Buying Down the Cost of Renewable Energy with Efficiency: Making Money by Saving Energy and the Environment

Abstract

Energy efficiency can play a major role in the long-term viability of
any building. The technology and practices are readily available to make
a difference in both new and existing buildings. In most cases, the more
resources one consumes, the greater the opportunity for savings. If sav-
ings are reinvested in new efficiency measures, the compounding effect
over time can be dramatic. Further management practices can reduce
operations and maintenance (O&M) costs, ensuring that efficiency gains
are enhanced and maintained. Ultimately, the business becomes more
competitive. “Buying Down the Cost of Renewable Energy” encourages
a successful business plan that not only is good for the environment but
makes sound financial sense. In fact, a practical and proven method is
to start a revolving pool of funds with the savings from no-cost and
low-cost energy conservation measures. This pool is reinvested every
year in increasingly more sophisticated efficiency projects. Eventually,
the revolving savings pool becomes big enough to be the source of eq-
uity investment; which facilitates the financing of larger projects such
as combined heat and power (CHP) and alternative energy plants. Such
money pool grows the same way a wisely managed investment portfolio
does. The underlying discipline supports three key energy management
elements: (a) fiscal responsibility and financial management, (b) organi-
zational learning and (c) plant modernization or innovation.