Unlocking energy savings through an Energy Services partner
Energy costs in buildings account for a significant amount of the operational budget for building owners. This applies right across the spectrum of building types including retail stores, public buildings, office spaces and also to industrial and manufacturing environments. What makes energy costs interesting from a business point of view is that they can be significantly reduced without compromising the occupant’s experience through the use of smart low-energy technologies and enhanced energy management.
Upgrading a buildings lighting systems to LEDs offers an excellent opportunity to reduce costs without incurring any disruption to your operations. LEDs produce the same lighting as conventional systems (such as fluorescence), at greatly reduced running cost, up to 70% in some cases.
LED lighting is now a mature and proven technology both in Ireland and around the world and there are a large number of commercial and industrial buildings who have successfully retrofited to this new lighting technology. An additional benefit is that as the fittings generate far less heat they also last longer, which also significantly reduces the maintenance requirements and costs. This effect helps to reduce the number of breakdowns and the lifespan of the lights which keeps the building brighter for longer and improves the customer experience.
Surprisingly, for such a significant cost saving opportunity, wide scale adoption is still relatively limited in commercial and industrial buildings. When asked potential customers often give a number of reasons for this, they include;
- The capital required to carry out the upgrade is unavailable;
- They don’t have the technical skills to procure and project manage the installation of new low energy technologies
- They question whether the business case can be delivered through the traditional tendering process. Delivering a good energy savings project often requires a greater depth of understanding than a standard upgrade or retrofit project.
Partnering with an energy services company
One way to unlock significant opportunities from your energy costs is to partner with an energy services company which deliver a range of energy management services like lighting and heating upgrades. These energy savings initiatives can be funded by the energy services partner with a service fee paid by the customer . This service fee is generally less than the saving delivered by the project which makes it commercially attractive from day one.
This one stop shop approach to designing, delivering, managing and financing the project gives the customer the ability to deploy new technologies without using their own capital. The energy services company may guarantee the savings through the life of the project which further reduces the technical and operational risk to the customer.
To help customers manage the savings over the life-time of the project, energy service companies typically use a very structured approach to how they assess the opportunities and will often look to deploy a structured energy management system (e.g. ISO 50001) with their customers.
ISO 50001 Energy Management System Implementation
ISO 50001 Energy Management System (EnMS) is based on the ‘Plan-Do-Check’ management system model of continual improvement. The purpose of this standard is to enable companies to establish the systems and processes necessary to improve energy performance. The ISO 50001 model provides a framework for companies to:
- Develop a policy for more efficient use of energy
- Fix targets and objectives to meet the policy
- Use data to better understand and make decisions about energy use
- Measure the results
- Review how well the policy works
- Continually improve energy management
Strategically selected energy performance indicators and the resulting metering plays a critical role in the “Plan and Check” section of the ISO50001 process.
Lighting upgrade with no capital outlay
When considering a lighting upgrade to a commercial property It is preferable to carry out a full lighting review so that any changes taken since the original design or alterations to the use of the space are taken into account. In the example below, a lighting redesign was carried out in order to minimise the number of fittings and to replace the existing florescent fittings with more energy efficient LED fittings. Where appropriate an adjustment to lux levels was applied to ensure areas were not over or under lit. This resulted in 58% reduction in annual electricity equating to approximately €27,131 in savings.
The project took place when the property was unoccupied so that day-to-day business was not interrupted. The installation and commission period for this project took approximately 2 weeks.
Projects like this can be delivered using a “lighting as a service” model. Projects structured in this way allow the building owner to immediately reduce their energy and maintenance costs without any upfront capital investment. Customers also avail of guaranteed savings and enjoy additional non- financial benefits such as improved light levels and enhanced environment for occupants and users of the commercial space.
Case Study: Tesco
ESB’s Smart Energy Services began a partnership with Tesco in 2016 to deliver an ambitious plan for energy efficiency projects and energy management measures across all 149 Tesco stores in the Republic of Ireland.
“In total, we have now retrofitted 76 stores with high-efficiency LED lighting. We have also enhanced the control and operation of the lighting, refrigeration, heating and ventilation systems across the Tesco retail estate,” said Ronan Geraghty, Customer Solutions Manager, ESB Smart Energy Services.
These upgrade projects will help Tesco to improve its sustainability by making significant reductions in energy consumption. To illustrate the level of improvements made, as a result of the projects undertaken as part of the partnership, Tesco will see reductions of up to 25% in their energy costs.
Speaking about the project, Patrick Duffy, Construction and Energy Manager at Tesco Ireland said “Working collaboratively with the ESB’s Smart Energy Services team has provided us with the Innovation we need to substantially reduce our energy consumption and improve the look and feel of our stores. We’ve also made significant progress towards our renewable energy goals; we’re very proud that all electricity used in the Irish business has been procured from renewable sources since 1st April this year.”
Now there’s a win-win project!
To successfully deploy new low energy technologies and ensure that the business case is delivered requires new management systems and a cross functional team including experts. By partnering with an energy service provider, companies can benefit from guaranteed savings and to leverage from the expertise of specialised energy management teams. This approach allows the building owner to ‘derisk’ the project and to guarantee immediate savings with no capital outlay. As with all partnerships though, the careful strategic selection of an energy services provider is critical to the success of the project, so choose wisely!
About the Authors
- John Walsh is the Head of ESB Smart Energy Services which is a business unit of ESB Group and delivers managed energy services and related funding solutions to large energy users in Ireland and the UK.
John has previous experience as the energy manager for some large multinational companies and in a number of innovative technology and business start-ups.
- Ronan Geraghty is a Customer Solutions Manager with ESB Smart Energy Services. Ronan has over 15 years’ experience in the energy and engineering sectors and he helps customers to identify and implement the right energy measures to suit their needs.
About ESB Smart Energy Services
ESB’s Smart Energy Services go beyond that of a regular energy consultancy. As well as identifying energy solutions and opportunities for large energy users, we implement them too. Working with us is a collaborative journey; a partnership that leads our customers to discover new opportunities and those valuable gains that come from using energy like never before.
Our energy services and solutions adapt to the most demanding energy environment. Large industrial and commercial companies that we partner with enjoy high returns from implementing an energy management plan with technologies like LED lighting, Combined Heat and Power, demand response, electric heating systems and deployment of efficient pumps/motors. These technologies are becoming more cost effective all the time and when deployed by an experienced energy team the savings generated are guaranteed.
For more information visit esb.ie/smartenergy.