As a board member, managing the finances for your condominium association is one of your chief responsibilities. Every dollar counts, and you want to make the most of your association’s money. So you look at the budget. You negotiate the best deals with your vendors. And you work with your property management company to make the most of every relationship.
But have you searched floor to...ceiling?
That’s right – a great way to save money is right over your head. Swapping traditional, incandescent light bulbs with energy-efficient LED bulbs will use less power and reduce your condo association’s costs. Here we answer some typical questions to shed a little light on what you need to know about LED lighting.
How do I get my condo association on board to make the switch?
Change isn’t always easy, but the right motivation can help. In the case of switching to LED lighting, you will do best if you speak to the long-term financial benefits and present hard numbers about the reduction in energy use. If you have been benchmarking your energy use, you can also point out how LED lighting can improve your ranking. Clear before and after data demonstrating the impact that LED lighting can have is likely to inspire homeowners to want to make the investment.
In Chicago, where large residential buildings are subject to energy benchmarking requirements, many buildings managed by FirstService Residential not only take advantage of our benchmarking services, but also ask us to perform energy evaluations. A detailed energy evaluation identifies improvements that will have the greatest impact on a building’s energy use, as well as on an association’s budget. Switching to LED lighting is often among the measures identified.
What are the financial benefits to our condo association?
LED (it stands for “light-emitting diodes”) bulbs have clear financial pluses for your building. For one thing, they last much longer – from 30,000 to more than 50,000 hours longer – so you won’t need to replace them as often. Where you’ll really save money, however, is on your electric bill. LED bulbs use up to 75 percent less energy than traditional bulbs.
One Chicago property managed by FirstService Residential that switched to LED bulbs reduced lighting costs by 81 percent in just one year. “Their lighting expenses dropped from $40,645 to just $7,811 annually,” says Robert Meyer, director of engineering at FirstService Residential’s FS Energy subsidiary.
Are LED bulbs more expensive than traditional bulbs?  
Yes, your condo association will need to make a significant investment up front to switch from incandescent to LED lighting. Here’s how it breaks down: A traditional bulb may cost you just $6, but powering it every day for a year will cost about $87.60. On the other hand, you might pay up to $45 for an LED bulb, but it will cost only $10.51 per year to burn. That’s a potential savings for your association of $38.09 per bulb in year one alone.
Don’t forget about that longer lifespan, too. Although you’ll have to buy a new incandescent bulb after as few as 2,000 hours, LED lighting will last anywhere from 15 to 25 times longer. It’s true that you could buy nine of those $6 incandescent bulbs for the price of an LED bulb, but the LED bulb will last well beyond the lifespan of those nine traditional bulbs. Remember, however, that not all bulbs are created equal so don’t cut corners. Be sure to look for bulbs that have an EnergyStar® rating and are from a good name brand.
Can our association get any financial assistance with the up-front costs?
Energy rebates can provide immediate financial relief. “Utility rebates are a great way for properties to save a little out-of-pocket cost while taking advantage of energy efficiency updates,” says Meyer. Rebate funding typically occurs in January and June, but check with your local energy suppliers to find out what programs they offer and when they are funded.
According to Meyer, the FirstService Residential property mentioned earlier took advantage of utility rebates when they decided to install LED lighting. Initially, the cost came to $27,552. Utility company rebates totaled $3,444, which brought the cost down to about $24,000, including installation and disposal of old lighting. “So they spent a little more than half of their previous annual lighting budget to implement energy-efficient lighting,” Meyer explains. “The payback for this was 0.73 years, at an annual return on investment of 12 percent and a lifetime savings of $144,985.”
How can my property management company help?
A quality property management company should be able to help you identify comprehensive energy and cost-saving opportunities. Meyer says that when FirstService Residential begins to manage a property, his team conducts a thorough walk-through to look for potential energy savings. “We note where ‘low-hanging fruit’ can be harvested to show an almost immediate return on investment to the association,” he says. “This always includes upgrading lighting from existing incandescent and fluorescent to LED.”
Energy is one of the largest expenses for condo associations, so anything you can do to reduce your usage can have a significant impact on your budget. Starting with LED lighting is a great option.
To learn more about how your condo association can reduce its carbon footprint while saving money, contact FirstService Residential, the leading property management company in the Chicagoland area.
Tuesday June 06, 2017