We still see great opportunities in both the public and commercial sectors, says Vladimír Kučera, the new sales director at Amper Savings.   22.4. 2021

You have been operating on the energy savings project market for a long time now and have a great deal of experience. Why did you decide to work with Amper Savings?

It is true that I have been working in this field since 1995, meaning something over a quarter of a century. When I look at it like from this perspective, it is a little shocking. I was always used to being one of the younger team members – yet at AS I am an ‘old man’, so hopefully my experience will be beneficial at least.

I decided for Amper Group for many reasons. If I ignore happy chance – the fact that we met at just the right moment, found out we have something in common, and had something to talk about – I think that this is primarily a logical progression of my professional career. Here I see many synergies, opportunities for mutual benefit, and also the chance to take advantage of the mentioned experience and contacts – in short, it simply makes sense. 

I have long seen AS as one of the key players in the EPC market and one that, unlike others, has retained its own know-how and other skills needed to properly design and implement savings measures, meaning it is not merely an empty box with great marketing. On the contrary, it is a flexible modern company unburdened by the corporate or ownership complexities that ultimately cause a lack of competitiveness and high internal costs. Last but not least – and I cannot resist emphasising – my decision also rested on the great feeling I had from the personal qualities of the key members of the management. I simply felt good about our meetings and I could see myself enjoying the work here.
Which product from the Amper Savings portfolio do you intend to focus on? Where do you see the greatest potential today?

I am convinced that in the future the company’s main product will still be its EPC projects (implementation of savings or optimisation measures/reconstruction with guaranteed results, usually with a financing option from the savings achieved). 

However, I would definitely not underestimate PDB, or performance design build (construction of new buildings/technologies using EPC elements from the perspective of the design method and the provided guarantees for sustainable operating parameters/costs). I do not yet see a massive growth in demand (ESCO companies and advisors are certainly ready – the issue is rather the will and courage of investors), yet at the same time I also believe that this trend has already reached the Czech Republic, and the clear benefits for both investors and operators make me think it will become a building standard in the future.

A serious question mark for me is the combination of EPC with new subsidies (existing OPE and forthcoming OP EIC). On the one hand, this will enable significantly higher investment budgets for the future, which is doubtlessly a good thing. Yet on the other, unfortunately, it is also burdened by the flaws and risks related to subsidy projects in general (greater time and administration burdens at least). I would be glad if we did not lose sight of the fundamentals – the advantages and specifics of the ‘pure’ EPC projects – which I consider unique precisely because they enable the implementation of important energy-related measures that are self-financing without the help of subsidy crutches and yet at the same time, strict selection means that only measures which make sense (return on investment) and which are genuinely needed are implemented. In other words, I hope that ESCO companies will be able to cope with this new trend, the consultants have sufficient capacity to cope with the onslaught of projects and keep the level of measures in check, and EU subsidies will enable the financing of deficit measures such as insulation and other types of revitalisation of structural parts of buildings that could not be implemented separately due to the desired return on investment.

Finally, specifically in the AS presentation, I very much like how the Energy Management product is understood in relation to the customer. I consider it very useful to offer it not only as an essential service within the framework of running EPC projects, but also as an independent product. The fact that we thus get nearer to the customer, acquire the necessary detail and real knowledge of the operated/managed technologies, and can concurrently demonstrate during this activity that “we understand it” and can also finance it from the resulting savings, may be the way to – after mutual trust is established – launch wider cooperation in the form of e.g. implementation contracts or EPC.

Energy saving technologies and measurement and regulation systems are dynamically evolving. What technological innovations are you intending to offer to the customers?

Yes, we are living in a dynamic and turbulent time, and technology is evolving rapidly. It is basically a struggle or race, in which manufacturers try to present constant changes (lower emissions, smaller, more sophisticated designs etc., but also very often reduced durability and lifespans). I do not think that everything new is necessarily better. We have to be able to identify the line between innovation and consumerism... Even though I am (with all modesty) a relatively technically proficient person, I often cannot help feeling that this technological pace is unnecessarily rapid and sometimes actually damaging. In any case, the lay person not operating in the field can find it difficult to stay abreast of what is happening. This is actually one reason why AS often becomes a partner for institutions and/or industrial enterprises that hire us as an ‘external power engineer’ and consultant. We are able to offer unbiased consultation to these partners, helping them to choose their energy focus, and often find a mutually acceptable way to integrate our Energy Management. One fundamental result of this cooperation is that the customer is free to focus on their core business while, thanks to our services, effectively operating and developing their energy management. One objective experience is the finding that this is, inter alia, the most economically advantageous model for them.

Yet back to your question. For my part, I am convinced that it is precisely the fact that EPC is not merely a 24-month statutory warranty, but a long-term, very close relationship between us and the customer (usually 5 to 15 years) that forces us to carefully think about the right design and selection of the most suitable components and technologies. After all, we are responsible for them – they influence our economy for the duration of the contract – and so we have strong motivation to avoid problems. I like proverbs, and here I think the most appropriate is “buy cheap, buy twice”. In our applications I therefore want to use traditional, quality products from leading European manufacturers (of course ideally Czech and Slovak ones) with the longest possible service life and warranties – basically ‘quality smithy work’ (if one can actually speak of modern technology in this way). Throughout my career, I have had a constant and close relationship to ‘strategic purchasing’, and I was actually on the other side of the barricades for many years – meaning at manufacturing companies or distributors. The result is that I intend – through the right choice of suppliers/partners with the shortest possible purchasing chain (meaning ideally a direct relationship with the manufacturer, allowing us to inspire each other in terms of design and development) – to design and build our projects from very high quality components with support and partnership from leaders in the technological fields, while retaining economic advantages and competitiveness. I have already applied this strategy several times in my previous engagements, and it always paid off for us (and I believe for the customers as well) and I am sure that such partnerships can be transferred to Amper Group.

Last year was a record one from the perspective of the energy performance contracting (EPC) market. Investment in new projects using the EPC method reached CZK 523 million, the highest in history. Will this record-breaking trend continue despite the ongoing pandemic?

What can I say? I would really like it to be the case, and of course I intend to do what I can in that regard. Yet at the same time as a manager I am more of an ‘preventive pessimist’ and so I sometimes find it difficult to imagine better tomorrows. As the majority of EPC projects are still recruited primarily in the municipal or public spheres, I am logically concerned (as probably the majority of sales directors in this field) that the spending on the battle against the virus will make itself felt in these budgets. I have already mentioned EPC with subsidies above, and here I would like to make an even stronger appeal to the relevant ministries and other government officials not to be lazy and to push these packages closer to reality… 

At the same time, I want to believe that the risk of a lack of funds for investment may not affect EPC as much as other sectors. After all, if there must be investment, then where better than into savings/optimisation with guaranteed results/return and the ability to finance the investment from the resulting savings? I do not like when some colleagues incorrectly and ‘cheaply’ present EPC as a form of financing in which the customer does not need any money. It is, however, true that an EPC project implemented by a respected traditional ESCO company (ideally Amper Group of course) is definitely more attractive from the perspective of the financing banks than other investment measures.

EPC projects are currently primarily being implemented in the public sphere. Under what conditions could interest in this method be promoted in the commercial sphere?

Hmm, a tricky question… Primarily, there definitely needs to be a change in the attitude and thinking on the part of investors… and the same also applies in regard to the financial institutions. I have often discussed possible future projects with industry representatives, and the reaction was always like: “A return of 8 to 15 years? I’m not interested! If I invest in manufacturing technology, I get my money back in 2 to 3 years…”. Although this attitude is relatively short-sighted and these two different investments are certainly not mutually exclusive, it is however true. Nevertheless, if there are not sufficient funds for both and the banks are enthusiastic about EPC in industry, there definitely needs to be a certain level of courage and awareness on the part of the industrialists. When addressing the willingness to provide financing, we have often come up against resistance from banks, which basically like lending to municipalities and state organisations, but are less keen to ‘take risks’ and are willing to discuss 5-year contracts at most (which is mostly not feasible in terms of the real return for more complex technologies). Hence, I think the requisite is the already X-times announced involvement of the state-owned ČMRZB promotional bank, which would provide guarantees to banks and thereby increase the attractiveness/safety and frequency of these projects. I think that this could work in combination with the forthcoming support under the OP EIC. I see further motivation in the increasing pressure from the EU in terms of meeting quotas for the reduction of CO2 emissions (on which Amper Group is relatively intensely focusing – see our CO2IN project).

Do you intend to use synergy effects with other Amper Group companies?

Yes. Well, I hope so. But now, in all seriousness, I consider myself a strong team player and the word SYNERGY is one of my favourites – not only rhetorically, but primarily practically. Amper Group is, I would say, principally built around mutual support among the individual ‘divisions’, and it would be a shame not to take advantage of this. Right from the initial phases of our internal discussions we have thus been cooperating and creating a strategy based on mutual cooperation. From the perspective of the sales director/representative of the company, I am thus happy I am able to boast that we have under one roof specialists in savings, industry, CHP and renewables, M and R, with support from our own professional Meteo services and strong assembly and servicing capabilities… We are simply good – take a look at our website for details.

Is it possible to estimate something like the ‘average potential savings’ for various potential customers, e.g. hospitals, schools or warehousing facilities? Here, we are of course thinking about buildings where energy saving projects have not yet been implemented. 

I definitely do not think so, and I fundamentally disagree with any such claim! It is definitely possible to quantify an average of what we have achieved just by using statistics – here I would dare to give a minimum value of between 25% and 35% (there have even been applications achieving up to 60%). Yet I would consider promising something like that without more detailed knowledge of the situation to be sloppiness. I would once again use a simple comparison – something like: If you are lucky enough to have the right figure, you can basically buy any clothes and they will probably fit you and perhaps even suit you. Unfortunately, in case of the majority of EPC projects the issue is dressing non-ideal figures (and it really does not matter if they are “overweight” or a different deviation from the average). As an ESCO company I would therefore compare us more to a “bespoke tailor”. 

In my experience, even two identical buildings, technologies, and equipment types can have diametrically different solution conditions and requirements. It is also unfortunately the case that a relatively significant proportion of previously installed equipment was not: a) properly designed, b) properly assembled, c) properly adjusted, or d) properly operated. This is mostly the case in particular for projects involving subsidies (in other words, “why shouldn’t we install it if it is free?”).

To put it more simply, the implementation of EPC and savings or optimisation in general brings the need for THOROUGH knowledge and assessment of INDIVIDUAL needs and operating conditions. The preparation of a solution then involves brainstorming by EXPERTS and a multi-round search for the ideal UNIQUE solution. Without this individual approach it basically cannot work, not to mention that from my point of view we might even call it gambling (and once again irrespective of whether this is by the customer or the ESCO company). This is another reason why only a limited number of companies operate or are able to establish themselves in EPC – you need genuinely high levels of expertise and experience. Any mistakes are particularly expensive and the ESCO company is fully liable for such mistakes through the guarantees it provides. This is not a simple discipline – I am glad to be able to operate in this environment and that I can represent the companies in a group which definitely belongs in this “Champions’ League” and plans to be seen right at the top in the future.