2 FM quick reads on energyefficiency
1. Focus on Motor Efficiency to Find Savings
Motors and the loads they drive represent some of the largest energy users in institutional and commercial facilities today. With many of these loads operating 24 hours a day and 365 days a year, facility managers looking for ways to improve their facilities' operating efficiency are focusing their attention more often on their facilities' motors, where even a small increase in efficiency can result in significant savings.
Today's new-generation motors are quite different from most motors installed in facilities. Improvements in their design and manufacturing have resulted in improved operating efficiencies.
One factor driving this improvement has been mandatory standards for motor performance. The Energy Independence and Security Act of 2007 established the minimum performance standards for a range of motors commonly found in facilities.
As manufacturers have improved their processes by using higher-quality materials and manufacturing techniques, many of the motors available today go beyond these minimum standards. As a result, managers have access to an expanded range of premium-efficiency motors.
Although these motors cost 10-15 percent more than standard-efficiency motors, managers can recover the additional first costs through energy savings, particularly in applications where the motor runs for more than 4,000 hours annually. Managers can expect to achieve a simple two-year payback. In most applications, operating efficiencies will increase 2-8 percent.
The first step for managers trying to determine the best application of premium- efficiency motors is to develop a plan that phases in upgrades of existing motors.
The first step is to identify all motors in the facility. For each motor, record nameplate data, including the motor's horsepower (hp), operating voltage, and operating speed. If the motor is a constant-speed model, measure and record its amperage and power factor, and identify the load it drives and the hours it operates annually, noting if the load is constant or variable.
2. EPAct Section 179D Deadline Is December 31, 2013
Facility managers planning energy efficiency projects should circle Dec. 31, 2013 on the calendar. Under current law, that's the last day that a project can be put in service and qualify for tax deductions under EPAct — the Energy Policy Act of 2005.
EPAct tax deductions — also known as Section 179D deductions — can be as high as $1.80 per square foot for projects that meet IRS requirements. If a project doesn't qualify for the full deduction, partial deductions of 60 cents per square foot are available for lighting, HVAC and the building envelope.
Savings may be significant. Green Leaf Paper installed T-8 lamps and occupancy sensors in an 80,000 square foot warehouse, says Marky Moore, CEO, Capital Review Group, at a cost of about $45,000. The project earned a utility rebate of $23,131. The EPAct tax deduction was $24,869, based on 60 cents per square foot minus the rebate. "The deduction is applicable to the 'net' cost," says Moore in an email. "The 'net' cost is the cost less any rebates, credits or other incentives. In other words, anything that reduces the asset basis."
A growing number of facilities are taking advantage of EPAct deductions, says Charles G. Goulding of Energy Tax Savers. He cites the Raritan Center Business Park as an example. Many facilities in the park are owned and managed by Federal Business Centers. A concerted energy efficiency upgrade effort was launched in 2009 to further modernize buildings and increase building efficiency. Federal Business Centers used a combination of energy cost reduction, New Jersey Smart Start Utility Rebates and EPAct Federal tax savings to support retrofits. More than 3 million square feet of space has been upgraded with T8, T5, induction, and LED technology, and approximately 2 million square feet of space has been upgraded with energy-efficient natural gas heating units. Federal Business Centers has received more than $800,000 in EPAct deductions, according to Ray Willer, president of RFW Clean Energy Consulting.
It's possible that Congress will decide to extend the deductions into 2014 and beyond. But given the concern over deficits in Washington, facility managers who can get a project into service by the end of 2013 might be wise to do so.
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