Thursday, March 18, 2010

Energy Costs and the Facility Manager: Fox Guarding the Chicken Coop?

Think about how energy efficiency providers interact with large facilities. Top managers don’t have time for utility issues because “they have a business to run.” They delegate the contact to the Facilities department, because these are the people who are closest to energy issues. Here’s where it gets interesting: energy is only one of many duties that compete for the facility manager’s time and budget. Note that Facility departments are cost centers, not profit centers. As a result, facility managers are not motivated by profit. Instead, they propose and maintain the largest budget they can. Their first priority is to reliably meet the comfort or productivity needs of the facility. Efficiency comes second (facility managers lose jobs over lapses of reliability, not efficiency, per se). In practice, a procurement person may manage the price at which energy is purchased, but volume is determined by the facilities department. Given the vagaries of weather, price variance, and other drivers of energy consumption, few observers will challenge a proposed energy budget. As a result, facility managers can use the “energy” line item to pad their operating budgets. As a consequence, a lot of facility managers do not want energy efficiency. It is perceived as a threat to their budget-- and the power that a budget provides. This is a real barrier to the implementation of energy efficiency. If providers of energy solutions work through a facilities manager, they have a two-part challenge: (1) to discern the true motives of the organization's facility manager, and (2) to position energy solutions in ways that resonate with that manager’s agenda.



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