For as long as Waypoint has been in business, lighting incentives have been the bread and butter of utility demand side management programs. And they are fantastic! LED lights offer great cost savings, huge reductions on the commercial building market energy load, improved quality of lighting, and newfound controls opportunities.
Since LEDs became commercially available, their costs have plummeted by as much as 90% since 2008 for some types of bulbs. This has been wonderful for both the commercial real estate (CRE) industry and utilities, providing increasingly attractive energy efficiency investment opportunities for buildings while delivering large energy savings to utilities. There’s just one issue… LED lighting is going to become a part of commercial building code. If utilities are only incentivizing energy savings beyond code, how will they continue to incentivize lighting in the long term?
Short answer: They won’t.
Long answer: They won’t, and it’s going to be OK.
Sometimes we are so blinded by the lighting incentives that we forget all of the other efficiency opportunities that are ripe for the picking. They may not be hanging as low on the tree as LED retrofits, but they’re still within reach and savvy CRE investors will continue to take advantage of them. The following building systems comprise a large percent of commercial building energy consumption and stand to benefit from energy efficiency improvements through utility incentives:
- – HVAC: accounts for ~40% of total commercial energy use in the U.S.
- – Plug Loads: accounts for ~33% of primary energy use in U.S. commercial buildings
- – Refrigeration: represents ~7% of total commercial U.S. building use, and in supermarkets/grocery/convenience stores accounts for up to 50% of building energy use
It’s not as if utilities only incentivize lighting, that’s far from the case. It just so happens that currently, the majority of incentive program participation is lighting-related. To future-proof utility demand side management programs, the less-popular programs like mid-stream HVAC incentives, advanced power strip plug load incentives, and ENERGY STAR refrigeration rebates all deserve more attention and creativity.
Is your utility preparing for what’s next? Will you have enough savings claimed to avoid construction of a new expensive power plant? Maybe the solution is collaborating with Trade Allies to bring in as many savings as possible. Perhaps its considering Pay for Performance programs to achieve savings goals. What new ideas are you considering to drive more energy savings across your territory?