8. How accurate are the projected energy savings?
Honestly, every factor has some level of error. One of the most important things that we do at The First Energy Group is to make sure we always make assumptions that err on the conservative side. We are usually not aiming for engineering accuracy – our calculated projections are designed to be intentionally less that what you will see. Every time we have later looked WE HAVE SAVED OUR CLIENTS MORE ENERGY THAN WE HAVE PROJECTED. We knowingly err on the conservative side. No one ever gets upset with us when we save them more than we project.
Ok, let’s look at where these inaccuracies arise and how we handle them. First, let’s look at the cost of energy. We can very reliably calculate your cost of energy. However, your cost of energy may change. Energy costs are strongly influenced by politics as well as supply and demand. As a general rule your cost of energy is increasing – sometimes very quickly. The savings we forecast are always conservatively based upon your historical cost of energy. In reality we expect your energy costs to increase above what we forecast. If they do increase faster then your savings are even greater than we project. In the unlikely event that we have a long term decrease in the cost of energy our forecasts would be in error. And, the greater the drop in the price of energy the greater our projections will be off. So, your first item to consider is what the price of energy will be in the future. 
Now, let’s look at how we determine how much energy The First Energy Group can save you. We assume you are currently using energy efficient ballasts when we review your existing fixtures. Once again we’re not looking to be the most accurate we’re looking to make sure our projections are conservative. If you’re actually using non-energy efficient fixtures, as many facilities are, then our forecasted savings will be significantly in error and your actual savings will be much better. Once again, we conservatively estimate your fixture wattages.
When we are looking at other equipment such as HVAC, Chillers, Boilers, motors, etc. we use the manufacturer’s specifications to determine the energy they use. We know these numbers are conservatively in error. Manufacturers specify their equipment in new condition. We know your equipment has been used, sometimes for many years, and we’ve never seen any equipment actually get more efficient in the field. The reality is that equipment gets dirty, filters are not immaculate, buildup occurs all over the place, and mechanical systems erode. So even though we specify things by manufacturer specifications we know this equipment is using more energy than when in new condition and also that the output (light or heat) is not as high as when new. These factors all lead to further inaccuracies in our calculations. However, all this wear and tear and inaccuracy works in your favor. We assume everything is perfect and make our projections based upon that. Any imperfections provide you with additional savings. Once again, The First Energy Group is making conservative assumptions that benefit you. There is really not much for you to consider here since The First Energy Group does all the work. However, it is always a good idea to spot check any proposals. It’s always a good idea to understand what you’re getting.
We interview you to determine your operating hours. In reality this is where the larges source of errors is likely to occur. Our clients are in the best position to determine their operating hours. If you cut your shifts back or do not operate as you represent this may have a significant effect on your projected savings. Although this area is the source for the largest amount of error we have found, in our experience, most clients tend to under state how much time their systems are really on. They tend to ignore the night circuits that are always on, or forget that their maintenance and cleaning crews keep the lights and/or HVAC systems on beyond what they consider normal. All of this missed time causes your actual savings to be greater than we project. In any case if there is one area that you should check on our proposal it would be your operating hours. This is one of the most important things that you can do to ensure the reality of your projected savings.
Finally, there are certain factors that are just not easily knowable. Things like how many hours your AC compressors are actually operating (They don’t operate full time even when you AC unit is on.) or the effects of various control devices. For these types of systems we reference published standards that groups such as ASHRAE (American Society of Heating, Refrigerating and Air-Conditioning Engineers) and manufacturers make available. Honestly, there is potential for more errors to be introduced here. However, just like everything else we do, we attempt to apply these standards conservatively. We knowingly accept errors as long as they conservatively point in your favor.
As you can see we always use conservative assumptions when calculating savings. We want to under promise and over deliver.
