Planning The Key To Managing Energy Prices
Australian businesses are failing to seize the opportunity to take control of their energy consumption, despite the increasing cost of electricity being their most pressing concern, new research from ERM Power shows.
The research, conducted for ERM Power by MCR (Market and Communications Research)* reveals that only four in ten businesses surveyed have in place, or are working on, a formal energy management strategy, and only two in ten have KPIs related to energy or sustainability.
With energy prices forecast to stay high and the prospect of a long, hot summer, ERM Power says it is imperative businesses actively seek out ways of maximising their energy productivity.
Executive General Manager Energy Solutions Megan Houghton says the opportunity cost in the current market is too high for business not to take action.
“Electricity costs have as much as doubled over the past 12 months and the outlook for energy prices is to remain high, compared to past years. Meanwhile, technology options are rapidly developing and becoming more commercially viable, enabling businesses to take even greater control on their side of the meter,” she says.
To get more out of their energy, CEOs and boards must ensure they have an integrated energy management plan that draws on the company’s unique data.
“Energy efficiencies can point to where there’s opportunity for cost savings, often with minimal intervention. They will help businesses improve their energy productivity,” Ms Houghton says.
Businesses perceived energy management as complex, and understanding product and technology qualities, payback periods and measuring performance can be difficult.
ERM Power’s unique dual perspective – as an energy retailer and provider of energy management solutions – helps businesses determine what is best for their business, and understand the consequences of changing their load profile.
“A customer’s usage will dictate certain aspects about how they should manage their energy and what combinations they should consider to improve energy productivity – there is a real balance of consequence that requires an integrated view,” Ms Houghton says.
Effective energy management plans must acknowledge a business’s unique energy usage and identify ways of effectively deploying their capital. Demand response programs, for example, reward businesses that switch to alternative energy sources, such as their own generators, during peak demand periods.
Ms Houghton says businesses are increasingly approaching ERM for plans addressing four common goals – cost reduction, environmental targets, security of supply and creating value from their energy assets.
Integrated energy management solutions provide clear and measurable benefits.
“With one public sector customer, we conducted energy audits across multiple sites identifying savings of 25% on average per site. We’re now working with them on an integrated roll-out of a combination of technologies including solar and lighting to realise those savings for their business.”
Ms Houghton says the solution for businesses in improving energy productivity is a thorough review of their options and the development of a clear evidence-based, data-driven plan. “Developments in sensing and controlling, for example, give us information that is increasingly sophisticated, more accessible and more granular. We know more, so we can do more.”
Ms Houghton says every business is different and there is no ‘one-size-fits-all’ to efficient energy management or increasing energy productivity. It’s important businesses undertake energy initiatives in the right order to ensure the best solution and the best use of capital. “You need to tackle energy efficiency first if you are interested, for example, in the right sized solar system for your business – make sure you lose the weight before you buy the new suit.”
ERM Power offers an integrated and end-to-end portfolio of energy management solutions and services including:
- Advisory Services
- Data Analytics
- Demand Alerter
- Demand Response
- Energy Audits
- LED lighting
- Network Tariff Optimisation
- Power Factor Correction
STEP online – strategically timed energy procurement
*Market research study (qualitative) conducted by independent researcher Market & Communications Research (MCR) during July and August 2017 surveying large organisations/businesses in the National Electricity Market.
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About ERM Power
ERM Power is an Australian energy company operating electricity sales, generation and energy solutions businesses. The Company has grown to become the second largest electricity provider to commercial businesses and industrials in Australia by loadi. A growing range of energy solutions products and services are being delivered, including lighting and energy efficiency software and data analytics, to the Company’s existing and new customer base. The Company operates 662 megawatts of low emission, gas-fired power stations in Western Australia and Queensland.
iBased on ERM Power analysis of latest published information.