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Who’s Scared of an Audit?
What you should know about your next energy audit.
Western Allied Mechanical
many times has the word “audit” been used in the wrong connotation?
Everyone hears the stories of having their taxes audited and the
nightmare of working with the IRS. So naturally, when mentioning the
“word” to facilities management, the first reaction is horror and
disgust followed by, “We’d rather just not pursue that route right
now.” So what are you actually losing by neglecting your energy usage?
Is it best to wait
until your manager or a new tenant forces you to expose your energy
bill? How much time does a facility owner or manager have to dedicate
to an audit to substantially reduce energy?
first step to
subverting fear about an energy audit is to understand the process and
terminology – which can be initiated by discarding the term
“audit” in place of “Energy Analysis.” Typically, the actual Audit portion of the project is at
the end to quantify measures found in an Assessment of your building. The
three components of an Energy Analysis include:
have traditionally received mixed reviews among stakeholders in the
facilities industry. Figure: 1 illustrates common facts and myths that
are often associated with energy analyses with facilities staff. The
most common myths are centered on the cost and complexity of an
analysis that has the ability to produce a ROI (Return on Investment)
less than five years. The process of an Energy Analysis (Benchmark, Assessment, and Audit)
allows an owner or tenant to pursue savings based upon their budget and
their level of engagement. For example, a facility with a relatively
low Energy Star Building Index (> 50) can typically save up to 20%
without actually quantifying the saving measures in the Audit
portion of the analysis. A significantly low score could suggest failed
equipment or poor method of control – Both of which lead to higher
savings after a full Assessment.
myths include false expected savings, or no savings at all, generated
by an analysis that may cost thousands of dollars and hundreds of staff
hours to produce. Therefore, isn’t it easier to skip the analysis if
you sign a service contract that guarantees your equipment is working
correctly? Aren’t most of the saving measures generated centered on
broken equipment? Mechanical maintenance serves to protect capital
investments and tenant comfort by keeping equipment functioning
properly. In the energy analysis process, the Assessment will identify
failed components, but more interestingly, suggest a new methodology
for controlling existing equipment; Methodology typically requiring
little upfront cost.
Now that the fear of the
term “audit” has subsided, what level of financial involvement does the
customer have when compiling a report? As identified above, the
analysis itself as well as the measures it produces, can all be scaled
based upon budget. Cost to generate a report is inherently a measure of
facility size and usage requirements by the tenant. A facility that
runs 24/7 is more likely going to have a higher level of involvement
from the energy contractor and the maintenance staff to reduce energy.
These facilities tend to be more critical in nature, with suggested
energy measures typically requiring the upgrade of equipment and
scheduled shutdowns. On the contrary, general usage spaces such as
offices require less staff involvement for the analysis and little
tenant disruption for most energy saving actions.
consumption within buildings is characteristically undervalued as a
profit driver and funneled into expected annual costs. Negligently
signing an energy bill is typically easier than trying to actively
understand and reduce consumption. So how does energy stack up against
other assumed costs in an occupied building? We can observe Figure: 2
to see where your consumption fits into the rest of your budget –
which is larger than expected.
Take the below
example into account when trying to quantify gains from energy saving
measures found in an Analysis:
this example is relatively vague, it shows that a mere savings of 18%
in a building this size equates to a much larger savings – this
disregarding upfront capital savings from a provider. Many energy
upgrades typically placed into capital avoidance budgets can surface in
an Assessment and be
quantified in an Audit with
The term “audit” has gained popularity in the energy industry due to its effectiveness at evaluating and quantifying consumption. Facility owners and managers are pursuing savings as tenants are demanding Energy Star and LEED ratings of a building before signing a lease. Partnering with a contractor to complete an energy analysis good practice and helps to alleviate concerns and provide reasonable expectations on savings.
About the Author
I currently maintain an engineering sales position at Western Allied Mechanical. Our business is consulting customers on energy consumption and reducing costs through a joint mechanical and automation venture. I’m an avid follower of the industry and am always open to new opportunities and approaches. You can reach me at email@example.com or my cell at 650-798-4154.
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