Work

Determining Energy Use Volatility for Commercial Mortgage Valuation

Year: 2012

Type: report

Abstract: Commercial mortgage contracts currently do not fully account for the risks inherent in the level and volatility of energy use in commercial buildings. As a result, energy efficiency is not explicitly included in the valuation process for commercial mortgage underwriting. In particular, there is limited if any consideration of the volatility of energy use and price, which is critical to evaluate the impact of extreme events and default risk. Explicit inclusion of energy use and volatility in commercial mortgage underwriting can send a strong “price signal” that financially rewards and values energy efficiency in commercial properties. This report presents the results of a technical analysis of and a proposed protocol to assess energy use volatility for the purposes of commercial mortgage valuation.

Source: OSTI OAI (U.S. Department of Energy Office of Scientific and Technical Information)

DOI: 10.2172/1173155

Authors: Lawrence Berkeley National Lab. (LBNL), Berkeley, CA (United States), Paul Mathew, USDOE Office of Science (SC), XiuFeng Pang, Liping Wang

Institution: Lawrence Berkeley National Laboratory

Language: English

Topic: Housing Market and Economics

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDGs: Affordable and clean energy, Climate action

Open Access status: green

Funders: U.S. Department of Energy, Building Technologies Program