skip to main content
OSTI.GOV title logo U.S. Department of Energy
Office of Scientific and Technical Information

Title: Shared-savings cuts hotel's losses from EMS removal

Abstract

A shared-savings contract will minimize the Myrtle Beach, SC Downtown Holiday Inn's losses of replacing a poorly performing Energy Master energy-management system with Scientific Atlanta equipment. The contract with Energy Master Inc. (EMI), which saved Holiday Inn the $80,000 to $90,000 purchase price, also permitted removal (a year after installation) of the equipment when it failed to generate energy savings. A dispute between Associated Energy Consultants (AEC), which was to receive half the savings in exchange for arranging the equipment financing, is described. At $51,745, the 262-point Scientific Atlanta system should have a 1.7-year payback. The hotel's electric bills were $2000 a month lower during the first three months of operation. (DCK)

Authors:
Publication Date:
OSTI Identifier:
6601602
Resource Type:
Journal Article
Resource Relation:
Journal Name: Energy User News; (United States); Journal Volume: 7:45
Country of Publication:
United States
Language:
English
Subject:
32 ENERGY CONSERVATION, CONSUMPTION, AND UTILIZATION; ENERGY MANAGEMENT SYSTEMS; FINANCING; PERFORMANCE; HOTELS; CONTRACTS; BUILDINGS; COMMERCIAL BUILDINGS; ENERGY SYSTEMS 320104* -- Energy Conservation, Consumption, & Utilization-- Commercial & Industrial Buildings-- (-1987)

Citation Formats

Galvin, C. Shared-savings cuts hotel's losses from EMS removal. United States: N. p., 1982. Web.
Galvin, C. Shared-savings cuts hotel's losses from EMS removal. United States.
Galvin, C. 1982. "Shared-savings cuts hotel's losses from EMS removal". United States. doi:.
@article{osti_6601602,
title = {Shared-savings cuts hotel's losses from EMS removal},
author = {Galvin, C.},
abstractNote = {A shared-savings contract will minimize the Myrtle Beach, SC Downtown Holiday Inn's losses of replacing a poorly performing Energy Master energy-management system with Scientific Atlanta equipment. The contract with Energy Master Inc. (EMI), which saved Holiday Inn the $80,000 to $90,000 purchase price, also permitted removal (a year after installation) of the equipment when it failed to generate energy savings. A dispute between Associated Energy Consultants (AEC), which was to receive half the savings in exchange for arranging the equipment financing, is described. At $51,745, the 262-point Scientific Atlanta system should have a 1.7-year payback. The hotel's electric bills were $2000 a month lower during the first three months of operation. (DCK)},
doi = {},
journal = {Energy User News; (United States)},
number = ,
volume = 7:45,
place = {United States},
year = 1982,
month =
}
  • Reduced plant production levels are lengthening the payback period for industrial heat-recovery equipment because savings are directly related to the production of process heat. Although the payback for some equipment exceeds acceptable limits (as long as 15 years are now projected in some cases), the payback problem is not as serious as the plants' need to increase production in order to survive. Several companies report their lengthening paybacks in relation to their production-level and fuel-cost uncertainties. (DCK)
  • Managing electric loads to avoid demand charges is resulting in energy savings for industrial and commercial users. The days of cheap power are over; energy prices are soaring and utilities are overhauling rate structures to make demand charges even more expensive. Many hard-pressed utilities are experimenting with schemes to even out demand, though. Time-of-day pricing, time-of-year pricing, and load cutting during peak periods are being tried. Many different types of demand-limiting controllers are on the market, ranging from simple devices to complex computer systems. They measure the energy being consumed in a facility and limit demand by turning off nonessentialmore » loads. Three distinct techniques are used to control demand: ideal-rate control, predictive control, and instantaneous-rate control. After a discussion of these techniques, control system operation and some component descriptions are given. (MCW)« less
  • A utility study on financing conservation equipment found that nonprofit users will benefit most from shared-savings arrangements because they lose no tax benefits. The shared-savings supplier can then drop his usual 80% share of the savings to 50%. Nonprofit users will save on first-year costs and will avoid servicing expenses. The General Public Utilities study considered only economic factors in comparing shared savings with loans, leasing, lease-purchasing, and internal funding.
  • Energy consultants are offering capital-free service on a shared-savings basis, but there is disagreement over whether the long-run costs are higher for shared savings than direct investment. The low-risk plan appeals to companies with capital shortages, while the long-term commitment appeals to the consulting firm, which benefits from a share of the savings and all the tax benefits. Several firms describe the mechanics and benefits of their shared-savings arrangements. (DCK)
  • An Internal Revenue Service challenge of a shared-savings tax shelter scheme that overvalues conservation equipment in order to attract investors may cost the suppliers of such equipment. The CSL Company asks users to relinquish about half their energy savings in exchange for not having to invest capital for the equipment. They are asked to give up all the tax benefits for depreciation, business investment, and energy tax credits. CSL overvalues the equipment by adding projected energy savings. Other firms hope that the action against CSL and the Fulham Group will not drive out funding for legitimate arrangements. (DCK)