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Tourists at the JW Marriott Marco Island Beach Resort on Marco Island, Florida. Photo: Creative Touch Imaging Ltd./NurPhoto via Getty Images

Commercial and residential buildings account for 39% of carbon emissions in the U.S., making them a critical site for reducing the country’s energy consumption and tackling climate change. One way to reduce their carbon footprint is the subscription model, also known as “as-a-service,” whereby a central entity owns and upgrades equipment for customers.

How it works: Subscription companies purchase, install and maintain energy-efficient technologies such as HVAC and LED lighting in a customer’s building. The customer saves money on the expense of purchasing and maintaining the equipment over the long term and, because the equipment is energy efficient, on their utility bill.

Where it stands: The subscription energy industry is still nascent. But according to an August 2018 Bloomberg New Energy Finance report, as-a-service agreements are “emerging as the most suitable framework for delivering” energy infrastructure, with several companies seeing early success.

The subscription model is gaining traction because it addresses the key barriers to adoption of more efficient energy technology — namely, spending time and capital upfront on equipment that doesn’t fuel a company's core business.

Some U.S.-based examples:

  • Saint-Gobain used SmartWatt to upgrade its lighting to LEDs, which use less energy and reduced the company’s lighting electric costs by 92%.
  • Sparkfund installed smart thermostats in Marriott-owned hotels, which reduced their carbon emissions by roughly a million pounds per year and saved them $172 per room per year in reduced HVAC runtime.

Yes, but: As this emerging model matures, it’s still unclear which technologies will be compatible, which building and customer types subscription will best serve, and which companies will provide the underlying components necessary to serve this market.

What’s next: Subscription offerings as a category are growing rapidly, from $57 million in revenue in 2011 to $2.6 billion in 2016, according to Navigant. This growth will only continue as utilities continue to invest in and partner with subscription companies and other startups in an effort to combat climate change on a larger scale.

Brandon Hurlbut is the co-founder of Boundary Stone Partners and former chief of staff at the U.S. Department of Energy.  He is a member of Sparkfund's board of directors.

Go deeper

Federal court blocks Biden's vaccine mandate for health workers in 10 states

President Biden delivers remarks on the Omicron COVID-19 variant following a meeting with his COVID-19 response team. Photo: Anna Moneymaker via Getty Images

A federal court in Missouri has blocked the Biden administration from enforcing a coronavirus vaccine mandate for health care workers at federally-funded facilities in 10 states.

Why it matters: Monday's decision is the first victory for opponents of the rule, which requires health care workers to get vaccinated by Jan. 4, 2022. The case is one of four lawsuits challenging the Centers for Medicare & Medicaid Services' (CMS) rule and argues that the mandate will exacerbate staffing shortages.

Twitter's next act

Illustration: Annelise Capossela/Axios

Twitter co-founder and CEO Jack Dorsey is exiting the company he helped build at a time when its future has never been so uncertain.

Why it matters: The person who controls Twitter controls the de facto public square — with implications for politics, media and free speech.

40 mins ago - Health

CDC strengthens COVID booster recommendation

Rochelle Walensky. Photo: Chip Somodevilla/Getty Images

The Centers for Disease Control and Prevention (CDC) on Monday strengthened its previous recommendation for booster shots, saying that everyone 18 and older "should" receive a booster dose.

Why it matters: Last month, CDC director Rochelle Walensky accepted a key advisory committee's recommendation that adults "may" get the shot. The slight, but strengthened, change in wording comes amid the emergence of the Omicron coronavirus variant.