Managing utility costs without acting like Ebenezer Scrooge<\/h1><\/div>![\"electric](\"https:\/\/iesmartsystems.com\/wp-content\/uploads\/2021\/07\/Screen-Shot-2021-07-02-at-9.27.12-AM-min.png\" "\\"utility")
<\/span><\/div><\/div>In the first chapter of Charles Dicken\u2019s\u00a0A Christmas Carol<\/em>\u00a0the author describes Ebenezer Scrooge as a man who permits his employee, Bob Cratchit, a fire with only a single lump of burning coal in it, and to make matters worse Mr. Scrooge keeps the coal scuttle in his office, threatening to fire Bob if he asks for more coal. One can imagine a modern-day Mr. Scrooge eyeing the office temperature from his smartphone, waiting to correct any fluctuations to minimize the utility cost per square foot.<\/p>\nIt\u2019s an over-dramatic and overly simple picture of what companies face when managing their utility costs. The goal is to use exactly the\u00a0right<\/em>\u00a0amount of water, electricity, and gas to keep the business running and the employees comfortable so they can focus on productivity. It\u2019s hard to imagine a company that would fire an employee for asking to turn up the thermostat, but the amount of money a single company loses every year to inefficient utility management amounts to tens, and often hundreds, of thousands of dollars \u2014 a salary\u2019s worth on the low side. In fact, energy costs account for\u00a020% of the average office building\u2019s costs<\/a>.<\/p>\nThe good news about this dilemma is that it doesn\u2019t demand hard choices between headcount and heating (or cooling) bills \u2014 it requires careful optimization and the strategic application of automation technology.<\/p>\n<\/div>
Comparing Energy Usage<\/h2><\/div>First, you need a benchmark to compare your current costs, usually measured in dollars per square foot (PSF), which you calculate by dividing your monthly utility cost by the total square footage of real estate serviced. For example, in 2018, private-sector office buildings reported a utility cost of $2.14 PSF.<\/p>\n
The numbers for commercial buildings also vary by region, illustrated by the\u00a0U.S. Energy Information Administration\u2019s map<\/a>. It\u2019s important to compare your utility costs to similar businesses operating in comparable regions.<\/p>\n<\/div>Houston Utility Cost Per Square Foot<\/h3><\/div>Utility usage varies a lot depending on the type of commercial property and by state or region. However, we can outline the average cost of utilities in Houston, our hometown, to provide a better understanding of expected costs.<\/p>\n
It won’t come as a surprise to anyone reading this from Houston, but this city can get hot. Electricity is typically the most expensive utility for any business or commercial space, and while Texas does benefit from deregulated electricity (at least in terms of cost), the Houston heat results in some high summer utility costs. The average Houston commercial electricity rate, as of June 2021, is 10.5 centers per kWh. This is is about 4% lower than the national average.<\/p>\n
Industrial natural gas rates are also typically cheaper in Houston. As of March 2021, the average cost of industrial natural gas (per thousand cubic feet) was $3.04 – which was 30.4% less than the national average.<\/p>\n
Houston bills for water at two different rates – a rate for your first 2,000 gallons and then a lower rate after that amount. The commercial price for water under 2,000 gallons is $13.24. After that, water is billed at $6.62 per 1,000 gallons.<\/p>\n<\/div>
There Are Many Ways To Reduce Utility Costs<\/h2><\/div>You probably aren\u2019t counting your \u201cnegawatts.\u201d<\/h3><\/div>Negawatts is a term that refers to power saved through conservation or improved efficiency. In much the same way that negative numbers cancel out positive ones, negawatts counteract your energy consumption. It\u2019s a memorable way to label and measure the effects of reducing energy consumption. There are at least two approaches to increasing your negawatts.<\/p>\n<\/div>
Tune-ups<\/h4><\/div>Especially if your heating and cooling equipment is older, it\u2019s important to run HVAC diagnostics to look for ways to optimize your boiler and chiller units. You can also look into upgrading the building management system\u2019s software. System tune-ups rarely require heavy investment and can pay for themselves in under 24 months.<\/p>\n<\/div>
Retrofits<\/h4><\/div>Once you\u2019ve established your utility cost per square foot, and measured the ratio of how much each system contributes to your overall cost you can begin evaluating retrofitting individual components. By comparing the efficiency of newer equipment you can even estimate the payback period for such upgrades \u2014 a 20-50% improvement in efficiency can add up fast.<\/p>\n<\/div>
Building Automation Can Unlock Huge Utility Savings<\/h3><\/div>If you\u2019re Mr. Scrooge deciding how much coal you need to heat a one-room counting-house, you don\u2019t need fancy sensors. But virtually every single modern business can benefit from\u00a0installing a building automation system<\/a>\u00a0that ties together smart appliances, lighting, sensors, and human occupancy traffic.<\/p>\nBy monitoring demand and usage you can identify the times of day when it\u2019s ideal to let water heaters idle, lighting to dim, and the HVAC system to ease off. When you need electricity greatly affects how much it costs, usually represented as a \u201cdemand charge\u201d on your utility bill. If you can shift usage away from high-demand times or cut overall usage, you\u2019ll see the gains to your bottom line very quickly.<\/p>\n
<\/span><\/div>In the first chapter of Charles Dicken\u2019s\u00a0A Christmas Carol<\/em>\u00a0the author describes Ebenezer Scrooge as a man who permits his employee, Bob Cratchit, a fire with only a single lump of burning coal in it, and to make matters worse Mr. Scrooge keeps the coal scuttle in his office, threatening to fire Bob if he asks for more coal. One can imagine a modern-day Mr. Scrooge eyeing the office temperature from his smartphone, waiting to correct any fluctuations to minimize the utility cost per square foot.<\/p>\n It\u2019s an over-dramatic and overly simple picture of what companies face when managing their utility costs. The goal is to use exactly the\u00a0right<\/em>\u00a0amount of water, electricity, and gas to keep the business running and the employees comfortable so they can focus on productivity. It\u2019s hard to imagine a company that would fire an employee for asking to turn up the thermostat, but the amount of money a single company loses every year to inefficient utility management amounts to tens, and often hundreds, of thousands of dollars \u2014 a salary\u2019s worth on the low side. In fact, energy costs account for\u00a020% of the average office building\u2019s costs<\/a>.<\/p>\n The good news about this dilemma is that it doesn\u2019t demand hard choices between headcount and heating (or cooling) bills \u2014 it requires careful optimization and the strategic application of automation technology.<\/p>\n<\/div> First, you need a benchmark to compare your current costs, usually measured in dollars per square foot (PSF), which you calculate by dividing your monthly utility cost by the total square footage of real estate serviced. For example, in 2018, private-sector office buildings reported a utility cost of $2.14 PSF.<\/p>\n The numbers for commercial buildings also vary by region, illustrated by the\u00a0U.S. Energy Information Administration\u2019s map<\/a>. It\u2019s important to compare your utility costs to similar businesses operating in comparable regions.<\/p>\n<\/div> Utility usage varies a lot depending on the type of commercial property and by state or region. However, we can outline the average cost of utilities in Houston, our hometown, to provide a better understanding of expected costs.<\/p>\n It won’t come as a surprise to anyone reading this from Houston, but this city can get hot. Electricity is typically the most expensive utility for any business or commercial space, and while Texas does benefit from deregulated electricity (at least in terms of cost), the Houston heat results in some high summer utility costs. The average Houston commercial electricity rate, as of June 2021, is 10.5 centers per kWh. This is is about 4% lower than the national average.<\/p>\n Industrial natural gas rates are also typically cheaper in Houston. As of March 2021, the average cost of industrial natural gas (per thousand cubic feet) was $3.04 – which was 30.4% less than the national average.<\/p>\n Houston bills for water at two different rates – a rate for your first 2,000 gallons and then a lower rate after that amount. The commercial price for water under 2,000 gallons is $13.24. After that, water is billed at $6.62 per 1,000 gallons.<\/p>\n<\/div> Negawatts is a term that refers to power saved through conservation or improved efficiency. In much the same way that negative numbers cancel out positive ones, negawatts counteract your energy consumption. It\u2019s a memorable way to label and measure the effects of reducing energy consumption. There are at least two approaches to increasing your negawatts.<\/p>\n<\/div> Especially if your heating and cooling equipment is older, it\u2019s important to run HVAC diagnostics to look for ways to optimize your boiler and chiller units. You can also look into upgrading the building management system\u2019s software. System tune-ups rarely require heavy investment and can pay for themselves in under 24 months.<\/p>\n<\/div> Once you\u2019ve established your utility cost per square foot, and measured the ratio of how much each system contributes to your overall cost you can begin evaluating retrofitting individual components. By comparing the efficiency of newer equipment you can even estimate the payback period for such upgrades \u2014 a 20-50% improvement in efficiency can add up fast.<\/p>\n<\/div> If you\u2019re Mr. Scrooge deciding how much coal you need to heat a one-room counting-house, you don\u2019t need fancy sensors. But virtually every single modern business can benefit from\u00a0installing a building automation system<\/a>\u00a0that ties together smart appliances, lighting, sensors, and human occupancy traffic.<\/p>\n By monitoring demand and usage you can identify the times of day when it\u2019s ideal to let water heaters idle, lighting to dim, and the HVAC system to ease off. When you need electricity greatly affects how much it costs, usually represented as a \u201cdemand charge\u201d on your utility bill. If you can shift usage away from high-demand times or cut overall usage, you\u2019ll see the gains to your bottom line very quickly.<\/p>\nComparing Energy Usage<\/h2><\/div>
Houston Utility Cost Per Square Foot<\/h3><\/div>
There Are Many Ways To Reduce Utility Costs<\/h2><\/div>
You probably aren\u2019t counting your \u201cnegawatts.\u201d<\/h3><\/div>
Tune-ups<\/h4><\/div>
Retrofits<\/h4><\/div>
Building Automation Can Unlock Huge Utility Savings<\/h3><\/div>
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