Page 25 - WaterSense at Work

October 2012
Water Management Planning
it is more common for ESCOs to bundle energy- and water-efficiency upgrades.
The utility cost savings from the projects pay for the projects themselves, and any
additional cost savings on top of the capital cost are shared between the service
company and the facility.
Look for state-specific financing programs. Many states have made water-
efficiency projects eligible for Property Assessed Clean Energy (PACE) financing
programs that are carried out by local governments.
Calculating Simple Payback
Simple payback, based on the project cost and anticipated annual water savings, can
be an effective metric for prioritizing potential projects and practices for inclusion
in the facility-specific action plan. In some cases, retrofitting or replacing equipment
can also save energy, further reducing the simple payback period and increasing
project cost-effectiveness. To calculate the simple payback for a specific project or
practice, gather the following information and use Equation 1-1:
Determine the total project cost that will come from the facility’s operating
budget. If an alternative source of funding is available, such as a rebate to offset
money spent from the facility’s budget, subtract it from the total project cost, as
it will make the project more cost-effective. The project cost should be the total
that will come directly from the facility’s budget only.
Estimate the water savings from the project, as calculated using equations in Sec-
tions 2 through 8 of
WaterSense at Work
Identify the cost of water and wastewater. In some cases, the water utility deducts
sewer charges for water that is not discharged to the sanitary sewer (e.g., water
evaporated from the cooling tower or water applied to the landscape). In these
cases, only consider the water cost when calculating simple payback of the project.
Equation 1-1. Simple Payback (years)
= Project Cost ÷ (Water Savings × Cost of Water andWastewater)
Project Cost (dollars)
Water Savings (gallons per year)
Cost of Water andWastewater (dollars per gallon)
If the project has an associated energy impact, determine the energy source (e.g., gas
or electricity) and utility cost. Calculate the energy impact and consider including it
in the simple payback calculation.
Page 6.
National Association of Energy Service Companies. Resources—What is an ESCO?
Database of State Incentives for Renewables & Efficiency. PACE Financing.