9. How does The First Energy Group determine our total Savings?
Total savings are determined by adding your Energy and anticipated maintenance Savings. We have discussed how your energy savings are calculated. Now we add your maintenance savings. Before we go any forward let me throw out a huge disclaimer. No one knows what their maintenance savings are. No two companies calculate their maintenance savings the same way. Some companies even tell us they will have little savings since they pay someone to maintain their equipment all the time and if that person had less to do they wouldn’t see any benefit. With that said let me explain how The First Energy Group looks at maintenance savings. If you think our estimates in error feel free to substitute whatever numbers you feel are correct. We are not claiming this number to be correct. There is no such thing as correct – it is only an estimate that we throw out.
New equipment costs less to maintain than aging equipment. Today’s modern components are designed to last longer and perform better than ever before. The maintenance costs that we attempt to estimate include:
- The time, effort, and cost to report a problem, schedule and do the repair or replacement.
- The cost to order, receive, store and retrieve products.
- The cost to process and pay bills.
We have considered the above costs and assigned an estimated maintenance cost to your existing facility. We know it is not your cost. However, we tend to have as many people think our estimates are low as we do who think they are high. After considering the above items, if you want to plug different maintenance costs into our projections feel free to do so.
Once again, we conservatively ignore your “unknowable” costs such as lost productivity, accidents or errors that occur in poorly lighted or maintained areas. Nor have we considered any morale issues due to existing poorly lit areas or an uncomfortable working environment. As always these potentially large “soft” costs are totally ignored. Any “soft” benefits you gain are above and beyond what you can easily see.
