Choosing the Right Energy Consultant
Given the current fiscal constraints under which PHAs and other multifamily properties are operating, most don’t have the luxury of having an energy manager on staff. And yet, since energy expenses constitute over 20% of a typical portfolio’s operating expenses, it is important to secure the capabilities of an energy expert or energy company to help identify and implement strategic energy savings opportunities that reduce costs and better position the organization for the future. Those opportunities can range from creating long term sustainable renewable options, procuring electricity and natural gas from more affordable sources, implementing passive energy solutions, to pursuing energy performance contracting and RAD.
As you put together your RFP to procure your energy consultant, here are seven tips to help you:
- Be Specific Yet Comprehensive – As you write your RFP, be specific as possible as to your immediate energy consulting needs and the tasks you want to be performed, but then include language that allows you to utilize your energy consultant’s expertise on other energy-related issues as they unfold. For example, if you develop an RFP to select an energy consultant to help you navigate the energy performance contracting process, list the specific tasks that you want to be performed but build in language that allows for the consultant to review and analyze and make recommendations on the annual measurement and verification (M&V) report provided by your energy services company (ESCO) or other entity during the term of the energy services agreement. This is to ensure that your EPC is performing as projected.
- Make sure that your Consultant is Knowledgeable about HUD Programs and Regulations – Selecting an energy consultant that is steeped in HUD programmatic and regulatory knowledge is crucial. The energy consultant should help you ensure that not only are you in compliance with HUD regulations but that you understand the interplay between various HUD programs and funding sources. For example, if you are contemplating whether to convert your portfolio to RAD (HUD’s Rental Assistance Demonstration Program), pursue an energy performance contract (EPC) or to redevelop your properties in another manner, make sure your energy consultant understands the big picture and knows the nuances between all of the programs and how best to evaluate what is in the best interests of your assets, your organization and your residents.
- Choose an Energy Consultant that is Knowledgeable about new Emerging Energy Savings Technologies – The energy field and related technologies is evolving rapidly. New generations of LED lights, breakthrough technologies like phase change materials that build in energy savings into building envelopes, and innovative locally distributed generation strategies like fuel cells, solar and wind are changing the ways we look at energy savings as well as sustainability, resiliency and disaster mitigation.
- Choose an Energy Consultant that is Knowledgeable about Financing Your Energy Infrastructure Improvements – As they say, it’s all about the money. You may have the best energy savings strategy in the world but if you can’t find a way to pay for it, it’s useless. Your energy consultant should know about a range of ways that your energy improvements can be paid for using rebates, incentives, and other techniques to complement traditional debt-based financing. And, the way we pay for energy enhancements is changing. New off-balance sheet approaches have surfaced that allows for energy improvements to be paid for without incurring debt. Your energy consultant should be able to help you navigate the options and find the best fit to meet your needs.
- Choose an Energy Consultant that is Knowledgeable about our Industry – Having an energy consultant that understands and is committed to our Industry is important. Having a consultant that is knowledgeable about Industry best practices will help your organization in not having to re-invent the wheel as you look at energy savings options.
- Choose an Energy Consultant with a Track Record of Success – Take the time to understand your prospective consultant and/or energy company. Do they have a track record of success in the areas that match up with your energy needs? And, be sure to Interview them and check their references! You are developing an often long term relationship with your energy consultant and you should invest adequate time to make the right choice that will stand the test of time.
- The Intangible – Choose an Energy Consultant that you can Work With! – And last, but not least, choose an energy consultant that is the right fit for your organization…one that you and your staff can work with. Finding the right consultant that is knowledgeable, competent, a good communicator, team-oriented and who is respectful to your staff from the administrative assistant to the CEO and your Board is extremely important. Finding an energy consultant with a good sense of humor helps as well.
“Fuel Cell Technology Applications for Public Housing” published in the Journal of Housing and Community Development May/June 2014, VOL. 70, NO. 3. Authors: Chris Fraga, Michael Nail, and Dick Santangelo
“The Intersection of EPC and RAD” published in the Journal of Housing and Community Development March/April 2016. Authors: Jaime Bordenave, Steve Morgan, Michael Nail, and Dick Santangelo
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