Reducing consumption is the only sustainable way to reduce bills in the long run according to Bord Gáis Energy Head of Retail Mark Prentice. BARRY McCALL reports.
Mark Prentice finds himself in an unusual position. He is head of retail for a major energy supplier to business and consumer markets yet is actively engaged in helping customers buy less of his product. That is the reality for modern energy companies. The global imperative to cut down on greenhouse gas emissions, reduce fossil fuel consumption, and achieve ongoing energy cost reductions has seen the energy supply sector morph into an energy solutions business.
“What businesses are looking at right now is how to reduce their carbon footprint and their environmental impact”, he says. “This is part of the overall corporate social responsibility for large business but we are seeing it with small business as well. They are interested in controlling and reducing energy consumption and cost over longer term.”
He points out that with corporate annual reports increasingly including separate environmental impact and sustainability sections it will become less and less acceptable for companies to use high carbon energy sources like heavy fuel oil (HFO).
“Their CSR mission now includes their carbon footprint and large multinationals are now looking for constant reductions in energy usage”, he adds. “They have to be able to say to their shareholders and customers how much energy they saved in the previous year and by how much the reduced their carbon footprint.”
“What businesse sare looking at right now is how to reduce their carbon footprint and their environmental impact”
They are also looking for cost reductions, of course, and again energy efficiency is key. “Energy is such a global industry whether you’re talking about oil, gas, or coal”, Prentice explains. “There is not an awful lot that energy companies can do for the end price of the product. That’s why efficiency is so important to us. Reducing consumption is the only sustainable way to reduce bills in the long run.”
In this sense it is not so much a question of what energy source being used but how much is being used and what the carbon footprint is. “It’s not gas versus oil or whether it’s fossil fuel or not, it’s how much energy is being saved and by how much the carbon footprint has been reduced.”
Of course, it helps that gas is an inherently more efficient and therefore lower carbon fuel than oil or coal. “Converting from oil to natural gas reduces a carbon footprint and when a customer is already using gas it might be just about using less”, he notes. “My background was in firmus energy, previously BGE’s Northern Ireland business. I spent a lot of time there talking to businesses who were transitioning to natural gas. Gas is a transition fuel as we move to a lower carbon economy. Customers who transition to gas from oil reduce emissions by 20 to 30 per cent. When they move from coal the reduction is 50 per cent.
Gas burns cleaner and more efficiently as a fuel. There are other efficiencies as well. Oil boilers build up a lot of soot and need ongoing maintenance. Natural gas burns cleanly making for much lower maintenance costs. It is also cheaper than oil. For most businesses it delivers a 25 to 30 per cent saving on fuel bills.”
But that’s just the start of the story. “More and more we are talking to customers about how to use gas innovatively”, he explains. “Electricity generation is one example.
One of our customers, Bausch & Lomb in Waterford, has developed a 3.3MW combined heat and power plant (CHP) part-funded by BGE which will deliver savings of €1 million on annual energy bills. They are generating 90 per cent of their thermal needs and 70 per cent of their electricity needs on site. We are seeing more and more companies looking at the CHP option. It protects them against price spikes while meeting their own energy needs.”
The BGE Energy Efficiency Grant Funding Scheme supports companies who wish to implement innovative energy solutions. “We help companies of all sizes save money. We can provide a financial contribution towards the capital cost of an energy efficiency project. For every kWh a customer saves, we will provide an additional financial contribution towards the project. So the more the customer saves the more they get back from BGE.”
A particular initiative in this space is the company’s partnership with UrbanVolt, an award winning Irish company that retrofits commercial buildings with highly energy efficient investment grade LED light fixtures. “We are constantly seeking ways to help our customers reduce overall energy consumption. We have formed a partnership with UrbanVolt to assist customers install LED lighting. Moving from fluorescent lighting to LED can generate savings of up to 75 per cent on lighting costs.”
Moving from fluorescent lighting to LED can generate savings of up to 75% on lighting costs
The unique facet of the partnership is that it enables businesses to dramatically reduce electricity costs without having to make any up-front investment through their ‘Light as a Service’ delivery model. UrbanVolt installs the lights at no up-front capital cost to the customer and maintains them for five years, with the costs being paid for by the savings made on electricity bills during the period.
“Under the partnership UrbanVolt replaces the bulbs generating up to 75 per cent in savings”, says Prentice. “The company keeps around 40 per cent of the savings and the balance is used to pay for the upfront cost and the maintenance of the LED lighting over the five years of the agreement. After this five years, the company keeps all of the savings. This means that the project isn’t competing for scarce capital in a business and the customer realises immediate savings on lighting costs. It’s proving to be a really interesting model. Point solutions like that are very attractive. We are able to present customers with something that will reduce energy costs forever. From our point of view it also helps us develop longer term relationships with the customer for the future.”
Being part of the international Centrica group also helps. Fellow Centrica subsidiary Panoramic Power offers a unique wireless sensor technology to customers which allows them to cheaply and easily monitor energy usage. “The wireless sensors are clamped on to the electrical circuits of energy consuming equipment throughout a customer’s building and monitors the electricity consumption in real time”, Prentice explains. “The information is sent wirelessly back to an analytics platform allowing the customer to see exactly what electricity they are using and where.
They can tell if parts of a building are using more than necessary or they can see if a device is about to fail by monitoring current levels which helps with preventative maintenance”.
Having full visibility on electrical usage helps to optimise energy management. When employed across a wider area it can also provide other interesting operational insights. “A retailer can see when a store has closed early”, Prentice notes.
We are constantly seeking ways to help our customers reduce overall energy consumption
(Image of “Big Results from Tiny Boxes” with Caption:Panoramic Power’s wireless sensor technology)
The beauty of the system is its low cost and simplicity. No maintenance is ever required on the self-powered sensors and hundreds of them can be installed in a few hours. “We are just launching this into Ireland”, he adds. “More and more operations directors in the US are adopting this technology. It will be quite interesting to see how this goes.” He says that the ultimate goal is to help customers save money at the same time as improving environmental performance. “If we can save a customer money on light and heat that gives them a pot of cash to spend on a mix of energy efficiencies or elsewhere in the business”, he says. “We are growing customer numbers all the time and we are growing our market share. But our customers are telling us that it is not just about price. We can give a percentage off the price this year but we would much rather give them 15 percent off their usage forever.” D