The status quo process for identifying and building an onsite renewable energy project is not designed for speed, scale or efficiency. To put things in perspective, 55% of the total price of a renewable energy project is non-hardware-related soft costs.
- Understanding the financial and environmental opportunity of installing renewable energy across a portfolio is often laborious.
- Coming to a consensus as an organization on what your internal goals are (financial ROI versus direct emissions reduction) can be difficult.
- Finding a provider that is a good fit for your projects via a competitive process can take a lot of preliminary research and coordination.
- Comparing project bids submitted by providers is hard and requires a moderate level of technical expertise to level set and evaluate.
🚄 How to swiftly deploy renewables across your portfolio
Through years of helping clean energy buyers accelerate their procurement processes, our team has identified these three key phases of the process that make or break an organization's ability to act quickly and confidently to get clean energy projects done. The keys to efficiently getting a successful renewable energy project done are:
- Identify and start with projects that have the best-estimated ROI.
- Collect your project bids via a competitive bidding process.
- Select a qualified Provider that will deliver on their bid.
📊 Identify the best buildings in your portfolio
What your portfolio analysis should include
- Comprehensive, but not exhaustive, analysis of all of your locations based on your goals.
- Estimated project costs and available financing options so that you can engage stakeholders early to shortlist options that fit your business goals.
- How much you’ll stand to save in energy costs over the lifetime of the project(s).
- Which renewable energy systems your buildings are compatible with.
- A way to sort and rank your buildings by their financial and decarbonization potential.
Mistakes you should avoid
- Trying to model the value of clean energy with 100% accuracy before going out for bids.
- Not engaging the necessary stakeholders at your organization (CFO, Procurement, Sustainability, Building Operations) at the beginning of the process to confirm goals and understand the project approval process.
- Taking so long to get to the bidding process your data becomes outdated.
Key takeaway
Getting to an attractive shortlist of projects as quickly as possible enables you to go to market and get bids so that you can have more substantial internal conversations based on market data.
🥇 Collect project bids via a competitive process
What your competitive process should include
- A trackable and accessible process that shows bidding steps and deadlines, so that the bidding process is clear to providers.
- Publishing your specific needs and project desires to providers so the bids you receive are reliable.
- A clear way for you and bidding providers to ask questions and get timely answers.
- An easy way for providers to submit a bid.
- A large qualified pool of providers to solicit bids from, improves your chance of getting the best pricing.
Mistakes you should avoid
- Sole sourcing is tempting because it seems easier, but it reduces your chance of getting the best price and a representation of local and national providers.
- Not providing all of the site details or asking the questions that are critical to getting a reliable price.
- Not getting a letter of support from the provider to verify the bid price.
Key takeaway
Introducing a thorough and competitive bidding process will increase the quality and reduce the price of your projects. In 2022, the average price delta between the lowest and highest bid on renewable energy projects sourced in Station A’s marketplace was 66%.
⚖️ Evaluate your bids on a level playing field
What your bid evaluation should include
- A true apples-to-apples comparison of project bids.
- The safety and project track record for each provider.
- Comprehensive design packages, project costs, and timelines.
- Reference checks for providers.
- Policy changes that could affect the viability and timeline of your project.
Mistakes you should avoid
- Not vetting the Provider's track record for things like the number of change orders and pricing.
- Not unpacking an offer that is exceptionally low or non-conforming to bid requests.
- Automatically going with what looks like the lowest price.
- Not knowing how to scrutinize multiple offers with different configurations, equipment and build timelines.
- Not leveling all bids with the same assumptions.
Takeaway
The lowest price is not always the best offer, make sure your bidding process allows you to evaluate your bids on multiple levels to avoid the future pain of change orders, price increases and project delays.
🪜 How to get started
💰 How to pay for it
👋 Station A can help
Request a Portfolio Review at stationa.com. Your portfolio review will include a report with the clean energy technology and financing options available at each building address. Then, take your best projects to our marketplace to collect competitive bids from vetted providers.
