Many businesses are turning to energy audits to help stem rising energy costs. In addition, energy audits are great for tracking down waste and identifying opportunities for improvements.
But, not all opportunities are created equal. Here’s where energy audits shine. They can rank which cost savings investments provide the best returns.
Four factors can significantly impact the potential payback of energy savings investments. Understanding these factors can help you make the most of an energy audit:
- Energy prices. How much you pay for each kilowatt hour of electricity or each unit of natural gas can change over time. The higher the price you pay, the more you will save by implementing your audit recommendations.
- Carbon prices. Canada has a price on CO2 emissions. That price is going up regularly. The more you reduce carbon emissions from your operations, the greater will be the potential return on your investment.
- Facility operations. How you operate your business may change over time. Setting your mind on reducing waste at every opportunity will always be a good business practice.
- Government and utility incentives. Grants and rebates may be available to reduce the amount of investment you need to make. Make sure you act before those incentives expire.
Energy audits are great at identifying potential opportunities. However, keep paying close attention as time goes on. Cost and payback assumptions change over time.
10 years ago, natural gas prices began a steady decline. Fracking technology opened up access to significant new supplies, driving down prices. At the same time, in many places, electricity commodity costs climbed. As a result, energy audits often recommend powering equipment, where feasible, with natural gas instead of electricity.
Flash forward 10 years to now. Natural gas prices are on a tear. Expect energy audits to more likely recommend measures that move away from natural gas as the price of carbon increases. Non-carbon emitting fuels will gain more favourable payback periods.
Dust off the energy audits sitting on your shelf. The measures they recommended will likely still have value. Check out cost and payback assumptions against current commodity costs. Estimates that didn’t pass your investment hurdle rates when the audits were written may now be feasible.
Keep your eye on energy commodity costs and carbon prices. Assess your operations for optimum efficiency. Check out incentive programs. Energy audits can help you wrestle back control over rising cost in today’s world.
If saving money on energy appeals to you, 360 Energy can help. Contact us if you want to make the most of your energy audits.