New Report: Energy & Water Savings Hidden in Laundry Rooms

It turns out the laundry room in apartment buildings is good for much more than meeting neighbors and cleaning clothes.

new report by Rebecca Schaaf and Ruchi Shah of SAHF (Stewards of Affordable Housing for the Future) highlights the value from energy and water savings that is available. The report gives useful guidance to building owners who pay the electricity, gas, and water bills for the laundry machines, but the most interesting and actionable insights are for electric, gas, and water utilities.

Apartment buildings in the U.S. are home to millions of clothes washers and dryers in common area laundry rooms. These machines use an enormous amount of electricity, gas, and fresh water every year. More to the point, these machines waste enormous amounts of energy and water every year. Therein lies a bit of a mystery that led to this new study. Why do building owners continue to buy old-model, inefficient laundry machines? Building owners can save much more from lower utility expenses for electricity, gas, and water than the cost of the new, better machines. Why do apartment building owners not routinely install ENERGY STAR® washers and dryers?

First, note how washer and dryer manufacturers achieve the Energy Star certification: they use high-efficiency motors, front-load designs that use much less water, high-speed spin controls so the washer removes more water before drying, and moisture sensors in the dryer to set drying times. Energy Star machines use even less energy and water than the Department of Energy’s recent minimum efficiency standards for clothes washers. (See this fact sheet for more on how standards help to drive innovation among manufacturers, and this fact sheet for more on the great value delivered by the Energy Star program.)

The new report found that the key to the problem is that apartment building owners frequently do not buy the machines—they lease the laundry machines from vendors. In the most common arrangement, the vendor owns and maintains the machines, and the owner and vendor split the fees paid by the user (from a coin box or credit card reader). The owner pays the higher cost of water, electricity and gas used by old machine designs, but owners rarely track utility usage in laundry rooms, so the potential savings is hidden. 

SAHF’s analysis shows how building owners could save money by simply re-negotiating their deals with laundry vendors to require vendors to install new high-efficiency machines. The owner would give the vendor a larger fee split to cover the higher cost of the better machines, and the owner would realize even larger savings from lower utility bills over the life of the machines.

But SAHF also found that for many owners, the total utility savings are hard to verify (since laundry rooms are rarely sub-metered) and might not be large enough to spur owners to action to renegotiate their lease deals.

This is where the report provides the most helpful guidance. The energy and water savings at stake strongly suggest utilities should participate in the transaction with market-based incentives to help capture the savings. 

Many electric, gas, and water utilities already offer incentives to help their customers install high-efficiency washers and dryers because incentives cost less than paying to deliver power and water that will be wasted in old, inefficient appliances. For example, Alliant Energy in Iowa will give customers a $200 rebate for installing a high-efficiency commercial clothes washer. (See a list of such programs here). Utility efficiency programs help improve the entire utility system, which is good for all the utility’s customers. (For a more detailed description, see this fact sheet.) 

SAHF’s report offers two specific points to help utilities reach apartment building owners:

  1. Assure that incentives are available to the owner of leased machines. In many cases, rebates are only available to the owner of the machine, which puts the decision in the hands of the vendor who is not in a position to realize the savings from lower utility expenses.
  2. Assure that the utility offering the incentive (or other program administrator) gets credit for the savings in electricity, gas, and water from the high efficiency laundry machines. In many states, incentives offered by an electric utility, for example, must be calibrated to the value of the saved electricity. When the same measure saves water, for example, as is the case with laundry machines, utility regulators can assure the incentive appropriately reflects the full value of the savings.

This new report is a very useful reminder that energy and water savings can be found across the entire utility system.  When we regularly read headlines about cool new energy technology and innovation, such as new battery technology, electric cars, wind and solar breakthroughs, and more, it's easy to loose sight of the large savings opportunities in more humble areas. The new report highlights the opportunity we have in the quotidian laundry room. It might, in fact, give new meaning to the term clean energy.

About the Authors

Philip Henderson

Senior Financial Policy Specialist, EEFA, Resilient Communities, Healthy People & Thriving Communities Program

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