Co-op Short-Circuits Its "Fixed" Electricity Costs

Dublin native Stephen Doherty has degrees in physics and business administration, a marriage of disciplines that gives him a unique ability to understand both how building systems work and how much it should cost to run them. Those skills have proven invaluable since 2012, when Doherty became president of the Amherst, a 235-unit co-op at 401 East 74th Street.

Doherty, 65, and a slate of four other like-minded shareholders wrested control from a board that had kept maintenance flat for years while taking on debt – and then raised maintenance sharply. So Doherty and the board’s treasurer, Kenneth Schultz, an accountant, started digging.

“We were looking at ways to reduce costs,” Doherty says. “We’re both extremely detail-oriented and we had both worked for large multi-national organizations. Everyone talks about a co-op’s costs being fixed, but I don’t buy it.”

Doherty and Schultz learned that the co-op was spending $80,000 a year on electricity and $180,000 each on gas and water. “Most people pay no attention to these costs,” Doherty says. “Nobody had bothered to see where that money was going. But if you can save just 1 percent on a big expense, you can see real savings. My first question was, is the electricity being used wisely and efficiently?”

In order to answer the question, though, it would be necessary to monitor the 201 circuits that feed the building’s systems, including three elevators, common area lights, 27 exhaust fans on the roof, laundry room, various pumps and fans in the basement. “I found a company here in New York called Enertiv that makes a device that monitors electrical usage down to the individual circuit level in real time,” Doherty says. The board agreed to buy 10 monitors at a cost of $35,000.

“Once we put the Enertiv system in,” Doherty says, “I was able to see where the $80,000 in electricity was going every year, and 25 percent of it was going to light the hallways 24/7. So we spent $4,500 on 600 LED bulbs and components to replace the 400 compact-fluorescent lamps in the hallways, and we had the staff swap them out.” The result: the yearly cost of lighting the hallways was slashed from $20,000 to $9,500. The LED lights paid for themselves in less than six months.

With a total of 12 Enertiv boxes now in place in the building, Doherty says, “I can tell if a piece of equipment is not running when it should be, if it’s running when it shouldn’t be, or if it’s not running properly. This lets the staff address problems before residents are even aware of them.”

The co-op’s property manager, Ed Ermler of Midboro Management, is also an electrical engineer and president of a four-building, 437-unit co-op in Queens. He cautions that Enertiv might not be appropriate for larger co-ops or condos. “And it’s not a fail-safe system,” he says. “Somebody has to look at the data and drill down. It doesn’t tell you what the problem is, but it tells you when something needs attention.”

The Enertiv system is just part of this co-op board’s many-pronged assault on energy costs. A combined heat and power, or cogen, system is nearly finished, with energy savings projected at $125,000 a year. Steam traps were replaced throughout the building. Both boilers were upgraded, and the hallways and laundry room were renovated, with air-conditioning added. The board is now modernizing all three elevators and tackling Local Law 11 facade work. The roof will be replaced next year. Thanks to savings from the Enertiv system and the sale of former rental apartments, the co-op is able to draw on its healthy reserve fund without assessing shareholders. Maintenance increases have been held below 3 percent over the past six years. Not bad for a building built in 1962.

“We’re proof,” says Doherty, “that you can teach an old dog new tricks.”

PRINCIPAL PLAYERS – ELECTRICITY MONITORING: Enertiv. PROPERTY MANAGEMENT: Midboro Management. ELEVATOR CONTRACTOR: BP Elevator Co.