Breaking New Ground

When marketing energy services, the electrical contractor usually focuses on customers with existing facilities that can benefit from reducing energy use and improving operational efficiency. Most ECs do not consider new construction—­which includes the building of a new facility—or the renovation or expansion of an existing facility as a viable market for energy services. However, energy services expertise can be profitably applied in the new construction market, and there are ways that the EC can use its energy services expertise to stand out from its competitors and gain an advantage in the new construction market.

Design/build projects

Most electrical contractors’ traditional energy services work stems from its design/build and service contracting capabilities. As a result, it is only natural to consider design/build projects as the logical place to profit in new construction. With a design/build project, the EC provides both design and construction services based on the owner’s project requirements. Such services can include power, lighting, communications and control systems. Applying energy services expertise to a design/build project can lead to an energy-
efficient facility with reduced operating expenses and a better return on investment for the owner.

The best way for the EC to benefit from its energy services expertise is to apply it during the proposal stage of the design/build project. Design/build projects typically require a technical proposal from each team, showing how the team intends to meet the owner’s project requirements. Proposals are evaluated on a set of criteria established by the owner. The design/build team that best addresses the project criteria is awarded the contract for the project. 

The owner’s criteria for selecting the successful proposal can range from simply meeting requirements at the lowest price to a more complex selection process that considers the design/build team’s proposed facility design along with its qualifications. If the owner’s selection process rewards innovative design solutions that include energy efficiency, the EC can use its energy services expertise in its portion of the proposal to focus on the owner’s need for electric energy conservation, efficiency, production and reliability.

Even if the owner’s selection process is based solely on low price, the facility will still need to meet energy codes adopted by the authority having jurisdiction. In addition, the design/build project contract may require the facility to meet third-party green building certification requirements. In this case, the EC will have an opportunity to apply what it has learned from its energy services business to meet the owner’s low-price selection criterion while incorporating the required energy code and third-party green building certification requirements.

Design/bid/build projects

The electrical contractor can also profit from applying its energy services expertise to design/bid/build projects. In most cases, the EC’s scope of work will be limited to the installation, and the design of the required power, lighting, and communications and control systems will be done by outside consulting engineers and designers. Design/bid/build projects restrict the electrical contractor’s ability to affect the design directly during that phase of the project when it is most efficient. However, during the bid period when the EC is reviewing the project plans and specifications, it can use its energy services expertise to identify alternative products and installation methods that can either reduce the owner’s initial construction cost or improve the facility’s energy efficiency. These can then be included in the EC’s bid as voluntary alternatives that either result in deductions or additions to the bid price for the owner to consider. Alternatives identified after the start of construction can be discussed with the owner and incorporated into the work through the change order process. Whether accepted by the owner or not, these proposed alternatives can establish the electrical contractor as an expert in energy services work in the owner’s eyes, a designation from which the contractor could garner future work.

Profit from energy services expertise

Electrical construction is a knowledge business, and the EC needs to explore ways to diversify and monetize its energy services expertise in other areas of its enterprise. The electrical contractor can use its energy knowledge on new construction projects. Building a successful energy service business requires an investment in people and equipment, and sharing these resources with other parts of the business can only increase the return on investment. Not sharing the energy services expertise throughout the company would be like investing in a new piece of equipment for intermittent use and then letting it sit idle at all other times. Instead you can spread the investment throughout the firm and reap the financial benefits of increased use.

About the Author

Thomas E. Glavinich

Freelance Writer

Thomas E. Glavinich was an associate professor in the Department of Civil, Environmental and Architectural Engineering at the University of Kansas. His tenure as one of Electrical Contractor's most trusted and reliable source of industry research...

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