Funding Energy Efficiency Projects
Right now, capital expenditure funding is under pressure for many organisations. For those businesses committed to energy efficiency and carbon reduction improvements, these financial constraints should not mean you have to give up on your energy goals. In fact, there may be ways to kickstart your energy efficiency projects now by utilising government grants and energy certificate schemes and considering financing options.
On-bill financing gives ERM Power customers an opportunity to turn planned energy-related capex into an operational expenditure by accessing ‘rent to own’ finance for energy projects*. With no upfront capital costs, you could implement your energy solutions now and pay the setup and ongoing costs over time, via your regular electricity account, making payments and tracking easy.
ERM Power can even facilitate the finance application process for our customers to save you time. To understand whether on-bill financing is an option for your business, contact ERM Power today.
Government grants and funding
If you have plans to conserve energy or deliver an energy management project or road map, consider government grants and funding schemes that may be available to help you achieve your energy goals.
Details of the various federal and state government grants and funding programs are available on the Australian Government’s Department of Industry, Science, Energy and Resources website.
We have extensive experience supporting customers to identify potential energy expenditure savings of 10-20% per annum. While your focus is on kicking your business back into gear, let ERM Power focus on helping you reduce the burden of your energy costs. We would be pleased to check your eligibility and help prepare and submit the funding application on your behalf.
Leverage existing energy assets to generate new revenue streams
There are new opportunities available where not only can businesses save money and improve energy efficiency, they can actually leverage their existing assets to generate revenue.
One way is through participating in demand response programs. By adopting load flexibility strategies on HVAC and refrigeration equipment, businesses can reduce their amount of energy and better manage the times that energy is used.
With the installation of smart devices on HVAC and refrigeration systems, businesses can now automatically adjust their energy use at specific times.
Strategic use of HVAC and refrigeration systems now allows businesses to take advantage of demand management opportunities and make use of lower energy tariff options. By automatically controlling HVAC use at peak times, additional revenue can be earned.
We understand customer comfort levels, reliability of products and food safety are fundamentally important to retail businesses. With smart technology, we can now manage the process in curtailing how much energy they use in a way that doesn’t affect customer comfort levels and product safety.
It’s a new way to support businesses in not only deriving additional value from these assets, but also creating new revenue streams that can potentially cater for reinvestment in other energy efficiency projects.
Environmental certificate schemes
Environmental certificate schemes can help offset the cost of energy abatement or emissions reduction initiatives.
Certificates can be created for the amount of electricity they produce or the emissions reductions resulting from the initiatives. Examples include installing solar generation, installing energy efficient equipment (like a more efficient boiler or compressed air system) or installing a controls device, such as a variable speed drive or sequencer, depending on the scheme. The value of certificates can then be offset (via various commercial arrangements) against the cost of the project.
At ERM Power, we assess your energy and financial objectives and eligibility to identify the schemes that may be available and we help you to better understand the value of your energy or emissions savings upfront while you are building a business case for the project.
It is important to consider engaging a trusted and accredited energy advisory before you start your energy efficiency projects as:
- some certificate schemes require baseline assessment of energy use or emissions (prior to the energy efficiency measures being initiated) with certificates only being issued for savings or improvements that are measurable to this baseline
- your energy advisor can provide you with valuable insights into the risks and advantages of certificate schemes
- energy efficiency projects, while providing considerable energy savings for your business that can exceed the cost outlay for the project, often fail to meet their expected ROI without early expert advice. Common pitfalls include having no energy baseline, no consideration of operational risks, or making purchasing decisions that don’t consider lifecycle costs.
Power purchase agreements (PPAs)
PPAs provide a unique way to reduce the level of energy purchased from the grid, reduce emissions and avoid any upfront capital investment.
PPAs allow large businesses to buy electricity directly from the generation source, rather than the electricity grid. Generation sources can be large, such as wind or solar farms, or small, such as a solar PV system. They can be located onsite, or elsewhere and entered into directly with the owner of the generator or via a retailer.
In such uncertain and volatile times, entering into a PPA can be an ideal option for businesses seeking more stability in energy expenditure, without the upfront capital investment in renewable energy generation.
Your next step
A certificate scheme, government grant, solar power purchase agreement or on-bill financing solution should not be considered in isolation when looking to at the real cost of your next investment.
Strategically considering the available options is the right approach to managing your project expenditure.
Engage with your trusted energy advisor to explore whether finance, environmental certificate schemes or government grants may be available for your energy efficiency projects.
Whether you’re starting your energy journey or you’re five years down the track, please call 02 8243 9117 or email [email protected] today to find out how we can best help you to achieve your energy goals.
*On-bill finance is only available while you remain an ERM Power electricity customer. If you are no longer an ERM Power customer, you must make arrangements to pay the credit provider directly. Under the on-bill financing option, ERM Power Retail Pty Ltd will be the service provider and Macquarie Equipment Rentals Pty Limited ABN 44 112 079 268 will be the credit provider. This document does not constitute an offer to enter into a financial transaction with any party. Parties should take their own legal, financial and tax advice before entering into any financial transaction. All applications to Macquarie Equipment Rentals are subject to lending approval criteria, and terms and conditions apply.