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System Impacts

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Financial Impact

Submetering can be a financially viable component of energy management by informing improved energy consumption management. It is important to remember first that submetering systems by themselves do not reduce energy use, greenhouse gases, or costs. In fact, installing, monitoring, and analyzing data will require resources such as installation, integration, calibration, and training costs. Instead, submetering should be viewed as a system that enables optimized performance and energy efficiency. Purposeful and carefully planned submetering programs generate data that can guide management strategies, investments, and operational decisions that ultimately bring about resource reduction benefits and financial savings.

Industry trends have shown that well-designed submetering systems can provide energy savings at varying levels of action. With unstable utility prices in addition to the shift toward environmentally sustainable facilities, sophisticated collection of more granular usage data continues to grow as a critical component of resource management. The table below outlines the range of possible savings from metering, which can used to gauge potential resource savings in your building.

Metering Saving Ranges - Metering Best Practices Guide (DOE)
Action Observed Savings Effect
Bill Allocation Only 2.5% to 5% Improved occupant awareness.
Building Tune-Up 5% to 15% Improved awareness and identification of simple O&M improvement and managing demand loads.
Continuous Commissioning 15% to 45% Improved awareness, identification of simple O&M improvements, project accomplishment, and continuous management attention.

The table demonstrates that integrated submeter plans yield the most benefits. Based on the level of action taken, reducing overall resource consumption through efficiencies gained by submeters can provide long-term financial benefits. Additionally, market data trends have shown that there are additional benefits to installing and maintaining a submeter program. Studies have shown that commercial buildings with lower energy usage and the capability to track tenant usage data are more desired, easier to rent, and have a higher market value as compared to buildings without tenant level metering.

Submetering systems are distinct among building retrofit investments in that they themselves do not reduce resource consumption. Their role in enabling the optimization of resource use can generate a variety of both direct and indirect benefits such as bill verification and reduced carbon dioxide emissions from resource reduction, respectfully. This makes it more difficult to quantify the lifecycle cost of submetering financially.

Still, evaluating the feasibility and impact of a submetering investment requires a lifecycle cost approach to accurately assess the long-term economic costs and benefits of implementation. Energy Policy Act of 2005 requires that Federal buildings be metered to the maximum extent practicable and the Energy Independence and Security Act of 2007 calls for the value and effectiveness of any energy-related investment be evaluated against its cost effectiveness.

GSA published a helpful guide on how to calculate cost-effective solutions in the building context for submetering. Read it to learn more about making the business case for submetering investments.

A submetering system enhances building performance and resource use of existing building systems (see System Bundling).

Meter costs can be grouped into three main categories: equipment costs, labor costs, and recurring costs. Since submetering systems can vary greatly depending on the functionality of the system, the building type, and the building’s condition, these categories are intended to provide a broad summary of the costs associated with implementing and maintaining a submetering system.

  • Equipment costs include the cost of the hardware and software needs for data collection and analysis, as well as any additional supporting materials needed for installation.
  • Labor costs include the cost for a team to install the submetering technology within a building, connecting the submetering system with new or existing building systems, testing, and inspection.
  • Recurring costs include the ongoing operations and maintenance of the submetering program as well as the energy management software and information technology changes/upgrades.  Meter calibration and staff training costs also need to be considered since they can result in significant recurring costs if not carefully planned into projects.

Please refer to chapter 3.5 of the Metering Best Practices Guide to learn more about meter costs.

Findings and Case Studies

EPA Sub-Metering Energy Use in Colleges and Universities: Incentives and Challenges

  • Due to the energy conscious behavioral incentives made possible by the granular level of data provided by submetering, the school reduced energy consumption after 18 months, saving $300,000 per year
  • Submeters aided in identifying operational procedures that resulted in wasteful practices in energy intensive departments at the school
  • Aids in the prioritization of energy retrofit projects
  • Estimates savings of about $1 million per year for 10 years

Department of Energy EERE Nissan North America

  • Granular submeter data helped staff identify opportunities to adjust production schedules for optimal energy use
  • Identification of inefficient equipment use or sequencing that provide little output value or have inefficient on/off cycling
  • Optimized equipment usage
  • Improved plant staff knowledge about equipment responsiveness to weather conditions, enabling predictive production plant adjustments

Vornado - New York City Office

  • Data from 3,000 submeters was transmitted to the remote terminal units, yielding over 105,000,000 records of energy usage across Vornado’s portfolio within 5 years
  • One tenant realized a 15% reduction (i.e. reduced over 2,000 kWh per day during the weekdays and slightly more during the weekends) in overall electricity consumption from resulting adjustments requiring no capital investment within a short amount of time 

Wayne Aspinall Federal Building

  • Explores the energy-efficiency design features of the Wayne Aspinall Federal Building and U.S. Courthouse in Grand Junction, Colorado.
  • Learned to monitor resource use through the use of circuit level submetering integrated with the BAS system.