Efficiency businesses consider an uncertain future with COVID-19

Sidelined by virus fears and shelter-in-place orders, efficiency contractors hope to bounce back after the crisis. 

The following story includes reporting from Frank Jossi, Kathiann M. Kowalski, Kari Lydersen, Elizabeth McGowan, Lisa Prevost, David Thill, and Karen Uhlenhuth.

Like workers across the country, energy efficiency professionals are on precarious footing as the coronavirus pandemic unfolds.

Non-essential work has been ordered to stop in many places, unless employees can work from home. In some cases, contracting work is allowed as long as workers can maintain appropriate social distance.

This puts efficiency contractors in a challenging position: Their work isn’t deemed “essential,” and much of it takes place in those now-crowded homes — whether it’s an energy audit, weatherization or installing a new heating and cooling system.

For many, business is drying up with the virus. While some companies are able to continue working on construction projects in unoccupied buildings, that’s not necessarily enough to keep them going. It’s especially worrisome in a potentially faltering economy where residents and businesses have to cut back on spending.

And still, contractors need to make sure their employees are safe and healthy doing work at sites where they could be exposed to the virus.

“Most of our crews don’t even want to come into work right now because they’re afraid they’re going to get sick,” said Stacey Flannery, director of marketing at suburban Chicago-based Eco Tec Insulation. “We’re down to minimal operations.”

As March ends and developments in the United States continue to ramp up, the energy efficiency sector, like so many others, has yet to see the full impact of the outbreak. Businesses have barely had time to assess the current situation, much less plan for the aftermath.

One source of hope for some: Energy efficient technology saves people money in the long term, making it a potentially worthwhile investment when times are tough. So even though things don’t look great now, they may have a chance to improve.

Everyone’s in “Ëœsurvival mode’

Employees across service industries, including energy workers who interact directly with customers, are dealing with looming unemployment. This could be bruising for the efficiency sector, a substantial share of the U.S. energy workforce.

Last year, efficiency contributed the most new jobs of any energy sector, according to a new report from the clean energy think tank Energy Futures Initiative and the National Association of State Energy Officials. Nearly 2.4 million of the 6.8 million energy jobs in 2019 were efficiency-related, the report said. (Energy workers overall make up 4.6% of the U.S. workforce, according to the findings.)

Many contractors specializing in this work run small businesses with 20 or 30 people, often fewer. Some who spoke with the Energy News Network have already laid people off, including Building Energy, which serves northern and central Vermont.

“We’re in the process right now of shutting everything down,” said Andrew Charbonneau, a manager at the company, speaking shortly after Gov. Phil Scott issued a “stay-at-home” order similar to many enacted across the country.

Building Energy offers residential and commercial services like weatherization, as well as solar installation and new construction. The company has about 30 people, and most of their contracts are efficiency-related, Charbonneau said. While he and his coworkers had been working in unoccupied buildings — as employees went home, those buildings emptied out — the governor’s order brought that work to a halt.

“I think every business right now is in survival mode,” Charbonneau said, adding that his team is “actively taking steps right now to secure our future.” While he didn’t say specifically what those steps are, he’s predicting this is the start of a new, albeit unclear, path forward. “I don’t think anything’s ever going to go back to normal.”

Other contractors have been able to keep work going, especially non-residential jobs. This is the case for Dayton, Ohio-based Energy Optimizers, whose main clients are schools. Many school administrators prefer to have construction work done when classes aren’t in session. Now that students are home, the company has been able to get to work on projects that were lined up before the outbreak, said Energy Optimizers’ vice president of business development, Belinda Kenley.

Ohio Gov. Mike DeWine’s stay-at-home directive has an exception for construction. So while Charbonneau had to stop work in Vermont, Kenley was able to keep work going when the order was issued in Ohio. She said crews have their temperatures taken each day and follow distancing guidelines and other public health recommendations when they’re onsite.

“We’re basically doing commercial jobs where there’s no one in the building,” said Eric Kjelshus, who runs a self-named efficiency-focused contracting business in the Kansas City area. Even so, Kjelshus said 80% of his work was canceled in the last two weeks. He’s gone through his client database of 7,000 names to call people who may need work that his team could do under current rules.

In some cases, without strict guidance from government officials, contractors have left it up to their customers. “We abide by their rules when we are in their house,” said Brian Parrish, president and CEO of Richmond, Virginia-based Electrical & Lighting Solutions Inc. The company’s work is split between North Carolina, where all their work has stopped, and Virginia, where some previously lined up projects have been able to move forward.

Hoping to hang on, stay healthy

Parrish said he’s doing what he can to avoid layoffs. Most of the 30 employees at the company work paycheck to paycheck, he said, and he wants to make sure they have income. “When all of this started happening, I gathered them all together and told them what was going on,” he said. “Every week, I give them an update and keep them in the loop.”

Like Kenley, in Ohio, Parrish is monitoring his employees’ health. At a current job in a convalescent home in Williamsburg, Virginia, the crew has a temperature screening onsite each morning.

“So far, knock on wood, all of us are healthy,” he said.

Employee health is top of mind for many business leaders now. The Breathable Home, based in Augusta, Maine, had a six-person work crew. Three of them have had to leave or take time off for health precautions related to the virus, said Nadine Aubuchon, vice president of business operations at the company. A fourth was already scheduled for medical leave.

After closely reviewing Maine Gov. Janet Mills’ executive order — a slightly difficult task given the many stipulations and exceptions — the company’s leaders determined they could continue some work with appropriate safety measures. The crew, now down to two people, is working only on new construction, which means buildings are empty, and they only work on sites where no other contractors are present, Aubuchon said.

Should layoffs be necessary, she said the Breathable Home will cover medical insurance for two months and reevaluate from there.

The outbreak was a sudden roadblock for the company, which was founded shortly before the recession and had its best year in 2019. Like other small businesses, the Breathable Home is now going one step at a time. “It’s not going to be up to us to dictate,” Aubuchon said. “It’s going to be the comfort level of our customers.”

They got a call about a farmhouse renovation, which the owner is hoping to schedule for about two months from now. The company estimator can do an initial “walk-through” by taking measurements over the phone and, if need be, video chat, and give an estimate that way. “Those are the types of things we’re going to have to do,” Aubuchon said. Other contractors have reported switching to virtual assessments and staff trainings as well.

The focus now, Aubuchon said, is to protect employees and to keep going. “That’s the most important thing — is to hang on and make sure we all have jobs after this.”

“If you had told me six months ago that something like this could happen, I would have told you that you were crazy,” said Parrish, in Virginia. “I know I’m getting more gray hair this week, and probably next week.”

Parrish thinks the pandemic could be contained sooner rather than later. But, he added, “maybe that’s just me. I’m very optimistic.” He expects a sluggish second quarter but is hoping for a better third: “Everyone is going to be looking for every dollar they can save.”

Others share that sentiment. They hope that given the potential for efficiency investments to save money for customers, the sector can withstand the blow from the virus. Jobs are at risk now, but “we also are confident once the shelter-in-place rules are lifted that energy efficiency investments will again increase and those jobs will be essential to help the economy rebound,” Stacey Paradis, executive director of the Midwest Energy Efficiency Alliance, wrote in an email.

“The nice thing about this work is there’s a return on your investment when you put in solar and weatherization,” said Charbonneau, in Vermont. “It’s certainly a great investment compared to the stock market right now.”


This article was first published on the Energy News Network and was reprinted with permission.

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The Clarion Energy Content Team is made up of editors from various publications, including POWERGRID International, Power Engineering, Renewable Energy World, Hydro Review, Smart Energy International, and Power Engineering International. Contact the content lead for this publication at Jennifer.Runyon@ClarionEvents.com.

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