Why New Jersey Facilities Should Take a Closer Look at Replacing their Boilers and Rooftop Units

In the past, taking a close look at boilers and rooftop units could be painful for facility and building managers. After all, this equipment is expensive and often has a long payback period.

However, the New Jersey Clean Energy Program (NJCEP) has turned this painful equipment replacement into a – if not pleasant then certainly – financially viable opportunity.

Under the NJCEP small business direct install program, organizations can qualify for rebates on energy-efficient rooftop units and boilers up to 70% and 80% respectively . . . that’s definitely worth a closer look!

And if the financial opportunity isn’t sufficient to entice you, then keep in mind that lead times for boilers could be from 8-12 weeks (condensing boilers) to 30 weeks (steam boilers) to 52 weeks (rooftop units).

About the Program

Through the small business direct install program, New Jersey facilities with an average annual electric demand of 200 kW or less are eligible to receive incentives on energy-efficient replacement equipment through your local utility company. Boilers and gas heat rooftop units typically have a significant opportunity for energy rebates – based on CM3’s experience with qualifying several of its customers – both can obtain incentives in the range of three-quarters of the total cost of the installed equipment.

Even better news is that the process for qualifying for the rebates is straightforward, CM3 will coordinate the entire effort for you:

  1. Assessment: Customers obtain a no-cost energy assessment from a Trade Ally (like CM3). The proposal will detail the total cost of the project, the amounts of all eligible incentives, and the total balance that will be owed. (Total project cost – incentives = total amount owed by customer).
  2. Installation: Customers determine which energy savings measures to pursue and then contract with the Trade Ally to install those energy-saving upgrades. The local utility company (through a program management partner) will conduct pre- and post-inspections of the work to ensure the job was completed in keeping with program rules.
  3. Payments: The customer pays for its portion of the project cost, and the customer’s utility company pays for the incentive portion of the project cost: Total project cost = Incentives (paid by utility company) + Customer Portion (paid by the customer).

    Additionally, the customer has the option to finance their portion of the bill rather than pay it outright. The financing is provided by the utility company through the On-Bill Repayment (OBR) plan, which is a five-year, interest-free-financing plan. Both equipment and labor costs can be included in the OBR plan.

    For most customers, OBR is a highly attractive option. Although the overall utility bill increases (to cover the cost of the new equipment that was not covered by incentives), the energy usage decreases, and this helps to offset the cost of the equipment that was purchased. In essence, the OBR functions like a mini-ESCO, with energy savings paying for equipment investments.

What to look for

There are a few signs to look for when determining if your system is due for a replacement.

  1. AGE: Even the best commercial boiler or RTU will not last forever. Boilers typically last up to 25 years, whereas RTUs last 15 – 20 years. However, the older the unit is the less energy efficient it will be. So even though they may last a long time, if your system is nearing the end of its lifespan, it may be time to look at a replacement before it completely shuts down.
  2. HARD-TO-FIND PARTS: Along these same lines, if parts are difficult to find for your system, then that is an indication that the system is antiquated and likely due for an upgrade.
  3. RISING ENERGY COSTS: If you notice higher utility costs than usual, this might mean that the system is not operating at full capacity. Although a small repair might suffice, heating and cooling equipment does not perform as well as it gets older.
  4. noises and odors: These are both signs that the system is not operating at peak performance. Although boilers do make noises, loud bangs or clanging can be an indication that there is a blockage or pressure issue. And, odors should definitely not be emanating from the system.
  5. LEAKS: Leaks and/or requiring extra makeup water are both symptoms of a problem that needs to be investigated. While leak repairs are feasible, other system issues combined with the clean energy incentives may make replacement the better option.
  6. COMFORT ISSUES: Comfort is a good indicator of HVAC system health, and an older system may heat areas unevenly at different times of the day. Similarly, humidity changes can also be an indicator of problems or obsolescence.


CM3 has extensive experience working under the NJCEP Small Business Direct Install Program to identify approved, energy-efficient equipment upgrades. Please reach out for a consultation.