New Utility Bill Cost Solutions Eliminate Direct Capital Expenditures

Utility bills can make you as frustrated as a termite in a petrified forest.  Businesses and organizations would love to avail themselves of any and every energy efficiency program that is available in the marketplace. Yet; every year, it’s the same old snag: “It’s not in the budget!”  In order to fully understand the scope of the problem, let’s examine the cost components of Utility bills, beginning with electricity.

Electricity bills are made up of two components: 1) The meter side which consists of any cost element pertaining to the rate itself, the meter, and billing, and 2) The demand side which consists of everything at any facility that consumes electricity. This includes, but; is not limited to the following: lighting, heating/ventilation/air conditioning (HVAC), inductive energy equipment (i.e. boilers, chillers, pumps, cooling towers).

In regards to the meter side of electricity bills identifying energy industry professionals who are willing to work on a performance-based shared benefit basis is difficult, because since they do all of the work, if they don’t find any past or future savings, they may have spent hundreds of hours for nothing, while providing whomever retained their services with a free audit of their bills.  On the other hand, this is generally not the case and can unearth opportunities that would never have been uncovered, such as errors in metric unit conversion, double-billings, and phantom-billings.

Conversely, in regards to the demand side of the electricity bill equation, retaining the services of a performance-based shared benefit energy industry professional has a greater likelihood of success if they can facilitate cost reduction on an ongoing prospective basis.  This can include being able to obtain commercial lighting, HVAC, and even solar panels without any direct out-of-pocket capital expenditures whether a business or organization owns the building that is housing its facilities or is being billed by the Utility company and leasing the facilities it resides. How is that possible?

Energy efficiency commercial businesses have also recognized that their sales have been stymied by the same problem that their Clients have been telling them for the past several years: “It’s not in our budget!”  So, these entities have decided to “take the risk” of deploying their equipment to businesses and organizations and billing them on a subscription basis, just like your Cable-TV provider bills for their services.

So, these energy efficiency subscription services eliminate the dollars and cents systemic problem of not having enough money in the annual budget to implement immediate Utility cost reduction.  For example, in HVAC cost reduction, whether the facility has rooftop of ground-mounted systems, the cost savings can also apply to any walk-in cooler or refrigeration unit that the facility has on its premises.  Once the information has been evaluated by the energy efficiency subscription service provider, a site visit is scheduled to confirm that the percentage (%) cost savings can be obtained.  Then, if the cost savings projections are verified, the Client receives their subscription Service Agreement.  In cases where the Client is leasing its commercial space, all they need to do is to have their Landlord sign a waiver, which is in their interest, as the subscription is assumable.

Savings in Natural Gas expenditures can also overlap in savings for other Utility costs. For example, a Co-Generation system, which is a Natural Gas Generator that converts  Natural Gas to electricity, can also be obtained on a subscription basis.  This solution not only reduces Natural Gas costs, as Co-Generation systems receive a favorable rate from Utilities since they are creating additional capacity for the electric grid of the Utility; more importantly, it creates significant cost savings on electricity.  And, in cases where the Client is a health care facility, hotel, or a school, the waste heat from the Natural Gas generator can be used to heat the water of the facility.  Or, in the case of a facility that purchases its steam, a similar solution, called a Tri-Generation system, can eliminate the entire steam bill costs in the same manner.   Most Co-Generation systems have the ability to also act independently of the Grid, allowing mission-critical businesses and organizations to know that they will be able to continue to operate during power outages.

A different problem exists with regular Diesel and/or Natural Gas Generators that primarily in the Northeast and Midwest in that there are new EPA Regulations in place in regards to air pollution that require them to upgrade their catalytic equipment.  For these entities, they may be able to have all their costs paid for by an energy efficiency hosting solution where their equipment is upgraded, saving them tens of thousands of dollars, while creating a new revenue stream for them in the monies that the hosting Company receives from the electrical Grid operator in creating additional capacity for the Utility.

This new type of energy efficiency hosting solution can now be applied to commercial solar installations. In other words, in certain States, if a business or organization, whether it be an agricultural farm, landfill, or religious institution, can qualify to be the host site of a commercial solar array. And, get paid a monthly fee from the energy efficiency hosting Company. They even have the option of reducing their own electricity cost.  This solution is particularly attractive, for a multi-family apartment building, where the hosted solar array can actually reduce the individual apartments of the tenants of the building.  The same would be true of a Home Owners Association (HOA) or Condominium Association.

Utility cost savings can also apply to water and sewer costs, such as laundry technology that saves on water, sewer, natural gas, and electricity costs.

With traditional energy management consulting firms, they are either retained on an hourly basis or a Project basis that can run tens of thousands of dollars.  Alternatively, engaging the services of performance-based energy professionals, there is no risk since if you do nothing, you will continue to pay what you are paying now for your electricity, natural gas, and water and sewer bills.  With utility bills constantly on the rise, procrastination can get awfully expensive.


Ron Feldman
Ron Feldman
RON has been recognized by Who’s Who In California and Who’s Who In Lodging. He has taught Business Services Marketing at the Undergraduate and MBA University levels. Feldman holds an undergraduate degree in Mass Communications, as well as a Masters Degree in Educational Psychology. Feldman previously had been retained as a consultant twice by a major publicly traded NYSE payments industry company to re-engineer their order processing, and restructure their telecom costs, as he had done for the Clients of the second largest Utility Auditing Company in the World. He has saved businesses and organizations millions of dollars in performing Utility Audits, since 1994. He was also retained by another NYSE Retailer to advise them in regards to their payment solutions for their customers. Feldman received a U.S. business method patent for a transaction processing technology focused on the hotel industry that he invented while working with Citicorp in developing their global multi-party settlement system in the late 1980’s. During that era, Feldman worked with SITA/Sahara, a global Internet-based organizations of airlines and hotels, and was formerly Vice-Chair of the Association of Travel Marketing Executives. Feldman has represented the United States in the World Championships of Tournament Bridge in 1982, 1986, and 1994. He founded the first accredited organization of Professional Bridge Players. Feldman also served on the National Conduct and Ethics Committee of the American Contract Bridge League (ACBL), as well as its National Marketing Committee. He resides in Petaluma, California in the Sonoma Wine Country.

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