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Be a Hero: Save Money on Energy For Your Business with Energy Rebates

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Last Updated on June 13, 2016


As the demand for energy continues to rise, utility companies are offering rebates to customers as a way to reduce usage and avoid having to spend millions to construct new plants. If you are a homeowner, you may have taken advantage of some of these rebates. What you may not know is that utility companies also offer rebates to businesses that choose energy-efficient options for construction, equipment purchases and facilities operation.

It’s no surprise that utility rates on the rise again: electricity rates are expected to increase by more than 4 percent this year, and gas prices could go up by as much as 10 percent. If your HVAC equipment is getting up there in years, now may be a good time to consider replacing older units with newer models that use much less energy than older models. You can offset the rate increases by reducing your energy usage, and you can also earn you cash rebates from your utility company.

Types of rebates available

If your business is considering new construction, renovation, or investments in new equipment, it pays to look into the rebates that may be available to you through your utility company. A recent publication by Ecova, an energy and sustainability management company, outlines several types of rebates that you may be eligible to receive:

Prescriptive energy rebate programs

This type of rebate covers the upgrade of existing energy-consuming equipment, such as HVAC systems. It’s important to check into the timing of your utility company’s budgeting (often yearly or sometimes multi-year) when seeking prescriptive rebates and apply as early as possible in that time period. Available funds can run out during the budgeting period, and when the budget is renewed the requirements for the rebate can change due to new regulatory requirements and advances in equipment efficiency.

It’s also important to be aware that rebate offerings and requirements can be dramatically different from one state to another. If you are managing facilities across a region or even nationally, you will need to research the options for each area individually, and you may need to make different purchasing decisions for each state or region to be eligible for the rebates.

Custom rebates

If you are considering undertaking a major energy-efficiency project, especially on a regional or national basis, you can win a significant windfall by negotiating a custom energy rebate from your utility company.

This option requires more work on your part, since you need to approach the utility company with a proposal and provide clear proof of your energy savings. The process will require a great deal of research and due diligence. You will need to provide detailed calculations of energy savings to the utility company both before and after the project, as well as ongoing reporting of savings measurements. The approval process can take up to six weeks, and you may have to wait a few months after implementation for the rebate check so that the utility company can verify your results. In some cases, the utility may even install monitoring equipment at your site to measure the effectiveness of the project.

However, custom rebates can offer more flexibility in terms of equipment choices and may cover new and innovative technologies that are not yet covered by prescriptive rebates. Custom rebates can amount to millions of dollars for a program covering many properties.

New construction rebates

In most cases, you need to be constructing a brand new building to be eligible for a new construction rebate (even down-to-the-studs renovation doesn’t count). You’ll need to get the utility company involved very early in the design process. They will take into account your construction materials, HVAC equipment and lighting, and rank your expected efficiency versus the local code to determine your rebate level.

Data center rebates

Utility companies have recognized the staggering amounts of energy that it takes to run a data center, both for equipment power and cooling. This is often because it’s easier to oversize the infrastructure with multiple redundancies (an option that uses much more power), than to create smaller and more precisely controlled systems that use less energy. Rebates are available for demonstrated improvements in equipment optimization, cooling and airflow optimization, and even lighting improvements.

Leveraging rebate programs can require substantial effort on your part, but bringing in significant dollars that go straight to your bottom line can be more than worth the time.

Additional resources

To learn more about the rebate opportunities that may be available to you, check out the following resources:

  • Database of State Incentives for Renewables & Efficiency (New York)
  • How to Capitalize on Billions In Available Energy Incentives, a white paper published by Ecova
  • The U.S. Department of Energy (search for Rebates for your state)

While you’re thinking about reducing energy consumption and saving money, you should also consider all the ways your old HVAC system is costing your business. Download a copy of our eye-opening guide to Calculating the Hidden Costs of Poor HVAC Maintenance.

Get the guide to understanding your HVAC System's hidden costs.