Energy Expenses Your Business Doesn’t Need
Every dollar matters in the budget of a small business. Yet, one frequently overlooked area of a budget is energy expenses. While many businesses regard their energy consumption as just a bill that needs to be paid, the savvy business owner understands that trimming down energy use and prioritizing efficiency results in huge savings. On average, small businesses can cut their utility costs by 10-30% without sacrificing quality, style, or comfort. Not only do these savings bolster your budget, but they also contribute to a healthier environment.
Understanding Energy Expenses
But what exactly are energy expenses? In a small business, these expenses encompass the costs related to performing daily operations including electricity, heating, cooling, and appliances or machinery. Energy expenses fall under two categories: direct and indirect. Direct expenses are closely tied to energy consumption, such as your energy bill. On the other hand, indirect expenses include the maintenance and repair of equipment and systems that affect energy efficiency. High energy costs often result from both types of expenses due to inefficiencies in equipment, outdated technologies, and wasteful human habits. Understanding how your energy consumption impacts your utility bill is the first step in reducing these costs.
Assessing Your Current Energy Usage
To reduce energy expenses, it’s necessary to understand your business’s current energy use. Begin by learning how to read your utility bill and familiarizing yourself with electric and gas meters. This forms the foundation of knowledge for energy consumption. Review previous energy bills to identify usage patterns and seasonal fluctuations. Furthermore, monitor energy consumption during peak and off-peak demand periods. These insights will empower you to make informed adjustments to your business operations.
A data-driven method to evaluate current energy usage is conducting an energy audit. They vary in complexity, from basic assessments to thorough analyses, based on your needs and budget. Companies can perform audits on their own or enlist the expertise of professional energy auditors. These industry experts delve into historical consumption data, inspect building infrastructure, and evaluate it for opportunities to improve efficiency. After their analysis, they provide a comprehensive report, complete with tailored recommendations to improve your energy performance, ranging from equipment, system, or structural upgrades, as well as energy-saving practices for you and your employees.
Identifying Energy Efficiency Opportunities
Identifying specific efficiency opportunities is the next step in reducing energy costs for your business. Upgrading to energy-efficient equipment is a key strategy that not only reduces operational expenses but also contributes to a greener environment. Opportunities for efficiency improvements also include embracing smart technologies like automated lighting and HVAC systems, smart building controls, occupancy sensors, and programmable thermostats. These tools empower businesses to optimize their energy consumption while improving comfort and productivity.
Outdated lighting systems
One of the easiest upgrades to optimize lighting systems is switching to LED lighting. LEDs use up to 90% less energy than conventional lighting systems. LEDs also have an expected lifespan of 25,000 hours which is significantly longer than an incandescent bulb’s lifespan of 1,000 hours. Beyond updating your system overall, businesses can practice daylighting, prioritizing natural daylight over overhead lighting, to further reduce electricity consumption.
Overworked heating, ventilation, and air conditioning (HVAC)
HVAC systems are major energy consumers for businesses. A proactive approach to HVAC maintenance is essential for reducing utility expenses. Create a maintenance schedule with a trusted technician to optimize your system’s performance and prepare for seasonal changes. Implement automated technology that allows you to adjust temperature and ventilation based on occupancy and operating hours. Zoning strategies and timers will prioritize comfort while reducing energy waste in unoccupied spaces.
Vampire energy consumption
Monitoring plug loads and standby power is an easy way to further your energy efficiency goals. Electronics actively consume energy, even if they’re powered off. Reduce the costs of vampire energy consumption by unplugging electronics when not in use. Curtail additional energy waste by implementing power management solutions like smart power strips or timers. By implementing these simple practices, you can significantly reduce wasted energy and lower operational costs.
Unmonitored energy usage
Energy Management Systems (EMS) are comprehensive software solutions designed to monitor, control, and optimize energy consumption in commercial environments. EMS solutions improve energy efficiency, reduce costs, and ensure reliable power supply. Key features of an EMS include real-time energy monitoring, automated lighting and HVAC controls, customized reporting, and support for renewable energy integration. EMS solutions are highly individualized to align with your business’s specific energy demands and sustainability goals.
Renewable Energy Options
Exploring renewable energy is an eco-friendly way to reduce utility costs and energy grid reliance. Solar power is a popular choice as it suits most structures with direct sun exposure and offers the benefits of lower utility bills and reduced emissions. Evaluate the available sunlight, roof condition, and your local regulations to determine if solar is right for your business.
Additional renewable sources to consider are wind power and geothermal energy. Both options require specific climate or geologic conditions, so they might not be universally available. While the cost of renewable installations can be daunting, there are an abundance of funding opportunities available to help support renewable integration and other efficiency projects.
Funding and Incentive Programs
Often, upfront installation costs are the reason efficiency upgrades are delayed. Fortunately, the government offers a variety of grants and subsidies to businesses pursuing efficiency improvements. Explore funding and incentive programs from the Department of Energy or your local government agencies. Ensure your projects meet eligibility criteria and application deadlines to qualify for these funding programs. Businesses can find additional financial support through the energy efficient commercial buildings tax deduction to offset upgrade costs. Pursuing government grants, subsidies, and tax incentives can help businesses overcome the barrier of upgrade expenses, making energy conservation goals a reality.
Tracking and Monitoring Energy Usage
Energy management and efficiency practices are an ongoing effort. Once your goals are set and systems have been upgraded, it’s essential to track and monitor energy consumption regularly. This practice ensures that your business stays on track to meet goals and alerts you to any unexpected changes in energy use or equipment efficiency.
Consider benchmarking your company’s energy consumption against industry standards. This encourages transparency and accountability within your industry. Benchmarking also helps businesses find energy efficiency inspiration and establish realistic conservation goals based on the experience of similar companies.
Employee Engagement for Energy Conservation
Developing an energy-saving culture in your workplace empowers employees to support conservation goals. Educate your staff on the importance of energy conservation and encourage their participation in simple energy-saving practices. Consider creating incentive programs or competitions so you can reward employees who exhibit outstanding energy-saving practices. Encouraging employees to participate in conservation initiatives creates long-term energy-saving habits with significant cost savings for your company.
Successful Strategies for Energy Cost Reduction
Case Study 1: Energy-efficient retrofits at Daikin Industries
Daikin Industries, a leading HVAC and refrigeration manufacturer, embarked on a mission to achieve net-zero greenhouse gas emissions by 2050. In 2019, they initiated their first project, retrofitting HVAC and lighting systems at their headquarters and manufacturing facility in Dubai’s Jebel Ali Free Zone. This included designing a new, highly-efficient HVAC system that caters to the intense energy demands of their facility as well as implementing an energy management system (EMS) for automated HVAC and lighting controls. The 2019 retrofits resulted in significant energy savings, serving as a baseline for future projects with a targeted goal of an additional 10% reduction in energy consumption by 2020. Daikin’s success has inspired further efficiency projects, including their recent solar panel installation initiative, as they continue to pursue their net-zero goal.
Case Study 2: Implementing smart technologies at Adobe headquarters
In 2013, Adobe had the goal of significantly reducing their headquarters’ energy consumption. In pursuit of energy conservation, they remodeled the office into an innovative, open layout they named neighborhoods and implemented smart HVAC and lighting system technologies. They used zoning strategies for each neighborhood in which their HVAC and lighting would shut down if a neighborhood was unoccupied for more than 15 minutes. By investing in timers, sensors, and energy management software, Adobe was able to reduce their office’s energy consumption by 65%, even as they increased the number of employees from 80 to 135. By implementing smart monitoring software and a thoughtful office layout, they were able to achieve substantial cost savings while keeping their employees’ comfort in mind.
Commit to Energy Efficiency to Lower Expenses
By understanding your business’s energy expenses, optimizing your systems, and embracing energy-efficient technologies, you can significantly reduce utility costs without sacrificing quality or comfort. With the right strategies and a commitment to energy efficiency, your business can thrive while contributing to a more sustainable future. As one of the nation’s leading energy brokers, Integrity Energy representatives are passionate about helping you find the best energy solutions for your business. Don’t hesitate to reach out about customized energy plans today!
Frequently Asked Questions
How can I reduce energy costs without major investments?
Simple ways to reduce energy costs include switching to LED lighting, using smart power strips, installing occupancy sensors, and implementing energy-saving practices among employees.
Are there government incentives for energy efficiency projects?
Federal, state, and local government agencies offer a variety of grants, incentives, and tax credits for completing energy efficiency projects. Ensure you review eligibility requirements and application deadlines to make sure your projects qualify.
What are the most effective ways to optimize HVAC systems?
The most effective way to optimize your HVAC system is by creating an in-depth maintenance schedule with your HVAC technician. Proper maintenance will optimize it for daily use, prepare for seasonal fluctuations, and monitor for inefficiencies, ensuring it is functioning at peak efficiency.
How can employee behavior impact energy expenses?
Implementing energy-saving practices within your staff helps reduce energy expenses and creates an energy-conscious workplace culture that supports your conservation and financial goals.
What are the financial benefits of adopting renewable energy?
Renewable energy provides the benefits of lower utility bills, reduced reliance on the energy grid, and lower carbon emissions. Renewable energy is cost-effective while contributing to a healthier environment.
How do I choose the right energy management software for my business?
Identify specific energy-saving opportunities and create measurable goals for improvement. Once goals are in place, you’ll have a better idea of what energy management software you may need. The more specific and measurable your goals are, the easier it will be to find EMS software to support your objectives.
For additional questions about conservation and the energy industry, visit our general FAQ page.