Energy efficiency
Increasing energy costs are one of many challenges facing households and businesses. Many of us can feel helpless trying to navigate the complexities of energy contracts, power purchase agreements, smart meters and solar and battery storage.
Fluctuating power charges
The grid is supplied with energy from a variety of sources. These days, renewables are an increasing component throughout the day but as this is comprised primarily of solar energy, after 5pm, prices can surge. There are many solutions you can implement to reduce the impact of these fluctuations.
Power purchase agreements
A business can connect with a renewable energy generator to establish a power purchase agreement (PPA). The agreement is long term (e.g. 10 years) and sets a fixed price over that period, providing certainty for both the purchaser and the generator. There are certain variables to consider when looking to enter a PPA, including whether the amount of electricity your business generates is sufficient. Many generators are open to signing agreements with a consortium of businesses who combine their usage to access better rates.
There are two main types of PPAs: Wholesale and retail. Wholesale agreements are directly with the generator while in retail agreements, businesses access the generator through their existing energy retailer.
Benefits:
Reduced costs: By signing onto a longer term contract, you may be able to negotiate lower rates than what you currently pay. And if you combine with other small businesses to increase capacity, you can access cheaper rates, usually reserved for big businesses.
Price certainty: Locking in a price over a 5-15 year period allows you to budget and plan with electricity price fluctuations out of the picture.
Credibility: Purchasing from renewable sources helps your business reduce its impact on climate change and demonstrates to your customers that you care.
Contact your retailer to find out the options they have available. Need help? Contact us.
Energy monitoring and smart meters
An easy way to manage energy use and reduce your costs is to monitor the efficiency of your current set-up. Simple things like making sure your lightbulbs are LED and power points are turned off when not in use, will have an impact. You can also install a smart meter to get real-time data on energy usage. This will show when you are using a lot of energy and help manage usage during peak times. It will also allow you to identify anomalies, e.g. when the HVAC system is left on overnight. The NSW government has grants and incentives for businesses to monitor their energy, check out their programs here. Need help? Contact us.
Solar and batteries
Using solar energy can be a useful tool to reduce your reliance on the grid. The decision to install solar for your business will depend on how much energy you use and how much space you have. The payback of solar installations vary and if your business does not have high electricity usage, it may not be the right fit. If you find that solar energy is right for you, you may want to think about investing in a battery. A battery will significantly help smooth your energy usage where you can draw from the grid during the day when energy is cheaper and then use energy stored in the battery in peak periods. Again, battery installation isn’t right for every business and will depend on the extent of energy usage in peak periods as the cost of installation may be more than the benefit it will bring. Need help? Contact us.
There are many combinations a business can put in place to create the most energy efficient business and each business will have its own unique plan. It’s important to consider the different options and weigh up the costs and benefits before making any major capital purchases and always look out for opportunities for grants and rebates through your state government.
