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MONTHLY NEWSLETTER:  JUNE 2005 ISSUE

TRANSFER $ FROM YOUR UTILITY BILLS TO YOUR EDUCATION BUDGET
BY RICHARD G. LUBINSKI, THINK ENERGY MANAGEMENT, LLC


As Administrators of Charter Schools, you are challenged by expanded educational and administrative requirements and are under constant budgetary pressure due to rising costs. A part of these costs are utility bills that theoretically were supposed to be going down due to the “promises made” about utility deregulation. Unfortunately, this trend of rising utility costs will probably continue in the foreseeable future. Hidden in this administrative challenge is the “opportunity” available to your organization through demand-side energy management.

In most buildings, utility dollars are being wasted at a time when the cost of the energy is increasing. This is an ideal time to focus on your facility’s utility costs and look for self-funded energy management improvements. Intelligent energy management projects not only produce permanent reductions in your operating costs, they pay for themselves and often generate higher return on investment (ROI) and produce higher net present value (NPV) than many alternative investments for your scarce capital dollars. A bonus of many intelligent energy management projects is improvement in your building’s lighting, comfort, etc.

The place to start is getting your arms around your building’s actual energy costs. This can be done in a spreadsheet based on the past 12 to 24 months of electricity, natural gas, water/sewer, and any other energy related expenses. A fast and easy method to collect some of the same information is to request the utility companies and/or 3rd party energy commodity providers to fax or email you a 12 to 24 month detailed energy billing history (account number, meter number, billing dates, meter readings, energy consumption, dollars billed, etc.). Your energy consumption history and seasonal relationships matter in the evaluation of your Supply-Side and Demand-Side energy management opportunities. The next step is to review this data with an independent energy consultant (professional without any ties to any product or service). Your building’s energy history and profile is then added to an understanding of your building’s operations. Your building operations include type of hours of operation, lighting/mechanical system, automatic or manual controls, and operational needs.

There are educational and technical resources available from government and private websites like www.doe.gov and www.think-energy.net. While “simple payback period” is an overly simplistic management tool, it is easy to understand and useful to compare the “relative value” of the Energy Conservation Measures (ECMs) that could be applied to your building(s). Examples of some typical payback periods for ECMs which depend on your operating hours and local utility costs can be found at :http://www.think-energy.net/ecm_payback.htm.

Intelligent energy management projects not only produce permanent reductions in your operating costs, they pay for themselves…

These typical payback periods can be improved if your area has Demand- Side Management (DSM) energy efficiency rebates. Some electric utility companies offer cash rebates to building owners who invest in energy efficiency improvements in their buildings. These rebate programs are generally based on the size of your electricity consumption (KWH) reduction and/or electrical demand peak (KW) reduction created by your energy efficiency improvements. In some states there are “public benefit” funds created and administrated by the state and funded through KWH taxes added to your monthly electricity bills.

The recent trends in natural gas (NG) have been alarming, and the trend continues towards higher long-term cost based on NG consumption trends, NG held in storage, NG wells that are being drilled (rig count), and other market factors. The only relief in sight is the relatively new development of importing NG from overseas via liquidified natural gas (LNG). Like crude oil, this is the beginning of the country’s dependence on another energy source from outside the country.

If you are able to eliminate the waste of energy dollars in your facility, these funds can be used to (a) self fund energy efficiency improvements and then (b) return to your school’s checkbook to be used for more important uses (educational programs, teachers salaries, etc.)

Richard G. Lubinski,CEM,CDSM,CEMSC,BEP, President, Think Energy Management LLC
rick@think-energy.net