HOW TO CALCULATE AND PRESENT DEEP RETROFIT VALUE

This guide by the Rocky Mountain Institute (RMI) provides real estate investors with a framework to calculate and present the full value of deep energy retrofits. It argues that conventional evaluations, which focus primarily on energy cost savings, often overlook significant revenue and risk-reduction benefits that can make a project financially viable even if its net present value based on energy savings alone is negative.

• Deep energy retrofits are defined as integrated energy efficiency measures, often implemented via portfolio-level or multi-year plans, that reduce energy consumption by 30 percent or more relative to pre-retrofit levels while improving sustainability performance, occupant health, and satisfaction.
• Conventional evaluations of building retrofits often fail because they focus too narrowly on energy cost savings. A comprehensive Deep Retrofit Value (DRV) approach considers additional factors that can turn a project with a negative net present value into a lucrative investment.
• The guide identifies five core elements for calculating deep retrofit value: initial retrofit development costs; non-energy operating costs (such as maintenance, insurance, and occupant churn); retrofit risk analysis to mitigate and price risks; tenant-based revenues (including higher rents, occupancy, and retention); and sales revenues (driven by higher net operating income and increased investor demand).

APA

RMI (2015). HOW TO CALCULATE AND PRESENT DEEP RETROFIT VALUE. https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_2015-08_RMI-DRVReportHiRes.pdf

Chicago

RMI. HOW TO CALCULATE AND PRESENT DEEP RETROFIT VALUE. 2015. https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_2015-08_RMI-DRVReportHiRes.pdf.

Wikipedia

{{cite report |author=RMI |title=HOW TO CALCULATE AND PRESENT DEEP RETROFIT VALUE |date=April 2015 |url=https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_2015-08_RMI-DRVReportHiRes.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2015how, author = {{RMI}}, title = {{HOW TO CALCULATE AND PRESENT DEEP RETROFIT VALUE}}, institution = {RMI}, year = {2015}, month = apr, url = {https://rmi.org/app/uploads/2017/05/RMI_Document_Repository_Public-Reprts_2015-08_RMI-DRVReportHiRes.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }