a simply better business model for ebcx · mep/hvac assets, typically involving capital, that...
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A Simply Better Business Model for EBCx
Sandy Selman
Co-Founder/CEO
Sanus Connect, Inc.
AIA Quality Assurance
The Building Commissioning Association is a Registered Provider with The American Institute of Architects Continuing Education Systems (AIA/CES). Credit(s) earned on completion of this program will be reported to AIA/CES for AIA members. Certificates of the Completion for both AIA members and non-AIA members are available upon request.
This program is registered with AIA/CES for continuing professional education. As such, it does not include content that may be deemed or construed to be an approval or endorsement by the AIA of any material of construction or any method or manner of handling, using, distributing, or dealing in any material or product.
Questions related to specific materials, methods, and services will be addressed at the conclusion of this presentation.
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Learning Objectives
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• Expand capabilities and influence in providing consulting services to
owners
• Standardize the process for project investigation creating a quality control
layer
• Approach EBCx from the perspective of the client’s financial management
function thus increasing touchpoints for the EBCx provider within the
client’s organization
• Enable standardization in how EBCx projects are implemented
• Increase the probability that identified opportunities result in funded
projects
What problem did we solve for?
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• A global property management firm wanted to develop a
product to differentiate their service and take advantage of the
scale of their business.
Our observations
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• Capital plans are ultimately decided by asset managers without
the ability to distinguish “gotta haves” from “nice to haves” in a
site team’s wish list.
• Asset managers have no ability to know whether a site team’s
wish list even includes all the items they would want to know
about that can impact property valuation and cash flow.
Is there a more effective way to undertake EBCx?
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Asset Value
Operational
Sophistication
Capabilities & Condition
of Existing Equipment &
Systems
NOI
Infrastructure
Quality
Directly observe/measure these variables:
The data helps understand these inter-relationships … .... so property owners & managers
can drive better financial outcomes
Utility
Costs
R & M
Costs
Capital
CostsDeferred
Maintenance
A methodology is needed that utilizes direct examination of equipment, systems and
operating sophistication to empower asset managers and operators to make more
financially effective decisions around their MEP/HVAC infrastructure …
EBCx Tool Components (1 of 2)
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• Onboarding web app for Chief Engineers
▪ Gather basic information
• Mobile app-guided walkthrough and controls
interview (by EBCx team)
▪ Easy user interface
▪ Standardized and rigorous
▪ Dynamic questioning
▪ Designed for speed
▪ In-app data capture
▪ Highly scalable
EBCx Tool Components (2 of 2)
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Outputs
• CFO-friendly Decision Map that provides the
context necessary to confidently make capital
allocation decisions
• Back-up report with analysis and details
• Visual equipment library that also captures
any identified issues
Facility Improvement Measures (FIMs) Broadly Defined
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Operating SOPs: How do existing SOPs compare to best practices for buildings
with similar mechanical architecture and utilization? Our goal is to optimize
performance in view of the existing mechanical design.
Deferred Maintenance: What is the condition of key equipment and systems?
Projects: Are there opportunities to upgrade mechanical infrastructure that generate
an attractive ROI?
Utility Interface: Is there a more financially effective way to engage with the energy
market?
Data: Where and how can data play a role to improve operations and ensure
ongoing commissioning?
Deferred
Maintenance
Operating
SOPs
ProjectsData
Utility
Interface
The EBCx tool identifies opportunities to improve NOI and/or infrastructure quality in
five subject areas:
Organizing FIMs by Priority
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• Operating SOPs
• Deferred Maintenance
• Projects
• Utility Interface
• Data
FIMs
Mission Critical
FIMs that are essential
to the continued ability
of the building to
provide a safe,
comfortable and
functional tenant
environment.
Priority:
Low/No Cost
Items costing, in the
aggregate, < $150K
that deliver out-size
benefits and can
typically be included in
the R&M budget.
Priority:
Deferred Maintenance
FIMs that mitigate the
risk of unplanned
equipment downtime
and/or more expensive
maintenance or
equipment
replacement.
Priority:
ROI-Driven
Improvements to
MEP/HVAC assets,
typically involving
capital, that reduce
operating costs and
generate a discernible
ROI.
Non-Priority
Opportunities to improve
MEP/HVAC assets that
are discretionary due to
low/questionable ROI
and/or lack of
essentiality to continued
building performance.
Decision Maps Create Context For Capital Planning
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Legend
Mission Critical
Priority: Low/No Cost
Priority: ROI-Driven
Priority: Deferred Maintenance
Non-Priority
Essential
Discretionary
High Cost
Low ROI
Low Cost
High ROI
Replace steam DHW
Add enthalpy sensors
Re-engineer BAS sequences
TAB, I/O calibration Trend/monitor pumps/fans
Wireless pneumatic thermostats
Integrate chillers to BAS
Upgrade field control panels
Replace burner on pony boiler
(if do not electrify DHW)
Operator training
Re-evaluate energy sourcing
Install perimeter space temp sensors;
connect to BAS
Fans (except S-6)
• Refurbish/replace coils and pans
CV-1 through 5
• Instrument to benchmark
performance
• Refurbish, as indicatedCalibrate gas meter
Interval data on utility meters
Real-time monitoring:
heating/cooling plants
Retrofit 3-way valves to pressure-independent 2-way
VFD on primary river water condenser pump
Important Takeaways
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• This approach applies the EBCx Best Practice of prioritizing
measures based on building/owner’s goals
• The 5 subject areas listed above are the main goals of asset
ownership with respect to the MEP/HVAC infrastructure
• The Decision Map provides the common language for EBCx
teams to attain goal alignment with property ownership around
asset value maximization
• We make liberal use of the term “FIMs” because these
measures include improvements that have real implications for
asset value and go well beyond energy savings
The Pilot Process
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• The technique was tested on 3 downtown Chicago multitenant office buildings ranging
from 525,000 – 750,000 GSF, each with their own central plant.
• Two buildings were mirror images of one another, the larger was building was newer and
on the district cooling system.
• EUI and occupancy was quite different between the mirror image buildings – EUI was
lower in the building with the longer operating hours.
• EUI in the newer building was 2 – 3X that of the other buildings.
• The onboarding process engaged the chief engineer and general manager of each
property.
• A 4-person team walked each building – about 5 hours was required to gather all data.
Results
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• Approved MEP capital projects prior to the pilot fell into the “Non-Priority” category
• EUI discrepancy between the mirror image buildings attributable to different operating
style of the two chief engineers and a mis-calibrated gas meter
• Discovery of the broker OA damper mechanisms was the root cause of the high EUI in
the newer building – capital was re-programmed to address this issue and the chilled
water plant was cancelled
• A serious design flaw was discovered in the mirror image buildings that was overlooked
by the otherwise highly competent site team
• A package of low/no cost FIMs were approved “on the spot” for all 3 buildings
• The client expressed interest to apply the technique across the entire portfolio
Real Financial Benefits Delivered
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Facility Improvement Measures (FIMs)Est. Annual
Benefit
Cost To
Implement
First-Year
“Profit”
Approved “on the spot” (Low/No Cost) $455K ($367K) $88K
Cancellation of chilled water plant ($195K) $3,000K $2,805K
Repair OA dampers $450K ($660K) ($210K)
Theoretical initial 12-month cost (3 buildings) --- ($189K) ($189K)
Net First-Year Benefits $2,494K
Additional benefits not captured above:
• Identified 11 ROI-Driven and 9 Deferred Maintenance FIMs
• Highlighted training needs, particularly in respect of BAS operation and sequences
Benefits to Commissioning Firms
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• Utilize a scalable, repeatable methodology for EBCx
• Expand touch points within the client organization beyond engineering to the CFO or
asset manager – this is where the money is – to make your firm more valuable to your
client
• Generate recurring revenue from periodic audits
• Generate a proprietary sales funnel of project implementation opportunities with a higher
probability to be funded
• Leverage IoT and other technologies to enrich your data sets and extend your
competitive advantage
Sandy SelmanCo-Founder/CEO
Sanus Connect, Inc.
M: (203) 434-3005
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