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Minimizing Risk With An HVAC Contingency Plan

With Hurricane Isaac breathing down their necks on Aug. 28, 2012, administrators at a regional hospital in south central Louisiana had plenty to occupy their minds. One thing they did not have to worry about was whether the storm would leave them without electric power or heating, ventilating and air conditioning (HVAC) services. If Isaac knocked the hospital off the local power grid, a rental generator was already on site to keep the lights burning, the HVAC running and lifesaving medical equipment working. The damage and havoc brought about by Hurricane Sandy is only a reminder of the importance of proactive power and HVAC contingency plans.

Because the hospital had a proactive power and HVAC contingency plan in place, the facilities management team was able to contact its temporary power and HVAC equipment partner and have the generator installed and ready to power the facility in about 24 hours.

Every company needs to include a power and HVAC contingency plan as part of its comprehensive crisis-response plan. After all, it does not take a natural disaster to cause millions of dollars in damage, disrupt operations and erode stakeholder confidence. An effective power and HVAC contingency plan minimizes financial risk, protects the health and safety of building occupants and provides peace of mind for the company and its stakeholders.

In fact, contingency planning is considered so important that some insurance carriers require companies to have a formal plan as a condition for providing business continuity coverage.

Here are some step companies can use to evaluate, analyze, create and implement a contingency plan that meets their specific needs:

  • Analyze the financial impact of a disruption in power or HVAC service. Experienced contingency service providers can help companies estimate the true costs of unplanned downtime, which go far beyond the cost of repairing equipment in a crisis mode. They may also include lost finished goods or inventory, reduced worker productivity, diminished levels of service, lost customers or patients and missed revenue or other business opportunities.
  • Assess the level of risk by identifying potential causes of system failure — including natural disasters, power outages, equipment failures or sabotage — and rank them based on their probability, potential to disrupt normal operations and financial cost.
  • Perform a critical equipment audit to identify mission-essential power and HVAC systems and assess their current operating condition. Address performance problems and document potential failure points. Many companies engage an energy services company (ESCO) or other third-party expert to conduct the audit.
  • Identify priorities and critical processes. By taking business priorities into account, the contingency plan can focus on areas within the facility that would have the greatest impact on mission-essential operations and the bottom line were an unplanned service interruption to occur.
  • Find the best place to position temporary equipment on the site and know in advance how equipment will be connected to the building. Identify potential challenges, prepare connection points in advance and arrange for any required permits. This includes determining whether current electrical service is sufficient to operate temporary equipment, such as a chilled water system or supplementary HVAC unit. There is no substitute for having the right connections for electrical, water and air ducts when it comes to speedy response time during a crisis situation.
  • Using all this data, develop a summary report. The report should outline requirements, actions that need to be taken and all associated costs and how they will be allocated.
  • Develop and implement the contingency plan. Assign roles and responsibilities and provide training. Conduct drills to verify the contingency process and identify areas for improvement. Make required building modifications in advance. Update the plan annually or whenever there is a significant change in the facility, such as a building modification or expansion.

Identifying reliable, experienced partners — including third-party contingency planning consultants and temporary equipment providers — is essential to developing and implementing an effective power and HVAC contingency plan. Leading HVAC industry contingency planning consultants have proven tools to ensure that the company develops a complete, effective and useful contingency plan; one that does not just sit on the shelf. The best power and HVAC temporary equipment partners have large inventories of the equipment the company needs, well-positioned geographically, along with a proven track record, world-class response time and a reputation for high levels of customer service.

Time and money spent on contingency planning is an investment that often pays for itself several times over the first time it is used. An effective, well-understood and broadly shared contingency plan enables a company to minimize service interruptions, reduce capital loss, maintain or restore normal operations sooner, and create peace of mind for the business, its customers, employees and other stakeholders.

Source:; Carl Shedivy; October 5, 2012.