Rising energy costs are now so worrying that according to research by Energy Works 98% of those in the UK industrial sector, including warehousing, will not meet their growth targets, while 8% are now considering staff cuts to save money. Just as concerning is that 88% of UK businesses are worried about the security of their energy supply. This follows recent warnings by OFGEM that the UK generating capacity is nearly at full stretch. Given the planned closure of some coal and nuclear power stations, OFGEM is warning that spare capacity could fall from today's 14% level to just 4% in three years, with a risk of 'brown outs' and 'black outs' starting in the winter of 2015-2016. The threat of energy inflation to UK competitiveness is another big worry seen by 90% of UK businesses.
The paradox is that the means are available to cut the energy bill sharply through modest and often financially incentivized investment and while 51% are aware of energy-efficient LEDs, for example, 87% have yet to make the transition. This is all the more curious because, as the research shows, 72% of industrial firms were loath to install clean technology because they believed the initial outlay was too costly and that lighting suppliers were viewed with suspicion when it came to their claims on energy savings, according to findings by the Britain's Carbon Trust.* The facts, however, belie these sentiments, so what are the facts on warehouse energy-saving investments?
Before looking at energy-saving means, however, a look at how big the cost is should concentrate minds to consider action now, rather than, as in Britain, wait until the Energy Act, 2011, enforces warehouses by 2018 to comply or risk closure because their energy proficiency certificates are at or below F or G ratings.
According to US power outfit, Madison Gas and Electric, energy costs can account for as much as 15% of a warehouse's operating budget. A report by Touchstone Energy estimates this can reach as high as 10% of total revenue. In cold stores the energy bill is typically between 25% and 30%. These estimates, of course, will vary from country to country because energy costs vary widely and not all users will need lots of heating throughout the year.
LED lights show the way
If there is one area of warehouse energy costs that almost invariably causes greatest concern it is lighting, which typically accounts for 70% of total energy consumption. For many years lighting devices like dimmers and sensors activated by personnel movement and daylight changes have helped cut costs but now advances in lighting technology, particularly LEDs, are not only drastically cutting energy costs but also maintenance and repairs, as well as improving light quality and cutting accidents. Poorly distributed light and excessive glare from certain lamps can affect 60-year old forklift drivers far more than 20-year olds because they need six times as much light to discern objects clearly.
So what kind of returns on lighting investment can be expected and what investment incentives are available? A programme of site energy surveys commissioned by the Carbon Trust confirmed that quick returns on no and low-cost actions can often provide cost savings of 10% to 20% with a further 10% to 55% per year savings achievable with simple payback periods ranging from one to six years. This could translate to an annual saving of over £200 million for Britain's warehouse sector. To ease the pain of investment in energy- saving lights, the Carbon Trust offers zero per cent interest loans of up to £100,000 for up to four years and will conduct free site surveys to highlight where savings can be made. Other UK government incentives include the Enhanced Capital Allowances which enable businesses to buy energy-efficient equipment using a 100% rate of tax allowance in the year of purchase, provided the equipment is on the Energy Technology list.
There is, however, an alternative that does not involve any cash investment in LEDs. Energy Works, for example, says any industrial firm can take advantage of their free LED retrofit in return for a percentage of the energy savings made over a typical period of five years.
Given the importance of lighting to warehouse energy costs, any stores lit by 250W or 400W SON or metal halide lighting should be considered for a change, and most warehouses appear to use this form of lighting. If such fittings are replaced with fluorescent T5 luminaires they will not only give a better light output and consume less energy they are also amenable to automated controls, such as PIR motion detectors or daylight controls, without any re-strike concerns. If installed with automated controls, T5 consumption costs could reduce SON energy costs, based on 10 hours a day, five days a week, from £1,120 worth of electricity per year to just £220.
The moral imperative
In ambient warehouses the second highest energy cost after lighting is space heating and the worst place for heat loss is usually the loading bay. This is so because frequent traffic movements by lorries and forklifts encourage an open door policy in all weathers. A simple solution that has been available for several decades is the rapid roll PVC door, to which have recently been added insulated slatted versions moving at up to 3 mt/sec and secure enough as an external security door. Another heat loss area is the loading dock where the air gap between docked lorry and open door is excessive. Inflatable dock shelters would solve that problem. Most leading loading bay equipment suppliers will offer a free energy audit when quoting for equipment, which in many cases would show a door payback period of a year or less.
Quite apart from improving warehouse profitability through energy reduction programmes there is another, incalculable benefit for all mankind. Britain's warehouse sector is responsible for about 10.2 million tonnes of CO2, or 3% of total UK emissions. Research shows that the sector could potentially achieve a 16% cut in emissions mostly form lighting and heating. All around the world asthma rates are soaring among non-smokers and air pollution is top of the list of usual suspects. Where there is no suspicion, however, is that air pollution is now a leading cause of lung cancer. London's air quality is often much poorer than EU-set safety limits while in China at least 500,00 people die prematurely from air pollution every year. In northern Europe alone an estimated 50,000 a year die from cargo ships' sulphur emissions. There is, therefore, a moral imperative for all to be more energy conscious.
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