City of Boulder SmartRegs Program in Action

The City of Boulder's SmartRegs program has arrived. SmartRegs requires all residential rental housing, representing about half of the city of Boulder's housing stock, to meet a basic energy efficiency standard by 2019. The SmartRegs Program is the first of its kind to be implemented in the United States. There is some discussion that a similar program may be applied to commercial properties in the future. After careful research and planning, I have stated the process of upgrading my own properties to meet the efficiency standards determined by the SmartRegs program. Following is a list of specific actions I've found that can help make your properties greener, some of which save money and improve the appearance and livability of the property.  

Insulation: In my 4-unit building it costs $1,060 to put 13 more inches of insulation into the attic that had approximately 3 inches of insulation to begin with. The building is 3,186 SF and was built in 1969. I received $530 toward the total cost in a matching grant from the Center for Resource Management.

Result: It costs $500 for labor and $560 for materials. My monthly savings on natural gas is $10 per month. My payback period will be 4.42 months after the grant money and 8.83 months before the grant money.

Windows: In my 10-unit apartment building, I spent $13,142 dollars to replace 24 windows and 10 sliding glass doors on a $6,900 SF apartment building in 1973. I applied for a loan through the Boulder Climate Smart Loan program from which I received $4,260 in rebates for a total cost of $8,882.

Result: My total natural gas cost for 2011 was $4,021. If I use an energy savings in the 15% range (as per Energy Star), my savings would be $603 per year. That would be a 21.79 year payback before rebate or a 14.73 year payback with the Rebate Note: I chose to go forward with this program even though the payback does not make short term financial sense; window replacement does enhance the appearance of the building and will increase the ability to rent the units.

Boilers: In my 16 unit building I replaced 770,000 BTU boiler with (2) 200,000 BTU boilers. Total cost was $36,550. I received $4,975 in rebate money from the Boulder County Energy Smart program and $1,400 from Xcel Energy for a total replacement cost of $30,175.

Possible Result: The old boiler was running at approximately 55% efficiency while the new boilder is running at 92% efficiency. My hope is that the new boiler will reduce energy cost approximately 37%. My energy costs for this building were $6,422 so I hope to save about $2,376 per year. This is a 15.4 year payback before rebate and a 12.7 year payback after the rebates. Note: boiler replacement is a large capital cost, investment of time and disruption of service to the tenants.

Knowledge of your building is critical to understanding which improvements make sense, both financially and for conservation reasons. Some decisions are made to save money or to follow new regulations, while others can greatly improve the overall appearance and livability of the property. Take advantage of local, state and federal rebates and incentives- do your research before you begin. The expenses used in my examples are estimates and can vary from property to property and month to month. Please contact me for your commercial/investment Real Estate needs.