Background StoryThe client owns a 43-story residential building in Dubai Marina, comprising a mix of two-bedroom and three-bedroom apartments, as well as penthouses.
Previously, the building lacked a chilled water sub-metering infrastructure, meaning the client absorbed the entire cooling consumption cost and distributed it to tenants through service charges based on unit floor area.
To address this issue, the client engaged Ark Energy to oversee the design, procurement, rollout, and commissioning of BTU submeters for each tenant space. This initiative aimed to optimize cooling energy consumption, allocate costs accurately, and reduce delays in service charge collections.ProblemsAt the project's initiation, a key challenge was determining the cost factors that would influence the BTU service charges. These cost levers were categorized into two main groups, shaping the financial framework of the submetering system.
Main ObjectiveThe primary objective of this project was to demonstrate to the client the benefits of a properly implemented BTU submetering system through a cost-benefit analysis. This analysis compared baseline costs with projected costs under a commissioned submetering system.
ApproachThe findings from Ark Energy’s cost-benefit analysis indicated that the tower had the potential to save 126,000 AED annually in cooling consumption through the installation of BTU submeters.Figure 1 Forecasted annual cost savings (in AED), based on data from 2020, post BTU Submetering system implementation
Source: Ark Energy AnalysisTable 1 Feasibility Study Outcome| Feature | Outcome |
| Utility Cost Savings | 10% (126 kAED, Annual Reduction in energy costs versus baseline) |
| Total Project Value | 523,746 AED Medium (Includes Material and Labor cost (to be funded through a 3rd-party investor) |
| Investment Repayment Charge | 28 AED/month/apartment (Investment Repayment Charge to be paid as a monthly Investment Charge) |
| Payback time | 4.2 years |
| Contract Length | 10 Years |
Source: Ark Energy AnalysisTable 2 Different billing scenarios
Source: Ark Energy AnalysisBased on Ark Energy’s financial model simulations, and from the scenarios mapped out for different billing options, the final recommendation was to go ahead with the project and install BTU submeters, while choosing Option 3 for the Billing Collection system, which includes the following: •Energy Cost Recovery
•AMCs Recovery
•Contingency Cost Recovery for HVAC Network and Chiller Plant
