Mr. Kiesner

Eco-Friendly Practices

Plan Your Way to Long-Term Energy Cost Savings

By Steve Kiesner, Director of National Accounts, Edison Electric Institute

Last winter's high natural gas prices may make seem like a distant memory now, but you should think about your hotel's energy use as a regular and year-round cost to control, just like all your other variable costs. Every dollar you save on energy will go straight to the bottom line, giving you more resources for use elsewhere.

The U.S. lodging industry today spends close to $4 billion on energy every year. If hotels could improve their energy performance by an average of 30 percent, the hotel industry's annual electricity bill savings alone would be nearly $1.5 billion, according to the U.S. Environmental Protection Agency. This would represent a savings of approximately $365 per available room night per year for every hotel room in the country.

But where do you start? An excellent local resource to guide you is your electric utility company. They can help, often for little or no cost. Your utility representative will likely have historical data about energy use in your business. The local electric can be also help you with answers about electric utility incentive programs, discount electricity rates, energy-efficient equipment, or any other energy-related question. Call them or visit their Website. For a list of energy assistance programs around the country, use this link:

http://www.eei.org/industry_issues/retail_services_and_delivery/wise_energy_use/programs_and_incentives/progs.pdf

To begin taking charge of your energy use, start by making a plan. Edison Electric Institute, on behalf of the nation's electric utility companies, offers you the following steps to help you plan how to get the most use from every energy dollar.

You must first build a team. Generally, you will need representatives from management or administration. Top-level commitment is paramount. Pull the team together for a planning session and start laying the groundwork. The team will need to define success with goals that are realistic. Is saying you want to save 10 percent over two years possible? What is the base you will measure against? How and when will the measurement be made?

Create an action plan for implementing the top priority energy-saving measures. Assign whom to do what by when and within what budget. Assign plan components to those who are capable of accomplishing the task. Then celebrate your successes. Do not wait until the end of a two-year program to announce results. Create regular milestones and incentives to meet them. Make people feel a part of the program's success and it will take on a life of its own.

Now that you have your team, the best way to determine exactly how to cut your energy costs is to conduct an audit of your facility's energy use. There are two types of energy audits-a walk through audit and a computerized analysis audit.

Walk-Through Audit - A walk-through audit is a simple, low-tech place to start. This is the easiest and least expensive means of identifying and evaluating your energy use. Since people have a major effect on how energy is used, this audit pays particular attention to identifying habits and procedures that can be adopted to use energy more efficiently.

Computerized Analysis Audit - An analysis audit identifies more comprehensive, capital-intensive energy saving improvements. Your business's energy data is run through a computer program and interrelated. The resulting analysis provides specific recommendations for energy savings that include determining the most economical rate for your facility, equipment replacements, or retrofits and building structural or design modifications. There is usually a fee for an analysis audit; in many cases, the local electric utility may provide this service for you.

Understand what equipment are your big energy users. A small improvement in an area that consumes a lot of energy, like heating and cooling, water heating, or lighting, will make a larger impact on the bottom line.

Lighting - Lighting is usually the largest electricity user and should be the first place to look for savings. Many facilities report savings of 20 to 50 percent. If you are replacing equipment, the costs can be significant, but if customers have older lighting systems, the paybacks are usually quick (under 3-4 years).

HVAC - Your heating, ventilation, and cooling system offers savings of 30 percent or more by improving efficiency and maintenance. Savings come from keeping the system off when not needed, changing temperature settings, and making the system more efficient.

Refrigeration - Savings come from operating the equipment in an efficient manner and in carefully evaluating a manufacturer's stated energy efficiency and estimate operating costs before purchasing the equipment.

Building Envelope - The envelope-everything that separates the inside from the outside-has a major influence on the HVAC system. When it operates effectively, when it limits heat losses and gains, the building will require less energy.

Hot Water -Lower temperature settings, fixing hot water leaks, using heat recovery systems are all ways to control energy here.

Food Preparation - Like water heating, food prep can be made to use less energy through operation that is more efficient and equipment selection.

Installing an energy management control (EMC) system is a measure that can enhance the other energy-saving actions or improvements you choose to make. EMC systems can save 10 to 20 percent on electricity costs. It may be the most cost effective measure you can take, especially to guard against needless energy waste. Remember, the best time to save money in a room, an area, or a facility is when no one is there. Although some of the savings come from reduced consumption resulting from equipment being turned off, the big savings often comes from systems able to reduce electrical demand, thereby saving on demand charges.

A popular way to evaluate any energy saving improvement is by calculating how long it will take the investment to pay for itself in energy savings.

As discussed at length in my last column, the nation's new energy law, the Energy Policy Act of 2005, contains a variety of initiatives and incentives to boost the country's overall energy efficiency. One way is by setting higher energy-efficiency standards for new commercial products that use large amounts of energy. The energy law also offers $2.7 billion in tax deductions and credits to encourage homes and businesses to purchase high efficiency products and appliances.

For example, commercial buildings that are built to exceed by 50 percent the energy efficiency rating of a "baseline" building in the American Society of Heating Refrigeration Air Conditioning Engineer's (ASHRAE) building code 90.1-2001 can qualify for a tax deduction of $1.80 per square foot.

The Energy Policy Act of 2005 is also offering federal tax credits for on-site distributed generation systems-solar energy, microturbines, and fuel cells-that meet certain efficiency requirements. For the latest and most complete information about the EPAct tax credits, please visit: http://www.energytaxincentives.org/

The country's energy situation will continue to be a challenge for hotels and businesses as they seek to lower their energy costs. By using energy more efficiently, you can take charge over your energy use. Importantly, you will be helping to improve the affordability and reliability of the nation's energy supplies as well.

Steve Kiesner is Director of the Edison Electric Institute’s National Accounts Program. Based in Washington, D.C., Edison Electric Institute (EEI) is the association of United States shareholder-owned electric companies, international affiliates and industry associates worldwide. Our U.S. members serve approximately 90 percent of the ultimate customers in the shareholder-owned segment of the industry, and nearly 70 percent of all electric utility ultimate customers in the nation. They generated almost 70 percent of the electricity generated by U.S. electric utilities. Mr. Kiesner can be contacted at 202-508-5000 or skiesner@eei.org Extended Bio...

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