Plugging energy leaks in urban buildings

With a little caulk and a little insulation, you could squeeze quite a bit of oil out of the Big Apple -- and the rest of the nation's cities.

By the year 2000, economical conservation measures applied to America's urban buildings could save an amount of energy equivalent to two-thirds of current US oil imports, concludes a report by the congressional Office of Technology Assessment (OTA).

''This study of the energy efficiency of buildings in cities has a double focus, arising both from concern about the nation's cities and the viability of their building stock and from concern about the nation's energy future and the prospects for increased energy efficiency in the building sector,'' the detailed , 360-page analysis begins.

Each year urban America devours an amount of energy equivalent to 2.6 billion barrels of oil, or 700 million tons of coal, or the output of 126 giant nuclear power plants. Increasing energy bills have been blamed for an increase in the abandonment of inner-city buildings and are considered to be a major factor in the economic problems facing many Eastern cities.

Investing in improved efficiency could cut this tremendous energy appetite in half, OTA research indicates. While such savings are technically possible and economically feasible, the study is not sanguine that such investments will be made. Only 40 percent of these savings are likely to occur due to actions by the building's owners, the study estimates. Uncertainties over the effectiveness of energy conservation efforts for any given building and lack of incentives or money to make such improvements are the major impediments OTA identifies.

In general, small frame houses, multifamily buildings with central heating and cooling, and most commercial buildings can save substantial amounts of energy with conservation measures that pay for themselves in two years or less. Row houses, multifamily buildings with decentralized heating and cooling systems , and older commercial buildings with water or steam heat and window air conditioners, on the other hand, normally require more expensive measures that take as much as seven years to pay for themselves, the report finds. A study of recent retrofits in urban buildings found that in 90 percent of the cases the measures paid for themselves within three years.

No matter how effective energy conservation measures may be, if building owners don't pay the bill or don't have the money, they probably can't or won't take advantage of them. Thus, OTA researchers conclude that buildings owned by insurance companies, large corporations, and syndicated partnerships will take advantage of energy conservation.

Small businessmen and owners of apartment houses, on the other hand, are extremely limited by cash-flow problems, particularly in a period of high interest rates. And owners of buildings where the tenants pay the utilities have little incentive to reduce energy consumption. Also, public buildings like schools and city office buildings, because of limited access to capital, have tried to reduce energy consumption by changing the way they operate rather than making large energy-saving investments.

Currently, the federal government underwrites residental energy conservation through tax credits. These cost the Treasury about $440 million per year in lost revenue.

Increasing this subsidy to commercial and multi-family buildings by decreasing interest rates by 2 to 3 percent and extending the loan terms -- a measure that would alleviate much of the small businessman's cash flow problems -- would cost an additional $600 million per year, encourage about $40 billion in energy conservation investments, and in a decade reduce annual urban energy consumption by a million barrels per day oil equivalent, the OTA study calculates.