Big energy upgrades without a big investment

by Sheri Smallwood    Energy efficiency involves more than just replacing your old units and systems; it requires planning and research. Simply adding the latest equipment because it uses less power is not the only relevant factor. Energy upgrades must fit the needs of a facility. What works in one building doesn’t necessarily equal efficiency in another.

Planning upgrades requires studying upgrade opportunities, setting objectives, and evaluating a plan to carry through. First, know your energy cost and usage. Energy-demand levels need to be tabulated into daily, weekly, monthly, and seasonal totals. A two- to three-year period is recommended for accuracy. This longer time frame lessens the influence of any one-time situations. Once you have an understanding of your energy patterns, conduct an energy assessment of your entire facility. The energy patterns and your examination will lead you to the strongest energy-savings options. By evaluating this information, you should see several upgrade possibilities and be able to estimate their savings potential. Since different upgrades will have various cost and time factors, how in-depth you are willing to upgrade is up to you.

Many executives looking to quickly implement a wide range of retrofits are turning to energy service companies (ESCOs). ESCOs carry out energy-upgrade projects without you having to pay up front or be liable for the risks of the venture. ESCOs undertake the projects every step of the way, from design and installation to financing. The energy efficiency and maintenance costs for facilities are guaranteed over a seven- to 10-year time period. What makes ESCOs more attractive than contracting firms in some facility mangers’ opinions is "performance-based contracting." A company’s dividends and the project itself are linked to the energy that is actually saved.

The ESCO employs a wide array of cost-effective measures to achieve energy savings. These measures often include: high-efficiency lighting, high-efficiency heating and air conditioning, efficient motors and variable speed drives, and centralized energy-management systems.

When entering into a contract with an ESCO, it is important that the project be clearly defined, along with the objectives. You should carefully screen the energy service company and approve any equipment being used. One crucial factor is determining how the savings will be measured. Energy saved and the compensation rates must be decided early on.

ESCO contracts vary and can be complicated, especially if anything changes in your facility. Enter into a contract with your eyes wide open. For best results, bring the ESCO on as early as possible to attain your desired goals. You can find more information on ESCOs from the National Association of Energy Service Companies (www.naesco.org).

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