Upper West Side Co-op Installs Heat Pumps to Cut Emissions and Ease Boiler Strain

By installing heat pumps in the basement to generate domestic hot water, an 11-story Upper West Side co-op is now able to switch off the building’s oil-fired boiler in the summer. Decoupling the hot water from the boiler like this is the first step towards cutting emissions through electrification but it also takes pressure off the aging boiler. “We don’t have to use the boiler for our hot water needs at all and that’s a big relief,” says board treasurer Tanya Khotin. 

Khotin specifically joined the board to usher in electrification at the 77-unit postwar building. While researching decarbonization strategies over the past few years, she identified how moving the domestic hot water to heat pumps could be done without major inconvenience for residents. “This got me thinking we should advance this,” she says. Even so, she recognized the board needed independent help to identify the right vendors and navigate regulations. “There are electrical engineering, mechanical engineering and architecture components as well as compliance requirements that are incredibly complex,” she says. 

The board partnered with the consultancy firm The Folson Group for that support. “They quarterbacked the process and told us at every point what was going on,” Khotin says. This included problem solving, dealing with vendors and managing the need to increase the electrical capacity to the building. The total cost of adding heat pumps to provide domestic hot water was $399,126, including The Folson Group’s management fee, with 50% of this met by NYSERDA and Con Edison incentives. “The project has cost the co-op approximately $200,000,” says Tina Larsson, The Folson Group’s CEO. 

Upgrades to the domestic hot water build on earlier energy-saving measures, including the installation of motion-sensor LEDs throughout the building. Together, these projects are expected to reduce annual emission penalties under Local Law 97 by around $20,000 starting in 2030. The next step will be replacing the building’s boiler with heat pumps for space heating and air conditioning. Larsson says this will enable the boiler to be decommissioned and steam radiators to be removed. “It will likely be a $2 million project,” she says. 

The funding for the building’s past and future decarbonization plans comes from a well-timed refinance of the co-op’s mortgage. “We added finance capacity when rates were below 3%,” Khotin says. Some shareholders have in-window air conditioning units and others have invested in through-wall and mini-split units so the board will need to figure out how costs will be fairly spread for all shareholders. “It’s an important question on how you treat shareholders that already have sunk costs and whether you are subsidizing the others,” Khotin says. 

The Folson Group’s role will conclude once the electrification projects are completed. “Folson charges a percentage of the project’s total cost,” Larsson explains. Their services include creating a master plan, identifying incentives, and coordinating with service providers. With an eye on savings, Larsson is also recommending the co-op’s accountant include the energy efficiency upgrades as a separate line item in their annual letter to shareholders. “This allows eligible shareholders to deduct up to $3,200 annually until 2032 as part of the Inflation Reduction Act,” she says.