Expert: Jim Avancena, CPM - 6/7/2010

Question
I own a small 1600 squ. ft. Cafe. I am having issues with the utility charges assessed. I have monthly bills for metered Electrical usage and then HVAC reimbursement which is a calculation done by the head engineer of the building.
My electrical usage runs about $1500/month but my HVAC is over $3000/month. I have surveyed the businesses in the area and their bills are less than mine even though their spaces are at least twice as large as my space. In my 20 years of experience, I have never seen such a bill for the amount space I rent.

The lease has a short paragraph on Utilities. Mainly, I am to be charged for the metered electrical usage and an "estimate" will be used to bill for HVAC usage. I have contacted my landlord to understand how this makes sense. Just so you know, I closed an entire week due to Snow Fall this year and there was no difference in billing. The landlord has said they have called the utility company to check the meter -- they say the electrical meter is correct. They sent me a letter with lots of Load, Demand Load, Lease Hours (although I close earlier than they state), Run time, etc. which determines my HVAC usage.

Obviously, I am not an engineer. I understand little beyond the math itself. What is the best way to find a professional who can look at this data. The Landlord has finally acceded to having an independent expert look at the equipment, but I am having a hard time finding an appropriate person. Can you please help with this?

Also, I utilize 0.66% of the building. I have paperwork from the Landlord about the operating expenses. There is a section on annual utility expense. The amount I pay in HVAC alone is 10 times the percentage in terms of my occupancy. Would this be a valid reasoning to rebut my utility bill?

I am having a very difficult time with this burdensome expense. Can you offer any advice on how best to resolve this?

Thank you in advance for your thoughts.  Aimee

Answer
Aimee-

First, try to contact the people that leased the space you have before you did.  They may have had a similar problem before and be able to give you a tip that will solve this problem. You may also be able to ask some of the other tenants that have been in occupancy before you moved in and ask them if they know where the previous tenant is now, or ask the tenants if they have any idea what the problem might be.  If you go in person to the utility company that supplies the electrical power, they may be able to examine past consumption records and see if there might be any hints as to why your consumption is so elevated.

Also, who maintains the equipment that you utilize for your cafe?  Is the equipment in good operating condition?  The landlord may not wish to purchase new equipment for your cafe and just let you pay excessive consumption charges for it's old or worn out equipment instead.

Next, try turning off absolutely every piece of electrically powered equipment, light fixture, clock, refrigerator, oven, blender, TV, cash register, etc. (EVERYTHING!) and then go to your electric meter and see if the meter is recording that power is still being consumed.  If so, and you are certain that everything you use is turned off, it means that something else that consumes electricity is consuming electricity THAT YOU ARE PAYING FOR!

Hopefully, by this point you will have what you need to know to solve your problem by now.  If not, you may need to find a professional mechanical engineer that is familiar with this kind of operational and consumption situation in a commercial property.

You may be able to simply look in the yellow pages or contact the closest Mechanical Engineering Association.  You may also contact a convenient Bar Association office and ask if they have book or magazine they use to select experts for the cases they handle.   They will likely have a source that can put you in touch with a good PE.  The fact is that an experienced chief engineer at any major office building or complex nearby can probably determine what the problem is, however, you don't know the qualified chiefs in your area.  

Keep in mind that you don't need to hire the head of the Mechanical Engineering School at Drexel or others with razzle dazzle titles that have authored several books.  You only need an engineer that can handle this relatively straight forward and simple utility/equipment consumption puzzle.  Even a low level, adequate expert will have a promotional package of their qualifications that will require a wheel barrow to carry.  Don't worry, that is the nature of their occupation.  

Ask the list of potential engineer experts what they charge and tell them a bit about your situation, then listen closely to their response for whether they sound convincing and if they communicate in a easily understandable style.  If they sound like they are trying to show you how smart they are -you don't want them.  If they talk too much, you also don't want them.  

The engineer you hire will need to examine the equipment involved and the wiring, so select someone that is as close as possible (Don't hire one based in San Francisco and you have to pay the travel expenses!).  Additionally, be certain that your landlord will provide access to whatever your engineer wants to examine.  The engineer may also wish to see the landlord's electrical plans or "As Built" construction drawings of your cafe and the tenant's near your cafe.  If the engineer you choose arrives and your landlord won't let him see the plans or allow him access you the other tenants wiring and equipment - in addition to your own - you will have wasted the experts fee for that day.  Be certain to make all the appointments and arrangements necessary in advance, then be there at the times you arranged.  

Examining all the equipment (The engineer will write down a lot of numbers that are on the equipment)and wiring at the site will take less than a day and the remainder of the time the engineer will need to review your past billing paperwork and determine the critical facts. It will likely not take more than one day.  In fact, your engineer is likely be going through his examination of the equipment or wiring and suddenly say something like: "A hah! Here is your problem! Your meter is also recording the electrical consumption of the outlets and lighting fixtures in the ladies clothing department of the Kohl's Department store next door," or: "the motors on your air handling unit are old and nearly burned out, creating five times the design load" (These are just examples).  

You are doing fine in your pursuit of this problem.  You have good instincts.  Do what I have suggested IMMEDIATELY in the order I have described.  Let me know if there is anything else I can help you with by sending a follow-up question.  Keep me informed.

Good hunting.

- Jim