. But many companies realized they needed less office space, with some sectors experiencing resistance from employees to work in person.

In the first half of 2023, North America recorded the highest weekly average peak occupancy rate at 35%, with APAC following closely at 34% and Europe at 33%¹.

Regional trends exhibit notable variances, suggesting influences from factors such as commute time, public transport availability, and employee job roles on office space utilization.

Rising energy costs and growing demand for sustainability are compelling businesses to reconsider their office occupancy needs. This has prompted them to take a closer look at key strategies and technological advancements tailored to optimize occupancy, curtail energy expenses, and uphold eco-conscious practices within workplace environments.

How Businesses Can Determine Optimum Occupancy

• Monitor Occupancy Data

Implement sensors or occupancy tracking systems to gauge real-time utilization. This data helps optimize space usage and energy consumption accordingly. This can help in the short term by identifying underutilized areas and reassigning them for better use, and in the longer term to make informed decisions about future space needs.

• Promote Flexible Work Arrangement

Encourage remote work or flexible schedules to reduce the number of employees in the office at a given time, thereby cutting down on energy usage. Offices can utilize spaces more efficiently by implementing hot-desking policies where employees share desks or workspaces.

• Conduct Space Utilization Analysis

Evaluate the office layout and how individuals use various types of spaces (including preferred work spots and mobility habits) to optimize space allocation. Redesign spaces based on actual usage patterns to optimize layouts for better efficiency.

• Use Energy-Efficient Infrastructure

Invest in energy-efficient appliances, LED lighting, and smart HVAC systems to lower overall energy consumption during occupied hours.

• Drive Employee Awareness and Engagement

Educate employees on energy-saving practices and encourage their involvement in sustainability initiatives within the office.

Technologies to Support You:
 

• Occupancy Sensors and IoT Devices

Utilize sensors and Internet of Things devices to monitor and control lighting, temperature, and other utilities based on real-time occupancy data.

• Building Management Systems (BMS)

Implement BMS for centralized control and optimization of energy usage across the office, enabling remote monitoring and adjustments.

• Smart Lighting and HVAC Systems

Install smart lighting and HVAC systems that automatically adjust based on occupancy, time of day, and environmental conditions to conserve energy.

• Data Analytics and AI

Use data analytics and AI-driven solutions to predict occupancy trends and optimize energy consumption, aiding in proactive decision-making.

Also Read: How IOT Tools Ensures Cost and Energy Savings in HVAC Systems

A fusion of the listed strategies with cutting-edge technology can cultivate cost-efficient workplaces while championing sustainability. This dynamic integration has the potential to propel offices toward a resilient future, fostering environments that harmonize financial mindfulness alongside environmental stewardship.

For more insights, read the 2024 GEP Spend Category Outlook now.