Upgrading commercial and industrial facilities often requires a comprehensive approach that is similar to falling dominos. Each element of the upgrade reveals the effects or weaknesses in adjacent systems that should ideally be addressed at the same time. This “domino effect” kicks in when projects become daunting after the “lowest hanging fruit” or piecemeal approach is considered to be counterproductive.
Scott Ringlein, CEO of The Energy Alliance Group of Michigan (EAG), will be giving a presentation on why the domino effect hinders projects and how to overcome it’s project stalling dilemma at the High Performance Buildings and Workplaces event next month in Arlington, Texas. Ringlein will highlight the following case study of a project that almost fell victim to the domino effect.
When the domino effect kicks in it becomes easy for decision makers to delay upgrades and accept the loss of efficiency as a cost of doing business.
The owner of a 1920’s era building was interested in a long overdue boiler replacement and requested that Ringlein coordinate the project while also developing solutions to minimize the financial burden of the upgrade. Under consideration were rebates, utility incentives, tax strategies and energy-specific financing.
The domino effect began as Ringlein’s energy team evaluated the facility. It was decided that upgrading the boiler, without simultaneously replacing the windows, would be counter productive. The new boiler would lose any inherent efficiency due to the dramatic loss of conditioned air by way of the original 281 single pane windows which no longer sealed completely!
A recommendation that the boiler be upgraded at the same time the windows were replaced included a similar suggestion regarding the roof! The ancient roof, which was installed without insulation, was leaking in a variety of locations and needed to be upgraded with a thermal barrier along with new roofing material. The domino effect was now operating in full force and it’s at this point that most upgrade projects come to a grinding halt.
A New Approach – Comprehensive Financing Fosters Comprehensive Projects
While comprehensive upgrades undoubtedly save money in the long run, how to pay for them today is the real issue that hinders progress. A lack of project financing is often the key stumbling block that keeps many upgrade and efficiency projects from moving forward. A different approach is required if maximum results are going to be achieved!
Financing is the key component of a successful upgrade.
Because of the wide variety of financing options (including the option to self finance) it is important for any project manager to identify the stack of financing resources that best meets the project parameters. Those parameters may include return on investment, maintaining optimum cash flow, availability or lack of capital, impact on a potential future sale, etc.
In addition to traditional commercial loans, and some of the more common financing options such as capital and operating leases, there are a number of financing programs that are often unknown by product suppliers or project developers. One of the most innovative programs now available is known by the acronym PACE which stands for Property Assessed Clean Energy. Ringleins presentation at the High Performance Buildings and Workplaces will explain PACE in detail and how it minimizes the Domino Effect.
Why Minimizing the Domino Effect is Important!
Because close to half of all the commercial buildings in the U.S. are over 50 years old, it is important to address any factor that hinders upgrades to outdated building infrastructure. Here’s a brief clip of Ringlein describing what that looks like in the real world:
Building owners and managers stand to benefit financially when they upgrade the commercial and industrial infrastructure that typically wastes over 30% of energy consumed. Reducing waste is now possible through the use of technologies that consume less energy, are socially responsible and create a better indoor and outdoor environment.
It is now possible to combine energy efficient technology with on-site renewable energy to dramatically reduce the cumulative waste of energy present in our collective building infrastructure. The recent developments and initiatives that make this possible will be discussed and on display at the upcoming High-Performance Buildings + Workplace event in Arlington, Texas.
Scott Ringlein’s presentation will describe how, through the use of a variety of energy specific financial tools including PACE, the domino effect no longer needs to hinder the successful launch of upgrade projects. Commercial and industrial building and equipment upgrades are now more affordable than ever!
“At High Performance Buildings + Workplaces, facility managers will find indepth information on energy efficiency, smart building, and workplace design strategies that are transforming the way buildings are designed and managed. This session is a great example. It will tackle one of the thorniest problems that facility managers face: getting energy efficiency projects funded.” Ed Sullivan, Editor Building Operating Management magazine
See Also: Webcast: Eliminate Financial Hurdles with PACE Financing