How to Avoid Energy Audit Disasters
John Avina, C. E. M.
Director, Abraxas Energy Consulting
September 8, 2007
There are a few problems that work against you when trying to find a company to perform a good energy audit for you.
- Everybody and their brother now claims to do energy audits
- Nobody quite agrees on exactly what an energy audit is
In this paper, I am going to cover these problems and then tell you how to select a quality energy auditor and not get ripped off.
Everybody and their Brother Now Claims to do Energy Audits
With the struggles of the economy in the United States, everyone who is not making money is looking around to see what sectors are still making money. Energy consulting has done well so far. The energy consulting companies are not laying off people, rather, they are hiring. And with the focus on cost-cutting, companies are starting to realize that utilities are not a fixed cost, but actually, a cost that can be reduced by 10% to 30%. Throw in the promise of stimulus funds, and you have a new service offering for companies that are seeing their sales plummet. We are seeing real estate management companies, real estate brokers, electrical and mechanical contractors, and equipment sellers all trying to sell and perform energy audits. On top of that, now some of the very large companies have entered the market. And then there are the legions of unemployed who are constantly calling us asking us to teach them how to become energy auditors. There is a good and a bad to the rush into energy consulting. The good is that with more competitors, costs go down. The bad is that the with decreased costs the quality of the work suffers as well. Companies new to auditing often don’t have experienced auditors and produce poor quality audits Often these contractors and real estate companies don’t even do the audits themselves, but contract them out to others. They are just taking a cut off the top.
Every Company has a Different Idea of What an Energy Audit is
Energy Audit was a term that just had too many meanings. Two different companies could theoretically perform an energy audit, and one could spend 5 hours, and the other 80 hours. With this type of variation in audits, the customer and the auditor often had different ideas in mind on just what was to be done.
The American Society of Heating Refrigeration and Air Conditioning Engineers (ASHRAE) has taken important steps to clarify just what should comprise an audit. ASHRAE has defined the requirements for 3 levels of audits, entitled ASHRAE Level 1, ASHRAE Level 2 and ASHRAE Level 3 audits. Because of this, a customer can ask for a Level 1 audit, and all the vendors should be able to deliver the same level and quality of report. Unfortunately, this is still not true.
Recently we placed a bid for $4,500 for an ASHRAE Level 1 Energy Audit, and were beat by the competition that did the audit for $823. We typically spend about 40 to 50 hours on an ASHRAE Level 1 audit. Assuming our competitor spent 40 hours, and charged $823, that comes to charging $20/hr for the work, which you know they didn’t do. We figured that either: the auditor that won the job is not delivering much, the auditor is using the audit to sell products and services, or the auditor is being paid very little.
Fortunately, we got to see the $823 audit once it was completed. The auditor didn’t deliver much. It was 3 pages, and a handful of ASHRAE forms filled out. Although it was sold as an ASHRAE Level 1 audit, it wasn’t. The audit did not address most of the ASHRAE Level 1 requirements. Customers just don’t know what comprises an ASHRAE Level 1 audit. That is the problem.
You Get What You Pay For
Think about it, you do get what you pay for. Right now in San Luis Obispo California, plumbers are going for $100/hr or more. Energy auditors, with the same amount of experience, but also, who have studied energy in school (most are mechanical engineering graduates), and have learned a highly technical field should be charging more than your local plumber or electrician. When you get a quote for an audit, just divide it by $100/hr, and you will get a ballpark number of hours they expect to spend on the job. Experienced, credentialed energy auditors in the US are commanding about $100,000/year right now. Good auditors are expensive, but so are good plumbers. You get what you pay for.
Why Some Companies Offer Free or Nearly Free Audits
Some companies will offer energy audits for free, or nearly free. When this is done, usually the company offering the audit is trying to sell an “energy saving” device, or perhaps wants to do the installation on the energy efficient measures once they are found. I have no problem with the second type of vendor, as their audits may be good, but often the first type of vendor is typically not providing a comprehensive energy audit, but only an audit that focuses around their product. What is important for the customer is that these limited scope audits are going to miss some real energy savings opportunities due to the auditor’s narrow focus.
There are also well-meaning nonprofits who will perform audits for free. These audits are often very cursory, and are not performed by experienced auditors. Often these nonprofits will get a grant to save energy. The grants are usually not for very much money, and as a result, they cannot hire experienced energy auditing staff. The result is poor work.
Finally, some utilities are now performing energy audits for free. In some cases, this can be a tremendous opportunity. In California, for example, for the investor owned electric utilities hire experienced professional energy consultants to do the work. The audit is free to the customer, but the utility is paying the going price for the audit. They get good audits. On the other hand, some utilities will use their own staff to perform the audits, and sometimes their auditing staff doesn’t have the experience to perform satisfactory work.
Experience Really Counts with Energy Audits
Energy auditing is not just finding inefficient lighting fixtures and suggesting they be replaced with more efficient fixtures. This is, indeed, part of the job, but this is the easy part. Auditing requires a thorough understanding of chillers, boilers, air handlers, package units, control systems and their components, not to mention compressed air and domestic hot water.
You see, energy audits of commercial buildings are not something you can learn in a week. It takes years of learning, making mistakes, and watching others make mistakes before you can become adept at energy auditing. There are an infinite number of HVAC configurations possible. Experienced auditors uncover these new situations every year.
The problem with inexperienced auditors is that they are more likely to miss energy conservation opportunities, or they may make suggestions that just don’t work, or some that may result in damage to your equipment.
How to Select a Good Energy Auditor
So when you select an auditor, it is very important you go with someone, or a company that has years of experience. I would suggest 10 years at the least. The way to ensure that you are getting a quality audit is to ask for the resume of who is going to perform the audit, and get some references. The auditor should be a Professional Engineer (PE) and/or a Certified Energy Manager (CEM). If they are not, then you are taking a big chance. Also the auditor should have at least 10 years under their belt. You don’t want them learning the trade on your job. Also, get a sample audit or two. You should know what you are paying for. With sample audits in hand, then you can make sense of the different prices you get from potential energy auditors. Finally, please ask for references, and call them. Find out if your auditors were professional, met their deadlines, and provided quality work.
When you are evaluating companies:
- Talk to 2 or 3 companies and select the best one.
- Ask for Resumes of who will actually be onsite. Ensure that the lead auditor has 10 years of experience or more. Also be sure that they have at least 10 years of experience doing energy audits. A lot of times you will get resumes of their best people, and they will send their junior level people onsite. Make sure you get resumes of who will actually be doing the work.
- Ask for sample energy audits from the company. Since all of your potential vendors are going to be producing audits of differing quality, you can now judge and rank the companies on the deliverable. Also you can now weed out the companies that are not providing quality analysis.
- Ask for References of some jobs they have done recently. You don’t have to call them. First make sure that the references are for energy auditing jobs, and not some other task. If you do plan on calling them, find out if they finished work on schedule, whether the reports were accurate, and whether the reports met expectations.[1]
- Use a decision tool. I will present a sample grid below. I have assigned a weighting factor to each of 6 categories. You probably would weight them differently. It is important that you take the time to understand what is important to you. I think all the categories are obvious except the last one, which I labeled “Trust Factor”, which tells how much you actually trust the auditor based upon conversations with them. Some salespeople are very good at inspiring trust, only to rip you off later. It is up to you of course, which factors to use in your own evaluation. Each company is scored based upon each of these factors, and a weighted score is then calculated for each company. This type of decision tool is mostly analytical, and should help you to make the best choice for an energy auditing company.
This is what government typically does, although they sometimes put out Requests for Proposals (RFPs) that are so demanding that they require the energy auditing companies to work for days just to get a shot at the job. I would suggest, if at all possible, avoid using a detailed RFP process as the best auditors may also be the most busy, and might not have the time to spend putting together an RFP response.
These suggestions I have given should apply to buildings over 100,000 SQFT. If you are considering audits of small facilities, such as 20,000 SQFT, the work and costs involved are not that great and taking so much care to select the best auditing company is probably overkill. Still, don’t select an auditing company based solely on price, or you will be sorry.
About the Author
John Avina, President of Abraxas Energy Consulting, has worked in energy analysis and utility bill tracking for 15 years. During his tenure at Thermal Energy Applications Research Center, Johnson Controls, SRC Systems, Silicon Energy and Abraxas Energy Consulting, Mr. Avina has managed the M&V for a large performance contractor, managed software development for energy analysis applications, created energy analysis software that is used by well over a hundred energy professionals, taught over 200 energy management classes, created hundreds of building models and utility bill tracking databases, modeled hundreds of utility rates, and performed and managed energy audits of over 300 buildings (over 15 million square feet of building stock). Mr. Avina has a MS in Mechanical Engineering from the University of Wisconsin-Madison. He is a member of the American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE), the Association of Energy Engineers (AEE), the American Solar Energy Society (ASES), and a Certified Energy Manager (CEM) and Certified Measurement and Verification Professional (CMVP).
Abraxas Energy Consulting provides utility bill tracking, energy auditing, measurement and verification, retro-commissioning, utility bill auditing and other energy management services for its clients world-wide. In addition Abraxas Energy Consulting provides a selection of utility bill tracking and interval data software packages for its clients. Abraxas Energy Consulting’s clients are: ESCOs, utilities, energy consulting companies, government, universities, hospitals, school districts, private industry, real estate management companies, and building owners.