The best business advice, opinion, news and expertise in Greater Manchester and further afield.

Friday, 13 March 2015

Member Blog: Energy Solutions for Business

By Ciara Taberner - Managing Director, Taberner Consultancy Company Ltd


We all look for ways to save money within our businesses but somehow energy saving does not seem to feature high in cost reduction programmes in UK business.

Studies have recently shown that a further £1.6 BILLION collective business savings could be made on energy bills through greater energy efficiency. Going Green is no longer seen as an overhead and businesses are increasingly realising that it’s now a way to make a profit.

“Making your business green is now a way to make profit"
    
There are lots of simple and cost effective ways your business can save money by reducing your energy consumption. Below are some of the examples; this is not an exhaustive list by any means but I hope some of this information will help you realise some of the potential savings that can be made by making a few changes.

“An industry building could be losing approximately 60% if its heat through the building fabric”

Payback Period

All energy efficiency improvements have an average payback period which is given in years. The payback period is a calculation worked out by taking the total cost of any improvements and dividing it by the estimated annual bill savings for that improvement.

The cost of installing any improvements will vary on any quotes you may receive, as an installer will tailor the quote to meet the needs for your particular building and every building is slightly different. As with any other business expenses, it is always worth shopping around for a few quotes to ensure best value.

You will receive information on your payback period within your energy assessment.

“Payback periods can be less than a year for some energy efficiency improvements”

Solar PV

There are lots of models on the market to help you install a Solar PV system for your building/s. The first and most important thing to understand is: Does my building face in the right direction? Simply get outside your building with a compass! Most smart phones have a compass on there or you could download a compass app onto your phone.

If one side of your building is South, South East, South West it is more than likely to be suitable for Solar. That is your starting point. There are other factors to take into account like the pitch of your roof, shading, your roof type and size, but that this is something that can be looked at during a survey.

There are two options available for Solar PV:

Fully funded model where the system is paid for by an installing company/investor
Purchase the system outright

These will depend on your own business circumstance but my advice from here would be to get a survey completed and ask the provider to detail out the different options that are available. Remember, not every company will be able to provide a paid and funded model so shop around to find the right solution for you.  

Fully installed and maintained system

This would consist of the panels being installed and maintained for 20/25 years free of charge and your company gets the savings on your electricity bill. The provider/investor would get the Feed in Tariff and they would make the profit out of the Feed in Tariff giving them a return on their investment over the agreed period. Savings on your electricity bill will depend on your roof orientation and size.

Purchase the system outright 

The alternative is you pay for the system up front and your business gets the reduction on the electricity bill and the return on investment from the Feed in Tariff

What is the Feed in Tariff? 

Feed-in tariffs (FiTs) make the business case for installing renewable energy for electricity generation more attractive. They were introduced to encourage the use of small scale electricity generation from renewables to help meet the Government's renewable energy generation targets.

The Feed in Tariff (FIT) provides three financial benefits for your business:

1. If you generate your own renewable electricity you are paid for the electricity you produce and the excess exported to the grid, you also don't have to buy as much electricity from a supplier.

2. A generation tariff pays for every kWh of electricity generated. The level of the tariff depends on the type and size of technology used, and when it was installed. You are "locked into" the tariff level that is current when the equipment is installed for the life of the installation or the life of the tariff (10 - 25 years).

3. An export tariff pays for any electricity exported to the grid. You can either accept a flat rate or try to negotiate a better rate with your electricity supplier.

To recap…. when you have the system installed for free you get the savings on your bill and the investor gets the Feed in Tariff.

When you pay for the system yourself – you get the savings plus the Feed in Tariff. As you have paid for the system up front it will take a few years for you to move into profit but once that original is paid off you will start to see your return on investment. How quickly you will start to see that return will depend on a number of factors such as the size and orientation of your roof but you will make a return on your investment!

I am not suggesting you take that option. It is obvious that for some businesses the free model will work better and you will still be receiving the big savings on your energy bill therefore whatever model you choose, if your roof is suitable, I would still encourage you to install as many energy saving technologies as you can.

Insulation

I would encourage you to have a survey completed on your property to establish if your property is suitable for any kind of insulation measures such as solid wall insulation, cavity wall insulation, loft insulation, flat roof insulation.

Most of these measures are relatively low cost and provide huge bill savings.

LED Lighting

Again another simple, low cost solution that can save approximately two thirds of the cost of your lighting bills! Payback periods are normally as low as one year.

Other Energy Saving Tips and Advice 

Make sure your boiler is regularly serviced; every 12 months is a must to ensure it's working effectively and efficiently.
Draught Proofing - do the one pence test. If a one pence coin can slide between a window and its frame, draught proofing will be cost effective.
Draught proofing doors
If you do need to replace your boiler make sure you use a GASSAFE registered installer. Shop around for quotes and ensure your installer sizes the boiler correctly for your building size, usage and radiator numbers.
Keep windows and skylights clean to maximise daylight
Add loft insulation to any uninsulated roof space
Check internal wall insulation and consider upgrading
Take advantage of any refurbishment work to make energy saving improvements
Get online and check out British Board of Agrément Website. You can check your insulation installer on here to ensure they are accredited to install the different materials  
It is also good to check the National Insulation Association website. There is a public area where you can check out your installer.  It really important to select a good company as incorrect installation can lead to problems in the building later on: http://www.nia-uk.org/

What next?

Get an EPC or ESOS assessment completed on your property to establish which technologies are best for your building.  It’s important to choose a suitably qualified individual who can look at your building and advise the best possible ways for your business to save money and reduce energy consumption.  Make sure this is someone independent.

You should ask them to produce a report on your business, along with which technologies would be best suited to your building, payback periods on each measure and your energy usage.

Ask them to include an analysis on your gas and electricity tariff to see if you can make any savings on that too. You will then need quotations/funded models for each of the measures and you can make an informed decision the next course of actions.  You might decide to get one company or various companies to do this. Make sure you get a few quotes from different suppliers.

If you are a large undertaking you must carry out an ESOS assessment every four years. ESOS is the Energy Savings Opportunities scheme. ESOS is a mandatory energy assessment scheme for organisations in the UK that meet the qualification criteria. These assessments are audits of the energy used by their buildings, industrial processes and transport to identify cost-effective energy saving measures.

A large undertaking is an organisation that carries out a trade or business which either:

employs at least 250 people
employs less than 250 people but has an annual turnover in excess of 50 million euro (£38,937,777), and an annual balance sheet total in excess of 43 million euro (£33,486,489)

Helpful Links:

www.decc.gov.uk
http://www.energysavingtrust.org.uk/
www.carbontrust.com
http://www.greatbusinessdebate.co.uk/environmental-impact/
https://www.gov.uk/energy-savings-opportunity-scheme-esos
http://www.bbacerts.co.uk/
http://www.nia-uk.org/
http://www.gassaferegister.co.uk/

Contact Ciara at Taberner Consultancy Consultancy Ltd via ciara@tabernerconsultancy.co.uk


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