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Energy Efficiency: the Hidden Benefits

July 24, 2014 By Marc Karell

Marc Karell

I was fortunate to have been the construction and environmental manager for the largest conversion from No. 6 oil to natural gas so far in NYC. Three large boilers, providing heat and domestic hot water for 8 high-rise apartment buildings and other areas, were upgraded in preparation for the fuel switch.

It is now two years since the switch was implemented, and I was asked to estimate cost savings for these two years compared to the last two full years of full No. 6 oil service to determine cost savings. Well, between the improvement in thermal efficiency and the price difference between natural gas and oil, the building owners saved millions of dollars per year compared to before the switch, despite the fact that the last two winters were colder than the earlier two under No. 6 oil (in terms of heating degree-days). The payback for this multimillion dollar project will be under three years. It is being hailed as a success. The client is happy.

But it turns out that the client has achieved other benefits it did not expect. By switching from No. 6 fuel oil only to natural gas with No. 2 oil as a backup, they have far fewer oil deliveries. Before the upgrade, the boilers were combusting over 2 million gallons of No. 6 oil per year. Trucks used to travel through the narrow neighborhood streets to deliver oil approaching well over 200 times per year. Every time a truck arrived at the boiler house some workers had to stop their work and help the truck driver load the storage tanks. Now, with No. 2 oil as a backup, in the first year of operation there were only two truck trips all year. Only twice workers were interrupted from other tasks to help unload.

Shifting from 200 to just two deliveries has caused stress to decline and productivity to rise at the boiler house, not to mention decreased traffic and congestion in this urban neighborhood. Plus, boiler house costs and time devoted to maintenance have decreased. Natural gas is easier to manage compared to viscous No. 6 fuel oil, which itself has to be heated just to flow. Pumps, valves, and other equipment had been taken out of service and
cleaned and serviced much more than they need to now, improving efficiency among the staff. The new automated control system has also saved staff time.

Finally, the switch to natural gas substantially reduced the risk of a calamity. Despite robust training, there was a risk of No. 6 fuel oil leaking from some overburdened piece of equipment, causing preparation for such a calamity and the potential tremendous cost involved in removing and cleaning this viscous fuel. Now with natural gas piped in and less No. 2 oil handled and a new modern tank farm, the risk of a spill and the potential cost if one were to occur are both much lower.

This housing complex’s switch to natural gas for its heating needs has been a big financial winner for them, not only in terms of efficiency and direct cost savings, but also in terms of these less visible, but yet critical additional gains in operational improvements.

Marc Karell is the owner of Climate Change & Environmental Services. CCES has the experts to help you evaluate all of the advantages of a fuel switch or other energy upgrade to save you money and aggravation, as well as reduce risk. We can also manage its implementation to completion and assess your overall gains. Contact us today at karell@CCESworld.com or at 914-584-6720.



One comment on “Energy Efficiency: the Hidden Benefits

  1. Excellent job! While difficult to quantify this type of data in an initial proposal to a client, these are facts that can’t be ignored. Their return on investment was probably much sooner than planned for and their greenhouse gas emissions also reduced more than planned. Nice case study.

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