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Understanding the Boiler MACT Regulation for Area and Major Sources

Rarely is it that a specific environmental regulation
becomes so high profile as the recent Industrial Boiler Maximum Achievable
Control Technology (Boiler MACT) regulation, which has been the subject of
myriad bills that have come before the U.S. Congress. The Boiler MACT has been
cited as a clear division point between the two major political parties in the
United States, with the ultimate fate of facilities to be determined within
months after the election in November 2012. The political back and forth has
led to a limbo status for the major source regulation?with “major source”
defined by the U.S. Environmental Protection Agency (EPA) as “a stationary
source or group of stationary sources that emit or have the potential to emit
10 tons per year or more of a hazardous air pollutant [HAP] or 25 tons per year
or more of a combination of hazardous air pollutants.” This regulation will be
critical for those in the insulation trade: insulation is critical for
industrial boilers and process heaters as it is employed for the reduction of
heat loss and the increase of boiler efficiency; and it is one method of
reducing emissions outlined in the Boiler MACT regulation, potentially lowering
fuel costs and usage by enhancing the boilers’ steam system insulation.

The many recent changes to the Boiler MACT standards have
left industries confused and unsure of the reporting, testing, monitoring, and
further compliance measures that must be taken to operate within the standards.
In 2011 and 2012, the EPA released extensive revisions to the National Emission
Standards for Hazardous Air Pollutants (NESHAPs). The standards are divided
between 40 CFR Part 63 Subpart JJJJJJ for affected “area sources”?defined as
“any stationary source that is not a major source” ?and 40 CFR Part 63 Subpart
DDDDD for major sources, as defined by the respective air permits of the
facilities. Of the units affected by the regulation, the most rigorous emission
limits are assigned to those boilers and process heaters employing coal,
distillates, and biomass as fuels.

The regulations have had a bumpy recent history. A version of
the Boiler MACT standards was released in April 2010 and received over 4,800
comments from businesses and communities, some of which led to a change in
proposed subcategories and emission limits. In turn, the EPA published the
regulation into the Federal Register on March 21, 2011. The current final form
of the standard under Subpart JJJJJJ (with proposed amendments) was published
to the Federal Register on May 18, 2011. On March 13, 2012, the EPA issued a No
Action Assurance Letter for area sources. The EPA determined that further
public review was required for Subpart DDDDD and in May 2011, under the
authority of the Administrative Procedure Act, announced a delay of effective
dates of standards for major sources. On January 9, 2012, the U.S. District
Court for the District of Columbia, in Sierra Club versus Jackson, vacated the
EPA’s administrative stay of the Boiler MACT, thus making the March 2011 major
source standard effective. On February 7, 2012, the EPA issued a No Action
Assurance Letter for major sources. Currently, the EPA proposes to issue the
final rule before the compliance dates for existing sources.

The current Boiler MACT standards divide facilities’ boilers
into subcategories defined by boiler type, capacity, and fuel type. Based on
this information, a source must meet emission limits, work practice standards
(including tune-ups and energy assessments), and operating limits, and/or
demonstrate initial/regular compliance. Whether the facility is considered to
be new or existing also will determine if it is subject to the varying work
practice standards and requirements. Sources also are considered new if they
switch from one fuel to another (primary or secondary) that is applicable under
the regulation. Below are some critical facts regarding the current Boiler MACT
standards, how they may apply, and what impact they could have for your
facility.

Area
Source Requirements

Area
source requirements (40 CFR Part 63 Subpart JJJJJJ) affect facilities with the
potential to emit less than 10 tons per year (tpy) of any single HAP, and/or
less than 25 tpy of combined HAPs. These regulations affect sources with
boilers defined as existing, new, or reconstructed.

This rule covers boilers burning coal, oil, biomass, or
non-waste materials, but not solid waste as fuels. This also includes natural
gas-fired boilers if they use fuel oil as a backup. All other propane or
natural gas-fired boilers are exempt from the area source regulations. Also,
depending on status and fuel type, there are emission limits for mercury,
particulate matter (as a surrogate for non-mercury metals), and carbon monoxide
(as a surrogate for organic air toxics).

Another aspect of this subpart critical for existing sources
is timing for compliance. All area sources considered subject to JJJJJJ were
initially required to comply with emission limits or an energy assessment by
March 21, 2014, and work practice standards by March 21, 2012. A Notification
of Compliance to work practice standards (including a boiler tune-up) is due to
the EPA by July 19, 2012. However, under the No Action Assurance Letter, the
EPA extended the compliance and notification dates for initial tune-ups after
several deliberations (and many companies already achieving the preliminary
compliance date). Facilities have been granted a No Action Assurance by the
USEPA. This does not require subject facilities to meet the originally-stated
compliance deadline of March 21, 2012. It should be recognized that biennial
tune-ups must be conducted no more than 25 months after the previous tune-up.

For new sources, compliance must be achieved upon commencement
of operations. This includes submittal (within 30 days after operation of
subject equipment begins) of a Notification of Compliance Status to these
standards. If you are required to conduct performance tests, you are obligated
to submit a Notification of Compliance to the EPA within 60 days of completing
the performance test. Tables are included below to provide a basic overview of
what needs to be completed to meet the area source standard for boilers. 

Major Source
Requirements

Major
source requirements (40 CFR Part 63 Subpart DDDDD) affect facilities with the
potential to emit greater than or equal to 10 tpy of any single HAP, and/or
greater than or equal to 25 tpy of combined HAPs. This rule includes boilers
and process heaters burning natural gas, fuel oil, coal, biomass (e.g., wood),
refinery gas, or other gas to produce steam. Unlike Subpart JJJJJJ, Subpart
DDDDD also includes natural gas/propane/clean fuel boilers. The requirements
contain subcategories with very specific requirements. Of the roughly 14,000
major source boilers and process heaters in the United States, 88 percent are
required to conduct annual or biennial tune-ups; and 12 percent are required to
meet emission standards if those standards are not already met. New and
existing natural and refinery gas units are subject to tune-ups every 2 years,
regardless of operating rate. Other affected boilers are subject to limits on
emissions of mercury, dioxin, particulate matter, hydrogen chloride, and carbon
monoxide, based on fuel type or combustion. Unfortunately, at the time of the
completion of this article, the final rule was not yet published. Therefore,
some of this information may change and should be confirmed before proceeding.
New proposals may see changes in the finalized version of the rule, to be
published later in 2012 or early 2013. Much of the outcome of this regulation
is seen to be determined by the outcome of the November 2012 presidential and
congressional elections.

Additional
Compliance Considerations

For
all subject facilities, both major and area source, certain boilers also must
demonstrate continuous compliance through stack testing, continuous monitoring,
recordkeeping, and reporting. In addition, facilities must submit initial
notification and a Notification of Compliance Status within several months
(exact numbers and dates will be solidified and included in finalized
standards). For area sources, an Annual Compliance Certification report is due
by March 1 of each year. Recordkeeping requirements can include permits,
continuous monitoring data, deviation reports, fuel use, performance test,
energy assessment reports, tune-up documentation, stack test data, and any
site-specific monitoring plans.

It is critical to check with your state regulatory agency
before rushing to comply with some of these area source regulations. For
instance, in Indiana, a facility would not necessarily be subject to the
regulation if that facility has boilers that primarily run on natural gas, with
fuel oil as a backup fuel source. The exemption applies if you use fuel oil at
any time other than in a period of curtailment or during periodic testing (less
than 48 hours within a 12-month period). A period of curtailment refers to any
time when gas is cut off and it is beyond a facility’s control (e.g., during a
natural disaster). If a facility in Indiana has an air permit and this is not
explicitly stated in that permit, it may be wise to pursue a permit
modification stating that fuel oil is a backup fuel used strictly during periods
of curtailment or during periodic testing. While this specific regulatory
nuance applies to Indiana, individual state regulatory agencies should be
consulted to see if a similar detail may be applicable to your facility.

A large point of concern for many facilities, both major and
area sources, is the prospect of completing an energy assessment by March 21,
2014. An on-site energy assessment consists of the following major points, to
be conducted by a qualified energy assessment professional:

 

– A visual inspection of boiler or
process heater system

– An evaluation of operating
characteristics of the facility, specifications of energy-using systems,
operation and maintenance (O&M) procedures, and any unusual operating
constraints

– Inventory of major on-site
energy-consuming systems using energy generated by the subject boiler(s)

– Review of architectural and
engineering plans, facility O&M procedures, logs, and fuel usage

– Review of facility energy
management practices and recommendations for improvement

– List of major energy
conservation measures

– List of energy savings potential

– Report detailing ways to improve
efficiency, cost of specific improvements, benefits, and time frame for
recouping investments

 

There are three primary types of energy assessment. For
facilities that use less than 0.3 trillion Btu per year heat input, an 8-hour
assessment is required. Facilities using 0.3-1 trillion Btu per year heat input
require a 24-hour assessment. The boiler systems accounting for 33 percent or
more of the affected boilers’ energy output will be evaluated to identify
energy savings opportunities discovered through a 24-hour energy assessment. A
24-hour energy assessment is an energy assessment that spans 24 technical hours
of a boiler/process heater in operation at a facility. Finally, for those
facilities using over 1 trillion Btu per year heat input, a 24-hour assessment
is needed. The boiler systems accounting for 20 percent or more of the affected
boilers’ energy output will be evaluated to identify energy savings
opportunities discovered through a 24-hour energy assessment.

There are many subtleties to these
regulations, and not everything is encompassed in this article. Also, there are
slight changes for these regulations on the horizon, including the number of
exemptions that exist for boilers at certain facilities. Clarifications and
additional information will be provided in a future article in 2013.

 

Figure 1
NIA Sites > Insulation Outlook Magazine > Global

ISO 50001: Guidance Documents Are on the Way

ISO 50001 is the first International Organization for
Standardization (ISO) standard for managing energy performance improvement. It provides a
standard methodology for a wide range of stakeholders industrial, commercial,
and institutional to establish systems and processes to manage energy and
improve energy performance transparently.

New Insights for
End Users

Since
the release of ISO 50001 in June 2011, many organizations have purchased the
standard, and some have achieved conformance. However, in some cases,
conformance has taken longer due to the need for clarity and interpretation
guidance on some provisions in the standard. To facilitate more rapid and
widespread adoption, the ISO Technical Committee that developed the standard
(TC242) has begun developing the companion guidance documents for utilizing ISO
50001. These documents will provide technical background and application
details intended to help stakeholders understand the full intent of the
standard.

Four separate working groups have been formed to expound on
different core subject areas related to ISO 50001. The intent is that the
resulting guidance documents?ISO 50002, ISO 17588, ISO 17570, ISO 17580, ISO
50003, and ISO 50004?will enhance end users’ understanding of ISO 50001,
provide guidance on its implementation, and maximize its potential benefits.

  • ISO 50002 will provide guidance
    on energy auditing. This document is the most advanced and is likely to come
    out first. It addresses principles of an energy audit including
    confidentiality, transparency, and the audit process. This guide includes a
    series of annexes that address different types of audits for industry, buildings,
    transportation, and services.

  • ISO 17588, 17570, and 17580 (which are temporary numbers, as the
    official document numbers have not yet been assigned) address selecting,
    establishing, and maintaining energy performance indicators (EnPI); their corresponding
    baselines; and measurement and verification. This is likely to include the
    steps in selecting EnPIs, developing baselines, characteristics of significant
    energy uses, and appropriate reasons to change a baseline. According to one
    member of the U.S. Technical Advisory Group, Joe Almaguer, “the guidance
    documents need to keep the end-user in mind to ensure its maximum effectiveness
    in helping organizations manage their energy performance and continually effect
    improvement.”

  • ISO 50003 will provide guidance
    on the conformity assessment of the Energy Management System (EnMS), which is a
    crucial part of successful conformance with ISO 50001. The document will
    specify the elements in the auditing process and competence requirements of
    personnel involved in the audit. This includes the audit plan, audit team
    selection, audit time, and audit report.

  • ISO 50004 will provide guidance
    on implementation, maintenance, and improvement of the EnMS that is created
    when an organization decides to adopt ISO 50001. This document will encompass a
    wide variety of topics including determining the scope of an EnMS, management
    responsibility, identifying significant energy uses, prioritizing improvement
    opportunities, competence of personnel, communication, documentation,
    procurement, monitoring, conducting internal audits, non-conformity, corrective
    action, and management evaluation of the EnMS.

Understanding How To Implement ISO 50001

Once
completed, the guidance documents will provide the necessary background and supporting
information to assist in applying ISO 50001. By addressing significant core
concepts within ISO 50001, the guidance documents will help industrial plant
personnel more effectively conform with the standard. They do not set new
requirements.

The guidance documents are expected to be published late 2013
to early 2014 and should be available on the ISO website.

 

Reprinted with permission from the Industrial Team
at the Alliance to Save Energy.

NIA Sites > Insulation Outlook Magazine > Global

Exploring Insulation Materials

Polyimide

Polyimide
(PI) insulation is defined by ASTM as lightweight, flexible, open-cell foam for
use as thermal and sound-absorbing insulation in commercial and industrial
environments. PI is manufactured as large rectangular buns, typically 4 ft wide
x 8 ft long x 5-30 inches tall, in a range of densities. Prior to actual
installation, buns are fabricated into various shapes, including flat sheets
and preformed pipe half-shells designed to fit over NPS pipe and tubing.
Complex shapes also can be fabricated to fit tightly around fittings, elbows,
and other equipment. ASTM material specification C 1482 covers PI insulation at
service temperatures from -328°F to +572°F.

ASTM
C1482 defines the requirements for density, thermal conductivity, acoustic
absorption, thermal stability, flammability, smoke density, smoke toxicity,
chemical resistance, corrosiveness, and mechanical properties. This ASTM spec
lists two grades and four types of PI foam, but the following three types are
most commonly used for commercial and industrial applications.

Key
applications for PI foam include thermal and acoustic insulation for HVAC and
industrial equipment, acoustic duct liner, high temperature pipe insulation,
and expansion joints for cryogenic facilities.

The
use of an appropriate vapor retarder is required in all applications where
condensation could occur. There are a wide variety of vapor retarders, both
films and coatings, that can be specified.

Figure 1
NIA Sites > Insulation Outlook Magazine > Global

“The Value of Distribution” Revisited

At
the National Insulation Association’s (NIA’s) 32nd Annual Meeting in Marco
Island, Florida in 1987, I gave a presentation on “The Value of Distribution.”
In April 1989, I participated in a one-on-one interview with Insulation
Outlook staff related to the distribution channel within the mechanical
insulation industry. The resulting article, entitled “More Than a Middleman,”
discussed the value of distribution. We thought it would be interesting to
revisit portions of that interview to see what (if anything) has changed over
the past 23 years. This article offers a discussion on what was relevant in
1989 versus the reality of today’s market.

How would you
portray or describe the role of distribution in our industry?

1989
Response:
Distribution in our industry, as in others, is the central link in moving
products from the manufacturer to the ultimate purchaser or customer.
Distributors provide an array of value-added services for both manufacturer and
customer, such as marketing, financial, and logistical support as well as
transportation, market, and product intelligence.

Distributors have been called the economy shock absorber
because of their ability to react to change?vital to our industry’s economy.
They make available the supply channel that provides the best opportunity for
manufacturers to overcome the considerable geographic problems of product
distribution, defining and servicing customer requirements, and maximizing
production capabilities while minimizing administrative and sales costs. Most
importantly, customers are provided enhanced service, choice, and availability
of product.

Today’s Response: While the basic role of distribution has not changed, the
importance of the distributors’ role in our ever-fluctuating economy has
increased tenfold. The “Distribution Commandments” listed in the 1989 article
are relevant today (see page 6). Each of these commandments has a value and
cost associated with it. There are many more insulation contractors, the
profile of what constitutes a mechanical insulation contractor has certainly
changed, and there are more companies self-performing work than there were in
1989. More product manufacturers are participating in the industry, and
consolidation has impacted all segments.

How did
distribution evolve in our industry?

1989
Response:
Distribution within the industrial and commercial insulation phase of our
industry was initially generally recognized as a supplement to the contracting
business. There were geographical and company variations; but, basically,
manufacturers sold direct to all contractors. Those contractors would resell or
distribute a relatively small volume of materials?thus, the term
“contractor/distributor.”

It wasn’t until the mid-1970s that distribution became a
recognized, distinct segment of the industry. Circumstances that influenced the
market included general contractors and owners who regularly self-performed
their insulation requirements, as well as the growth of the merit (or
non-union) segment of the industry.

Some criticized the distribution segment as an unnecessary
link in the marketing and administrative process. However, observation that
distribution continues to survive and thrive proves that distributors are not
parasites on the economic system.

Today’s Response: The
distribution segment has clearly matured and is recognized as an integral and
important part of the mechanical insulation industry. A few
contractor/distributors still operate in some markets, and there always will be
those who do not appreciate the value distributors bring to the business.

There are three primary reasons why the
contractor/distributor dual operating structure still exists: (1) certain
geographical markets are not economically or effectively covered by
distribution; (2) long-term relationships exist between the respective
manufacturer and contractor; and (3) there are specialty products that, for one
reason or another, have not been traditionally managed by distribution.

Some of the old problems still exist
with the contractor/distributor role. Generally, the contractor/distributor is
somewhat limited in the distribution arena by the ever-present concern over
competing with customers (i.e., “I don’t want to buy from my competitor”). In
addition, the contractor/distributor does not always account for or allocate
internally the cost of distribution services in the same manner as a standalone
distributor, potentially creating confusing external market intelligence and
misleading internal profit recognition.

Is the
distribution segment’s history problematic to some aspects of the distribution
business?

1989
Response: The
historical perspective still haunts the distribution segment. For example, many
contractor/distributors addressed warehousing, handling, and related costs as
an overhead burden associated with their contracting operation. They therefore
sold materials at or below cost relative to the actual cost of a transaction.
Broken cartons, return of merchandise, delivery, etc. were treated in a similar
fashion. Unintentionally, this had the effect of “spoiling” the customer so
that the distributor is continually trying to educate customers as to the cost
related to the services to which they have grown accustomed. The educational
process may require years to complete.

To add to this confusion, some contractor/distributors still
insist on continually or sporadically buying direct from manufacturers.
Although many manufacturers have abandoned their distribution function,
some?for legal, moral, or other business considerations?service that request,
which creates market fragmentation, confusion, and frustration for all parties
involved.

Today’s Response: As in 1989, industry fragmentation and marketplace confusion
results from the practice of some manufacturers of specific product lines
selling to contractors direct and supporting distribution, which further
complicates a complex multi-channel approach to the market. History may be
responsible for shaping many of the service practices, but the core structure
and makeup of the industry as it has evolved demands many of the service
practices.

Many mechanical insulation contractors are small businesses
that employ fewer than 5 to 10 people and are not capitalized to afford any
significant level of internal managed product service. Mechanical insulation is
by no means the core business for some companies. Accordingly, they require
product services. I would suspect that the majority of contractors employ their
capital to support their contracting operations versus the project product or
distribution requirements. Add to that the endless range of insulation system
variations, plus the reality of project management today, and the need and
value of distribution in our industry is of greater value than ever before.

Many distributors
also fabricate or perform other value-added services. Is that a benefit?

1989
Response: Value-added
services, like products, have a life cycle. If a specific service is performed
by few companies, it can be used as a point of differentiation. If it is
performed equally by many, it is mature and perceived as providing less value,
likely making it less profitable to the distributor/fabricator. Value-added
services can be measured in distinct phases that characterize value to the
customer, manufacturer, and the distributor/fabricator.

The initial phase is when a new service, which may require a
considerable amount of investment but provides little marketplace value, is
researched and developed. As the concept becomes acceptable, its cost is still
relatively high. However, it provides a useful service, making it a valuable
sales and marketing tool for the customer, manufacturer, and
distributor/fabricator.

As the concept is perfected and accepted in the market, cost
may be reduced and/or recovered. At this stage, it still has high marketplace
value, since relatively few competitors have adapted the same value-added
service.

Inevitably, however, there are few things competitors cannot
adapt to their own company with the help of customers and/or manufacturers.
When this happens, the service becomes almost like a commodity or a necessity
to keep up with the competition. It provides very little, if any, marketplace
advantage.

I believe the vast majority of the large, commodity-type
fabrication or value-added services performed by distributors/fabricators in
our industry are in the more mature phase of their life cycle.

Distributors/fabricators need to keep a steady pipeline of
new value-added services for competitor differentiation and return on
investment. If a service truly adds value, at least a portion of that cost
could be passed on to the customer or manufacturer. Value-added services are
often bungled, however, and the service and its value are lost in the sale.

Value-added services should have a higher gross margin than
the product itself. Although it may be impractical to separate the product and
service in setting prices, distributors/fabricators must ensure they are
adequately communicating the value of service to the customer and manufacturer
in the selling and purchasing functions, respectively.

Today’s Response: The 1989 observations are still valid, although insulation
fabrication represents a larger segment of the market today. Many more
products, or combinations of products, are included in value-added fabrication
services now; and more companies perform some degree of fabrication off and on
project sites than ever before. Fabricators are continually focused on quality,
production efficiency, and service superiority?all of which lead to competitive
differentiation. Fabrication is probably one of the best examples of a
value-added service in our industry.

The customer profile of the industry
today versus 1989 is creating the need for more value-added services, and the
benefit of those services is increasingly relevant. We can expect that trend to
continue and the scope of services to expand.

What would be
another example of a value-added service? For instance, do distributors sell in
less than full carton quantities?

1989
Response: Yes, I
believe the majority of the distributors do. However, I feel sure the vast
majority wish they did not. Quite obviously, anytime you break a carton, that
action creates administrative, inventory management, product damage, etc.,
complications.

The practice of breaking cartons, and the related cost, is
going to become an even more complex issue in light of the Occupational Safety
and Health Administration Hazard Communication Standard and the compliance
issues related to packaging and labeling.

Breaking of cartons is a value-added service. However, it has
fallen into the category where the true value is not appreciated and has become
somewhat standard to meet competitive pressures.

Today’s Response: With rare exception, breaking of cartons on many products
has become standard operating procedure and the value of that service is not
recognized. The customer profile of the industry, coupled with the project
management practices, almost mandates that approach.

Generally, less storage space is available on new projects;
or in maintenance applications, release quantizes?or in some cases, the scope
of a release?are not known until the last minute, and potentially the
contractors’ capital restraints make broken cartons a necessity. Breaking
cartons is not complex, but it can be costly. It was disappointing in 1989, as
it is today, that the industry does not recognize the value of that service.

When you think of
distribution, many business issues come to mind. For example, what is your
analysis of inventory levels and mix? Are they a problem?

1989
Response: Inventory
levels and the mix of inventory are always a problem. Recently, an associate of
mine said, “You should think of inventory as money and not as boxes of
product.” That says it all. If salesmen had their way, you would maintain at
least one of everything to ensure securing the order and same-day delivery.
That’s just not economically feasible in today’s competitive business
environment.

Distributors are always faced with the dilemma that if it is
not on their floor, but on their competitor’s floor, they may lose the order. This
competitive pressure may be diametrically opposed to effective economical
inventory management, but that doesn’t necessarily justify making a bad
inventory decision.

The problem is further magnified by the short lead time that
is becoming more predominant between bid, award, and project mobilization. This
situation has become more pronounced in the last few years than at any other
time in the history of our industry.

In-depth evaluation would probably exhibit that 25 to 40
percent of a distributor’s inventory is not economically justifiable based upon
inventory turns, floor space, handling cost, etc. versus the profit margin
obtained. A portion may be justifiable due to specific customer demands,
economics of purchasing, fulfilling a product line, market development, future
requirements, and/or other unique situations. However, in reality, after all
those considerations, a substantial percentage is attributable to product
returns, over-buying, reaction to customers’ “guesstimated” needs, pressure
from the manufacturers, obsolescence, bad judgment, and/or some combination of
the above.

Recognition of these facts and development of a continuous
hands-on approach to inventory management is a necessity to correct the problem
and avoid reoccurrences. However, equally important is communication with the
customer and the manufacturer. It is a delicate balance between customer
service and inventory management that must be realized by people at all levels
of the company, including sales and service personnel.

Today’s Response: Distributors appear to be doing a better job with inventory
management today than in 1989, but the core problems remain.

One of the traps that many fall into is examining total turns
versus detail product line, or even individual stock-keeping units (SKUs). A
company may have total turns of seven, which is considered good in most
circles. But that does not mean everything is turning seven times. Half of the
inventory could be turning once and the other half 13 times. That is an extreme
example, but it illustrates the point that detail analysis is needed.

Everyone in our industry who is in the inventory management
chain, or has influence on inventory levels or mix, needs to fully appreciate
that inventory is real dollars disguised as mechanical insulation.

Customer communication also is vital to successful inventory
management. Customers need to appreciate lead times and plan their orders and
delivery request accordingly.

Defining a good turn level is really dependent upon each
distributor’s customer’s demands, mix of products, lead times, and a host of
other items. As a general rule, though, a good total level turn range is
between seven and nine turns.

How about
accounts receivable, or “days outstanding” as it is commonly referred to?

1989 Response: Accounts receivable is the most
important but probably the most frustrating asset the distributor has to
manage. Nothing is more disturbing than being confronted with the write-off of
receivable dollars. You may want to trust and believe in everyone, but, like so
many other things, the legal and judicial system, coupled with the fact that
some people try to abuse your trust and belief, ruin the system for the
majority.

In my opinion, credit will become more difficult and
collection efforts and the resulting legal maneuvers will intensify. Honest and
continual communication and mutual understanding are the only things that can
ease that pressure.

Purchasers (customers) must understand that distributors are,
in essence, banks from which they are asking for a short-term revolving line of
credit. Distributors may have more flexibility than a bank, but their exposure
is identical.

If you need a line of credit from a
bank, you go to its offices, explain your needs, discuss and present your
financial statements, and negotiate such items as collateral, interest rates,
payment terms, etc. Why should the distributor be any different?

I have seen customers become irate when
you try to discuss credit worthiness using credit criteria similar to that of a
bank. However, they provide a credit card company with more information than
you are asking them to provide. Customers should appreciate that a distributor
can be their biggest ally if they timely communicate their needs. Likewise, a
distributor’s credit department can be a big asset to a customer and to the
distributor by understanding the business and working with the customer while
protecting the company’s position.

I believe the future will see shortening of credit terms,
which will result in the reduction of days outstanding for the distributor. It
is not likely to happen quickly, as change of credit terms will probably meet
extreme customer resistance. Through a closer relationship with the customer,
improved billing techniques, and increase in discounts tied to payment,
significant gains can be realized. Offsetting some of these gains, however,
could be the increased use of receivable terms as a promotional tool for key
accounts.

Today’s Response: The basic struggle has not changed. Accounts receivable is
just like inventory: capital dollars required to run the business. Distributors
have become more stringent in establishing and managing credit limits, and
enforcing collection; but the customer’s expectations have not changed.
Likewise, I think the majority of purchasers have a greater appreciation for
the value of maintaining a good credit history and the consequences of not
abiding by agreed-upon terms.

Is data
processing playing a major role in distribution? What sort of automated
innovations would be the most productive?

1989
Response: I believe
the distribution segment in our industry has, unfortunately, lagged behind many
other industries in adapting data processing technology in their businesses.

The major reasons for non-implementation or use of advanced
data processing technology have been lack of management commitment,
organizational or operations personnel resistance, and insufficient technical
knowledge and funding or commitment (probably the most difficult issues to
appreciate). With funding and commitment, the other reasons can be
appropriately addressed.

Bar coding/scanning offers great potential for the
distribution industry. Although the future of bar coding/scanning is exciting,
the lack of standardization is a key barrier that must be overcome before
scanning can be effectively and productively used by distributors.

The biggest question is: Who will take the lead in developing
the standards and systems to link participants in the pipeline as it pertains
to bar coding/scanning and/or customer/supplier links?

Today’s Response: Unfortunately, industry standardization has not occurred.
Most distributors are setting specific priorities and pace of implementation of
technology practices. I think our industry’s distribution segment is still
lagging in the use of technology in comparison to many other building product
segments. Our industry has some unique practices, but that should not deter
implementing the use of proven technology that would improve operational
efficiency and profitability.

What about trucking
or delivery cost?

1989 Response: Delivery is a vital and necessary
function the distributor must and should provide. It is a value-added service.
However, realization of the cost related to this service has gotten lost
somewhere in the maturing process of the industry.

If distributors accurately determined delivery cost, they may
be truly surprised as to the net gross profit or margin on a specific order or
customer. Make your people aware of the cost and, equally important, make your
customer aware. You may be able to tell your customer you could reduce your
price if you handled their delivery requirements in a different manner. You may
be surprised by the customer’s reaction. I cannot think of a single customer
who would not be interested in possibly helping to reduce your cost if it
subsequently reduced their cost and met their needs.

Today’s Response: Delivery is more
important than ever, and the cost in comparison to 1989 has easily doubled due
primarily to increased fuel cost. Even with fuel surcharge begrudgingly
accepted, the actual cost of delivery continues to be frequently overlooked.
Logistical, delivery patterns, and cost-versus-margin analysis should be
routine for a distributor; and the financial impact of the delivery service,
pro or con, should be communicated to the customer. Delivery continues to be a
major value-added service, and the customer needs to be involved in helping to
manage the cost and carrying the ultimate cost burden for the expected service.

In addition to
the operating concerns you share with the many sectors of the industry, there
are other issues of importance. For example, much has been written about the
need for vendor’s liability endorsements and/or indemnification. Does this
apply to the distributor?

1989
Response:
Absolutely, this applies to the distributor. The distributor sells to virtually
all phases of the industry, and if a problem were to develop, the distributor
could be besieged with the same degree of lawsuits as the manufacturer. There
are many misconceptions concerning the meaning and importance of vendor’s
liability endorsements and/or indemnifications. It is up to the distributor to
evaluate the merits of each.

One of the most costly items in
defending any product liability lawsuit is the legal cost associated with that
defense. Providing both vendor endorsement and indemnification allows the
distributor and the manufacturer to be on the same team, possibly through one
defense, which reduces overall legal costs and possibly eases the adversarial
relationship between the plaintiff and the distributor/manufacturer.

I am sure that after extensive evaluation many vendor
endorsements may be worth more than specific company indemnifications, but the
distributor has no way of evaluating that without continual review of insurance
policies and manufacturer financial statements. When the manufacturer provides
both, it tells the distributor that the manufacturer stands behind its product
to the full extent of the value of the company; eliminating any question as to
the value or sincerity of insurance coverage or company worth.

This is an extremely sensitive subject with many
manufacturers. However, distributors are not the manufacturers of the product.
Distributors should be held accountable for following safe and recommended work
practices, but they should not be held liable for health hazards or other
issues related to a product they do not manufacture.

Today’s Response: The sensitivity and importance of the subject has not
changed; and the complexities, if anything, have increased. This subject is
best handled by the companies’ insurance and legal departments, but it needs to
be addressed and not ignored by the distributor or manufacturer.

What are some of
the other concerns of the distributor? For example, what about employee benefit
cost? How does it compare to the contracting phase of our industry?

1989
Response: The
problems of rising benefit costs, government regulations, administrative
burdens, etc., are not unique to the contracting phase of our industry. The distributor
is faced with the same issues. I have always been a firm believer in providing
as many benefits as economics and practicality would allow; but the direct and
administrative cost, and the liability, have become so prohibitive that I don’t
know how a contractor or distributor can continue past practices, especially in
light of proposed legislation that may mandate benefit programs.

Group insurance cost is literally increasing at such a pace
that I don’t think the average company or employee can continue to participate.
The sad thing is, you can’t afford not to. It is not unusual to hear of
increases ranging from 100 to 300 percent while coverages are decreasing.

It is a problem for all industries. Our industry is no
exception, and the distributor is not exempt. This problem will continue to
escalate and could become increasingly important when attempting to maintain a
stable workforce and provide employee motivation.

Today’s Response: The cost of health insurance has escalated to a point where
to maintain competitiveness and profitability, all benefits are being reduced
or the costs passed onto the employee. All segments are being affected. The
long-term impact on individuals, families, and the economy of reducing or
dropping health insurance coverage, reducing or eliminating 401(k)
contributions, and similar actions has yet to be determined. Without question,
due a host of issues ranging from governmental regulations to the United
States’ and global economies, the workplace environment has changed. More
responsibility is being put on individuals to plan for their future without the
financial support or guidance of their employer(s). Unfortunately, the concerns
expressed in 1989 have become reality.

You have stated
in several editorials that the profit or return on investment in our industry
is relatively small in comparison to the risk. Does that apply to distribution?

1989
Response: Yes, I
believe it does. The attractiveness of an investment is primarily based on the
balance between its inherent risk and expected return. The higher the risk, the
higher the expected return. Some aspects of distribution make it less risky
than other investments, while others make it higher risk. In my opinion, the
distribution industry carries a slightly higher risk than the medium-risk
investments in today’s economy. Consequently, the return should be somewhat
higher.

Typically, a distributor’s balance sheet may reflect that 70
to 80 percent of its assets are a mixture of accounts receivable and inventory.
I cannot think of two more risky categories, especially in light of today’s
legal system, product liability, and the intensity of competition in our
industry.

When you compare distribution in our industry with other
industries, you discover that although the risks are very similar, the net
pre-tax earnings in our industry historically average below those of other
distribution businesses.

This condition can be related to the fact that distribution
in our industry is relatively young and has yet to be fully respected by all
phases of our industry. This increases and intensifies the competitive issues.
I am extremely hopeful that the future will increase profitability in
relationship to the risks.

Today’s Response: The distribution channel in our industry has proven its value
and continues to prosper. For reasons ranging from management practices to
maturity of the distribution channel in the industry, to customer and product
profile changes, etc., bottom-line profitability within the distribution
segment of our industry has increased. Whether it has increased to the level of
acceptability in comparison to the risk and investment is debatable.

Many distributors have diversified their product offering
outside the mechanical insulation industry, added value-added services, and expanded
their geographic reach by opening new grass-root centers. Consolidation also
has impacted the distribution segment. All of these changes, and others, have
had some influence on the distribution channel.

Beginning in the late 1990’s, private equity began investing
in the industry’s distribution channel, which has since increased
substantially. The discipline and philosophy that private equity brought to the
industry has been the catalyst for the majority of the consolidation efforts.
With today’s low cost of money, private equity has lowered the hurdle rate or
return expectations, which may continue to drive consolidation efforts for the
next several years. Those efforts also may lead to increased product offering
and diversification by the traditional mechanical insulation distributor.

We’ve discussed
the near future, but what long-range trends do you foresee?

1989 Response: Many experts indicate the world’s
business outlook continues to be manufacturer-oriented, even though our general
economy clearly is evolving into an information society where service
industries rival manufacturing industries. Distribution is based upon
information and service. Distributors are not just “middlemen,” existing in a
parasite relationship with manufacturers. Distributors are or will be
recognized as full partners to manufacturers and the world economy.

Louis Dehmlow wrote in his book, Superconductive Ideas, the
following comments about distribution:

“Our forefathers were the men of
commerce and trade. They drove the camel caravans and sailed the ships at sea
as the Phoenicians did three thousand years before the birth of Christ.
Manufacturers, by contrast are newcomers, they appeared a mere 250 years ago
when new technologies and inventions were making possible the industrial
revolution.”

So we are not the stepchildren of manufacturing or simply
another ?service industry.’ We have a noble history of our own and a leadership
role in shaping the future. The Encyclopedia Britannica says that, “commerce
began where civilization began.” We were there. We can be entrusted with the
unlimited dreams of youth, because, even with our long history, we still
represent unlimited possibilities.

I believe that summarizes the future of distribution in our
industry. Despite the complexities and day-to-day frustrations, the industry is
maturing, growing, and prospering, and will continue to be a vital phase of our
overall industry.

Today’s Response: I think that
still summarizes the future of distribution in our industry. The distribution
segment will not be without its challenges, but it will continue to prosper and
be a vital contributor to its customer base and supporting manufacturers.

With consolidation and diversification leading the way, and
an increasing and changing customer base, I expect the industry distributor
profile to look substantially different in the next 5 to 10 years. The core
values of distribution?the value of distribution?I do not expect to change. The
value of the manufacturer and distributor relationship will continue to
strengthen and become more strategic and tactical in their mutual planning
initiatives. Distributors will look to strengthen and expand their customer
relationships as they drive for sustainable and profitable growth.

The mechanical insulation industry and the distribution
segment have an exciting future.

 

The
1989 Distribution Commandments

1. Thou shall do the buying

2. Thou shall sell the product to thy neighbor

3. Storing the product will be thy task

4. To thy customer thou shall transport the product

5. Thou shall aid and comfort thy customer by financing

6. Risk-bearing will be thy covenant     

7. Thou shall keep abundant market information

8. Thou shall provide product service
to those in need

 

NIA Sites > Insulation Outlook Magazine > Global

Life Cycle Assessment—an Insulation Products Perspective

“Science is 1 percent
inspiration and 99 percent perspiration.”

Despite the fact that the
above quote was recorded by Albert Einstein prior to the conception of the idea
of Life Cycle Assessment (LCA), it provides a perfect lead-in to this article.

The evolution of a social media-driven society has expanded a
demand for the “dumb it down” approach to explaining everything. For product
manufacturers, this is especially evident in the overabundance of
single-attribute certification programs and rating systems criteria popping up,
as well as recent attention given to the alarmist hazard-based approach. Each
of these is meant to serve the purpose of providing a convenient, yet narrowly-focused
definition of “green.” Environmental science, though, involves comprehensive
consideration of complex interactions of physical, chemical, and biological
processes. As a result, rendering judgments based on limited perspective (such
as a specific quality and/or life cycle stage of a product), opens the door to
increasing probability of unintended consequences from the broader viewpoint of
sustainability.

LCA is a technique developed for the purpose of understanding
and addressing the environmental impacts of products, processes, or services.
It involves quantifying and interpreting the energy and material resource
inputs, along with the environmental consequences of outputs, throughout a
product’s life cycle from raw material extraction to end of life
(cradle-to-grave). LCA is a science-based and holistic analytical method that
includes the
compilation of the consumption of energy and raw materials, as well as the
releases to air, water, and land. 

As a result of recognition of its rigor and thoroughness,
along with the development of international standards that have improved its
utility, LCA has emerged as an essential tool in the evaluation of environmental
impacts associated with products. This recognition is particularly evident in
the building and industrial construction community where designers are
increasingly interested in the life cycle profile of the products and
assemblies that are being incorporated in specifications. As a result, it is
critical that the manufacturer, specifier, and user of insulation products grow
familiar with the LCA concept.

The purpose of this discussion is to provide overview
information regarding the key aspects of the LCA concept. The basic framework
for conducting an LCA study and a description of the established mechanisms for
effectively delivering the results, both internally and externally, are
included. The reader will find that the focus of much of the information is
building envelope thermal insulation, where substantial efforts have been
devoted in recent years to the credible representation of sustainability
through the LCA tool. It can be noted that a close connection can be
established between these efforts and initiatives to define the life cycle
profile of mechanical insulation products.

Development of the LCA Technique

Most are surprised that
the LCA concept has been discussed and applied for several decades. It has been
widely accepted for many years to provide a holistic perspective of
environmental impacts and, therefore, facilitate product development and
innovation, as well as comparisons of product systems that fulfill the same
function. However, with its foundation on detail and completeness come
challenges in its application. These include data collection consistency,
assumption development, and data availability limitations to all stages of the
life cycle by the LCA practitioner, just to name a few.    

Technical committees of the International Organization for
Standardization (ISO) have prepared and updated documents for membership
approval for the purpose of standardizing aspects of the LCA technique. These
aspects include everything from establishing principles to delivering results
in a reliable and comparable fashion. This evolving and continuous maintenance
process is intended to address the challenges discussed above and establish
requirements that achieve global alignment with the application of the
technique while providing flexibility to focus on critical regional and product
system-related environmental impact issues.

Conducting an LCA Study

The
ISO standards internationally recognized for the purpose of conducting an LCA
are ISO 14040 1 and ISO 140442. The former establishes
the principles and framework of the LCA study, while the latter establishes its
requirements and guidelines. These standards state that “LCA addresses the
environmental aspects and potential environmental impacts?” and that an LCA
study is an iterative process involving four phases, as depicted in Figure 1
(ISO 14040) and described below.

1. Goal and scope definition

An LCA project begins with
the development of a concise statement of the objective for conducting the
study. This includes its intended use as well as who would be the target
audience for communicating the results. If the study is meant to be part of a
comparative assertion that will be disclosed to the public, the standard states
that the disclosure of such purpose shall be included in the definition of the
goal.

The value achieved through the execution of a credible LCA
lies in its characteristics of transparency, rigor, and thoroughness.
Therefore, an explicitly defined scope that describes the breadth and detail
required in order to adequately address the defined goal is critical. In
addition to providing the user of the results with a crucial understanding of
the context, the scoping serves as a blueprint for conducting the study. Key
aspects of the scope are the establishment of the functional unit and the
system boundary (see the glossary inset). It is useful to describe the product
system with a flow diagram illustrating each of the unit processes within the
system boundary and their relationships with one another. Examples of details
that are to be included in the definition of the scope are the study’s types
and sources of data, assumptions used, and limitations.

2. Inventory analysis

The “guts” of the LCA is
the data, and this phase of the process involves its collection and analysis.
The term that describes the data is the life cycle inventory, LCI. After
establishing a flow diagram representing the entire product system, the LCI
analysis involves the compilation of inputs to and outputs from each process
stage of the system boundary. The inputs must include all water and raw
material requirements, as well as the embodied energy of these raw materials
and additional energy associated with completing each individual process stage.
The outputs are all releases to air, land, and water. It should be noted that
transportation requirements between each stage are to be included.

Clearly, insulation supply chains can
involve dozens of specific processes and hundreds of flow inventories.
Therefore, data collection efforts likely will require the cooperation and
project goal understanding of raw material suppliers and perhaps upstream
entities. In addition, regional differences occur as a result of matters such
as energy conversion and material sourcing, which must be considered in the LCI
analysis.    

3. Impact assessment

The third phase is life
cycle impact assessment, LCIA, where the aim is to evaluate the LCI results to
gain an understanding of the magnitude of the product’s potential life cycle
environmental impacts. In order to achieve meaningful results, the ISO standard
establishes mandatory elements of the LCIA. The first element is the selection
of the classifications of environmental concerns, or impact category(ies); the
representation of each category, category indicator; and the models employed to
establish corresponding characterization factor(s) applied to the LCI analysis
results. This selection process must be consistent with the goal and scope of
the LCA project. The second element is the classification step, or the
assignment of LCI results to specific impact categories; and the third is
characterization, through the calculation and summation of category indicator
results.   

4. Interpretation

In the interpretation
phase, the results of the inventory analysis and impact assessment are
evaluated. Consistent with the defined goal and scope, the findings from these
evaluations are presented in the form of conclusions and recommendations. In
addition, limitations are to be identified and explicitly explained.

The evaluation in this final phase involves utilizing reams
of LCI and LCIA data and raw results with the goal of meaningful conclusions,
limitations, and recommendations, while achieving alignment with the
established goal and scope. This is clearly a daunting task. Not that it makes
it any less daunting, but ISO 14044 provides a framework for crossing this
canyon. This framework begins with identifying issues of significant magnitude
and importance. The evaluation process then moves to a series of assessments
regarding data quality, results consistency, and sensitivity of assumptions.
The credibility of the LCA study rests heavily on the level of due diligence
applied here. As indicated in Figure 1 with the opposing arrows to and from the
interpretation phase and each of the other three phases, this is an iterative
exercise.  When a check discloses a flaw with the results, it is necessary to
go back to the calculations, assumptions, data sources, etc., and make the
necessary changes. At times, it may be determined that an identified gap
requires that the goal and scope definition be modified.

This final phase is the transition from the meticulous detail
and complexity involved in conducting an LCA to the application of its findings
for problem solving and decision-making. The successful LCA study is one that
is credible, transparent, and presented to the targeted audience in an
easy-to-understand fashion. This is particularly important when the intention
of the study includes comparing the LCA profile of the product studied to
competitive products performing the same function.

Final Report and Critical Review

Presenting results and conclusions
thoroughly and accurately to the target audience is a vital aspect of the LCA
concept. Section 5 (Reporting) of ISO 14044 provides explicit guidance on the
context requirements for reporting information from the study. Details shall be
included on all elements of the four phases with the purpose of providing
transparency to the reader regarding the execution of the study. In other
words, to establish the legitimacy of the conclusions in the eyes of the
reader, it is necessary to provide full disclosure of such matters as:

 

– The data and methods utilized and
why

– The assumptions made and why

 

As is the case with all aspects of the
study, the final report shall be structured in a manner consistent with the
goal and scope.

Despite the best intentions, commitment, and painstaking
efforts of the party sanctioning the study and the LCA practitioner executing
it, there still could remain a question in the viewpoint of the target audience
or other affected stakeholders (such as manufacturers of competitive products)
as to its legitimacy. Although not necessarily a means of fully overcoming
these doubts, the critical review process is intended to provide external
expert and unbiased perspective to the means at which the study was conducted.
ISO 14044 states the following:

 

“The critical review process shall
ensure that

– The methods used to carry out the
LCA are consistent with this International Standard,

– The methods used to carry out the
LCA are scientifically and technically valid,

– The data used are appropriate and
reasonable in relation to the goal of the study,

– The interpretations reflect the
limitations identified and the goal of the study, and

– The study report is transparent
and consistent.”

 

Under the ISO standards, a critical review is not a mandatory
requirement unless the study includes comparative assertions and will be
disclosed to the public.

A critical review panel is composed of a minimum of three
members, with one of the members assigned as the chair. It is appropriate for
the party sanctioning the study to select the chair, who will select the panel
members based on the goal and scope. Considering the broad-based analyses
involved in an LCA, it is important to select a panel with a diversity of
pertinent expertise. For instance, in the case of an insulation product LCA, it
is prudent to select at least one panel member with knowledge of the insulation
industry and markets.

The review process involves examination of the data,
methodologies used, and all background information of the study by the panel.
As a result, agreements of non-disclosure of proprietary data and information
between the party sanctioning the study, the LCA practitioner, and the members
of the panel are often executed. Following the panel’s initial examination, the
chair will typically request additional information, clarification, and,
perhaps, initial recommendations for changes. After the panel receives
responses, this process is repeated until panel members are comfortable that
they have fulfilled their purpose. The details of the exchange between the
panel and the LCA sanctioning party and practitioner are to be recorded in the
final report and made publicly available.

Product-Generic LCA

The substantial commitment
of resources required of the manufacturer initiating a full grass roots LCA
program for a portfolio of products can present a rationalization challenge. As
a result, consideration of a collaborative industry effort is prudent. The
potential for synergistic advantages is particularly high for generic products
with similar market property requirements and end-use applications, such as
individual insulation materials.

Typically, such an endeavor would be
initiated and conducted through the trade organization representing the
product(s) involved. Following the establishment of an initial project mission,
the assurance of a universal commitment by the participating product producers,
as well as their raw materials suppliers, is paramount. An important
preliminary action would be initial research on the availability and apparent
quality of updated inventory data for the key raw materials. As with an
individual company-based LCA, it normally makes a great deal of sense to hire
an outside expert to perform the actual study. LCA practitioners have the skill
set to conduct it efficiently and credibly. In addition, it is essential that
there is industry expertise providing project oversight and direction.
Therefore, it is advisable that trade organization staff or a member volunteer
be assigned to manage the project.

Once completed, and critically reviewed if possible, numerous
options for effective utilization are available to the organization and its
producer participants. For instance, an individual producer can use it to
develop its own LCA profile, saving substantial time and money in the process.

The Many Applications of LCA

In examining the mass and
energy flows from a cradle-to-grave standpoint, one has opened a wide array of
possibilities for better understanding, exhibiting, and improving the
environmental aspects of a product(s). LCA is a tool that can be used for both
internal and external purposes. As discussed in the Goal and Scope Definition
phase of Conducting an LCA Study, though, it is essential to start the process
by deciding its “intended use as well as who would be the target audience for
communicating the results.” This section provides a brief description of the
mechanisms for sharing LCA results with various internal functional
organizations and external stakeholders.

The potential utility of an LCA study
for internal purposes requires understanding and engagement by several
functional groups within the organization. When leveraged as a core aspect for
operations and product development functions, the LCA results can play a
valuable role in advancing process improvements and product innovation. Also,
the cradle-to-grave perspective of the LCA tool provides insight into the
impacts of upstream processes and can contribute to an effective vendor
management program. In providing a foundation for a corporate sustainability
program, the development and maintenance of LCA profiles for a company’s
product portfolio is invaluable, if not essential. Armed with this detailed
knowledge of the environmental aspects of your company’s products and their
processes, reliable benchmarking against similar industries and competitors can
be achieved.

Incorporating
life cycle thinking into internal initiatives can have a positive impact on
market image and position. The use of this science-based, holistic approach to
representing and advancing environmental stewardship can provide positive
reinforcement to customers, stockholders, and the community. In addition, LCA
results play a role in validation of regulatory compliance, such as substance
emissions reporting.

 There are several mechanisms for delivering life cycle
information outside of a company or industry. The most common is marketing
literature, where specific environmental aspects of a product are promoted in
order to highlight its benefits. Special considerations are often involved when
it comes to representing these aspects in either business-to-business or
business-to-consumer communications. Frequently, an organization wishes to make
claims that require a higher level of validation, transparency, and/or consistency
of representation. An example would be any case in which the claim would
include a comparative assertion. As a result, the external representation of
the LCA profile of a product or product system is best served through a
standardized process. Public or commercial databases and Environmental Product
Declarations (EPD), which are described in the next section, are emerging as
delivery mechanisms in the United States.

The National Renewable Energy Laboratory (NREL) manages the
U.S. Life Cycle Inventory Database 3, a publicly available
repository of LCI data that is collected and analyzed through similar methods.
Software tools offered by Athena®, EcoCalculator4, and
Impact Estimator5, are commercial LCA database tools for building
designers. The EcoCalculator provides a quick snapshot of the environmental
footprint for numerous pre-defined residential and commercial assemblies. The
Impact Estimator is a whole building tool for design teams to examine the
environmental impacts of various material and building product system choices.

Recently, the LCA concept is frequently
utilized to rationalize public policy in the sustainability arena, and
LCA-based threshold criteria are more commonly cited in defining policy
provisions. This is particularly evident in emerging green building standards
and codes, as well as sustainability product certification and green rating
systems, namely Leadership in Energy and Environmental Design (LEED).
Information on specific green building policy is provided later in this article.

Environmental Product Declaration

An important aspect of
environmental management is labels and declarations. These tools communicate
one or more characteristics of a product in terms of its environmental impacts.
A producer may utilize these tools in order to influence purchasers to make
decisions in favor of the company’s product. Therefore, they are intended to
expand demand for product through continuous improvement from an environmental
impact perspective. To ensure their usefulness, the information provided
through these tools must be accurate and verifiable. To facilitate development
of representative labels and declarations, ISO established a series of
standards starting with general principles in ISO 14020 6 and
including ISO 14025 7, establishing the procedures for EPDs. Also
relevant to this discussion is the market segment-specific standard, ISO 21930 8.
This standard supplements ISO 14025 by providing additional framework for
developing EPDs for building products.

The standards define an EPD as:

“Providing quantified environmental
data using predetermined parameters and, where relevant, additional
environmental information”

and state its purpose to be:

“Present quantified environmental
information on the life cycle of a product to enable comparisons between
products fulfilling the same function”

An EPD is based on LCA/LCI information, and the
“predetermined parameters” are set forth in ISO 14040 and ISO 14044. In other
words, EPDs present information from ISO-compliant LCA studies in such a way as
to provide the reader with a meaningful comparison of products that serve the
same purpose. To this end, ISO 14025-compliant, certified EPDs are founded on
transparent methodology and validated data, along with consistency in
presentation of results.  

There are core elements of the procedural requirements of ISO
14025 and ISO 21930 that are important to note and understand. The first is the
selection of the program operator: the individual or organization contracted to
conduct various components of the EPD. The level of involvement by the program
operator in taking the project from a validated LCA study to the registration
and publication of the EPD is a matter of contractual agreement with the
client. However, the standards are explicit regarding the components that the
program operator must perform to achieve compliance.

Another element is the establishment of a functional unit.
The product system for the EPD being developed performs a primary function. The
functional unit is the amount of the product needed to perform a specified
level of that function. Of course, the function for insulation is resistance to
transfer of heat, so the functional unit is the amount required to provide a
certain R-value. This unit is the subject on which all the information in the
EPD is based and serves a convenient means of comparing products. A special
element for building products introduced through ISO 21930 is reference service
life. As the name suggests, this is the expected life span for the product
under in-use conditions. If the reference service life of a product is less
than the design life of the building, the number of replacements necessary over
the building life must be identified. This exhibits the importance of
durability of a product or assembly in the life cycle profile.

One last core element of EPDs to discuss here is that of
product category rules (PCR). In addition to the broad-based guidelines and
requirements presented in ISO 14025 and ISO 21930, there is a need to establish
a set of additional “rules” that are unique or customized to relevant aspects
of the “product category” before the EPD can be developed. A product category
is a group of products that serve equal functions, such as mechanical
insulations or building envelope thermal insulations. In such case that an
appropriate PCR is not available, effort must be made to involve a broad range
of stakeholders in the establishment of a harmonious, consensus-based, and
openly available ISO 14025-compliant document. An example would be the Building
Envelope Thermal Insulation Product Category Rules, developed by the Insulation
Coalition and verified and registered by UL Environment as the Program Operator
9.

Use-Phase Benefits

In conventional LCA
studies for durable building products, environmental encumbrances associated
with aspects such as required maintenance are evaluated during the relatively
long Use-Phase portion of the life cycle. This is where thermal insulation
performs its function of providing occupant comfort while limiting a building’s
(or an industrial process’) impact on the environment through conserving
operational energy. As a result, developing a perspective of the Use-Phase
benefits of installing insulation or using additional insulation in an assembly
or system is critical in achieving a comprehensive understanding of the life
cycle impacts during the early design and decision-making stage.

The prediction of energy performance for any given building
design is complicated by countless variables and influencing factors. Therefore,
it can be challenging for an insulation manufacturer to represent Use-Phase
benefits of its products for marketing purposes, such as through an EPD, in a
manner that is found to be credible by the intended audience. It is important
that this representation be established with the same level of rigor and
transparency as the LCA. A state-of-the-art, computer-based simulation program
that has the ability to model the listed criteria of Section G2.2.1 in Appendix
G of ASHRAE 90.1-2010 10 and tested according to ASHRAE Standard 140
11 (such as EnergyPlus 12) could fit the bill. In addition to
choice of location(s)/climate(s), selection of building design and numerous
system specifications are involved in the simulation exercise. With the purpose
of assessing the impact of various amounts of insulation, resource intensity
can be minimized and a level of credibility in the analysis can be appreciated
by the audience through the application of the Department of Energy’s
Commercial Reference Buildings Project 13. Through this project,
extensive market research has been adapted into 16 typical buildings that have
been fully designed and their operation systems specified for 16 U.S. locations
with fully populated EnergyPlus input files. There are three versions of each
input file, providing widespread representation of newly constructed and
existing commercial buildings in this country.

 

Glossary of LCA Terms

 

Category Indicator. A quantifiable representation of an impact category?e.g.,
infrared radioactive forcing for
climate change.

 

Characterization Factor. A factor derived from a characterization model for
expressing a particular environmental intervention in terms of the common unit
of the category indicator (e.g., photochemical ozone creation potential of methanol).

 

Functional Unit. The quantified function provided by the product system(s)
under study, for use as a reference basis in an LCA?e.g., 1,000 hours of light
(adapted from ISO).

 

Impact Category. A class representing environmental issues of concern to which
environmental interventions are assigned?e.g., climate change, loss of
biodiversity.

 

Life Cycle Impact Assessment (LCIA). The third phase of an LCA, concerned
with understanding and evaluating the magnitude and significance of the
potential environmental impacts of the product system(s) under study.

 

Life Cycle Inventory (LCI). The second phase of an LCA, in which the relevant
inputs and outputs of the product system(s) under study throughout the life
cycle are, as far as possible, compiled and quantified.

 

Product Category Rules (PCR)*. A set of specific rules, requirements,
and guidelines for developing Type III
environmental declarations for one or more product categories.

 

Program Operator*. Body or bodies that conduct(s) a Type III environmental
declaration program.

 

Reference Service Life**. Service life of a building product that is known or
expected under a particular set?i.e., a reference set?of in-use conditions, and
that may form the basis of estimating the service life under other in-use
conditions.

 

System Boundary. The interface between a product system and the environment
system or other product systems.

 

Source: Handbook on Life
Cycle Assessment. 7th ed. New York: Kluwer Academic Publishers, 2004.

 

* Denotes source is
ISO-14025 7

** Denotes source is
ISO-21930 8

 

 

References

1International Organization for Standardization (ISO).
2006. ISO 14040:2006 Environmental management ? Life cycle assessment ?
Principles and framework. Geneva, Switzerland.

2International Organization for Standardization (ISO).
2006. ISO 14044:2006 Environmental management ? Life cycle assessment ?
Requirements and guidelines. Geneva, Switzerland.

3National Renewable Energy Laboratory (NREL). U.S. Life
Cycle Inventory Database. www.nrel.gov/lci/.

4Athena Sustainable Materials Institute. EcoCalculator.
www.athenasmi.org/our-software-data/ecocalculator/.

5Athena Sustainable Materials Institute. Impact
Estimator. http://www.athenasmi.org/our-software-data/impact-estimator/

6International Organization for Standardization (ISO).
2000. ISO 14020:2000 Environmental labels and declarations ? General
principles. Geneva, Switzerland.

7International Organization for Standardization (ISO).
2006. ISO 14025:2006 Environmental labels and declarations ? Type III
environmental declarations ? Principles and procedures. Geneva, Switzerland.

8International Organization for Standardization (ISO).
2007. ISO 21930:2007 Sustainability in building construction ? Environmental
declaration of building products. Geneva, Switzerland.

9Underwriters Laboratories Inc., 2011. Building
Envelope Thermal Insulation Product Category Rule Number UL 110116. www.ul.com/global/documents/offerings/businesses/environment/PCRs/ULE_PCR_EnvelopeThermalInsulation.pdf.

10   American Society of Heating, Refrigerating and
Air-Conditioning Engineers, Inc. 2010. ANSI/ASHRAE/IESNA Standard 90.1-2010
Energy Standard for Buildings except Low-Rise Residential Buildings. Atlanta,
GA.

11   American Society of Heating, Refrigerating and
Air-Conditioning Engineers, Inc. 2004. ANSI/ASHRAE Standard 140-2004 Standard
Method of Test for the Evaluation of Building Energy Analysis Computer
Programs. Atlanta, GA.

12   U.S. Department of Energy, Energy Efficiency and
Renewable Energy. EnergyPlus. http://apps1.eere.energy.gov/buildings/energyplus/

13   U.S. Department of Energy, Energy Efficiency and
Renewable Energy. Commercial Reference Buildings. http://www1.eere.energy.gov/buildings/commercial_initiative/reference_buildings.html.

 

Figure 1
Figure 2
NIA Sites > Insulation Outlook Magazine > Global

Heat Stress and the General Duty Clause

As the heat of summer
continues, a recently published decision of the Occupational Safety and Health
Review Commission (OSHRC) bears discussion. In Secretary of Labor v. Post
Buckley Schuh & Jernigan, Inc. (PBSJ), OSHRC Docket No. 10-2587, Judge
Patrick B. Augustine affirmed a serious citation against the employer for a
violation of the “General Duty Clause” (Section 5(a)(1)) of the Occupational
Safety and Health Act of 1970. 

Much has been said about heat stress as a significant safety
issue, yet many employers give it only passing treatment. Most employers put
cold water on job sites and tell their employees to keep hydrated. Some
employers go so far as to require employees to take periodic rest breaks, and
some even have those breaks taken in a cool environment. In light of the recent
decision, however, this is one time when a little attention is clearly not
enough.

There is no OSHA standard addressing the
hazard of heat stress. OSHA’s enforcement option for such a case is through the
General Duty Clause of the Occupational Safety and Health Act; so when OSHA
does a compliance inspection and concludes that the employer is not providing a
safe place of employment because of the potential for heat-related illnesses,
it must cite the employer under the General Duty Clause.

As you already know, the General Duty Clause requires
employers to provide a place of employment that is free of recognized hazards
that are causing or are likely to cause death or serious physical harm. To
prove a violation, OSHA must provide evidence demonstrating these key
components of the General Duty Clause. In this case, the element of proof would be that the potential heat stress is a hazard that is
recognized either by the employer or its industry and that it is causing or
likely to cause death or serious physical harm.

So, where does this leave the employer?
Judge Augustine’s decision seems to conclude that if you have taken any steps
to address the heat stress issue, you have recognized heat stress as a Section
5(a)(1) hazard. The judge took what the employer in this case did to address
the heat stress hazard and compared it with the heat stress management program
recommended by the National Institute for Occupational Safety and Health’s
(NIOSH) publication Working In Hot Environments.

The NIOSH document recommends a program that includes, but is
not limited to, the following elements:

1.   Acclimatize employees beginning
work in a hot environment and those employees who have been absent from the hot
environment for more than 3 days.

2.   Develop a work/rest regimen. In
the reported case, the judge felt that the employer’s heat safety program was
deficient because it did not have a work/rest regimen; rather, it depended on
employees asking for breaks. (How many of you take this approach?)

3.   Provide cool water and encourage
employees to drink 5 to 7 ounces of fluid every 15 to 20 minutes. In the
reported case, the employer provided ice and water and instructions to be sure to
“drink lots of water.” The judge found this to be deficient because it did not
encourage employees to drink 5 to 7 ounces of water every 15 to 30 minutes.
(Sound familiar?)

4.   Provide for a cool rest area. The
employer should have a rest area close to the worksite that has a temperature
maintained at approximately 76°F. The judge concluded that to permit employees
to go to their vehicles?about a 15-minute walk away?to sit with the air
conditioners on was not adequate. A question was raised as to whether an
employee suffering from heat issues would be able to walk 15 minutes to get to
a cool place.

5.   Provide training to employees
regarding the health effects associated with heat stress, symptoms of
heat-related illnesses, and the methods of prevention. Again, the judge
concluded that the employer’s program was deficient because its training
program did not address the health effects of heat-related illnesses or how to
prevent those illnesses.

Another point NIOSH may be contemplating
is advising that employees be screened for underlying physical conditions that
could be aggravated by exposure to a hot work environment. Because the NIOSH
document did not recommend a screening, however, the judge did not find a
deficiency on this item. I caution readers who approach this criterion with an
eye toward compliance to be aware of the many other laws, such as the Americans
with Disabilities Act, which make it difficult for an employer to legally
obtain this information.

The message from the PBSJ decision is
that while heat stress and its related illnesses might not be governed by a
specific safety standard, it is taken seriously by OSHA and needs to be taken
very seriously by all employers. You need to have a program covering heat
stress or working in a hot environment, and it needs to be more than a reminder
to employees to stay cool, drink plenty of fluids, and ask to take a rest if
they begin to feel bad. You need to model your program around at least the five
guidelines in the NIOSH document. Remember, for many employers, hot weather
will be around for the next 2 to 3 months.

 

NIA Sites > Insulation Outlook Magazine > Global

Exploring Insulation Materials

Polyethylene/Polyolefin

Polyethylene/Polyolefin
insulations are defined by ASTM C1427,  Type I (preformed tubes) and Type II
(sheets). Note: the designations polyolefin and polyethylene refer to the same
type of material and are considered synonymous.

Polyethylene/polyolefin
are flexible, closed cell insulation products. The maximum water permeability
values are 0.05 perm-inch and the maximum thermal conductivity is 0.35
BTU-in/hr sq ft°F at a mean temperature of 75°F.

The
preformed tubular insulation is available in ID size range from 3/8″ to 4 IPS
and in wall thicknesses from 3/8″ to 1″. The tubular product is available with
and without pre-applied adhesive. They are suitable for domestic plumbing
applications where the maximum temperature is below 200°F. The
polyethylene/polyolefin insulations are formulated to meet the flame spread
index of less than 25 and smoke developed index of less than 50.

These
materials are generally applied without additional vapor retarder facings. All
seams including termination points must be sealed with manufacturer recommended
contact adhesive. For outdoor applications, a weatherable jacket must be
applied to protect against UV and ozone damage.

Figure 1
NIA Sites > Insulation Outlook Magazine > Global

Construction Owners: Do You Know Who’s Specifying Your Projects?

The
construction of a new building is a major financial undertaking for owners. For
that reason, owners need to make sure that they get the most for their
construction dollar not just during the bidding/negotiation and construction
phases, but also during the design process. Every decision made during design
has some impact on a project’s bottom line. Therefore, it is prudent for owners
to select design teams with experience and qualifications appropriate to the
specific project.

When selecting a design team, owners consider many factors.
However, frequently overlooked during this selection process is the
construction specifier?the individual responsible for establishing the
qualitative requirements of a construction project. Before exploring the
details of how the construction specifier benefits a project, discussion of
quality and construction documents (particularly, specifications) is necessary
to set the stage.

Quality

Every
owner wants a quality project, but what is quality? In 1979, consultant Philip
B. Crosby defined quality as “conformance to requirements.”¹ Determining
requirements and getting something that satisfies those requirements is the
essence of achieving quality. However, in the design and construction business,
establishing requirements is not as easily accomplished as many would think.
Owners and users have expectations for their construction projects. Many will
transform those expectations into design requirements in the form of a
programming document that will guide the design team in developing the design.
Thus, a design team’s ability to satisfy the requirements in the programming
document is at the center of achieving a quality project.

Construction
Documents and the Role of Specifications

Developing eye-catching renderings and plans are only
the first steps in achieving a quality project. The design team must develop a
coordinated set of construction documents. At the center of these documents are
the drawings and specifications, of which the drawings usually elicit the most
attention from the owner. The specifications, although acknowledged, are often
ignored as technical, legal documents to be used by the architect and
contractor during the course of construction.

In reality, the specifications are
equal to the drawings if construction contracts are based on the American
Institute of Architects (AIA) documents. AIA Document A201-2007, General
Conditions of the Contract for Construction, states that the drawings and specifications,
as well as other contract documents, are “complementary, and what is required
by one shall be as binding as if required by all.” Some owners do not rely on
this equality and have established some level of precedence among the contract
documents?namely, the placement of specifications over drawings in case of conflict.
Thus, the importance of specifications increases while the attention to their
preparation remains the same. Even if owners take no interest in the content?or
the precedence?of the specifications for their projects, they should take
interest in the individuals who are tasked to prepare them.

Although the drawings provide graphic
information that is needed to construct a building, such as indicating
locations and types of doors, there is a lot of information about those doors
that is not indicated, such as fire ratings, fabrication quality, finishes, and
acceptable manufacturers. This is where the specifications become critical.
They provide specific information about a project’s products and materials, and
the requirements for installation. Owners who are concerned about the type and
quality of materials that go into their projects should be equally concerned
about the specifications?including their contents and how they are prepared.

Who Prepares
Specifications?

According
to the Construction Specifications Institute (CSI), the person or persons
responsible for the preparation of specifications will vary depending on the
size of the firm. For small firms, the principal is likely to assume the job of
preparing specifications. Medium-sized firms may have a full-time specifier on
staff, while large firms may have an entire department dedicated to the
production of specifications. In most cases, collaborating design consultants?such
as mechanical, electrical, structural, and civil engineers?will prepare the
specifications applicable to their discipline, with one specifier (usually the
architect’s) acting as coordinator.

For some design professionals, the
preparation of specifications is a secondary concern, with specifications
usually prepared close to or following the completion of the drawings as the
deadline draws near. This regrettable
timing likely will create coordination errors. Additionally, preparing
specifications involves more than just the ability to use a word processor to
edit specification masters. Individuals assigned to specifying duties should
have experience in and an understanding of construction materials and methods,
construction law, building codes, and the specification standards developed by
CSI. Individuals with this level of experience can be considered true
specifiers.

Unlike design professionals who prepare specifications as an
additional task (i.e., “specification preparers”), specifiers make specifying
their profession. The difference between specifiers and specification preparers
is that specifiers possess an expertise that allows them to effectively and
efficiently translate a project’s quality requirements into correct, concise
form for the specifications. The availability of commercial guide
specifications makes specifying easier for the specification preparer, but it
takes skill and knowledge to properly use them.

How does an owner know that an experienced person is specifying
a project? In 1978, CSI introduced the
Certified Construction Specifier (CCS) program. Besides the minimum 5-year
experience requirement, a candidate must pass a 200-question exam that tests
the candidate’s ability to apply specifying principles to certain situations.
Of the several thousand specifiers in the United States, only 1,229 have earned
this credential to date.

Setting a
Standard

The
owner’s best defense against poorly prepared construction documents is
requiring experienced and credentialed professionals on the design team. State
laws require that most projects have a licensed professional prepare the
construction documents. But if being a licensed professional was sufficient to
ensure properly prepared construction documents, why is there such a concern
from owners about the quality of
construction documents?

The licensed professional is similar to a
licensed driver?just having a license does not make you a good driver. Experience
makes a better driver, and specialty training qualifies a driver to operate
certain types of vehicles. The CCS is the design profession’s version of an
experienced driver with specialty training.

When selecting design teams for
projects, owners justifiably seek design teams with experience in the owners’
building types. However, experience with a building type only proves that the
design team can address the
specific needs of the project?it says little about their ability to produce a
quality set of construction documents.

Each owner wants a quality project?one
that is designed to meet the owner’s program and aesthetic goal. Owners also
want their projects within budget, completed on schedule, and constructed with
as few problems as possible?all affected by the quality of construction
documents. Owners can set a new standard by requiring qualified construction
specifiers on the design team.

 

REFERENCE

  • Crosby, Philip B.
    Quality is Free: The Art of Making Quality Certain. New York:
    McGraw-Hill, 1979.

     

    Opinions reflected in this article are
    not necessarily those of NIA. Reprinted with permission from The Voice,
    published by the Construction Users Roundtable.

    • NIA Sites > Insulation Outlook Magazine > Global

    Considerations for Insulation Specifications

    For a facility owner or manager, it is critical to know both
    who is specifying your project and the contents of that specification. This is
    extremely important in the case of mechanical insulation.

    The facility owner has a
    number of different resources available to him when he writes his
    specification, or has it written by a engineer. These resources include a large
    number of ASTM standards, the 2009 ASHRAE Handbook?Fundamentals; ASHRAE Standard
    90.1-2010, Energy Standard for Buildings Except Low-Rise Residential Buildings;
    the online Mechanical Insulation Design Guide; the National Commercial and
    Industrial Insulation Standards, 7th Edition; the 3E Plus® computer
    program; and others. Regardless of who writes the specification, they should
    make use of these references and resources.

    As everyone learns in “Mechanical Insulation 101” (e.g., NIA’s National
    Insulation Training Program or the web-based Mechanical Insulation Education
    & Awareness E-Learning Series), the facility owner first needs to know the
    motivation for insulating. Is it for energy efficiency, process control, freeze
    protection, personnel protection, condensation control, fire protection, noise
    control, or some combination of these? Do all the surfaces specified with
    insulation actually need to be insulated? If the answers to these questions are
    not clear, then the facility owner needs to get answers to be able to proceed
    to the next step and make certain that the specifier is designing the
    insulation system with the same objectives in mind.

    The specifier will need to
    select particular materials. If the facility owner or manager has certain
    preferences, these should be communicated to the specifier up front. If the
    owner doesn’t have preferences, the next step is to confirm that the specifier
    has answered certain questions before selecting materials. Here are few
    questions that could be asked:

    • What
      are the maximum and minimum service temperatures for the surfaces being
      insulated?

    • Will
      those surfaces have cycling or steady temperatures?

    • Will
      the insulation system be located indoors or outdoors?

    • If
      located outdoors, will the pipe being insulated be above or below ground?

    • For
      below ambient systems located indoors, will the space be conditioned or
      unconditioned; and if the latter, is the local climate humid at least part of
      the year?

    • Will
      the insulation be subjected to foot traffic, regular vibration, or other
      physical abuse?

    • Will
      the insulation need to be removed periodically for mechanical maintenance or
      inspections and the insulation then reinstalled?

    • How
      long does the facility owner expect the insulation system to last?

    • For
      outdoor facilities, have steps been taken to guard against water leakage into
      the insulation system and subsequent possible corrosion under insulation (CUI)?

    Once insulation materials
    have been selected to the owner’s satisfaction, the owner should understand how
    insulation thickness has been determined. If it is a commercial building and
    energy efficiency is one of the reasons for insulating, then the owner should
    make certain that the mechanical insulation meets the requirements such as
    those in ASHRAE Standard 90.1-2010. (The 2013 version is in development.) If
    the pipes to be insulated are part of an industrial facility, there are several
    questions the owner should ask and the specifier should be able to answer.
    Since the owner will be paying for facility energy use in future years, perhaps
    most important pertains to energy efficiency and cost effectiveness: Are the
    insulation thicknesses the optimum economic thicknesses for energy efficiency?
    A second question would be: Are the insulation thicknesses sufficient to
    maintain process temperatures as required by the industrial processes? If the surfaces
    being insulated operate at high temperatures, are the insulation thicknesses
    sufficient to protect personnel from being burned if they come in contact with
    those surfaces? If the piping, equipment, and ducts operate at below ambient
    temperatures in unconditioned spaces, the owner should make certain that the
    insulation thicknesses are sufficient to prevent surface condensation up to 90%
    relative humidity, as recommended by ASHRAE.

    Finally, the facility
    owner should know whether certain special design conditions have been
    addressed. Here are a few examples of special conditions that could apply:

    • In the design plans, has sufficient clearance
      been left for insulation installation and maintenance?

    • If the insulation system is going to be exposed to
      certain corrosive chemicals that might damage the materials, have chemically
      resistant materials been specified?

    • If the insulated systems are located outdoors in a
      wet climate, have special design features been incorporated to guard against
      water intrusion and subsequent likelihood of CUI?

    • If frequent inspections and/or maintenance will be
      required on certain insulated components, have removable/reusable insulation
      materials been specified?

    • If horizontal insulated pipes are located close to
      the ground or other places where maintenance workers may walk on those pipes,
      have high compressive strength insulation materials been specified for those
      pipes?

    • Have insulated, below ambient pipe and
      equipment located in humid, unconditioned spaces been insulated with materials
      that will not support mold growth; and has special attention been paid to
      maintaining a sealed, low water vapor permeance for the insulation system?

    • If there is heat tracing, have the design plans and
      insulation sizes been correctly selected to allow for installation over the
      heat tracing?

    The
    list of special conditions could go on. Over time, if they have not been
    adequately addressed in the insulation specification, the owner will probably
    suffer the consequences. Those consequences could be greater than necessary
    energy use, large-scale CUI, physically or chemically damaged insulation, wet
    insulation, mold growth on insulation, high cost of removing insulation and
    subsequent reinsulation with new materials, high insulation maintenance costs,
    etc. It pays for facility owners to know the contents of their insulation
    specification and to make certain it addresses their needs, both from the
    beginning, when the facility is new, and through subsequent years of operation.
    As a final caution, the facility owner must always guard against “value
    engineering” the insulation systems, since that process all too often results
    in short-term dollar savings but long-term increased expenses on energy,
    insulation maintenance, CUI mitigation, and other operational costs.

     

    NIA Sites > Insulation Outlook Magazine > Global

    Marketing Your Firm Using LinkedIn

    Most subcontractors are doing next to nothing with
    LinkedIn    . This leaves a
    big opportunity for those who see the potential and are already acting on it.
    The fact is, for subcontractors in particular, LinkedIn offers a tremendous
    opportunity to stand out.

    Demonstrating your company’s qualifications and
    professionalism, highlighting your team, establishing yourself as the authority
    and expert in your space, and gaining a direct line of communication with the
    contractors you want to do business with can all be achieved within LinkedIn
    and can have a big impact on sales. There are a number of ways to position your
    firm as the authority for your trade and generate leads within LinkedIn.

    Starting and
    Contributing to Groups

    If
    you can stay in front of your prospects on a regular basis, you’ll be the one
    they think of first when they are ready to make their buying decisions. The
    method with the greatest impact for staying in front of prospective customers
    is to start and facilitate a LinkedIn group that targets and attracts your
    ideal clients. As members of your group, these prospects will receive group
    communications on a regular basis, all of which have your company name on it,
    including group announcements, the daily digest of activity delivered to their
    inbox, and “manager’s choice” features, to name a few. After seeing your
    company name every day over a number of months and associating your firm with a
    valuable LinkedIn community, group members will look to your company as a true
    expert and authority. If you are serious about generating leads within
    LinkedIn, invest in growing your own group.

    LinkedIn also provides the opportunity
    to contribute to other groups and reach prospects who participate in those
    groups. You’ll find geographically focused groups, trade-based groups, general
    contracting groups, and more. Find and join the groups that matter most to your
    business; that is, groups that contain the most relevant prospects as members.
    Then, engage with group members and comment on discussions in which you can add
    value. Sharing content such as news stories and how-to articles is also a
    positive move, because it helps establish your firm as a group member that’s in
    the group for the “right” reasons.

    Content Development
    and Distribution

    The
    content you develop and post should be valuable to your prospects. “Value” for
    your prospects can be anything that may help them improve their businesses.
    This content may take the form of a tangible insight into your trade or
    business practices. Articles about how great your company is, or news releases
    about new projects, are generally not going to get you the kind of attention
    that will catapult you to expert status in the eyes of your prospects. Rather,
    what helps achieve expert status are articles, reports, webinars, case studies,
    and videos that give tangible knowledge about your business that can help group
    members improve their businesses. Remember, clients are interested in
    developing a strong supply chain.

    LinkedIn offers a variety of ways to consistently keep your
    message in front of your top prospects and clients. Within groups, you can post
    your content as discussions. These discussions are also delivered to group
    members’ inboxes via the daily digest e-mail. If it is truly resourceful and
    not overly promotional, your content will stand out and be seen by influencers
    in your market.

    Encourage employees to create personal LinkedIn accounts and
    include your company name as their current employer. LinkedIn users who visit
    your company profile page will be able to view each of your employees’
    profiles, along with their skills and expertise, further highlighting your
    company’s qualifications. The more employees you have on LinkedIn, the more
    exposure your business will have to prospective customers.

    Employees should post their own content, as well as the
    content your company shares, using the “Share an Update” field on their
    LinkedIn pages. This field allows them to “Attach a Link” and cross-post the
    update to their Twitter accounts by selecting the box next to the Twitter icon.
    Employees should also post content in your company group and in other industry
    groups. Sharing your company’s content and creating their own content positions
    your people as experts with the clients they serve and the potential clients
    they are connected to.

    Direct-Messaging
    Campaigns

    Distributing
    content via groups and status updates will yield many positive results but will
    not guarantee that 100% of your prospects will see it. Messaging campaigns are
    another powerful way to keep your message in front of prospects and clients,
    providing them with tangible resources to help their business.

    Identify a subset of your prospects that you consider to be
    high-value targets for business development. Directly message these contacts
    with a quick note and link to your new content. Send these kinds of messages
    only every month or two. You don’t want to come off as too pushy. Your
    prospects will be glad that you passed these messages to them, provided that
    your content is truly resourceful and helpful to their businesses. Executing
    this strategy consistently will position your firm as a true expert and open
    the door to new business opportunities with prospects.

    Building New
    Connections

    Once
    a quarter, re-evaluate your LinkedIn connections to be sure that your content
    is reaching the right prospects. Consider whether you are active in the right
    groups and connected to the right people.

    You’ll increase the marketing value of LinkedIn if you
    consistently connect with new prospects. By providing your new connections with
    the same valuable resources that have already established your firm as the
    expert with your original connections, you’ll find that LinkedIn can truly be a
    powerful, personal marketing system. Using LinkedIn can be an effective way to
    make your firm’s expertise and qualifications known to potential clients in
    your area.

    If you want to learn
    how to use social media, including LinkedIn, to expand your online professional
    network, the American Subcontractors Association (ASA) on-demand video
    Expanding Your Professional Network ? and Your Profits ? in the Digital Age can
    help.

    This 90-minute on-demand video explains why social media
    tools like LinkedIn, Facebook, and Twitter are a valuable investment and how
    your company can expand its online professional network to include prospective
    customers and industry leaders.

    Expanding
    Your Professional Network ? and Your Profits ? in the Digital Age is $80 for
    NIA members and $95 for nonmembers. Your purchase includes a hyperlink to view
    the on-demand video whenever, and as many times as, you’d like. Order the video through the NIA bookstore at www.insulation.org/products
    or by contacting NIA at 703-464-6422 or niainfo@insulation.org.