Facilities professionals often choose not to invest in energy-efficiency upgrades because of high perceived upfront costs. But if you’re armed with the right information, you’ll see that energy savings, rebates, and incentives can make funding a green retrofit project more realistic.
Check out this comparison of lighting, HVAC, and window film upgrades to see which sustainability retrofit is best for your facility.
LIGHTING
Any project that improves the efficiency of the lighting system could be considered a lighting retrofit. These upgrades can incorporate everything from installing lighting controls, to converting an entire building’s lighting system to LEDs. Common lighting retrofits include replacing T12 lamps, installing occupancy sensors, and implementing control systems.
Upfront costs:
According to research from the Institute of the Environment and Sustainability at the University of California at Los Angeles (UCLA), the average cost per square foot for a lighting upgrade is roughly $5. However, this number varies greatly depending on the upgrade selected. For example, occupancy sensors range from $30 to $130 each, according to Waste Reduction Partners. But transitioning from T12 to T5 lamps can cost between $20 and $40 per lamp, proving to be a much costlier upgrade.
ROI/savings:
Possible savings and ROI for a lighting system retrofit depends on many factors.
On average, lighting retrofits can yield a 45% ROI in about two years. First-year average savings are approximately $200,000, according to UCLA’s survey of 129 commercial buildings ranging in size. But these numbers range based on the size of your building, the lighting technology used, rebates and incentives put toward the project, etc.
Funding:
Utilities offer energy-efficient lighting upgrade and replacement rebates that can cover up to 50% of installation costs. Prescriptive rebates offer a predetermined dollar amount per fixture, while custom rebates are based on energy savings from the lighting retrofit.
Incentives are also available in the form of tax credits and special financing, depending on your location. Visit www.dsireusa.org to find out more about what’s available in your state.
Examples:
- Ernst & Young’s headquarters building in New York City reduced upfront costs for its LED retrofit by more than 13% through utility rebates. Transitioning to LEDs is projected to save the company nearly $1 million annually, cutting energy and maintenance costs by up to 50%, according to the project team.
- A lighting retrofit at Marriott International headquarters is anticipated to reduce energy use by 860,000 kWh per year (66%), and save up to $120,000 in energy and maintenance costs. The estimated ROI is slightly more than two years. Utility rebates and EPAct savings of $130,000 helped Marriott complete this project.
HVAC
An HVAC retrofit involves any project aiming to improve the efficiency of the HVAC system. HVAC upgrades can range from installing continuous environmental management systems, to replacing or retrofitting individual components of a system (boiler, furnace, heat pump, air-side economizers, etc.).
Upfront costs:
According to UCLA’s study, the average cost per square foot for an HVAC retrofit is $8.49. As with any upgrade, this number varies greatly depending on the project.
In fact, an HVAC upgrade can be so expensive that the U.S. Small Business Administration recommends trying to first reduce your facility’s load by adding insulation, installing window film, or upgrading lighting before embarking on an HVAC upgrade.
ROI/savings:
In a survey of 129 commercial buildings ranging in size from 1,160 square feet to 8 million square feet, UCLA says that year-one savings for an HVAC retrofit is approximately $300,000, depending on the size of the building and system, the upgrade itself, etc.
The Pacific Northwest National Laboratory estimates that large commercial buildings could cut HVAC costs by up to 25% to 35% by adding certain retrofits to existing large HVAC systems on their rooftops.
Average ROI for HVAC upgrades is approximately five years, according to the Lawrence Berkeley National Laboratory.
Funding:
Utilities offer HVAC upgrade rebates that can cover a substantial portion of the cost. Prescriptive rebates offer a predetermined dollar amount, while custom rebates are based on energy savings from the retrofit.
Incentives are also available in the form of tax credits and special financing, depending on your location. Visit www.dsireusa.org to find out more about what’s available in your state.
Examples:
- A chiller loop project at Bakersfield College connects three buildings so that air is cooled by one chiller. The project cost $500,000, and a full ROI should be seen after seven years.
- By integrating controls, a two-way valve primary secondary chilled water system, a new chiller, thermal ice storage system improvements, and VAV air handlers with direct digital controls, Oklahoma City Community College has seen energy use per square foot drop by 35%.
WINDOW FILM
Installing window film is a way to improve window performance by reducing solar heat gain to balance building temperatures, keep the heat out in summer and in during winter, reduce HVAC system load, control utility costs, and reduce glare.
Most windows take approximately 15 minutes for window film application, with minimal or no disruption to building occupants.
Upfront costs:
A typical window film installation is $7 per square foot of window glass, but this varies depending on the type and amount of window film being installed. This cost equals about $0.35 to $0.70 per square foot of floor space for most buildings.
ROI/savings:
Commercial window film delivers a typical payback of three years or less. Depending on building characteristics, high-performance films focused exclusively on energy savings can deliver energy savings at an even faster pace in some cases.
ConSol, an independent energy consulting firm, estimates that ROI for window film ranges from 6% to 68% percent annually, depending on climate zone and the type of film. For example, a mild climate like Oakland, CA, sees a 20-percent annual ROI with window film; buildings in climates that aren’t as mild can see a faster payback of around two years.
Funding:
Utilities offer rebates that can cover up to 50% of the project cost. Prescriptive rebates offer a predetermined dollar amount, while custom rebates are based on energy savings from the retrofit. (If your utility doesn’t list window film as an option, it may still be eligible under “Custom Measures” rebates, which can offset installation costs by almost 30%).
Incentives are also available in the form of tax credits and special financing, depending on your location. Visit www.dsireusa.org to find out more about what’s available in your state.
Examples:
- The Peri Executive Center in Walnut Creek, CA, saw a dramatic decrease in utility costs of between 12% and 15% after installing window film.
- The Winston-Salem, NC, Marriott installed window film to lower hotel room temperatures, and its annual HVAC costs have dropped by five percent ($24,000). The hotel anticipates a full ROI in three years.
Lighting, HVAC, and window film are some of the most popular sustainability retrofits for commercial buildings, but that doesn’t mean they’re the only options. Spend time evaluating the condition of your building, each system’s performance, and your energy and operational goals before you decide which upgrades will provide the most ROI for your facility.
Steve DeBusk is global energy solutions manager for Eastman Chemical Company’s Vista brand.