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Simple Energy & Water Savings for Multi-Family Buildings

November 5, 2019

Multi-family property owners are oftentimes hesitant to take the plunge into energy savings projects. Typically, this is due to inexperience with these types of projects, uncertainty surrounding expected savings, or unclear financing incentives. Below we discuss some simple energy and water savings opportunities that can be implemented within a multi-family property as well as some alternatives to typical financing options for energy savings projects.

Energy and Water Savings Opportunities


As a basic rule of thumb, it is recommended that the Environmental Protection Agency’s (EPA) ENERGY STAR certified appliances to be installed in place of older appliances.

Smart Dishwashers

Smart dishwashers help to minimize water use, include more energy efficient motors, and have “cleanliness sensors” that determine if dishes are clean. Look for a dishwasher using 3.5 gallons of water per cycle or less, and annual energy use of less than 270 kWh/year.

Efficient Refrigerators

Per ENERGY STAR, a new ENERGY STAR certified refrigerator is about 15 percent more energy efficient than the minimum federal standard for refrigerators. An ENERGY STAR certified freezer uses approximately 10 percent less energy than a new, non-certified model.

Clothes Washers

Efficient clothes washers use sensor technology to control water temperature and volume. ENERGY STAR claims 25% more efficiency than standard efficiency models. Look for clothes washers using an integrated water factor (IWF) less than 4.3 and annual energy use of less than 300 kWh/year.


The EPA’s WaterSense labeled products aim to save water and money.


The current federal standard for toilets is 1.6 gallons per flush. Efficient toilet replacements are recommended to be a WaterSense labeled unit with a minimum of 1.28 gallons per flush. As an example, if a toilet gets flushed 1,000 times, savings total 320 gallons of water and $$$ when using a WaterSense toilet. An alternative would be installing dual-flush toilets that handle solid (more water) and liquid (less water) waste differently to conserve water.


Standard showerheads typically use 2.5 gallons of water per minute (GPM). A replacement WaterSense labeled unit uses a minimum of 2.0 GPM. According to, the average shower lasts 8.2 minutes. Assuming a family of four takes one shower a day for a month, by switching to a lower flow showerhead, water savings are almost 500 gallons.


If sinks are not already WaterSense labeled, with a maximum flow rate of 1.5 gallons per minute, the installation of an aerator is recommended. An aerator is a small device that attaches to the end of a sink faucet. Aerators use small perforated screens that add air into the flow of water by separating the water into numerous tiny streams. Aerators can significantly impact the amount of water savings for a small price. Typical water faucets without aerators use around 2.2 GPM. Installing aerators can help to reduce water use to 1.5 GPM or even to 0.5 GPM.


When updating split system condenser units or heat pumps, replacement units are recommended to be rated for at least 15 SEER. What is SEER? SEER stands for the Seasonal Energy Efficiency Ratio. This is a measure of the season cooling efficiency of an electric air conditioner or heat pump calculated by the total cooling of the air conditioning unit by the total electrical energy input. When updating gas furnaces, systems should be evaluated based on their AFUE. AFUE stands for Annual Fuel Utilization Efficiency. Simply put, this is a measure of the gas furnace’s efficiency in converting fuel to energy. A furnace that has a 75 percent AFUE rating has the ability to turn 75 percent of the energy it consumes into heat. The remaining 25 percent is consumed during the heating process (not efficient).  Replacement units are recommended to have at least 90 AFUE and even higher for northern U.S. states.


LED! Convert all light fixture lamps to LEDs where possible. A 40-watt incandescent lamp provides about the same number of lumens (visible light) as a 9 watt LED lamp. Hint: your electricity consumption is billed through kilowatt-hours. Additionally, a typical incandescent lamp like the one mentioned above has an average rated life of 1,000 hours vs. a LED lamp with an average rated life of 25,000 hours. If your electric bill includes per kW demand charges, your savings will be even more.

Financing Options for Multi-Family Energy Savings Projects

There are many ways to have your multi-family energy savings projects financed. Besides the typical loan financing or lease financing options for energy projects and products, financing can also be achieved through the following alternative options:

Energy Savings Performance Contracts (ESPCs)

Energy savings projects are installed and maintained by an energy service company. As the energy saving systems save money over time, these savings are used to make service payments back to the energy service company. After the term of the contract expires, the customer takes responsibility for the implemented energy savings systems and benefits from all future savings.

Power Purchase Agreements (PPAs)

Although typically utilized for renewable energy systems, such as solar, in a power purchase agreement, a third-party developer finances and coordinates the implementation of an energy savings system. As an example, if a customer decides to engage in a power purchase agreement (PPA) for solar energy, the customer does not own the solar energy system but reaps the benefits of no upfront capital costs, and reduced energy rates through the PPA. Excess energy (kWh) generated by the solar energy system is sent back to the utility company.

Commercial Property-Assessed Clean Energy (C-PACE)*

In this financing structure, the customer (building owner) borrows money from private investors or government programs for energy savings projects. Energy savings projects are developed and approved so that the savings exceeds the cost of financing. As the energy savings projects are installed, the customer begins to benefit from the energy savings immediately. The customer repays the project through an assessment on the property tax bill (which is transferable during the sale of the building) over a period typically lasting 10 to 20 years.

*Currently active or in development for 26 states and D.C.  Please contact VERTEX for a listing of participating programs.

Federal Housing Financing Agencies

Fannie Mae offers “Green Financing” for loan borrowers of multi-family properties. Green Financing from Fannie Mae offers lower interest rates and 100% rebates on all energy and water audits performed by a professional audit firm, such as VERTEX, if the loan closes as Green Rewards. Freddie Mac has a similar “Green Advantage” loan that provides a $3,500 rebate on energy audits when the borrower closes a loan with Freddie Mac.

How Can VERTEX Help?

VERTEX can assist multi-family property owners and lenders in finding ways to save water and energy by performing ASHRAE Level 1 and Level 2 Energy Audits, multi-family energy and water audits, and ENERGY STAR Certification and Benchmarking services.

To learn more about VERTEX’s Energy Savings & Disclosure Services or to speak with an Energy Savings Expert, call 888.298.5162 or submit an inquiry.

*Energy & Water Audit rebates may have changed since the time this blog was published. Please contact VERTEX to get current rebate incentives. 

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