A Sustainable Bottom Line

While energy audits are important at any point in time because they can amount to significant financial and environmental savings in apartment buildings, the recession has been an even stronger driving force in examining the performance of the nation’s existing housing stock. This has, in turn, “spurred the industry to take this on a little faster than it otherwise would have,” according to Dana Bourland, LEED AP, vice president of green initiatives, Enterprise Community Partners Inc.

“We have a huge inventory of existing housing, and many of these buildings, when we go back and [ask], ‘why did we do this?’ we explain it was done when no one cared about energy. … We live in very different times,” points out Allan Samuels, LEED AP, principal at Energy Squared LLC, a North Brunswick, N.J.-based full service energy design consultant firm.

Often an audit is started because an owner has high bills or resident complaints, notes Erica Brabon, BPI MFBA, LEED AP O+M, pipeline manager of existing buildings, Steven Winter Associates Inc., an architectural/engineering research and consulting firm based in Norwalk, Conn. “It’s a good idea for owners to play a role in tracking their own performance and knowing that it’s time [for an audit]. We see people who pay the bills but don’t realize there’s a problem.”

But that doesn’t mean something should go wrong before an audit is considered. “In today’s environment, with energy [costs] going up, everyone is looking at ways to save money,” reports Samuels “If we can show ROI under five years—and often under two—[the audit] sells itself.”

Equally as important as the up-front cost in evaluating the payback of an item is its lifecycle cost. And after a retrofit is completed, it’s important to perform a follow-up audit to determine whether the replacement is, in actuality, saving energy.

Owners and managers looking to undergo an energy audit must recognize that audits need to be performed by a third-party impartial company. A company whose core business is replacing toilets, for example, will likely perform an audit only on a building’s water use. “Be careful that you have someone who looks at all facets … not just one particular area, if you want the best bang for the buck,” cautions Rhonda Kreitz, vice president of Kennesaw, Ga.-based Energy Advisory Service.

The audit process

The first step in an audit is to benchmark a building’s performance based on its utility bills to determine its “miles per gallon,” or BTU/sq. ft./HDD (heating degree day), a measure of building performance, explains Brabon. It’s also important to determine whether an owner has any retrofit plans or if the building has recently undergone any renovations.

Once on-site, the auditor will collect hard data from the entire building, including at least 10 percent of the apartments to determine what systems are in place inside the units and how they are affecting resident health and safety. The data is then input into an energy model that will show how any improvement will impact the building’s performance and its bottom line, explains Brabon. For example, if a building planned to install LED lighting throughout, the energy model would understand how the lights would reduce heat gain in the building.

“I think, in general, we all want to be green [but] we see green as just an added benefit,” Samuels asserts. “What it’s really about is ROI … It’s got to be based on good financial business decisions.”

Enterprise Community Partners and CAS Financial Advisory Services recently developed the Enterprise Retrofit Audit Protocol, which establishes a baseline for metrics in the analysis of green improvements. In addition to financial considerations, the Protocol examines health implications for residents and on-site staff. According to Enterprise, many retrofit analyses fall short of underwriting requirements because they rely on audits that use inconsistent metrics.

“Enterprise started trying to address greening existing housing six years ago, and a major obstacle … was that owners thought they knew what needed to happen in terms of conservation measures,” explains Bourland. “There were some who would engage an auditor … but they would specify what systems and measures to run an analysis on. What wasn’t happening was a holistic approach of the entire building.

“It is really important that the industry adopt [an audit] standard, so we can measure the improvements and make sure the retrofits deliver the benefits we expect.”

In apartment buildings, air sealing is crucial since there are often cracks or holes between units and/or floors, and, Brabon notes, it also helps with indoor air quality and integrated pest management.

Other “energy hogs” in apartment buildings include heating, air conditioning and lighting, notes Samuels. The key to these elements, however, is installing controls. For example, lighting equipment in a given building may utilize the most up-to-date technology, but if the lights are on during peak sunlight hours, it is not being used to its maximum efficiency. The same goes for heating systems; boiler temperatures should be set according to the outdoor ambient conditions rather than a steady setting at all times. The payback for installing controls, says Samuels, can often be seen in less than one year.

Vacant apartments are also a waste of energy, notes Kreitz, suggesting that managers monitor their buildings’ daily energy use. If there’s a huge spike one day, a problem is found sooner rather than later.

Sophisticated systems, however, won’t achieve their potential savings if on-site management and residents don’t understand the environment of the building they’re in. “Even if you go through audits and retrofits, you can’t forget that people live there,” cautions Bourland. “It’s important to engage managers and residents and make sure that appliances and systems are being operated properly and that residents are engaged and know what they can be doing to lower energy and water usage.”

Costs and payback

Older buildings are more often known to run at less-than-optimum performance levels. Newer buildings can present great opportunities for savings, though, notes Samuels, particularly if they were not commissioned properly. “If we know what common systems are in the building and [its] age, we have a good idea of the potential savings in the building, and that would dictate whether it’s worthwhile” to perform an audit, Samuels adds.

Still, some owners may opt for more of a financial audit, points out Kreitz, where the provider will review a building’s utility bills to determine whether there are any extraneous charges that don’t relate to the building’s physical performance. “Usually they’ll start with the financial [audit] first because it’s a large investment to go with the full-blown energy audit,” Kreitz notes. “Although owners want to save money, it’s hard to pay the [up-front] cost.”

Bourland doesn’t agree. Rather than the cost of the audit being the deterrent, she believes that the resulting recommendations are what prevent owners from going through with the retrofit, since the up-front costs of some of these measures could be seen as “prohibitively costly.”

That same line of thinking provides incentive for owners to keep energy costs in line, which is where Enterprise’s Protocol fits in. “We don’t want to see the two measures with the quickest payback be installed and miss an opportunity to holistically improve the whole building,” notes Bourland. “Sometimes when you don’t think of the building as a system and you only make one improvement, you might not be realizing some negative impacts.”

To comment, e-mail Erika Schnitzer at [email protected]