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Energy Efficiency & Star Rating Systems in Buildings

As the famous management saying goes, what cannot be measured cannot be managed. This is very true even in the management of energy and the associated costs that go with the energy usage in a building. As everybody knows, more than 40 per cent of the energy goes into running of the HVAC systems in a building. Thus, it makes business sense for the building owner or occupier to manage these costs as much as possible to keep the overall operating costs low. In addition, there are many other energy consumers in a building such as lighting, elevator loads etc. that also contribute to the overall building load.

While there are several ways to assess efficiency of a component or system in a building such as the IKW approach for chiller efficiency, the overall building efficiency is a more relevant measurement to undertake as it allows the owners to get an overview of the building’s performance and corrective measures can be taken in an integrated manner. Thus, several building rating systems have come up over the last 2 – 3 decades in the western markets and in about 8 – 10 years in the Indian scenario. This article lists the various certification systems focused on energy efficiency and their penetration in the Indian market.

Building rating systems overview: Internationally, there are many building rating systems in vogue and mostly each of the developed markets having their own rating systems for building efficiency. The US uses the LEED (Leadership in Energy Efficiency Design) rating system developed by the US Green Building council (USGBC), The BREEM (Building Research Establishment Environmental Assessment Method) rating is widely used in UK or Europe and in Australia, the NABERS (National Australian Built Environment Rating System) is used. In India, there are several energy and building rating systems in use which have been developed by Indian rating agencies or have been modified by the international agencies for use in Indian conditions. Figure 1 shows the various ratings systems commonly in use in India.

There are two types of rating systems – one approach is to rate the overall design and performance of the building, covering various aspects such as energy, air quality, transportation, sustainability etc. The other is a more energy usage focused approach which assesses the building’s energy use. Both approaches have their advantages and disadvantages and hence should be adopted after careful consideration of what is the end objective of the owner who is taking the path to certification.

Figure 1: Building Rating Systems

Whole Building Rating Systems

These rating systems are the most common in the current Indian building environment. Most of these rating systems have both design-based ratings as well as ratings that measure a building once it is operational. The whole building rating approach covers various aspects of the building including design elements that impact energy use, sustainability aspects, human comfort etc. The various rating systems in use in in India are as below:

  • IGBC Green Ratings: This is one of the most common rating systems in the Indian market as it has been designed for the local conditions. Set up as a joint initiative of CII and Godrej in 2001, the Indian Green Building Council (IGBC) has evolved into a powerhouse of the green movement in India and there are now many ratings that the council offers. The IGBC Green Existing Building O&M rating is used by building owners to assess how their asset is performing on energy, water, facility management, health and innovation and the ratings are given as ‘certified’, ‘Silver’, ‘Gold’, and ‘Platinum’. The assessment is based on operational data for the last one year and the pre-requisite for certification is 80 per cent occupancy and more than 1 year of operations. The certification is valid for 3 years.
  • LEED Certifications: The US based USGBC introduced LEED in India in the mid-nineties and set the agenda for the building performance measurement. Over the period, the LEED standard has been customised for the Indian standards and is still considered as a valuable certification to be achieved for Grade A building owners and occupiers. The existing building standard focuses on the performance of the building post commissioning and rates the building on sustainability, energy efficiency, water efficiency, air quality, materials and innovation.
  • GRIHA: This standard was developed by TERI (The Energy Research Institute) in 2007 and is India’s national rating system adopted by the government (Ministry of New and Renewable Energy) as well. The rating system has been developed for the Indian environment and is a much simpler rating tool than the other standards. A GRIHA rating system uses a ‘Star’ rating approach, with building rated from 1-Star to 5-Star. The existing GRIHA rating system assesses the building on site parameters (Impact of building on the surrounding), maintenance, energy, water, human comfort and social aspects (accessibility etc.). Since this is a national standard adopted by the government, there are various incentives that are given to buildings that get certified. Many state governments give additional FAR for achieving this standard and many banks also give loans at concessional rates for GRIHA certified projects.
  • GEM: This is a new standard that has been developed by ASSOCHAM (in 2017. The GEM (Green & Eco friendly) standard is relatively new in the market and follows a more detailed approach with 27 measurement areas.

Energy Efficiency Based Ratings

While the whole building, integrated approach covers many building O&M aspects, the focus is distributed. In the developed markets, building energy usage specific ratings are used to monitor the performance of this key component of building operations as well as cost baseline. The Energy Star program in the US run by the EPA (Environment Protection Agency) rates buildings of various classes and size based on national scientifically developed benchmarks. The Indian standard that uses energy use as the base is the BEE Star rating standard.

  • BEE Star Rating for Office Buildings: This standard was developed in 2009 by the Bureau of Energy Efficiency (BEE). The standard assesses the actual energy performance of the building based on the energy bills for the last three years and the buildings are categoried as per the 4 climatic zones that India has been divided. The rating is on a 1 to 5 star basis, with 5 stars being the highest and representing the most energy efficient building operations. The performance is calculated by arriving at the EPI (Energy Performance Index) which is the amount of energy consumed per sqm per year in the building. This rating system allowis building owners to know how their building is performing on the energy usage front.

Which System to Use?

With many energy performance rating systems available to the asset owners, there is always a dilemma on which is the best option. While there is never an easy answer to this question, the building owners could ask themselves what the reason is for their taking the certification and then work out the best option. Certifications cost money and that can be a deciding factor as well. Having an existing building certification can help the owner get higher rentals as well as lower operating costs for the tenants. In addition, the rating shows to the community that the asset owner is a concerned citizen. If improving energy efficiency is the key driver, especially for older buildings, then an EPI based approach will be beneficial.  Thus, a building owner will have to assess the key reasons for going in for the certification.


Benchmarking one’s asset or building is the first step to understand how the building is performing and this can form the basis for improving the building performance. Energy being a major cost contributor to a buildings operating budget, it is imperative that the energy us used effectively. In addition to the cost, there is the impact to the environment that one should keep in mind, and thus, going for a building certification will help minimize the impact on the surroundings as well as the overall climate. There is thus a strong case for building owners to take energy efficiency certifications for their buildings.