Some business owners breathed a sigh of relief when the 1st July 2013 NSW energy increases were announced. After last year’s staggering 16% average rise, this year’s increase was a mere 1.7% percent on average for electricity. Gas customers were not so lucky however, with the average rise being 8.5%. So what has this actually meant for business over the winter months?
While some businesses can cut down on gas consumption by being less frivolous with heating, there are some sectors, like aged care, that simply cannot afford to turn off the heat. One care provider, with 263 beds across three sites, was subjected to an increase of $3,826 on its gas consumption between July and September. The care provider called in an Energy Services Company (ESCO) to evaluate the potential savings that could be made with a complete energy efficiency plan. The ESCO suggested optimising the gas boiler system, which offered savings of $12,875 per year on gas consumption. Other solutions included replacements and refurbishments of lighting and controls and optimisation of HVAC (Heating, Ventilation and Air Conditioning). The total package would save the care provider $83,530 per year and a measurement and verification process would be implemented by the ESCO to ensure the savings were achieved.
The aged care sector is heavily reliant on its heating and cooling systems, so will be particularly impacted by energy price increases. A study by UTS in 2011 predicted that, by 2020, gas prices could rise by another 25% to 50% from 2013 figures. This is in line with the IPART determination for regulated tariffs.
There are huge financial and environmental savings to be made by commercial buildings, if they improve their energy performance. Australia’s industrial sector, for instance, is currently leaving $2bn per annum on the table in energy efficiency savings. Improving the energy performance of buildings is much more cost effective than people realise. An energy efficiency company will evaluate the site and each energy component will be assessed for its effectiveness and compared to the efficiency of the best solutions available. From this analysis, savings will be estimated. The ESCO will provide a free report on the efficiency of the building(s), detailing the estimated losses in energy and potential CO2 and cost savings. A good ESCO will also guarantee the savings and provide cash flow positive funding for the project, so businesses and organisations can start making savings immediately.
Commercial buildings in Sydney's CBD have been saving $25 million per year on their power bills, for the last two years, with City of Sydney's Better Buildings Partnership. Over half of the City’s offices have now signed up for the scheme. City of Yarra in Melbourne is also doing great work in this space with its YES scheme (Yarra Environment Strategy). With cities accounting for 70% of global carbon emissions, schemes from city councils are an integral part of the journey towards a low carbon economy.