Editor’s note: FM Perspectives are industry op-eds. The views expressed are the authors’ and do not necessarily reflect those of Facilities Management Advisor.
The residential and commercial building sector is the leading energy consumer in the U.S. economy, accounting for approximately 40% of the nation’s entire energy consumption and 35% of U.S. carbon emissions. What’s worse? The Environmental Protection Agency and Department of Energy have found 30% of building energy consumption is simply going unused due to poor management—resulting in $150 billion in energy waste costs annually.
While efforts to curtail building energy usage have been slowly entering the market over the past few years, the industry is experiencing an entirely new high-stakes energy landscape in 2026 that is shifting the use of smarter, more efficient energy management systems from a nice-to-have to a critical business function.
Geopolitical conflict, increasing demand, a rise in climate-driven disasters, and stricter local emissions regulations are driving a widespread, urgent pivot towards artificial intelligence (AI) solutions for operational resilience and compliance.
The Shift from Reactive to Predictive
Historically, building energy management was conducted under a “break-fix” model. An operations manager would do their daily rounds of maintenance checks and if they saw any sort of visual warning signs, then a problem would be resolved. If a tenant complained their unit was too hot, or a facilities manager noticed a spike in a utility bill, only then would a technician be called in to fix the boiler.
And in some cases, it’s been found boilers will overheat a space and occupants find it easier to open their windows than to notify a building manager. This leads to excessive overheating and a manager that is blind to how much energy is actually being wasted in their building.
This reactive approach is proving obsolete, resulting in higher costs for both tenants and owners, in addition to high carbon emissions numbers. Today’s building owners are now noticing these flaws in their systems, and are pivoting to solutions that utilize AI to provide a predictive maintenance system instead.
Going Remote with AI
Smart, AI-powered energy management platforms are emerging to optimize building heating remotely, cutting energy usage by up to 40%. Using machine learning, AI platforms learn a building’s heating patterns and automatically change settings to adapt to new conditions to optimize boiler staging and cycling. This technology also monitors for issues in real time, such as water leakage or heat loss, and provides quick, actionable alerts to limit waste and protect older infrastructure.
All of these functions work together under one AI platform that can be managed off-site from the building it’s monitoring. This level of automation not only improves operational flexibility, but reduces the need for extra labor and on-site visits. However, while these platforms exist and are readily available, many building owners are unaware that this technology can be seamlessly integrated into their current legacy systems.
Avoiding New Infrastructure
Most multifamily and commercial buildings are operating legacy energy management systems that were installed 20-40 years ago. Replacement costs for an aging boiler system can cost more than $500,000 per building, with large complex owners seeing price tags of $50 million in places like New York City.
However, investment in new equipment that still operates from a reactive approach is only going to cost building owners thousands, if not millions, of dollars. Retrofitting existing equipment with advanced technology that optimizes current assets may be one of the best ways to save costs, improve operational resilience, and lower emissions to meet today’s standards.
For modern building owners, ignoring the opportunities that AI unlocks for energy management is no longer just an oversight—it’s a financial and operational liability. As the market continues to shift into a more competitive, volatile landscape, building owners who pursue advanced solutions are the ones who will come out on top.
Ari Shultz is vice president of energy management solution provider Entech.