Cutting energy use in business premises: finding where it goes and fixing the right things first

For most small businesses, energy arrives as a bill: a total for the quarter, a few charges and a figure that seems to rise each year. The bill says how much was used, but not where, when or why. Without that, the usual responses are guesswork. Someone suggests solar panels, someone else blames the air conditioning, and a reminder to switch off lights goes up in the lunchroom.

Energy use in a workshop, warehouse, factory or office follows a few physical principles, and most of the waste is found in predictable places: equipment running when nobody needs it, heat getting into spaces that are then cooled, compressed air leaking away, fans and pumps running at full speed when they do not need to, and lighting designed for another era. Many of the best savings cost very little, and they should come before larger investments, because they also change the size of any equipment you later buy.

This article explains how to find out where energy goes, the main areas where premises waste it, the order in which to tackle improvements, and how to prove the savings are real. It is general information. Electrical, refrigeration and air-conditioning work must be done by appropriately licensed trades, and structural or network questions, such as adding solar panels, need the relevant professionals and approvals.

Start with how you are charged

Business electricity bills typically combine several kinds of charge:

A kilowatt (kW) is a rate of using power; a kilowatt-hour (kWh) is the energy used by one kilowatt running for one hour. A 3 kW heater running for four hours uses 12 kWh. Knowing which charges dominate your bill tells you whether to focus on total energy, peak demand or timing. Your retailer can explain your tariff, and an energy broker or adviser can compare alternatives.

Get the interval data

Most business premises now have meters that record use in short intervals, often every 15 or 30 minutes. Your retailer or distributor can usually supply a year of this data. Plotted as a daily profile, it shows things a bill never can:

• Base load: the power drawn when the business is closed, at night and on weekends. Some base load is legitimate, such as refrigeration, servers and security systems. Much of it is often waste.
• Start-up peaks: when everything switches on at once in the morning.
• Operating load: how use during working hours compares with output or activity.
• Seasonal patterns: how much heating and cooling add in winter and summer.

The base load is usually the first place to look, because it runs for most of the hours in a year. A business open 60 hours a week is closed for 108, so a kilowatt of unnecessary overnight load runs for over 5,600 hours a year.

Walk the site after hours

Once the data shows a significant base load, walk the premises at night or on a weekend and look and listen. Common findings include air compressors running to feed leaks, air conditioners on timers that were never set, lights in storage areas left on, extraction fans running, hot water urns and boilers keeping water hot for nobody, chargers and equipment on standby, and outdoor lights burning during the day because a sensor failed. Temporary clamp meters or circuit monitors, installed by an electrician, can show which circuits make up the remainder.

Cooling and heating: reduce the load before buying equipment

Air conditioning is often the largest single use of energy in offices and many workshops. The amount of cooling a space needs depends on how much heat enters it, and that heat comes from a few sources:

• The sun through windows, particularly east and west-facing glass in summer.
• The roof, especially dark metal roofs with little insulation.
• People, equipment and lighting inside the space.
• Outside air, through ventilation and leaks.

Reducing these loads is usually cheaper than buying more cooling. External shading stops sunlight before it reaches the glass and works better than internal blinds, which let heat into the room before blocking light. Roof insulation and lighter-coloured roofing reduce heat through the ceiling. Efficient lighting and equipment produce less heat. Sealing gaps around doors, penetrations and loading docks reduces uncontrolled air flow.

Thermal comfort depends on more than air temperature. The main factors are air temperature, the temperature of surrounding surfaces, humidity, air movement, clothing and how active people are. Ceiling or pedestal fans make people feel cooler at the same air temperature, which can allow a higher cooling set point. Setting cooling and heating set points sensibly, and preventing heating and cooling systems from fighting each other in the same space, often saves energy without anyone noticing a difference.

Moisture and condensation

Air holds water vapour, and warm air can hold more than cold air. The dew point is the temperature at which air becomes saturated and water condenses out. Relative humidity describes how close the air is to saturation at its current temperature. When warm, moist air meets a surface colder than its dew point, water forms on that surface.

This explains several common premises problems:

• Roof sweating in warehouses and sheds, where metal roof sheeting cools on a clear night below the dew point of the air beneath it, and water drips onto stock in the morning.
• Condensation in cooled rooms, where moist air leaks in from a loading dock or outdoors and meets cold surfaces.
• Frost on coolroom evaporators, where moist air entering through open doors freezes on the coil, reducing performance and requiring more defrost cycles.
• Mould behind linings, where moisture collects in cold wall or ceiling cavities.

Removing moisture from air costs energy, because the air must be cooled below its dew point and the water carried away. Keeping moist air out, by sealing, using strip curtains or air locks and controlling ventilation, is usually cheaper than removing it later. Persistent condensation problems are worth investigating with an HVAC engineer, because the cause is not always obvious.

Refrigeration and coolrooms

For businesses that store food, flowers, pharmaceuticals or other temperature-sensitive goods, refrigeration often runs around the clock and dominates the base load. Simple measures make a large difference:

• Keep doors closed and fit closers, alarms or strip curtains, since each opening admits warm, moist air.
• Keep condenser coils clean and out of direct sun, with free air flow around them.
• Check door seals for gaps.
• Set temperatures to what the product needs, not colder.
• Have systems serviced by licensed refrigeration technicians, including checks on refrigerant charge and controls.

Motors, fans and pumps

Electric motors drive fans, pumps, conveyors, compressors and machinery, and in many industrial sites they use most of the electricity. Two principles matter.

First, switch them off when not needed. A ventilation fan or a recirculating pump running through the night does nothing useful.

Second, for fans and centrifugal pumps, power falls steeply with speed. The affinity laws describe the ideal relationship: flow is proportional to speed, pressure to the square of speed, and power to the cube of speed. In theory, running a fan at 80% speed needs about half the power, because 0.8 × 0.8 × 0.8 = 0.51. Real systems save less than the theory suggests, especially pumps working against a fixed lift, but the effect is still large. Where a fan or pump’s output is currently controlled by throttling with a damper or valve, a variable speed drive, which adjusts the motor’s speed electronically, is often a good investment.

When a motor fails, consider replacing it with a more efficient one rather than rewinding it, and match its size to the real load.

Compressed air

Compressed air is one of the most expensive forms of energy in a workshop, because a compressor converts only a small share of its electrical input into useful work at the tool; most becomes heat. Leaks, unnecessary pressure and using air for jobs it is poorly suited to all waste it.

A simple leak test: at a time when no equipment is using air, run the compressor and time how long it spends loaded, actually compressing, compared with unloaded or off. If it runs loaded 30% of the time with no demand, leaks are using roughly 30% of the compressor’s capacity, continuously. Find leaks by listening when the site is quiet, or with an ultrasonic leak detector, fix them, and repeat the test periodically. Also check whether the system pressure is higher than any tool needs, and turn the compressor off, with an isolating valve closed, outside working hours.

Lighting

Modern LED lighting typically uses much less energy than older fluorescent, halogen and metal halide fittings for the same light, lasts longer and produces less heat. Controls add further savings: occupancy sensors in storage areas, aisles and amenities, daylight sensors near windows and skylights, and timers on outdoor lighting. Before replacing fittings, check the light levels the work actually needs, since some areas are over-lit and others under-lit.

Hot water

Water heating is a steady load in businesses with kitchens, wash-down areas or amenities. Check that storage temperatures are set correctly, including the minimums required to control bacteria, insulate hot water pipes, fit timers to urns and boilers, and consider heat pump water heaters when existing units reach the end of their life. Plumbing work must be done by licensed plumbers.

The order of action

A sensible sequence for reducing energy use is:

1. Measure: understand the bill, the interval data and the main loads.
2. Switch off and schedule: remove unnecessary base load and running hours.
3. Fix faults: leaks, failed sensors, dirty coils, broken controls and damaged seals.
4. Reduce loads: shading, insulation, sealing and moisture control.
5. Upgrade equipment: LED lighting, variable speed drives, efficient motors and heat pumps, especially when equipment is due for replacement.
6. Generate and store: solar panels and, where justified, batteries.

The order matters because each step changes the next. Reducing cooling loads may mean a smaller air conditioner is enough when the old one fails. Cutting base load and daytime use changes the right size for a solar system. The buying for the whole life of equipment article covers comparing equipment on lifetime cost rather than purchase price.

Solar and storage

Rooftop solar suits many businesses, particularly those using most of their power during daylight. A system sized so that most of its output is used on site is usually better value than one that exports a large share, because export payments are typically much lower than the price of power bought. Before installing, check the roof’s condition and structure, any network connection limits and approvals required by the local distributor, and lease arrangements if you rent. Batteries can help reduce demand charges or shift solar energy into the evening, but their economics depend heavily on your tariff and load profile, so model them carefully.

Prove the savings

Energy use changes with the weather, production and opening hours, so a lower bill does not necessarily mean an improvement worked. Set a baseline before making changes, then compare like with like: the same months, adjusted for activity and, for heating and cooling, for weather. Weather adjustment commonly uses degree days, a measure of how much colder or warmer each day was than a reference temperature. Sub-meters on major loads, such as a coolroom or compressor, make verification much easier. The from footprint to drivers article covers setting a baseline and tracing it to the variables that drive it.

Leased premises

Tenants often control only part of their energy use. The landlord may own the air-conditioning plant, the roof and the lighting. Upgrades may need the landlord’s consent, and the benefits may be shared. Raise energy at lease negotiation or renewal, and agree who pays for and benefits from improvements.

A worked example

This is an illustration. A 25-person wholesale distributor operates from a 3,000 square metre warehouse with a 300 square metre office and a small coolroom. It is open about 60 hours a week. Annual electricity use is about 210,000 kWh, costing roughly $63,000 at an illustrative average of $0.30 per kWh including all charges.

Base load. The interval data shows the site drawing about 12 kW at night and on weekends, when it is closed for about 5,600 hours a year. The coolroom legitimately accounts for part of this. An after-hours walk finds one section of warehouse lighting on all the time because a timer had failed, office air conditioners running on weekends, two exhaust fans left on and a hot water urn heating continuously. After fixing these, the base load falls to about 7 kW. The 5 kW reduction over about 5,600 hours saves roughly 28,000 kWh a year, or about $8,400.

Lighting. The warehouse has 60 metal halide high-bay fittings drawing about 400 W each, or 24 kW, for about 3,120 operating hours a year: roughly 75,000 kWh. Replacing them with LED fittings drawing about 150 W each cuts the load to 9 kW. Occupancy sensors in low-traffic aisles reduce running hours by an estimated 20%. New lighting energy is about 9 × 3,120 × 0.8, or roughly 22,500 kWh, saving about 52,500 kWh, or roughly $15,700 a year. At an illustrative installed cost of $600 per fitting, or $36,000 in total, the simple payback is a little over two years.

Coolroom. The strip curtain is torn, the door is often propped open during loading, and the condenser sits in afternoon sun with a coil clogged by dust. The business replaces the curtain, fits a door alarm, cleans the coil and builds a simple shade over the condenser. Because the effect depends on the season, the business installs a sub-meter and will compare the same months next year rather than estimating the saving now.

Office. West-facing windows overheat the office in summer afternoons. External shading is fitted, ceiling fans are added, and the cooling set point is raised slightly. These savings will also be checked against next summer’s sub-metered data.

Together, the measured and calculated changes save around 80,500 kWh a year, about 38% of the original use, worth roughly $24,000 a year. Only then does the business get quotes for solar, sized to its reduced daytime load.

How this applies to a small Australian business

• Understand your tariff and which charges dominate the bill.
• Ask for interval data and look first at base load.
• Walk the site after hours.
• Reduce heat and moisture loads before buying more cooling.
• Fix leaks, faults and dirty coils.
• Use variable speed drives where fans and pumps are throttled.
• Upgrade lighting with controls.
• Size solar after reducing loads.
• Measure before and after, adjusting for weather and activity.
• Use licensed trades for electrical, refrigeration, air-conditioning and plumbing work.
• Check current government and retailer programs, which change from time to time and vary by state.

Common mistakes

• Starting with solar before reducing waste.
• Ignoring base load.
• Buying bigger air conditioners instead of reducing heat gain.
• Leaving compressors running overnight.
• Throttling fans and pumps that could slow down.
• Assuming a lower bill proves a saving.
• Overlooking moisture, which drives condensation, frost and wasted cooling.

Questions to ask

• What does our site draw when nobody is working?
• Which charges make up most of our bill?
• Where does heat enter the spaces we cool?
• How much of our compressor’s output goes to leaks?
• Which fans and pumps run at full speed when they do not need to?
• How will we know whether a change has saved anything?
• Who owns the equipment we want to upgrade?

Bringing it together

Energy waste in business premises usually sits in a few predictable places: base load when nobody is working, heat and moisture entering spaces that are then cooled, compressed air leaking away, fans and pumps running faster than needed, and outdated lighting. Start by understanding the bill and the interval data, walk the site after hours, then fix the cheap things first: switch off, schedule and repair. Reduce heat and moisture loads before buying equipment, upgrade when it makes sense, size any solar to the reduced load and measure the results properly. Done in that order, each step makes the next one cheaper.

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Source: KEVOS notes, drawing on earlier KEVOS building engineering handbooks on low-energy cooling and passive design, green building performance and psychrometrics for HVAC design. Examples and figures in this article are illustrations. This article is general information and does not replace advice from licensed trades or qualified engineers.