Current customer base and online project databases offer green project possibilities

Distributors wanting to enter or expand their current sales in the energy management market can use several sites on the Internet to find project leads, but your current customer base is the first place to look for growing sales. Consider revisiting all of the energy management proposals you might have made since 2007 and updating them to reflect current electricity prices; local, state and federal incentive programs, and new regulatory requirements. If the payback becomes shorter and more convincing, resubmit the proposals to the customer and highlight the changes. The Database of State Incentives for Renewables & Efficiency is the most comprehensive source of information on federal, state, local, and utility incentives and policies that promote renewable energy and energy efficiency.

Energy efficiency is a core component of the LEED rating system, so any project that registers for LEED certification is likely to require energy products and services. The USGBC provides a searchable database of LEED registered projects. Looking for projects in your area can generate sales leads, especially since new construction projects and major renovations tend to have long gestation times.

The American College & University Presidents Climate Commitment (ACUPCC) and the U.S. Conference of Mayors Climate Protection Agreement are both seeking to reduce greenhouse gas emissions through energy management projects. Signatories have committed to improve the energy efficiency of the built environment within their jurisdictions. More than 1500 cities and higher education institutions, large and small, have committed to these changes; that’s a large number of potentially significant leads.

Knowing where to look for potential sales, how to pitch projects to customers, and how to present energy and environmental services and products can help proactive distributors stay ahead of the competition. For more tips on selling energy management projects, please refer to NAED’s Selling Toolkit.

Programs such as the Federal Energy Management Program (FEMP) help federal agencies meet green goals and provide new sales opportunities for the industry as a result.

The U.S. Department of Energy’s Federal Energy Management Program (FEMP) has ambitious clean energy goals. Clean energy is an umbrella term that is used to encapsulate efficient, low-carbon, and renewable energy sources. As the largest energy consumer in the U.S., the federal government has embraced a prime opportunity to lead by example. FEMP is a key component of this task because it is responsible for helping federal agencies meet energy management goals, including:^[1]

• Reducing energy intensity 30% by 2015 from 2003 levels
• Reducing water intensity 16% by 2015 from 2007 levels
• Generating or purchasing at least 7.5% of electricity from renewable sources by 2013

Energy (or water) intensity measures the amount of energy (or water) required to produce a given level of output or activity. It can be used to measure the amount of energy it takes to manufacture a product or to produce a certain level of Gross Domestic Product (GDP). For instance, U.S. energy consumption in 2004 was about 100 quadrillion (10¹⁵) Btus and the GDP was estimated at $11.74 trillion. These figures produce an energy intensity ratio of about 8500 Btus (9 megajoules-MJ) for every dollar of GDP.^[2]

FEMP will use American Recovery & Reinvestment Act funding to develop an energy, water, and greenhouse gas emissions reporting and tracking system for federal facilities. This system will help the government achieve its energy management goals.^[3] As noted in NAED’s “Findings in Brief: The Green Market” white paper and “The Energy Management Market for Government Buildings” case study, the stimulus act and the government’s clean energy goals provide numerous opportunities for electrical distributors to sell energy management products and services.

^[1] http://apps1.eere.energy.gov/news/daily.cfm/hp_news_id=193 accessed August 12, 2009.

^[2] http://www1.eere.energy.gov/ba/pba/intensityindicators/total_energy.html accessed August 12, 2009.

^[3] http://apps1.eere.energy.gov/news/daily.cfm/hp_news_id=193 accessed August 12, 2009.

Emergence of Water Efficiency

As businesses, consumers and government entities become increasingly aware of the overall environmental and economic impact of their decisions, water efficiency is emerging as the next big topic in the green movement. General Electric Co. executives recently predicted that their water products and services division could quickly become a major growth driver, likening the potential of the water business to their recent and rapid success in the wind business.¹

What is WaterSense?

WaterSense seeks to promote the market for water-efficient products, programs, and practices. Launched in 2006 by the Environmental Protection Agency (EPA), WaterSense helps consumers identify water-efficient products and programs by labeling products and programs that perform as well or better than their competitors and use at least 20 percent less water than their competitors.²

WaterSense Products

Today, consumers can choose from more than 300 high-efficiency toilets (HETs) and more than 1,000 types of water-saving faucets and accessories that have earned the WaterSense label. In 2008 alone, WaterSense labeled toilets, faucets, and faucet accessories helped Americans save an estimated 9.3 billion gallons of water - enough water to supply 100,000 average households for a year - and realize more than $55 million in savings on water and sewer bills.³

WaterSense Partners

WaterSense partners with manufacturers, retailers and distributors, utilities, state and local governments, nongovernmental organizations, trade associations and irrigation professionals to bring water-efficient products to market and to endorse the WaterSense label.

Ferguson Enterprises, the country's largest wholesale distributor of plumbing supplies, partnered with WaterSense in 2007.

¹ http://www.reuters.com/article/bondsNews/idUSN2235851820090811

² http://www.epa.gov/watersense/pubs/every.htm

³ http://www.epa.gov/watersense/news/current/summer2009.htm

Determine the impact of energy saving solutions by using measurement and verification (M & V) tools.

Two of the Obama Administration’s stimulus programs focus specifically on energy efficiency: the Energy Efficiency and Conservation Block Grant Program (EECBG) and the State Energy Program (SEP). Combined, these programs offer just over $6 billion in funding for various energy efficiency projects, but they require project participants to measure and provide verification of energy savings. For instance, the EECBG program requires grantees to report energy savings per dollar invested to the Department of Energy.^[1] To help customers using these programs meet new regulatory requirements for transparency and effectiveness, electrical distributors should be familiar with measurement and verification (M&V) protocols.

M&V provides reassurance for the customer (and the government) that what was promised in the energy project proposal is actually delivered. Some incentives and rebate programs may also require M&V. Many Energy Service Companies (ESCOs) offer performance guarantees as a method of verifying energy savings. Energy service providers, facility managers, and building owners can all follow M & V guidelines to determine whether or not energy savings were actually achieved. The U.S. Department of Energy’s Federal Energy Management Program (FEMP) developed a Measurement and Verification Guideline for Federal Energy Projects to help with before-and-after energy use comparisons. These guidelines can be scaled up or down depending on the complexity of the energy project. The Efficiency Valuation Organization’s International Performance Measurement & Verification Protocol (IPMVP) also provides guidelines on how to measure systems in isolation or to conduct whole building comparisons. This protocol is also referenced in the LEED rating system, under Energy and Atmosphere credits.

What does this mean for the electrical distributor? A chance to sell customers more sensors and other measurement systems, not only for these specific stimulus-funded projects, but also for all the LEED projects that choose to pursue the point(s) for using M&V systems. For more information, see NAED’s Findings in Brief: Services & Solutions to Help Customers Go Green.

^[1] http://www.eecbg.energy.gov/about/FAQ.html#lh1 accessed August 11, 2009.

Retailer Reduces Environmental Impact

Wal-Mart High Efficiency (HE) pilot stores help the world’s largest retailer reduce energy use and greenhouse gas emissions.

As the world’s largest company, Wal-Mart has a tremendous impact on the environment.^[1] Over the past few years, the company has been building High Efficiency (HE) pilot stores to reduce their energy use and greenhouse gas emissions.

Wal-Mart introduced the sixth generation of HE pilot stores last summer in Sacramento, California. The store is climate-specific, using a combination of evaporative cooling and radiant flooring technologies to cool the stores. Cool water is produced in roof-mounted cooling towers and then pumped through the radiant flooring system to cool the retail space.

This system uses less energy than traditional air conditioning. HE pilot stores also feature daylight harvesting through skylights, which reduces lighting energy by up to 75%, and LED lighting, which is 70% more efficient than traditional fluorescent lighting. Overall, the Sacramento store is 30% more energy efficient than the 2005 Wal-Mart supercenter baseline.^[2] Wal-Mart uses energy management systems in all of their U.S. stores and Sam’s Club locations.^[3]

It is important for electrical distributors to be aware of what retailers are doing in terms of sustainability. According to a 2009 survey of NAED members, 44% of respondents identified retailers as an end user of energy management solutions. For more information on selling energy management solutions to commercial customers, please refer to NAED’s “Selling to the Commercial Market“ case study.

[1] http://walmartstores.com/FactsNews/FactSheets/ accessed August 5, 2009.

[2] http://walmartstores.com/FactsNews/NewsRoom/9203.aspx accessed August 5, 2009.

[3] http://walmartstores.com/Sustainability/9124.aspx accessed August 5, 2009.

In the growing green market, distributors may consider plug load controls to help customers meet their energy management needs.

Plug loads account for 15 to 19% of residential energy use^[1] and about 20% of commercial energy use in the U.S.^[2] Plug loads grew by 12 to 14% in 2007 and it is safe to expect similar growth in the coming years.^[3] Most plugged-in devices use energy even when they are turned off. This type of energy use is often referred to as phantom load or vampire energy. Electronics draw power through two types of standby modes: passive and active. The clock on a microwave is an example of passive standby. An example of active standby is a DVD display when it is programmed to record something. Even cell phone chargers still draw power when they aren’t actively charging a cell phone battery. 22% of plug load electricity is used in standby mode.

There are several devices that can help reduce plug loads. GreenSwitch™ is an innovative device that can wirelessly control wall plugs and light switches, allowing users to control plug loads with one switch. Wattstopper/Legrand offers Isolé Plug Load Controls; surge protected power strips with occupancy sensors. When no one is present, peripheral office equipment is powered down to reduce energy consumption.

Controlling plug load growth is an important energy management strategy. Electrical distributors should consider offering plug load controls to all customers as a means of accessing the growing energy management market. For more information on plug load controls, please refer to NAED’s Going Green – Inside and Out white paper, How to Profit from Green Market Opportunities available at the NAED Learning Center.

[1] https://touchstoneenergy.cooperative.com/public/programs/EnergyEfficiency/documents/EnergyUseofHouseholdElectronics.pdfaccessed August 10, 2009.

[2] Sabo, Carol. “Plug-Load Energy-Efficiency on Campus”, a presentation given at the Advanced Design and Technologies for Higher Education Facilities Workshop in Lansing, MI September 23, 2005. PA Government Services, Inc.

[3] http://www.todaysfacilitymanager.com/articles/does-it-pay-to-pursue-plug-load-reductions.php accessed August 10, 2009.

Companies with strong sustainability plans need actionable strategies to ensure optimal business, environmental, and social performance. In May 2009, the Aberdeen Group released the results of a study that investigated how best practices in sustainability are linked to business return on investment (ROI). “The ROI of Sustainability: Making the Business Case” recommends a number of sustainability practices and shows how companies excelling at these see higher ROI for their efforts.

Practices that help companies excel in sustainability efforts include corporate leadership, developing metrics, setting policies and standards, improving stakeholder communications, educating staff, and formalized reporting. Using dashboards to deliver sustainability metrics in a user-friendly way is also a highly recommended practice. Dashboards provide a visual means of gauging how well a company is doing on various indicators, like energy and water use. They often come in the form of websites or “apps”.

The study used six key performance criteria to differentiate “Best-in-Class” companies. These companies achieved the following returns on their sustainability investments:

• 9% reduction in carbon footprint
• 6% reduction in energy costs
• 7% reduction in facilities costs
• 10% reduction in paper costs
• 7% reduction in transportation / logistics costs
• 16% increase in customer retention

For more information on sustainability practices tailored to the electrical distribution industry, please refer to NAED’s “Inside Going Green – Little Green Book of Corporate Sustainability.”

Source: Cindy Jutras and Jhana Senxian, “The ROI of Sustainability: Making the Business Case,” Aberdeen Group, May 2009.

Available at: http://www.aberdeen.com/summary/report/benchmark/5908-RA-sustainability-environmental-stewardship.asp