Contractor Magazine recently published an article titled, “What Bad Looks Like” in which it described the state of the mechanical contracting industry. It lists the largest contracting firms and provides breakdowns by markets served, type of work, and geography. Not surprisingly, the bottom line is that the bottom line isn’t so good these days.
A “tough year.” Yes, it’s been a bit tough. And the only markets predicted to improve in the near term are healthcare, educational, public safety and transportation.
Fine, yes, the contracting business is a difficult one these days. I think we all knew that. But, what did we at AirAdvice take from this article? I zeroed-in on two quotes from industry leaders:
“As I’ve talked to our MCAA affiliates, I’ve said [energy savings retrofits] is the industry that we should own. While we are going through this slow period, now is the time to renew ourselves and focus on green and sustainable initiatives. MCAA President Bob Armistead is taking the same charge and pushing it forward.” - Lonnie Coleman, president of Coleman-Spohn Corp., Cleveland, and past president of the Mechanical Contractors Association of America.
“We’ll focus our energy on where the work is. We’ll get in front of customers with good energy-saving ideas on how to take cost out of their businesses.” – Tony Guzzi, President and COO of EMCOR Group.
Could be just me, but I think they’re saying that energy savings is where it’s at for contractors right now. So, there’s the bright spot and it is bright indeed. The vast majority of buildings that are going to be here in 20-25 years are here now. Retrofitting those buildings to new standards of energy efficiency, and driving down their operating costs, is THE opportunity for contractors. Lonnie Coleman is right – contractors should own this business.
Image courtesy of Blue Ridge Blue Collar Girl blog
New York is definitely where its at these days, what with those mandatory benchmarking laws swinging into effect and the Empire State Building’s and sustainable upgrades showing folks how it’s done.
“…the retrofit will deliver improved windows, high-efficiency light bulbs, and among many other things, renovated heating and cooling systems at a cost of $13 million after netting out other savings. By 2013, this plan will have reduced the Empire State Building’s energy usage by 40%. The $4.4 million in annual energy savings will have completely paid for the costs of the retrofit project 3 years after completion.”
The story behind the retrofits is told at the Empire State Building sustainability exhibit, where a glowing cube and other interactive elements beckon visitors to look underneath the landmark at the energy saving innovations beneath.
Right now, the Empire State Building consumes the energy equivalent of 40,000 single-family homes.
Rep. Maloney writes about how she convened a hearing to learn more about the Empire State Building’s energy efficiency progress. She emerged learning a few things, one of them being,
“…government has a role to play in shining a spotlight on the economic, environmental and consumer benefits of retrofits, but it is the private and non-profit sectors that will roll up their sleeves, nail down the economics and make these retrofits happen.”
Across the Empire State, buildings are smartening up, with no little thanks to OptimumEnergy. The Sun-Herald.com picked up this press release from OptimumEnergy, maker of software to increase energy efficiency through HVAC, which trumpets the company’s latest New York state deals (including the 1271 Avenue of the Americas building in New York City; a GE Healthcare manufacturing facility in Troy; and Westfield Group’s Sunrise shopping center in Massapequa). OptimumEnergy estimates its reduction software to save 9.9M kWh annually across the building portfolio.
In honor of that The Building Advisor offers you this break from our regularly scheduled programming.
In other news this week, EarthTechling decided to accentuate the negative in its coverage of the recent report from Pike Research, “Commercial Green Retrofit Interest Low.” Yes, they do point out the $41.1 billion potential savings from retrofits for new construction over the next 10 years. On the downside, nobody cares, apparently.
Buildings use about $200 billion worth of electricity and natural gas each year. What if we could cut just 10% of commercial buildings’ energy consumption? Very reasonable, wouldn’t you agree? That would be $20 billion in savings!
That’s what’s at stake in the new ENERGY STAR Challenge: Building owners, managers, and service providers working to achieve just a 10% drop in energy use.
Here is what we’re encouraged to do:
Measure and track energy use. (Energy benchmarking…the easy way to get started. We can help you.)
Develop a plan for energy improvements.
Make energy efficiency upgrades.
Help spread the energy efficiency word to others.
A toolkit is available at ENERGY STAR’s website, which provides all sorts of collateral and resources, including sample text for communications, a presentation, certificates, web banners, posters, and more.
What’s great about this goal is its attainability. 10% is nothing. Seriously. Through low & no cost measures alone, you should be able to save MORE than 10%. So, join the challenge. If you are a contractor, this is a great way to elevate your position with clients and prospects – tell them that you can knock off at least 10% of their energy bill and get them recognized through ENERGY STAR in the process.
Summer must be here because it’s even hot in Oregon. All over the country, HVAC technicians are working their fannies off to keep tenants cool.
And news of worldwide efforts to increase energy efficiency in commercial buildings keeps rolling like sweat down an AC technician’s temple. Such as Australia’s Labor Party announcing that it will offer a 50% tax deduction bonus for “green building work” from July 1, 2011 completed for buildings of two stars or less to bring them up to four stars or higher. This from The Fifth Estate, which called the energy efficiency sector “his consistently touted as offering the cheapest and fastest route to greenhouse gas reduction” and quoting the Labor Party’s web site estimate that the incentive will offer a $1 billion boost over the life of the scheme.
Last week Pike Research issued a report estimating that a full $41.1 billion could be saved in energy expenses every year by instituting a 10-year retrofit program, Environmental Leader reported and BEPN picked up. Pike’s report states that more than 80% of commercial buildings in the US are over 10 years old, and a 10-year retrofit program would cost only $22.5 billion. That’s almost a 50% profit margin – not a bad bet.
Last week, ASHRAE President Lynn G. Bellenger testified on optimizing federal building efficiency before the U.S. House Subcommittee on Government Management, Organization and Procurement to help them examine the federal government’s role in greening buildings.
And The Building Advisor’s poster child of the week award for asset stewardship goes to Brandywine Realty Trust, a REIT that owns, develops, and manages commercial buildings. It earned two U.S. Environmental Protection Agency (EPA) Energy Star labels for its 5 Greentree Centre, Marlton, New Jersey project and its Concord Airport Plaza – a project in Concord, California. Although both buildings had previously earned Energy Star ratings, they were re-commissioned and re-certified again for 2010, according to a press release.
Check out this article in GreenerBuildings on the amount of waste in commercial buildings. Its somewhat baroque yet applicable metaphor likens building operation waste through car-terms, like “commuting solo every day to work in an RV purchased for that once-a-year camping trip.”
The Building Advisor’s favorite part?
“…ICF International estimated that if every commercial building owner in the U.S. did an energy audit of their buildings, it would take 1,000 auditors more than 13 years, working 365 days per year, to deliver recommendations on upgrades for 5 million buildings.”
Hey speaking of, if you missed yesterday’s free webinar, “Energize Your Service and Retrofit Sales,” you can get recordings and slides from the webinar here. And it’s only the first of a three part series – you can still get in on our July 29 and August 5 sessions 10am ET / 1pm PT.
The Building Advisor is not the only one to have noticed that Americans seem to be slow on the uptake when it comes to energy efficiency. Wired Magazine’s Epicenter blog picked up greentechmedia’s (see our ‘green with envy’ post) “5 Reasons Why Green Tech Has Such a Tough Time in America” post this week, and there is some serious food for thought that goes beyond that now old standby explanation of unsexiness.
The post details how long we’ve had some of the technologies now considered “cutting edge,” such as the first wind turbine in 1888, the first photovoltaic cell in 1954, and even the invention of the first compact fluorescent lightbulb in 1976 – which wasn’t mass produced by GE at the time because it would have cost them $25 million to build the manufacturing facilities. Instead, the design was leaked and others copied it before GE had a licensing program.
Oooh. Good question. But then he answers it five ways, so you don’t have to think that hard. And the answers go as deeply into our national need for excess as they do into mainstream mistrust of The Climate Crowd. As a sign of the times, Kanellos links to a story about the first Earth Day in 1970 and what its initiator, George Fallon, had to do with starting the EPA. It’s a bit serpentine, but a reminder that mainstream and political support – not just the “dirty, smelly, strident hippies,” as Kanellos calls them – can create real change.
Thursday, July 22, 2010 1:00pm Eastern (10:00am Pacific)
Understanding your service business metrics. What are energy services and how do they fit into a planned maintenance program? What to do in advance of your service renewal date. Meeting with your client prior to next service date anniversary. Qualifying your customers’ interest with automated ENERGY STAR™ benchmarking. Adding energy services to existing service agreements.
Thursday, July 29, 2010 1:00pm Eastern (10:00am Pacific)
Sales management: getting your team ready. Targeting prospects who you can help with your energy services. Getting a meeting with the right person. Successful prospect meetings. Qualifying prospects up-front with energy benchmarking. Selling an energy assessment. Writing winning proposals.
Thursday, August 5, 2010 1:00pm Eastern (10:00am Pacific)
Targeting the right accounts and the discovery meeting. How to ensure retrofits continue to drive savings. Monitoring and verification. Selling an energy audit, closing retrofits using the audit report and partnering with your local utility.
If you’re considering adding energy management to your company’s service offerings or are looking to improve an existing energy service offering, start with this educational series on starting an energy management conversation and building valuable client relationships through a focus on energy cost savings. Register for free here.
Seattle Mayor Mike McGinn said yes to the Energy Disclosure Ordinance in February. Now what?
Back in January, Seattle mayor Mike McGinn passed the Seattle Energy Disclosure Ordinance requiring non-residential buildings over 50,000 square feet to benchmark and report on their energy performance by April 1, 2011; non-residential buildings 10,000 square feet or larger and multi-family buildings with five or more units must comply by April 1, 2012. We blogged about the ordinance in February here.
Right about now, property managers and building owners should be hustling to their utilities, because the ordinance requires building energy consumption data for the year prior. Is this happening?
Like our profile of Rob Ragozine of Donnelly Mechanical and the “street effect” of New York City’s similar legislation, The Building Advisor is wondering what actions Seattle’s commercial building owners and property managers are taking as a result.
The first meeting of the Green Building Task Force.
The City of Seattle has offered free workshops in benchmarking, and its website says that “the [ordinance] requirements will be preceded by a 1-year training and technical assistance program organized in conjunction with the US Environmental Protection Agency and local trade organizations.” So, is it underway? There is nothing up on Seattle’s Green Building Task Force page, and they’re the ones who suggested the ordinance in the first place – one year before it was adopted on February 1 of this year.
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“Up to 80 percent of commercial building energy is going up in smoke,” said F. Noel Perry, founder of Next 10, an independent organization that supports research, education and action to improve California.
“Indeed, an average building’s energy use can be cut by half just with low-cost, low-tech improvements to lighting and insulation.”
Next10‘s study points out that behavioral changes, or tenant use (adjusting lighting schedule, etc.) in commercial buildings can provide energy savings at very low costs. It is nice to see BuildingAdvice’s tried and true “low- and no-cost savings adjustments” line is truly a viable claim.
It’s real, folks: there are cash saving things you can do for your building that don’t cost anything.
Unlock that savings.
GreenerBuildings pulls out the point that while there is an emphasis on energy efficiency in new construction, it is actually existing building stock that represents the biggest potential for energy reduction, yet remains largely unaddressed by state legislation.
The GreenBiz blogwrites, “California’s commitment to reducing electricity consumption of state-operated buildings by 20 percent by 2015 covers new and existing structures. Certain voluntary measures in the state’s Green Building Standards Code, known as CALGreen, are scheduled to become mandatory in January 2011 for new commercial and residential construction. But there is no equivalent that applies to existing buildings.”
Australia prepares for its Commercial Building Disclosure scheme, dictating that owners and lessors of commercial office space of 2,000 m2 or more must disclose the energy efficiency rating to prespective buyers and tenants when the space is sold, leased or subleased (similar to California’s laws passed January 1, 2010).
The aptly named Health Care REIT has got on the EPA’s Energy Star Challenge bandwagon, planing to improve its overall energy efficiency by 10% or more through energy benchmarking, following a resulting plan consistent with Energy Star guidelines, and spreading the gospel.
Blog underdog GreenExitSigns.com came out of nowhere with a very concise post on how supersized chillers / fans and inefficient oil, electric and gas boilers “lead to a building incurring thousands of unnecessary dollars in annual utility costs.”
Thousands of unnecessary dollars, the man says.
Ok, the answer to “What do these three articles have in common?” is: not a lot, in some ways, which is kind of the point.
Energy efficiency should be topping your radar BECAUSE the forces behind it are coming from such disparate places. These articles represent reasons to increase energy efficiency for reasons of legality, corporate leadership, and cost savings.
Could be just me, but I think they’re saying that energy savings is where it’s at for contractors right now. So, there’s the bright spot and it is bright indeed. The vast majority of buildings that are going to be here in 20-25 years are here now. Retrofitting those buildings to new standards of energy efficiency, and driving down their operating costs, is THE opportunity for contractors. Lonnie Coleman is right – contractors should own this business.
New York is definitely where its at these days, what with those mandatory benchmarking laws swinging into effect and the 
The story behind the retrofits is told at the 
Summer must be here because it’s even hot in Oregon. All over the country, HVAC technicians are working their fannies off to keep tenants cool.
The Building Advisor is not the only one to have noticed that Americans seem to be slow on the uptake when it comes to energy efficiency. 
