The increasing cost of energy is a hot topic across all business sectors at present, but it is of particular interest to the biggest consumers, namely the manufacturing and mining sectors.
A recent report by ClimateWorks Australia to assess companies’ energy performance, found that many industrial and manufacturing companies typically spent in excess of 15% of their operating expenditure on energy. A third of companies analysed could increase profits by around 5% p.a if they matched the performance of leaders in their sectors. Under-performers in the sector have more to gain, with between 2-10% profit growth p.a. post implementation of energy reduction initiatives.
Improving your company’s energy usage and spend is not only measurable but profitable and will deliver significant savings in energy costs. Often initial savings can be achieved with minimal to no capital investment. Simple measures such as bench-marking your company against the best in the sector or renegotiating your current energy supply contract can kick start the program.
The next steps in the process can be more capital and resource intensive but are still very much worth the investment. In food manufacturing for example, the production of steam, hot water and refrigeration are major energy consumers. The age of a site and the effectiveness of it’s equipment can have a huge impact on the energy consumption of that plant. Recycling of heat created on-site, use of biogas from waste streams, or using roof space for renewable energy are just a few ways to drive more efficient energy use on site.
A company’s energy use can have a major impact on the bottom line and if unchecked significantly reduce the ability to service customers at a cost-effective price. Reducing your energy costs and consumption is simply good for business!
Contact Rowe Advisory today for a no obligation confidential discussion about building an Energy Strategy in your business. Our team of industry experienced consultants are here to help.