Yes… Lighting is Your Low Hanging Fruit

Let’s say you’re the director of facilities for a local manufacturer or the business manager for a school district. By now, you’ve likely had a parade of salespeople knocking on your door to sell you a lighting retrofit. Each comes armed with a very similar pitch. Lighting technologies are the most advanced that they’ve ever been. ROIs are up and payback periods are down. And the most overused saying, lighting is your low hanging fruit.

In your job, you have to wade through all the gimmicky sales jargon and back of the envelope math to figure out what’s real and what’s a mirage. The difficulty is you wear many hats, and finding the time to learn the truth is challenging.

Having a clear understanding of your opportunity, along with a defined plan, will help streamline and simplify the process.

First, let’s be realistic. Just because a lighting retrofit reduces energy, doesn’t automatically mean it’s the highest and best use of your capital improvement dollars. As we have previously shared, you should start with a comprehensive facility audit. This will help to determine what projects, if any, you should focus on.

Assuming, lighting is a true cost-saving opportunity, you should understand what the current environment looks like. It is true that LED lighting efficiency is on the rise and costs have continued to decline.  This has made retrofitting your facility more economical than ever before.

However, lighting is no longer as simple as swapping out a light bulb. Advancements in lighting solutions have required the industry to move away from simple one-to-one replacements, opting instead for structured and thoughtful design. This is where it becomes imperative that you work with the right lighting firm that understands your specific needs.

Church Lighting

Many lighting firms still use antiquated methods for installing lighting. Worse yet, some firms attempt to sell you a solution you don’t need, simply to increase project costs. Ultimately, the lighting solution you choose should be unique and customized to your facility. It should incorporate the most efficient and effective design with products that maximize lumens and comfort for employees and guests of your facility.

Don’t be afraid to utilize a design-build process. Your energy advisor can work alongside you to create the right facility design and layout, and then solicit bids for the cost of the fixtures to ensure you receive a favorable market rate.

Opportunities for energy efficiency will continue to increase as technology improves. Surround yourself with a competent energy advisor that will ensure clear, transparent, and efficient energy solutions for you and your facility.

 

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Three Ways to Pay for Energy Efficiency

Recently, I shared with you the importance of crafting an energy plan to help guide your mission of becoming more energy efficient. Having a plan is great way to identify the opportunities in your facility and how best to prioritize your implementation schedule. However, knowing what you should retrofit and subsequently how you will pay for it, are two very different objectives.

In today’s economic climate, finding discretionary dollars to pay for energy efficiency upgrades is challenging to say the least. Typically, for most businesses, only a fraction of total operating expenses are energy related. Each fiscal year, when evaluating capital expenditures, energy projects tend to rank pretty low.

EPCO understands the financial concerns and restrictions our clients face. Part of our value proposition is to cultivate and leverage any and all incentive opportunities that exist in the market. Below are three essential and easy steps, to be packaged with your project, that will help lessen installation costs, increase project ROI, reduce payback periods, and amplify net savings.

Utility Procurement

Most consumers are content to simply sign a multi-year contract and never think about their utility bill again. This can be a costly mistake, especially for larger consumers. Negotiating a lower rate by even a few cents can yield significant value. In addition, it is very likely that at some point, now or in the future, an error on your bill will occur.

Think about the number of residential, commercial and industrial customers served by your utility.  Statistically, a mistake is bound to happen. Be sure to work with your energy advisor to review your billing history for any anomalies or incorrect charges. When billing errors are found, the money owed to you by your local utility can be reinvested into your energy project.

Rebates, Tax Credits, & Grants

Many utilities and state funded agencies offer a host of incentives, rebates, credits and grants to specifically help fund energy efficiency. Some of these opportunities do carry restrictions based on your industry, geography, or annual consumption. Other programs are publically available to all. The important point here, is to work with a professional energy advisor that is well versed on the available programs and application processes.

Traditional and Non-Traditional Financing

This is the most critical part of the implementation process. No longer are businesses relegated to merely two financing options; using one’s own capital or traditional lending institutions. Popping up around the country are these novel and creative alternative financing mechanisms. They leverage the net savings of your project and structure the loan terms as a service agreement. This allows you to fund the project with little to no money out of pocket and treat the payments as you would an operational expense.

In the end, the reduction you enjoy in operating expenses means more dollars toward increased productivity, better employee wages, and more revenue. The opportunities are certainly out there. Talk with your energy advisor today about how you can become more energy independent.

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Four Steps to Reducing Inefficiency in Your Building

Is your facility as energy efficient as it could be? How does your energy rates compare to current market conditions? Do you have equipment and systems needlessly using energy when off-cycle? These are more difficult questions to answer than most would think. Many clients I work with are wearing multiple hats each day. I am confident you are too. It’s extremely challenging for them to keep up on prevailing technologies or fluctuating rates while trying to juggle production schedules and personnel.

An essential tenant of the EPCO philosophy to energy management is having a comprehensive plan to guide you. Your energy plan should be a holistic approach to the energy consumption of your facility.  Utilizing a long-term lens, EPCO designs a plan that factors each component comprising your specific energy fingerprint. This includes how you use energy, when it’s consumed, and most importantly, where you can save without disruption to your operation. As great as this may sound, the next logical question is, how do I create this plan?

EPCO has simplified the process into an easily digestible four-step approach.

  1. Identify your pain points – Work alongside your energy advisor to understand, from your perspective, the energy-related issues you are facing. This could be as a simple as utility billing errors or ineffective lighting to more complex issues such as process cooling / heating and heat reclamation.
  2. Perform an ASHARAE Level Audit – A facility Audit is a great step towards realizing your simple payback. Whether it is an LED upgrade, automated controls, or mechanical equipment retrofit, an audit provides the facilities baseline data needed to understand your opportunities.
  3. Prioritize the Data – Following the audit, review the data to determine where the most substantial and relative savings exist. Cross reference the pain points you first identified with each proposed solution. Calculate what the capital costs are in relation to energy savings. And be sure to leverage incentive and financing opportunities.
  4. Draft and Execute Your Plan – Once you have determined the value and importance of each solution, your energy advisor can work with you to implement each identified energy savings opportunity. Start with the highest prospective paybacks so you can reinvest those savings into more energy intensive projects.

A carefully crafted energy plan will empower you with the ability to more seamlessly manage your energy portfolio. Whether you move forward immediately with each measure, or wait for a more opportune time, you will be better informed and prepared.

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