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Energy Savings for Corporate Efficiency

August 30, 2013

Kevin T. White, CPA
Partner

As a business advisor to my clients, I often discuss with them ways to improve their businesses such as optimizing their business processes, maximizing growth opportunities and managing profitability in a shifting tax landscape. But I also encourage my clients to take a closer look at all of their expenses — including utilities — in which they can find six-figure cash flow savings as close as a light switch away.

Energy Audits

An energy audit is one example of an evaluation that can uncover areas in which major changes are required, and there are many options available to reduce costs without an expensive up-front investment.

Currently there are great energy saving opportunities available that can reduce business utility bills by thousands of dollars annually. These savings apply equally to manufacturing operations, distribution and warehousing companies, multi-location retail chains, parking lots and office space in addition to non-profit organizations. 

The combination of the new technologies and incentives provided by utility companies makes it worthwhile to perform a reassessment of current energy costs. While the process of auditing a firm's energy costs, selecting appropriate replacement systems and applying for rebates may seem somewhat overwhelming, there is professional help available.

Companies such as Granite City Electric, headquartered in Quincy, MA, with offices throughout New England, offer full-service assistance with achieving energy efficiency for both interior and exterior systems. This includes an initial on-site audit, lighting assessment, installation of new equipment and completing the all-important paperwork to qualify for rebates.

One of the most overlooked sources of energy savings is lighting, which presents a significant operating expense in existing buildings. By upgrading lighting, owners can improve the economics of their buildings through both annual savings and financial incentives.

Granite City Electric representative, Bob Pisacreta, says that once his firm completes an energy analysis they are able to recommend replacement fixtures and systems, arrange for installation and complete the rebate process. By reviewing the audit report, businesses can easily see how much can be saved by replacing inefficient systems.

"Everything we recommend is going to reduce energy consumption, which results in lower costs," he says. "Then you get a rebate on top of it. Why wouldn't anyone do this?"

The savings involved can be substantial. For example, a parking garage was paying $94,000 annually for electricity. The owners of the garage hired Granite City to recommend replacement systems.

The result, after replacing the original lighting with modern technology, was a reduction in annual lighting costs to $44,000.  The cost to purchase and replace the lighting was $35,000 after $124,000 in rebates from the electric utility.  In total, the garage owners will realize a net savings of more than $300,000 in seven years.

One of the most effective ways to reduce energy consumption involves electronic controls that turn off or dim lights when conditions allow. There are a variety of control technologies available, offering solutions for a wide range of applications and spaces.

These include occupancy sensors, which are added to existing lighting, especially in areas that are not in constant use, such as restrooms, storage areas and conference rooms. Other controls regulate lighting based on available sunlight, dimming or turning off lights when the level of natural light allows.

These advances can be used in conjunction with addressable systems, allowing users to individually adjust lighting levels in their own workspaces, improving comfort and increasing productivity, while reducing energy consumption.

To assist businesses in becoming more energy efficient, utility companies, such as National Grid, also provide a wide range of technical guidance for upgrading the efficiency of existing lighting, as well as offering financial incentives.

However, lighting is just one of many options available to reduce energy bills. New technologies are also available for refrigeration systems in addition to heating, ventilation and air conditioning (HVAC). HVAC costs can be significantly reduced using upgraded technology, and many utilities offer incentives to install the upgraded equipment as well. For instance, Mass Save®, an initiative sponsored by Massachusetts’ gas and electric utilities and energy efficiency service providers, works closely with the state Department of Energy Resources to provide services, incentives, training and information promoting energy efficiency.

Businesses, as well as building and trade professionals, have a direct investment in creating more energy efficient communities. The combination of public and private sector assistance makes the question of whether to conduct an energy audit and retrofit existing buildings and offices an easy choice.

For more ideas on improving the operating efficiency of your business, contact Kevin White, partner at BlumShapiro, (781) 610-1205. For more information regarding an energy audit, contact Bob Pisacreta at Granite City Electric, (617) 221-1339.

 

Advisors | Auditors | Consultants | CPAs - Blum Shapiro is one of the premier public accounting firms in the northeast and a Top 100 CPA Firm in the U.S. Our professionals serve businesses, individuals and organizations in Boston (MA), Hartford (CT), Cranston (RI), Shelton (CT) ,Quincy (MA) and Newton (MA) with audit, tax and business consulting services. Our firm has developed practice areas in automotive, construction, education, government, healthcare, hospitality, manufacturing, nonprofit organizations and professional service firms. New Haven CT, Fairfield CT, Norwalk CT, Waterbury CT.