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Using Energy Services to Drive Maintenance and Retrofit Sales

Using Energy Services to Drive Maintenance and Retrofit Sales. Series Schedule – Using Energy Services To… . Session 1 – April 14 th Ensure Maintenance Agreement Renewals Session 2 – April 21 st Win New Maintenance Agreements Session 3 – May 4 th Drive Retrofit Project Revenue.

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Using Energy Services to Drive Maintenance and Retrofit Sales

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  1. Using Energy Services to Drive Maintenance and Retrofit Sales

  2. Series Schedule – Using Energy Services To… • Session 1 – April 14th Ensure Maintenance Agreement Renewals • Session 2 – April 21st Win New Maintenance Agreements • Session 3 – May 4th Drive Retrofit Project Revenue

  3. It’s No Accident…

  4. Service Business Key Performance Indicators You Can’t Manage What You Can’t Measure

  5. The Financial Leverage of Service PM Agreements $1 Each $1 of service agreements generates the equivalent of $15.91 in new revenue

  6. “Cancellation Proof” Your PM Agreements • Probe for financial pain • Make energy is relevant (gain permission) • Demonstrate potential savings (benchmark) • Identify specific “low/no cost” measures that will immediately reduce costs and improve cash flow • Implement and verify

  7. Debunking the 2 Myths That Prevent Energy Services Programs from Moving Forward • “Energy costs can’t be controlled” • “Reducing energy spend will take a lot of capital”

  8. Energy Service Agreement™ Sales Process ~ 3% of cold calls result in a meeting ~ 1 in 6 1st meetings result in a PM agreement Sell Energy Services Get the Meeting 1st Meeting - Introduction Building Survey / Energy Benchmark Confirmation / Verification Present the Proposal Not an Opportunity Today Close the Service Sale

  9. Case Study • 138,000 sf • Built-up system • Chiller • Boiler • Pneumatic, constant volume control system

  10. Energy Benchmark

  11. Fix control issues Eliminate weekend operation Low-Cost Energy Savings Identified Temperature

  12. Fix economizer / ventilation control Low-Cost Energy Savings Identified Carbon Dioxide

  13. Low Cost Energy Savings Identified • Increase cooling / decrease heating setpoints • Optimize temperature control and lighting scheduling • Fix economizer / improve ventilation control • Boiler lockout above 60 F Over $70,000 of energy waste eliminated for $6,000 investment

  14. Retrofits are the Pot of Gold

  15. Agenda – Session 3 • Current economic climate for retrofit projects • Retrofit project sales process • Psychology of the sale • Proving value with monitoring and verification • Using utility rebates to your advantage

  16. Current Economic Climate

  17. Retrofit Project Sales Process 1st Meeting Building Survey Energy Analysis Present Proposal Close the Project Sale Not an Opportunity Today Implement Retrofit Performance Verification

  18. Sources of Leads Existing Service Base Bid Spec / RFPs

  19. Retrofit Project Sales Process 1st Meeting Building Survey Energy Analysis Present Proposal Close the Project Sale Not an Opportunity Today Implement Retrofit Performance Verification

  20. Building Survey / Energy Analysis • Define a process that is: • Repeatable • Scalable • Credible

  21. Trade Offs Simplicity | Complexity Automation | Manual Labor

  22. Guideline Document • ASHRAE RP-669 / SP-56

  23. Types of Energy Audits – ASHRAE Definitions • Preliminary Energy Use Analysis • Level I – Walk-Through Analysis • Level II – Energy Survey and Analysis • Level III – Detailed Analysis

  24. Preliminary Energy Use Analysis • Analyze historic utility use and cost • Develop an EUI • Compare to similar buildings Energy Benchmark

  25. What’s the Difference?

  26. Data Collection Building Automation System Trend Logs Data Loggers Custom Data Acquisition Systems

  27. Typical Analysis Methods Spreadsheets Hand Calculations Computer Models

  28. Retrofit Project Sales Process 1st Meeting Building Survey Energy Analysis Present Proposal Close the Project Sale Not an Opportunity Today Implement Retrofit Performance Verification

  29. The Energy Project Proposal

  30. by the hour by the pound for complexity You Do Not Get Paid…

  31. You Get Paid For… • Providing information useful in decision making • Moving projects forward

  32. Focus on the Financial Decision Maker

  33. The Psychology of the Sale Is Energy Savings a Motivator? “By maintaining proper tire pressure, keeping your engine in tune, and replacing dirty air filters you can improve gas mileage by up to 15%.” U.S. Department of Energy This savings is equivalent to 1 free tank of gas every other month

  34. The Psychology of the Sale What if someone stole a full tank of gas out of your car…every other month Would you be more likely to take action?

  35. The Psychology of the Sale “If you move forward with this project you will save $X per year” vs. “If you do nothing you will continue to waste $X per year” Psychologically, most people will do more to avoid a penalty than to earn a reward

  36. The Cost of Doing Nothing

  37. The Psychology of the Sale

  38. Retrofit Project Sales Process 1st Meeting Building Survey Energy Analysis Present Proposal Close the Project Sale Not an Opportunity Today Implement Retrofit Performance Verification

  39. ? ? ? • Ongoing monitoring and verification • Measure impact of ECMs Performance Verification Baseline Period ECM Event Performance Period Reduce the risk of saying “Yes”

  40. Two Perspectives Contractor Building Owner • “Did I get what I paid for?” • “Did I get credit for what I provided?” • “Did my customer perceive value?”

  41. Comparisons Challenges • Variables that impact baselines • Weather • Occupancy • Utility Rates

  42. Methods for Performance Verification • Periodic Energy Benchmark • Continuous Energy Monitoring System

  43. Closing the Loop “Adding the continuous energy monitoring and verification application to the BuildingAdvice™ program will really help us close the loop for our customers. Now when we’re proposing a sizeable energy retrofit project we can include a system that will accurately measure and report the actual energy savings delivered. This eliminates a tremendous amount of financial risk for the building owner. We think this will help justify moving forward with more projects.” Rick Cooke Vice President Airco Commercial Services

  44. Using Utility Rebates to Your Advantage • Two types of rebates • Prescriptive • Custom

  45. Prescriptive Rebates

  46. Prescriptive Rebates – Xcel Energy Efficiency upgrade: ($75 + $5 x (12.0 – 10.2) / 0.1) = $165 / ton $165 / ton x 20 tons / unit x 10 units = $33,000 Economizers: $20 / ton x 20 tons / unit x 10 units = $4,000 Total rebate = $37,000 • Example: • Replacement of ten 20-ton RTUs • Proposing high efficiency (12 EER) w/ economizers

  47. Custom Rebates • Requires pre-approval and submittal of engineering analysis • Xcel Energy provides rebates of up to: • $400 / kW (electricity) • $5 / mcf (gas)

  48. Energy Analysis Rebates • Rebate for a portion of the cost of an energy study or audit • AirAdvice can help you work with your utility to understand and approve your energy analysis process

  49. Biggest Challenge in Working With Utilities • Don’t get slowed down

  50. Case Study • 138,000 sf • Built-up system • Chiller • Boiler • Pneumatic, constant volume control system

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