All the stars are aligned for our industry to alter, in significant ways, U.S. energy consumption. How exciting is that? The nation has a desire to reduce its dependence on foreign oil, reduce greenhouse gas emissions, and become more self sufficient regarding energy use. People all over the United States and Canada are beginning to see the need, and federal and state governments are insisting that the goals be accomplished. At the same time, the cost of energy and increased focus on emissions are motivating industries to reduce their use of fossil fuels. The light shining on the long-term cost of operating commercial buildings and industrial facilities is motivating owners and managers to think twice about accepting “value engineering” mechanical insulation out of their buildings, and they are actually increasing the use of mechanical insulation, including increasing thicknesses.

I would like to think that we in the mechanical insulation industry planned for this “perfect storm” heading for our segment of the construction industry, as viewed by architects, engineers, plant managers, owners, and government officials. We knew that significant changes were going to take place that would alter the way architects and engineers specify insulation materials for mechanical services. We did not know when and to what extent the changes would come. We went about the business of manufacturing and installing mechanical insulation the same way for decades. We saw specifications with the same materials, the same thicknesses, the same finishes, all using the same business model for determining what systems would receive insulation and how thick and what material would be used. True, we saw some new and exciting materials and insulation systems, but even with the newest materials available, we struggled to be heard. It was the old economic thickness business model. How things have changed.

This “perfect storm” is changing the way the nation looks at mechanical insulation. For decades those of us in the contracting sector of the insulation industry have been caught in the vise between low initial building costs and optimum life-cycle cost for a building or facility. This subject has been discussed in previous Insulation Outlook issues. We have been asked to “value engineer” our services, which usually meant reduce or eliminate mechanical insulation. In recent months, however, numerous articles written by industry professionals discuss the error of this thinking. In an article entitled “Trimming mechanical insulation from building budgets may lead to higher long-term operating costs,” published by Reed Construction Data, correspondent Don Procter eloquently makes the argument. Cutting or eliminating mechanical insulation is unwise from both building operation and environmental standpoints.

The National Insulation Association (NIA) embarked on a mission many years ago to increase awareness about the value of mechanical insulation in energy efficiency, emission reduction, and a host of other benefits. Recently, the International Association of Heat and Frost Insulators and Allied Workers (International) joined NIA in an alliance to educate members of Congress about the value of mechanical insulation as part of the NIA Foundation for Education, Training, and Industry Advancement’s Mechanical Insulation Marketing Initiative (MIMI). Representatives of NIA and the International have so far visited more than 50 members of Congress and six governors’ offices to educate them about the value of mechanical insulation as it pertains to the legislative branch’s desire to reduce our nation’s dependence on foreign oil, reduce greenhouse gas emissions, and create jobs to stimulate our economy. These visits are producing mechanical insulation awareness, as evidenced by Representative Deborah Halvorson (D-IL) speaking to this issue on the floor of the House of Representatives. Mechanical Insulation, “The Forgotten Technology,” has been mentioned in the Congressional Record. Members of Congress now actually know what mechanical insulation is and, more importantly, what it can do. Change is in the air. Money to help educate the nation about mechanical insulation is now a possibility. It is now a possibility that legislation may be enacted to give tax incentives to energy users to maintain and increase the use of mechanical insulation in new and existing facilities. Credit for increasing mechanical insulation in green building rating systems is also being discussed. It will be more and more difficult for some general or mechanical contractor to insist on “value engineering” the mechanical insulation when the state and local governments insist on greater insulation efficiency or if a facility owner is provided a tax incentive for increased efficiency.

For the first time in my recollection, we are discussing changing the business model under which mechanical insulation is specified. Since I began my career in this wonderful industry in 1964, I have seen the old economic thickness business model used for insulation specifications. The problem is that the cost of energy has escalated dramatically. Ron King, a Past President of NIA, began talking about this dynamic change many months ago. If we are going to get serious about energy efficiency and reducing greenhouse gas emissions, industry needs to adopt different financial models and think about insulation differently.

These new business paradigms will have an effect on the commercial and industrial sectors. The industrial markets are less likely to buy into the “value engineering” idea of thickness reduction, since they usually need minimum thermal values to operate the facility and directly benefit from increased insulation efficiency because it translates into energy cost and greenhouse gas emission reductions, which could translate into tax incentives, which translate into increasing their return on investment. Even in a retrofit situation where some insulation is already in place, increasing insulation thicknesses, maintaining existing insulation, and replacing missing and damaged insulation can save the facility money both on energy consumption and reducing greenhouse gas emissions.

The “Rebuilding America” program sponsored by the Center for American Progress and the Energy Future Coalition has called for a retrofit of 40 percent of the nation’s building stock by the year 2020. Many of those buildings are commercial and institutional, which will provide opportunities for the mechanical insulation industry. Deep building retrofits can reduce energy consumption by 20 to 40 percent.

NIA has embarked on strategic partnerships with dozens of other construction-related associations to educate all sectors of the industry. In addition to holding more than 100 seminars changing how the construction and design community views mechanical insulation, NIA has performed an analysis of the Department of Energy’s Save Energy Now data with Oak Ridge National Laboratory. This data was the basis for an NIA analysis showing that a moderate increase in the use of mechanical insulation could generate nearly $4.8 billion in energy savings and 89,000 jobs. It is all coming together. When people understand what mechanical insulation can do for the operation of a facility and for the environment, they will respond.

There is movement in all directions. The International is working with NIA to promote mechanical insulation on Capitol Hill. Owners and operators are changing the way they view mechanical insulation. Architects and engineers are changing the way they specify mechanical insulation. Contractors are saying no to the old “value engineering” requests. Labor, government, manufacturers, architects, engineers, owners, plant managers, and NIA all promoting the same message of reduced fuel consumption and greenhouse gas emissions? It looks like a “perfect storm.”

When we are successful on all these fronts, we need to be ready to meet the challenges created by all this growth. The manufacturing community needs to be ready with the adequate production capabilities. The distribution facilities need to be prepared to house the materials and have adequate transportation to move the materials to project sites. The banking community needs to be prepared to assist contractors with financing the business growth that will come from this increased interest in mechanical insulation. The contractors need to be prepared to grow their businesses from financial and manpower perspectives.

It isn’t here yet, but it is coming. Architects, facility owners, and mechanical engineers will need to adopt a new way of thinking about the entire building structure and design process to accommodate the insulation systems of tomorrow. Insulation contractors will need to ensure there is a sufficient trained labor force to perform the increased workload. Remember, we are not just talking about new construction with new specifications, but about retrofitting 40 percent of the nation’s building stock. Much of this work is “shovel ready.” Retrofitting existing buildings will show immediate results, putting thousands of people to work in all segments of the industry.

Who will be positioned to act in this “perfect storm”? Certainly, contractors, manufacturers, and distributors who are members of NIA will have an advantage. Many contractors and organizations, including the International, have conducted in-house training or sent their employees to NIA training courses to get ready to meet demand. All across the country, however, many small businesses are not ready to finance expansions. The government must be willing to assist small businesses with this growth.

Get your raincoats out and batten down the hatches. This is going to be a wild and wonderful storm.