While a previous post explained the benefits of performing an investment-grade audit (IGA) and what all it should entail, it is important to remember that not all IGAs are created equal. This post and an upcoming post will detail some of the deficiencies in IGA reports and how to prevent these deficiencies from occurring.

Deficient audits can create major issues in reporting, including:

  • Inconsistent energy costs, demand costs, and operating hours of various areas within the facilities—especially when the basis for the considered demand cost is unclear
  • A lack of energy balance, which can lead to overestimated cost savings
  • A lack of a clear description of the energy rate schedules and annual energy usage, in which customers do not clearly understand how they are being charged
  • A lack of equipment inventory and ratings
  • No clear identification or description of a retrofit strategy
  • Overestimated savings due to lack of consistency
  • Overlooking the latest retrofit technology
  • Ignoring measures that may exist in similar facilities but do not exist in the surveyed facility

Comprehensive IGA reports should provide a clear picture of the facility’s energy supply and consumption and act as a roadmap for improving energy utilization and reducing costs. However, if IGA reports lack some key components, it may be a result of a:

  • Lack of expertise of the people who perform the surveys or prepare the report. Although taking inventory of equipment is fairly straightforward (filling out a site sheet), it often takes a clear understanding of complicated systems (e.g., what a multiple-chiller system is) to identify any meaningful potential energy efficiency improvements.

  • Lack of basic knowledge of fundamental engineering principles. Energy efficiency work is multidisciplinary, which means that auditors need to have a strong understanding of the fundamentals of mechanical and electrical engineering. It is a good idea to have a professional engineer oversee comprehensive energy audits.

  • Lack of training in using sophisticated simulation software and various derivatives. Even the most sophisticated computer programs can produce incorrect results if proper data (e.g., operating hours, load factors, etc.) is not used or properly applied to a specific situation.

  • Conflict of interest. The firm that conducts the survey and prepares the audit report is often the same firm or is affiliated with the firm that will do the engineering design and implementation (such as full energy service companies). For example, a firm may be hired to do a comprehensive energy audit, but may fail to take inventory of all equipment and evaluate it as an essential aspect of an overall lighting retrofit project. Other examples of this sort of conflict of interest can occur if the audit reflects unrealistic operating hours, utility factors, and equipment load factors. An oversized 50 horsepower fan motor may operate at 50% of its load, but this data will not show up in the plant audit if the auditor fails to measure the power draw.

An upcoming post will provide more information about this topic, and will present questions that can serve as a checklist to use during preliminary screening of an IGA to assess its ability to conduct this sort of audit. For additional questions regarding IGAs and/or energy savings performance contracts (ESPCs), please comment to this post or submit a request through the Technical Assistance Center. 

Content for this Blog post courtesy of Sentech-SRA/ICF International