When purchasing residential real estate in New York City, you will most likely have to choose between a housing cooperative and a condominium. Understanding the difference between them is very important because it determines how many expenses are allocated, including building assessments and upgrades.

  • Housing cooperatives make up around 75% of the NYC residential market, and with this option you are really purchasing shares in a corporation, not an actual property. In other words, you become a shareholder in a company who owns the apartment where you live.
  • In a condominium, you purchase an apartment directly and get a title deed. Some common expenses are still split among all units in a building, but as the owner of an apartment you have greater decision power over how it is managed or upgraded.

The technical procedure for an energy analysis is generally the same regardless of the type of property, but there are differences in how the project is managed due to the ownership structure.

  • Residential units are individually owned in a condominium, so engineering services are more likely to be carried out per unit, rather than for an entire building. Engineering services may also be hired by the building management, but for common areas and systems.
  • In a housing cooperative, on the other hand, the entire property is managed by the co-op board. Therefore, engineering services and upgrades are more likely to be building-wide projects, including all dwelling units.

Electric Utility Bills

Each utility company has a different set of rules and formulas for calculating electricity bills, but the most important factor is generally the total kilowatt-hour consumption. It is important to note that electricity rates are not constant:

Hourly electricity rates:Utilities charge higher bills when grid demand is at its peak, to disincentive consumption at these hours.

Monthly electricity rates:Since energy consumption varies by season, utility companies normally adjust their rates accordingly. For example, electricity rates are higher in the summer because utility companies must handle the air conditioning load of the full city; the load is reduced in the winter because a significant portion of heating comes for gas and oil, alleviating the load on the power grid.

According to the Energy Information Administration, the average electricity consumption for a New York household is over 600 kWh/month, which translates into a bill of over $100/month. This provides a useful baseline to compare the bills of individual dwelling units: if an apartment exceeds these average values by a significant margin, it is likely that there are many energy-saving opportunities.

LED fixtures, heat pumps and building controls are among the most cost-effective upgrades for residential buildings: HVAC is generally the top energy expense, followed by lighting.

Water Consumption

According to the USGS, the average US citizen consumes between 80 and 100 gallons of water per day. Toilets are by far the plumbing fixture with the highest consumption, accounting for up to 27% of residential water use. This can increase significantly in the case of faulty toilets, where water is constantly running.

The Environmental Protection Agency has introduced the WaterSense program for plumbing fixtures, and those with the WaterSense label guarantee a lower water consumption than standard products.

Plumbing Fixture

Traditional 

WaterSense

Toilet 1.6 gal/flush <1.28 gal/flush
Showerhead 2.5 GPM <2 GPM
Faucet 2 GPM <1.5 GPM
Washing Machine 27 to 54 gal/load  

It is important to note that WaterSense fixtures that use hot water also provide energy savings. By reducing water flow, they corresponding heating load is reduced as well.

In 2016, New York City had water rates of $3.81 per 100cf and sewer rates of $6.06 per 100cf. The total cost is $9.87 per 100cf, which is equivalent to around 1.32 cents per gallon. Therefore, the savings potential is significant.

  • A four-person household consuming 400 gal/day, or 146,000 gal/year, would have yearly water expenses of $1927.
  • A 20 percent reduction in water consumption would be equivalent to 29,000 gallons less each year, saving $386.

Gas Heating in New York City

Given the high electricity rates in New York City, gas is generally a more economic heating option. Only high-efficiency heat pumps offer an operating cost comparable to that of gas heaters, and electric resistance heaters result in significantly higher energy expenses.

If gas is used for space and water heating, a residential consumer can expect monthly gas bills of around $150, for an average yearly total of $1800.

Reducing Utility Bills in Cooperatives and Condominiums

Although cooperatives and condominiums are managed differently, the energy-saving measures that can be applied in both case are very similar.

  • Lighting upgrades are cost-effective, and in New York City many LED products are eligible for generous rebates. In addition to offering energy savings, LED lighting reduces the burden on existing circuits, which can be of great help in older buildings where the installation was sized for small loads. The long service life of LED products also means lamp replacements become less frequent and maintenance expenses are reduced
  • Heating upgrades also offer an attractive return on investment. The efficiency of gas boilers and heaters is measured by the Annual Fuel Utilization Efficiency (AFUE), and tankless models generally offer superior performance than storage-based heaters. The efficiency of heat pumps is indicated by the Coefficient of Performance (COP) or Heating Seasonal Performance Factor (HSPF); the COP can be multiplied by 3.412 to convert it to a HSPF, if several products are being compared and not all of them use the same metric.
  • Air conditioning equipment may also use the COP, or a Seasonal Energy Efficiency Ratio (SEER). In the case of heat pump that can also operate in cooling mode, the COP values are different for heating and cooling.

Building Assessments for Each Type of Building

As stated before, the main difference between a cooperative and a condominium is property ownership, and this determines who is responsible for the final decision if energy or water assessments will be carried out.

Condominium owners can directly decide to carry out engineering assessments for their property. However, if the assessment is for a building-wide system, the project must be approved by the managers because none of the tenants owns that part of the installation. Some rules may apply for carrying out individual property assessments and upgrades, but the final decision rests on the owner nevertheless.

In cooperatives, where the entire property is owned by a corporation, everything must be approved by the board. If an individual tenant requires a property assessment, approval from the co-op board is a prerequisite. The board can also decide to carry out an engineering assessment on its own if building-wide issues are detected. For example, if electricity bills are too high, the board can get an assessment to determine how expenses are distributed among apartments.

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