|“The system will sell itself as long as you have the right information and knowledge up front,” said Travis Smith, president, Sky Heating & Air, Portland, Oregon.|
HVAC contractors selling renewable energy technologies often find themselves running into one common roadblock once they’re in front of homeowners: cost.
Although renewable energy solutions generally boast a great return on investment, finding the right customer often plays a big role in making a sale.
“It really comes down to what the customer is looking for,” said Travis Smith, president, Sky Heating & Air, Portland, Oregon. “I usually ask them to look ahead and ask which of their friends has an oil rig in their backyard, because I don’t know of anyone who can generate their own fossil fuel energy. But, when it comes to electricity, I know a lot of people who have solar panels and a few who have wind turbines. Going forward, there’s going to be a lot more ways to generate residential heating and cooling energy than just fossil fuels, which are a dying breed.”
Smith, who also doubles as the geothermal salesman for Sky, is constantly battling a strong natural gas company in his area, who he says advertises more than the electric and heat pump companies combined.
Still, with the Pacific Northwest being known for its green affinity, Smith faces a double-edged sword: People want geothermal, but most aren’t willing to front the steep initial cost.
“Oregon and Washington are a little bit of a different animal,” Smith said. “They are very, very green. You’ll probably see more Priuses and Teslas here than any part of the country. We get people to buy 20-SEER air conditioners for two months out of the year because they want to do something good for the environment. I know a lot of other parts of the country are not as green and environmentally friendly as we are. Fortunately, we don’t get a whole lot of pushback on the technology, but the up-front price continues to be an issue. The people using propane will see $3,000-$4,000 a year savings.”
Smith said because of ridiculous drilling prices due to the salt in the area, an installation that might go for $13,000 in the Midwest is priced at a minimum of $20,000 in Oregon.
“We have to be financially savvy and tell them they can expect a 26 percent return on investment year after year, and they’ll be more comfortable with fewer breakdowns and headaches,” Smith said.
Jeff Bolton, president, J.R. Bolton Services, Buford, Georgia, said he’s incorporated his geothermal offerings with building science.
“It doesn’t make sense from an efficiency standpoint to put a geothermal system in a home that’s leaking like a sieve,” he said.
Bolton has fully committed to offering geothermal, going so far as to have a different website for his geothermal offerings. He’s made use of his phone system’s hold message as a pitch for the company’s geothermal offerings.
“If they call about geothermal, they pretty much understand it’s the most energy-efficient heating and cooling system available,” Bolton said. “It seems like the people who call about geothermal are sold already, they understand it, and they’re people who are very concerned about the environment and want to do their part. The cost difference between a conventional system and a geothermal system doesn’t seem to bother them that much.”
Renewable and energy-efficient equipment isn’t just exclusive to the residential market, however.
At Crockett Facilities Services, Bowie, Maryland, the company is used to having to incorporate the best strategies available in a highly competitive market in and around our nation’s capital.
That’s why president Mark Crockett has made sure the company has a strategy in place for providing customers with the best options. Crockett offers customers a full report that provides financial information, financing options, and applicable rebate programs, which aids them in making their decisions.
“We’re always competing with some other portion of the owner’s portfolio for money,” Crockett said. “A lot of this sounds good on paper, but when the rubber hits the road, when the energy bill comes in every month, that’s when the concerns become real. We have to do measurement and verification so that if we say this thing is going to save $10,000 a year, we have to follow through with our promises. We’re constantly benchmarking and managing after energy-efficient strategies are employed. It’s really the only way you can tell.”
Not only that, but building owners have become more conscious of saving energy because potential tenants are now demanding it before signing a lease for space.
“You can’t run a Class A office building without some sort of Energy Star rating or LEED [Leadership in Energy and Environmental Design] rating,” Crockett said. “Companies want to know they are choosing a good energy partner when they rent their space.”
On the residential side, Smith said he gets more referrals from his geothermal customers than any others because those are his happiest customers. He said contractors looking to get into renewable energy definitely need to speak with contractors who have done it first.
“You need to get that education so you and your technicians don’t make a mess out of it,” Smith said. “The system will sell itself as long as you have the right information and right knowledge upfront.”
On the other hand, Bolton has begun slowly branching out. He’s recently quoted jobs involving solar panels and also solar-powered HVAC units. “We’re kind of tip-toeing into it, testing the market a little bit,” he said.
Crockett said he thinks selling renewable energy is a little easier in the residential market because it is a product-driven strategy. “As opposed to a commercial office building, where there’s many, many mechanical systems working together, there has to be a strategy for them; it’s not product driven, in my opinion. Both markets have their challenges, but I think ours is a little more challenging. That being said, the upside and reward is grander — you save more energy and create larger and better business opportunities for your company.”
Publication date: 9/1/2014