Monthly Archives: May 2018

Incentives For Lighting Upgrades Are Flickering

There’s no doubt about it. LED lights are now accepted as a way to reduce electricity for all types of buildings. They use much less electricity than historic bulbs and their prices have come down. Bloomberg estimated that nearly 500 million were installed nationwide in 2016. With this recognition, many utilities and government agencies are wondering whether it is time to gradually end incentive programs for LED lights.

But there are some strong arguments to keep incentives to encourage companies and the public to purchase LEDs. Despite their advantages, they have not totally won over the market. According to the National Electrical Manufacturers Association, LED lamps accounted for 36% of national light bulb sales in the 4th quarter of 2017, while halogen lamps still held 48% of market share. LEDs are displacing CFLs.
Also, the 36% market share is not consistent across the US, but is greatest in states or areas that either have strong financial incentives or high electric rates, from as high as 50% of the market in California to about 12% in Kentucky, according to the USEPA.

Some statistics in New York and Massachusetts, whose utilities have begun to reduce incentives, show that conversions to LEDs have also slowed down. Although switching to LEDs is strongly financially beneficial, consumers and companies have an expectation to get a further financial reward from the utility or government.

The belief is that when the new federal DOE standards come into effect on January 1, 2020 making it illegal to sell most halogen and incandescent light bulbs (less efficient than 45 lumens per watt), LED sales will increase. However, such sales may not soar because retailers will still be allowed to sell its non-complying products in the store past the compliance date and enforcement is unknown. The burden is not on the manufacturer or consumer, but on the retailer to stop selling non-compliant lights. How DOE will enforce these measures in many type of retail stores is unknown.

Utilities are realizing that targeted incentive programs may be best to encourage LED sales in the long term. Some utilities are beginning to focus on underserved markets to promote LED lights, such as rural and low-income urban areas. Programs may also be effective if they target the elderly market who have been slower to adopt to LEDs.

Some consumers have shied away from LEDs thinking they are limited in terms of beauty and utility. Focusing incentives to encourage people to buy decorative and reflector lights can improve this market and convert very energy inefficient lamps of these types to more efficient ones.

Finally, comes the transition to more robust incentives for lighting controls, turning lights – even more efficient ones like LEDs – off altogether when a room is not in use. Utilities are beginning to incentivize effective dimming and occupancy controls that are easy to install and operate.

CCES has the experts to help you upgrade your lights to LEDs to maximize the energy cost savings and to improve your employee’s or customer’s productivity and comfort. We know the existing incentive programs and can maximize these to provide you the best performing project economically with the shortest payback and return on investment. Contact us today at 914-584-6720 or at karell@CCESworld.com.

Making Your Building Healthier: It’s Not A Gimmick; It Can Make You A Profit!

There has been a lot of stories on the news for decades now about the high cost of health care in the U.S., the brunt of insurance costs borne by companies and organizations. According to one publication, companies and employees now spend an average of $18,000 annually per employee for health costs, a 61% increase in 10 years. And this is likely to grow in the near future, an unsustainable path for business. And that is the direct monetary cost. Additional costs to business include missed work, distraction, bureaucracy, turnover. Ways that a building owner can upgrade its stock that demonstrably will improve the health of the renters’ employees can be shown to be a positive force for the tenant’s bottomline and put your property in great position in the rental market. Even if you move the costs of such upgrades into the tenant’s rent, it is likely to be smaller than the savings in that annual payment for health care.

Now, some of you may be skeptical, but a lot of research has been performed about this and there is no question that a “healthy” building does lead to fewer sick days and higher performance, something that businesses and tenants know are critical for survival. In addition, “healthy” buildings can be cost-effective and produce a strong ROI.

Is there a “magic” or simple formula that will make a building “healthy” and reduce such costs and sick days in a quantifiable? No – at least not right now. The USGBC has developed “WELL” standards which, when implemented, will raise the chances that workers will have fewer sick days, be more focused and productive, etc. WELL buildings are certified that the owner has implemented the most modern, tested strategies to optimize the health of those that use or live in the space. See: https://www.wellcertified.com/en/explore-standard

Consider implementing WELL standards in any new construction or renovation. Perhaps you may not want to go all the way to become certified at this time. But any upgrades you can install that can be shown to improve the health and well-being of the users will put you in a better position in terms of tenant retention or attracting higher level (and higher paying) tenants.

It is critical to recognize that this is not “cookie cutter”. You must begin by understanding each individual property. Is it in an urban, suburban or rural area? Are there other health issues around (contaminated sites or major polluters nearby)? Data is important. What has been the sick day history of previous tenants? Have there been certain patterns?

With this understanding, you can better focus your strategies to those more likely to be successful for more users, whether it be concerning water, air, infrastructure, light, etc.

CCES has the technical experts to help your building become “healthier” by developing the right specific strategies for your buildings and implementing them to the best effect – to increase the odds that users will be healthier, more focused, more productive, and satisfied. All factors to improve tenant retention and attraction and better for your long-term bottom line. Contact us today at 914-584-6720 or at karell@CCESworld.com.

The Value Of Modernizing Your Aging Buildings

According to the US Energy Information Administration, only 12% of existing commercial buildings have been built since 2003 and more than half were constructed before 1980. The median age of such buildings is around 32 years. https://www.eia.gov/consumption/commercial/reports/2012/buildstock/

Many cities and states in the US have developed goals to reduce greenhouse gas emissions, commonly by 80% from a 1990 baseline by 2050. New buildings that are certified as LEED are helpful in meeting these goals. However, the statistics above demonstrate that meeting this goal and also reducing energy usage and demand to more effectively manage the grid cannot be met unless existing buildings modernize. More utilities are developing incentives for existing buildings and municipalities laws or new codes to require existing buildings to be more energy efficient.

Incentives are a positive, but only help the bottom-line a little bit, and sometimes have strings attached. Laws are useful, but often result in building owners addressing the letter of the law and not doing all that can be helpful to be more energy efficient.

Building owners should look at modernizing their existing stock as an investment opportunity with many potential financial benefits for the following reasons:

1. Long-term, reliable energy and other cost savings. According to the Intergovernmental Panel on Climate Change (IPCC), energy savings of 50% to 75% can be achieved in commercial buildings that implement smart energy efficiency measures. Their biggest problem is aging building envelope, causing boilers and air conditioning units to work harder to develop the heat or cold lost to the aging envelope.

Since heating and cooling constitute the largest portion of energy consumption, most old buildings lose energy due to poor interiors and exteriors. Retrofitting older buildings can help with a significant reduction in energy needed to heat or cool the building.

Of course, upgrading lighting to LEDs is a sure-fire financial winner, with significant, reliable cost savings. When upgrading lighting, don’t forget to include lighting controls to keep lights off when the room is not occupied and daylighting to dim your light fixtures when sunlight is entering a room. Why pay for energy when natural light can help?

In addition, such modernizations and new technologies inevitably lead to cost savings in terms of O&M. Modern buildings with intelligent systems use 20% to 40% less energy and result in 8% to 9% lower operating expenses. https://c.ymcdn.com/sites/www.nibs.org/resource/resmgr/BSA/20140108_moa_jones.pdf

2. Meet sustainability goals. Many commercial buildings rent space to private firms that have written sustainability or climate change goals, including reductions in energy usage and/or greenhouse gas emissions. These companies develop multiple strategies to ensure meeting the goals. Working in a building that is energy efficient can keep a tenant happy or attract potential tenants which may have difficult goals to meet. Either way, an energy efficient building can put your building in greater demand (resulting in greater revenue) for your units.

3. Reliability in a world of growing energy use. More companies do more and more things to stay competitive, including, but not limited to bigger and greater data centers. It has been estimated that energy demand will rise 50% between now and 2050. Is your building able to reliably supply energy to tenants. Remember, risk may include serious incidents affecting business viability occur, which, of course, could lead to litigation. Therefore, not wasting energy and bringing in sufficient amounts for all situations is critical, and may require some modernization of the building and its wiring.

This includes automated controls, sensors, monitoring of energy use and feedback, “smart” technologies, and backup power. Being in control of energy usage and distribution puts you in a more powerful position. Are such new technologies expensive? No, they are not as automation has brought down prices. Not having modern features can be more costly to your business as a building owner.

4. Better performing business, greater demand for your space. A modern, green retrofit building with efficient energy systems has been shown to lead to improved worker performance and reduced sick time compared to companies in existing buildings that have not retrofitted appropriately.

A recent Harvard study found that worker cognitive functions improved with better indoor environmental quality and ventilation, including a 50% increase in focus, doubling in crisis response, and a tripling in information usage and strategic thinking scores. A follow-up study found positive impacts on sleep and wellness. https://green.harvard.edu/tools-resources/research-highlight/impact-green-buildings-cognitive-function

5. Rising revenue for a modern building. Continuing on these themes, providing potential tenants with the most modern technologies, reliable energy service, and beneficial working conditions will result in greater market demand. Buildings certified as energy efficient (LEED, Energy Star) are in greater demand and can charge greater rents than stodgy, inefficient buildings with not a lot of specialization to offer the tenant.

Modernizing older buildings with improved energy efficient systems appears to be expensive and a “hassle”. However, the technologies are established, have little chance of failing, and results in many positive items that will raise both the value of your property and the demand to rent space from it, raising revenue and lowering cost significantly. This can only be done, however, if retrofits are implemented intelligently, led by experienced architects and engineers.

CCES has the technical expertise to help you plan and implement smart upgrades to your existing building to gain the benefits listed here. Our experts can help you lower energy usage and costs reliably and to maximize the benefits and, with the help of incentives, minimize the payback and hasten growth. Contact us today at 914-584-6720 or at karell@CCESworld.com.

Should I Be More Energy Efficient or Should I Go For Renewable Energy?

Building owners and managers are seeing more and more evidence of the growing costs of energy and realize these costs must be managed and lowered. But how does one most effectively do this? Does one evaluate the current systems that use energy (HVAC for comfort, lights for lighting, plug load) and make smart upgrades to improve its efficiency (do the same or more using less electricity or gas/oil)? Or does one invest and implement renewable energy to bypass the local utility and take advantage of the free resource generating energy (solar, wind, geothermal)?

Certainly being more energy efficient is a good thing financially for your building. It is in your interest to operate your equipment – for which you paid a lot of money – properly and efficiently; you want to get your money’s worth. If a system (an area of lights, a rooftop unit, a boiler, some PCs) is wasting energy day after day, it is in your interest to replace or upgrade it with equipment that works as well, but uses less energy. On the other hand, renewable energy is all the “rage”, with prices declining. There is certainly security; we know, if designed right, solar, wind, etc. work reliably. Being less dependent on your local utility is a good thing. Which one should a smart building owner/manager lean toward?

Well, it is best to optimize both strategies, but in a particular order. It is tempting to install solar panels or a wind turbine right away. It’s a great “show” piece for stakeholders, incentives are available in many places, and prices are coming down. But it is best to emphasize energy efficiency first. Have a thorough energy audit performed by an experienced, certified (P.E., CEM, or CEA) professional. That auditor will undoubtedly identify multiple smart strategies to save energy, with numbers demonstrating that each potential strategy will pay back the initial costs for the strategy in a reasonable amount of time, taking into account local incentives. Do not take the numbers literally. For example, if a payback of a certain strategy is listed as 3.2 years, it may end up being a little shorter or longer because factors involved in the audit and calculations are changeable. However, in a well-performed audit, the real payback is usually close to the predicted. Seriously consider and implement one or more listed strategies in the audit report that your company is comfortable addressing. Measure and note the decline in electricity or gas/oil usage. Remember that most energy efficiency projects have other benefits that renewable energy does not confer, such as improved productivity and reduced O&M costs and efforts. So you are getting these confirmed financial advantages relatively early.

Now that energy usage has been reduced and efficiency improved, you can consider alternative sources of energy. Solar panels and wind turbines are improving in effectiveness and reducing in price in time, so a slight delay in their procurement is probably in your favor. But more important, with energy usage minimized, now you can design the proper sized and placed system, reducing the upfront costs. If you bring down your electricity usage, say 20% because of improved efficiency (better lights, plug load, improved weatherization, upgraded HVAC), that could reduce the number of solar panels or wind turbines needed to reach your goals, reducing the capital costs you would need to get from Financial or any type of loan you may take out. And this will reduce the labor needed to install the equipment and leave you room on your roof or property for other things.

Sources estimate that currently energy efficiency typically costs one-third to half the full cost of rooftop solar. Therefore, it makes sense to prioritize efficiency before sizing a rooftop system, reducing the number of panels needed. For example, if a 40 kW commercial solar system can be reduced to 30 KW because of reduced need for power (improved efficiency), then the upfront cost for the panels can be reduced by $15,000 or more, a financial incentive to optimize energy efficiency first. It would not be good to install a large system and then after implementing energy efficiency projects find out that such a large system was not needed after all for the long-term future. Obviously, the exact numbers may vary based on efficiency and renewable energy incentives available.

CCES has the experts to perform a thorough and useful energy audit of any building type, providing normally multiple smart strategies to reduce energy usage effectively and at a reasonable payback. We can project manage the strategies you select to ensure that you get the maximum benefits (on top of utility cost savings) of the selected upgrade. And then we can help you decide on which renewable energy source is right for your building and work with established vendors to ensure that a good system is installed, providing you with maximum benefits and is smooth to operate. Contact us today at karell@CCESworld.com or at 914-584-6820.