ACHIEVING COMMON AREA LIGHTING SAVINGS IN …...estimation, the 4+ multifamily market in Wisconsin consists of 456,000 units, with 432,000 of these units eligible for a standard multifamily

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ACHIEVING COMMON AREA LIGHTING SAVINGS IN MULTIFAMILY HOUSING

JANUARY 2017

Brody Vance

ACHIEVING COMMON AREA LIGHTING SAVINGS IN MULTIFAMILY HOUSING JANUARY 2017

FRANKLIN ENERGY SERVICES, LLC • WHEN EXPERIENCE MATTERS PAGE 1 OF 4

It’s difficult to generate high participation in Residential Multifamily Programs. Property owners and managers can be hard to identify and difficult to reach through marketing efforts. So, when we do have these customers’ ears, it is crucial to be able to offer opportunities for participation that are hard to refuse. These ‘can’t lose’ opportunities are often the foundation on which to build even greater energy-savings projects. That’s the reason a lot of the programs revolve around direct install measures.

But there’s another bright idea: common area lighting retrofits.

WHY COMMON AREA LIGHTING UPGRADES?No-cost direct install measures are the most common foot in the door or can’t lose opportunity used in multifamily energy efficiency programs. Measures typically consist of simple in-unit upgrades, such as water efficient bath and kitchen faucet aerators and showerheads, or light bulb replacements.

These measures keep tenants happy at no cost to the building owner and represent a significant perk for any property owner. The measures present a win-win scenario, since tenants realize savings and property owners tend to see better retention. Yet, direct install measures are usually installed in the residential units and don’t add value to the property’s shared spaces. Nor do they help the individual property owner reduce much of his/her costs. Common area lighting solutions can be a powerful complement to a more traditional direct install component.

WHO IS BEING TARGETED?Individually owned properties (typically 4 to 19 units) are the most difficult multifamily rental market segment to attract with energy efficiency programs. One contributing reason can be the lack of dedicated maintenance and/or onsite management. Another reason is limited funding and availability. With limited time and funds and a long to-do list competing for these same resources, energy efficiency upgrades are often relegated to piecemeal projects done bit by bit, when time and money permit. So, despite a significant return on investment, property owners/managers are reluctant to participate unless the program requires no out-of-pocket cost and the work is performed by someone other than their own staff. Common area lighting solutions are not no cost, but if done right they can be configured to present an opportunity that is hard to refuse for even the ‘mom and pop’ multifamily property owners.

BUILDING THE PROGRAM Common Area Lighting Solutions (CALS) simplifies participation for utility customers and for the lighting contractors. The list of eligible measures is limited to those most likely to be installed in multifamily common areas. A co-pay for all customers makes the program easy for contractors to understand and explain to customers. Because the co-pay will buy up to (for example) $2,500 in lighting upgrades, the customer is inclined to install more equipment and the program becomes an easy sell for the contractor. In some cases, common area lighting solutions become the leader for larger projects, so the building’s lighting is consistent in age and quality. Everything is transparent, reasonable and no shopping around is necessary.

Common area lighting solutions depend heavily on contractor participation. Program success often boils down to educating these contractors. Building a contractor network takes time. Repeated, consistent messaging and the right marketing plan is critical to program success. On the customer side, contractors



eliminate 95 percent of the paperwork for property owners. That is enough to turn any skeptical lighting contractor into a cheerleader and any utility customer into an energy saver.

CONCLUDING TAKEAWAYSCommon area lighting solutions can easily be integrated into a multifamily program. Proper structuring of the program lends flexibility necessary for changing markets, new technologies and program budgets.

PROOF IN AN EXISTING PROGRAMSince 2001, Focus on Energy has offered energy efficiency programs to the 4+ unit multifamily market. For many years program offerings consisted of direct install, along with typical prescriptive and custom measures for both existing and new construction projects.

Over time, the program generated an established and engaged market. Yet, there were still many parts of the market that did not participate either because of lack of awareness or because they did not see energy efficiency to be a high spending priority. To generate additional energy savings, the Focus on Energy program looked for ways to expand into these more difficult to reach markets.

For Wisconsin, multifamily housing consumes approximately 2.4 percent of electricity, and 4 percent of end-use natural gas. By estimation, the 4+ multifamily market in Wisconsin consists of 456,000 units, with 432,000 of these units eligible for a standard multifamily energy efficiency program. Although two-thirds of eligible units were built since 1970, it cannot be assumed they are lit by energy efficient equipment.

Focus on Energy came up with the idea of a Common Area Lighting Package (CALP) as a way to generate additional customer and contractor participation in the multifamily program. In preparation, the team estimated the savings potential by randomly pulling the data of buildings that had previously participated that had 4-24 units and no onsite offices.

The lighting assessments on file showed a large sample of 2-lamp T-12 linear fluorescent fixtures, incandescent wall and ceiling mounted fixtures, as well as incandescent exit signs. Most laundry and community rooms used only an on-off switch for a control. These results indicated that there was significant savings potential in the concept.

Next, the team defined the lighting solutions to be offered, determined a fair co-pay and established a fixed price per lighting fixture installed. Participating customers could choose from a trusted contractor network and from six types of lighting fixtures and controls. They also had the option to upgrade to higher end finishes, etc. on the different equipment by paying the difference in price. If a customer needs rewiring or additional services, it is up to them to pay the added cost. This provides an opportunity for the contractor to upsell the project.

The 4+ multifamily market in Wisconsin consists of 456,000 units, with 432,000 of these units eligible for a standard multifamily energy efficiency program.



During the planning process the team also surveyed lighting contractor sample groups with questions about the CALP fixed pricing concept. The questions asked addressed their customer experiences, suppliers and product suggestions. All Trade Allies surveyed rated the concept favorable and were eager for a launch. The contractors felt that their customers make decisions easier and faster with a simple set of options and a fixed co-pay that doesn’t change.

After a delayed start the first year and a few adjustments, program results flourished from the addition of CALP. In 2014, participants saved 2.5 million annual kWh, totaling a projected 26M gross lifecycle kWh. The CALP offering brought in 18% of the total Multifamily Energy Savings Program portfolio kW savings, 28% of the annual kWh savings, and 32% of lifecycle kWh savings. In 2015, savings increased to 3.7 million annual kWh and 40.6M lifecycle kWh. CALP made up 15% of the total Multifamily Energy Savings Program portfolio kW savings, 24% of the annual kWh savings, and 25% of lifecycle kWh savings.

Lighting contractor businesses are also growing in response to the success of CALP. In the pilot year (2013) only three contractors completed projects. In 2014, eight contractors completed projects and in 2015, 10 completed projects. The engagement and satisfaction of participating contractors is a critical component of CALP success since they have relationships with many smaller property owners and can bring leads to the program.

CONCLUSIONThe Common Area Lighting Package was conceived to stimulate both contractor and customer interest with a simple, straightforward package of lighting measures for multifamily properties. In four years the CALP efforts have resulted in a significant proportion of the multifamily program’s energy savings.

In 2015, savings increased to 3.7 million annual kWh and 40.6M lifecycle kWh.



CFL Fixture, Exterior, 12 Hours, CALP

CFL Fixture, Interior or Exterior, 24 Hours, CALP

CFL Fixture, Interior, 12 Hours, CALP

LED Fixture, Interior, 12 Hours, CALP


LED, Exit Sign, Retrofit, CALP

Linear Fluorescent, 2L 4’RWT8 Replacements, 12 Hours, CALP


Occupancy Sensor, Fixture Mount, <=200 Watts, CALP

Occupancy Sensor, Fixture Mount, >200 Watts, CALP

Occupancy Sensor, Wall or Ceiling Mount <=200 Watts, CALP

Occupancy Sensor, Wall or Ceiling Mount >200 Watts, CALP

31%13%

1%

10%

5%

24%

1%10%

5%.4% 1%.3%

2015 % OF KWH SAVINGS BY MEASURE

CFL Fixture, Interior or Exterior, 24 Hours, CALP


LED, Exit Sign, Retrofit, CALP


Linear Fluorescent, 2L 4’RWT8 Replacements, 24 Hours, CALP109.3

75.9

28.5

4.826.3

2015 KW SAVINGS BY MEASURE

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ACHIEVING COMMON AREA LIGHTING SAVINGS IN …...estimation, the 4+ multifamily market in Wisconsin consists of 456,000 units, with 432,000 of these units eligible for a standard multifamily