Majella Kelleher, head of energy demand management, SEAI
Majella Kelleher, head of energy demand management at the Sustainable Energy Authority of Ireland (SEAI), explains why focusing on energy efficiency is a no brainer for any business
Many businesses fail to spot the link between energy efficiency and the bottom line – €1 saved in energy cost could be equivalent to €20 in sales depending on your business. It is likely to be much easier to save a euro than to generate extra sales of €20.
In addition, while we don’t know the future of oil prices we can be pretty sure they will rise over time, so a company that controls its use of energy use is really future-proofing against the impact of such increases.
Despite these compelling arguments, the implementation of energy saving initiatives in many SMEs in this country still lags behind their larger counterparts.
There are a number of reasons for this. In addition to a poorer understanding of the benefits of energy efficiency, SMEs are diverse and have different requirements for energy saving initiatives. Many are too small to have the expertise or capacity to focus on energy consumption and their resources are stretched as it is.
They face other challenges such as occupying rented buildings with services often included in the rent. The exception here is electricity consumption so this could be one of the starting points and quick wins for SMEs, according to the Sustainable Energy Authority of Ireland (SEAI).
Commitment in the business is key to getting started. SEAI recommends giving someone responsibility for looking at the business’s energy usage and costs and identifying where the big-spend items are.
There’s an easy 10pc in savings to be had from low-hanging fruit, at little or no cost, and this may involve things like switching to alternative electricity providers or changing tariffs.
Changing how energy is used by staff is also important. Behavioural changes such as switching off equipment when not in use, or installing time and temperature controls, can also deliver savings.
Once the easier items are actioned and the business is seeing positive results on the bottom line, further consideration can be given to investing in proven energy efficient technologies. Significant advancements are being made in energy efficient lighting and upgrades to modern LED technologies can reap further savings – as much as 60% off electricity bills – as well as improving the visual work environment.
With almost 200,000 SMEs in Ireland, there is major potential in the sector for energy savings which can be acted upon. SEAI has engaged with over 4,000 SMEs through energy advice, training and assessments and has identified that many businesses can reduce energy bills by as much as 20-30%.
In most cases the size of available savings, when coupled with comparatively short payback periods, combine to make a compelling business case that should make business owners and finance people sit up and take serious notice.
One business that benefitted from SEAI support was Eltex Manufacturing, a small electronics firm based in Co Tipperary. It undertook a review of its facility and services and identified a number of ways to reduce operating costs and improve the internal environment for its employees.
“Eltex is a very ambitious company and we are always seeking ways to ensure the long-term viability of our business. We made a conscious decision to upgrade the facility following the review,” says managing director Seamus O’Dwyer.
“We replaced our lighting and heating and upgraded the building fabric. The end result for us was a higher quality and more comfortable work environment but more importantly we reduced our electricity bill by over 40%.
“We have benefitted significantly from these interventions and my advice to any business is to act sooner rather than later and future-proof the business against the inevitable.”
There are so many companies like Eltex around Ireland. A recent study by SEAI indicated that the sector was spending €2.2bn on energy costs and even at a small 5% saving this would result in a much needed €110m windfall for these businesses – let alone what they might achieve with a 20% saving which is possible.
For businesses looking to get their share of this windfall, SEAI offers lots of information, tools and resources online to help. To get started, visit the business support centre here:
www.seai.ie/business
“Once the easier items are actioned and the business is seeing positive results on the bottom line, further consideration can be given to investing in proven energy efficient technologies”