Spending to Save: Energy Efficiency Incentives and Payback

Suppose your CEO calls tomorrow and asks, “What are we doing about power consumption?” What will you say?

Reducing consumption by turning off computer monitors and equipment requires lifestyle changes to be adopted through the entire organization. These are easy choices to make but they are hard to implement and substantial return on investment is not assured.

Proven, existing efficiency technologies — in everything from lighting to climate control and voltage regulation — can unlock the untapped reserves of efficiency gains buried in many non-residential buildings. Plus government incentive programs remove the barriers to implementation by making the up-front costs and payback periods affordable.

In high-cost energy states such as California, the state government has allocated $3.1 billion for energy incentives for the next three years. New York State also passed legislation at the end of 2009 to make loans available for businesses that want to improve their energy efficiency.

Each state’s programs require different application processes for commercial and institutional buildings and industrial facilities, which means that despite the availability of funding, many building owners and facility managers leave this money on the table, in part because they overestimate the cost of saving energy and forfeit researching their energy saving options.

So when the CEO comes calling, consider whether you are being over-billed for your energy and review the options and funding.

IKEA, for example, saved 7% of its annual energy consumption and saw a 50 kilowatt reduction in peak demand after installing Legend Power’s voltage regulation device in it’s Richmond, BC, facility. The electronic tap changer regulates incoming voltage and reduces energy consumption and costs, extends the life of equipment and does not require work flow changes.

Lighting retrofits, and the replacement of air conditioning systems, industrial motors and other devices that consume electricity are other commonplace solutions covered by incentive programs.

To give you an idea of what is available, the following chart lists the states with the most expensive energy costs, the number of incentive programs that are available, and the state budget for energy efficiency projects.

To save money, reduce greenhouse gas emissions, and conserve power, the following resources can help you find the incentive programs in your area: The Database of State Incentives for Renewables and Efficiency lists all of the incentive programs in the US, by state. The US Department of Energy explains each state’s energy incentive programs.

Author Erik Wolfe works for Legend Power, an electrical energy conservation company.

photo: Leo Reynolds