Energy Audit… Worth the Cost?

7-09-2013 Energy Audit… Worth the Cost?

by Douglas Elbinger, Energy Policy Analyst,

63279-4When you consider that energy is one of the largest controllable operating expenses in your commercial facility, you may want to take a closer look at the value of an ‘energy audit.’

Begin by thinking of an energy audit as an essential financial tool, just like a Profit & Loss (P&L), to assist in your control of the bottom line. The word audit may have a negative connotation, but in this case, think of it as something that will save, or make you money, rather than cost.  In most cases energy audits save significantly more than they cost, have an attractive Return on Investment (ROI), and are often ‘no cost’ when bundled with other energy services.

To put the energy audit in perspective, for just a moment, try to forget everything you’ve ever heard about energy costs; take a deep breath, relax, and consider this one simple idea: The cleanest and cheapest energy is the energy we don’t use at all.

So the biggest and best thing going here is energy conservation – plain and simple. When you also consider ‘total cost of ownership’ over a period of five, 10 or 20 years, audit reports will demonstrate in graphic detail how incremental changes can add up to huge savings. The energy audit is your guide to achieve this by measuring and analyzing your building energy performance over time. For this to work, energy consumption is measured on a total scale… not just light bulbs, but HVAC, whole building envelope, roof, insulation, security systems, and water use.

If you have a gut feeling that the cost of energy is constantly rising and your energy dollars are going up in smoke, keep reading. Any building, any size, old or new, can benefit from an audit. Typically, buildings that are ten years or older, that haven’t had an HVAC upgrade, lighting upgrades, and regular scheduled maintenance, are prime targets to get the greatest benefits.

In many parts of the country, commercial real estate owners have reported that doing efficiency retrofits not only saves on monthly operating costs, but ‘going green’ can also help them attract higher-paying tenants.

So what exactly is an energy audit – and why should you invest in the process?

According to Mr. Jim Newman, ( an internationally recognized expert in building energy conservation, “The objectives of an energy audit are to identify and develop the modifications that will reduce energy use and cost of operating a building.”

There are four levels of Audit:

  1. Level I Preliminary Energy Use Analysis – This looks at the energy use of the building and compares it with similar buildings to develop energy and cost indices, and make a rough determination of the benefits of further analysis.
  1. Level II Analysis or Walk-Through Analysis – This includes information on space functions and systems, which can be obtained without conducting a detailed analysis of the building. A note of caution: building owners have to be careful here, as there are many people and companies doing this type of analysis without proper ‘certification,’ which are essential in some jurisdictions.
  1. Level III Energy Survey and Engineering Analysis – This is a true energy survey with a complete analysis of the systems and the building. It should include a thermographic (infra-red) analysis to show areas of heat loss, as well as detailed analyses of systems operations. It should also include analyses of costs of various retrofits, the savings and ROI by implementation of these retrofits, as well as proper operation and maintenance of equipment and systems. This tends to be the analysis many companies prefer after the Preliminary Analysis is performed. If the preliminary analysis points to a number of potential energy-conserving retrofits to be performed, it will eliminate the cost and time involved with the Level I Analysis.
  1. Level IV Investment Grade Analysis – This is a detailed analysis for capital-intensive modifications through performance contracting. It is normally used only when seeking outside funding for capital expenditures, or when the monetary size of a retrofit requires Board approval.

By implementing the changes and recommendation discovered by an energy audit, how much can building owners expect to save on their utility bills?

Examples from case studies indicate that since the electrical costs of a typical commercial office building are usually in the vicinity of 70 percent of the total utility bill – with lighting, cooling and office equipment accounting for considerably more than 50 percent of that – unless a building has been recently retrofitted, a good Level II energy audit can usually save more than 15 percent.  We have seen some projects that have lowered the overall utility costs, including water, by more than 25 percent.

Lighting retrofits from incandescent to LED alone can save up to 80% on that portion of the bill. It’s all very dependent on how well the building is being operated, as well as how much an owner is willing to invest, how much control a tenant has over their own individual utility costs, and, of course, the type of lease.

 How you can get started and lower your utility bills… without investing a lot of money?

Some of the easiest and least expensive ways are by making sure your equipment (including computers and chargers) is turned off when it’s supposed to be, such as after work hours. Making sure outside air dampers on HVAC systems with economizers are working properly, retrofitting older lighting and plumbing fixtures, making sure thermostats are calibrated and operating properly, correctly cleaning heat transfer coils on air handling equipment on a regular basis, changing filters as required, making sure outdoor condenser coils are clean (especially after cottonwood season), and making sure the chemical treatment for cooling towers is operating properly.

Find more information about certified energy auditors at the Association of Energy Engineers,



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