What is it?
Energy is the amount of power that your business consumes.
It is essential for most companies to function, from running laptops and kitchen equipment
to operating lighting and heating.
The main energy sources used by businesses are electricity (to power lights and appliances) and gas (for heating). These are both usually supplied by the national grid, although some businesses may produce their own electricity and use different energy sources for heating, such as bottled gas or oil.
Energy is measured in kilo-watt hours (kWh). Primary energy sources include nuclear power, fossil fuels (e.g., oil, coal, and natural gas), and renewable energy, such as wind, solar, geothermal, and hydropower.
DEFINITION
Renewable energy
Energy from a source that is not depleted when used, such as wind or solar power.
As energy is a resource and sustainability is about preserving resources, green businesses must focus on reducing the amount of energy they consume and look to invest in renewable energy sources.
Why is it important?
There are many benefits to reducing the amount of energy your business consumes, whether it’s through behaving more efficiently or using renewable energy.
The main benefit is reducing your costs. Energy costs money and, while they are not all the same, the average small to medium-sized enterprise (SME) could save a lot of money – a government study found that SMEs reduced energy bills by 18 to 25% by investing in simple, often low- or no-cost energy efficiency improvements.
Investing in your own renewable energy source (such as wind and solar power) can save you even more money, as you need to purchase less energy from a supplier.
Reducing your energy costs has become even more important given the recent rise in energy prices in the UK. Using less energy will help you better manage the risk of future energy price rises.
There are also big environmental benefits to reducing the amount of energy you consume. Unless it is renewable, producing energy creates carbon dioxide which directly contributes to climate change. The less energy used, the lower your contribution to climate change.
How can I improve it in my business?
Six top tips that you can implement to take control of your energy use, reduce avoidable loss, and cut your energy bills are presented below.
Monitor and manage your energy consumption
Monitor your energy consumption by installing a smart meter. These are free for all businesses, just contact your energy supplier to arrange an installation. This alone can lead to energy savings of up to 10%. Measure your consumption on a monthly basis and keep records so you can track seasonal changes and keep improving operations.
Switch things off when not in use
Switch off all appliances (including chargers) and lights that are not in use. While it might seem small, the cost will add up. For example, switching off a single desktop computer overnight could save between £20 and £50 annually
Use lighting controls
Automate when lights are switched on and off by installing lighting sensors (either those triggered by movement or by sunlight). Light controls remove human error and, on average, save around £347 per year for an investment of about £500.
Adjust your thermostat and boiler temperatures
Turn your thermostat and hot water temperature down by one degree to save on heating bills. Heating costs increase by around 8% for every 1°C increase in thermostat temperature. Lowering your boiler temperature by 1 to 3°C (to a minimum of 60°C) could result in a 30% reduction in gas consumption.
Upgrade any standard light bulbs to LEDs
Replace old lights with LEDs to cut costs. LED lights are by far the most energy efficient. They use up to 90% less energy than standard bulbs and could result in significant cost savings for your business.
Maintain your equipment
Regularly maintain your energy-consuming equipment to help it remain efficient. To keep your heating efficient, ensure that windows are properly sealed and radiators and boilers are serviced regularly. A poorly serviced boiler can increase gas costs by more than 30%.
To keep your electrical equipment efficient, ensure it is cleaned and maintained regularly. As an example: a poorly maintained ventilation system can consume up to 60% more energy.
Downloads
Energy efficiency checklist
Energy costs money and contributes to climate change, so by reducing the amount used, a business can cut its bills and lower its environmental impact.
This checklist provides you with tips and advice on how to reduce the amount of energy you consume.
A case study – Bacchus Hotel
Who is Bacchus Hotel?
The Bacchus Hotel is a 17th century coaching inn, with 23 bedrooms and five luxury log cabins. The hotel is in Sutton on Sea.
What is the business doing?
Three years ago, Bacchus Hotel began investing in modernising its energy supply in a bid to future- proof its energy costs. Since then, it has installed a large ground source heat pump, full-roof solar power, and a battery storage system to store excess energy created by the solar.
While the whole project cost around £400,000, it was partially funded (£47,000) by an energy grant and has dramatically reduced the hotel’s energy costs.
What can my business do?
Have you looked at how investing in energy efficiency could save your business money? Visit the Grant Funding section of this toolkit or contact the Lincolnshire Growth Hub to find out what support is available for your business to invest in energy efficiency.
Since the project began, energy consumption has reduced by over 60%. The system is based on a 15% rate of return meaning it will pay for itself within at least 7-8 years, but rising energy prices will improve the rate of return, shortening the payback period.
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