Sheet Metal: The Future is Here. Where are You?

Imagine a future with no overhead ductwork. Would your sheet metal business survive? Although the scenario may seem a little farfetched to you right now, the fact is that the HVAC business is changing in some dynamic and dramatic ways.

Smart sheet metal shop owners will be watching and analyzing these changes, and be constantly planning to ensure that their companies are properly positioned in the marketplace. As an example of the kinds of changes that are taking place, look at the trend in commercial buildings to separate the heating and air conditioning systems from the ventilation systems.

New Ventilation Standards
Ventilation is being beefed up according to Standard 62 from the American Society of Heating, Refrigerating, and Air-Conditioning Engineers (ASHRAE). It’s being increased 30% above the ASHRAE Standard to meet the criteria in the U.S. Green Building Council’s (USGBC’s) Leadership in Energy and Environmental Design (LEED®) green building rating system. This is causing many building owners to look to radiant systems for heating and cooling. Water has a much higher heat capacity than air, and building owners are seeing the sense in moving a much smaller volume of water versus a large volume of air. The result? More piping is needed — and less ductwork.

Underfloor HVAC
Another example of change that will affect your business is the growth in underfloor HVAC systems. These systems use much lower-pressure air than traditional ducted HVAC systems, and that low pressure air is distributed from under the floor differently than traditional systems. These systems don’t require large fans or miles of sheet metal ductwork.

But that doesn’t mean you’re out of the equation in buildings that use underfloor systems. Who installs these systems in your area? If you’ve established your sheet metal company as a vital indoor comfort resource, the answer may very well be you. If not, that work could fall to the general contractor or a flooring subcontractor.

Everything’s Coming Up Green
The biggest changes of all are taking place in green and LEED®- registered green buildings. This is growing by leaps and bounds — more than 75% per year, according to USGBC statistics. It’s likely that you and your people are knowledgeable about the requirements that must be met to get a building LEED certified. But are you the LEED experts in your area? If not, why not? If so, have you conveyed that fact to the marketplace, so customers will seek you out?

I feel strongly that in three to five years, all new commercial and highrise residential construction will be green. Customers, especially government entities, are going to demand it. Zero net energy buildings are going to be the wave of the future. Is your company ready for that?

We’re already seeing this in the United Kingdom, where energy is driving the economics of buildings in ways that go beyond simply reducing utility bills. In the UK, new rules for Energy Performance Certificates in new buildings mandate that commercial office buildings project and publish their expected energy use. Over time, we expect that less efficient buildings will receive lower rents than more efficient buildings. In the retrofit market, the same rules will apply, through a system of “delivered energy certificates” that will also publish and grade office building energy performance, which will likely influence building owners to see the sense in investing in energy upgrades.

Even in a booming and energy-rich market such as Dubai, efficient buildings are on the front burner. The United Arab Emirates leaders are mandating that all new buildings use their own version of the LEED rating system.

Time to Establish Energy Targets
Based on the example of the European Union, we are likely to see similar actions in the U.S. In fact, a national energy code may be likely in the near future. A federal code that overrides the morass of local codes is the only way to take building energy consumption from where it is to where it needs to be. We must move away from percentage reductions from existing codes and simply set targets of so many kWh per sq.ft. per year. Buildings that fail to meet such targets would be required to buy energy credits or offsets. This could be a huge driver in the marketplace, particularly in retrofits.

A few years ago, city leaders in Portland, OR realized that the possibility of a powerful earthquake in Portland wasn’t a matter of if, but when. They set about creating strict new seismic standards for new buildings built in the city, fundamentally matching San Francisco’s. The same could happen for energy usage. The question that would remain, however, is how far should such standards apply to existing buildings. At what point is an energy retrofit mandated? At what point does it not make economic sense? Regardless of what code eventually emerges to answer these questions, one thing is certain: the expectation of significantly higher future energy prices will drive the marketplace in the meantime.

Embrace the Times
It’s easy to predict that the sheet metal industry will look a lot different in five years than it does today; the question is, how much? That’s not bad news: smart business people embrace such times, because they’re ripe with opportunities.

Imagine, then examine. Imagine the future, then examine your company’s position. Ask yourself, “In what direction do we need to move our business to take advantage of that future marketplace?”

The commercial HVAC business environment is more dynamic than it has ever been. History tells us that such a dynamic environment tends to shake out the weaker players. You can avoid being one of those by looking ahead, identifying opportunities, responding appropriately, and staying flexible. Don’t just think “sheet metal.” Think about your company’s role in the overall HVAC industry picture. The companies that do that will be the ones that survive and thrive.

Jerry Yudelson is president of Yudelson Associates, which helps grow the business of green building through consulting services, green building books, keynote speeches, custom research reports, and more. He can be reached at 520/207-9759, or e-mail [email protected]. Jerry will be a speaker at the 65th annual convention of the Sheet Metal and Air Conditioning Contractors’ National Association (SMACNA) which will be held in Maui, HI, October 19-23. Visit www.smacna.org for additional information.

The Building Owners and Managers Association (BOMA) is offering a new Green Lease Guide designed to walk owners through the complex language of commercial real estate leases. The guide includes information on lease clauses and includes annotations for owners to “green” their leases to maintain sustainable building operations and management. It includes information on using energy services companies and shared savings contracts. Although the guide is designed for building owners, it’s an interesting resource for contractors. Visit www.boma.org for additional information.