5 Ways To Deal With High Energy Costs
You don’t need to be reminded. At the gasoline pump and with your utility bills, energy costs are going up at unprecedented rates, affecting your personal and company’s pocketbook. Most people get their energy bills (themselves or for business), curse a little, then shrug one’s shoulders and have Accounting pay it. But there are things you can do about high energy costs – and succeed. Energy costs won’t disappear, but you can do better – and get ahead of your competition.
1. You do have some control over costs. Understand what your energy bill is made of. Most utilities are regulated by a government entity because they are monopolies when it comes to delivering electricity or natural gas. Con Edison, the largest utility in the nation, just requested a fee raise of 10-15%, if approved by its overseeing agency, beginning in 2023. You, as the public, can certainly let your local commission know your thoughts about any proposed high rate hike. But that’s just delivery. Supplying electricity and natural gas is a different item, and that has gone up about 40% in the last year.
You, the user, can pick your supplier. Yes, you can. In fact, if you don’t pick a supplier for electricity and natural gas, the utility will pick one for you – and it’s not likely to be the cheapest! Take time to research suppliers. Many utilities have links on their website. Compare prices, and there is a good chance you’ll find firms who will supply electricity and/or natural gas at a lower rate than what was assigned to you. Saving $0.02 / kWh, seems small, but is a substantial savings. If you’re a large user (lots of refrigeration or a factory), the potential savings is greater; it would be worth it to retain an energy supply broker, who can get bids from many suppliers who would slash their price to supply a large user like you so much electricity or natural gas. You can save substantially. And you may have the opportunity to lock in a low rate for price security.
2. Are you being billed properly? Take some time to review your utility bill. Your utility sends out thousands, maybe hundreds of thousands of bills monthly. Don’t you think some are in error? Review your latest bill. Are you classified correctly? Are the tariffs and other charges appropriate for you? It does not happen often, but utilities sometimes get it wrong. A religious institution was classified as a large industrial facility. Their office never noticed this and just paid the high bills for decades. When the error was brought to their attention, it was corrected for the future and they received a check from the utility for $78,000 for the historic overcharge. Now, that’s some donation!
3. Are you being wasteful? We know it’s important to produce your product or service of high quality and reliably. But might your processes be wasteful? While redundancy is important in many industries, could operations be overdone? For example, a facility needing hot water for a process uses an appropriately-sized hot water tank, a backup tank, and a backup to the backup tank. It was calculated that they spend $50 / month to keep the water hot 24/7 in the backup to the backup tank. I suggested that they probably never use the hot water from the backup to the backup tank; the $50 / month was wasted. I suggested they turn off the heater for the backup to the backup and if it’s ever needed, then turn it back on for good. They did turn off the heater and never had to put it on again. Another example: lighting. We are concerned with dim areas; is there enough light to perform tasks well and safely. But might there be too much light in an area? This is not only wasteful, but may cause issues, such as glare and distractions. Remove lights from fixtures in overlit areas for a nice energy usage and cost savings.
4. Renewable Energy. Might you be a candidate for solar panels, geothermal, etc.? Get energy from a source that is free (the Sun, the stable temperature of air underground). There is an investment needed to set up and support the technology, but the source of power is free (unlike natural gas or oil), and thus, should be a useful way to reduce electricity or gas/oil usage in the future.
5. Finally, an energy audit. Simply stated, there has been a literal revolution in gains in energy efficiency in many products the last five years. If an energy audit has not been performed in that time, there will be opportunities. Gains in efficiency of space heating and cooling equipment; lighting; heat pumps; an electric fleet. Have an energy audit performed by an experienced professional. Look at the list of potential strategies and take them seriously. Yes, you’ll have to invest money upfront to procure and install the technology, but you will save handsomely and get your investment back and more. Remember, incentives probably exist from your utility or state government to possibly pay one-third, maybe half the cost for these energy-saving technologies (they want you to save, too). And low-cost loans exist if cash is not readily available. Banks will compete to lend you money because they know energy-saving projects are more reliable for them (the payback to you) than loans for other purposes.
Will these moves reduce your energy costs to zero? No, they won’t. Reduce them by 50% or more? Probably not. But they can definitely take the edge off the big increases in energy costs most are enduring and put you in a more competitive situation.
CCES has the experts to help you navigate through all of these ways to save energy costs as a hedge to inflation. We can work with you and find significant savings. Contact us today at 914-584-6720 or at karell@CCESworld.com.