February 2009

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State of the Industry - 2009
If you really want to help move our industry toward a future that works, I invite you to join with those who want a more sustainable future.

  Thomas Hartman, P.E.
The Hartman Company

Contributing Editor

What a start! The US now has a president committed to a sustainable energy future, but meanwhile the financial markets are now tumbling down the basement stairs. With all this, I thought it wise to seek advice for what to expect this year at the ASHRAE/AHRI meeting and expo. I took the opportunity to discuss the upcoming year with manufacturers, contractors and engineers while I was there. All are nervous, manufacturers most of all. Projects are starting to be cancelled and new inquires drying up. It’s widely agreed that there are two drivers that could bring this industry back. First, the stimulus might get the economy back to the point that building related projects return. That possibility remains at best a question mark for those I talked to.

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The second possible driver is new energy policy. Here, the early developments are less than encouraging. There may already be a law for this but if not, I’m going to call it Hartman’s law that the more money involved in any transaction, the less likely it is that the participants will do the right thing. That’s a theory I developed over the years from my experiences in this industry and its proof is being delivered daily in reports from the financial bailout. Much of the emerging new energy policy seems to ignore this law by proposing to throw large sums of money out and hope the recipients do the right thing. An example comes from what we are learning about “smart grid” proposals. A smart grid is a great idea. However, what makes an electric grid smart is not more poles and wires as proposed by the potential program recipients but by focusing on the loads served by the grid and making them smarter by adding connectivity and efficiency. To the contrary, adding new power lines simply encourages utilities to do the wrong thing by selling more power to be used with the same waste and inefficiency. “Smart Grid” proposals now taking shape look primarily focused on putting money in the pockets of large utility/contracting entities that hope to gain support with this disingenuous name.

Then there is the focus on the energy service company (ESCO) model for delivering improvements in buildings. To hear them talk, they’re doing a “heck of a job Brownie.” But those of us with real experience in such approaches know that these are at best 50% solutions which too often result in systems that are difficult to support and maintain and rarely succeed over the longer term.

On the bright side, a new congressional initiative called the High Performance Building Congressional Caucus Coalition ( http://www.hpbccc.org/ ) certainly appears to have genuine interest in the load side of the building energy equation. Some Congressional members of this coalition are beginning to make some waves toward encouraging investments on load side efficiency initiatives with accountability to ensure participants really do the right thing. One of those I discussed energy with in Chicago had a recent conversation with the office of Representative Jay Inslee who is a member of this coalition. Representative Inslee seems to have a vision for a performance focused program that provides the essential accountability and is now penciling out concepts that might really work.

So, the state of the industry early this year is uncertain. If you’re counting on an early improvement in the economy to bring business back, my sources tell me you will likely be disappointed. You could conclude that if you want to grow your business this year you’ll have to connect with the same disingenuous program promotions that have beleaguered our industry for decades. But I don’t think it is certain yet that this is your only option. If you really want to help move our industry toward a future that works, I invite you to join with those who want a more sustainable future. Let’s encourage Representative Inslee and others who are looking to make sure bold new energy programs are developed that really end up doing the right thing!



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