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    RFP Issued to Analyze Residential Heating Systems

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    PROPANE EDUCATION & RESEARCH COUNCIL

    Request for Proposals for a Comparative Analysis of Residential Heating Systems

    June 6, 2008

    General Information
    The Propane Education & Research Council (PERC) is a non-profit 501(c) 6 trade organization authorized by the Propane Education and Research Act of 1996 (PERA), Public Law 104-284. PERC was created “to enhance consumer and employee safety and training, to provide for research and development of clean and efficient propane utilization equipment, and to inform and educate the public about safety and other issues associated with the use of propane.” This Request for Proposals (RFP) is not subject to any federal or state procurement law or regulation.

    A 21-member Board of Directors appointed by the National Propane Gas Association and the Gas Processors Association governs PERC. Members include propane retail marketers, producers, transporters, and agricultural cooperatives, as well as representatives of allied service and supply industries.

     

    Project Overview / Objectives
    The Propane Education & Research Council is seeking a comparative analysis of residential propane heating and related cooling systems versus heating oil systems and geo thermal and air to air heat pump dual-fuel or hybrid systems. The comparisons should document consumer receptivity of best value, comfort, and financial return on investment (ROI) of each heating system. Where applicable, standard efficiency systems should be compared with upgraded ultra efficient systems for ROI purposes. The comparative analysis should be directed primarily at heating systems but should include air conditioning where it could make a difference in the overall annual energy cost of the combined heating/cooling system. The analysis should include comparison across appropriate climate zones. The results of the project will be considered an intermediate reference document. Information will be extracted for education outreach efforts to consumers, builders, and propane industry members using a research-based value proposition articulating the benefits of propane fueled heating systems.

    Air to air heat pump and geo thermal systems, also referred to as dual-fuel or hybrid HVAC systems, have existed in the U.S. market for decades. However, with the recent increase in national average residential propane prices relative to electricity, greater consumer interest in these systems has developed. This fact-based approach to the energy value proposition can enable propane marketers and builders to influence consumers to make informed energy choices when selecting a heating system for their new home or when retrofitting the heating system in their current home. A primary objective of the project is to determine to what extent the ROI for upgrading to an ultra efficient propane heating system from a standard efficiency propane heating system is a good value when compared to geo thermal and air to air heat pump and heating oil system upgrade options.

     

    Background
    The propane value proposition for residential home heating is subject to criticism by consumers and builders. There are circumstances where comparisons of other home heating energy sources have used worst case scenarios of propane cost and efficiency and an ideal maximized operating scenario for the competitive system. Competitors may neglect to compare heating system factors such as the complete annual site and source energy usage of the entire heating system, greenhouse gas generation and other environmental impact, complete installed system cost differences, warrantee length and average useful life, maintenance complexity and cost considerations, comparable return on investment, and the ability to produce a high level of comfort under heavy heating demand load in a cost-effective and dependable manner when considering different climatic regions.

    This fact-based approach to the value proposition will enable propane marketers and builders to influence consumers to make informed energy choices when selecting a heating system for their new home or when retrofitting the heating system in the home they currently live in. The updated propane value proposition will be factored into the creative outreach strategy, ensuring that propane does not look like the “old school” heating option.

     

    Proposals to Provide Services Sought / Scope of Work
    Have research performed on residential heating and related cooling systems to assemble facts to make a best value comparison between propane heating systems, heating oil systems, and geo thermal and air to air heat pump systems.

    Provide data to perform a strategic assessment of home heating system effectiveness by climatic region coupled with energy cost information to help propane marketers decide whether their focus should be on retaining primary home heating business or gaining other propane usage in the home including a back up or dual fuel heating role.

    Suggest ways to use research results to assemble a method of mathematical assessment and comparison of heating system operating cost and return on investment in a local market.

    Use research results summary to compose research fact sheet on the propane value proposition that articulates the benefits of heating with propane, including enhanced lifestyle from other uses in the home.

    Provide research data for future marketing strategy of getting propane back in the dialog in markets where heat pumps and geo thermal systems have made significant inroads.

     

    Strategies
    Research residential heating systems to compare the following:

    Heating/cooling system installed cost including pre-installation best practices or requirements such as engineering design for complicated systems. Compare installed cost under new construction versus retrofit.

    Return on investment (ROI) based on initial system cost and operating cost comparisons including maintenance and average useful system life. Include present home upgrade and new home comparison examples.

    Compare total energy cost (propane, fuel oil, and/or electricity) by region of the country to operate on an annual basis, to include energy cost to run all required auxiliary equipment such as pumps, blowers, electric resistance back up heat where applicable, etc.

    Assess level of comfort under heavy heating demand load.

    Report climate or region differences in heating demand load and how it affects operating cost, particularly on geo thermal and air to air heat pump systems where high heating load requires back up heat which is commonly electric resistance heat.

    Report greenhouse gas emissions of total energy used by each system based on PERC GHG Study.

    Include general warrantee comparison including maintenance complexity and cost considerations.

    Incorporate existing research data, market studies, and manufacturer’s information where available. Some parts of the study may require a parametric analysis backed up with existing statistical data and energy analysis.

    Use the National Association of Home Builder’s (NAHB) Green Building Standard as a basis of comparison on points available for each system and an evaluation to see if there is a competitive advantage or challenge that exists.

     

    Type of heating systems to be compared:

     

    • Standard efficient propane forced air
    • Ultra efficient (mod/con) propane forced air
    • Hydronic propane forced air (hydronic with air handler coil)
    • Standard efficient fuel oil forced air
    • Hi efficiency fuel oil forced air
    • Standard efficient propane hydronic system with baseboard radiation
    • Ultra efficient (mod/con) propane hydronic system with in floor heat
    • Standard efficiency fuel oil hydronic system with baseboard radiation
    • High efficiency fuel oil hydronic system with in floor heat
    • Geo thermal closed loop system (electric resistance versus propane back up)
    • Geo thermal open loop system (electric resistance versus propane back up)
    • Standard efficiency heat pump system (electric resistance versus propane back up)
    • High efficiency heat pump system (electric resistance versus propane back up)

    Qualifications
    The contractor must demonstrate and describe its ability to anticipate, coordinate, and carry out all aspects of the project. Primary qualifications include expertise and significant experience in information gathering, interpretation, and writing. Project completion dates will be an important factor in selecting a contractor. PERC anticipates the award date for the project to be October 10, 2008. Eligible applicants for this solicitation are profit organizations, not-for-profit institutions and organizations, educational institutions, and individuals.

     

    Other Requirements
    Responding proposals must include the following specifications. The specifications are derived from PERC’s funding request form. The funding request form may be used and is available upon request.

    1. Statement of the Project

    • Background information about the project
    • Describe any prior projects upon which the proposed project is based or which had the similar goals and objectives as the proposed project
    • Goals, objectives, and anticipated results of the project and planned deliverables
    • Identification of essential personnel expected to participate in the project
    • Status of essential personnel as employee of the applicant, consultant, or contractor

    2. Timeline for the Project

    • Commencement date
    • Completion date
    • Key project stages and activities
    • Dates upon which deliverable(s) will be presented to Council
    • Final Report due date (due not more than 60 days from completion date)

    3. Budget and Statement of Costs

    • Specifically include direct costs, salaries, overhead and subcontractor costs, fees, and expenses
    • Statement of how much the applicant is contributing toward the cost of the project in cash, in-kind, and services
    • Detailed statement of other funding sources contacted or to be contacted, the expected amount of funding from each, the status of each application of funds, and any conditions placed upon the use of funds. Proposals with matching grants will be looked upon more favorably than others
    • Budget to be broken down by task

    4. Cost-Benefit Analysis

    • An examination of the value(s) of all favorable effects (benefits) to safety, consumer awareness, and/or propane consumption relative to the amount of funding being requested
    • An assessment of the cost effectiveness of the proposed work (this is the ratio of cost per unit of desired results)
    • If applicable, a discussion of possible alternatives that could achieve similar purposes

    5. Evaluation Statement

    • The applicant’s Evaluation Statement should describe roles, responsibilities, performance measures, evaluation methodologies, and data sources.

     Notices

    1. PERC, in its sole discretion, also reserves the right to not award to any contract on the proposals received.

    2. PERC may request additional information from any submitter.

    3. Neither this RFP nor the submission of any proposal creates any contract or obligation on the part of PERC.

    4. Should PERC identify a proposal(s) suitable for award, the submitter(s) will be required to sign a written agreement for the services sought. This contract will be an indefinite quantity contract which will permit PERC to order the successful submitter(s)’ review of as few as one program. The quantity ordered beyond the minimum set forth in any resulting contract shall be at the discretion of PERC.

    5. PERC will not accept any information in any proposal that is designated confidential or proprietary or contains confidential or proprietary information. PERC cannot and will not guarantee that should such information be submitted that it would be maintained as confidential. Should a submitter desire to submit proprietary or confidential information, it should contact PERC in advance to discuss whether and how such information may be effectively submitted.

     

    Additional Information
    Proposals will be subject to an objective merit review procedure of PERC’s Consumer Education Advisory Committee.

    Please send all questions regarding this request for proposals and your intentions to bid in writing via email to Tracy Burleson at tracy.burleson@propanecouncil.org by June 13, 2008. For copies of the following PERC documents, please visit our website at http://www.propanecouncil.org/:

    a) Propane Education and Research Act

    b) Fact Sheets

    c) Press Releases

     

    For information on PERC’s outreach to consumers and builder professionals, visit our websites at http://www.usepropane.com/ and http://www.buildwithpropane.com/

     
    Timeline
    Request for proposals June 6, 2008
    Intent to respond June 13, 2008
    Submit questions June 20, 2008
    Response to questions June 27, 2008
    Proposals due July 11, 2008
    Submitting Proposals

    Proposals are required to be contained in a single file and must be sent in electronic PDF or Microsoft Word format to tracy.burleson@propanecouncil.org They are due at PERC’s office no later than 5 p.m. Eastern on July 11, 2008. A hard copy or CD may also be mailed to:
     
    Tracy Burleson

    Propane Education & Research Council
    1140 Connecticut Avenue, NW, Suite 1075
    Washington, DC 20036
    202-452-8975 (phone)