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.
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.