What are the Economics of the Improved RTEM Incentive?
NYSERDA has made some critical updates to the 30% cash back program for advanced buildings technologies known as RTEM. In this video, Derek Cedarbaum explains the changes that have been made and what the new economics look like for owner-operators.
Hello, I’m Derek Cedarbaum, head of sales here at Enertiv. I’m here today to talk about some updates in NYSERDA’s RTEM incentive program.
For those of you who don’t know, RTEM stands for real time energy management. It’s an incentive program that helps landlords invest in advanced technologies to monitor and improve the efficiencies of their base building HVAC systems.
Due to the success of the program, the state has lifted the caps on a number of limitations that previously existed, both from a technology perspective and a portfolio perspective.
To start off, the cap used to say that each building can receive up to $150,000 in cash incentives per project. Now, it’s been lifted to about $400,000. So, while it used to cover $450,000 projects, now it’s for $1.2 million projects so larger landlords can make investments in the modernization of their HVAC systems.
In addition, it used to be that each portfolio could get 10 of their buildings covered. But NYSERDA wants to give access to larger portfolios as well, so it’s less about the portfolio, and more about the individual buildings accessing the incentives to improve their efficiency.
And then lastly, it used to be that the program was for existing office buildings. It was extended to multifamily buildings, and now recently extended to new developments as well.
In terms of technology, while it must be noted that to get the RTEM rebate, you still have to invest in base building HVAC monitoring, there are now other technologies that can be incentivized as well.
Among them, you can upgrade your tenant utility submetering program by converting mechanical meters to digital submeters, when packaged together with HVAC monitoring.
The incentive also covers the latest and greatest IoT building sensors. Whether it’s for temperature and humidity sensors, elevator diagnostics packages, boiler or chiller cooling tower sensor bundles for the sake of improving maintenance and energy efficiencies, the RTEM incentive can improve the pro forma of these new technologies.
As an example of why this is so exciting and where this makes sense. If you were to look at one of the projects we were working on recently, it’s a new development or redevelopment for an office building here in New York City. They decided to upgrade their submetering infrastructure. In a union building like this, that investment would cost at least $500,000.
Just to invest in a submetering platform and the metering infrastructure without the RTEM incentive, we’re looking at $500,000. You would receive the incentive if you would also invest in a HVAC base building monitoring package. We’ve estimated the cost to be $50,000 for large buildings such as these. So, the project cost if you include HVAC monitoring would be about $550,000.
BUT, it would also include the RTEM 30% cash rebate incentive. 30% of $550,000 is $165,000, which means that total project cost on the expanded scope is actually $115,000 less than the original scope without the packaged solutions.
Interested in taking advantage of the RTEM incentive? Contact us today!