Changes Planned for DOE's Volume Purchase Program

February 17, 2011
Government

Widely known as the "R-5 Windows" program, the Department of Energy is changing the name of the initiative to the High Performance Windows Volume Purchase Program. That change reflects a broadened scope that accommodates not only residential windows and patio doors, but commercial and architectural products as well.

Designed to increase availability and demand for more energy efficient products, the DOE program is administered by the Pacific Northwest Research Laboratory, which recently issued its request for proposals inviting window and door companies to participate in Phase II of the the initiative.  With bids to participate due March 18, PNNL representatives recently participated in a Q & A with Window & Door examining the program's progress in Phase I its first year, as well as the changes planned for Phase II.  

Answers to the following questions were provided jointly by Graham Parker, PNNL senior staff engineer and program manager for the DOE High Performance Windows Volume Purchase Program, and Terry Mapes, a PNNL engineer and principal investigator for the DOE program.

WD: For companies considering participation, what do you see as the biggest changes in Phase II of the Volume Purchase Program compared to Phase I?

PNNL: We have made revisions to the specifications that will allow commercial products to enter the program. We have set minimum U-factor requirements for windows classified as Commercial Windows (CW) or Architectural Windows (AW). This will provide products for those applications (new and retrofit construction) where a higher performance grade window is required.

Prices on the volume purchase Web site will be shown for each vendor for each product they bid into the program. Previously, for a given product, consumers would see a list of vendors and a range of their prices without knowing which vendor offered which price.

Additional information about each product bid into the program is required as part of the bid. This includes solar heat gain coefficient (SHGC) and the performance grade which will be available to buyers on the Web site.

We are requesting (as an option) bids for other ranges than the window minimum quantities we established in Phase I so that vendors who wish to sell products in less than the minimum quantity, or wish to offer price breaks for larger quantities, can submit bids for those quantities.

Lastly, we have changed the name of the program to the U.S. Department of Energy High Performance Windows Volume Purchase Program. This change was necessary since we have expanded beyond R-5 residential primary windows with specifications for commercial products with U-factors ranging from 0.24 to 0.32.

WD: Have changes been made to product criteria? Are performance requirements different? Are any of the testing or certification requirements different?

PNNL: Residential primary windows specifications are relatively unchanged. The only significant addition is a minimum condensation resistance (CR) of 50 for residential primary windows. In addition, low-E storm windows will now need to be certified according to the ANSI/AAMA 1002.10-93. In Phase I, the windows only needed to be tested to this standard.

WD: What about rules for participation?

PNNL: The initial entry to the program is the same as in Phase I. Bidders must meet the performance specifications, meet certifications requirements, supply a warranty, a URL and sign an agreement letter. In Phase II, we have a priority deadline of March 18 for bids. Any vendor submitting a bid after that deadline will be placed in a queue and will be added to the program after those vendors who submitted bids on or before March 18 are processed. Continued participation in Phase II, after entry, will be contingent on two key requirements:

1) Vendors in the program will be required to maintain a Web site that seamlessly directs buyers to the products they have in our program in a clear and unambiguous process. Additionally, any means of contact which they offer to interested buyers must lead to personnel who are knowledgeable about the program and responsive to inquiries.

2) Monthly sales reports must be submitted to PNNL even if the vendor had no sales. Additionally, we will request (but not require) sales of all high performance windows products that meet our specifications even if those sales did not originate via the windows volume purchase program. DOE is very interested in the market reaction to increased availability of high performance window products.

WD: You mentioned changes to Web site; will information on products and pricing be presented differently? What do participants need to understand about that?

PNNL: Unlike Phase I, prices will be shown for each vendor for each product bid into the program. Any secondary party, such as dealers and distributors, are required to sell products at or below the base price bid into the program by the product manufacturer. Also unlike Phase I, dealers and distributors will not be allowed to bid directly into the program. Only manufacturers of the products will be allowed to enter. Six months after the initial bid deadline (March 18) vendors will be allowed to raise their base prices for any or all of their products. This is the only time they will be allowed to do so, but they may lower their prices at any time during the program.

WD: Do companies that participated in Phase I have to resubmit their bids for Phase II?

PNNL: All vendors in Phase I interested in participating in Phase II of the program will need to submit bids for Phase II and have been informed of this requirement. The agreements with the vendors executed in Phase I also expire at the launch of Phase II.

WD:  If companies didn’t participate in Phase I, what are some of the main reasons they may now want to consider being part of the Phase II program?

PNNL: A number of companies may not have finished testing and certifying products before the deadline in Phase I and will now have the chance to enter those products in Phase II. Because we have expanded the products to commercial grade products, companies that sell these products are now eligible to participate.

WD:  Are there any particular changes you foresee helping accelerate sales through the program?

PNNL: Making our Web site and the vendors' Web sites more buyer-friendly is perhaps our highest priority for Phase II. We are convinced that "keeping the traffic moving" will attract much more interest from buyers and will accelerate sales in Phase II.

The overwhelming number of comments we received from potential buyers in Phase I was regarding the difficulty navigating our Web site, more specifically, finding any kind of a price for the products they were seeking. Buyers also were having difficulty finding the products in the program when accessing many of the vendors' Web sites. We temporarily addressed this problem by creating the optional online bid request form that has been used extensively by buyers, but we felt we needed to do more in Phase II. As mentioned above, we feel compelled to show vendor base bid prices to the buyers and we will be working with the vendors to make their Web sites more transparent and easy to find the products in the program.

WD:  Is DOE/PNNL satisfied with Phase I of the program? What was successful about it? What was less successful?

PNNL: One key measure of the success of the program is the increased availability of high performance window products. We feel we were noticeably successful at accomplishing this goal given the number of vendors that responded to Phase I, the attention given to the program in industry venues, and the increasing amount of media coverage we have experienced in the first year. Launching such a program for relatively expensive niche products during the worst economic conditions in 70 years was clearly a challenge, and as a result, the overall window sales as reported on the Web site reflect this. However, DOE believes we have substantially raised nationwide awareness of high performance windows. Evidence of this awareness was found at the International Builders' Show in Orlando in January 2011, where several of the vendors in our program displayed R-5 windows and/or advertized their participation in the windows volume purchase program.

WD: Was DOE pleased with industry participation? What about participation of purchasers?

PNNL: Industry interest and participation was enormously successful. We initially anticipated 5 to 10 vendors would submit bids for Phase I. To our surprise, we received bids from 62 vendors with 40 certified to participate in the program. Ratings organizations such as NFRC and AAMA have asked us to provide input into some of the decisions they are making for the future of the industry. And we have been invited to industry events such GlassBuild and regional fenestration meetings to give presentations.

As mentioned above, the construction industry was crippled this past year, and therefore we did not see as many sales as desired. However, we believe there will be significant increases in construction activity across all sectors in the next few years. And with a wider range of high performance windows products from which to choose, industry has a terrific opportunity to accelerate penetration of high performance windows and low-E storm into the marketplace.

WD: In their marketing efforts, numerous window manufacturers were highlighting the fact that there products qualified for the DOE's R-5 program over the past year. Since R-5 is no longer part of the program name, does that impact the use of such language?

PNNL: Manufacturers who participate in the volume purchase program are free to use any descriptor to announce, indicate or otherwise advertise their participation in the program. There are no restrictions other than DOE prohibits the use of their logo in any type of advertising–as does Pacific Northwest National Laboratory. Some manufacturers in Phase I have developed their own branding and they are welcome to continue to use it.