Carnegie House Case Study

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More than 50 years after it was built, some aspects of Carnegie House weren’t aging gracefully. While its classic brickwork looked fine, many of the 21-story midtown Manhattan co-op’s mechanical systems were far past their prime and nearing failure. In consultation with Carnegie House’s board, building manager Chris Kelly took decisive action.

He hired EN-POWER GROUP, a Multifamily Performance Partner working with the New York State Energy Research and Development Authority (NYSERDA), to analyze the building’s energy use and recommend energy-saving improvements. Carnegie House embarked on a top-to-bottom energy efficiency upgrade project, making a range of improvements to mechanical and lighting equipment. Through NYSERDA’s Multifamily Performance Program, the building earned $197,000 in incentives and qualified for a loan at about half the market interest rate.

Carnegie House’s upgrades resulted in a 15 percent reduction in energy use—creating a yearly cost savings of more than $139,000, which is passed through to unit owners and adds up to an improved bottom line for all. In fewer than six years, the project will have paid for itself in savings.

Aging systems in dire need of updates

Carnegie House is a 317-unit building located around the corner from the famous music hall in midtown Manhattan that shares its name. The co-op building dates back to 1962 and, until recently, so did much of its mechanics. In 2009, key pieces of building equipment were underperforming and beginning to fail. Building manager Chris Kelly knew that Carnegie House needed an update.

Energy costs had risen, and Kelly realized he had an opportunity to improve Carnegie House’s energy efficiency as a whole, rather than simply replacing old equipment. The building contracted with EN-POWER GROUP, a NYSERDA Multifamily Performance Partner, to assess Carnegie House’s energy use and recommend a system-wide update. EN-POWER GROUP analyzed the property and found multiple causes of costly energy waste.

Making sweeping improvements, with some important help

EN-POWER GROUP recommended that Carnegie House invest in a comprehensive energy efficiency upgrade project, with NYSERDA’s Multifamily Performance Program. Kelly and the building’s co-op board agreed. Under EN-POWER GROUP’s supervision, contractors replaced Carnegie House’s absorption chiller, along with aging pumps, motors, pipes, ventilation fans and valves. Steam line leaks were repaired, and pipes were insulated. The upgrades were funded using NYSERDA’s cash incentives and low-interest financing.

Carnegie House also upgraded lighting in common areas and mechanical rooms, and added energy-saving motion sensors. A new building management system made it easy to keep the upgraded equipment running efficiently.

Passing savings on to residents

Carnegie House was able keep its mechanical systems in operation while installing the new upgrades, making the conversion virtually invisible to tenants. The project was a success, resulting in a 23 percent reduction in energy use and a major cost cut—more than $139,000 a year in energy savings. This cost control translates into significant savings - up to $475 per year - for individual residents, and the project will pay for itself in just five years.


Background & Challenges

  • 50-year-old mechanical system was escalating maintenance and energy costs
  • Leaky pipes, dated pumps, and inadequate ventilation system created energy waste
  • Incandescent bulbs and 24-hour building lighting added to energy costs


  • Upgraded ventilation system, pumps, motors and absorption chiller
  • Steam line leak repair and insulation
  • Energy-efficient lighting fixtures and motion sensors installed in common areas and maintenance room


  • Energy consumption reduced by 15 percent
  • $197,000 in incentives, plus low-interest financing from NYSERDA
  • Annual maintenance savings for tenants range from $250 to $475, depending on apartment size
  • Avoided failure of outdated mechanical system

Project Financials

Developer/Owner Carnegie House Tenants Corp.
Number of Units 317 rental units
Total Investment $788,818
NYSERDA Incentives $197,370
Annual Steam Savings 5,661 million Btu
Annual Electricity Savings 113,472 kwH
Total Annual Savings $139,197
Project Lifecycle Savings $1,238,943
Simple Payback 5.7 years
Savings to Investment Ratio 2.6