September 15, 2016

One Project, Several Benefits

Hospital building managers face multiple challenges and priorities: aging equipment, older buildings, patient comfort requirements, and strict hospital standards. Not only do hospitals run 24/7, but demand is growing due to an aging population. A hospital’s operational challenges are interrelated, and solutions to overcome them should be comprehensive: one project, several benefits.

In this context, Integrated Energy Performance Contracting (IEPC) projects are advantageous. IEPC projects take a deep, whole-building approach to upgrading and optimizing electromechanical systems. Project performance is contractually guaranteed, including the project costs, energy savings, and third-party subsidies.

A new IEPC project is being implemented at Hôpital Saint-François d’Assise (HSFA), a hospital in Quebec City. “It’s a multifaceted project,” explains Patrick Ouellet, an engineer and the assistant director of technical services at the CHU de Québec (Quebec City University Hospital Center), which consists of five hospitals. “We’re saving energy, we’re upgrading key equipment and systems, and we’re resolving comfort issues.” HSFA is the fourth hospital in the network to be upgraded with an IEPC project, and collectively the projects have guaranteed savings of $3.7M per year.

“Ultimately, this project is costing us less than a traditional project that addresses only equipment replacement or basic upgrades without added value.” – Patrick Ouellet, assistant director of technical services at the CHU de Québec.

Maximizing results

In a facility in which patient care is the primary mission, energy efficiency brings added value, but it is not the number one priority. However, Ouellet regularly assesses which projects will bring the greatest benefits for the hospital when planning construction projects and upgrades to the building’s extensive electromechanical systems.

“Companies with an IEPC approach develop projects that address the entire building. Each piece of equipment is part of an overarching design,” explains Ouellet. Nothing is done with a piecemeal approach—every modification is approached with the whole in mind in order to maximize results. “Ecosystem, the company in charge of the project, was even able to incorporate some of the hospital’s other work in progress into the IEPC project,” Ouellet noted.

Difficulties with the traditional model

According to Ouellet, it would have been difficult to do such a deep retrofit at HSFA using a traditional contracting model. Not only do traditional models favor the lowest bidder—to the detriment of innovative technologies and higher energy performance—but they also tend to be designed and implemented by different companies working separately in silos. IEPC instead uses an integrated delivery approach, which involves a single company taking full responsibility for the project, from initial design to post-project follow-up. If there is a problem or equipment isn’t running as planned, there is only one company to call. “There aren’t different players trying to shift the responsibility. An IEPC company needs to be in solution mode,” affirms Ouellet. In addition, the selection process favors the project that offers the highest net present value (NPV), which represents the value that a project will generate for the client in the long term.

“With this project, we were also able to get a lot more done, thanks to the way that it’s funded. The project provides an upgrade for the entire building, which we couldn’t have done with our limited capital renewal budget alone,” Ouellet said. As with any project, cost can be the limiting factor. IEPC projects have the advantage that they are funded through guaranteed energy savings and subsidies. As Ouellet points out, “Ultimately, this project is costing us less than a traditional project that addresses only equipment replacement or basic upgrades without added value.”

Less risk

IEPC projects minimize both the financial and technical risks for the client. The results are contractually guaranteed, and to make sure the performance targets are met, “it’s in the company’s best interest to deliver optimal installations,” explains Ouellet, “and it’s also in the client’s best interest.”

What’s more, the guarantee can be long term—10 years in the case of HSFA. This means the IEPC company needs to make smart technical decisions right from the start and also remain fully involved in post-project optimization. During follow-up, the IEPC firm ensures that equipment and systems are continually optimized, properly operated, and running at their peak, in order to meet or beat the guaranteed results, a process that “can even generate additional energy savings”, says Ouellet. “Conversely, with the traditional model, there usually aren’t rigorous monitoring mechanisms in place, and if the savings aren’t reached, it’s the client who bears the consequences.”

Patrick Ouellet(right) with Cedric Bertrand (left), Project Director at Ecosystem.
Patrick and Cedric with David Bonneau (left), Lead Designer of the project.

More collaboration

Collaboration, one of the pillars of IEPC, is a key element for project success. “I know few construction contractors that are as customer-focused as IEPC companies. We’re in this together for the next ten years. Collaboration helps us avoid any missteps,” maintains Ouellet, who manages more than 100 projects each year, including some where collaboration was lacking. “Disputes with contractors usually stem from interpersonal relationships that aren’t well developed, from misunderstandings.”

“Ecosystem has offered exceptional customer service. We work together, and it’s a shared project,” says Ouellet, adding that this approach is win-win. HSFA ensures that the Ecosystem team is able to work efficiently on the worksite, and the Ecosystem team does their best to continually improve project results. “The staff is dynamic, passionate, motivated, and motivating,” he said of Ecosystem.

Good relations and active listening are all the more important for work carried out in a hospital environment, to avoid any critical situations during construction. The well-being of patients, infection prevention, continuous operation of vital equipment… these subjects are all discussed, different risks and scenarios are considered, and major issues are avoided through this ongoing communication process.

Complex but advantageous

Contracts for IEPC projects are more complex than traditional models, which can be a deterrent for some. Ouellet for one believes that “the industry should reflect on this, and simplifying the process is everyone’s responsibility.” Despite this obstacle, he asserts that “implementing this type of project brings real tangible benefits.”

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