program that addresses the worst
problems first, then loops in the
less critical systems.
“Create it as a simple project
with a goal,” Auton recommends.
“If your first goal is ‘All of my
critical equipment has a mainte-
nance program to prevent typi-
cal failures,’ that’s your starting
point. First, you need to know
what equipment is critical. Then
you need to know what are the
typical failure points, and what
maintenance activities should be
occurring and at what frequency
Start with last year’s service
history. Sort all of your repair
calls from the last 12 months by
type of equipment and type of
failure. That will give you an idea
of your facility’s current condi-
tion, Auton says. “That’s where
you get into the 6:1 ratio,” he adds.
“You should be able to perform
six PMs between every repair. If
you’re doing repairs between your
PMs, that tells you your preventive
maintenance isn’t effective.”
If you run into this problem,
figure out why. Is it because you
missed a step in the maintenance
procedure? Are you not doing the
procedure often enough? “I’m
working at a site now where belts
are an issue, and in some cases,
they’re replacing them every three
to four weeks when they should be
lasting a year,” Auton says. “What’s
the problem? The issue is that A,
the techs are not properly chang-
ing the belts, and B, the sheaves
are worn and should be replaced.
You should address that with two
approaches: Make sure the equip-
ment itself is in good working
condition, then do the proper belt
replacement exercise, which is
back the sleds off, make sure the
pulleys are aligned and do the right
Expand this practice over your
whole portfolio by identifying all
equipment in all of your buildings.
Create a registry of all the assets
and equipment that can be main-
tained, then add the baseline con-
dition and criticality of each piece
of equipment, Whittaker says.
“There are certain assets that
may have a higher impact due to
failure. A higher probability of failure increases the impact on operations,” Whittaker adds. “From
there, you look at the condition
and develop an asset health matrix
How to Pay for Projects
You can still make the upgrades and replacements you need even if your budget is low, according to
Scott Pinckard, senior vice president for Prime Capital
Inc. Alternative financing structures are popular with
organizations of all sizes and financial strengths
who need help fitting a retrofit project or equipment
replacement into their budgets.
“Many times, there are different structures that can be
provided,” Pinckard says. “Some are just straightforward
100 percent financing options, but sometimes organiza-
tions find that they can’t incur more debt, don’t want to
put more liabilities on their books or haven’t appropri-
ated funds for upgrades.”
Some of the alternative options include:
• Equipment lease purchase agreement: If you’re
able to take on some additional debt, this straightforward financing strategy may be for you.
• Short-term lease: You pay for the capital expense
over a fixed term, usually less than five years. You can take
the tax incentives for the depreciation, says Dan Dowell,
senior vice president of ABM Industries.
• Vendor financing: The vendor puts up the capital
and the client pays it back over a fixed term.
• Operating leases: The finance company retains
the ownership of your new equipment while you make
lease payments. You can purchase the equipment once
you’ve made enough lease payments, similar to rent-to-
own appliances for residential customers.
• Financing through an agreement: The equipment
and upgrade are included in the payments for an existing service or maintenance agreement. The customer
pays a higher rate for the service to reflect the cost of
the equipment, but doesn’t go into debt.
• “As a Service” agreements: These are available
in several variations, such as Lighting as a Service
or Infrastructure as a Service. Your vendor owns and
maintains your equipment.
• Matching payments: Some contractors will perform
a detailed audit to determine expected energy savings,
then match the customer’s finance payments to the
savings amount so that the project pays for itself.
• Appropriation language: One option popular with
schools and other public entities is appropriating the
annual finance payments for each year one year at
a time, rather than installments on the full amount,
“Look at these projects sooner rather than later,”
Pinckard says. “It’s easy to put off these types of
things and say ‘We’ll do it next year.’ Act now and look