Water and Light rebate plan could save utility costs

Saturday, June 6, 2009 | 12:01 a.m. CDT; updated 2:29 p.m. CDT, Sunday, June 7, 2009

COLUMBIA — A rebate program aimed at curbing consumers’ energy demand is estimated to save between $7 million and $14 million in utilities within 30 years, according to a report released by Columbia’s Water and Light.

For the remainder of fiscal year 2009, Water and Light requested an estimated $957,000 be allocated for expansion of the city’s demand-side management (DSM) program. The funds are in addition to the current budget of $1.4 million.

Commercial, industrial rebates

o    Commercial Heating, Ventilation and Air Conditioning Efficiency Retrofits-

o    Rebate:  86 cents per kWh saved annually

o    Cost to city: $50,000

o    Estimated savings: $170,000

o    Commercial Appliance Retrofits

o    Rebate: 51 cents per kWh saved annually

o    Cost to city: $5,000

o    Estimated savings: $5,950

o    Commercial Lighting

o    Rebate: $100 per kW or 10 cents per kWh saved annually

o    Cost to city: $80,000

o    Estimated savings: $1,361,600

o    Industrial Machine Drive:

o    Rebate: $100 per kW or 18 cents per kWh saved annually

o    Cost to city: $50,000

o    Estimated savings: $404,000

o    Industrial HVAC Retrofits

o    Rebate: 18 cents per kWh saved annually

o    Cost to city: $80,000

o    Estimated savings: $648,000

o    Industrial Lighting

o    Rebated: $100 per kW or 10 cents per kWh saved annually

o    Cost to city: $50,000

o    Estimated savings: $1,344,000

Note: Cost to city is an annual investment estimate based on the rebates given through the voluntary program. Estimated savings are utility benefit estimates based on commercial and industrial acceptance occurring over 15 years due to equipment replacement, depreciation and investment decisions.

For more information on energy savings for businesses click here.

Source: Columbia Water and Light


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Of the nearly $1 million requested, one-third of the funds have already been appropriated under the electric budget for personnel and some increased rebates. The remainder is available from previous earnings to cover the purchases of hybrid vehicles, evaluation software and expanding rebate and promotional efforts.

The Integrated Resource Plan, completed by Burns and McDonnell, Inc., estimates that energy savings from demand-side reduction through efficient capital investments could equal approximately 33 megawatts and over 1,000 gigawatts, according to the Water and Light report.

“The idea is reduce the amount of peak demand on the electric system,” Water and Light Director Kraig Kahler said.

The plan looks ahead 20 years, Kahler said. It anticipates utility usage and allows for investments to be made into certain rebates and loans for energy efficiency in commercial, industrial and residential programs.

The programs create local incentives for consumers from these sectors to install efficient energy systems such as heating, ventilating and air conditioning, insulation, appliances and lighting.

“The real savings are with commercial and industrial,” City Manager Bill Watkins said, “It’s not nearly as sexy, honestly, as going out and helping people with their energy costs, but that’s where you get the real bang for your buck.”

According to Water and Light, the commercial and industrial sectors account for over 50 percent of electrical consumption in Columbia. The highest cost-to-benefit ratios relate to lighting, heating, ventilation and air conditioning retrofits. Commercial and industrial lighting are both estimated to save approximately $1.35 million annually within 15 years.

Three expanded rebates for residential buildings include lowering air-infiltration rates ($260 per occurrence), attic insulation (18 cents per square foot) and duct sealing and insulation ($310 per occurrence of either). A new rebate offer includes upgrading single-pane windows to low energy double-pane windows that use high-performance glass, which offers a $180 rebate per window, with a cap of $580 per customer.

“As soon as consumers make investments in improving their building’s efficiency they will see savings from their utility bill,” said Kahler.

At the height of the program, these four rebates could save Water and Light $6 in utilities for ever $1 spent.

These savings require that consumers make the initial investment, something that rental property owners are hesitant to do because they do not pay for their tenants’ utilities.

Mayor Darwin Hindman suggested considering a method that has been implemented in other cities that involves a landlord incentive program. It also requires landlords to meet efficiency standards when selling their rental property or renewing rental inspection with a landlord incentive program.

“Columbia has a higher percentage of rental property, so a successful landlord program would benefit Columbia more than some other communities,” Hindman said.

Kahler believes the recession impedes consumers’ willingness to actively seek incentives that require upfront investments, but that federal tax incentives for energy efficiency and investment in DSM program rebates will counteract the economic deterrent.

“It’s what I call a virtual power plant,” said Hindman, who explained that the city’s DSM strategy saves a level of energy equivalent to a new power plant for a smaller price than it costs to build one.

The proposal must also be approved by the City Council before the programs are put into place.

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