03 Aug 2018
Small business around Australia are battling with the spectre of rising energy costs. According to the Australian Energy Market Commission (AEMC) it’s an issue which will continue to grow as the complexity of the market increases.
Recent data from Energy Consumers Australia showed small business electricity bills rose 22 per cent year-on-year in South Australia and the ACT in April and 15 per cent in NSW.
"We're doing more with less power, for sure.” - Bertazzo
Many are being forced to act to improve their efficiency – and some are seizing the opportunity to reduce their environment impact, too.
For Wodonga-based Raymond and Trudie Bertazzo, operators of the family owned Bertazzo Engineered, an energy audit culminated in the purchase of new equipment – which has not only saved on their energy usage but been a boon for their business.
“What that project gave us was the opportunity to have a good look at ourselves and where that energy was being consumed within the factory,” Raymond told bluenotes.
“We did a major clean-up of all our switchboards, all our wiring, where the peak demand was the timings of it and anything else. [We’ve upgraded] the equipment, we've upgraded where it came from as well.”
“That was part of a 36 per cent saving with 30 per cent more contract hours. We're doing more with less power, for sure. “
According to the Australian government, energy use contributes about 78 per cent of Australia’s greenhouse gas emissions. The good news is that investing in energy efficiency is one of the most direct and cost-effective ways for businesses to improve their energy profile.
The same story
Luke Menzel, CEO at the Energy Efficiency Council says many SMEs – particularly manufacturers like the Bertazzos – find bringing down their energy usage is having additional benefits in terms of resource and process efficiency – “because they're all part of the same story”.
“Energy efficiency is one of the no-brainer measures that has a business benefit as well as an environmental benefit,” he told bluenotes.
Ben McIntyre, a Commercial & Agribusiness Manager at ANZ, says electricity costs, behind labour, are one of the major expenses for any business located in a regional area like the Bertazzos.
“Any way they could minimise or reduce those was obviously key focus for them,” he says.
In September 2017, an Australian Competition and Consumer Commission report showed the doubling of wholesale power prices has seen significant increases in the prices offered to commercial and industrial users around Australia.
According to Trudie Bertazzo, Bertazzo Engineered owns machines which operate 24 hours a day, 365 days a year. Before the audit, lacking the capacity to do more work, the company couldn't increase turnover. The owners knew they had to act.
“We could’ve just replaced what we had and be energy efficient,” she told bluenotes. “But we weren't going to really achieve anything.
“We needed to get the two machines. Obviously our consumption of energy would go up so we needed to be more-efficient in the way we did it.”
Raymond Bertazzo said in the three years leading up to the audit the group’s productivity had grown but that had been outstripped by the surge In power costs.
“The reality is… we have welders running all day and lights running all day. The equipment was where we had to find the solution.”
The 2018 International Energy Efficiency Scorecard report in June showed Australia is at the back of the pack when it comes to the energy efficiency story.
Menzel says the position has a lot to do with the fact energy has traditionally been pretty cheap in Australia.
“If you're a business looking at investing scarce time and resources, it's made sense to invest in other areas,” he says.
Earlier in 2018, ANZ and the Clean Energy Finance Corporation launched a $A150 million program to help businesses cut energy costs.
The ANZ Energy Efficient Asset Finance program aims to help businesses reduce carbon emissions through innovation, helping them invest in energy-efficient and renewable technologies which will help reduce their energy use, carbon foot print and fuel costs.
A regular at the international equipment fairs, Raymond Bertazzo says the company committed to new, energy efficient machines - which have since paid off in productivity gains.
“We had the opportunity to expand our business and we took that opportunity to go for the more energy efficient equipment,” he says.
Menzel says with that move the Bertazzos joined leading businesses around the country “transforming the way that they deal with energy”.
“They're making really smart investments, whether it's in renewables or energy efficiency,” he says. “I see that as an incredibly positive thing because these leaders are showing the way.”
“They're trailblazing towards a more-efficient, more-productive and lower-carbon economy.”
Cosi De Angelis is GM Transaction Banking & Asset Finance Solutions at ANZ
The views and opinions expressed in this communication are those of the author and may not necessarily state or reflect those of ANZ.
03 Aug 2018
02 May 2018