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Author: Brett Knox
September 12, 2024 - 5 MIN. READ
Sustainable energy solutions are transforming modern homes and businesses. For HVAC contractors, a growing opportunity exists to capitalize on these trends. The traditional model of one-off projects continues but innovative contractors have been enhancing their offerings by including energy management contracts and subscription revenue.
Building electrification presents a golden opportunity for forward-thinking HVAC contractors. From energy audits to IoT (Internet of Things) integration or predictive maintenance, the possibilities are endless. It's time to evaluate your business model and secure your place in the electrified future of buildings.
Exploring New Contracts and Services
More than a third of the energy used in buildings currently comes from electricity. Experts estimate that this percentage could exceed 70% by 2050, representing a significant investment in building electrification.
This trend is creating opportunities for HVAC contractors, as there is a demand for new contracts and services.
Consistent Monitoring and Optimization
The building of the future will be electrified and rely on the latest technology for energy monitoring and optimization.
HVAC contractors can provide in-depth energy audits to organizations exploring energy management options. These recurring audits can identify energy-efficient improvements and other opportunities to support ESG (environmental, social, governance) goals. As more businesses look for concrete ways to gather quality ESG data, the demand for energy audits will likely rise.
The IoT is also creating opportunities for HVAC contractors, and smart devices can measure energy usage in real-time for monitoring purposes or interact with smart power management systems to adjust power consumption. Solutions include smart sensors that can track changes in energy consumption, occupancy, temperature, humidity, air quality, and more.
Designing and installing these smart systems will help you establish your business in the smart building market, which could grow at an annual rate of more than 10%.
Predictive and Preventative Maintenance
Besides implementing a remote monitoring process, you can support building electrification goals by scheduling regular maintenance calls or relying on IoT data to inform you when maintenance is needed. Being proactive about scheduled maintenance will help optimize energy consumption, extend the lifespan of the equipment used, and maximize energy savings for your customers.
Energy-Efficient Upgrades
What will the building of the future look like? The current trend is to combine multiple technologies to create highly customized solutions that drive profits. These include renewable energy generation with solar panels, storage capabilities with batteries, and energy-efficient solutions such as heat pump technologies.
Other popular upgrades include LED (light emitting diode) lighting, EV (electric vehicle) charging, retrofitting, security systems, IoT sensors, and more. These energy-efficient technologies often require upgrades to the building’s electrical infrastructure, including installing a new panel or replacing old wiring. If you don’t have in-house electricians, this is a great opportunity for you to partner with electrical contractors so you can expand your offerings without incurring fixed costs.
Most organizations will roll out these technologies progressively, creating long-term opportunities for contractors who position themselves as electrification solution providers. You can adopt this role by developing continuous improvement plans that account for changing needs and goals.
Total Cost of Ownership, Cost Savings, and Rebates
Organizations invest in building electrification to cut energy costs and expect measurable results.
As a trusted advisor, you can guide commercial customers toward a building electrification strategy that reduces costs and creates opportunities for future savings. Start by identifying rebates and incentives, such as energy-efficient commercial building tax deductions.
You can also set energy consumption goals to help reduce energy bills. Commercial buildings use an estimated 17% of the electricity produced in the US, so reducing this number with energy-efficient upgrades translates into significant savings and lower Total Cost of Ownership (TCO).
How Energy Management Contracts Benefit HVAC Contractors
Adopting a business model that prioritizes energy management and electrification contracts will open up new opportunities.
Long-Term Relationships
Rather than focusing on equipment replacement projects, service, and maintenance, offering energy management contracts provides you with another solution for building long-term relationships with your customers and become a trusted advisor.
This relationship will bring you closer to your customers and help you achieve alignment with their goals and expectations. You can expect increased satisfaction and will likely see referrals go up!
Diversified Revenue Streams
Offering energy management contracts results in a different revenue strategy. These contracts translate into recurring fees that you can collect monthly or annually without incurring the costs associated with acquiring new customers.
Establishing long-term relationships with customers also creates opportunities for upselling and revenue generation on diversified services like emergency repairs, electrical system upgrades, system design, or specialized consulting.
Becoming an Industry Leader
Embracing the energy management market will set your contracting business apart as an electrification leader. From a financial point of view, it will give you opportunities to connect with customers who have a long-term interest in energy-efficient upgrades, resulting in recurring fees, steady work, and an improved bottom line.
In addition, working on energy-efficient projects can give your mission more meaning and help attract talent and customers who share similar values.
Energy management contracts offer your customers cost savings, progress toward ESG goals, and future-proof buildings.
Strengthen Your Procurement Process for an Electrification-First Business Model
The shift toward building electrification presents a transformative opportunity for HVAC contractors. By embracing energy management contracts and focusing on new services like energy audits, IoT integration, smart devices, and renewable energy, contractors can position themselves as long-term partners who support ESG goals and lower TCO for buildings.
As you work to establish yourself as a long-term electrification partner, Raiven can help you secure HVAC, electrification and electrical equipment at advantageous prices.
Gain access to pre-negotiated discounts of 7%-30% from industry-leading manufacturers and distributors, including Alpscontrols, Carrier, ChargePoint, Ferguson, Grainger, Graybar, HD Supply, Home Depot, Lowe’s, Office Depot, Sunbelt Rentals, Schneider Electric, United Rentals, and more!
Discover the benefits of participating in a premier purchasing program like Raiven. By leveraging the collective buying power of its members, Raiven secures exclusive discounts on automation controls, HVAC equipment, breaker panels, conduit, EV charging stations, load shedding, tools, lighting, wire, and more. And there’s no more negotiating with individual suppliers.
Raiven is committed to supporting HVAC contractors by providing unbeatable prices on equipment, parts, and maintenance supplies. Experience the convenience of our streamlined purchasing platform for quick and efficient procurement. Other key benefits:
Raiven is your go-to partner for positioning your business as an electrification leader. Visit Raiven to learn more about building a procurement process that gives you a significant advantage.
