Today at HeatSpring Magazine

[Proof Included] When and Why 100% Online Courses Are Better Than Face to Face Training

Posted on May 20, 2013 by Chris Williams

The following is a capstone project completed at the end of a 100% online course. If you think online training courses are poor quality, think again. Read more in detail below.
Coffee-Outsidehome

CoffeyLayout

EnergyModel

EnergyModel2

The above home is a Net Zero Energy Home design and energy model that was completed in Marc Rosenbaum’s Net Zero Energy Home Course in NESEA’s BE Master Series. If you’re an expert like Marc, or would like to learn how Marc created his online training course, I have a few resources for you. First, download Marc’s course syllabus to see how he outlined his course. Second, download our online education playbook. Third, take our course that teaches experts how to teach online.

The Myth – Online Training Courses Are Poor Quality

There’s a long time myth that online training courses are lower quality than face to face training. We have found this to be untrue, and we have the proof that we’re going to share with you.

In fact, what we’re going to show you is that in many instances that quality of online training makes possible, what is 100% impossible with traditional face to face training.

Now, I’m not saying the face-to-face training is poor quality and is not longer needed. There are specific applications when it is the best, and amazing trainers can do a great job. The purpose of this article is to show that the assumption that face-to-face training is always, hands down better than online training is incorrect.

When is online just better than face to face training?

  1. For professional training when the students are motivated and self-selecting to learn a new skill. Also, professionals tends to have less time to travel and don’t have 2 to 3 weeks to take off from work, or spend 1 to 2 nights in a class for 6 months learning a subject.
  2. Need to learn the material quickly and verify that they’ve learned it
  3. The topic is extremely technical and it requires hard skills. Topics that hands-on, by definition cannot be done online, and soft skills training where direct face-to-face role playing are also impossible.

Here’s the proof – Students Capstone Projects

Let’s review what these are, at the end of a 6 week course students submit full energy models and home designs for a net zero energy home. The instructor Marc, reviews all of of them and provides feedback if the designs or models need to be tweaked at all. The students can domonstrately show that they leave the class with a skill that they developed in the course. They want into the class not knowing how to design these homes, and they walk out of it with a fully designed home, an energy model to prove it’s net zero status and all of the tools, strategies, and knowledge they need complete this work over and over again.

Continue reading →

Posted in elearning | Tagged , , , , , , , , , | 4 Comments

What Every Renewable Energy Trainer Needs to Do to Stay Relevant

Posted on May 8, 2013 by Brian Hayden

Progress can make life better!

My #1 piece of advice to all trainers for the next five years: create a digital version of your content.  Do it now.  Create it in little packets so you can deliver them in an agile way across a variety of formats, and swap them out as your expertise evolves.  Do it for no other reason than it will guarantee your job security, because you’ll have created something hugely valuable for whatever organization you work for.

This article is from HeatSpring’s Online Education Playbook. We’re expert at both clean energy AND how to utilize online tools to enhance training. If you’re business depends on training, click here to read HeatSpring’s online education playbook.

In five years we’ll talk about renewable energy training in a completely different way.  Words like ‘online’, ‘webinar’, and ‘hands-on’ will sound quaint – think ‘world wide web’ – and will recede in favor of words that more accurately describe what we’re trying to accomplish.  I want to describe where we’ll be in five years to give the amazing teachers and trainers in our industry a chance to prepare.  I don’t have the technical knowledge to be a great trainer in this industry, but I rely on great trainers and want you all to have jobs in five years!

We’ve created a series of courses for trainers interested in doing more teaching online, and started writing some straightforward articles like how to convert webinars into courses that might be useful for the trainers out there.  Specifics are better than generalities, so we’ll try to give some tangible suggestions you can actually act on.

Keep Your Eye on the Ball

OK…let’s start by establishing the goal of training: to transfer skills and knowledge.  There’s tremendous value to be gained by companies, customers, and the industry if we can transfer skills and knowledge to more people.  Companies can grow, industries can thrive, and customers can be better served.  That’s why manufacturers and distributors and trade schools invest in training.  Everyone agrees it’s critical.  So we start with a list of skills and knowledge we hope to transfer.  You can call this a Job Task Analysis (NABCEP), Learning Objectives (AIA), or whatever.  [here's an example]

As any trainer knows, for true skill transfer to occur you need to do more than tell someone once.  There are really five things that need to happen before they actually get it:

  1. Tell them [lecture]
  2. Show them [pictures or site-visit]
  3. Have them read it
  4. Have them experience it [hands-om]
  5. Have them teach it to someone else

As trainers we live in an imperfect world and never have enough time to do our jobs.  It’s expensive to train somebody, and a huge pain to manage because work schedules change, there’s always turnover, plus new products and new learning is happening all the time.  The training department is rarely funded or staffed appropriately to do the job as well as it could be.

Why is creating digital content such a valuable step?

Creating digital copies of your lessons is a pressure release valve for your training program.  Now you have the flexibility to deliver learning before, during, and after the time you have to physically spend with people.  You can build this set of assets in a way that helps the student experience all five methods of knowledge transfer by making it all available digitally, all the time, and layering field exercises, conferences, meet-ups, and seminars over the top of that foundation.  Training begins to melt into the routine of everything we do, rather than being held up as a special thing that we need to set aside time away from the job for.

Education is going digital – this is not a fad.

I feel fortunate to have recently joined the IREC Standards Committee and look forward to learning from my peers through that work.  IREC provides a tremendous service to the renewable energy industry and I’m humbled by the great work of my fellow committee members.  The small contribution I hope to make on this committee is to update the way we think about delivery methods.  My audacious goal for the next five years is to eliminate the words ‘online’, ‘webinar’, and ‘hands-on’ from the training lexicon in this industry and move toward a set of terms that more accurately describe what we’re all trying to accomplish.  We all have mental models for ‘face-to-face’ and ‘online’ training that I think will melt away over the next five years.  My goal is to be a small part of helping IREC get ahead of that.

The exciting part?  It’s going to make life better!  Digital delivery of basic concepts means you’ll be able to spend more time on exciting content and advanced topics.  You’ll have better visibility of what people are learning and be able to rely more heavily on metrics that show your boss what a great job you’re doing.  We’re entering a golden age of education technology where powerful tools are cheap and easy to use.  Get on board now and you’ll be leading the pack in five years.

Posted in elearning | Tagged , , , , , , | Leave a comment

6 Reasons Why A Course is a Better Online Training Tool Than Webinar Training

Posted on May 8, 2013 by Chris Williams

This post outlines why, when you’re teaching advanced material online and you need to verify that the students have learned and implemented your material, courses are a better online training tool than webinar training.

This article is from HeatSpring’s Online Education Playbook. We’re expert at both clean energy AND how to utilize online tools to enhance training. If you’re business depends on training, click here to read HeatSpring’s online education playbook.

If you are currently rolling out an online training program and are considering how and when to use webinars, this article is for you. If you already have a series of webinars, and you’d like to increase their effectiveness, this article if for you.

If you’ve already created a series of webinars, don’t feel bad. You’re miles ahead of companies that have done no online teaching at all! If you have a series of webinar content already, you have a solid found of information that you can improve upon. You can sign up for this course to learn how to turn those webinar trainings into great online training courses. Click here –> “How to Turn Your Webinars into Amazing Online Training Courses”

This article is also for our HeatSpring students. We’re often asked: “How does this online course work? Is it like a webinar?” Our response is “yes, its like a webinar, but much better” This article will explain why.

Frequently, we’re asked by manufacurers that want to do a product training or one of our instructors to use webinars as the main means to run a course. A few years ago, we used webinars, but quickly found out that they are not an effective tool for the type of high quality training that we do.

HeatSpring Training Playbook

We’re creating the HeatSpring Training Playbook that will teach everyone how to deliver amazing online trainings. Since 2011, all of HeatSpring students have taken material online, either blended as part of a face-to-face course, or 100% online. By doing this, we have learned exactly how to deliver blockbuster amazing education in an online format.

We’re sharing HOW we use technology to deliver amazing trainings and amplify the impact of our trainers to the benefit of our students and customers. Our goal? Help other people improve their training by at least 10X, hopefully 100X better than they are. Higher quality training, faster, and with fewer resources in terms of cash and time. The first post for the playbook is how to use blended learned to increase the effectiveness of your face-to-face training.

Why Talk About Webinar Training

Webinars are critical to discuss in online education because they’re extremely common, frequently misused, and there are better options.

My goal is not to be negative just to be negative, but because I strongly believe (based on our experience and the number of students we’ve trained) that webinars are a horrible way to deliver very advanced information if you need to make sure that the student is learning and implementing what they’ve learned.

To be sure, here are a few things that webinars can be good for, and we use them for these applications. 

  1. Short live presentation on very simple topics. Think about a 20 minute company update or a short “education” bit that is veiled as marketing and good enough content to charge money for.
  2. Live Q+As. Webinars are okay for this, I’d argue Google+ is actually better. Both work.
  3. 1 on 1 conversations where it’s useful for the teacher/instructor to show their screen while troubleshooting as issue or walking through a problem.

What subjects are webinars not good at?

Here’s are few examples of the type of subjects that live webinars are not so good at. This is based on our experience building online courses like; Net Zero Energy Design, Geothermal Designer Boot Camp, 40 Hour Advanced Solar Training, Manual J Boot Camp and others.

These ideas are coming from our history doing clean energy training, but with this list you can imagine many topics across many different industries.

  1. How do you size a 500kW bi-polar inverter?
  2. What’s the best way to size a pump?
  3. How do you structure a PPA?
  4. How do you test and measure soil conductivity?
  5. How does debt financing work vs lease financing?

Why are webinars insufficient? Why are people using webinars?

The reason people are using webinars is that they “kind of barely work” for this situation and they’re the closest tool that exists that most people are aware of. The problem is that people try to use webinars to teach a large group of students VERY complex products, concepts, skills and technologies where it’s VERY important to know how well students learned the information.

For this application, webinars don’t work, you need to be building courses.

Continue reading →

Posted in elearning | Tagged , , , , , , , , , , , , , | 1 Comment

The Holy Grail of Face-to-Face Training and How Make Your Trainings 100X Better

Posted on May 3, 2013 by Chris Williams

We’ve found the holy grail of training and I want to share it with you. This article is for professionals that are consistently doing a lot of face to face training for marketing, sales, or technical purposes.

This article is from HeatSpring’s Online Education Playbook. We’re expert at both clean energy AND how to utilize online tools to enhance training. If you’re business depends on training, click here to read HeatSpring’s online education playbook.

Background: HeatSpring –> Cammpus

 

We’re experts at training AND clean energy, but for a long time we only talked about the clean energy part and not HOW we were delivering that training and what we’re doing to make it awesome. We’ll now be sharing HOW we teach, so others that need to improve the effectiveness of their training while lowering their costs can do so.

For 2 years now, all of HeatSpring’s students have all taken online training, either 100% online or blended learning. This has allowed us to train more professionals, at a very high level, and with limited resources. We developed a software product, called Cammpus, to run our training. There are a number of organization using Cammpus to run their training including; NESEA, Training for the Trades, S+H Construction, DCNE, and Viega North America. If you’d like to use Cammpus for your training, click here to sign up for a 30 day free trial.

If you want to learn how utilize blended learning and why it’s awesome, sign up for our course “4 Steps to Utilizing Blended Learning for Your Trainings”

With today’s technology a group of 5 trainers, can do the work of what it took 10 trainers to do 5 years ago, and show measurable results.

Back to the point :)

Imagine this scenario….

You’re responsible for running trainings frequently. This could be because you’re a corporate trainer with a manufacturer, you provide training as a distributor, you’re a manufacturer’s rep, or you work in marketing and sales and use training to get in front of customers. You’re likely training on new products, basic concepts, safety topics, continuing education credits and advanced design and installation principles topics, dealer/contractor education, and sales.

Your trainings last from one hour to a few days, so you have a very limited of time to spend with students and you need to teach them a lot of information. The same old gig, tons of information to teach, and not enough time. We know the drill.

On day 1 of training, in a perfect world, you walk into the training and here’s what you already know:

  1. You already know all the students by name, where they’re from, and have already corresponded with them.
  2. You know about their businesses, what they do, and their business goals, and what is holding them back
  3. You know exactly what they’re struggling with so you can customize the material
  4. You already know that they have a detailed understanding of what you’re going to talk about and the basic principles

Why is this so amazing? Why is Blended Learning the Holy Grail of Face to Face Teaching?

  1. You can tailor your general presentation to fit the needs of the specific audience. By gathering information, interacting, and teaching your students before day 1, you can tailor your training to fit their needs.
  2. You can skip the introductions and get into the details. Too much time is wasted getting to know each other on day 1. It’s not that getting to know each other is bad, it’s just that the instructor wants to build a rapport with everyone and see where they are coming from, this can take a long time.
  3. You can skip the basic material and get into the good stuff. Too much time is wasted going over very basic material at the beginning of the training, but teaching the students BEFORE you get to the face to face section, you can spend the face to face time no more important topics.

Here’s another reason blended learning is amazing

  • Most face-to-face trainings are like drinking from a firehouse for the students. They need to learn 10 things in 1 day, but they’ll only walk away with 2 or maybe 3 things. Blended learning allows trainers to put all of the information about the training online, so that students can revisit and clarify information 1 week, 1 month or 3 months after the training. By giving students a central place to come back to over and over.
Posted in elearning | Tagged , , , , , , , , , , , , , | 2 Comments

50% Off Solar Training for Massachusetts Based Employees and Companies, up to $3,000 per Employee and $30,000 per Company

Posted on May 3, 2013 by Chris Williams

This article is quick, but awesome!

If you’re a Massachusetts company and looking to train employees on solar, you can apply for a workforce training grants and get 50% off, 3 HeatSpring trainings.

This is for companies that need to re-train or training existing employees or new hires, it’s not for individuals (sorry guys).

If you want help with the application, fill out this form and I’ll give you a call.

Massachusetts Workforce Development Fund

If you want help applying for these funds, let me know.

Here are the details.

HeatSpring has the following courses approved for the Workforce Training Fund Express Program.  Applicants are now eligible to sign up for your course (s).

Applicants can go to the on-line application at www.mass.gov/wtfp and click on “Express Program” to apply on line to receive 50% reimbursement of the cost of training.  The program is capped at $3,000 per employee for a maximum grant of $30,000 over 24 month period.  For more information regarding the Express Program go to www.mass.gov/wtfp/express

You should provide your course id number to applicants who are interested in taking your course.

Click here to start the application process. 

If you have questions or concerns, please feel free to contact Jason Albert at 617-626-5190 or jalbert@detma.org.

Here are the details for the application that you can read here.

  1. Identify Training Provider and Course identification number for online application
  2. Submit a Department of Revenue Certificate of Good Standing - fax to 617-723-5594
  3. Submit online application
  4. Applicant will receive an approval letter and a Massachusetts Standard Contract (with initial submission)
  5. Applicant must return Contract within 15 days
  6. Applicant will receive a signed contact and payment voucher, and can start training. No training can start until a contract has been executed and an official start date established by the Contract and Procurement Department. Any training done prior to an executed contract is not reimbursable.

Who is eligible to apply? Read other FAQs here. 

Businesses with 100 or fewer employees in Massachusetts – including all plants and branches – and labor organizations with unlimited membership may apply. All applicants must contribute to the Workforce Training Fund.

Applicants must provide a current (must be less than 6 months old) Massachusetts Department of Revenue Certificate of Good Standing with initial application and return properly executed contract documents. Fax to Express Program: 617-723-5594.

Can a nonprofit organization apply for Express funds?

Yes, a nonprofit organization can apply for training funds provided it pays into the Workforce Training Fund.

Can units of state, local, or county government apply for Workforce Training funds?

No, governmental entities may not apply for these funds. The purpose of the Fund is to benefit Massachusetts businesses and their employees.

Can a non-Massachusetts-based company apply for Express training funds?

Yes, a non-Massachusetts-based company can apply for training funds provided the employees to be trained are based in Massachusetts.

Will an organization’s level of income, sales, earnings, or profits have any bearing on its ability to apply for Express funds?

No, the level of income, sales, earnings, or profits will not preclude an organization from applying for Express funds.

Who is eligible for training? Read other FAQs here. 

Massachusetts-based employees. This means that workers whose training is funded by this program must be working at a location in the Commonwealth.

If my worksite is in Massachusetts, but some employees live outside of Massachusetts, can they be trained with these funds?

Yes, as long as your employees work in Massachusetts, they are eligible for training regardless of where they live.

Can contract workers be trained with these funds?

No, contract employees are not eligible to be trained with these funds.

Can part-time employees be trained with Workforce Training Fund funds?

Yes, both full-time and part-time employees are eligible for training.

Massachusetts Workforce Development Fund

If you want help applying for these funds, let me know.


Posted in Solar Photovoltaics | Tagged , , , , , | Leave a comment

Off Grid Solar in Downtown Boston

Posted on April 12, 2013 by Chris Williams

(Download this schematic at the end of the article)

Designing and installing solar PV in dense urban area is much more difficult than installing 5kW on a 10 pitch shingle roof in the suburbs. The challenges are numerous and include junky roof framing, town homes and apartments with low roof area-to-electrical load ratios, historical committees, and, interconnection to antiquated electrical grids.  For this reason, most pure play solar installers and financiers tend to stay away from the hard stuff, they’re still focusing on getting the lowest hanging fruit. However, clients in urban areas are asking more and more solar solutions.

This is the story of how Jamie Leef at the solar division of S+H Construction installed an off grid solar PV system; off-grid in the sense that it did not interconnect with the area network grid in downtown Boston. If you think off-grid/solar power backed-up systems are a thing of the past, think again. They’re likely a thing of the future, as one of nations largest utility IPPs, NRG Energy, is pushing towards solar + battery backed up.

Jamie Leef and S+H Construction are expert builders (see all their awards–>), used to dealing with integrating solar in complex existing systems and structures and is an expert at installing solar in urban areas. If you’re an architect or engineer and need to get advice about integrating solar PV into a complex structure, give Jamie a call.

Continuing Education Free Course

Jamie has created an amazing continuing education course for architects, engineers, and generators. Click here to sign up for FREE COURSE (for a limited time) “Solar PV Design Considerations in Urban Areas for Architects, Engineers and General Contractors”

I had a quick conversation with Jamie about the installation. If you’re a general contractor, roofer, architect or engineer and need help with a difficult project, contact Jamie at S+H Solar here. 

Q: Let’s start at the top, what is the reason for having an off-grid system in downtown Boston?

A: There are several sections of Boston, Cambridge in Springfield Massachusetts where the grid is much older.

Normal electrical grids are radial networks where transmission lines come from a substation to transformers and feeders going to several homes.  It looks like a hub and spoke.

An area network is an older style of distribution that involves multiple grid feeds, transformers and building service access points.  It looks more like an Ethernet network.

The switchgear is much older.

Some utilities have been experimenting in different parts of the country with DG and back-feeding area networks, but engineers are very afraid of this because it’s easy to blow up one of the transformers and the nature of the area network can to shut down if there is any backfeeding.

Q: So, I’m guessing you had a client who wanted solar in an area network?

Our client wanted solar but they were in an area network. They have a house that had a substantial electric use. We were able to design a solar PV system on their property that serves their loads, but doesn’t back-feed into the grid.

We did this by using an off-grid style design where there are batteries fed by solar, and a backup generator. In this case, the backup generator is the grid.

Q: What is the design theory for this application? What loads are you matching? Is the project off grid in the sense that the PV array only charges the batteries, the batteries go to the inverter to supply house loads, but the grid can also charge the batteries?

A: The batteries feed all loads. If they become low, the inverter will switch to the grid until the solar has enough power to supply the load, or until the solar has charged the batteries enough to supply the load.

We designed the system to charge the battery bank in a reasonable period of time so that batteries can meet the average daily loads that is supported by the sun.

In this particular application, there are two parts of the condo each with it’s own electrical service panel.  One part includes several rooms and some general, non-essential loads. The second part includes the kitchen, some general lighting, and other circuits that are more critical loads that would be nice to be backed up in an electrical outage.

The nice thing about an off-grid solar system is that you’re actually your own utility. As long as the solar is powering the batteries, you have power.

Q: What were the building and utility integration considerations for building in downtown Boston?

The project is on the top of a 20 story building, so construction is always a little complicated. It’s on the top of a high rise with a ballasted roof, so the wind loads are high which have to be dealt with, but it’s nothing that our roofers are not used to dealing with.

It required a significant amount of negotiation with the utilities for the client to be able to satisfy the Commonwealth Solar Grant program.

There was a design challenge in sizing the solar array and the battery bank for the load that you want, this case the client had to decide how much of their home they wanted to be off-grid.  The hourly, daily, and seasonal profile of these loads determined how many modules were needed, and the size and cost of the battery bank.

Another challenge was locating the batteries. Traditional solar batteries are not well suited to be put into living spaces due to hydrogen build, fire hazard, and other issues.  We chose batteries very carefully.

The final item is to figure out house wiring. In the case of a renovation, it’s a little easier because the project electrician can place circuits as needed. In the case of an existing home, it can be a little difficult to break out loads in the most optimal way.

Q: You mentioned the largest challenge was getting the utility to sign off on the project. Why was this a challenge?

It’s easy for a solar installer to say “my system is not going to back-feed”. It’s a different challenge for a solar installers to sit in a meeting with 6 utility engineers that and PROVE that the UL 1741 listing for inverters is a guarantee that they can live with and guarantee that there will be no backfeeding. These are engineers that are very familiar with the nature of the electrical grid. This required us to bring in PE and do some pretty intense negotiation.

The reason we need a letter from the utility is to prove to the Commonwealth Solar rebate program that you can get the “interconnection agreement” and access grant funding form the Renewable Energy Trust.  They need to be grid tied to use their grant money, which comes from the Renewable Energy Trust.

In this, it’s connected to the grid, but it’s not interacting with the grid. There was no regulatory structure for what we were doing, so we had to create a structure.

We invented a new category for a non-interconnected, utility oriented system. In order to get this, we had to convince the utility engineers.

Q: What were the lessons learned and what is your advice for architects, engineers and property owners that might live in a radial network and want solar. If someone called you and wanted advice, what would you tell them?

The cost of the system with batteries is higher than the cost of a normal grid tied system per kW because of the high cost of the batteries.

However, we have many clients that want some kind of back-up generation in their homes. In the suburbs, people will get a transfer switch and a generator. People like having backup power.

One of the advantages with a battery based solar project is that you already have a backup generator. That is actually worth the money because getting solar with batteries is CHEAPER than getting solar with a backup generator.

Also, in a densely populated area, it’s harder to get a generator because it makes a lot of noise.

Battery backed up solar PV is silent and economical when compared with a backup generation if you were to buy a generator. If you want backup generation and have room for solar, having a battery back up is a great alternative.

The property described here also has solar thermal integrated into it and that can be just as good an option.  This is especially true in a condo situation where several owners want to share solar the resource.  The physical installation can be easier because shared mechanical infrastructure is common for domestic hot water systems.  At S+H we have innovated a fractional ownership model that will allow individual condo owners to monetize incentives.  Keep that option on the table.

Q: How do you determine if a client is a right fit?

They have to be committed to solar and have the roof space.

Condominiums are another issues to consider. If you live in a condo, you’ll need to confirm that you have the roof access and roof rights.

Q: If they are want to get a battery based solar system, how do they make sure the process goes smoothly?

There are two huge roadblocks for an installer who has not done this before. First, no having proper documentation of past projects to show to the utility. Second, not having the relationships in place to meet a construction schedule.

I know the exact person to speak with and I have a special letter from the utilities in case we want to do another one of these projects. We have a letter from upper management at a utility that we can use over and over again. If you don’t have this, it will take you a long time to go through the process.

Download Non-Interconnected Solar PV Design

Download the basic drawing of the system after giving us some information about yourself.
Posted in Geothermal and Solar Design and Installation Tips, Solar Photovoltaics | Tagged , | Leave a comment

How We Financed a 13kW Solar Project on a Church in Massachusetts

Posted on April 9, 2013 by Chris Williams

The following is a guest post from Fred Paris, the instructor of our Solar Installer Boot Camp. Fred tells the story of a church that he worked with, and how the members came together to finance the project for the church. This could provide a model for non-profit clients that you work with that really want solar. If anyone has any questions for Fred, please leave them in the comment section.

I’ve put some comments in [brackets]

Enter Fred Paris

A church wanted to install a 13kW PV system. Intuitively knowing that the $4,000 budget would never cover a system of this size; we went ahead and designed a 13kW system and agreed to test different ideas on how to pay for it.  The survey done, the system designed, and along with some structural reinforcement, the cost would be $65,000. [13kW at $65,000 gross installed cost is $5.00 per watt] We went in knowing the church would not qualify for the 30% federal tax credit or the state tax credit.  Using projections, we knew the system would generate more than a megawatt of energy a month and some $3000 a year in electricity in our 18¢ utility.  The project was presented to the congregation along with a financial plan showing the possible ROI available for a third part owner, if one could one be found.  We agreed to put a plan together.

The plan was to form a for-profit LLC to buy and own the system.  Since profits from an LLC flow down to LLC members [the flows of profits and losses will depend on how you set up the operating agreements], those having tax liabilities would use the federal and state credits of more than $20,000.  The church would continue to pay a lower 14¢ monthly electric bill to the LLC, the LLC would get the SREC payments – we used a conservative projection of a couple hundred dollars a month, [I would use $175/MWh as the lowest effective value of SRECs in Massachusetts, read more about the impact of SREC assumptions on project IRRS here] – and would depreciate the PV system as an asset they own.  Recognizing the startup cost to setup the LLC, along with legal and insurance costs for the life of the arrangement, the financial breakeven for the LLC would be less than 8 years. [The financial break-even is when the Net Present Value goes from negative to positive]  Eight years later, the system is fully paid and the church stops paying the reduced 14¢ rate.  The LLC then votes to donate the system to the church – with perhaps another write-off, and the LLC is dissolved.  Everybody wins.

We need to look beyond the financial dollar amount of PV incentives and consider value.  The same financial incentives can have more or less value depending on the owners’ tax and financial position.  The church’ tax situation was obvious, but there are many for-profit businesses that will not have a significant tax liability. You may want to explore setting up a single-purpose business entity to capitalize on the incentives.  Everybody can win.

I asked Fred a few more questions about article

1 – How much were the legal fees for setting up the LLC, PPA etc? Who did you use to do this? How did you make sure the documents were legit?

Part of the group was a lawyer so he took care of all of the documantation. A simple LLC can be done for $1,000. However, this becomes more expensive and challenge when you have multiple investors because you need to establish clear operating rules for the LLC that explicitly say how the profits, losses, and credits of the LLC will flow.

2 – How many church members were there? Did they each buy into the LLC evenly to make the operating agreement and flow of credits and cash simple?  

There are 5 investors, and no, they did not invest evenly but using a simple percentage of investment equals percentage of SRECs or whatever – this works OK.

3 – How long did the whole process take verus a cash sale? i.e. if it would have taken 4 months to do the project with a cash sales, how long did it take with the LLC?  

Once the decision was made to go with the LLC, the project moved along at a good pace.  Creation of the LLC was not on the critical path - plenty of slack time.

A Few More Notes and Thoughts about Fred’s Project

1 – The investors didn’t want to make money, they wanted the church to save money. This is fundamental in the sales process, understanding what each party wants. If the investors had wanted 15% return over 8 years, the project likely would not have happened. What they wanted was an amazing way to donate to the church (because the church would save money) without loosing any money, because they got it all back!

2 – Their legal fees were essentially free, because one of the church members was an attourney. If legal fees were $10,000. This would have increased the installed cost from $65,000 to $75,000, or from $5.00 per watt, to $5.76 per watt or a 15% increase.

Here are the rough financial analysis for the project that Fred describers. Note, I did not take into account insurance costs, or sales tax, but I did take into account.

If you want to use the same model I’m using, download the basic solar PV model here. If you need a really robust commercial solar PV model download it here. If you need to learn how to finance commercial solar projects, sign up for the Solar MBA.

Here are the project assumptions. IRR = 11.50%.

What happens if legal fees are $10,000?

If the legal fees were not free, they would increase the installed cost from $5.00 per watt to $5.76, this would decrease the IRR from 11.50% (see above) to 8.73%.

How do you determine when the partnership flips?

In a partnership flip, the flow of cash flow changes when a specific party, typically investors, have received a certain IRR or a specific NPV on a number a years. In the case of the churn, the investors only want to make back with lets say a 4% return. If we set our discount rate to 4%, we then need to see when the net present value is equal to zero. We do this calculation by simply adding the present value of each years cash flows together. Here are the results. Notice how the “Cumulative NPV” goes from negative to positive in year 8?

 

Posted in Financing, Solar and Geothermal Sales and Marketing Tips, Solar Photovoltaics | Tagged , , , , , , , , | Leave a comment

The #1 Most Useful Person to Know in the Geothermal Industry

Posted on April 4, 2013 by Brian Hayden

Ryan Carda bet me that South Dakota State would beat Michigan in the NCAA basketball tournament this year.  He lost.  Ryan’s not a great gambler, but you know what he is great at?  Everything related to geothermal heating and cooling.  In fact, I believe he’s the single most useful person you could ever know in the industry.  Here’s why:

  • He knows the technical stuff inside and out.  If the fact that he wrote the new IGSHPA Design & Installation manual isn’t proof enough, here’s a short lesson from his Certified GeoExchange Designer (CGD) course:

  • He’s an amazing teacher.  In fact, he’s the highest rated instructor we’ve ever had teaching a class on any topic at HeatSpring.  Averages 9.8 out of 10 on his student ratings.  His most popular course is the Geothermal Designer Boot Camp.
  • He’s young and hungry, so you can actually talk to him.  I know a lot of smart people who never return my phone calls.  Look at that picture again – does he look intimidating?  Ryan’s number and email address are on his website and I’ve never heard of anybody having trouble getting in touch.
  • He’s well connected.  Ryan studied under the legendary Chuck Remund, and has gotten to know a ton of people through various lines of business.  He wrote some amazing geothermal design software, sells grout, supports thermal conductivity testing, and teaches all over the country.  This winter he was in Korea supporting some huge geothermal projects.  When I want to find the right person to talk to on a project, I always start with Ryan because he saves me time.

If you’re headed to Vegas, Ryan Carda can’t help you.  If you’re new to the geothermal industry or looking for an experienced partner to work with on a project, I can’t give a stronger recommendation that Ryan is your best bet to start with.  At the end of the day, an ‘industry’ is just a big group of people, and it’s useful to know the best.

Posted in Inside the Classroom | Tagged , , , | Leave a comment

4 Trends Driving the Geothermal Heat Pump Industry in 2013

Posted on April 1, 2013 by Chris Williams

For a long time, the geothermal industry has assumed that if everyone just magically knew “how efficient” the technology is, that they would just adopt it. That is never going to happen. There’s many othervariables that matter much more than the system efficiency.

What will not drive the Geothermal Industry

  1. Continuing to recite over and over again how efficient the systems are. First, prove it. Tests performed in laboratory conditions and software models do not cut it. Real time monitoring is the only way to solve this.
  2. Second, homeowners only care about efficiency in how it impacts their savings. Translate efficiency into savings. No homeowner cares about COP.
  3. Economies of scale will not reduce installed costs. Similar to the solar thermal industry, geothermal is simply reconfigured commodity equipment. If the geothermal industry grew by 100x, the installed costs would drop slightly, but not drastically. The cost reduction would come from soft cost efficiencies, marketing, sales, lower margins can be accepted due to higher volume. We can’t rely on lower installed costs to drive our market.
  4. We do have the potential to reduce borehole length. Over the past 12 months, I’ve spoken with roughly 5 firms woking on better ways to install the ground heat exchanger that will shorten the loop. Not all of these technologies will work, but we need to be happy and welcoming to the firms trying to do push innovation. This is amazing, we need this innovation, and as an industry, we need to find a way to support these innovators as much as possible.

Here is what Can Drive the Geothermal Industry

Geothermal Trend #1 – State Policy Will Drive Adoption

In states that are heating dominated and using expensive heating sources, like New England, the policy is clear. Oil elimination. Sometimes called Renewable Heating and Cooling. Several New England States are getting bullish on this (NH, MA, ME, CT, and maybe VT), but we need to put gas on the flames.

Heating Policy

  • New Hampshire has established a thermal REC program
  • Vermont and Renewable Energy Vermont has established task forces to figure out how to achieve 90% renewable energy generation for all energy sectors by 2050.
  • Massachusetts has a yet to be released, pilot program of $6 million dollars for heat pumps and biomass that will be going into effect in 2013.
  • The Massachusetts DOER, with the help of Meister Consulting group,  has submitted to the legislature a report to the legislature on December 2012, outlining several policy measures that would help renewable thermal technologies.

Cooling Policy

In states that are cooling dominated, or states that are heating dominated but use natural gas and thus electric utilities are peaking in the summer, the policy to focus on is clear, peak demand side management for cooling in the summer.

Western Farmers Electric Coop put out a great article on their rebate program describing the impacts of ASHP and GSHP on demand side management. This case study needs to be the cornerstone of our policy efforts in cooling dominated areas. 

Why is this important and how does it impact your business?

  • If you’re serious about geothermal and it’s the future of your business, we need you to get active and help get policy through. Policy will not happen by itself, we need to push it. 
  • Getting policy in place in addition to the 30% ITC will make geothermal much more affordable to the general public. Cheaper equals growth.

Geothermal Trend #2 – Real Time Monitoring Can VERIFY Performance ans Reduce Risk for Property Owners

I wrote a full article on the subject that you can read here: Real Time Monitoring and Performance Based Contracts Are the Future of Geothermal

I’ll provide a little recap.

  • The top 50% of the best geothermal contractors now have the ability to double their business and put all of the fly-by-night geothermal installers doing horrible work out of business.
  • Performance based contracts remove risk from the property owner, making them more comfortable in the investment.
  • Real time monitoring will be required for production based incentives that New Hampshire has, and that other states are looking to create them.
  • Read more about performance based contracts here, how they could work, and what you’d need to add to your existing contracts to implement them.

Geothermal Trend #3 – Communications and Industry Research

The geothermal industry is currently run by contractors and engineers, generally speaking. We need to determine the best way to sell these projects and gather real data on the projects that we’re putting in.

  • Because our industry is still extremely niche, we don’t have a lot of data on it. This is hurting us from a policy perspective by making it harder to find allies, but also from a sales perspective. Not having a lot of data on existing systems increases the perceived risk to property owners. Here are a few questions we don’t have answers to:
  • How large is our industry?
  • How quickly is it growing?
  • What is the size, growth rates, etc in different regions and states? by customer category?
  • How many jobs does it employ?
  • How many dollars per dollar invested in the US, stays in the US?
  • What are average installed costs by region, by system type, by system size?

Geothermal Trend #4 – Fuel Prices Increasing

Exactly the same as solar thermal, installed costs will not be dropping, but fuel costs will rise, increasing the value of geothermal output.

It’s clear oil, propane and electricity costs will continue to increase, there’s growing evidence natural gas prices will also increase. Here’s the logic behind gas prices increase.

The low cost of natural gas has created trends that will increase demand, and cost, 1) exporting the gas, 2) converting coal power plants to gas, and 3) light truck usage.

Deborah Rogers has done some amazing research on the shale gas bubble, why gas producers are loosing money hand over fist, and why prices will likely be increasing over the next few years. More more about the shale gas bubble here.

Posted in Clean Energy Policu, Geothermal Heat Pumps | Tagged , , , | 1 Comment

April 2nd – Free Long Island Energy Efficiency Sales Training

Posted on March 29, 2013 by Chris Williams

LIPA has arranged for Peter Troast of Energy Circle PRO, a renowned marketing expert exclusively serving the energy efficiency community, to present an Efficiency Contractor Marketing One Day Bootcamp. This workshop is available, AT NO COST, to any contractor participating in a LIPA sponsored program Home Performance, Cool Homes, ENERGY STAR Homes.

RSVP HERE

Chris’s note: LIPA and Energy Circle are using Cammpus to run the event. Cammpus easily allows any company to create their own university and run their own courses. If you’re a manufacture or distributor that needs a robust training tool for blended sales and product training, sign up for a Cammpus demo here.

This one-day course is designed to teach contractors the nuances of marketing residential energy efficiency–from auditing to whole house retrofitting to heating and cooling systems. The course will introduce contractors to the world of business-to-consumer marketing and the nuances of telling the home performance story.

This course is ideal for home improvement and home performance business owners looking to grow their businesses through the LIPA programs. Considerable attention will be paid to leveraging program resources and promoting a unified message.

CORE Learning Objectives

  • Understand the fundamentals of marketing in the new world–both online and offline
  • Learn about highly effective tools and tactics in traditional and web-based marketing, specific to Energy Efficiency businesses
  • Come away with practical, actionable plans–a marketing plan, tactics roadmap, and budget

After participating in this day-long course, contractors will have a foundational understanding of:

  • Developing a comprehensive marketing plan and budget;
  • Essential marketing metrics including cost-per-acquisition of leads (CPA);
  • Effective, low cost search engine optimization (SEO);
  • Social media strategy and using social media to drive sales;
  • Converting web traffic into sales leads;
  • Using traditional marketing campaign materials (i.e. direct mail, trade shows, etc.);
  • Implement an online marketing campaign (website, email marketing, social media);
  • Managing a comprehensive web presence;
  • Creating a content strategy to drive inbound traffic;
  • Getting the most out of email marketing.

The course will be submitted to BPI, NATE, RESNET and NABSEP for CEU Approval.

Location:

Molloy College – Suffolk Center
7180 Republic Airport
East Farmingdale, NY 11735

Posted in Building Efficiency | Leave a comment