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Business Energy Saving Facts

The following tools, tips, and suggestions can help you get a handle on electricity usage in your business, conserve energy and save money as well as provide improved comfort and safety.


Even if your business’s lighting system is new, you may still have opportunities available to reduce the energy necessary to light your facilities.
  • Relamp/reballast existing light fixtures: This is a quick, easy, and inexpensive process that will brighten your workplace and save energy.
  • Upgrade to new efficient lighting fixtures: Reduce the number of lamps per fixture, change the appearance of your lighting, and take advantage of newer lighting technologies.
  • Install lighting controls: You can install lighting controls that can be set to shut off lights according to the time, the daylight conditions, or the room or area occupancy.


There are four common ways you can save energy and cut costs, without sacrificing comfort, in your business's heating system:
  • Install set-back thermostats: Save energy by automatically setting back the temperature in a space for a scheduled unoccupied time. For many locations, this thermostat can easily pay for itself in savings in a very short time.
  • Properly control exhaust fans: Many exhaust fans operate continuously even though they might not need to. If code permits, it is important to turn them off when they are unnecessarily running and consuming energy. Small bathroom fans could be wired to the lights to operate only when lights are on, or a clock can be installed to turn off exhaust fans when the space is not occupied. Consult your local building officials to ensure this measure complies with local codes.
  • Invest in energy efficient equipment: Replacing commercial heating equipment to reap energy savings is uneconomical due to the large capital expense required. However, if it’s time to replace aging and inefficient equipment anyway, it is usually quite cost effective to invest the money in the energy-efficient models. Make sure you choose and install a system that fits your business’s needs by hiring a heating contractor.
  • Improve your building’s caulking and weather stripping: Building “envelope” improvements, including caulking and weather stripping, offer simple and low-cost ways to reduce loss of heat and cooling resources.

Heating equipment is rated with one of two seasonal ratings. HSPF represents heating performance over an entire season. This rating is equal to the total BTUs of heating delivered, divided by the total watt-hours of power used during a representative heating season. The more efficient ratings range from 8 to 10.

AFUE is the expected average efficiency of equipment for the heating season. This figure is equal to the BTUs of heating output, divided by the BTUs of fuel input during a representative heating season. The higher the rating, the better, with the more efficient ratings ranging from 84 to 97 percent.


There are four common ways you can save energy and cut costs, without sacrificing comfort, in your business's cooling system:
  • Install a programmable thermostat to regulate your business’s cooling system: Installing a programmable thermostat helps ensure regular temperature modifications and early morning comfort. The more hours per week the temperature can be set forward, the greater the savings. Many of these thermostats have the ability to estimate the necessary cool-down time to help ensure that the space is cooled to the proper temperature when desired. Consult your air conditioning service company to ensure proper thermostat type and installation.
  • Take advantage of “free cooling”: Controls can be installed in most RTAHU’s and other larger units that can automatically increase the intake of cooler outside air when conditions are favorable for such an exchange. Large air conditioning units that provide a mixture of outside and return air and must operate many hours are good candidates for free cooling.
  • Invest in energy efficient equipment: Replacing a commercial cooling system solely to reap energy savings is uneconomical. However, if it’s time to replace aging and inefficient equipment anyway, it is usually quite cost effective to invest the additional money in an energy-efficient model. Air conditioning/cooling equipment is rated with one of two seasonal ratings. Energy Efficiency Ratio (EER) rating is used for window air conditioners. The most efficient units are rated with an EER between 10 and 12. Seasonal Energy Efficiency Ratio (SEER) rating is used for all other cooling units. Shop for a cooling system with a SEER between 11 and 16.
  • Improve your building’s caulking and weather stripping: Building “envelope” improvements, including caulking and weather stripping, offer simple and low-cost ways to reduce loss of heat and cooling resources.

Water Heating

Reduce the energy consumed for making hot water and save money in your business:
  • Reduce the amount of hot water you consume by installing faucet aerators and/or shutoff valves: Faucet aerators can reduce the amount of water flow by up to 50 percent, while typically delivering sufficient hot water for your needs. Nozzle shutoff valves leave the cold water/hot water mix intact, a condition normally attained by running the water continuously.
  • Minimize the amount of energy lost in your hot water system: Lowering the temperature of your hot water can substantially reduce the amount of energy needed to heat it. A 10 degree reduction in water temperature can result in 3 to 5 percent reduction in energy usage. Insulating your hot water tank and piping can reduce your energy consumption by 4 to 9 percent. When insulating, be careful to leave openings for areas on your water heater that need to be accessed. Also, check with the tank manufacturer to make sure insulating your tank is not prohibited.
  • Consider a solar hot water heater: A conventional hot water heater is responsible for about 12 percent of your monthly energy bill. You can reduce the energy consumed by choosing a high efficiency, ENERGY STAR-rated solar unit.
  • Take advantage of “free heat”: Businesses that utilize refrigeration equipment and air conditioning may save costs by recovering the waste heat from their cooling equipment. Heat recovery water heaters use this type of waste heat as a means to heat water.
  • Change to a high-efficiency water heater: The most energy-efficient water heater is a heat pump water heater (HPWH) that extracts heat from warm, humid air and deliver that heat to a water storage tank. With this process, you not only dehumidify the air, but you also use the heated water for your operational needs. Heat pump water heaters are 2 to 8 times more efficient than electric resistance water heating and 14 times more efficient than gas-fired water heaters. In addition to heat pump water heaters, you can install other equipment to transfer heat from your refrigeration units and dishwashers to preheat your hot water as well.

The table below shows the efficiency of the most common methods of water heating. Energy factor is the annual energy output divided by the energy input.

Water Heater Typical New
Energy Factor
Most Efficient
Energy Factor
.48 - .53
.60 - .63
Gas-fired .51 - .56
.71 - .83
Electric Resistance
.87 - .91 .96 - .98
HPWH* 2.50 - 3.50
3.10 - 3.50

* HPWH's energy factor can be greater than 1.0 (i.e., it produces more energy than it consumes), because it ‘draws in’ energy from its environment, energy which is typically lost if not "reclaimed."

Motor Efficiency

Electric motors consume 64 percent of the electricity produced in this country. Much of this energy consumption is inefficient and wasteful due to motor size being mismatched to the horsepower requirements of the job.

For example, electric motors frequently drive variable loads such as pumps, hydraulic systems, and fans. In these applications, motor efficiency is often poor due to operation at low loads. The operating cost of a motor over its lifetime is many times its purchase price. For example, a 100 horsepower AC induction motor costs approximately $5,000, yet will use as much as $35,000 worth of electricity in a year.

Small improvements in efficiency can therefore generate significant savings in energy costs.

  • Loading: Since motors run most efficiently near their designed power rating, it is good practice to operate between 75 percent and 100 percent of full load rating. The National Association of Electrical Manufacturers (NEMA) publishes guides for selecting motor design types for particular tasks. Motor manufacturers are another good source of information on proper selection of motors.
  • Voltage balance: Proper power supply is essential for achieving rated performance of a motor. Unbalanced three-phase voltage affects a motor's current, speed, torque, and temperature rise. Equal loads on all three phases of electric service helps ensure voltage balance while minimizing voltage losses.
  • Motor maintenance: Regular maintenance helps minimize loss from friction and heat and extends motor life. Lubrication and cleaning should be performed periodically. Motors should also be checked for proper ventilation, mounting bolt security, and load change application.
  • Consider energy efficient motors: Energy efficient electric motors can improve efficiency from 3 to 8 percent. Heavier copper wire, higher core-steel grade, thinner core laminations, better bearings, and reduced windage design add up to better efficiency. Initial cost outlay is higher, but the return on investment can be quick, especially for high-use motors.
  • Electronic Variable Speed Drives (VSDs) control the speed and torque of an electric motor by varying the frequency and voltage of the electricity supplied to the motor. They replace inefficient, energy-robbing speed controllers such as belts and pulleys, throttle valves, fan dampers, and magnetic clutches. Their small size makes them ideal for retrofits.

Consult with an electrician experienced with commercial electric motors for help selecting the right motor for your job.

Caulking and Weather Stripping

There are three basic ways that a building’s shell loses heating or cooling energy: air infiltration; conduction through ceilings, walls and floors; and thermal radiation through windows. Reducing these undesirable transfers of energy will save you money.

Air infiltration: Fresh air is an absolute necessity for a healthy work environment. However, too much fresh air, or air that enters at uncontrolled locations, can be costly from an energy perspective, and may also lead to an uncomfortable work environment. Note that any effort to reduce air infiltration should include a review of the fresh air needs of the work space.

Caulking and weather-stripping are the most cost-effective methods of saving energy, by reducing the amount of air infiltration around doors, windows, and building corners. Make these your first line of attack against energy waste.

Conduction through ceilings/walls/floors: Insulation is your primary defense against heat loss or gain through the exterior surfaces of your building and can be a relatively easy method for reducing energy losses. Review the insulation value of your windows, as well. Multi-pane windows, some with inert gases between the panes, can provide more than double the insulating capabilities of your existing windows.

Thermal radiation: Your building’s windows can act like a conduit for thermal radiation. The heat from the sun can enter in your windows, heating the air in the room, and the heat inside your building can radiate out. How can you reduce this thermal radiation? 

Reflective window films can help to dramatically reduce thermal radiation losses. These are highly specialized materials, so consult an expert to determine the appropriate application of these films. Exterior or interior window treatments can also be used to block or filter the transfer of thermal radiation.


Refrigeration and freezing systems can account for a large portion of a facility's energy usage and therefore are excellent targets for energy efficiency improvements. There are three main energy saving strategies for refrigeration systems.
  • O & M savings: Set temperatures to the lowest possible setting, don't overload units beyond capacity and clean coils to improve heat transfer. Also, position refrigeration units in open areas where heat can be vented properly and air flows freely.
  • Compressor Modifications: Install variable speed drives (VSDs) and high-efficiency motors on compressors while using auto-unloading to reduce compressor work when the system is not fully loaded.
  • Condenser Modifications: Install variable speed drives (VSDs) and high-efficiency motors on condenser fans. Mechanical sub-cooling is a method of increasing the efficiency cycle by using an additional heat exchanger in the refrigerant cycle. Also, increase the heat exchanger area and improve the efficiency of the refrigerant cycle by over-sizing condensers.

You can also take some general improvement steps:

  • Install controls on anti-condensate heaters in order to minimize run-time. These controls sense the humidity in the air and operate the heaters only when needed.
  • Open-drive motor systems, as opposed to hermetically sealed motor systems, can make your refrigeration system more efficient by ejecting waste heat into the air, instead of back into the refrigerant, thereby reducing the cooling load.
  • Delamping (reducing the number of bulbs) and use of high-efficiency lighting not only reduces refrigeration lighting needs, but also reduces the amount of heat being introduced into the space being cooled.
  • Night covers on open refrigeration units can reduce your cooling load.
  • Glass doors or plastic curtains reduce heat gain from the environment.
  • Heat pipes are devices which may be installed on the HVAC equipment of buildings which operate refrigeration units. These pipes reduce the humidity of the air inside the building, thereby reducing icing on refrigeration display cases. This can save 12 to 15 percent of total refrigeration costs.

Commercial Cooking

If you operate commercial kitchen or cooking equipment, use the following tips to cut energy consumption and costs:

Improve your exhaust and ventilation system: Your ventilation system is necessary for removing heat, odors, and smoke from the cooking area, but too much ventilation can mean excessive energy use from either running the ventilation equipment itself, or by unnecessarily conditioning too much "fresh air" to replace the air that’s exhausted.

  • Install an energy-efficient exhaust hood, which can draw in outside air at its perimeter, avoiding use of the conditioned air removed by the exhaust air stream.
  • Install a variable speed control so your exhaust and ventilation system only runs when necessary.
  • Install side curtains around cooking equipment to avoid the necessary exhaust fan velocity.

Invest in energy efficient kitchen equipment and commercial appliances: In addition to better performance and ease of operation, many new technologies in cooking equipment improve energy efficiency so you can save money. In general, when compared to older models, many new types of equipment offer better insulation levels, more levels of control, and enhancements in heat transfer.

  • Highly insulated, programmable electric griddles concentrate heat only where and when it is needed.
  • Combination convection/microwave ovens have digitally programmable controls which allow you to select precise cooking times as well as cooking and holding temperatures, so you no longer have to constantly monitor the cooking process.
  • Electromagnetic induction fryers use lower heating element surface temperatures and less energy to maintain the ideal cooking oil temperatures.
  • Electric flash bake ovens use energy from light to quickly cook food, even faster than a microwave. The oven browns the outside of the food and cooks each ingredient according to its own "light absorption" pattern - the food retains its ideal taste, color, and texture. A single pizza, for example, cooks in 50 seconds.