Vineet Kashyap

About Carrier’s Healthy Buildings Program, how is the company convincing building owners and asset managers of large commercial facilities to adopt healthy building measures? Where is the budget coming for indoor air quality-related expenses? What metrics and ROI is Carrier able to offer that would persuade building owners to invest in IAQ-related design measures and equipment? The context of my question is the COGfx study by Dr Joe Allen of the T H Chan School of Public Health at Harvard, in which he has attempted to quantify the benefits of IAQ.

When we talk about our Healthy Buildings Program, let’s first understand what constitutes the cost of a building. It is the cost of construction and the cost of running and maintaining it and the energy requirement. The real cost of a building, though, is of the occupants and for them to be able to perform what they want to in that building.

There are various types of buildings. And you have residences that occupants either own or are paying the rent for. In residences, that equation becomes easier. I can put a value to my wellbeing. If I want to invest in a filter, I would, because it impacts me. In a commercial establishment, if a company owns the building, that becomes easier.

You refer to Dr Joe Allen. According to the study, in healthy buildings, the spending is USD 14 – USD 40 per user, whereas the benefit per person is USD 65,000. So, it is non-comparative, if you are putting USD 40 per person and getting USD 65,000 in benefits per person.

If the owner is separate, and the tenant is a different party, the owner typically is not concerned about the welfare of the tenant, but that view is changing. When you have a higher supply in the market, that equation changes rather rapidly. If you are the owner of a healthy building and if you can demonstrate that through LEED certification or the WELL rating, you can command a premium and tell tenants that when the market is going up. It is a good story even if the market is coming down. Would I go to a building that is healthier or unhealthier even when prices are crashing?

While in the midst of the pandemic, there is heightened awareness of indoor air quality. Would we be able to sustain the momentum once the danger of contracting the virus dissipates?

I can answer that in three ways. First, let’s benchmark what’s been happening in countries where IAQ became an issue a decade or two ago. if you historically look at things as they were a few decades ago, IAQ was a problem in cities like London, which had outdoor air quality issues. They worked on that, and now, it has become part of life for them. In China, even till 5-6 years ago, there was a problem, but if you think how people have coped with it and how they moved away from boilers to heat pumps, which is more expensive, you have your answer. In China, people have an app for air quality, and technologies around air filters and air purifiers are dominant; and Carrier has been proactive in the Chinese market. So, history teaches us that humankind needs a kind of jolt to wake up to things, and in some cases that jolt happened in terms of outdoor air quality, and it impacted IAQ.

In countries where you get nice fresh filtered water, you take it for granted, and it has become a part of your life, and that is the same with IAQ. And so, even after the pandemic, people will take IAQ seriously. The technologies are there, and you don’t need to reinvent them. And so, we have various MERV filters, HEPA filters for particulate matter and electrostatic filters for airborne pathogens. We have Carrier’s OptiClean Negative Air Machine, which cleans contaminated air and creates negative pressure to prevent air from spreading to different sections of a building. If negative pressure is not required, the machine can be used as an air “scrubber” to pull air in, remove contaminants and discharge cleaner air back into the room. We have sold 1,000s of units of the OptiClean to schools in the United States in the past few months. Parents and thinking, ‘Are my kids going to be safe?’ Parents – and people, in general – are becoming conscious.

As Carrier, we offer IAQ assessment. Before you start off your building, our team will conduct air-side balancing, water-side balancing and a ventilation check for mould and VOCs. And they do re-commissioning and provide filters to keep buildings safe. If you want continuous assessment, there is a whole bunch of technologies available. History has shown that energy-efficient equipment has become cheaper. The gap between LEED Platinum and other buildings was 25%; now, that gaps has reduced significantly. We have EcoEnergy Insights, which is a fantastic company within the Carrier system. What EcoEnergy does is they are experts in machine learning and artificial intelligence in buildings. These guys are not engineers but data scientists. They plot data from buildings and form predictive patterns. And based on past trends, they can tell what is going to happen in the future. So, with minimal investment, they can do remote monitoring of buildings and air-side assessment. So, owners of different types of buildings can get used to IAQ and the solutions on offer.

Could we have your thoughts on the importance of continuous commissioning and ASHRAE’s Guideline Zero. How best can a manufacturer of HVAC equipment participate in a multi-stakeholder collaboration in New Construction and in Existing Building retrofit projects to ensure energy efficiency and IAQ are properly incorporated, with a view to serving the building well throughout its lifecycle?

I will take it in two parts. There is the whole construction of a building and how building solutions get involved, and then there is the part of running the building. In the first part, we are seeing change in how building owners are doing design charade, and how building owners are involving architectural and MEP consultants. And in some cases, MEP consultants are involving technological solutions, and they are saying, ‘This building is going to come up in three years, and what technology do you have coming?’ The Building Solutions Group in Carrier is a key entity. We typically have HVAC, fire safety, security and building automation in buildings, and the Building Solutions Group works across all these. Somebody might be an expert in hotels or data centres, and they work on active design components of buildings that can impact the performance of buildings, and you can modify them even at a later stage.

When it comes to operating the buildings, we go about it in two ways. At the time of commissioning an equipment, we work with operators, and that training lasts for a fairly long time. Typically, when an alarm goes off, you don’t press the manual override button – you try to sort it out. If the operators change and new people come in, how do you make sure the building is being managed? And so, that’s where we do remote monitoring, and the Building Solutions Group is good at that. With existing sensors, you can get data and do predictions 24×7. They are adding value – EcoEnergy and the Building Solutions Group. If you have two chillers in a building and the operator is running one at full load and the other at 25% load, our experts in command center review this as an inefficient operation and, based on the historical data analytics on similar configurations around the globe with the help of AI machine learning process, the system either automatically configures the plant to run the chillers at the most optimised efficiency point or releases an actionable strategy for operator implementation. As an example, in this case, it may be more efficient to run both chillers at 62.5% load, and you save money. And it’s such ideas that come out, and the software does all these. It compares with what the building was supposed to do and tries to achieve that in the building. It can monitor CO₂ level and PM concentration in the building and advice to change the filter or alert the operator as and when the fresh air inlet is not working properly.

What solutions does Carrier have in mind for New Construction projects with the aim of safeguarding occupants from future pandemics, if and when they occur? What is the company’s R&D doing in this regard? What percentage of its annual revenue does it allocate for R&D?

I can say that the R&D budget is a very good number in terms of the percentage of revenue. Our CEO, while speaking to investors at the end of Q2 this year, said we are performing better than expected in terms of profitability and all the savings we are getting. We had a roadmap of negotiating with suppliers on rent and material costs, and we got some savings. We had some target for these savings. And considering how things deteriorated in March and April, we are doing better than the targets we set then. Our CEO said we were aiming for USD 225 million in savings. We eventually achieved USD 250 million in savings. Of the estimated 225 million, we had decided to set aside USD 75 million for R&D. As it turned out, we managed to set aside USD 100 million. That shows that the company is very committed to investing in the future.

In terms of what we are doing for the longer term, there are multiple streams of thought on the buildings of the future. The different solutions I spoke of earlier are focused on what the future will hold and the trends. Secondly, working with Harvard, you get insights into where the market is evolving and where the stakeholders are going. What it boils down to is that we have a current set of technologies, like UVC or ionisation that can reduce 99% of the organisms; and if you use advanced filters, you can take that figure to 99.99%. So, the question is, ‘How do you develop the next set of technologies that can take it to 100%.’ Another question is, ‘How can you give more fresh air changes without affecting energy use.’ So, energy efficiency, IAQ and the materials we use should be sustainable.