Fitness facilities use lots of energy, as your utility bill can attest. Running one inefficient light bulb for a year equals $100 wasted. If you have 500 light bulbs, that's $50,000 wasted. If you upgrade your mechanical systems, lighting and electrical systems, you not only will be greener environmentally, but you also will save money. However, given the economy, you may ask how you can afford the upfront costs to become energy efficient. I'd say, how can you afford not to be green?
That's where incentives come in. Your local utility companies — as well as federal, state and local governments — want to conserve energy since none of them want to build expensive power plants. They will offer you rebates, grants, tax credits and incentives so you can upgrade your facility. These incentives, worth anywhere from 30 percent to 100 percent of the total cost of the upgrade project, are free for the taking.
Literally hundreds of federal, state and local programs can help subsidize the cost of improvements. Most of these programs are based on improving your building's overall energy efficiency. In many instances, improving on your current efficiency factor will be the main requirement to receiving this money. So many programs are out there with varying degrees of paperwork involved and performance baselines that it's easy to become confused or overwhelmed before you even start. Numerous agencies and entities can help you navigate this process. You can get direct rebates by calling your local utility company or using third-party, nonprofit groups to assist you.
To help coordinate this process, I advise my clients to assign this task to one of their staff members and treat it as an important revenue-producing project.
So where can you find out what incentives and rebates are available? A great place to start is the Internet. One of the best Web sites I've found is called DSIRE — the Database of State Incentives for Renewable & Efficiency, funded by the U.S. Department of Energy's Office of Energy Efficiency and Renewable Energy.
DSIRE is a database of available incentives offered in a state-by-state grid. It dictates the type of incentives from local to state, federal and private, plus how many incentives, and from where the money comes. The incentives can be in tax credits, outright rebates, grants, loans, etc. Simply click on one of the incentive keys in your state, and a detailed explanation will pop up, including how much is available, plus any contact information.
Consultants can make the search process even easier. Marina Rose, an energy-efficiency specialist for Ecology Action, a nonprofit environmental consultancy delivering program implementation for the San Francisco area, helps companies evaluate, document and contract for upgrades. Essentially, her organization reviews your usage, equipment and bills — not only to recommend an action plan but also to make it happen.
“All the owners have to do is sign the paperwork and allow the contractors access to the work. It's essentially free money with a payback of usually under a year,” Rose says. “You'd be surprised that my biggest barrier to doing this for people is that they think it's a scam. That's when we bring in the utility company to assure the business owners [that] it's not, and it is money that they are entitled to and have essentially paid for through their taxes.”
Ecology Action will help facilitate the job, from calculating potential energy savings and rebates to getting quality contractors to do the work. For example, Rose worked closely with a large Bay Area health club to retrofit its old inefficient lighting system. The cost to do the work was $18,000. The rebates totaled $14,500. So the club owner's out-of-pocket expense was $3,500. The annual savings for the club in energy cost was $33,000. In five years, that club owner will make a profit of $161,500. Keep in mind that was just for lighting upgrades. Some business owners have saved more than $20,000 a month for whole-building efficiencies.
As they say, you have two ways to make money in business — by adding profit or by cutting expenses. Any way you look at it, being energy efficient is a long-term money maker. With all these available resources and incentives, being green has never been easier or smarter.
Editor's Note: This column was originally published online as a Step by Step column. It has been adapted to fit our print space constraints.
Rudy Fabiano, a registered architect and interior designer, is president of Fabiano Designs, an architectural firm for health clubs, wellness centers, sports clubs and spas. The company has produced more than 400 projects in the past 20 years.