Traverse City Record-Eagle

January 9, 2013

Utility willing to help hotels save on bills


TRAVERSE CITY — Traverse City Light & Power may provide a jolt worth $232,000 to its hotel and motel customers to help them reduce their electric bills.

The board for the city-owned utility reviewed a proposal Tuesday to cut summer's peak electrical consumption by reducing the use of air conditioning in hotel rooms. The proposal from Franklin Energy Services LLC, the utility's energy savings consultant, would retrofit the thermostats for about 725 hotel rooms plus provide energy efficient light bulbs.

"It will help our customers save money and, over time, help the utility save the cost of purchasing additional capacity," said Jim Cooper, TCL&P's energy and communications manager.

The typical hotel guest fires up the air conditioning when they enter a room and runs it on high all day long, said Jim Mooney, the Michigan manager for Wisconsin-based Franklin Energy. Franklin Energy proposes to install heat and motion sensors in guest rooms that would automatically raise the thermostat in the summer when the room is empty and drop the temperature in the winter.

Mooney said Franklin Energy would target smaller, independent hotels where heating and air conditioning can account for up to 80 percent of their energy needs. Most of the larger chains and newer hotels have already incorporated similar systems.

The board debated whether to charge a $50 per room co-pay after doing the first 10 rooms of a hotel for free. The installed cost of the thermostat units is $330.

The co-pays reduce the participation rate and make the project more complex, Mooney said.

Board chairman Pat McGuire said Tuesday TCL&P should drop the co-pay if they want to reach their energy savings goals, but reversed course on Wednesday.

"If hotel-motel owners aren't inclined to do it on their own, you have to start wondering how valuable it is," McGuire said.

The program should save hotels about $100 a year in energy costs per room, Cooper said.

The industry specific program would be part of TCL&P's $784,000 budget to help commercial and residential customers reduce electrical usage, Cooper said.

State law requires TCL&P to reduce annual energy consumption by 2.5 million kilowatt hours and recommends it spend 2 percent of annual revenue, $384,000, to meet the goal. The TCL&P board boosted funding by $400,000 and has already hit 3.5 million kilowatt hours. The hotel program is expected to save an additional 1 million kilowatt hours.

The board will vote on a final proposal from Franklin Energy at its next meeting.