Reducing energy costs Featured

7:00pm EDT December 26, 2008

The days are long past that energy was so

cheap you could afford to waste it. Now,

financial and environmental concerns have

made saving energy a priority for every

business. When done right, you can expect

to achieve a savings of 20 to 30 percent off

your current monthly utility bill, with minimal investment.

Getting started on saving can be as simple as making employees aware that energy efficiency is a priority for your company. Employees who regularly turn off

lights and computers at home don’t bring

that same mindset to work. By recruiting

employees to help manage your company’s energy usage, you can start to save


Fifty-three percent of readers surveyed

by Smart Business say they expect energy

costs to continually increase over the next

12 to 18 months. A dedication to energy

efficiency is necessary to maximize savings, as energy experts say halfhearted

efforts get halfhearted results.

“Businesses often don’t realize they are

being penalized by power companies for

excessive energy consumption even

though it appears in black and white in the

monthly statement,” says Mike Wissman,

president, Northern Kentucky Electric

Service. “This above all other reasons warrants energy conservation.”

Why managing energy use is


Energy efficiency is a prime example of

what you don’t know can hurt you. Few

people are aware that energy-efficient business desktop computers are available that

cost about $10 a year to operate and are

about 75 percent more efficient than typical PCs. Installing certain models of smart

thermostats allows you to program them

wirelessly through the Internet, allowing

for temperature adjustments without physically being at the facility. Also, new smart

electric meters translate energy wattage

use into dollars and allow you to track

energy use online.

Applying new technology can help, but

don’t overlook the traditional things.

“When initiating an energy-efficiency

plan, start with simple things like super

insulating walls and ceilings, lighting systems, replacing single-pane windows, and using ENERGY STAR appliances,” says

Steve Melink, president, Melink Corp., an

energy solutions company. “An average

Cincinnati building costs $2 to operate per

square foot annually, but being energy efficient can reduce that to 50 cents.”

ENERGY STAR, an Environmental

Protection Agency and U.S. Department of

Energy program, along with your utility

provider and local city hall can help you

reduce energy waste by providing regional

energy-efficiency tips, financial incentives

and energy audits of facilities. ENERGY

STAR endorses more than 50 types of products, which are identifiable by a label that

indicates the amount of energy it will

require during average use and will tell you

the savings you can expect by choosing

that product over products that aren’t

approved by the ENERGY STAR program.

Purchasing the proper equipment and carrying out good habits will reduce your

energy expenses exponentially. For example, you will use 30 to 35 percent less energy using an ENERGY STAR battery charger or power adapter over conventional


“A lot of times, there’s no handle on energy efficiency and energy costs at the CEO

level,” says Chris Sharpe, lead product

manager, Duke Energy. “Upper management needs to get involved and start

benchmarking their facility against others.”

By changing purchasing habits and being

more cautious of efficient equipment operation, you’ll immediately reduce your energy bill. By purchasing ENERGY STAR-qualified products, you’ll use about half the

amount of electricity that would be used

without the efficient product. For example,

when a computer is placed in sleep mode,

it uses 75 percent less energy and a copier

uses 40 percent less energy.

Most businesses use 25 percent of their

energy on lighting. Compact fluorescent

bulbs last longer than traditional bulbs and

use 75 percent less energy. Even if it means

renovating your entire lighting system,

you’ll see a return on your investment in

anywhere from five months to three years.

What you need to know

Performing an energy audit of your business is the first step. This is often performed

for free or at a minimal cost through your utility provider. In this audit, you’ll learn

what areas of your business are using the

most energy. You’ll then be able to work on

a strategy to reduce waste.

By visiting the ENERGY STAR Web site at, you can compare your

company’s energy use to similarly sized companies within your industry and region.

“Your utility company is the first place to

look for guidance when looking to become

more energy efficient,” Sharpe says. “Many

offer incentive programs and can direct you

to other organizations who offer rebates to

make the energy-efficient transition more


After your energy audit, you’ll need to

strategize a plan of action and goals, and

then formally deliver the message to


“You first need to survey your facility to

determine which, if any, components will

need upgraded,” Wissman says. “Next, set a

goal for the amount of feasible reductions

you want to achieve with help from your

utilities provider or ENERGY STAR. Then

set a budget based upon payback time for

the savings.”

Assigning an employee to manage energy

initiatives and communicate them to the

staff will help keep everyone involved and

informed about the process. You may want

to take things a step further and provide

training to employees that can explain

operating methods and procedures to

reduce energy use, along with ways to

monitor and report collected data. ENERGY STAR provides free online training sessions for employees and is a good place to


“Seek employee education through your

utility provider, ENERGY STAR or city

hall,” Sharpe says. “Educating your staff

can even be as simple as finding a reputable local source through an online


“Energy costs are predicted to continue

to rise, so looking at ways to streamline

your energy use now is a smart move.

Many companies are inadvertently sloppy

with use and have formed bad habits of

energy use that really hit the pocketbook.”

When establishing a project timeline,

consider attainable energy grants, rebates

and tax breaks weighed against necessary

operational changes to accomplish goals.

Once you know what you need to change

to be more efficient and what finances you

have available, you’ll be able to better chart

progress and predict the time frame for the

return on your investment.

“You can save 10 to 25 percent on energy

bills by being more energy conscious and

another 25 to 50 by utilizing the best equipment and materials,” Melink says. “You can

go down to nearly zero dollars by using

renewable solar and wind — after the time

elapses for the return on your investment.”