Energy matters #4: Hire a contractor … or DIY?

March 15, 2012
Written by Chris Hanlon
When projects seems daunting

Our previous articles have focused on analysis and planning for energy conservation and efficiency improvements. By now you have selected your energy champion, benchmarked your current status, and created a plan that fits your business needs. You have addressed the “easy fixes,” and now a decision will need to be made to proceed with larger initiatives that require increased capital investment.

Obtain either a purchase order or a formal contract.
Make contractor responsible for permits.
When you have a larger project to take on, the first question is . . . should you act as general contractor or outsource? Individual situations vary. We find that growers are very creative and independent people, but they sometimes tend to undervalue their own time or that of their employees. The assumption is that it will be more cost effective to do things in-house. This is certainly the case if your operation is seasonal, not running at full capacity, or if there are large blocks of free time available in your organization.

But, if you are taking time from regular duties, a do-it-yourself strategy may end up being the more expensive option in terms of lower productivity in your core business.

TAKING THE TIME TO CONDUCT SERIOUS RESEARCH
Acting as general contractor is a start-to-finish commitment. It’s more than just sourcing options, obtaining quotes and placing orders. The role requires you have time to do some serious research to ensure all parts of the job fit together. This includes making sure the right contractors are involved and that multiple contractors are properly coordinated. On large projects, surprises are not welcome. Lack of research means you run the risk of missing important details or leaving rebate and incentive money on the table. This could result in installation delays, longer paybacks and a more costly project.

Whether you outsource the job or do it yourself, make sure that your project management includes:
• Obtaining required permits and/or assessments.
• Applying for all available rebates or incentives.
• Hiring contractors.
• Preparing an installation schedule that suits your needs.
• Site visits.
• Contractor management.
• Commissioning.
• Verification of work.  
• Certificates.
• Guarantees.

Each one of the above issues could be a column by itself. A few thoughts on the key points are:
Contractors: Whether you prefer to work with contractors you already have a relationship with or you prefer to look at alternatives and obtain competitive quotes, make sure you know what you want and expect from the contractor and that your expectations are known. Check out competitors to obtain a comparison for both the work output and price. Doing this may provide new insights or information on products or services.

THE IMPORTANCE OF A SCHEDULE AND A CONTRACT
Schedules and contract management: Make sure you obtain a schedule and a contract of some form – either a purchase order or a formal contract. These documents should describe the work, the details of time required for installation, completion dates, who will be on site, their qualifications to perform the work, and costs (both fixed costs and how the contractor will deal with extras). Make sure your project manager conducts both scheduled and random checks on the status of the work.

Permits and guarantees: When work requires verification, have it checked and signed off because there is nothing worse than having an inspector show up after the fact to shut down a job or make contractors take three steps back. Don’t forget to determine who is responsible for permits – you or the contractor. Our preference is for the contractor to be responsible for permits as they can build the inspections into their work schedule.

Commissioning: This is the process a contractor will conduct to ensure equipment is working properly. Even for simple jobs, a commissioning plan should exist; it should include an outline of testing that will be performed. If your contractor cannot provide one, think twice.

GET ALL GUARANTEES AND WARRANTIES IN WRITING
Guarantees or warranties: You must get them in writing. The project manager or contractor should identify if the guarantee is their own or that of the equipment manufacturer. The guarantee should also indicate what work is covered, how to obtain service and who will provide it, and if there is a cost for service calls.

Initiating conservation and efficiency measures, whether through operational changes or upgrading your facilities, can result in considerable cost savings. Some projects may seem daunting because of their scope but they can be very manageable with proper planning and the right people working with you. Once you have done all you can to make your operation energy efficient, you can consider taking it a step beyond, perhaps through on-site energy generation for your own use or as an additional revenue stream.

Next time, we will discuss a renewable option with emphasis on the importance of research, knowing the availability of rebates and ensuring proper project sizing.

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