Cutting Costs Like a Boss: Partnering With Clients To Reduce Energy Bills

Bonus Material: Free Interactive White Paper On How To Sustainably Grow Service Income With a Predictive Service Model

Many of you know that after selling our company, AirAdvice, we launched BuildingAdvice. 

Our mission was to enable Mechanical Service Contractors to incorporate building energy savings as part of their service package for a fully scoped PM. 

Over time, we proved that sales and operating teams can stand out from the competition by using “Commercial Teaching Moments” to educate their clients and deliver something they value:

Measurable reductions in operating costs.

With today’s inflation and the absurd rate at which energy utility prices are rising (8-22% this year), I’m dusting off some of my old playbooks. nClarity’s Pulse IoT RTU Monitoring device (with its Utility Grade energy meter) is the perfect tool to help combat these rising costs.  

The nClarity Pulse is permanently installed on an RTU and captures real time performance data like temperature, RH, pressures, and kW consumption 24/7.

Reducing consumption is the linchpin of lowering energy utility bills (which harkens back to BuildingAdvice fundamentals).  

When you reduce consumption & lower the utility bill, you also reduce a facility’s carbon footprint.  So, you’re getting a 2 for 1 benefit for the customer when you reduce consumption, especially if they’re concerned with their emissions. 

The time has never been better for Mechanical Contractors to bring energy savings to the table when discussing a full service PM contract.

Before proceeding, let’s look at a few building blocks for this discussion:

  1. nClarity’s core focus is on monitoring small to mid-sized commercial/manufacturing facilities (<100k Sq Ft). That’s our sweet spot. Not our exclusive focus, just our sweet spot. This is the most underserved market when it comes to energy savings.
  2. The single largest (controllable) operating cost in a commercial building is energy.
  3. The largest consumer ( & potential waster) of energy in the building is the HVAC equipment. In this case, RTUs or Packaged Units. There are over 15 million units in operation today. They cool 70% of commercial space in North America, equivalent to 40 billion square feet.
  4. The nClarity Predictive Maintenance Platform is technically and financially optimized to monitor these poorly managed units.

click here to read our free white paper on service income growth with predictive maintenance

Ok, now that we have that out of the way….

Building Owners and Operators have 2 fundamental levers they can pull to improve financial performance and asset appreciation: 

  • Increase Revenue
  • Decrease Operating Costs

From about 2015 to early 2020, building owners had tunnel vision on the top line, relentlessly focused on driving ever-increasing revenue through expanding lease rates. Covid, with some exceptions (data centers, urgent care, etc.), put a damper on this pursuit as commercial facilities saw a significant drop in occupancy. 

Today, the market is in the process of reckoning with excess capacity. This has made decreasing operating costs critical to most facility operators focused on financial performance. 

It’s official: Energy is back in Vogue.

With energy being the single largest controllable operating cost in most commercial facilities, it's where building owners are starting to scrutinize more now than ever before. 

And with recent increases in utility costs, reducing consumption can be even more impactful.

Source: Statista. U.S Energy costs have risen 10% for electricity, 40% for gas, and 80% for gasoline in the last 2 years.

With mechanical (HVAC) equipment being the largest consumer (and waster) of energy in these buildings, Mechanical Contractors are in an incredible position to meet an unmet need.  

In a typical commercial building, energy accounts for 30% of the total operating cost. HVAC systems are the biggest users (and often wasters) of energy in a building, accounting for approximately 44% of total energy spend.

nClarity, drawing on our decades of experience, was built from the ground up to help Mechanical Contractors deliver exactly these types of benefits. Equipped with a built-in Utility Grade energy meter attached to each RTU, the nClarity Platform simultaneously:

  1. Prevents costly failures and increases uptime, consistently delivering comfort
  2. Extends equipment life 
  3. Monitors energy consumption in real time and identifies waste

We are uncovering a treasure trove of valuable insights that demonstrate the measurable impact nClarity has on mechanical equipment performance in these mid sized buildings. 

click here to learn how to sustainably grow yoru service income

Let me share a small sample of some of the insights we are uncovering:

  • Based on more than 5,000 Building Assessments conducted over a 10 year period, BuildingAdvice determined that 87% of buildings were over-ventilating their facilities.  This was a source of tremendous energy waste year round.
  • We’re seeing the same story at nClarity. We’ve found that many facilities are running fans constantly, even when no one is in the building. Correcting these issues has led to massive cost savings. View the case study here. 
  • Permanently gauging up each RTU with nClarity’s Pulse enables our analytics platform to analyze and rank RTUs based on energy efficiency (as well as many other parameters).
  • This analysis drives “R5”  productivity gains. It assures the Right Tech, with the right diagnosis, with the right tools, the right spares is focused on the right machine(s).
  • This data also speeds up the customer decision making process on RTU upgrades. Clear ROI can be predicted based on the data, which provides financial justification for replacement of older machines.

kW usage from an RTU that was being monitored by nClarity Pulse. Data revealed that the system fan was running when it should have been off, drawing 13kW. Correction of the issue across all RTUs at this facility resulted in $40,000 in annual energy cost savings.

The echoes of BuildingAdvice in the nClarity platform are also seen in SavingsTracker, a tool that’s been used in hundreds of buildings to measure and verify energy savings from PM and equipment upgrades. Using utility bills and other data sources, it provides a building-wide view of consumption and utility bill savings on a monthly and quarterly basis.

Taking the monthly “Pulse” (no pun intended) of a building’s energy consumption, driven by real time RTU efficiency data, has tremendous promise. Let’s reconsider my opening statements:

  1. The single largest (controllable) operating cost in a commercial building is energy.
  2. HVAC is the biggest consumer (and waster) of energy.
  3. The nClarity Predictive Maintenance Platform is technically and financially optimized to monitor these poorly managed units.

Mechanical Contractors, armed with a platform like nClarity, will be poised to deliver an unmatchable value proposition as part of their service offering:

  • Measurable Reductions In Operating Costs (Utility Costs)
  • Assured Uptime
  • Extended Equipment Life
  • Consistent Comfort

The fun part is packaging up the data in meaningful, digestible, & impactful ways for the customer. Much of my future blogging and education will be about this exploration into customer engagement, and the impact it has on building owners and operators.

The SavingsTracker report can be used to show customers the measurable ROI driven by your services performed, and to help justify the need to replace an aging RTU.

nClarity is committed to sharing our observations, samples and case studies to help lead the industry-wide adoption of a Predictive Service Model. Those who pivot will enjoy a more efficient, sustainable, & profitable business in the future of HVAC. 

click here to read our free white paper on service income growth with predictive maintenance

Interested in learning more about how nClarity can help your business? Fill out the form below to get more info about the latest AI-Driven Predictive Maintenance technology for Mechanical Contractors.