ELECTRICAL · ELECTRICAL AND TECHNOLOGY · FIXED BY STEP 06

Your gear release clock starts at the power company

Gear can't release for fabrication until the utility publishes available fault current, and the utility isn't on your subcontract at all.

WHY IT'S AN ELECTRICAL PROBLEM

No other trade's fabrication release depends on a letter from a regulated monopoly that has no contract with anyone on the site. The study sets protective device settings and arc flash labeling, which makes the utility letter a hard gate in front of a 30 to 60 week build rather than a paperwork step. Everyone on the job treats energization as the electrician's date, and the electrician controls none of the three parties who set it.

WHAT IT COSTS

The size of it

Six to ten weeks of pre release delay pushes energization by the same six to ten weeks, and you absorb an extra winter of general conditions, supervision, and a remobilization that was never priced. On a $1.2M electrical scope that's $40k to $90k of field overhead that never reads as a variance, because there's no cost code for waiting.

OVERHEAD AT $1M–$5M
16%
CFOS target 15% for electrical.
GROSS MARGIN AT $1M–$5M
25%
CFOS target 27.5% for electrical.
NET PROFIT AT $1M–$5M
9%
CFOS target 12.5% for electrical.

Ask for the available fault current letter the week the service size is set, not the week the submittal is due. The chain runs one direction: utility fault current letter, then the PE stamped short circuit, coordination, and arc flash study, then the gear submittal, then approval, then release to fabrication, then a 30 to 60 week build. A study house won't stamp against an assumed fault current, because the breaker settings and the incident energy labels on the doors depend on the real number. Every week burned at the front of that chain moves to the back of the longest lead item on the job, so a six week wait for one letter is a six week push on energization.

WHAT TO DO

Three moves, in order

STEP 01
File the utility service application and the written request for available fault current the same week the service size is set, and put that request date on the schedule as its own milestone.
STEP 02
Write into the subcontract that release to fabrication is contingent on receipt of the utility fault current letter, with day for day relief running from the date the request went in.
STEP 03
Open a cost code for gear release delay and log the supervision and standby hours behind it, so month three of waiting has a number attached to it.
QUESTIONS

What electrical owners ask

Short circuit study waiting on the utility is holding up my gear release?

Gear can't release for fabrication until the utility publishes available fault current, and the utility isn't on your subcontract at all.

What does it cost?

Six to ten weeks of pre release delay pushes energization by the same six to ten weeks, and you absorb an extra winter of general conditions, supervision, and a remobilization that was never priced. On a $1.2M electrical scope that's $40k to $90k of field overhead that never reads as a variance, because there's no cost code for waiting.

What do I do first?

File the utility service application and the written request for available fault current the same week the service size is set, and put that request date on the schedule as its own milestone.

What are electrical contractors supposed to be making?

Electrical runs 25% gross margin, 16% overhead and 9% net profit before taxes at $1M–$5M. The all-trade average is 7%, so this trade is 2 points above it. The CFOS target is 12.5%.

Which part of the system fixes it?

The step is number 06, project management. Billing dates, change orders, and notices, written as standards that work without anyone chasing them. It comes from chapter 6 of CONTROL: The Construction Financial Operating System.

OR HAVE IT HANDLED

Everything on this page is something you can install yourself, andCONTROL is the order to do it in. If you would rather buy the finished result, SPM The Construction CFO does this work for electrical contractors as a service. It is a separate firm, Sulphur Prairie Management, LLC, run by the same author.

What a fractional CFO does for electrical contractors

AUTHOR
Josh Luebker
JOSH LUEBKER
MASTER ELECTRICIAN · 150+ PROJECTS · $2.1B+ MANAGED

Wrote CONTROL, the 8 step system behind these figures. More about the author.

8 Steps 60 Days

CONTROL is the full system, written for commercial subcontractors from under $1M to $100M. It's out now. 8 steps, 6 working templates, and the order they install in. $9.99 ebook, $24.99 paperback.