New property development has expanded our sprawling cities.  Quaint suburbs have been sub-divided into units and town houses.  High rise apartment living is dotting the skyline.  It should be no surprise that infrastructure struggles to keep pace.

SGS Economics & Planning economist Terry Rawnsley’s view is that high density living needs to be more strategic, with growth focused in clusters of activity centres, where infrastructure and shopping already exist.

With this in mind, cost and environmental & social impact are key considerations when it comes to energy supply to high density property.   Areas owners should focus on are:

Contract Negotiation

Traditionally, the building owner has only been responsible for public lighting and power.  This can be very low energy usage, for example hallway lighting.  Property managers have learnt that tendering a volume of properties together is of more interest to an electricity retailer and use this buying power to negotiate lower rates.

Dedicated shopping centres and high density living are now typically supplied through what is called an “embedded network”.  Under this structure there is one supply point from the electricity grid servicing the whole facility.  This is supported by an internal network with tenant metering, which is managed and billed by the owner’s agent.  With the electricity use of public facilities and tenants combined, the owner is effectively now a large energy consumer, which provides buying power for negotiation.  There have been concerns over the rights of the tenant under this structure, which have been addressed through the Australian Energy Market Operator’s (AEMO) Power of Choice legislation. This legislation enables a tenant to opt out of their embedded network’s retail supply agreement by installing a second meter and contracting directly with an electricity retailer, though this can be cumbersome to put into practice.

Network Tariff Optimisation

Network Operators charge customers for providing and maintaining the infrastructure (poles and wires) that allows distribution of electricity to their property.  These charges (tariffs) can be structured in many ways, for example, single or time of use rates for kWh’s used, kW or kVA demand rates for the highest demand value over a particular time period and or a daily supply charge.  For large electricity users the charges are itemised, but for small users, they are bundled together with retail and government charges.  As tenancy and energy usage changes at a property, a network tariff optimisation review is recommended to ensure that the lowest cost option is maintained.  The network operators review tariff rates every financial year.  Therefore, it is recommended to review network tariff at least annually as this has proved to reduce electricity bills for some customer by thousands.

Energy Management

Many new facilities install a building management system (BMS) which automatically monitors and controls many things, such as room temperatures within set points by time, water temperatures at set points by time, light levels based on ambient light, movement and time.  Where faults are detected they can also automatically determine the problem, create maintenance jobs and schedule a contractor to attend.  Buildings that do not have a BMS can install a simpler Energy Management System (EMS), which enables circuit level and power point monitoring and control.  This can also significantly reduce electricity bills by turning equipment off when not in use, controlling set points for heating and cooling, as well as timing equipment use to lower cost charging periods - coinciding use for example, with solar generation or off-peak tariffs. Being smarter about how and when electricity is used can significantly reduce costs.

Heat and Cooling

Significant advances have been made in the energy efficiency of heating, ventilation and air conditioning systems (HVAC), particularly gas and heat pump systems. Entry points and windows are typical areas of focus for reducing a building’s areas for energy loss or transfer.  Many buildings now have automatic and self-closing doors.  Windows can be double or triple glazed and thermally broken (isolated).  For a lower cost option, owners have installed window tinting. More recently, a Japanese nanotechnology has been introduced into Australia at a comparable cost to tint. This is a clear coating, painted onto glass and bonds at a molecular level.  It blocks infrared radiation and UV radiation, but is transparent and does not impact the view or the window appearance.

Lighting

An LED lighting retrofit can immediately reduce lighting costs by up to 80%.  In several states, government incentives are in place to reduce the cost.  This is a quick win for lighting cost savings, with typical payback periods ranging from 6 months to 2 years.

Smart LED lighting is new technology that has recently been introduced to Australia for commercial premises.  This brings further benefits to an LED install as light levels (lux) can be automatically varied for one, or many grouped lights, based on the environment, motion detection and time of day.  This technology also brings added benefits, for example fault detection alerts and reports on high or low traffic areas in a facility.

Car Parking

With 2.1 million electric vehicles sold globally in 2018 the move to electric vehicles seems inevitable.  Though not quite as fast to adopt this technology in Australia, installation of charging stations is attractive to tenants and will become a necessity in the future.  Many shopping centres have already invested in this technology, offering free charging to incentivise longer time spent in the centre.

Technology already works seamlessly with charging stations, with mobile apps and car navigation systems showing drivers available spaces to top up at.  They also enable an owner to monitor the performance and use of their fleet of chargers and charge a fee for usage.  In the not too distant future, bi-directional charging stations will be rolled out, where car batteries can be utilised on site to reduce grid demand.

An energy saving measure for underground car parking areas is to install carbon monoxide detectors where ventilation systems are in use.  The detectors work to moderate the use of the ventilation fans based on CO2 levels.  Recently, a car park in Melbourne upgraded their system and reduced their energy usage by 92%.

Solar

The reduced cost of solar products and rising cost of electricity makes the business case for solar installation very appealing.  The residential space in Australia has already seem a significant uptake.  Many big businesses have signed power purchase agreements with large scale solar farms to offset their carbon footprint.  As well as generous federal incentives, there are now many installation and finance options available to further improve the business case for owners.  For example, low interest loans, rental agreements and power purchase agreements are all available.  Infrastructure can also be setup to monitor and bill tenants for their use of solar generated power.  Of course, the business case is also improving for investment in solar combined with battery technology to further remove dependency on the grid.

Conclusion

With uncertainty over grid supply, all of these solutions should be considered in parallel and delivered through a comprehensive implementation strategy.  Empower are an independent energy consultancy, who specialise in assisting Australian businesses to tailor an energy strategy that utilises buying power to keep costs low and make investment decisions that reduce risk and provide optimal returns.

Automotive Brands saved 80% of their office and warehouse lighting costs with a smart LED lighting upgrade.  You can too, and at no cost at all if installed by 31 March 2021 and your premises are in Victoria.

From 1 April 2021 the rebate for Victorian Energy Efficiency Certificates is dropping by 60%. These certificates are a Victorian Government incentive to support energy efficiency upgrades that reduce carbon emission. 

Although the value of the rebate is scheduled to reduce, the current price of a certificate has increased to a point that can fund a complete LED highbay upgrade and control unit including installation costs.

Even if you have upgraded your highbay lights to LED in the past, you can now upgrade to lower wattage dimmable smart LED highbays and control unit at no cost to you. 

Here are examples of the reduction in wattage that an LED upgrade can provide, along with the number of VEEC received:

200w to 150w = 8.37 VEEC (5.38 VEEC for Control unit)

200w to 120w = 9 VEEC (4.3 VEEC for Control unit)

200w to 80w = 10.04 VEEC (2.87 VEEC for Control unit)

150w to 120w = 6.1 VEEC (4.3 VEEC for Control unit)

150w to 80w = 7.05 VEEC (2.87 VEEC for Control unit)

120w to 80w = 5.26 VEEC (2.87 VEEC for Control unit)

This offer is only available for installations completed by 31^st March 2021, so get in touch with Empower straight away so that we can schedule your upgrade installation within this timeframe.

For further information see page 16 -  Part 34 – Non-J6 Building Based Lighting Upgrades 

Last week, the peak industry body, Energy Networks Australia, announced a COVID19 relief package for small business and residential consumers. 

There are two main points of the package that may be of interest to small business:

1. If you are a small business that is mothballed from 1 April to 30 June 2020 you may be eligible for a rebate of your network charges, which typically account for 30% to 50% of your electricity bill.  To be eligible you should: 
   •  be classified as a small energy user, where annual usage for the 2019 calendar year is less than 40 MWh for electricity or 400 GJ for gas. 
   • provide supporting evidence that energy usage is less than 25% of what it was historically during this period. 
2. In accordance with the Australian Energy Regulator (AER) statement, retailers cannot disconnect small business customers that are under financial stress through to 31 July 2020.

If you believe that you meet the criteria of a small business, where energy usage is significantly reduced through the April to June period, Empower will be happy to provide you with assistance in gathering and analysing the meter data required to support your rebate request which must be lodged by 1 September 2020.

Well over two million homes in Australia have invested in Solar PV, with generous feed-in incentives, the return on investment has clearly stacked up.

Australian businesses are now seeing Solar PV as a sensible investment because:

• Sky rocketing energy costs are unsustainable, volatile and the future is uncertain 
• There has been a plunge in solar manufacturing costs 
• There is a competitive solar finance market, with attractive options for both the building owner and the tenant. 
• Solar power is generated during daytime operating hours,which is high demand period for most businesses.

If you are interested in investigating whether solar can be financially viable for your business, click on the button below and provide us with a few details for a Free assessment: 

For many businesses, “demand” is an extra line on the electricity bill that adds thousands to annual spend.  Knowing more about how demand is calculated and when it is applied is critical to keeping your electricity charge as low as possible and preventing costs from blowing out.

Demand is the maximum amount of electricity, measured in either kW or kVA, required at your business premises at one time.  It reflects the capacity requirement that the distributor has on standby should your business need it.  Imagine that you are paying for the use of a large cup.  You may not need to fill the cup often, but you continue to pay for the use of the cup.  You could save a lot of money by simply switching to a small cup.

Demand is charged in different ways by different distributors.  Commonly, charges are set to make electricity more expensive during peak network periods, encouraging lower use during periods of network system stress.

Most distributors charge for the maximum demand value reached during the last months’ electricity use.  This is typically recorded during peak periods, Monday to Friday, excluding public holidays.  It is important to understand this chargeable demand period, so that you can change behavior; either using less electricity during these demand charge periods or shifting your use outside of these periods.

Ausgrid in New South Wales have a unique method for charging for demand.  Instead of looking at the last month, Ausgrid charge what’s called a 12-month rolling demand for the maximum demand value that is recorded between 2pm and 8pm on working days.  Yes, this maximum value is used as a basis for demand charges for a whole year.  

Empower recently worked with a bakery in Chatswood, NSW, where ovens are switched on every working day from 1:30am to 10:30am.  However, on one particular day in April, during Easter, the business was busy with orders so decided to run one oven for an additional hour in the afternoon to increase production.  This decision cost the business over $3,000 in additional demand charges over the next 12-months.  Now that the business owner is aware of this, next Easter he will run the oven before 2pm so that he does not incur this additional charge.

Feel free to contact us if you would like help unravelling demand charges on your bill.