Conserve Your Energy

Energy costs can be variable and developing a program to control — or even better, reduce — energy costs should be welcome by the key decision-makers in any organization. Facility managers (FMs) need to understand the best way to present such a proposal to management. PRSM’s new white paper outlines those steps in a clear and concise fashion. 

The first step involves understanding the perspective of the decision-maker. While an FM might have spent a great deal of time researching and refining a new energy proposal, this effort might not be top of mind for the decision-maker. Knowing this will help you understand why it might take some time for the decision-maker to absorb the details you are presenting before giving it the green light.

Second, the paper outlines the decision-making process management uses to evaluate multiple aspects of any change to business. The authors have broken the process into three categories: operational analysis, financial analysis and strategic analysis. An energy (or any) proposal presented by the FM should outline the operational benefits to the business, demonstrating feasibility as well as any operational impact. The proposal should also show an understanding of how a new energy plan is a strategic fit for the enterprise — for example, the change could allow the company to promote its eco-friendly credentials. And, of course, what the financial costs and savings will be.

The third step presented in the paper familiarizes the FM with financial terminology. This explains basic terms and concepts so you can draft your proposal with them in mind. For example, the saving-to-investment ratio, or SIR, is described as a different way to present ROI, or return on investment. Your proposal should include a statement projecting the total energy savings over the lifetime of the project, divided by the initial investment cost.

The white paper’s fourth step stresses the importance of timing. A critical part of your research into a new energy provider or new equipment (such as LED lighting or high-efficiency HVAC) should be investigating what incentives are available from the manufacturer, energy provider or government agencies and if there are deadlines to meet. There might be key deadlines that boost bonuses or offer savings on equipment or taxes, so draft a thorough timeline that makes the timing clear to decision-makers — they won’t want to leave any money on the table.

The fifth step reminds the FM that a proposal that has a “hook” has a better chance of succeeding. The hook would be some aspect of the new energy program — beyond saving money — that clearly demonstrates the value in terms the decision-makers can quickly grasp. An example included in the paper cites the number of items that would have to be sold at retail (25,000 $10 travel bags) to equal the energy savings. As long as the example is concrete and accurate, it should help make the case. 

Last, step six urges the FM to keep the proposal to one page. Presenting the key information in an easy-to-digest format shows you understand the value of the decision-maker’s experience, judgment and ability to make good decisions. Of course, you can — and probably should — have documents that back up your estimates, in case the decision-maker requests them.

The white paper includes two documents to help the FM structure the proposal. The first is a worksheet to calculate savings associated with the new proposal, and the second is a template to create a streamlined one-page proposal. 

Authors of the White Paper

Stephen Dixon and Sam McKnight are consultants with more than 30 years’ experience in energy conservation and systems design engineering. 

Read the PRSM white paper “6 Steps to Getting Energy Proposals Approved.” Visit https://www.prsm.com/Education-Resources/Resource/i/WP_6STEPSTOGETTING