Energy efficiency projects like upgrading to LED lighting, is hard for businesses to push up their “to do” list when there are dozens of competing priorities: sales to make, customers to meet, and suppliers to chase.
It is especially difficult for small and medium-sized companies, where very often no single individual has specific responsibility for energy management.
But upgrading an inefficient lighting system to LED does make good business sense. In fact, it is very often one of the most cost-effective investments a company can make into reducing unnecessary overheads.
Many businesses we approach regarding an LED lighting upgrade are concerned by the amount they spend on their energy bills, on maintenance, loss of productivity and want to do more to improve the energy efficiency of their business.
But despite recognizing the issue and wanting to change, many businesses resist energy efficiency by not taking enough action. So why isn’t everyone doing it?
The most common feedback we hear from businesses regarding barriers to making improvements is a lack of money to invest in new energy saving equipment.
Of course, low-hanging fruit may not always be enough.
Often businesses don’t own their buildings, which leads to a split-incentive problem. Landlords are responsible for capital improvements, while tenants are responsible for operating expenses.
On the balance sheet, energy inefficiencies are often seen as an external costs outside of the core business model, which can push projects to the sidelines.
The result? Projects with payback periods under three years and payback dividends for decades from energy and maintenance savings or projects that are cash-flow positive from day one don’t get done, the energy upgrade decision process seems to be similar to peace talks, where everyone is talking past each other and little changes.
The UC Davis’s Energy Efficiency Center, points out that energy research today is shifting away from focusing on technology, finance and individual behaviour to examining social change.
They believe, buildings are social systems. Economic incentives like rebates, while helpful, don’t touch on some of the deeper issues at play.
For one thing, building operators, who manage facilities on a daily basis, typically don’t see electricity bills.
Some facility managers believe that upgrades may increase the likelihood of occupant complaints, which may be tied to their job performance.
In addition, the study found that occupants overall are dissatisfied with building temperature, lighting, air quality and acoustics.
We need to identify ways in which we can reward people for not only making people more comfortable and happier, but also for saving energy.
Finding a way to make energy saving initiatives a team effort and rewarding those who contribute to the program can help build a positive conservation culture.
Creating small wins and building on those successes will help ensure energy savings are long lasting.
Energy is an important part of operations management that needs a comprehensive plan and attention to succeed in achieving savings and efficiency.
Prioritizing energy efficiency in operations, facilities and energy managers can gain greater leadership and improve their leverage for budget needs in other areas of their departments.