With the price of energy sky-rocketing, it’s not just domestic users who are feeling the pinch, businesses are too. Rising costs are either being absorbed by the business or having to be passed on to their clients which, either way, will have an impact on profitability or on sales.
So, what can businesses do to try and mitigate the rising cost of energy?
Implementing an energy management programme can help drive savings within the business.
Carry out an energy audit
A great place to start on the energy management programme is by conducting an energy audit. This involves assessing how much energy your business uses and finding ways to reduce consumption to make savings. Energy audits can be conducted by energy efficiency experts, or internally by employees. An energy audit can help identify areas where your business is wasting energy or where energy usage can be changed to drive savings.
The audit should determine when, where and how energy is being used. It will provide information the business can use to improve efficiency, reducing both energy costs and greenhouse gas emissions.
Carrying out energy audits should be an ongoing activity, carried out once or twice a year. An ongoing programme of audits will help determine theeffectiveness of the energy-efficient projects that have already been implemented and measure savings and highlight new areas where savings may be possible.
Energy audits have different degrees of complexity. Your energy audit should be defined based on the size of the company, the availability of internal resource to perform the activity or a decision made whether this activity will be outsourced to an energy saving expert for your industry. Every energy audit, however, typically involves the following:
- Data collection and review
- Surveys and system measurements
- Review of operating practices
- Data analysis and reporting
- Recommendations for implementation
What are the key steps for carrying out an energy audit?
1. Conduct a building condition survey – this includes the general maintenance of the building, the housekeeping and operations that have a bearing on energy use – hours of operation; specific machinery with high energy consumption; periods of high energy use. This can flag specific areas that need further assessment and investigation throughout the audit.
2. Create the energy audit mandate – define the expectations and deliverables of the audit and get buy in from all relevant parties who are involved in the process.
3. Establish the audit scope – define the breadth of the audit – is it the business as a whole or a specific department, for example.
4. Analyse the current situation – collect data on current energy consumption, tariffs and historical billings. It is ideal if this data is available for at least a 12-month period, though even better if for longer. This will allow the audit to analyse seasonal usage for more accurate reporting.
5. Compare energy performance – create indices of energy use and compare them between months or quarters, between buildings or departments or between the business and industry available data.
6. Profile usage patterns – create the energy demand profile
7. Inventory assets – create a list of all energy-consuming loads within the audit scope. Identify their energy consumption and demand characteristics
8. Identify opportunities for energy management – identify operation and technical measures that could be implemented to bring about a reduction in energy waste
9. Identify and assess the benefits – calculate the potential cost savings. Identify if there are other benefits such as reducing your business's carbon footprint, beneficial impacts on resources
10. Reporting – report the audit findings to stakeholders with plan of action for implementation
11. Measure against these findings and potential cost savings when the next audit is carried out
For more information on energy audits for business, click here.
What are some energy saving tips for business?
Running heating all the time versus office hours
“Is it cheaper to run my heating 24/7 or on-demand?”
This is one of the most frequently asked questions for energy saving experts. And the answer is, ‘it depends.’ That doesn’t sound so helpful, but it does make sense.
What determines if this is the most cost-effective way of running the heating depends on another factor. Insulation.
If the building is well insulated, there is less heat loss and less need for the boiler to kick in to keep the building at a constant temperature. If you have good insulation – both at home and in the workplace – you only need to heat a room once a day. This obviously depends on whether the doors are kept shut and how many people are in and out of the room on a daily basis. But if a room is well insulated and all the doors were shut all of the time, the temperature would remain constant all day long, reducing the need for re-heating.
Energy savings can be made if the building is well insulated by leaving the thermostat at a constant temperature 24 hours a day.
In contrast, if the building is not well insulated, drafty or has older windows and doors or sub-standard double-glazing, it will be more costly to leave the heating on over the 24-hour period. If this is the case, the thermostat should be programmed to come on at a set time before employees start work. This will mean that the boiler has to work harder to get the temperature up to the required level, but it means there’s less energy loss during unoccupied times.
Consider upgrading the building’s insulation
‘Traditional’ insulation comes in the form of foam panels that are inserted in the cavity between inner and outer walls or outer walls and plasterboard. This type of insulation is easy to fit at the time of build, but it’s costly in terms of price and space and can be messy and time-consuming to retrofit.
There are a number of other solutions that are available on the marketwhich are especially effective for retrofitting to existing buildings.
Thin-film thermal insulation is an innovative and highly effective product that seals buildings and creates a ‘bubble’ within a room – reflecting heat from walls and ceilings back into the room. It also prevents heat loss and can increase room temperature between 3-5°C, dependent on the condition of the building. It’s a paint-on solution, so is quick and easy to install.
Liquid foam is another option that can be retrofitted to existing buildings. It fills the cavities in the interiors of buildings, though the application does depend on the type. Liquid foam can fill even the smallest cavities, which creates an effective air barrier to increase temperature and reduce heat loss.
Consider installing energy efficient devices
Investing in energy-efficient equipment is another way businesses can save money on energy bills. This could involve things like energy-efficient lighting, appliances and office equipment. Energy-efficient equipment often costs more upfront, but can save businesses money in the long run by reducing energy consumption.
Imagine a business with 50 employees, who are all consumers of hot drinks whilst at work. If the company supplies a kettle for staff use, this potentially could be switched on dozens, if not hundreds, of times a day.
All electrical appliances are measured in Watts (W) and an electric kettle averages around 3000 Watts. Electricity is charged in Kilowatts per hour (Kw/h). 3000 Watts is the same as 3 kilowatts – which means an electric kettle uses 3 kilowatts of electricity per hour.
Obviously, the kettle is not run constantly for an hour, but the calculation for a full kettle to be boiled is 0.225 kw/h, whilst a half-full kettle is 0.113 kw/h. At the average price for business customers of 36 pence per Kilowatt of electricity*, each time a staff member boils a kettle, the cost could be in the region of 4.06 pence – 8.1 pence. Multiply that by dozens of boils per day, and the costs mount up.
A hot water dispenser could be a less expensive option than a kettle in a workplace. Models vary but a standard, plumbed, countertop machine can dispense around 27 litres per hour. Not only do they save money against constant re-boiling (and the inefficiency of over-filling the kettle), but they saveti me by eliminating the need for staff members to stand round while the kettle boils, which results in lost productivity.
Educate employees on energy saving practices
Another way that employers can save money on energy bills is by educating employees on energy saving practices. This could involve things like turning off lights and electronics when they’re not in use, setting thermostats to an energy-saving temperature, and using natural light where possible.
Employers could provide energy-saving tips to employees in a company newsletter or intranet site, or even hold energy-saving competitions with prizes for the most successful participants. This could increase buy-in as well as increase awareness and deliver some really innovative energy-saving ideas.
Encourage employees to work from home
Encouraging employees to work from home is another way to save money on energy bills in the workplace. The perception of working from home has dramatically changed since the advent of Covid-19. Many employers are offering hybrid working which helps reduce energy consumption by cutting down on employee travel and energy usage in the office.
Overall, there are many ways employers can save money on energy bills in the workplace by investing in energy-efficient equipment, conducting energy audits, and educating employees on energy saving practices. By taking these steps, companies can help reduce their energy consumption, improve their carbon footprint, as well as reducing their overall operating costs.
*At the time of writing, a 12 month day rate only profile (fully fixed rate), on a consumption rate of 20,000 KWhs per year is unit priceof 36 pence per Kw/h. Information supplied by EnergyfloweLtd
PayCaptain Payroll Solutions Limited, www.paycaptain.com an HR/FinTech company that delivers a fully automated cloud payroll service. The solution contains many unique and innovative features for employees, helping them to take control of their pay and increase their financial well-being. PayCaptain is a payroll solution that helps employers pay their workforce regardless of income and personal circumstances. The solution also incorporates functionality that is specifically designed to positively impact financial resilience for people struggling with money, or vulnerable and low-income employees.
PayCaptain is the world’s first payroll company to be B-Corporation certified. To read more about B-Corporations, visit www.bcorporation.net