Do You Understand Your Energy Bill?
By Chuck Sathrum
It's ironic that most folks will go over their cell-phone, cable-TV and credit-card bills with a fine-tooth comb but simply shrug their shoulders and pay the electric and other utility bills. This isn't only the case for residential customers but also for large commercial and industrial enterprises. I work with many public-sector entities, such as state agencies, universities, community colleges, and local county and municipal governments, to help them examine their energy use. Most of them assign someone to be in charge of telecom budgets at the $100,000 level but often have no energy manager when their utilities costs exceed $10 million.
The bad news is we have little control over the unit cost of energy and water. However, understanding our bills provides us with a level of control. When you receive your bill, you assume the utility is correct, but you shouldn’t. Always look for billing errors. A university, for example, can have multiple campuses with more than 100 electricity accounts and several gas accounts. Generally, utility accounts are associated with meters; one meter may be connected to several buildings. A classic billing error occurs when one of the buildings associated with a meter is leased and the institution unknowingly continues to pay the electricity bill for the leased building. Another error may occur when an organization is recognized by the utility under several different names, such as North Carolina State University, North Carolina State, State University of North Carolina, etc. Other errors may arise when meters break or decimal points are placed improperly. One of our state agencies was refunded more than $280,000 when finding such errors.
Organizations also should determine whether they're on the proper rate schedule. A rate schedule is how much you pay for your electricity; it can be time or quantity dependent. It costs the utility different amounts to create electricity at different times. In summer when there are many cooling-degree days, the utility must turn on peaking units to meet demand. For example, a factory that makes semi-conductors may agree to a Time of Use Plus Demand rate schedule. The factory agrees not to use more than a certain level of power at a certain time. It still has to make semi-conductors, but if the utility tells the factory a day in advance to drop load by 1 MW between 2 and 3 p.m.--and the factory can safely reduce “non-mission-critical” loads--the utility will provide a lower rate. If the factory violates this, it will be penalized. A university we oversee saves nearly $1 million per year because it reviewed rates for a couple days and determined there was a better option.
You also have major control over your consumption. If you are a residential customer, you are the energy manager. Go to your electric utility’s Web site and learn how to read your bill. Any enterprise with more than $1 million in annual energy expenses should hire (not simply assign) an energy and water manager. A job description for this position may include the following and more:
• Develop and implement energy policy.
• Raise and maintain energy awareness throughout the organization.
• Identify opportunities for increasing energy efficiency through lighting, computers, office equipment, building envelope, HVAC, water, kitchen and vending machines.
• Reconcile, verify and approve for payment invoices submitted by metering and field-services providers (electrical, water, sewer, fuel oil, LP gas, etc.).
• Optimize the efficient energy use and cost at facilities through the review and analysis of utility consumption information and operation data.
• Manage budget for utilities and capital expenditures to achieve maximum return for investments to enhance, upgrade or develop energy-conservation programs and systems.
• Stay informed about current technologies and trends to conserve energy and reduce consumption through the design and construction of buildings and building infrastructure.
Hiring an energy manager is the best investment you can make, paying for itself many times over.
If you are looking to make immediate changes to the energy consumption of your home or business, I recommend you first contact your utility account representative and ask the utility to do an energy assessment. In some cases, the utility will have an online self-audit that asks what types of light bulbs you have in place, whether your building is well insulated, if you utilize programmable thermostats, how often you clean HVAC filters, etc. Don’t forget water. Most of the money associated with water is in heating, cooling, boiling or freezing it for your needs. Minimizing water use can dramatically impact your energy-cost savings. Between American Recovery and Reinvestment Act of 2009 funds; utility rebates and incentives; federal, state and local incentives; and tax credits, there has been no better time to improve energy efficiency.
Chuck Sathrum is a program manager at the North Carolina State Energy Office, Raleigh, NC.