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Increase cash flow through demand side management.

Owners and managers of multi-family buildings must deal almost daily with a number of factors that affect their properties' cash flow. They have little control over many of these factors including taxes, rent income at controlled buildings and certain routine maintenance expenditures. These uncontrollable costs make it even more critical to use discretion over factors that can be controlled.

One of these factors is energy costs. Lighting, heating, air conditioning, motors and other devices represent a significant portion of total operating costs at multi-family buildings. It's rare that a building can be found where no energy efficiency improvements can be made. Some of these improvements are simple and inexpensive while others are more complicated and costly, taking longer to recoup the initial cash outlay in the form of savings on energy bills.

In either case, after the payback period, the savings is the building owner's to keep or use to hold down maintenance costs or rent increases. So the question for owners and managers of multi-family buildings becomes not whether to make energy efficiency improvements, but which ones to make first.

The logical first step is to contact your electric or gas utility. Con Edison and other utilities offer free surveys which evaluate a building's envelope, including insulation, windows and doors, as well as the heating and hot water systems, air conditioning and lighting efficiency.

Con Edison's Apartment Building Conservation (ABC) Survey provides a full written report which includes a number of ways to make energy efficiency improvements. It also projects savings and payback periods, making it easier for building owners and managers to make informed decisions on which projects to tackle first.

One of the most common findings of ABC surveys is inefficient lighting in a building's common areas. Basements, lobbies, hallways and stairwells often have incandescent bulbs or older, inefficient fluorescent lighting. Tbere are a wide range of remedies for inefficient lighting.

A simple inexpensive method is to replace incandescent bulbs with compact fluorescent lamps. It is as easy as changing a light bulb and compact fluorescents use only about 25 percent as much electricity to provide the same amount of light as the incandescent bulbs they replace. Although they cost more than incandescents, compact fluorescents last about ten times as long.

A more expensive alternative is to do a total lighting system change-out, replacing old fixtures, ballasts and fluorescent tubes with new, energy-efficient equipment such as electronic ballasts, fixtures with reflector kits and lower wattage fluorescent tubes.

Lighting, however, is not the only common finding of ABC surveys. Often, our audits find that simple, inexpensive steps such as installing pipe insulation or caulking and weatherstripping on windows and doors can result in huge savings in heating bills and make apartments more comfortable for residents. An old door without caulking or weatherstripping has the same heat-loss effect as a hole in the wall the size of a baseball.

Lowering hot water temperature is another way to save on fuel costs. Con Edison recommends hot water temperature of 125 degrees, except where higher temperature is required by law.

Some more costly improvements include replacing old windows with new double pane, insulated windows and replacing old, inefficient boilers. While these improvements require a substantial cash investment, they can pay for themselves in energy savings in several years.

Many boilers in multi-family buildings in die New York area have been converted from coal or oil to another fuel such as natural gas. This converted equipment is usually among the most inefficient. A boiler is considered efficient if it has a combustion ratio of 80 percent or higher.

Once you receive your utility survey and decide which energy conservation measures to take, you should once again contact your utility company. Many, including Con Edison, offer rebates to offset the cost of new equipment such as lighting, air conditioning, motors and conversions to clean, efficient gas heat. In order to qualify for a rebate, however, you must have the project approved by the utility. Con Edison will not grant rebates for jobs done prior to submitting an application.

There are other advantages to an ABC survey from Con Edison. Every building that has an ABC survey conducted will receive one compact fluorescent lamp, one energy-efficient showerhead and one refrigerator coil cleaning kit for each unit in the building. If the building is a master-metered one, these free giveaways can mean big savings in electric and water heating costs with no cost to the building owner. Also, the New York State Energy Office will accept Con Edison ABC surveys as documentation when applying for a low-interest Energy Investment Loan.

Apartment building owners or managers in Con Edison's gas service territory of Manhattan, Bronx, Westchester and parts of Queens interested in having an ABC survey conducted can call the Con Edison Enlightened Energy hotline at 1-800-343-4646.
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Title Annotation:Residential Properties; advice on energy conservation for owners and managers of multi-family buildings
Author:Egan-Annechino, Eileen
Publication:Real Estate Weekly
Article Type:Column
Date:Nov 17, 1993
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