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As one of the leading utility consultancies in the UK, Business Cost Consultants is regularly quoted in news and trade press. Below you will find recent press coverage on Business Cost Consultants. Please email us if you would like to find out more about the content of these stories or if you would like to discuss how Business Cost Consultants could help your organisation in similar ways.
Targeting Climate Change
Monday, October 16, 2006
With CCL targets becoming more challenging, Donald Maclean discusses how organisations can ensure they meet their environmental obligations.
The Climate Change Levy (CCL) tax, introduced in April 2001, was intended to play a major role in helping the UK to meet its targets for reducing greenhouse gas emissions. It was hoped that, by adding about 10% on to energy bills for all non-domestic users, large energy users would reduce their consumption and hence their carbon emissions.
Two aspects of the CCL scheme have worked well. Many heavy energy users have been able to join industry association schemes, for example The Food & Drinks Federation scheme covers most food producers. If an organisation is a member of the Federation and agrees to reduce its energy consumption over a 5 year period, it is granted an exemption of up to 80% in the CCL. Over the years the industry association schemes have helped businesses reduce their energy consumption significantly. This has saved millions of tons of carbon and other greenhouse gas emissions.
The second part of the scheme is the free Action Energy Surveys. These have worked equally well. They are paid for by the Carbon Trust, which is given substantial amounts of money by the government through the CCL. If an organisation spends over £50,000 per annum on its energy, it is entitled to apply for a free Action Energy Survey. This means that a trained energy conservation consultant carries out a survey of the organisation's site or sites. The more the company spends on energy, the more of the consultant's time it is allocated. His report prioritises the actions which will enable the company to reduce its energy consumption. Those measures which require the least cost and produce the biggest reductions are listed first. Those which require a high investment and have a long payback period come at the bottom of the list. Energy savings of 10% to 20% are not unusual.
Many organisations in industry exemption schemes found it quite easy to comply with the CCL targets in the first few years, because the targets and benchmarks were not too challenging. However in recent times, more challenging targets have been set. These new, more demanding targets, together with the large rises in energy costs, have created a growing need for close monitoring and reduction of energy consumption, and it is now more crucial than ever to explore every avenue where savings could be made.
A key way for businesses to save energy is monitoring and targeting. This can be done in-house by keeping track of all energy bills, taking regular meter readings and noting how they change when energy-saving measures are introduced. It is necessary to accurately measure existing energy costs (to benchmark) before you can move on to identify inefficiencies and target lower energy consumption.
If your organisation lacks the time, the technology, or the resources to accurately measure its energy usage, it is possible to commission an independent utilities consultant to track and manage energy consumption on your behalf. Some are willing to take up the challenge and be paid on a contingency basis. These consultants have recently seen a sharp increase in demand for their services, and senior personnel, such as managing directors and finance directors, are increasingly seeking their help.
New technology systems are also emerging which offer "smart metering" or "smart data loggers", which collect metering data very accurately and very frequently. This allows consultants to accurately monitor electricity, gas and water consumption and use their expertise to analyse the data. The main objective is to search for inefficiencies in the use of energy and water. Reducing the wasted energy and water can lead to dramatic savings in energy and water costs and carbon emissions.
The use of these devices, coupled with expert analysis, can help organisations quickly spot problems such as undetected gas or water leaks which if left unchecked can be hugely expensive. Such systems can also measure consumption in different areas of a building even where the utility supply is coming from a single source. A multitude of reports can be produced from these systems tailored towards the needs of the organisation so that areas of inefficiency can be identified quickly and rectified. In addition, the software is now so sophisticated that emails or text messages can be sent out by the system if energy or water consumption exceeds or falls below set figures.
There are several steps that your business could take almost immediately - often at no or low-cost - to improve energy efficiency and reduce your energy bills. These include simply switching off equipment when you're not using it. According to the Carbon Trust, offices waste £6,000 on average each year by leaving equipment such as computers and lights on over weekends and bank holidays. Simply distributing a memo reminding employees to turn their monitors or lights off before they leave can make a difference to your organisation's energy costs. However, smart data loggers will provide you with the proof that equipment has been left on.
By applying these energy management measures, you will ensure that your business meets its own targets, or those set for them under the CCL exemption schemes, and will prevent your firm from falling behind on its commitments to save energy. To do so could result in ejection from industry schemes and the loss of its 80% exemptions. With the current high energy price levels, this loss would be much more painful than in 2001, when energy prices were relatively low.
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