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Electricity costs have soared in the last decade and small to medium businesses have been caught between rising bills and keeping prices competitive for customers.
According to the latest ABS inflation statistics, the cost of electricity and gas were the fastest rising household expenses for Australians in the last decade. Comparing the difference between the June 2018 quarter against June 2008, national retail rates have surged by over 117%.
Day to day operations for retail businesses, cafes and restaurants can result in unnecessary bill shock for business owners if not kept in check. Here’s 5 tips for keeping a lid on energy costs for retail businesses this summer.
1. Run air-conditioning at 25°C or above
The science is in, and you’re mostly running your air conditioning colder than necessary. According to a recent study in the journal of Building and Environment, typical commercial lease agreements in Australia stipulate 22.5°C in summer as an acceptable thermal temperature. However, an experiment testing participant’s comfort levels at 25°C resulted in no noticeable difference.
Based on analysis from Ergon Energy, each degree cooler in summer adds around 10% to the amount of electricity a typical air conditioner unit uses.
This can add up quickly over time for retail businesses operating long trading hours with constant indoor cooling.
2. Check your refrigeration settings and efficiency
Does your business run commercial or industrial refrigeration? Whether you have a walk-in cool room, refrigerated display cabinet or simple domestic fridge for your business, your refrigerated appliances could be the source of significant potential efficiency and usage savings.
For example, old and soft door seals are a major source of wastage that is easy and inexpensive to replace. Cold air will leak from loose or broken seals, triggering your fridge’s motor to run more often and use unnecessary power.
Another easy savings measure involves simply checking your refrigeration thermostat setting that it is not unnecessarily too cold. Just like raising the temperature on your air-conditioning, running your fridge temperature just 1-2 degrees warmer can yield significant savings.
3. Automate power conservation with timers and sensors
Timers and sensor switches hooked up to your commercial appliances, cooling and store’s lighting can help you automate power conservation by ensuring power is not consumed when not needed. For example, lighting can be activated only when a room is being used, or cooling set to automatically turn on and off just before and after your store’s trading hours.
4. Switch your lighting to LED bulbs
LED lighting is much more energy efficient than incandescent, halogen and compact fluorescent (CFL) bulbs.
While each bulb is more expensive, they will also last 25 times longer than incandescent lights and use 75% less energy for an equivalent lumen level, according to the Department of Energy.
The up-front cost of LEDs generally has a payback time of less than 1 year.
5. Shop around for better rates
Finally, small and medium sized businesses in New South Wales, Victoria, South East Queensland, the ACT and South Australia can to choose their own energy retailer and shop around for better rates.
According to business energy broker Make it Cheaper Australia, at least 4 in 5 businesses are overpaying on electricity bills by not shopping around and could save on average over $1,100 each year by switching to a more competitive offer (based on comparing customer’s actual rates versus what they would pay after switching to a recommended offer from Make it Cheaper’s panel of energy retailers).
“The opinions expressed by BizWitty Contributors are their own, not those of BizCover and should not be relied upon in place of appropriate professional advice. Please read our full disclaimer."
