Knowledge is power, in this case, power saved
The age-old saying that you can’t manage what you don’t measure holds especially true when it comes to a business’s energy-use—and the cost of missing out on the low-risk, high reward opportunities associated with managing and monitoring energy-use are greater and more far-reaching than one might expect.
Overall energy consumption reductions of up to 50% can be achieved by monitoring and managing energy-use with the aim of improving efficiency. These savings can clearly benefit any size enterprise, across business sectors, making energy efficiency extremely desirable. However, the energy crisis in South Africa, growing energy demand, grid reliability concerns and the increasing cost of electricity have meant that efficiency has become a necessity for South African businesses to remain profitable. Energy efficiency allows companies to improve their risk management and to achieve cost savings.
The impacts are significant but also far-reaching, benefiting many aspects of a business and the greater environment
According to the McGraw Hill Construction 2011 SmartMarket Report, buildings consume 40% of energy in the U.S and release 38% of the national Carbon Dioxide (CO2) emissions. By taking action to increase efficiency, businesses who occupy inefficient designed and operated buildings, stand to greatly improve their profitability, productivity, market differentiation and the natural environment. This is due to consumers’ and employees’ proven desire to be affiliated with environmentally responsible organizations. It has also been shown that efficient buildings have higher occupancy rates and increased asset value compared to a buildings operating at default efficiency. Efficiency also reduces CO2 emissions and supports environmental awareness which further encourages environmentally responsible decision-making.
Energy efficiency management utilises both intellectual and physical resources
South Africa’s historically low electricity prices have resulted in wasteful business practice and now, with increasing electricity prices, there is a pressing need for behavioural change. A 2012 Greentimes article, written by Terra Firma Solutions MD Ed Gluckman, discusses how the “business case for implementing energy efficiency is becoming stronger year by year as Eskom continues to raise electricity prices and energy efficient technology continues to become more affordable”. The increased affordability of energy efficient technology now means favourable ROI with paybacks in less than two years for certain technologies.
Each business sector has its own challenges and unique opportunities from energy efficiency—in each sector, opportunities outweigh challenges
Below are examples from Terra Firma Solutions (TFS) case studies which reveal savings that can be achieved from creating and implementing valuable, result-driven energy efficiency strategies and utilising various energy efficiency technologies:
TFS has helped a large number of offices achieve significant savings. Using TFS built energy monitoring and management software, companies are able to consistently manage and monitor energy-use, in real-time and from a number of easy-to-use devices, thus ensuring long-term benefits, reduced risks and optimal energy-use based on TFS calculated algorithms. Offices have managed to reduce their consumption by up to 40%, resulting in savings of tens of thousands of Rands annually.
Over R1m annual savings have been achieved with a payback period of 3.3 years
In a retail sector example, TFS helped a popular Cape Town shopping centre reduce consumption by 1.67million kWh, or 25%, by implementing a number of energy management measures. These included, but are not limited to, retrofitting, improving control and behavioural change. TFS also achieved a kVA reduction of 162 kVA, or 4%. Combined, these results meant a total annual saving of R1.250 million with a 27% 1st year ROI and a 3.3 year payback period.
A large packaging company, with an energy bill in excess of hundreds of millions of Rands per annum, approached TFS to help them with their energy efficiency and management. Incredible savings were achieved:
- The packaging company had high voltage levels which damages equipment and operates inefficiently. Implementing voltage optimisation through PowerSines optimisation product helps to company eradicate overvoltage supply and voltage fluctuation.. The optimisation resulted in R212 793 annual savings with a 4 year payback period.
- Lighting upgrades and the facility showed annual kWh savings of 69 543kWhs and R62 812 annual savings with payback period of fewer than 2 years.
Similarly large savings were achieved in the agricultural sector, for a JSE listed company, by the help of TFS. This company had an annual energy bill in excess of R120 million. TFS achieved savings of R850 000 through its energy efficiency projects with payback periods of between 0 and 2.7 years.
TFS also analysed the company’s tariffs and found a cost reduction of R563 833 annually by changing the client to the optimal tariff for their business. TFS implemented power factor correction which saved the company an additional R80 000 per annum with a payback of 2 years.
Energy efficiency is the first step towards reaching the ultimate goal of net zero energy
Energy efficiency for businesses is a low-risk investment, which yield substantial rewards. Taking steps to achieve efficiency is essential for businesses across sectors because of the far-reaching benefits and long-term savings. Companies in the US have fast adopted energy efficiency practices, with 91% of all surveyed companies for the 2011 SmartMarket report, having conducted energy efficiency upgrades in the previous two years. The ultimate goal that will yield the greatest benefits, however, is reaching as close to net zero energy as possible by combining energy efficiency strategies and renewable energy. Reducing energy costs to as close to net zero as possible will provide the platform for long term sustainable growth and profits for businesses across multiple industries.