Energy Efficiency Recommendations for Commercial Buildings

Electricity and gas bills represent a large share of operating costs in commercial buildings. However, most of the energy consumption can be attributed to a few building systems. Space heating and air conditioning account for over 50% of energy costs in most cases. Lighting systems can also consume a lot of power if they use inefficient lamp types – an old and inefficient lighting installation can represent over 25% of the power bill.

Energy efficiency measures offer a high return on investment in commercial buildings. When building upgrades are selected properly, every dollar invested upfront is recovered many times in the long run. With favorable loan conditions from a bank, it is even possible to upgrade a building for zero net cost. Energy efficiency measures can be deployed with loaned capital, which is paid back with the savings achieved.

LED Lighting Upgrades in Commercial Buildings

Energy consultants often recommend LED upgrades for commercial buildings, considering the long operating schedules of lighting systems. LED lighting can be deployed with minimal disruption, and its payback period is typically less than four years. When the existing lighting system is very old or the building has a 24/7 schedule, the payback period can be reduced to less than one year.

The electricity savings achieved with LED lighting depend on the lamp types being replaced:

  • Savings of over 80% can be expected when incandescent and halogen lamps are upgraded to LED.
  • When replacing HID lighting, savings above 60% are typical.
  • The potential savings are smaller when upgrading fluorescent lighting, which already has a decent efficiency. However, the upgrade is still cost-effective. Depending on the type of fluorescent lamps replaced, LED lighting can save between 20% and 50%.

LED lighting brings an additional benefit in air-conditioned spaces since it emits less heat than older lighting technologies. The effect is not significant when only one lighting fixture is considered, but commercial buildings can have thousands of them. As an example, assume an office building has 2,000 fluorescent tubes than consume 32 watts each. If they are replaced with 18-watt LED tubes, the lighting heat emission is reduced by 28,000 watts.

In addition to saving energy, LED lighting simplifies maintenance with its long service life. An LED tube normally has a service life of 50,000 hours, while an equivalent fluorescent tube only lasts around 20,000. The same applies to HID lighting, where bulbs that last 10,000 hours are replaced with LED versions that last 50,000 hours. These upgrades not only save energy, but also lamp replacements.

Improving Space Heating and Air Conditioning Efficiency

Many types of appliances and equipment use energy in commercial buildings, but space heating and air conditioning systems have the highest consumption by far. Energy efficiency measures that target these installations can achieve the highest savings.

A common approach to reduce HVAC costs is simply upgrading the equipment. However, better results are possible when the overall building performance is considered. Mechanical engineers weigh many factors that influence heating and cooling costs, other than the equipment itself:

  • Insulation and air sealing are very important. When a building is poorly insulated or affected by multiple air leaks, more energy is needed to keep a suitable temperature.
  • The type of windows used also affects performance. Single-pane uncoated windows provide the least insulation, while triple-pane coated windows can reduce heat gain and heat loss by over 70%.
  • The thermostat setting is important as well. According to the US Department of Energy, heating and cooling costs are reduced by 3% for every °F the thermostat is set back.
  • Note that “setting back the thermostat” has a different meaning depending on the season. A higher temperature setting saves energy in summer, and a lower setting saves energy in winter. In both cases, the workload on HVAC equipment is reduced.

When all these factors are considered for an HVAC upgrade project, even higher savings are possible. In commercial buildings, the highest cooling efficiency can normally be achieved with a water-cooled chiller or a variable refrigerant flow (VRF) system. Space heating costs can be reduced by upgrading to a boiler with a high Annual Fuel Utilization Efficiency, or AFUE. There are now boilers with an AFUE above 98%. As an alternative, many VRF systems are designed to also operate in heating mode.

Additional efficiency gains are possible by improving the ventilation system. For example, air handlers can be configured to reduce airflow when a commercial building is at partial occupancy. Since there is less air moving through the HVAC system, heating and cooling costs are reduced. A ventilation system that always delivers its full airflow regardless of occupancy not only wastes fan power, but also heating and cooling power.


Since every building is unique, the optimal combination of energy efficiency measures changes for each property. However, lighting retrofits and HVAC upgrades are cost-effective in most commercial buildings. A professional energy audit is the most effective method to detect the best energy efficiency measures for each property.