Why Utility Audits Make Sense

Utility Bill Audit

Who likes getting unexpected discounts when shopping, finding money in the street, or getting a tax refund in the mail? If you answered “I do!” to any of these, then read on!

In the most basic terms—Utility Data Audits are done to make sure you’re being charged the absolute minimum price for your utilities. They are the first step to data optimization! Unfortunately, most of the population doesn’t know much about their Utility Bills— is all of the data correct? Does it contain billing errors? Is the bill too high? Are you missing out on credits or savings? These Utility Data Audits will answer those questions for you. On a small scale, people could be overcharged and never notice it. But even if it’s just a dollar every month, it eventually adds up over time. This is especially true for those who use large quantities of Utilities, such as Hospitals, Large Corporations, Universities, or Apartment buildings— a Utility Data Audit is mission critical, and can produce hundreds of thousands of dollars in savings.

Although it seems like this kind of thing could be done in house, it’s extremely complex and requires thorough knowledge on local tariffs and regulations, as well as some really in-depth equations. To get your absolute maximum savings, you can just leave it to the experts! Most people you ask in the industry will tell you, contingency based audits are always best, because if no money is found, then nothing comes out of your pocket. That’s why even if you do handle your own audits, there’s no reason not to have someone double checking for anything that was missed!

In addition to just finding money that you’ve overpaid in the past, Utility Data Audits are also a great way to identify operational inefficiencies—even if you’ve already implemented energy efficiency projects— these audits can tell you if they are truly delivering the anticipated results. The data that is collected holds the key to determining the true value actually being created.

So to sum it up, Utility Data Audits truly do make a lot of sense. It’s important to know where your hard earned money is going. This is an inescapable expense for all, it’s time to learn how to generate value from it!

Why Retrofit?

Retrofit

It is becoming more evident than ever that technology is increasing and developing. Whether it be the electronic industry, automobile industry, or the utility industry for examples – advancements are always being made. This is true so much so that there always seems to be some sort of update, upgrade, or reconstruction that is suggested we download or apply in order to improve some aspect of the overall entity. This is essentially what retrofitting is. Though not necessarily appropriate when referring to things such as software or downloadable updates – retrofitting is ultimately this same concept in a more physical way.

The definition of retrofitting is more similar to that of refurbishing or renovating. Refurbishment is geared towards enhancing the overall quality of a product and usually includes improvements to different amenities within a space.  Renovations are almost always used in reference to cosmetic or structural upgrades to a building or property. Retrofitting falls somewhere in the middle.

To retrofit is to add a component or addition to something and because of the size, cost, and permanency of most building systems (water, electric, and gas), a retrofit serves as the best option for building owners to keep up with the different technological advances within the utility industry. Advantages of retrofits can be plentiful as they provide older buildings with the ability to be as up-to-date and modern as those that are brand new in the least costly way possible. A good example of this is the process of retrofitting a business or home’s lighting system.

Instead of replacing entire lighting fixtures, many consumers find replacing their current bulbs with ones that are LED is easier and more efficient regarding laboring costs and time. Some states even offer programs to offset expenditures used for energy efficiency. Research done by Energy Star, the government’s certification program for high-efficiency products, has shown that every dollar spent on energy efficiency within a property has the ability to increase its value by three times. It is in this way that retrofitting serves as the best way to increase return on investment (ROI) with regards to energy efficiency.  Improving properties is also getting even easier with the increase in companies producing retrofitting products. Products such as Roost,Switchmate, and Ambi Climate are all newly launched retrofit gadgets that allow one to utilize their smartphone in order to control smoke detectors, lights, and AC/heating units!

Retrofitting products come in all shapes and sizes. They can be as easy as personally buying and installing low-flow showerheads or as complicated as bringing in an auditor and contractor to assess the situation. As these solutions get more complicated, retrofit kits are even available for purchase by consumers. Utility Relay Company for example offers retrofit kits for outdated and less efficient circuit breakers

Though retrofitting is ideal, it is not always the most feasible or practical. Some items to consider when looking to apply retrofits are location, maintenance, impervious or pervious areas, and the social environment in the area. These should be especially considered within more metropolitan areas. A more in depth look at the challenges regarding retrofitting can be found here and details regarding a larger and broader retrofitting process can be found here.

Big Data in the Utility Industry

The-Big-Risks-of-Big-Data-MiningThe amount of data that is now at our fingertips is consistently increasing and so are the analytics required to reap their benefits. This trend is expected to continue as the digital atmosphere is projected to be 44 times larger in 2020 than it was in 2009.  This means that not only are we able to store more data as a whole, but that this data in almost all cases will continue to get more detailed – leading to more specific and more effective results. These results can be used for almost anything from creating more innovative operation strategies, to better reaching consumers, to even predicting the “next big trend” within your industry. The utility industry is not exempt from this Big Data expansion and in fact has the burden (or blessing) of having an overwhelming amount of data to deal with.

As our previous blog mentioned, innovation with regards to smart technologies and efficiency will soon be affecting the ways in which we produce, harvest, and share our electricity. Within these advancements will also come the ability for utility systems to produce and distribute their own data regarding anything from smart meters to outage management system information (MSI).  With all of these very different and intricate sets of data coming together, one of the biggest challenges the utility industry will face is determining which data sets are to take priority, which to supplement, and the analytics that creates the best mesh. The ability to accurately do this will give companies the capacity to predict and prevent problems rather than having to fix a problem after it has already arose. This will be the case with regards to almost every facet of the utility process.

Solutions have already been proposed and introduced in the way of analyzing data from electrical grids. In early 2014 at DistribuTECH – the largest conference for the electric and gas utility industry – GE Digital Energy announced their own solution for Big Data and the various challenges utilities are up against. This solution is Grid IQ Insight’s Advanced Meter Insight. This solution is powered by Predix – GE’s industrial internet software platform. This is the first of five applications that GE Digital Energy plans to release under Grid IQ Insight. This application provides a platform that enables analytics to be produced that let utilities visualize and learn more about their operations via massive amounts of data. This essentially brings utilities one step closer to being as efficient as possible with all of the information they are now able to harvest about their services and maximize their value.

An example of these analytics creating greater efficiency and preventing rather than fixing includes social media. By utilizing the social media analysis facet that this technology is capable of, utilities are able to monitor the average amount of social media activity in a given consumer area, (tweets, posts, shares, etc.) and, when these numbers fluctuate for any reason, they are able to determine whether a connectivity or electrical problem is to blame. This puts them ahead of the problem before it matures and limits the number of frustrated consumers. Even more so, after this remedy is applied, utilities will be able to more easily discourage the problem from happening again.

The next step is for utilities to continue to invest in these new technologies and to ensure their services and technologies are as versatile as possible for what’s to come in the future. Innovative advancements like that of GE bring us that much closer to being the most efficient, economic and canny consumers/producers of energy that there have ever been.

 

Reinventing the Electric Utility in New York

Energy Distribution 1

A new system for overseeing energy distribution is gaining traction in New York.  The goal of the New York Public Service Commission (PSC) through its proposal called Reforming the Energy Vision (REV), is to change the way NY’s electricity is procured, distributed and regulated to create a more efficient and powerful infrastructure.  As power outages become more frequent and severe weather increases, the need for change is evident.  The REV would complement central generation efficiently, reconfigure utility regulation, and yield resources to accommodate the rapidly increasing demand for energy.  As one of the three states that have fully self-contained electricity generation, transmission, and distribution, it is possible for New York to take part in the new and innovative way of generating, harboring, and distributing energy.

New York’s current central generation structure cannot keep up with the rate at which technology is developing and advancing. This makes its structure inadequate in the State’s efforts to keep up with an economy that is continuously technologically advancing. One of the main ways the improved structure will facilitate this notion, (while saving money and resources in the process), is by creating more efficiency with regard to peak demand. Peak demand happens when, on the hottest day of the summer for example, the use of central air systems and A/C units skyrocket.  During this time, an exponentially higher amount of electricity is needed to accommodate citizen’s efforts to keep cool. Though this accommodation is only temporary – a few days or so – consumers are spending hundreds of millions of dollars a year in order to consistently maintain the grid’s ability to handle these “rare” occasions. With the new structure, a consumer’s smart appliance will have the ability to communicate with both those of other consumers, and the utilities themselves. With this being said, a consumer’s A/C would be able to utilize this communication to dictate how much power it needs to take from utilities, as well as, signal to other appliances to use less energy. All of this while consumers that have partnered with utilities, share harvested energy from their rooftop solar panels in order to help fellow New Yorkers cope with heat wave. The energy that these consumers share will result in a lower cost for their energy consumption as a whole. This new system will provide New Yorkers the ability to be smarter about when, the amount, and how they use energy as well as the ability to create their own energy and reduce their costs all together.

Also with this new model, consumers will have greater access to energy resources as current utility providers within this infrastructure would serve a less controlling, yet still pivotal position as Distributed System Platform Providers (DSPP). In this way, they would act as the middle men between consumers and the bulk power systems, thus allowing consumers to be able to better manage the ins-and-outs of their own energy. Newly created markets, operational systems, and tariffs will both further regulate and create more opportunities and value within the utility system.

The main questions that arise within this plan are related to the different variables of energy that would be produced and the technologies needed to support them. If these new energies vary too extensively or are not completely reliable/consistent within the electrical grid, this system could produce more headaches than smiles. Consolidated Edison (ConEd) is also reported saying that location will play a substantial part in the possibility of value within this system. Within highly congested areas, DSPPs will likely expend more for distribution, storage, and demand response.

With this new way of energy distribution, companies will be encouraged to base their rates on projected activities and demand of the future rather than on the previous year’s investments – which most do now. This enables them to not only include the effects of new technologies and advancements in their rate-making for the future, but also to look ahead at these advancements and re-align the way they invest in their future and consumers.

The process of considering this new way of energy generation and distribution is under way as the PSC has already begun to map out the ways in which it can be implemented. There is still much to be done such as realignment of distribution, determining supporting technologies, and implementing incentives for current electricity providers.  However, with PSC’s plan, a new parallel between consumer preference and utility business models will emerge.  Consumers will gain more authority within their electrical utility, and a more efficient and flexible structure crafted to embrace technological advancements of the future.

The Difference Between ASHRAE Audits

ASHRAEAn energy audit is the evaluation of a building’s energy consumption by professional engineers to uncover operational and equipment improvements that will save energy, reduce energy costs, and lead to higher performance.  In many areas, this is mandated by local law and depending on the locale, there may be incentives to alleviate the cost of the audit.  The American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE) set forth standards and three types of audits to have performed – each building on the previous one.

ASHRAE Level 1
The ASHRAE Level 1 audit is the basic starting point of a buildings’ energy optimization.  It consists of a brief interview of utility bills and operating data, interviews with site operating personnel, and a walk-through of the building.  Its’ purpose is to understand the building configuration, nature of energy systems and report on recognizable efficiency opportunities.  This audit helps establish a baseline in measuring improvements and whether further evaluation is needed.  This audit will also outline the range of potential financial incentives available from Federal, State, Local, and Utility sources.

ASHRAE Level 2
The ASHRAE Level 2 audit starts with the findings of the Level 1 audit and dives deeper into the buildings’ energy systems for improvements.  The audit starts with a detailed analysis of energy consumption and conditions that affect energy performance such as lighting, air quality, and ventilation to name a few.  The results of an ASHRAE Level 2 audit should be a clear report and outline of Energy Efficiency Measures (EEMs) including the general costs for changes and upgrades.  Some EEMs can be implemented immediately while other complex matters may require more detailed analysis of the building operations and influencing performance factors.

ASHRAE Level 3
If there are more in-depth issues that need further analysis after an ASHRAE Level 2 audit – the next step would be an ASHRAE Level 3 audit.  Reasons for this would be that system upgrades or retrofits discovered may require significant investments to implement.  The ASHRAE Level 3 audit is a way for the building Owner to have a clear and detailed understanding of the costs and performance expectations.  This complex audit entails detailed data collection over weeks or months which is used to calibrate a computer model of the building that responds to changes the same way the facility would be expected to respond.

Your energy auditor will work closely with the building owners, staff, and other key participants throughout the process to ensure accuracy of data collection and appropriateness of energy efficiency recommendations.  It is important to secure the right partner who understands your projects goals, available budget, and who will help determine the right level audit for your buildings’ needs.

The Power of Big Data

Word Cloud "Big Data"

It is becoming more and more evident that Big Data is getting BIG, and the role of analytics just may be an immediate divide between one company and another as data becomes a crucial part of production, labor and capital.

According to research by McKinsey & Company – a global management consulting firm that serves leading organizations – almost all industries in the U.S. economy had at least 200 terabytes of stored data per company with more than 1,000 employees in 2009.  The International Data Corporation (IDC) predicts that by 2020, the total digital universe will be 44 times larger than that.

In the utility realm, recent advancements in smart grid devices and applications are creating significant increases in the amount of data now available.  In actuality, the need to reinvent the technology surpassed simply adding new hardware or making updates to existing infrastructure.  With real-time applications, weather information, smart meters, etc., utilities are inundated with data and the increase in technology and information is changing the ways utilities operate.  Traditional operations are being re-evaluated and strategy adjustments are needed to improve ROI.  However, this influx of data will allow utilities to process and leverage it to execute innovative and valuable strategies.

Big Data is complex, but proper analysis can bring transparency and yield significant results.  It takes expertise to understand the intricacies and utilize sophisticated analytics to create value from large amounts of data.  However, doing so can result in better management decisions based on real-time information and forecasting abilities.  In an age where data and technology are revolutionizing the way we do business, it is important to be forward-thinking.  Don’t fear the data – optimize it of all it’s worth.

Utility Rate Hikes: No-Win Scenario for NY Ratepayers

Rate Hikes

As New Yorkers pay the highest average electric rates in the continental United States, it is important to understand what goes into a rate hike.  Once investor-owned utilities have a rate increase approved, not only do they charge the consumers that higher rate, but also take the cost for representing themselves to get the increase approved and pass that through to the consumer as well.

A proposed rate increase is brought forth and approved by the Public Service Commission (PSC).  According to a new AARP report, it states “Essentially, ratepayers are paying to propose and defend increases in their own rates.  In contrast, ratepayers have little to no representation at the PSC during rate proceedings, even though the ratepayers are paying the legal bills of the party who is trying to raise their rates”.

There are 40 states in the United States, plus the District of Columbia, that have a utility consumer advocate office to represent the consumers in state and federal utility regulatory commission proceedings.  These offices are charged with taking legal positions opposing the utilities and their regulators, and seek judicial review.  There is no such office in the state of New York to fight rate increases on behalf of ratepayers or to appeal a rate increase in court.  In-turn, it should be no surprise that New York rates are 56 percent above the national average and second costliest in the nation – only second to Hawaii.

The AARP examined the electric rate savings for customers that have independent utility consumer advocate offices and found that the savings from such offices far exceeded the cost for their operations.  Here are some of their findings:

  • Connecticut reported approximately $730 million in savings on a $3 million budget – a 243-1 ROI.
  • Illinois reported approximately $300 million in savings on a $2.6 million budget – a 115-1 ROI.
  • Maryland reported approximately $114 million in savings on a $3.2 million budget – a 36-1 ROI.
  • Main reported approximately $24 million in savings on a $1.7 million budget – a 14-1 ROI.
  • Ohio reported approximately $107 million in savings on a $5.1 million budget – a 21-1 ROI.
  • Pennsylvania reported approximately $500 million in savings on a $5.1 million budget – a 98-1 ROI.

It is evident that when utilities push for a rate increase, ratepayers need to be able to push back.  An independent utility consumer advocate office in New York to advocate and participate fully in cases before the PSC would allow ratepayers a voice when it comes to their higher charges and the costs to utility providers that are being passed through to them.

How Patterns of Energy Consumption Have Changed in the U.S.

Energy-Consumption-Patterns

There is no doubt that the use of energy in America has changed drastically through our history which can be attributed to the new sources introduced.  The chart below from the U.S. Energy Information Administration (EIA), demonstrates how our energy sources have changed over time.  Beginning with wood as the sole primary energy source, we evolved to hydroelectric power (flowing water that creates energy and turns it into electricity – like that of a water mill), then coal, and now petroleum products lead the way.

From this chart we can see that coal has been a steady resource for our country.  It seems to drop when other sources surface – such as oil and natural-gas – but tends to always make a come-back.  This may be due to the fact of it being cheap, and the numerous ways in which coal can be used.

The EIA states, “Since the mid-20th century, the use of coal has again increased (mainly as a primary energy source for electric power generation), and a new form of energy—nuclear electric power—emerged.  While the overall energy history of the United States is one of significant change as new forms of energy were developed, the three major fossil fuels—petroleum, natural gas, and coal, which together provided 87% of total U.S. primary energy over the past decade—have dominated the U.S. fuel mix for well over 100 years.”

Renewable energy – such as wind and solar power – are increasing.  However, based on this chart of historical energy consumption in the U.S., that does not at all mean the use of other sources will decrease in its’ place.  In fact, the EIA predicts that in 2040, 75% of U.S. energy will still come from oil, coal, and natural gas.

What are Common Utility Bill Errors?

Utility Bill

Utility bills aren’t pretty – and it can be quite an undertaking to identify billing discrepancies and issues without professional help.  In our experience, as a utility bill auditing firm, we see very frequently that individuals and companies do not see this process as mission critical to their business.  However, billing issues are more frequent than one thinks, and can amount to significant monetary loss.  Here are just a few:

1. For businesses’s that switch providers in a deregulated market, it is important to ensure all relevant account information, lie tax exemptions, are carried over and that the new contract starts when the older one expires – with no overlap.

2.  An error in a rate assignment could add up to substantial lost money over time.

3. Meter misreads and clerical errors are common sources of overcharges.

4. Invoice issues, such as billing period overlaps, duplicate charges, and/or credits not being issued.

5. One may be charged on incorrect rates, or there may be more beneficial rates available.

Reviewing your utility bills for inconsistencies can be very profitable, however they can be complex and hard to decipher.  Forensic utility bill auditing firms can be a truly beneficial resource in finding issues not typically seen by the naked eye.  In fact, it is possible to go back and analyze historical data up to 6 years to identify current AND past billing issues.  Customized algorithms allow auditing firms to dive deep into data to locate discrepancies others almost always miss and can even flag potential future issues.

For more information on the importance of a utility bill audit or how UtiliSave can help – visit our website at www.utilisave.com or call one of our industry experts at (718) 382-4500.

Energy Production Increase Proves Positive

Energy production in the United States has changed quite a bit over the last 20 years, and what is most compelling is that it has grown in almost every field – demonstrating a strong and growing energy economy.

According to Energy.gov, U.S. energy production has increased by 16% between 1993 and 2012, which they illustrate in their graph below.  The unit of energy used is called quads (quadrillion BTU).  Some common equivalents to 1 quad are 8,007,000,000 gallons (US) of gasoline, 293,083,000,000 kilowatt-hours (kWh), and/or 970,434,000,000 cubic feet of natural gas.

Energy-Production-Increase

Energy.gov does not have total data from the past two years, but recognizes that nuclear energy has grown steadily, while other types of energy have experienced volatile production year-to-year, such as coal and renewable energy.  Virtually non-existent biofuels in 1993 have grown from 0.17 to 1.8 quads and natural gas has increased by 33% from 2005-2012 alone.

The increased production of energy means good things for American families and small businesses as it creates more jobs, lowers costs, and reduces our dependence on foreign countries.  The House Committee on Natural Resources note that for every penny the price of gasoline increases, it costs consumers an additional $4 million per day ($1.4 billion over an entire year).  This is prevented by the United States producing its own energy resources – oil, natural gas, coal and nuclear, as well as alternative sources such as wind, solar, hydropower and geothermal.  With that, the proof is in the numbers that we are on the right track to doing so.