Implementing IoT (Internet of Things) solutions for monitoring and controlling utilities can yield substantial cost savings in water, electricity, sewer, gas, and HVAC usage.
This analysis provides data-backed justification for IoT adoption across five major U.S. cities – New York, Los Angeles, Chicago, Houston, and San Francisco – focusing on utility rates, the business size thresholds where IoT becomes financially compelling, and ROI estimates for key sectors (retail, hotels, offices).
The goal is to equip CFOs and financial decision-makers with clear evidence that IoT-based efficiency is not just sustainable but economically essential.
Bottom Line Up Front
Utility prices in most cases mean even moderate inefficiencies translate to real dollars. For example, 1 CCF of wasted water in NYC (~748 gallons) costs a business ~$12 in water/sewer charges (Rates & Regulations - Water Board); in LA, closer to $15.
Every 1,000 kWh of unnecessary electrical usage in California costs ~$182; in New York ~$177; even in cheaper Illinois it’s ~$115. These recurring expenses establish a strong baseline for IoT savings potential.
When Does IoT Make Financial Sense? (Thresholds by Size)
IoT implementations require upfront investment (sensors, devices, software integration), so a common question is: at what point (in building size or headcount) do the savings justify the cost? Key factors include the building’s square footage, occupancy, and baseline utility consumption:
- Building Size Threshold: Large facilities tend to waste more absolute energy/water, making IoT controls more immediately cost-effective. Traditionally, buildings larger than 50,000 sq ft were the domain of full Building Management Systems (BMS).
In fact, over 90% of U.S. commercial buildings under 50k sq ft lack a proper BMS to manage energy, even though the average commercial building wastes ~30% of the energy it consumes.
IoT now bridges this gap by offering “lighter” solutions suitable for smaller buildings. Modern IoT-based systems are wireless and modular, avoiding the high CAPEX of traditional BMS. This means even buildings less than 50k sq ft or with modest staff can achieve ROI, whereas before they couldn’t justify a full-scale automation system.
Headcount and Usage: More employees typically mean more devices, lighting, HVAC load, and water use (restrooms, etc.). However, headcount correlates imperfectly with usage – square footage and operating hours are better metrics.
For example, a 10,000 sq ft retail store with 5 employees open 90 hours a week may use far more energy than a 20,000 sq ft office with 50 employees that operates 40 hours a week. IoT becomes compelling when a business’s annual utility bills are high enough that a 10–20% savings offsets IoT project costs within a few years.
In practice, many find this threshold at roughly $50,000+ in annual utility spend, which could correspond to a ~20,000+ sq ft office or a 50,000 sq ft retail building (depending on usage intensity) . At that point, even a modest percentage savings translates to thousands of dollars.
An average U.S. retail building uses ~14.3 kWh electricity and 30.9 cubic feet of gas per square foot yearly (Average Electric Cost for Retail Store).
That equates to about $1.76 per sq ft per year in energy costs (using national average $1.47 for electricity + $0.29 for gas). A 50,000 sq ft retail store spends roughly $90,000/year on energy. If IoT solutions (smart thermostats, lighting controls, etc.) can save ~15%, that’s ~$13,500/year saved.
Even after equipment and installation, this size store sees a payback in under 2 years. Smaller stores (5,000–10,000 sq ft) with maybe $10k–$20k annual energy bills might see a longer payback (3–5 years), but often still within the useful life of the IoT equipment.
Office buildings have slightly lower energy intensity than retail. A 100,000 sq ft “large” office uses around 20 kWh of electricity and 24 cubic feet of gas per sq ft annually, costing on the order of ~$4 per sq ft (depending on local rates). That’s ~$400,000/year in utilities.
Even a 20,000 sq ft office (perhaps ~100 employees) might spend $80k/year. As with retail, once you cross roughly five figures in annual utility costs, IoT controls become a “no-brainer” – many offices easily meet this with just HVAC and lighting. Notably, small offices (less than 5,000 sq ft) using ~13 kWh/sq ft (Small and Midsize Offices - Orlando Utilities Commission) might have annual bills in the single-digit thousands; IoT can still help, but the financial “burn” is less acute.
In those cases, IoT is often justified more by comfort, sustainability goals, or preventive maintenance than immediate cost savings.
Bottom line:
If your business occupies a mid-size or larger space – e.g. >10,000 sq ft for retail, >15,000 sq ft for offices, or any size hotel – you likely have enough utility expense that IoT improvements will pay for themselves quickly. Even smaller footprints with energy-intensive operations (restaurants, data closets, etc.) can benefit.
The days when only skyscrapers or factories could justify automation are over – IoT has lowered the entry barrier so that small and medium businesses can see ROI as well (How is IoT enabling energy savings with quick ROI? - Zenatix by Schneider Electric) (How is IoT enabling energy savings with quick ROI? - Zenatix by Schneider Electric).
Business Category Breakdown
Let’s examine how IoT-driven efficiency plays out in three key business categories – retail, hotels, and offices – which each have different usage patterns and opportunities. We’ll identify typical cost structures and how IoT can cut waste, with an eye on break-even points.
Retail Spaces (Shops, Malls, Big-Box Stores)
Usage Profile: Retail properties consume about 18 kWh of electricity per sq ft annually on average (Why Retail Property Owners Should Consider Energy and Water Upgrades - Lone Star PACE) (or ~14.3 kWh according to EIA (Average Electric Cost for Retail Store [+ How to Cut Your Bill]), varying by source) and significant heating fuel for large spaces.
A notable ~60% of that energy goes to lighting and HVAC (Why Retail Property Owners Should Consider Energy and Water Upgrades - Lone Star PACE) – lighting alone often ~25% (Why Retail Property Owners Should Consider Energy and Water Upgrades - Lone Star PACE). Water use in retail is relatively low (primarily restrooms and maybe landscaping), but can still add up in malls or stores with public facilities.
Costs: As noted, U.S. retail spends about $1.47/sqft on electricity and $0.29/sqft on gas annually (Average Electric Cost for Retail Store [+ How to Cut Your Bill]) (climate dependent).
In high-rate cities like LA or SF, that electricity cost can double. Lighting, cooling, and heating comprise 70–84% of a typical retail building’s energy use (Average Electric Cost for Retail Store [+ How to Cut Your Bill]), meaning efficiency here yields big wins.
IoT Opportunities: Smart lighting systems (LED retrofits with IoT controls, occupancy sensors, daylight harvesting) can dramatically cut lighting waste – e.g. dimming or shutting off lights in unoccupied store sections or after hours.
Smart thermostats and HVAC controls adjust temperatures based on occupancy or even foot traffic patterns. IoT sensors on refrigeration units can optimize defrost cycles and alert to energy-wasting faults (important for grocery retail).
Savings & ROI: Energy audits frequently find 15–25% savings potential in retail via efficiency (Why Retail Property Owners Should Consider Energy and Water Upgrades - Lone Star PACE). IoT control of lighting/HVAC can often realize 15–20% reduction in energy use without compromising comfort or sales ambiance.
For a big retail store spending $90k/year on energy, a 20% cut saves ~$18k annually – directly boosting profit. Payback periods are often in the 1–3 year range for IoT lighting and HVAC upgrades in retail. For example, simply optimizing lighting schedules and HVAC setpoints with IoT can shave thousands off the monthly bill for a big-box retailer.
Financing tools like C-PACE are even enabling immediate positive cash flow by spreading project costs, reinforcing that these upgrades “pay for themselves.” In short, for retail chains and large stores, IoT-based energy management is financially compelling – it turns one of the largest operating costs into an opportunity for savings.
Hotels and Lodging
Usage Profile: Hotels are utility-intensive, operating 24/7 with varying occupancy. U.S. hotels and motels consume roughly 14 kWh of electricity and 49 cubic feet of natural gas per square foot each year (Solved Hotels and motels typically use an average of 14 | Chegg.com) – one of the highest energy intensities of any commercial building. They also use large volumes of water for guest rooms (showers, toilets), laundry, pools, etc., all of which then require sewer treatment.
Costs: Utilities can account for 4–6% of a hotel’s operating costs or more. Using the above usage figures, a 100,000 sq ft hotel (around ~150 rooms, 4 floors) might use ~1.4 million kWh and 4.9 million cubic ft of gas annually.
At California rates (~18¢/kWh, ~$1/therm), that’s on the order of $300k+ per year in energy costs. Water/sewer bills in a large hotel can also be hefty (millions of gallons per year). This high baseline means even single-digit percentage improvements yield big dollar savings.
IoT Opportunities: Hotels benefit greatly from smart HVAC and occupancy-based controls. Guestrooms are often unoccupied for large parts of the day – IoT occupancy sensors and smart thermostats can set back temperature setpoints when rooms are empty or guests are asleep, without compromising comfort.
Smart hotel thermostats and integrated energy management systems (EMS) have proven especially effective: they continuously analyze thermal behavior, weather, and peak loads to optimize HVAC in real-time () (). IoT leak sensors on pipes and fixtures can catch running toilets or drips that would otherwise go unnoticed (important for water conservation).
Common area lighting, pool pumps, and even kitchen equipment can be IoT-scheduled or monitored for efficiency. Hotels also leverage IoT for predictive maintenance – e.g. sensing when a chiller or boiler is losing efficiency and needs tune-up, avoiding energy waste and downtime.
Savings & ROI: The potential is dramatic. Smart energy management systems (like Verdant’s hotel IoT solution) can reduce hotel energy costs by up to 20% (). Hotels that have deployed IoT thermostats and occupancy sensors routinely see 10–20% heating/cooling savings with payback periods of 12–24 months – among the fastest in the industry (). For instance, a case study showed a hotel cutting 20% of its overall electric bill, translating to ~$14.5k saved in the first year for one limited-service property ().
Those savings continued each year, essentially paying back the IoT investment quickly and then compounding. Another analysis by Schneider Electric’s Zenatix notes that IoT-based building solutions often achieve ROI in 12–18 months, whereas older BMS took 3–5 years (How is IoT enabling energy savings with quick ROI? - Zenatix by Schneider Electric). Beyond energy, water savings (from detecting leaks or optimizing laundry cycles) can add to the ROI – and in cities with Tiered water rates or fines for overuse, avoiding waste has direct payback.
In many cases, large hotels see annual savings in the six figures, meaning IoT investments can pay for themselves in well under 2 years and then continue saving money long-term.
Offices (Corporate and Commercial Office Buildings)
Usage Profile: Office buildings primarily use electricity for lighting, computers, and HVAC, and use natural gas or steam for heating. Occupancy is typically 8–12 hours on weekdays, with off-hours presenting big savings opportunities.
Energy use intensity for offices averages 15–22 kWh per sq ft/year (lower for small offices ~13 kWh, higher for large offices ~20 kWh) (Small and Midsize Offices - Orlando Utilities Commission) (How Much Power Does An Office Building Use? - Remote Fill Systems), plus heating fuel. Water use in offices is mostly sanitary (bathrooms) and some cooling tower water for HVAC in larger buildings.
Costs: For an office tower in NYC or SF, annual electricity bills can reach millions of dollars.
Even a 50,000 sq ft office in Chicago might spend on the order of $100k/year across electricity and heating. Notably, about 30% of the energy in the average office is wasted due to inefficiencies (Small & Medium Buildings Report | Honeywell) – e.g. lights left on, HVAC running in empty spaces, etc.
IoT Opportunities: Offices can leverage a suite of IoT solutions: Smart lighting systems that dim or shut off lights in unoccupied rooms or when daylight is sufficient; occupancy sensors and scheduling to power down HVAC in zones that are empty or after hours; smart plugs to cut power to idle equipment (copiers, coffee machines) overnight; and air quality sensors to optimize ventilation (bring in fresh air only as needed rather than running fans full-time).
Modern AI-driven building management can even adjust in real-time – for example, learning daily occupancy patterns and reducing HVAC output in lightly used areas to save energy, or pre-cooling a building just enough to avoid a demand charge peak (AI-Powered Building Systems Are Slashing Energy Costs by 30% - Industrial Build News) (AI-Powered Building Systems Are Slashing Energy Costs by 30% - Industrial Build News). Predictive maintenance via IoT (monitoring vibration/efficiency of fans, pumps, compressors) prevents equipment faults that can cause energy spikes.
Savings & ROI: Smart office implementations regularly achieve 15–30% energy savings compared to traditional control (AI-Powered Building Systems Are Slashing Energy Costs by 30% - Industrial Build News). A McKinsey study found that connected building technologies can trim office building energy use by 20–25% on average (and up to 50% in some cases) (Next-gen smart buildings will run cheaper and greener - Autodesk).
These reductions have huge ROI because offices often pay premium rates for peak usage – IoT systems that shave peak demand (e.g. by precooling before peak hours and dialing back at expensive times) directly reduce utility bills.
Many offices see a payback in ~2 years or less for lighting + HVAC IoT retrofits. For example, an AI-based HVAC optimization in an office portfolio can yield ~30% savings with ROI under 3 years (Smart Building - IOT solutions - Ewattch), and some IoT providers advertise ROI less than 3 months for certain optimizations in commercial buildings (Smart Building - IOT solutions - Ewattch) (likely in very wasteful pre-IoT scenarios).
Even small offices benefit: cloud-based IoT building platforms are allowing small/medium offices to get BMS-like savings (20–30% cuts) at a fraction of the cost (How is IoT enabling energy savings with quick ROI? - Zenatix by Schneider Electric) (How is IoT enabling energy savings with quick ROI? - Zenatix by Schneider Electric).
One whitepaper noted a small office pilot that achieved 29% energy savings in under 3 months using an IoT retrofit (Small & Medium Buildings Report | Honeywell). The bottom line for offices is that IoT not only pays for itself but often contributes to significant operational cost reduction, improved occupant comfort (which can indirectly boost productivity), and even higher property value – efficient buildings command higher rents and asset values (Impact of Energy and Water Savings on Multifamily Properties | WegoWise) (Impact of Energy and Water Savings on Multifamily Properties | WegoWise).
Other Industries with Strong IoT Justification
While retail, hospitality, and offices are prime candidates, many other industries also see exceptional ROI from IoT-driven efficiency:
- Manufacturing & Industrial: Factories and industrial plants often have massive energy consumption (electric motors, process heat, compressed air systems) and water usage (for cooling or processes).
IoT sensors enable predictive maintenance (avoiding inefficient operation and downtime) and continuous energy monitoring. According to Deloitte, IoT-based predictive maintenance can cut maintenance costs up to 25% and reduce unplanned downtime by up to 50% (Investing in the Future: How Predictive Maintenance Can Drive ROI) – improvements that directly protect revenue and reduce waste.
The ROI here comes not only from utility savings but from increased production uptime. Many manufacturers see IoT projects pay off within 1–2 years just from maintenance savings and energy efficiency (e.g. shutting off idle equipment, optimizing HVAC in warehouses, etc.).
Industrial facilities also often face demand charges; IoT controls can stagger equipment startups and reduce peak load, saving on those charges.
- Data Centers & Tech Facilities: Data centers are energy hogs (powering servers and cooling them). IoT sensors and AI can optimize cooling systems (HVAC) – for example, adjusting setpoints and airflow to match server load or using outside air cooling when conditions allow.
Even a 1% improvement in PUE (power usage effectiveness) can translate to tens of thousands of dollars in large data centers. IoT monitoring can also prevent thermal runaway or pinpoint hot spots to avoid overcooling.
Many data centers have implemented IoT-driven dynamic cooling and seen payback in well under 2 years due to the enormous energy baseline.
- Healthcare (Hospitals): Hospitals operate 24/7 with intensive HVAC and water demands (sterilization, laundry, etc.). They often have older infrastructure that runs continuously.
IoT building management in hospitals can safely reduce HVAC usage in unoccupied zones (or at night in administrative areas), monitor medical refrigeration units, and detect water leaks (important for infection control and cost).
Given that hospitals in high-cost regions can spend $5–$10 million a year on utilities, even a 10% savings is huge. Many hospitals are finding IoT upgrades (sometimes funded through energy performance contracts) that deliver ROI in ~3 years and then free up funds to reinvest in patient care.
- Multifamily Residential: Apartment complexes and commercial residential buildings benefit from IoT through smart thermostats, leak detectors, and boiler controls. While not “industrial,” this sector sees strong financial cases for IoT because utility costs often either eat into NOI or are passed to tenants who demand efficiency.
Analytics on energy and water use in multifamily buildings can increase NOI and property value significantly, with benchmarking software creating payback in mere months for owners (Impact of Energy and Water Savings on Multifamily Properties | WegoWise). For example, finding and fixing water leaks or insulating a building after IoT data analysis can yield immediate savings that increase an apartment building’s net income (and thus its appraised value) by hundreds of thousands (Impact of Energy and Water Savings on Multifamily Properties | WegoWise) (Impact of Energy and Water Savings on Multifamily Properties | WegoWise).
- Agriculture and Irrigation: In farming, IoT soil moisture sensors and smart irrigation systems drastically reduce water usage (sometimes by 30–50%) while improving crop yield. Water is a major cost in agriculture; IoT systems often pay for themselves in one growing season by eliminating overwatering and runoff.
This may be outside typical “business office” environments, but for agribusiness CFOs the financial logic is analogous: spend on IoT to save on water (and energy for pumping) – it’s a quick ROI and hedges against drought risks.
In each of these sectors, IoT projects are often self-funding through savings. A telling statistic: 92% of enterprises report positive ROI from IoT implementations, according to a wide-ranging survey (75F: The World's Most Advanced IoT Building Automation).
The industries above are standouts because their pre-IoT utility costs (or maintenance costs) are so high that even modest efficiency gains translate into big financial wins.
ROI Estimates and Payback Periods
A data-backed financial analysis is critical for CFO approval. Fortunately, IoT efficiency investments generally have attractive ROI profiles. Here are some key points on returns and payback periods, along with examples:
- Typical Payback: Most IoT energy management projects for buildings see payback within 1 to 3 years. Lighting retrofits with IoT controls often pay back in ~1–2 years (thanks to power savings and utility rebates).
HVAC IoT upgrades are often 2–3 years unless major equipment replacement is involved. These periods are well within the lifespan of the equipment, meaning strong net present value.
In fact, IoT-based solutions often outperform traditional capital projects on ROI – for example, IoT controls (12–18 month payback) vs. a chiller replacement (maybe a 7+ year payback).
- Fast Payback Cases (Months, Not Years): There are numerous instances where IoT projects have paid for themselves in a matter of months. For example, an IoT retrofit in a large commercial building that optimized cooling and lighting achieved 15% energy savings (~400,000 kWh/year) and paid back in just 5 months (Energy Efficient Cities: Building-Level Solutions, Microgrids and IoT).
Another case: a building analytics software identified operational tweaks that created an immediate reduction in utility bills, achieving payback in under 6 months (Impact of Energy and Water Savings on Multifamily Properties | WegoWise). These “low-hanging fruit” scenarios are not universal, but they highlight that some IoT improvements start contributing to the bottom line almost immediately.
Usually, fast-payback items include things like scheduling controls (which cost little to implement but save a lot by turning things off) and fixing blatant issues (like a mis-programmed HVAC system running 24/7).
It's not uncommon for IoT investments to become net-positive within the same fiscal year of implementation for the most wasteful facilities.
- Multi-Year ROI and TCO: When evaluating multi-year impact, IoT shines even more. A project with a 2-year payback yields a 50% annual ROI; over a 10-year period, that’s a huge cumulative return.
IoT systems also often extend equipment life (through reduced run-time and predictive maintenance), which avoids capital expenditures – those avoided costs effectively improve the ROI when viewed holistically. For instance, if smart monitoring prevents a $50k catastrophic failure of a boiler that would have happened in year 3, that “saving” should be included.
Many CFOs therefore consider not just direct utility savings but also risk mitigation ROI (avoided damage, downtime, compliance fines, etc.) which IoT provides by giving early warning of issues.
- ROI in Financial Terms: CFOs may translate savings into familiar metrics like increase in EBITDA or asset value. Energy savings drop straight to the bottom line.
For a property owner, reducing operating costs by $1 can increase asset value by $10–$20 (using cap rates of 5–10%). We saw an example where $69,700 in annual energy/water savings raised a multifamily property’s value by $610k–$1.16M (Impact of Energy and Water Savings on Multifamily Properties | WegoWise).
Similar logic applies to commercial buildings – an office building that saves $100k/yr in utilities could be worth $1–2 million more. Thus, IoT isn’t just cutting this year’s expenses, it’s building long-term enterprise value.
The ROI can be communicated in those terms for clarity – e.g., “This IoT upgrade has a 50% IRR and increases our building’s appraised value by $X million.”
- Real-world Benchmarks:
- Hotels: 15–20% energy savings, ROI ~50–100% (payback 1–2 years) ().
- Offices: 10–30% savings, ROI often 30–80% (payback ~1.5–3 years). Many see positive cash flow from year 1 due to financing or phased roll-outs.
- Retail: 10–20% savings, ROI ~20–60% (payback ~2–4 years, faster for larger stores). The variance depends on store size and hours – 24-hour big boxes save more absolute energy and thus have faster ROI.
- Industrial: ROI can be extremely high when preventing costly downtime – often justified on reliability alone, with energy savings as a bonus (difficult to generalize a number, but many have seen multi-hundred-percent ROI just from avoiding one big failure).
Conclusion
From the above analysis, it’s clear that IoT-driven efficiency is a financially savvy move for businesses in New York, Los Angeles, Chicago, Houston, San Francisco, and beyond. High utility rates in many of these cities magnify the value of saving each kilowatt-hour or gallon.
IoT implementations can often be justified purely on an actuarial cost-savings basis: by reducing waste (often ~15–30%), they slash recurring expenses and pay back rapidly.
Crucially, we identified that even mid-sized facilities (tens of thousands of square feet, or utility bills in the mid five-figures) reach the threshold where IoT is compelling.
No longer is IoT only for marquee skyscrapers or giant factories – it’s now an essential tool for cost control and sustainability in everyday businesses. Retail stores can curtail one of their largest operating costs, hotels can protect their thin margins from energy volatility, and offices can turn facility management into a source of savings.
Other industries like manufacturing, data centers, and healthcare are similarly ripe for IoT optimizations that bolster the bottom line.
For CFOs and financial decision-makers, the message is: investing in IoT solutions is not an experimental tech spree, but a prudent financial strategy. The data shows that these investments yield tangible returns – often boosting annual profits after a short payback period and continuing to generate savings year after year.
In many cases, IoT upgrades can be structured so that savings exceed costs from day one (via smart financing or phased implementation), making the decision even easier.
In sum, implementing IoT for utility management is a cost-saving measure with proven ROI, vital for business sustainability and competitiveness. Companies that embrace it will not only reduce expenses and improve their efficiency metrics; they’ll also enhance asset values and resilience against future utility cost increases.
As illustrated with the rates and examples for NYC, LA, Chicago, Houston, and SF, the numbers speak clearly: IoT is a smart investment that pays for itself – often quicker than expected – and continues paying dividends in operational savings.
Utility Cost Landscape in Major Cities
Utility rates vary widely by city and region. To compare costs, we’ve converted water and sewer rates to a common unit (CCF, or hundred cubic feet; 1 CCF ≈ 748 gallons). Electricity is given in cents per kilowatt-hour (¢/kWh) and natural gas in dollars per therm (1 therm ≈ 100 cubic feet of gas). Below are official utility rates in each city:
New York City (NYC)
Water: $4.49 per CCF; Sewer: $7.14 per CCF (159% of water rate) Combined, NYC businesses pay about $11.63 per CCF of water consumed.
Electricity: ~17.7¢/kWh on average for commercial customers (Electric Power Monthly - U.S. Energy Information Administration (EIA)).
Natural Gas: Approximately $1.00–$1.20 per therm (varies seasonally). New York’s water/sewer costs are relatively high (FY2025 rates rise to $4.87 + $7.74 = $12.61/CCF (Rates & Regulations - Water Board)), making water efficiency critical.
Los Angeles (LA)
Water: ~$9.39 per CCF (City of LA, commercial Tier-1 rate mid-2024). LADWP uses tiered pricing; heavy users pay up to ~$13.4/CCF in higher tiers.
Sewer: $5.80 per CCF (city wastewater charge). Together, LA businesses effectively face ~$15 per CCF for water/sewer.
Electricity: ~18.2¢/kWh for commercial accounts (California average).
Natural Gas: ~$1.00–$1.10 per therm (SoCal Gas rates, varying with market prices).
Chicago
Water: $35.10 per 1,000 cubic feet, i.e. $3.51 per CCF ( City of Chicago :: Water and Sewer Rates );
Sewer: charged at 100% of water usage (dollar-for-dollar). This equals $3.51 per CCF for sewer, or about $7.02 per CCF combined. Chicago’s water costs per volume are lower than coastal cities.
Electricity: ~11.5¢/kWh on average for commercial users in Illinois.
Natural Gas: ~$0.95–$1.00 per therm (Peoples Gas in Chicago has a 2024 cap at ~$0.97/therm).
Houston
Water: tiered by usage; in 2022 commercial rates were ~$5.55 per 1,000 gallons, rising to over $7.00 per 1,000 gallons by 2024 () (roughly $5.3 per CCF).
Sewer: similarly rising into the $9+ per 1,000 gal range by 2024 () ($6.9 per CCF). Combined, Houston’s water/sewer runs around $12–$13 per CCF for high-volume users.
Electricity: ~8.7¢/kWh average for Texas commercial customers (energy costs are low due to deregulated markets).
Natural Gas: ~$0.50–$0.60 per therm (Texas enjoys low gas prices). Houston’s relatively cheap electricity makes HVAC efficiency more about peak demand management than unit cost, while water is a growing expense.
San Francisco (SF)
Water: SFPUC charges uniform rates for businesses; wholesale cost to the city is ~$5.21/CCF, with retail rates higher after distribution costs (on the order of ~$7–$8+ per CCF for end-users).
Sewer: San Francisco’s combined sewer/stormwater system leads to high wastewater fees that depend on discharge volume and strength. For typical commercial waste strength, sewer rates per CCF can exceed water rates (often making total water + sewer > $15 per CCF).
Electricity: ~18¢/kWh for commercial users (California average) note SF’s electricity is delivered by PG&E or CleanPowerSF at similar averages.
Natural Gas: ~$1.10–$1.20 per therm (PG&E gas rates). San Francisco has some of the highest combined water-sewer costs, so water efficiency and leak detection IoT can yield particularly large savings.