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Of the total energy used in the United States, approximately 36 percent is consumed by the building sector. Within the commercial building sector, typically 42 percent of the energy is used in the form of electricity for lighting, heating, cooling, and miscellaneous applications. On a nationwide basis, lighting represents approximately 17 percent; cooling, approximately 14 percent; and heating, approximately 41 percent of the source energy used. Although the actual mix of energy varies widely depending on geographic location and type of occupancy (office building, hospital, school, etc.), lighting, heating, and air conditioning generally represent the largest of the energy-intensive operations in commercial and institutional buildings.

Since the mid-1980s, and particularly since 1990, certain types of energy conservation and demand-side management projects have become popular for reducing the utility costs of buildings. Lighting retrofits involving electronic ballasts, reflectors, occupancy sensors, and other forms of lighting controls have gained immense popularity partly because they can be implemented with minimal or no engineering effort and have a high rate of return. Similarly, in the heating, ventilation, and air conditioning (HVAC) area, variable-frequency drives, economizer controls, energy-efficient motors for large HVAC equipment, thermal energy storage (TES), high-efficiency chillers, and direct digital controls (DDC) have been used extensively to enhance the part-load efficiency and control of HVAC equipment. In all likelihood, the drive for reducing utility costs and achieving high energy efficiency will continue unabated through the balance of this century and beyond.

Potential Savings through Energy Conservation


For the purposes of illustration, we will consider a hypothetical “average” commercial facility. For simplicity, let us consider the simplest and surest type of energy conservation projects. We will assume a 1 million square-foot, 15- to 20-year-old commercial or institutional facility. We will consider three simple conservation projects that appear to be popular in the electricity conservation field: (1) lighting energy conservation through the use of T8 lamps and electronic ballasts, (2) lighting energy conservation through use of occupancy sensors, and (3) HVAC energy conservation through the use of variable-speed drives.

Typically, an average commercial facility would use approximately 14 kWh/gross square foot (gr. sq. ft.)/year. At a lighting power density of 2.2 W/gr. sq. ft. and a lighting duration of 3,200 hours/year, lighting energy use in the facility will be approximately 45 percent of the overall electricity use. Likewise, with 400 gr. sq. ft./ton of air conditioning and 1 kW/ ton of air conditioning equipment, the air conditioning electricity use will be approximately 8 percent. Large fans and pumps, which typically use up to 1.5 hp/gr, sq. ft., would use approximately 22 percent. Then the process loads, office equipment, small fans, and small pumps use the remaining balance of 25 percent. Thus, the lighting and large fan areas typically use 67 percent of the overall electricity use.

Next we will look at the type of lighting retrofit potential that typically is found in such a facility. If we assume a mix of one-lamp, two-lamp, and four-lamp fluorescent lighting fixtures in a ratio of 1 percent, 25 percent, and 74 percent, respectively, in terms of connected load, it can be shown that the overall number of fixtures will be approximately 17,000 to yield a 2.2 W/gr. sq. ft. T8 lamps and electronic ballasts can save approximately 9 W, 22 W, and 42 W in typical one-lamp, two-lamp, and four-lamp fixtures, respectively, using magnetic ballasts. Putting these together, it can be shown that the lighting electricity use in the hypothetical facility can be cut by at least 30 percent1 by using T8 lamps and electronic ballasts alone.

Implementation will require various material, labor, and processing resources. In the above example, under current pricing for lamp disposal, ballast disposal, new T8 lamps, and new electronic ballasts, retrofitting 17,000 old fluorescent fixtures will cost approximately $100,000 for lamp and ballast disposal,2 $140,000 for new T8 lamps, $400,000 for new ballasts, and $180,000 for installation labor. The overall project will therefore cost $820,000. Assuming an average electricity rate of $0.08/kWh, such a project typically has a simple payback period of five to six years.

Let us now consider the second sample project-namely, installation of occupancy sensors. Generally, occupancy sensors can be economically applied to a typical space that has at least 500 W of lighting load. If we assume conservatively that only 20 percent of the facility can utilize this form of control, approximately 280 kW3 of lighting load could be potentially connected to the sensors. Turning off this load for as few as two hours per day, five days per week, could save approximately 150,000 kWh/year for the entire facility. In terms of material and labor resources, a typical project of this type would cost $25,0004 in materials and $15,000 in labor costs. The overall project will have a simple payback of three to four years.

Finally, let us consider the third sample conservation project-namely, installation of variable-speed drives on the large fans. Because each facility is unique in terms of its HVAC systems, the potential for this type of project can vary significantly from site to site. However, for the purposes of illustration, let us assume conservatively that only 30 percent of the existing fan horsepower can be controlled through variable-speed drives. Modulating the speed of 20 large fans at an average fan size of 20 hp can yield an energy savings of approximately 360,000 kWh/year.4 On a facility-wide basis, such a project will cost approximately $100,000 for materials and equipment and another $40,000 for labor. The overall project would have a simple payback of five to six years.

Figure 1 presents a summary of the sample projects described above. As shown, the hypothetical facility offers the potential for a minimum of approximately $1 million worth of projects, which could save approximately 2.33 million kWh/year and approximately $186,000/year in utility costs. In terms of unit numbers, the potential may be summarized as follows:

Figure 1. Hypothetical Million-Square-Foot Facility: Sample Project Potential


  • Capital cost of energy conservation projects: $1.00/gr. sq. ft.
  • Energy savings: 2.3 kW/gr. sq. ft.
  • Utility cost savings: $0.19/gr. sq. ft./year

While the actual numbers could vary considerably up or down depending on a variety of factors, including age of the facility, geographic location, type of occupancy, and so on, it is not unreasonable to consider the above as a conservative estimate of “typical” conditions for facilities that are more than 15 to 20 years old and have not been retrofitted with energy-conserving measures.

Application to Universities


Many colleges and universities have found that improving energy efficiency on a large scale serves as a means for controlling both energy use and energy costs. They are also finding that well-organized energy management and conservation (EMC) programs can be implemented without disrupting facilities operations and, therefore, academic programs are not negatively affected.

EMC programs can provide a comfortable working and learning environment as well as a mechanism for substantially lowering institutional costs. To achieve these outcomes, the program must be integrated, flexible, and results oriented. This section provides a systematic approach for formulating and implementing a successful EMC program in a campus setting without inflicting or imposing risks on the campus academic mission or well-being of its residents.

This section will review the various necessary ingredients in a successful energy management program, including the following:

  • Elements of success
  • Strategic planning
  • Administrative steps
  • Technical steps

Elements for Success

EMC projects are not generally limited by energy technology but can be limited by the resources available to support that technology’s implementation. Developers of an EMC program can seek support from four basic elements:

  1. Management. Managers typically plan, organize, lead, and control the work of others. Efficiency is derived when input (money, people, and equipment) remains static and output increases, when input is reduced and output remains static, or when input is reduced and output is increased.
  2. Productivity. Employee productivity is involved in planning and design, interaction with and education of consultants, implementation of programs, follow-through, and monitoring of the results.
  3. Energy. The focus here is nonhuman energy-that is, energy derived as a result of the use of electricity, natural gas, oil, or coal. Nonhuman energy is as abundant as human energy when approached with rational and technically feasible solutions. Human energy can take two forms: physical and intellectual. Physical power is the amount of energy provided by a human to perform manual work (e.g., moving a mass from point A to point B). Intellectual energy is the ability to investigate, understand, quantify, predict, and stimulate. Physical power is necessary to achieve economic survival, and intellectual power is necessary for organizational survived.
  4. Information Systems. The information system is a resource that cannot be overlooked in the effective maintenance of any management program. Computers can assist in the storage, organization, analysis, and retrieval of information, thereby freeing managers from redundant tasks so that they can pay more attention to innovative solutions.

Strategic Planning

Just as for any other organizational program, strategic planning for a successful EMC program targets every step of the management process, up to but excluding program implementation. Strategic planning provides the following benefits:

  • A clear understanding of the likely future impact of a current decision
  • Better anticipation of future developments
  • Better information exchange within the organization
  • Smoother and more efficient implementation of future decisions
  • Reduction in parochialism and increased understanding of constructive conflict
  • Emphasis on ongoing planning

The strategic planning process includes recognizing and providing for the following components:

  • Organization subsystems. This is the organizational climate. Effective ways of enhancing the climate for innovative planning include (1) encouraging widespread participation in planning at all levels; (2) stressing that change is normal and is to be expected as the organization faces a changing environment; and (3) permeating the organization with planning, demonstrating that it works, and making use of it. For an EMC program, the organization should create a staff office, decentralize the profit centers within the campus, create a project team or task force, or set up a special organization.
  • Information subsystems. This is information collection, organization, analysis, and dissemination. Planning information must be current, focused on the environmental and competitive goals of the organization, and easy to access in the form in which it is most useful. In the absence of an information system, decisions are made without relevant information. Strategic databases may include, but are not limited to, legal, political, economic, technical, competitor (i.e., other universities), and internal databases and information databases about the future.
  • Decision subsystems. This system allows choices to be made in a systematic fashion during the entire planning process. The final plan represents a great number of choices that were made and eventually coordinated into the final set of choices.
  • System of plans. The final outcome of the strategic planning process is a system of plans-individual plans that are integrated to guide the organizational system. Operational (short-term) plans guide an organization for approximately one year; developmental (intermediate) plans provide guidance for one to five years; and strategic (long-term) plans provide guidance for more than five years.
  • Planning management subsystems. This process facilitates planning and consists of five phases: (1) establishing general goals-for example, defining the organization’s purpose, (2) collecting information and forecasting, (3) making assumptions, (4) establishing specific objectives, and (5) developing plans.

Administration Steps

Administration steps include convincing top management, securing personnel resources, setting policy and goals, and managing the program.

Convincing Top Management

It is essential to the EMC program’s success that top management become enthusiastically involved to the program. Several steps can be taken to foster this support. First, illustrate the historical rise in energy costs and usage as well as the increasingly limited supply of energy, both nationally and regionally. Then examine potential curtailments in power supplies, using historical data and regularly issued reports.

Second, share with top management what other institutions are doing, and expand on the success stories. Data may also be gathered from organizations in a similar field. Generally, successful organizations will prepare periodic reports in addition to a complete publication detailing the history, organization, collective and individual achievements, funding successes, and planning strategies of their EMC programs. Detailed descriptions of other cost-effective energy conservation projects that may be feasible for the institution to implement should be presented to top management.

Finally, illustrate the potential impact of various local, state, and federal regulations.

Securing Personnel Resources

Securing personnel resources and determining functional placement of personnel within the organization is one of the most important steps toward achieving a successful EMC program. The support of a continued interaction with the chief executive officer, the budget director, the planning and resource management officer, and construction/ trades superintendents will aid in coordination of the budgeting, operating, planning, and constructing of energy management projects.

It must be determined whether the energy management program requires one or more full-time management positions, whether the individuals will play a staff or line role, and to whom the individuals will report in the organizational structure. In addition, a determination regarding the need for support staff is necessary. In making these determinations, educational and technical background should be considered.

Setting Policy and Goals

Using the institution’s mission statement as a guideline, energy management policy as well as energy goals must be established. Management of an EMC program includes uninterrupted delivery of energy (and handling of emergency interruption); implementation of results-oriented energy conservation measures; and incorporation of the energy program into the everyday life of students, faculty, staff, and visitors.

Managing the Program

Managing an EMC program is no different from managing any other program; it includes five major management functions:

  1. Planning. This generally includes defining the goals of the program and how to achieve them and developing a series of small plans to integrate and coordinate the activities.
  2. Organizing. This includes what specifically is to be done, who is to do it, to whom that individual reports, and where decisions are to be made.
  3. Motivating. Motivating personnel is one of the most important management functions, as it moves employees to exert high levels of effort to reach organizational goals while satisfying individual needs.
  4. Directing. Directing includes overseeing the activities of others, selecting appropriate communication channels, and resolving conflicts.
  5. Controlling. This involves monitoring the performance of the program and ensuring that it is proceeding as planned, correcting it if necessary.

Technical Steps

Approximately 14 percent of the costs of a building with an expected 40-year life span is in the building’s design and construction; the remaining 86 percent of costs is in operations and maintenance. Most of the existing 50 billion sq. ft. of commercial and industrial space in the United States today is energy-obsolete. Therefore, it can be assumed that the facilities for which facilities managers are responsible are not nearly as energy efficient as they could be. To establish specific objectives to overcome identified deficiencies, a calculated and well-defined plan of action must be developed. The plan suggested in this section may serve as a guideline.

Energy-Technical Audit

Perform an energy-technical audit, and collect the resulting data. This includes calculating energy costs and determining which buildings have a higher than normal or higher than desired energy consumption. This step also includes identifying no-cost or low-cost energy conservation opportunities, such as repairing broken windows and cleaning dirty air handling units.

Priority List

Identify feasible energy conservation measures, and develop a priority list, based on life-cycle cost calculations, under the following categories:

  • Quick-fix projects are those that can be handled by changes in operating practices and procedures. These include simple adjustments of thermostats, delamping and relamping with energy-efficient fluorescent lamps, and equipment shutdowns as appropriate.
  • Retrofit projects are those requiring equipment and system modifications for peak energy efficiency. Retrofit items typically require funding support in the same manner as minor capital projects.
  • Major capital outlay energy projects include a variety of capital-intensive energy conservation measures. Such projects may include computerized energy management systems for scheduling, optimized starts/stops, duty cycling, load rolling and demand control of building HVAC systems, or installation of cogeneration plants.
Setting Goals

Develop an annual consumption goal that is attainable and measurable. The goal may be to conserve energy, money, or a particular resource.


Prepare ongoing guidelines and procedures on scheduling, operations, maintenance, and training. As the process proceeds, continually assess major products, services, and markets; the external environment, including government actions, social mores, politics, and international affairs; the internal environment, including strengths and weaknesses in marketing, finance information systems, and strategic planning; and competitive environments, including research and development, new product design, automation systems, and instrumentation.

Identifying Retrofits

The method used for identifying retrofits in the EMC program must be similar to that used in a full-scale engineering survey. However, checklists, reference tables, and simple calculations based on the experience of others are recommended as substitutes for the more complex analysis and measurements entailed in a full-scale engineering effort.

The purpose of the survey is to identify sound retrofit projects and provide an approximate measure of their relative merits for budgetary planning, not to develop engineering and detailed life-cycle costs. Therefore, the survey method must be simplified so that a minimum of time and resources is invested.

There are four major steps in a building retrofit identification survey:

  • Step 1: Collect energy use data. This step provides the fuel cost data necessary to calculate cost savings later in the process, as well as an overall sense of priority for retrofit projects. The fuel types accounting for the largest part of the total fuel bill should receive the greatest emphasis in planning retrofit projects.
  • Step 2: Categorize the buildings. In this step, all of the buildings at a facility should be ranked in terms of size and thus in terms of their probable proportion of energy use. Buildings should also be categorized into type based on climate zone.
  • Step 3: Identify retrofit options. In this step, reference checklists link the appropriate candidate retrofit option with specific energy systems as a function of building type and climate zone. In addition, retrofit projects already planned can be incorporated easily.
  • Step 4: Evaluate and rank retrofit projects. The energy and cost savings of individual retrofit projects are calculated, along with their associated investment costs. The options are then ranked according to the time it would take for them to pay back their investment cost.
Major Energy Conservation Measures

During the survey, certain specific areas must be evaluated. These areas can be categorized into 52 energy conservation opportunities (ECOs) commonly found in existing buildings. These 52 ECOs, as identified in Appendix A, provide the framework necessary for an in-depth analysis of the ECOs tentatively selected for implementation.

The seven different ECO groups may be arranged in order of investigation and potential implementation. These groups are prioritized according to operational reductions and primary equipment load reductions. This method of prioritization also applies to the individual ECOs within each group. The ECO groups to be considered are listed in Appendix A.

Energy-Saving Calculation Methodology

The methodology utilized by engineers complies with universally accepted engineering practices and procedures. Project evaluations are to be determined by the cumulative effect of performing numerous energy-saving options. In addition, to further improve the accuracy of the calculations, the cumulative effect must be estimated by determining the option that provides the shortest payback period, reducing the total Btu usage by its effect, applying the next option to the adjusted Btu usage total, and continuing this process through the remaining energy-saving options. This method of calculation provides the most conservative estimate of energy savings.

Utilities Master Planning

The utility master plan should consider and recommend adequate improvements to all campus utility systems. The systems that should be addressed are electricity, heating, cooling water, sewer, natural gas, telephone, computers, and instructional television.

The master plan should also address the issues encountered with the campus-wide utilities distribution to meet the needs for years to come. In addition, a sound master plan should simultaneously improve performance and safety while reducing energy use. The utilities master plan provides a road map for the future development of the campus infrastructure. Utilities projects can be phased to ensure that services are available in advance of the construction of new buildings.



The most important single element in the success of an EMC program is the people who manage it. The consumption of energy is as much a business as the production of energy, and it must be treated and managed in a business-like way. In addition to traditional management skills, the manager in charge of an EMC program must take on a number of specific tasks related to the program. These tasks are listed in Appendix B. Properly structured, an EMC can be extremely effective. Many universities have saved substantial sums of money as a result of EMC programs.

Taking an Active Role

In relatively recent years, the nation’s utilities have taken an active role in promoting energy conservation and management and have provided numerous forms of technical assistance and financial incentives. The U.S. Department of Energy and the Environmental Protection Agency have also taken an active role in promoting energy and environmental consciousness nationwide. However, more participation may be necessary at the highest levels within both industry and government to accelerate the pace at which these projects can be developed. Such additional efforts must have one simple goal: to develop a strategy by which the nation can fully tap into the economic potential offered by the energy conservation industry and use it in time to give the needed economic boost across the country.

From a facilities officer’s viewpoint, these types of conservation projects can offer benefits in a variety of ways. First and foremost, if there is a sudden need to reduce costs in the operating budget, the manager can utilize private financing to implement the projects and save utility costs. If there is a management directive to trim operating staff, the manager can justify use of such staff to start a conservation program and thereby minimize the extent of staff cuts. It is conceivable that many air quality management districts may offer a “pollution credit” for the savings produced by conservation projects. Managers should use the opportunity to get such credits, which can be either resold at a price or banked to accommodate potential facility expansion at a later date.

Whether one looks at it from a microscopic standpoint (i.e., at a single facility) or from a global or national standpoint, conservation programs can offer multiple payoffs, including making the so-called weakening job base more solid throughout the country.



1. Energy Information Administration. Lighting in Commercial Buildings. Publication No. DOE/EIA-0555(92)1. Washington, D.C.: U.S. Department of Energy, March 1992.

2. Energy Information Administration. Annual Energy Outlook, with Projections to 2010. Publication No. DOE/EIA-0383(92). Washington, D.C.: U.S. Department of Energy, January 1992.

3. Hines, Virginia. “EPA’s Green Lights Program Promotes Environmental Protection, Energy Savings and Profits.” Strategic Planning for Energy and the Environment, Winter 1990-1991.

4. Karkia, M. Reza. “Energy Conservation Projects and their Positive Impact on the Economy.” Facilities Manager, Vol. 10, No. 1, 1994, pp. 18-23.

Appendix A


Energy Conservation Opportunity Group

Group A: Operational

ECO 1. Reduce system operating hours.

ECO 2. Reduce space loads owing to ventilation.

ECO 3. Control space temperature and humidity.

ECO 4. Reduce flow and temperature of hot water.

ECO 5. Isolate off-line boilers.

ECO 6. Use low-temperature condenser water.

ECO 7. Reduce operating time of elevators.

Group B: Lighting System

ECO 8. Reduce illumination levels.

ECO 9. Use only necessary illumination.

ECO 10. Utilize natural light.

ECO 11. Improve effectiveness of existing fixtures.

ECO 12. Use more efficient lenses.

ECO 13. Install more efficient lamps.

ECO 14. Install more efficient fixtures.

ECO 15. Install more efficient, high power factor ballasts.

Group C: Building Envelope

ECO 16. Reduce transmission of heat through walls and ceilings.

ECO 17. Reduce transmission of heat through windows and skylights.

ECO 18. Reduce transmission of heat through roof.

ECO 19. Reduce transmission of heat through floors.

ECO 20. Reduce space load owing to infiltration.

Group D: Distribution Systems

ECO 21. Reduce energy consumption for fans by reducing air-flow rates and resistance to airflow.

ECO 22. Reduce pump energy by reducing resistance and flow rates.

ECO 23. Insulate ducts.

ECO 24. Insulate piping.

ECO 25. Replace steam traps.

Group E: HVAC Equipment

ECO 26. Improve control and utilization of outside air.

ECO 27. Recirculate exhaust air using activated carbon filters.

ECO 28. Use separate makeup air for exhaust hoods.

ECO 29. Employ evaporative cooling of outdoor air.

ECO 30. Employ desiccant dehumidification.

ECO 31. Reduce energy consumed by reheat systems.

ECO 32. Adjust fuel-to-air ratios of firing systems.

ECO 33. Install flue gas analyzer.

ECO 34. Replace existing boilers with modular boilers.

ECO 35. Preheat combustion air and heavy fuel oil to increase boiler efficiency.

ECO 36. Maintain fuel burning equipment and heat transfer surfaces.

ECO 37. Replace steam atomizing burners with atomizing burners.

ECO 38. Reduce blowdown losses.

ECO 39. Increase evaporator and/or decrease condenser water temperatures and modify controls.

ECO 40. Isolate off-line chillers and cooling towers.

ECO 41. Replace air-cooled condensers with cooling towers.

ECO 42. Use a piggyback absorption system.

ECO 43. Utilize heat reclamation systems.

Group F: Domestic Hot Water System

ECO 44. Insulate hot water storage tank piping.

ECO 45. Use heat recovery systems.

ECO 46. Replace central system with local heating units and/or separate summer generation of hot water.

Group G: Power Systems

ECO 47. Reduce energy consumption of equipment and machines.

ECO 48. Reduce peak loads.

ECO 49. Utilize efficient transformers.

ECO 50. Replace oversized motors.

ECO 51. Correct the power factor.

ECO 52. Utilize a central power control system.

Appendix B


Initial Assignments for the Campus Energy Manager

  1. Collect, review, and consolidate all energy and utility consumption-related data in the campus.
  2. Identify all energy consumption centers on campus, devoting particular attention to bulk consumption centers such as the central steam station.
  3. Set up annual targets for reducing energy use in electricity, gas, liquid fuel, and water on the campus consistent with the system-wide policies and programs of the campus.
  4. Identify the opportunities for optimizing energy use on the campus.
  5. Prepare an action plan to reach the annual targets.
  6. Establish an energy management team composed of representatives from facilities planning, plant operations, administration, faculty, and the student body.
  7. Review with the team the annual targets and the plan for reduction in energy use, and jointly agree to an overall strategy.
  8. Identify the energy reduction opportunities in the three categories: quick-fix, retrofit, and major capital items.
  9. Identify those energy reduction opportunities that need to be reviewed by an outside consultant, and prepare funding justification for those items.
  10. Estimate the cost of those items in item 8 that would help reach the annual campus energy reduction targets with no or low costs, moderate costs (less than $100,000), or major capital outlay.
  11. Prepare a summary of the annual plan with proper identification of the anticipated reduction in energy use, tying it to funding needed to make those reductions possible.
  12. With the energy management team, prepare project justifications and proposals for funding, and review these with the office of the chancellor.
  13. Monitor the enforcement of the building and equipment energy standards and implementation of the steps under the no-cost/low-cost category in the annual plan.
  14. Identify the bottlenecks and operational problems in the implementation of the annual program plan steps.
  15. Conduct a public relations campaign to promote the program on campus. If necessary, request help from the student body, and publicize the plan’s achievements.
  16. Prepare responses to federal and state opportunities for funding for energy conservation projects. If necessary, request assistance from members of the faculty to prepare those responses.
  17. Conduct seminars or review programs for the campus maintenance staff on preventive and energy-conscious maintenance.
  18. Review the programs of the campus energy conservation program every six months.
  19. Prepare an annual report on the energy conservation plan, activities, and performance of the office of the chancellor.
  20. Disseminate pertinent national and local energy-related news to the campus community.
  21. Prepare a monthly energy consumption report.

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