Selling the Owner on the Strategic Advantage of Life-Cycle Design

The phrase "robbing Peter to pay Paul" describes what typically occurs during the programming phase of the collaborative design process on a large project. This can certainly be the case when a critical mechanical, electrical or plumbing system is scaled back or even eliminated. Unfortunately, mechanical systems are frequently the first to undergo cuts when a project swells over budget.

By Jack Putnam, P.E., Manager of M/E/P Services, Woolpert LLP, Dayton, Ohio and Bret Paden, P.E., Manager of M/E/P Services, Woolpert LLP, St. Louis November 1, 2003

The phrase “robbing Peter to pay Paul” describes what typically occurs during the programming phase of the collaborative design process on a large project. This can certainly be the case when a critical mechanical, electrical or plumbing system is scaled back or even eliminated.

Unfortunately, mechanical systems are frequently the first to undergo cuts when a project swells over budget. Out of public sight, big-ticket items such as HVAC units, boilers and chillers make easy targets for those who are trying to trim the balance sheet.

In reality, it is usually in the owner’s best interest to analyze true life-cycle costs and closely examine the costly repercussions of shortsighted M/E/P design. It’s up to the system designers to do the job of selling the owner on the benefits of looking beyond initial costs and considering life-cycle costs. Clients need to know that if they are going to focus on initial savings, they may actually be spending more money over the long haul.

Failure to choose the most efficient method at the outset of a project may have an exponentially detrimental effect that lasts far beyond the project, stretching 30 years or more over the life of the facility.

During our years of working with public and private clients, our team of architects and engineers has identified four keys to success during the programming phase of project design. These are strategies to help one’s clients avoid being pennywise and pound-foolish. These strategies are presented here through a series of project case studies in which they were implemented.

Energy efficiency

The first of these project stories concerns the Dayton (Ohio) Public School District, which recently launched a massive construction project that will eventually involve approximately 35 new school buildings over the next 10 years. The school district wanted a mechanical system that would use ice storage. During the initial budget analysis, the ice storage system was considered too expensive. But a life-cycle analysis indicated that the alternative was a system that would ultimately cost the district hundreds of thousands of dollars more per year in utility costs over the years.

A detailed assessment determined that an ice storage system that provides cooling in conjunction with the chiller would permit the district to purchase a smaller, more energy-efficient chiller. The smaller unit could potentially achieve approximately 125 kW in electrical demand savings. Excellent efficiency, in turn, could launch a domino effect that would cascade beneficially in many directions. This would enable the engineers to optimize all system components for a further increase in savings.

For example, colder air could be utilized, which would allow the engineers to reduce the amount of supply air and ductwork and the size of air-handling equipment. Colder chilled water could reduce the size of the piping, and thus, of the pump to circulate it. And, of course, smaller components working more efficiently reduce electrical consumption. Multiply these solutions by the life of the system and by 35 school facilities, and the sum is substantial.

The lesson for owners is that the price of energy efficiency often entails higher costs up front but lower costs in the long run. And losses are often recouped within three or four years. For example, a building operator may invest $25,000 more on the bid date, but due to increased efficiencies, may save $8,000 to $10,000 per year in operating costs—perhaps over the span of 30 years. But energy costs are, by no means, the only considerations in a building life-cycle costs. There are other issues, such as adequate equipment space, that will indirectly affect efficiency and have a direct impact on other costs.

Adequate equipment space

Another key to selling the owner on long-term life-cycle cost savings is the critical need for adequate interstitial space. Saving two rows of brick by making a building six inches shorter may seem like a substantial value at first, but in the long run, it may prove to be no savings at all. Rather than being forced to incorporate bends and offsets, an additional six inches of space may allow mechanical and electrical contractors to make a straight shot with the miles of ductwork, wiring and piping that go into a large facility. Offsetting ductwork, conduits and pipes up and down makes for a noisier system, and the system may experience pressure loss and degraded efficiency throughout. For example, offsetting an 8-in. pipe over an obstruction and back down can add $700 to $900 for each occurrence. Saving two rows of brick may be offset by costs due to substantially increased coordination issues among the subcontractors, not to mention the increased operating costs over the building’s life.

Adequate size of a mechanical room is also vital to efficiency. Proper maintenance of equipment is directly correlated to the space allowed for servicing that equipment. For instance, air filters can be topped with caked-on dirt because they haven’t been changed in years. As a result, efficiency and longevity of equipment will certainly be compromised. Air handlers that should last 40 or 50 years may need to be replaced prematurely because coils can’t be cleaned properly. Again, money saved on initial construction might not translate into long-term savings. Ease of system maintenance should be given strong consideration during design.

Future flexibility and expansion

There is another important space issue. Every project needs to consider how much spare capacity should be allotted to accommodate inevitable change, which seems to evolve at a more rapid pace each year. Not an exact science, it entails a best-estimate approach. First, 25% spare capacity in all systems is a rule of thumb. Next, each component may be taken on a case-by-case basis—by weighing options and making an educated decision based on the whole picture, not just on bottom-line dollars. For example, in a northern school, a boiler is critical in wintertime. This may call for the redundancy of two boilers, each sized to greater than half capacity. Each boiler might be sized for 70% of total building load, so the duo provides the facility with a 140% potential capacity. This additional capacity for the future should also be considered in the design of the distribution systems.

Programming phase

Beyond the immediate issue of space, an A/E designer needs to carefully define the project’s scope, not merely develop an itemized list and simply begin to design. A well-thought-out scope analyzes interrelationships of systems, prioritizes items and ensures proper phasing, sometimes over a period of several years. Not doing so can be problematic, particularly in circumstances where the cost of system components exceeds the client’s overall budget. This was the case in a project involving the Montgomery County Common Pleas Courts Building in Ohio. Good programming overcame the budget shortfall by dividing the project—which began in 1999 and will continue into 2004—into three phases. The scope outlined a logical sequence to implement all of the county’s desires for the facility. All items on the wish list were analyzed and prioritized to make the most cost-effective decisions. Items that could be implemented to make the greatest impact were the first priority. Installing a 175-ton chiller to take care of an air conditioning system shortfall was determined to be the top priority, followed by installing a new DDC system and giving that system control of the building’s central plant equipment. The DDC system commenced with the four main air-handling units and then, eventually, progressed to the building’s variable-air-volume units in future phases. Proper planning not only gave the facility managers an initially successful project, but also a road map by which to plan for future projects and budgets.

An upgrade of the electrical system at the state fairgrounds in DuQuoin, Ill., is another example of taking a long-term approach. In this case, engineers first reviewed the existing conditions and, through several meetings with the owner, developed a detailed scope of work. Essentially a master blueprint of the entire upgrade, the scope was divided into four phases to accommodate funding spread out over four years. As a result, work could be completed systematically, and it gave the owner the most value for the money as it was spent. A further benefit: It allowed the owner to coordinate the electrical system upgrade with other projects that were planned or already underway at the fairgrounds. The result was a more efficient system that avoided the need for repeated reworkings as each phase or additional project was constructed.

The best-laid plans…

Time and again, big-ticket items in M/E/P systems are the ones that owners first look to cut, despite what may prove, end the end, to be long-term deficiencies. Once the M/E/P infrastructure is in place, however, there’s no turning back. Even if a chiller were later upgraded, without the proper support system in place, it will never take full advantage of the chiller’s energy efficiency.

Wood trim, wallpaper or other finishes can be added or changed significantly, but major systems may be irreconcilably ensconced. In any marketing effort, this is the main point that designers must impress upon the owners.

In short, designers must convince owners that the real dollars are in long-term operating costs, not first-time equipment costs. Look beyond the easiest target.

Keep the Candidates Coming

Engineering firms are discovering that it’s not always easy to find qualified job candidates to fill an immediate need. So why not recycle resumes to increase the number of potential candidates? This is precisely what one consultant suggests.

“Design and construction firms often have a goldmine of resumes from job candidates who didn’t fit the current opening, but may be a perfect fit for a position in the near future,” says Sarita Peng, an associate and recruiting consultant with Natick, Mass.-based ZweigWhite. “Recycling old resumes from past candidates or those who have shown an interest in working for the firm can increase the firm’s ability to make crucial hires quickly.” Peng has other advice for maintaining a ready pool of candidates:

Create a database. “A simple way to electronically file resumes is to create a resume folder that is subdivided by candidates’ location and discipline,” advises Peng. “Whether you organize resumes by city, state or expertise, build a custom filing system that best suits the firm. It is well worth the time and effort.”

Maintain contact with good prospects. “Firms should flag top-priority candidates in their electronic resume filing system and keep in touch with them. Consistent and personal follow-ups keep the hiring firm front-and-center in the minds of candidates, especially if a candidate’s situation changes and he or she is ready for a change in work environment,” says Peng.

Don’t burn bridges. “It’s important to handle all potential candidates and position inquiries with courtesy and respect, since they may become prospects in the future. Take time to put closure to the recruiting process for candidates who may not have worked out,” concludes Peng.