The Time to Shop for Your Natural Gas is Now

It’s hard to believe, but the summer is slowly winding to a close. Even though days are still long and temperatures are high, now is when you want to start thinking about your natural gas contract.

Many businesses, non-profits, and residential consumers only consider their natural gas rate in few instances. It may be when winter arrives and the heat gets turned on or simply when your current contract expires. After all, for most, natural gas comprises a relatively small percentage of monthly expenses.

There is however a number of non-residential entities that pay a considerable amount for natural gas through the winter. This includes manufacturers, hospitals, schools, and even churches. In some cases, reducing rates by a matter of cents can add up to thousands in annual savings.

We have seen the adverse effect a cold winter can have on the budget. Just think back to the beginning of 2014 when the nation was overcome by the polar vortex. This of course was unexpected for most and hit many hard in the wallet.

Now though is the perfect time to negotiate your natural gas rate. Currently, gas reserves are up more than 5 percent over last year and prices have trended down these past 12-months. As we get closer to the winter season, the prices will go up. This is a function of supply and demand. Purchasing now enables you to capitalize on lower rates. If you signed a 12-month contract at a higher rate, renewing now will save you money during the following winter.

You have several options for exploring a natural gas contact. If you are a smaller consumer, there are programs through your utility and local brokers you can work with. Be sure to understand the terms of the contract offered and the fine print. Consult an energy advisor if you are unclear about any terms in the contract.

Additionally, most local chambers of commerce will offer their membership what is known as community aggregation programs. If you are not already part of your local chamber, you may want to consider exploring the many benefits they can offer.

If you are a larger consumer, spending perhaps $10,000 monthly on energy or more, there are additional options available to you. The market has become rather sophisticated with a number of products to select from. Though you may be experienced in managing your companies’ energy portfolio, it certainly would benefit you to explore options with your energy advisor to ensure you are making the most informed decision.

Why Energy Benchmarking Is For You

Energy benchmarking is an extremely valuable tool in today’s energy marketplace. However, many who manage energy portfolios today are not taking advantage of the resources available to benchmark their facility. Anecdotally, I have found, this is due in large part to the fact many do not know or understand what benchmarking is.

When you benchmark your facility, you are tracking the total electricity, natural gas, steam, water and other utility that your building consumes. In many circles, this is also known as your building performance. Once you have collected the requisite data, you can compare your building performance to facilities that are similar in size and operation to your own.

I recently took time to meet with a colleague, Justin Kale of Energility, to better understand the value proposition of energy benchmarking. Justin is a specialist in this field and shared the following thought.

“Benchmarking is similar to the use of a compass when navigating a path. It is a great way to establish where you’re at and monitor your position over time. This enables you to see how far you have come over a period of time with respect to building energy performance.”

Benchmarking provides the busy CEO, CFO or facility management team, baseline information to be able to compare the energy portfolio of their building to other buildings in their peer group. Once you identify areas for improvement, you can begin to craft an energy plan. Benchmarking gives those same professionals the opportunity to prioritize the deployment of capital resources or achieve recognition for past project implementation.

There are a number of great resources that are accessible in the marketplace to help facility managers to benchmark their performance. One of the more prominent tools is the Energy Star Portfolio Manager. It was created by the EPA to be an “online tool you can use to measure and track energy and water consumption, as well as greenhouse gas emissions”.

Benchmarking will enable facilities to make informed decisions on where investments should be made regarding their capital projects. Ultimately, knowing how your building operates and where weaknesses exist will allow you to reduce consumption, costs, and operational expenses. Furthermore, benchmarking is a process that many can do on their own by leveraging the tools in the marketplace. Whether through the EPA and its Energy Star programs or the Lawrence Berkley National Laboratory, the resources exist to manage this process on your own.

The final thought I will leave you with is benchmarking can aid you in staying ahead of impending energy mandates and legislation. Whether federal or local, the energy landscape is rapidly changing. It will prove far less costly to become energy efficient on your timetable rather than someone else’s.

As always, if you have questions or concerns about energy benchmarking, consult an energy adviser to help you make the best and most informed decision.

Can a Single Business Battle the Effects of Climate Change?

Is it possible for just one person or one business to battle the effects of climate change? Perhaps a more appropriate way to evaluate that question is to simply ask if you and your business could. It seems like an unrealistic expectation; the idea that a single company can impact a global crisis. Such a goal may not be as out of reach as you may think.

Earth

Let’s take a step back for a moment to appropriately set the stage. Recently, a peer reviewed article outlining the critical effects of climate change began receiving some notable attention from outlets such as CNN and USA Today. The research article painted a grim and distributing image of what Earth’s future may look like in the absence of necessary change in global human behavior.

Originally appearing in Science Advances, the premise of the article argues that Earth is possibly facing the 6th mass extinction event in the planets history. Since 1900, nearly 500 species have gone extinct. During that period, historical data indicates that number should have been just 9.

Arguably, the most alarming conclusion is that the loss of biodiversity would lead to a mass extinction event in as little as three generations. According to the CNN article, the data shows it is possible for humans to wipe out nearly 75% of species on Earth if drastic and needed changes aren’t made. That window to effect change is rapidly closing.

Scientists are not the only ones advocating for considerable change in human behavior. In June, the Pope published a manifesto regarding climate change. In his writings, the Pope argued the reckless behavior of humanity is adversely affecting our planet; a common good that we all must take care of.

Whether advocated by science or the Pope, the steps we all can take amount to the same. It boils down to reducing your carbon footprint. This simple concept is the impetus for energy efficiency, and the foundation for all that I do with my clients. Regardless of your motivations for energy efficient behavior, we each can do our part.

Let’s revisit our original premise. It is difficult still to imagine that a single person or company can effect change on a global scale. But what happens when millions of people and thousands of companies work in concert.

At the end of the day, it wasn’t simply one business, government, or entity that created this problem. It was countless participants, spanning decades, within countries around the globe. Each has played a singular role in what is quickly developing into a global catastrophe.  It stands to reason that we can reverse this trend in much the same way; one business and one person at a time, doing their part.

The one remaining question is what role you will play moving forward…

Energy Efficiency: Transaction vs. Consultative Approach

Tell me if this scenario sounds familiar. You’ve been tasked with managing the energy portfolio for a building. Your company may be a manufacturer, hospital, school or commercial real estate property. Regardless of your specific operation, the common thread is that you likely have a very small operating budget, minimal staff, and host of ongoing issues that land on your desk.

You want to be proactive; planning for future issues before they arise, but the resources you are given forces you to be reactive.

As I meet with clients in varying industries, I continually hear this same narrative. To add insult to injury, many of these managers express the challenge of juggling additional responsibilities outside their defined position. Obviously, this further strains their budget, time, and personnel.

Building Construction

This struggle sets the stage for two opposed energy management methods, transaction versus consultative.

A transaction sale can be categorized by solutions that are specific to equipment failure or end of life. You would see this for example with an old boiler or HVAC unit. After decades of operation, they simply stop working. This requires the consumer to engage in a point of sale transaction.

Usually, the replacement comes with a premium cost because of the urgency. In many cases, this could easily erase whatever capital budget you had planned to use for energy efficient upgrades.

Contrary to a reactive transaction is a more proactive consultative approach. We can simplify this with two specific examples.

In the first example, your energy advisor can help you address the unique pain points your facility must deal with. A common one I often come across are issues with facility lighting. It may surprise you to learn that with older lighting technology, you will experience over time lumen degradation. This is a fancy way to say your fixtures aren’t emitting as brightly today as they did when first installed.

(A simple solution for this is to install an LED fixture. Prices for LED solutions have come down dramatically and have become more economical. The life of an LED fixtures last substantively longer than outmoded CFL solutions.)

The second example is the purest form of energy consultation. In this instance, your energy advisor would work alongside you to draft a comprehensive energy management plan. This includes identifying all existing pain points, categorizing remaining equipment life, and producing an analysis on potential retrofit costs and payback periods. This latter portion should factor available incentives and rebates as well as creative or alternative financing mechanisms.

This enables you to prepare, well into the future, for all contingencies and eventualities. You can include capital improvement projects in annual budgets, factor in the energy savings, and ultimately avoid untimely failures that can dramatically disrupt production.

For many dealing with complex energy issues, transaction selling has become the norm. Emerging resources in the market can help you better plan, prepare and manage energy portfolios. Leveraging an advisor can enable you to develop a more structured approach and avoid the roller coaster that has been your energy management strategy to date.

Should Businesses Invest in Wind and Solar?

Recently, I had the opportunity to visit a friend in Colorado. It was a trip designed to give me some much needed R&R and a chance to hike, run, and just be out in nature; the latter of which I should probably do much more often. Despite being a recreational trip, the energy consultant in me couldn’t help but notice the prevalence of renewable technology… everywhere. It was common to see turbines and solar farms or houses whose rooftops were lined with solar panels. It was an interesting contrast compared to Ohio.

I had asked my friend, a celebrated thought leader in the sustainability industry, how solar, wind, and other renewables became so prevalent around Colorado. The answer was really quite simple. People wanted it. From consumers to legislators, it was a function of demand and political will. There is a burgeoning industry of installers and a fair amount of incentives pushing people in this direction. And it almost seemed like the utilities were going along with it without a fight.

Back home, I am often asked by clients, if installing solar panels or erecting turbines is a good investment to make. The answer of course depends on why they are doing it. If the intent is to be used as a marketing tool, or simply because the company feels it’s the right thing to do, then yes. But if someone in Ohio today is pursuing renewables as a cost savings measure, then no, it is not a recommendation that I would make.

So why would someone who promotes energy efficiency and sustainability not recommend renewables? Let’s look at Ohio’s recent renewable history to better understand.

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At the beginning of the decade, it appeared as though Ohio was making strides within the renewable sector. This included creating thousands of “Green jobs” along with massive increases in wind and solar production. Despite this, Ohio still ranked near the bottom in renewable electricity and generation capacity compared to the nation.

Over two-thirds of electricity in Ohio is derived from coal, and another twenty percent from natural gas. Only 1.5 percent was from renewable sources in 2010. To make matters worse, the renewable energy industry has shifted dramatically in just the last year. In 2014, the state legislature passed Ohio Senate Bill 310, imposing a two-year moratorium on Ohio’s renewable energy standards.

I am hugely in favor of developing renewable energy sources through improved technology and more cost effective production. The reality though is Ohio is not ready for that. Ohio is still a coal state and will continue to be for the foreseeable future. Also, it’s probably going to take a federal effort along with public-private partnerships for investment in renewables to garner the necessary results.

When working with clients, my job is simple. Improve their energy portfolio and identify cost savings with strategies that are effective and efficient. Unfortunately, renewable options today don’t fit into that paradigm. Until they do, I will continue to advocate for smart efficient solutions that meet the unique needs of the businesses I work with.

Identify Energy Solutions with an Energy Advisor

The energy industry today is more dynamic and complex than ever before. The advent of new technologies, shifting energy costs, and the constant barrage of federal and state legislation, has made it extremely difficult for consumers to stay adequately informed. For these reasons, EPCO is a huge proponent of the idea that every business should have an energy advisor.

The concept of an energy advisor hasn’t fully taken hold throughout the marketplace. Perhaps it is because most businesses don’t clearly understand what an energy advisor is, or, how they would use one. Think of it in these terms. A typical business will utilize a lawyer for legal needs or a CPA for accounting. There are many professionals and firms that can provide the same consultative services for managing your energy consumption.

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For smaller enterprises, you may leverage the expertise of an energy advisor to negotiate better rates for your gas and electric utility. But if you are a larger consumer, like most clients I work with, your energy management needs could be substantial. The right advisor can help identify and craft energy solutions for a myriad of concerns. This may include lighting audits and retrofits, power factor correction studies, or improvement to process cooling / heating performance.

You want to be sure to work with the right advisor, not all are created equal. Each client that EPCO collaborates with receives a unique and customized energy evaluation. No two businesses have the same needs or operate in the same way. Your energy consultant should provide you with a distinctive energy saving solutions that will allow you to make immediate and lasting cuts to your operating budgets.

Working in concert with you, and focusing on your specific needs, a reputable advisor will design a sensible compilation of measures that provide for turnkey energy efficiency solutions. Ultimately, you will want to take a long-term planning approach, leveraging short term savings opportunities that are invested into more capital intensive projects. This diversifies energy portfolios and ensures a cost effective and sustainable path into the future.

There are many more factors to include. You will want to leverage potential financing and rebates as well as develop a structured strategic plan to help guide you. The first step though is to find and work with the right team of professionals. The world of energy procurement and management is virtually the Wild West. Make sure you are coming armed with the right support.

 

Yes… Lighting is Your Low Hanging Fruit

Let’s say you’re the director of facilities for a local manufacturer or the business manager for a school district. By now, you’ve likely had a parade of salespeople knocking on your door to sell you a lighting retrofit. Each comes armed with a very similar pitch. Lighting technologies are the most advanced that they’ve ever been. ROIs are up and payback periods are down. And the most overused saying, lighting is your low hanging fruit.

In your job, you have to wade through all the gimmicky sales jargon and back of the envelope math to figure out what’s real and what’s a mirage. The difficulty is you wear many hats, and finding the time to learn the truth is challenging.

Having a clear understanding of your opportunity, along with a defined plan, will help streamline and simplify the process.

First, let’s be realistic. Just because a lighting retrofit reduces energy, doesn’t automatically mean it’s the highest and best use of your capital improvement dollars. As we have previously shared, you should start with a comprehensive facility audit. This will help to determine what projects, if any, you should focus on.

Assuming, lighting is a true cost-saving opportunity, you should understand what the current environment looks like. It is true that LED lighting efficiency is on the rise and costs have continued to decline.  This has made retrofitting your facility more economical than ever before.

However, lighting is no longer as simple as swapping out a light bulb. Advancements in lighting solutions have required the industry to move away from simple one-to-one replacements, opting instead for structured and thoughtful design. This is where it becomes imperative that you work with the right lighting firm that understands your specific needs.

Church Lighting

Many lighting firms still use antiquated methods for installing lighting. Worse yet, some firms attempt to sell you a solution you don’t need, simply to increase project costs. Ultimately, the lighting solution you choose should be unique and customized to your facility. It should incorporate the most efficient and effective design with products that maximize lumens and comfort for employees and guests of your facility.

Don’t be afraid to utilize a design-build process. Your energy advisor can work alongside you to create the right facility design and layout, and then solicit bids for the cost of the fixtures to ensure you receive a favorable market rate.

Opportunities for energy efficiency will continue to increase as technology improves. Surround yourself with a competent energy advisor that will ensure clear, transparent, and efficient energy solutions for you and your facility.

 

Three Ways to Pay for Energy Efficiency

Recently, I shared with you the importance of crafting an energy plan to help guide your mission of becoming more energy efficient. Having a plan is great way to identify the opportunities in your facility and how best to prioritize your implementation schedule. However, knowing what you should retrofit and subsequently how you will pay for it, are two very different objectives.

In today’s economic climate, finding discretionary dollars to pay for energy efficiency upgrades is challenging to say the least. Typically, for most businesses, only a fraction of total operating expenses are energy related. Each fiscal year, when evaluating capital expenditures, energy projects tend to rank pretty low.

EPCO understands the financial concerns and restrictions our clients face. Part of our value proposition is to cultivate and leverage any and all incentive opportunities that exist in the market. Below are three essential and easy steps, to be packaged with your project, that will help lessen installation costs, increase project ROI, reduce payback periods, and amplify net savings.

Utility Procurement

Most consumers are content to simply sign a multi-year contract and never think about their utility bill again. This can be a costly mistake, especially for larger consumers. Negotiating a lower rate by even a few cents can yield significant value. In addition, it is very likely that at some point, now or in the future, an error on your bill will occur.

Think about the number of residential, commercial and industrial customers served by your utility.  Statistically, a mistake is bound to happen. Be sure to work with your energy advisor to review your billing history for any anomalies or incorrect charges. When billing errors are found, the money owed to you by your local utility can be reinvested into your energy project.

Rebates, Tax Credits, & Grants

Many utilities and state funded agencies offer a host of incentives, rebates, credits and grants to specifically help fund energy efficiency. Some of these opportunities do carry restrictions based on your industry, geography, or annual consumption. Other programs are publically available to all. The important point here, is to work with a professional energy advisor that is well versed on the available programs and application processes.

Traditional and Non-Traditional Financing

This is the most critical part of the implementation process. No longer are businesses relegated to merely two financing options; using one’s own capital or traditional lending institutions. Popping up around the country are these novel and creative alternative financing mechanisms. They leverage the net savings of your project and structure the loan terms as a service agreement. This allows you to fund the project with little to no money out of pocket and treat the payments as you would an operational expense.

In the end, the reduction you enjoy in operating expenses means more dollars toward increased productivity, better employee wages, and more revenue. The opportunities are certainly out there. Talk with your energy advisor today about how you can become more energy independent.

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Four Steps to Reducing Inefficiency in Your Building

Is your facility as energy efficient as it could be? How does your energy rates compare to current market conditions? Do you have equipment and systems needlessly using energy when off-cycle? These are more difficult questions to answer than most would think. Many clients I work with are wearing multiple hats each day. I am confident you are too. It’s extremely challenging for them to keep up on prevailing technologies or fluctuating rates while trying to juggle production schedules and personnel.

An essential tenant of the EPCO philosophy to energy management is having a comprehensive plan to guide you. Your energy plan should be a holistic approach to the energy consumption of your facility.  Utilizing a long-term lens, EPCO designs a plan that factors each component comprising your specific energy fingerprint. This includes how you use energy, when it’s consumed, and most importantly, where you can save without disruption to your operation. As great as this may sound, the next logical question is, how do I create this plan?

EPCO has simplified the process into an easily digestible four-step approach.

  1. Identify your pain points – Work alongside your energy advisor to understand, from your perspective, the energy-related issues you are facing. This could be as a simple as utility billing errors or ineffective lighting to more complex issues such as process cooling / heating and heat reclamation.
  2. Perform an ASHARAE Level Audit – A facility Audit is a great step towards realizing your simple payback. Whether it is an LED upgrade, automated controls, or mechanical equipment retrofit, an audit provides the facilities baseline data needed to understand your opportunities.
  3. Prioritize the Data – Following the audit, review the data to determine where the most substantial and relative savings exist. Cross reference the pain points you first identified with each proposed solution. Calculate what the capital costs are in relation to energy savings. And be sure to leverage incentive and financing opportunities.
  4. Draft and Execute Your Plan – Once you have determined the value and importance of each solution, your energy advisor can work with you to implement each identified energy savings opportunity. Start with the highest prospective paybacks so you can reinvest those savings into more energy intensive projects.

A carefully crafted energy plan will empower you with the ability to more seamlessly manage your energy portfolio. Whether you move forward immediately with each measure, or wait for a more opportune time, you will be better informed and prepared.

What EPCO Can Do For You

As we approach summer, more and more businesses will begin to think about their energy consumption. In a just a couple of months, higher temperatures will bring increased electric consumption. Consumers will be cranking up their cooling load or increasing production. With increased consumption come increased energy costs. That is the bad news. The good news is that there are steps you can take to mitigate those rising operations expenses.

Energy Planners Company (EPCO) is a full service energy solutions firm committed to providing the best products and services available to our clients and partners. Leveraging our proprietary approach to energy management, EPCO will work alongside our clients to create a long-lasting advanced strategic plan to address all their current and future energy related needs. EPCO’s carefully designed methods and portfolio will help your business realize savings in areas you may not have known existed.

Electric & Natural Gas Utility Bill Review

For each metered account, EPCO will review all supply side charges related to the acquisition of, and costs associated with, electric and gas procurement.

ASHRAE Levels 1, 2, & 3 Assessments & Design

ASHRAE level energy audit & lighting assessments determine where, when, why and how energy is used in a facility. The main outcome of our customized energy audits is a list of recommended energy efficiency measures (EEMs), associated energy savings projections, and a calculation of whether EEM installation costs are a good financial investment for your facility.

Rebates, Incentives & Financing

EPCO specializes in creative and alternative financing mechanisms. Our team of professionals will leverage the energy efficiency projects you perform to exempt your facility from costly utility fees or apply for rebates through either your local or regional utility.

Long-term Energy Planning & Strategy

EPCO takes a holistic look at an entire building or campus to choose the appropriate approach to create cascading savings and improve asset value. EPCO will help design a clear and customized business case for a deep energy retrofit through quantifiable savings and empirical research.

Project Management & Implementation

From project identification, to design, and ultimately installation; EPCO can manage and facilitate the entire retrofit process for your facility. EPCO works with all energy intensive industries and consumers and understands the complexities of retrofitting a facility such as yours. Areas of project management expertise for EPCO include, but are not limited to, the following.

  • Lighting
  • HVAC
  • Motors, Drives, & Controls
  • Roof Top Units (RTUs)
  • Air Handling Units (AHUs)
  • Combined Heat & Power (CHP)

EPCO prides itself in its ability to cultivate unique and customized solutions for each client it works with.

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