90% of all my new energy audit customers now expect reduced or 'free' service. BPI has sites listing participating contractors who offer free audits. BPI has advertised rates of $250 for a whole house assement and audit.
As a professional who has been in the construction business since 1972; I feel this is an attack on the industry from administrators who are micro mannaging the industry. A blower door with all diagnostic equipment now costs around $6,000. Level 1 IR training and a 120 x 120 pixel IR camera, (one that meets the anticipated RESNET standards0, is approaching another $10,000. Add insurance, advertising and overhead; the $250 audit fee is a major income loss.
Perhaps the audit/sales/install business is what is pushing out the independent auditors. That spells loss of competiton and more expense for the home owner. Handy men and home owners who want to do their own retrofits will be out in the cold.
As with any government run enterprise; This business is going to be over influenced, controlled and limited to the big players at the independents and consumers expense.
This is an often discussed topic and one for which I have a good answer, we need to be more professional. First, understand that there is no such thing as a free audit, somebody is paying for whatever services are provided. A well educated customer, and education is a major part of our job, will recognize that these full service companies are just shifting the cost from the audit to the retrofit.
When you play with the retrofit numbers you realize we need to be improving homes at about 10X the current pace. One, people just aren't motivated to make improvements and two, (get this) the government needs to create more jobs, yes, we are a big part of the jobs program. And THREE, we can call this the "home owner financed stimulus program". It's a case that "home owner equity" is simply too much money not in circulation and circulating money is what drives our economy. So the win/win/win/win for our government, the economy, the home owners, and global warming is, by whatever means, push those home owners to make improvements and spend some of their nested equity, and in the end, reap all of the related benefits. We can hate all of this, but the irony is, it's all good.
Now, staying in business when you are up against what they call "the stake holders" or big players, is not all that difficult. If you have read the guidelines for the new SCORE program being promoted by DOE and LBL, it is a joke (sorry but true) and extremely easy to work against. You see the big players just want to get in and get out and shake down the home owners for as much as they can as fast as they can. You and I are building a long term business where we want to establish a relationship with our customers, you know, because we care.
This government takeover of the energy efficiency business doesn't make our job as easy as we would have wanted, but it is still one of the best opportunities available. IMO, we each need to invest 30% of our time into education. Polish your communications and put yourself on the road talking to anyone and everyone you can. Don't exactly slam the competition, but be sure your audience understands the importance of taking the time to do an audit right. Remember, you are there to discover what improvements will work best for them, not just sell a bunch of improvements because that's what your company thinks everyone needs.
My prediction, having competition that is bad, is good for business.
Great reply, I learned from it.
You bring up very good points about all of the expenses that we encounter and the need to recouperate them. The fact is that if we do our job correctly, and work gets done to save energy, someone is saving money, and they need to pay their part. Auditors who just sell reports to folks who don't get work done aren't doing anyone any good. Follow through is the key to making sure energy gets saved as a result of the audit, and the people benefiting are happy to pay what it is worth.
Educating your customer is key to long term success and a relationship with your customer for most businesses. My perspective as a newbie to this industry, but very experienced as a contractor is, when the Energy Auditor establishes himself/herself as the trusted advisor/consultant, they are right where they want to be. Working as a roofing contractor I was often able to establish myself as the trusted advisor. It would often mean they would use my roof proposal as the job specification to order more bids from other contractors. Yes, I was not getting paid to write the job specification. Nor did I get every job that I bid. But, by establishing myself as the trusted advisor I did close more roofing projects than most and built long term business relationships.
Regarding providing the Energy Audit without being a contractor as well. As the trusted advisor you supplied the now well educated property owner with an unbiased Energy Audit/Job Spec. I would think that the property owner is now in a much better position to get bids on energy upgrades and get the most value for their investment. Instead of getting caught up in a large company’s one call close process. One call closes usually work out much better for the contractor than the property owner. Even as the property owner may have had to pay you several hundred dollars more for an unbiased audit, they now have the knowledge and power to get competitive bids. The ability to compare apples to apples and probable save thousands on the upgrades. Spend a couple hundred more now to save a couple thousand in a few months and potentially thousands more over the life of the energy saving improvements. Hmmm…. For the thinking individual that should be an easy choice.
Look at other ways to make your business profitable. Line up contractors that will pay a referral fee. Business pay a lot of money to advertise to get a customer. What does it cost them for each customer. There is also value to the customer as they dont have to search for contractors who will do the job right.
Our local utility has a policy that theycannot refer any contractors to a homeowner. They hand the audit results and recommended upgrades to the homeowner. How often do you think the owner doesnt follow through or they find a contractor that doesnt do the work correctly,etc.
I see homeowners call contractors and getting bid for what the contractor recommends. I was at another site and the owner is seeking advice, he was in DFW and had a big 2 story home. His problem was keeping the 2nd floor cool. He radiant barriers contractors, roofers (venting) and insulationcontractors out giving him bids. The home had some cathedral ceilings on the 2nd floor and ducts in the attic. He was trying to sort out all the conflicting information. Wouldnt it have been better for an auditor to work with him and help him get the right contractors in to do things correctly.
I see no problem with this business model. I think in the end you can get the homeowner the resluts they deserve at a fair price.
About the facet you bring up, free energy audits might impede alot of would be
energy auditors--- This solution served me well - becoming a LIGHTING AUDITOR-
would this work for everyone- no , however I took my twin concerns- Logical energy
use and the LOVE of quality LED lighting and started
specializing in just lighting audits. There is very little competition for doing this
subset of energy audits. The problem identification process and the ability to provide
LED lighting solutions has been both lucrative and fulfilling + very gratifying. Also
since millions if not Billions of lights will be changed out in short time the
task of need identification is great. The challenge would be to have a good
grasp on lighting principals, have good analytical skills, have very good diagnostic
tools -AND to be able to speak to LED performance issues- as well as knowing
about other types of lighting and where those are appropriate. The point I would make
is that there are options and facets to energy auditing - I encourage erstwhile
energy auditors to add to their "energy auditing skill sets" by looking in to becoming
a lighting auditor . Again as I see it there are few concerned with identifying the
kWh waste regarding lighting- few Energy auditors even address energy waste in lighting
so the market is ripe for those inclined to explore it- My advice gain acumen in this
area of energy use assessment, differentiate your biz by having abilities to define
lighting needs and by having knowlege about the role of solid state lighting. I bet it's
an option few would think to explore and excel at. Consider it !
Any audit should be independant of the contractor - period (this is not to cast doubts on the contractor in any way, shape or form).
In a sense this is an essential part and parcel of the very notion of an audit.
Just because it's a home energy audit doesn't or shouln't make it any different.
It's ok if the contractor wants do do an audit for his own purposes in accomplishing his weatherization or building work.
It just ain't a real audit in any sense of the word if it isn't entirely independant.
Hi Randy, it's called jobs creation and we can't really blame someone for jumping into one of the hottest business sectors available. If customers can't tell the difference between this newbie and you, that's not his fault. Your web page should be documenting that experience and listing the half a dozen certifications you have received since the first. It's like the old Will Rogers quote "Even if you are on the right track, you'll get run over if you just sit there."
There's no doubt this is a tough business to be in and difficult for many to make a living, but so are many professions in these times. Do you really think this 6 day wonder is going to be making $50,000 a year? I don't, but if he does, I want to know how. Remember, he was a car salesman and half of what we do is selling.
Get your foot back onto the gas pedal and maintain that distance between yourself and the competition as he won't be the last one who decides they want to play in our back yard.
Unfortunately, that 6 day wonder is tarnishing everyone's reputation and confidence in what we do. If we are to be an "industry" we must establish standards in terms of knowledge, workmanship and ethics. I have been a green builder for 20 years; my company invests a lot in education, much of it dealing with building science. I just sent an employee to BPI training. While the training seemed to have been intensive enough, it was out of context. I sent this employee with specific technical questions to get answered. Based on the answers that came back, it seemed clear that the instructor probably had very little field experience. It seems that a base knowledge of regional building science and building techniques should be a requirement of both instructor and students. It was difficult to find a class to send an employee to. Some of the better advertised national BPI training programs were clearly sham operations with little knowledge of anything, including business. When I called BPI they were completely unable to be of assistance in helping find a competent trainer. BPI seems to be the standard. The industry (i.e. us) needs to take responsibility to either improve BPI's business and training model or find and promote an alternative.
I agree 100% If you have never built or remodeled a structure in your life you have ZERO EXPERIENCE in Buildings. By the way I have just finished a 6 day course in plastic surgery anybody want to be my first customer? I can show you a piece of paper with my diploma
Become a proctor to pass on your gained knowledge and improve the curriculum---if anything, earn extra income from the "certification puppy milling". Knowledge is the seed that sprouts wisdom, but, nothing grows if knowledge isn't shared.