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Why you need to balance your energy sources

Businesses need to unlock competitive advantage, improve resilience, and get the most from their energy. Find out how balancing energy sources can help them to achieve each of their objectives.

Balancing energy sources can help businesses to achieve strategic goals, as well as generate cost efficiencies and other benefits.

Businesses now have more choice when it comes to energy sources. Being able to balance multiple energy sources allows businesses to achieve cost efficiency, resilience and flexibility. Investment in alternative energy sources enables a more flexible approach, balancing use and supply from various sources — in this way energy evolves from being a cost centre into a strategic asset.

Unlock greater value from your current situation

After ensuring your existing energy contracts represent value for money, more can be done to derive value when energy-consuming assets are digitally connected and able to measure and monitor energy usage in real time.

By analysing the data gathered, this digitisation enables a company to quantify efficiencies which can be gained. Reassuringly, given its importance, two-fifths of organisations surveyed for The Energy Advantage Report from Centrica Business Solutions say they’ve already adopted wireless sensors and analytics, and/or BMS/BAS across at least some of their sites. Another fifth say they’re trialling or planning to adopt these solutions.

Considerable savings can be made from understanding how, where, and to what extent energy is being used. By using sensors, Fujifilm uncovered two major areas for savings around equipment running when production had stopped. By using data to make two small changes, the business has saved £26k per annum.

Move on to quick wins

Before considering alternative energy generation and supply solutions your first step is to minimise consumption by becoming more efficient. Many organisations start by introducing measures that will help deliver energy efficiency improvements to their buildings. Just over half of businesses surveyed state they have already invested in this area. Improvements include LED lighting, HVAC and operational optimisation — representing some of the most straightforward solutions, offering the clearest, and quickest ROI.

By swapping to LED lights and investing in movement sensors and remote-control technology, one NHS hospital made £180k savings per annum across two phases.

Balance energy sources

Many businesses are using local energy generation solutions such as on-site Combined Heat and Power (CHP) generation and renewable technologies. These alternative sources can be used to balance each other and the grid — giving the business more control over what energy source is being used and when. The use of batteries further enhances this flexibility.

Among energy leaders, almost a third have already invested in renewables and nearly two fifths in CHP. The business case for CHP can be extremely compelling. The commercial opportunity is strongest for those organisations with high thermal loads (such as hot water, steam, chilled water or hot air) and where electricity costs are high. Places Leisure saves £250,000 a year, and reduces carbon emissions by over 2,600 tonnes by using CHP.

On-site renewables are an area where collaboration between companies can help. Almost three-quarters of businesses believe there are considerable opportunities to share energy infrastructure and generation assets with nearby companies. The most positive about this opportunity are organisations in the US, and companies in the retail and wholesale sectors.

We expect much wider adoption as these technologies and battery storage continue to mature.

Monetise energy opportunities

Once a company is able to balance its energy sources effectively, it can begin to evaluate energy monetisation opportunities  — including Demand Side Response (DSR) and the use of batteries. This provides a revenue stream that can be reinvested in further energy flexibility or other areas of the business  — increasing the value of energy as part of a company’s strategic operations.

Nearly all of those surveyed were aware that they could get paid for selling power to the grid at times of peak demand. And over a third (35%) of companies we surveyed have invested in distributed energy solutions that have led to monetisation opportunities.

By utilising Demand Side response, ArcelorMittal was able to return 150kW of energy to the transmission grid during peak periods.

Work with a trusted provider

While many organisations recognise the advantages of energy improvements, there is often a gap between ambition and reality. Many are unsure where or how to invest. In fact, three-quarters of businesses we surveyed felt they lacked both the commercial and technical expertise needed to realise new opportunities.

Centrica Business Solutions can help by providing advice and a variety of possible technical solutions and innovative financing options including “as a Service”. 

Theme Park chooses “as a Service” model

By opting for on-site CHP installed and run by Centrica Business Solutions, a large theme park was able to provide cheaper and cleaner power and heat for its waterpark.

The solution ensured it met both energy and carbon reduction targets, while also achieving cost savings of 12% a year — and as the unit generates power at source, there is very little transmission loss. Leasing and “as a Service” arrangements are funded out of ongoing energy savings or increased revenue, reducing the capex burden on the company.

Currently being used by one in ten businesses (compared with two-fifths of companies self  funding and a third having used government schemes) leasing and “as a Service” is  almost twice as likely to be a preferred option among the most advanced companies in our Energy Leadership Model. We anticipate that funding energy investments through opex will become increasingly popular.

Choose the option that’s right for your business

There is no right or wrong way to balance your energy sources — the best performing companies do so in a variety of ways. These include using grid supply when it’s economic to do so, continuously improving their energy efficiency, deploying local generation technologies including CHP and renewables and taking advantage of opportunities for monetisation. By digitising and optimising usage, employing distributed energy solutions and with support from experienced providers like Centrica Business Solutions, energy can make a material contribution to advancing your business objectives.

Discover further reasons to balance your energy sources.

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