Pick the low hanging fruit? How about the watermelons lying on the floor? — Partnering with Utilities to Reduce Energy Costs

When companies develop a sustainability strategy to reduce operating expenses, among the first areas they address is the “low hanging fruit” of energy efficiency as it represents one of the largest cost buckets behind rent or debt service.

However, many or most organizations may not think about “picking up the watermelons lying on the floor” by partnering with their utility company to create an energy plan. Because power providers are incented by federal regulators they are required to extend rebates and provide cost saving programs as part of their service to rate payers.

In a Member-Only meeting of the Sustainability Roundtable, Inc., New England-based National Grid was featured to share some information about programs they offer to their customers. They cite that partnering with a utility provider to develop a long-term strategic energy plan includes:

• New initiative to meet aggressive energy saving goals
• Targets top quartile customers
• Sets long-term and high energy saving goals (road-map) for customers rather than ‘short-term’ ad-hoc upgrades
• Create (or modify) an organizational shift to how energy efficiency decisions are made within a large organization
• A financial model that enables a re-investment based cash flow positive structure for energy efficiency upgrades

Their presentation highlighted that, in addition to ‘triple bottom line’ energy planning, there are several other key areas they recommend organizations to address:

Financial – incentives, on-bill financing, investment criteria

Technical – benchmarking, energy use data, coordination with LEED standards

Operational – staff training, building certification, O&M guidelines

Other “green” measures – indoor air quality, day lighting, water savings, GHG tracking, productivity studies

The presenter during the program was National Grid’s Michael McAteer who said, “a significant opportunity exists for customers to maximize the technical expertise and achievable energy savings potential in their business environments by partnering with their utility. Adopting a comprehensive data driven approach to reduce operating costs with support from utilities is a smart move and provides valuable dividends to customers.”

McAteer suggested a process that you and your utility company could take might include:

• Establish contact with top management of large customers and the utility company
• Identify energy goals, financial criteria, and sign memo of understanding
• Identify/prioritize projects
• Benchmark existing use
• Implement measures and incentive payments
• Evaluate progress
• Develop long-term road map for the entire portfolio through “collaborative effort”
• Train operations staff, create case studies, and assist other studies (water savings, productivity, LEED etc.)

The key takeaways the SR Inc. program highlighted were:

• Leading companies that develop and implement portfolio-wide sustainability strategies prioritize scalable best practices in energy efficiency and energy cost reduction, and seek to maximize innovative financing, including utility benefits.
• Utilities are responding to market demand for a portfolio approach by looking beyond buildings, building systems, and technologies for opportunities to assist customers to reduce demand and consumption.
• The portfolio-wide approach enables customers and utilities to partner at a strategic level, and achieve greater reduction and savings a lower cost and in less time than a fragmented ‘Energy Conservation Measure’ or technology rebate approach.

As you embark on the green to gold treasure hunt or search for the proverbial ‘low hanging fruit’, be sure to reach out to your energy provider who is ready to help and can play an important role to address energy cost, save money and pick up some ‘watermelons.’

If you would like to receive a copy of National Grid’s presentation or to learn more about how you might forge a strategic partnership with your utility company, please contact me at larrysimpson@sustainround.com.