carbonates

Homes vs. Businesses - Which Are Better Targets for Reducing Energy Use?

"Certainly commercial and industrial demand response represents "the easy stuff," said Rick Nicholson"

I agree that industrial users have good incentive to reduce energy usage. However, there are large parts of the commercial market that will have a very difficult time cutting energy usage. One of the major reason is the traditional way leases are handled in buildings with more than one tenant. Where the leases are triple-net, many of the costs of running the building are shared on a pro-rated basis by the tenants, leaving no incentive for the tenants to cut energy usage, as the other tenants might offset their savings. The landlord has no incentive to save money because they are not paying the energy costs, and upgrading equipment to save energy will be considered a capital improvement, not maintenance, so upgrading will provide no direct benefit to the property owner.