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Habitat Magazine Business of Management 2021




Switching from Oil to Natural Gas: The Process and What to Watch Out For

Ronda Kaysen in Building Operations on October 9, 2012

The Leonori, 26 E. 63rd Street, Upper East Side

Process of Switching from Oil to Gas
Oct. 9, 2012

The Leonori — a 13-story Beaux-Arts apartment building completed in 1901 and now home to the actor Samuel L. Jackson, restaurateur Vittorio Assaf and former Morgan Stanley CEO John Mack, among others — had hired Lewis Kwit, president of Energy Investment Systems, to do an energy audit, prompted by the new Local Law 84 benchmarking rule.

With the board having OK'd a switch to natural gas, property manager Steven Furman of Rudd Realty retained Kwit as a supervisor, paying him an $8,000 retainer. By September 2010, the building had hired mechanical engineer Ralph Germain, vice president of the Mount Vernon, N.Y. engineering firm Robert F. Germain. For $10,000, he drew up specifications that were ready within a month.

The building would need to build a gas meter room; install a sleeve in the foundation to which Con Ed could bring the gas line; install a ladder and platform to reach the sleeve; and buy a water heater and new burner.

The Leonori was able to save on one major cost: chimney improvements. Because the property has a metal stack chimney and not a brick chimney, it did not have to install a metal lining, which can cost $150,000. The Department of Buildings (DOB) prefers metal chimneys because condensation from natural gas eats away at brick and mortar.

Bidding, Waiting, Hoping

Once Germain delivered specifications, Furman put the job out to bid, a 90-day process. In March 2011, The Leonori tapped Controlled Combustion for the $155,000 job. The bid included installing the new sleeve, new gas service, gas booster, a burner, new controls and all new gas piping from the gas meter to the boiler. The building spent an additional $40,000 on the new hot water heater.

Initially, it seemed like the project was running smoothly. In June, the DOB issued permits. By October, all the internal work —  the sleeve, the new burner, and the gas meter —  was done. For residents, the work went unnoticed: "It was seamless in terms of the building. No one knew," says Sumner.

Next, Con Ed needed to rip up the sidewalk and bring gas to the building —  a cost borne by the utility company. "But then we hit a snag," Furman says. "And the snag was twofold."

The Leonori is ready to save

up to $50,000 a year from

the switch to natural gas.

The first snag was with city permits. For reasons no one specified to Habitat, Con Ed could only get weekend permits. So, what couldn't be finished on a given weekend had to wait until the following weekend. According to Con Ed, a weekend-only permit from the Department of Transportation (DOT) can make a week-long job take three or four. Additionally, if a tree is involved, Con Ed has to get a permit from the Parks Department, which has a much slower turnaround time than the DOT, according to Joe McGowan, a manager in the gas conversion group at Con Ed.

So, it wasn't until November that Con Ed workers opened up the street. And that's when things really went awry. Workers discovered asbestos in the pipes they uncovered. Before Con Ed could deliver gas to the Leonori, it had to abate the asbestos. "Until you open up the street you might not know what's there," says McGowan.


Suddenly, Thanksgiving was approaching. Thanksgiving marks the start of a moratorium on permitting for many non-essential street work projects. It lasts through Christmas. "To make a long story short, we didn't get this done until the end of February," says Furman.

That month, Con Ed abated the asbestos and finished the street work, bringing gas to the property line. Leonori's contractor brought it into the building, connecting it to the new burner.

In March, the DOB inspected the work, signing off on it so Con Ed could return and install a new gas meter. Before Con Ed would turn on service, however, the condo paid a $17,000 deposit for establishing a new gas account. The conversion was finished in April 2012.

The building is still waiting for a $52,000 rebate from the New York State Energy Research and Development Authority (NYSERDA). The rebate will arrive after the agency conducts its own inspection. The building is also waiting for a $20,000 rebate from Con Ed. Kwit, who filed all the paperwork, receives 20 percent of any rebates as part of his fee.

Finally, two years after The Leonori first began thinking about how it could reduce its energy usage, it is ready to save up to $50,000 a year.


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