Powering Up After COVID-19

Powering back up after lockdown isn’t as straightforward as it sounds. In March 2020, food and beverage businesses began to shift operations in response to COVID-19, with measures taken across Australia to enforce social distancing and reduce on site occupancy.

Now, as state governments ease restrictions, you might be thinking about resuming business as usual.

But before you do, there are some important things you should be aware of to reduce your energy costs and avoid additional charges.

Below are some quick and easy tips to help your business power up operations back to normal.

Start on the front foot
If you are still on partial or total lock-down, this is a great opportunity to revisit your processes and consider energy efficiency upgrades or a new energy contract.

Consider an energy agreement that connects you with the true price of energy so that you can align your operations with times when energy is cheaper.

Get the timing right
Powering up during times of high demand puts a strain on the energy system and can lead to higher energy costs.

Even though you may be powering back up to normal levels, you may need to pay increased tariffs due to the demand you’re putting on the system.

Some equipment takes longer to start up, so start early. This may include a tap beer glycol system, post mix system, refrigeration and freezing units, as well as heating and air conditioning.

Automating your processes can help too. This may include setting your heating or cooling to come on at a certain time or using the self-clean function on a combi oven when demand for power is low.

Know your operations
Start with business critical operations and work your way towards full operations.

With patron limits, this could mean opening just one dining area midweek, offering a limited menu to operate less back of house equipment and simply using one front of house service area.

Take it easy with lighting
Your first instinct might be to turn on all of your lights, but lights can be a major energy drain.

When powering back up to full capacity, only light the areas you need and switch to energy-efficient lighting like LEDs and CLFs.

Keep it cool
Restocking fridges to full capacity will help them to chill faster and use less power to maintain temperatures.

For fridges that have been hibernated, position these in well-ventilated areas away from sunlight or heat from other equipment.

Powering your venue back up in stages will help your business avoid spending more than it needs to on power and will also help support the energy system.

Get ready for the future
If your energy agreement is up for renewal, use this time to look for a more flexible solution.

Energy rates have fallen to four year lows so choose a solution that reflects this change.

If you want to make the most of prices continuing to fall in the future, consider a plan that allows you to move to the new lower rate.

Get Power Active
If you’re looking for a flexible energy plan that connects you with the real price of energy and allows you to make the most of falling energy rates — it’s time to get Power Active.

Visit the Flow Power website to find out about the ways Power Active is helping Australian businesses save on energy costs. Click here.

How to make your assets earn money for you

What would you do if you were a food or beverage manufacturer or processor and you were told you could save your company thousands of dollars in energy bills every year? Most companies would sign up straight away. But what if part of the condition was that at some point in time throughout the year, certain pieces of plant or machinery were switched off. Pretty risky, right? Not so according to Andrew Sutherland from Enel X, a company that specialises in helping businesses – including those in the food and beverage sector – optimise their energy needs.

Sutherland, who is a consultant for Enel X, works with businesses to strategically reduce their energy demand, based on a signal of electricity grid need or shortage, and to monetise this activity. He said that persuading a company to switch off equipment is probably the hardest sell. But, what if there was no risk involved at all? That, said Sutherland, is the key.

“The trickiest part is going into a business and convincing them we can automate a process that will save them energy and money – even earn them money – by turning off a machine and that it will have no impact on their operations,” said Sutherland. “They have to get their head around the idea that we are going to turn off certain parts of their process at a certain point in time. It is only a handful of hours every year.

“I was explaining the concept recently to an abattoir owner and he said, ‘I have 800 staff. I can’t be turning off equipment’. I explained to him that it wasn’t about switching off all of the equipment. It’s about certain assets being turned off at the right point in time.”

Flexibility
Enel X is a subsidiary of Italy-based Enel Group, which is one of the 100 largest companies in the world with revenue in excess of $126bn in 2018. The company sees a gap in the market where companies can not only save money on their energy consumption, but can contribute to the national grid and even
earn money.

Sutherland said that the company comes to the market with a different point of view to a lot of others in the same space. Enel X helps organisations to reduce costs without the need for investment in new infrastructure, by making equipment more efficient. It has expertise and history working with businesses to identify elements of their existing infrastructure and assets or processes that can help deliver a cost reduction if they are used in a slightly different way.

“We work with businesses to identify what they have, what they could have, and then roll those assets and processes into flexibility or demand response programs that help them lower costs. Importantly, the equipment used fully serves its operational purposes, and further benefit is extracted based on what the equipment can provide to the grid,” he said.

For example, Sutherland talks of a business in Victoria that specialises in cold storage. It houses food and beverage products. What Enel X did was help the company manage its assets in a way that it could curtail the energy load of the refrigeration units at a strategic point in time. This not only saved power, but helped that customer earn revenue from the market to help support the grid and the broader community.

“We installed a meter, which is a technical solution that we set up onsite. It recorded when there were disturbances in the grid as a whole,” said Sutherland. “When that occurred, we sent a signal for only the assets they nominated to make a response that provided value to the grid and therefore earned the customer revenue. For this particular customer, he estimated that year-on-year over three years he saved about 10 per cent on his power bill.”

Companies are surprised how much money they can save, according to Sutherland. Demand response, or power flexibility, has been in Australia for many years, however to many it is a new concept. The market is constantly evolving and transforming, with new opportunities for businesses to take part in the market from a demand point of view.

“We are at the forefront of the changes in the rules. We are an advocate for many changes as well,” said Sutherland. “Our history as a global organisation means we know how valuable power flexibility is. As an organisation worldwide, we have enough power flexibility in our portfolio that can manage the state of Victoria on any normal day. Our expertise is with flexibility and demand response. We are the world’s largest operator in this space and we are also the largest aggregator of load to our market operator in  Australia.”

While it makes business sense to use the service – after all what business doesn’t want to save money – Sutherland also points out that not only is the solution practical, it might also soon prove to be a necessity in some parts of the country.

“In the past four months there has been a series of issues that have had an effect on the grid,” he said. “We’ve had outages with generators in Victoria where two generators were out of action for the majority of 2019, which caused a lot of concern about the reliability of the grid. There have been outages between Victoria and Tasmania with the Bass link. In the past couple of weeks there were a few events between Victoria and South Australia, which has needed assets like ours. Using our service, businesses that offered their flexibility are be paid for making a contribution to the support of our grid. That helps our whole community.”

Sutherland believes that, at the moment, the national power grid finds itself at a critical juncture where there is not enough wind and solar power available to cover any shortfalls in power supply, while battery storage is still too expensive. He also believes Australia hasn’t hit a critical mass to help the transition. The country has hit a point where the grid now needs flexible assets and flexibility that will help advance the transition.

“The drivers in the community are for decarbonisation and climate change,” he said. “People in that frame of mind support the use of flexibility because it advances the situation we want. When we don’t have enough wind or solar, we need flexibility at that point in time to keep the grid stable and to ensure that we are not stifling more investment.”

Sutherland can’t reiterate enough that it’s not about turning off the equipment all the time, it has got to be strategic and it has got to be low impact if at all.

Enel X has proprietary software that helps the customer maximise the outcomes to the market. There is software around the trading and dispatch notices but ultimately it is an automated process that combines hardware at the site and software on Enel X’s end.

“We use a combination of hardware and software,” he said. “We need to install certain meters that will sense all the disturbances in the grid and then give a signal to the site.”

He also points out that there is an underutilised power supply available that a lot of big multinationals in the food and beverage industry have and, again, they could earn money from them – standby generators.

“There are a lot of businesses out there who have realised that the reliability of the grid is not as good as it once was so they have made investments in standby generators,” he said. “These investments are substantial for an asset that sits there largely dormant waiting for the power to go out. What we do is we turn those assets into an active market participant. That asset helps to support the grid in terms of need and in price.

“A back-up generator has an invaluable role. For example, in South Australia when they had the outages in 2016, a lot of the businesses did have generators but they were not adequately maintained and many were not available at the time that the customer actually needed it. By taking part in the power flexibility programmes, they are actively used. It is not a dormant asset.”

Sutherland cites an example of a bakery he has been working with. If it loses power they have a huge amount of waste that will happen; the company will have idle staff, and can only get a certain amount of product out the door if they run on their generator.

“It is an asset that is there, but it is underutilised and it is not properly configured for the site,” said Sutherland. “We are working with that business via a grant and funding with the SA government, to help them get to a situation where the sustainability of their operations is maximised. If there is an outage, they will be able to get all the product through the process and out the door. They therefore minimise waste, which is great for the environment – all the conversion of the resources, all the labour is not idle. Generators play a critical role because the grid, in its simplest form, is no longer reliable as it once was.”

Sutherland expects that their offering might take a little bit of time for some companies to comprehend. However, once they get the details sorted out, it is win-win situation.

“We do not expose the customer to any form of market risk,” said Sutherland. “We incentivise them, and the government incentivises them, and we need their flexibility. We are going to do it in a controlled way so that all of your operations are not affected in any way.”

Is that hissing noise the sound of money going up in smoke?

One thing that never fails to amaze Greg Gillespie is the amount of times he walks into a manufacturing or processing plant and hears hissing. It immediately tells him that they are running an air compressor or a bank of air compressors. It also tells him that the company is throwing money down the drain. That hissing sound is either one, or a series of leaks, coming from the compressed air system.

Gillespie, who is the national sales manager for air compressor manufacturer ELGi, said that in some cases companies are literally throwing thousands of dollars down the drain every year. Not only that, but when he hears that tell-tale sign of hissing, he knows that doesn’t include the ones he can’t hear.

“I’ve walked into a lot of different places – and to be fair my ear is tuned for it – and I immediately hear all the air leaks,” he said. “And I’ll say to the person on site, ‘you’ve got a few air leaks’. They generally reply, ‘no we don’t’. They don’t hear them because it is background noise to them.”

What he encourages people to do is stay back for five minutes after the work day when everything is quiet. He’s confident that they will then hear the noise.

“And the thing is, if you can hear an air leak, it’s a large one. There will be quite a few air leaks you’ll never hear without ultrasonic equipment, especially if they are inside a piece of equipment,” he said.

Gillespie said the culprits in these leaks are usually the same range of suspects – hose clamp connections, seals failing, and worn fittings. And he’s not saying that maintenance managers have to fix them all at once. He knows that, especially in the some of the bigger food and beverage manufacturing and process plants, it can be a big job. A maintenance plan is needed and such a plan is not something whereby a leak is fixed once and then forgotten about. It will depend on the size of the factory and plant and how many compressors are working. He acknowledges it would be a big task to do it all in one go, so maintenance managers would set about a plan to go and rectify the leaks starting with the biggest one first. Then they would just do a constant, weekly check. But what is the cost?

“If someone has an air audit done then they start to realise that ‘holy heck, we’re leaking thousands of dollar per annum’,” he said. “The more plant and machinery you have in place, the more the leaks are going to cost your bottom line.

“If you have a small place with a 2.2kW compressor, then that cost isn’t going to be that high. But if it is a larger factory with 100kW of installed compressor power, then it will cost a lot.

“I know of a place that has three 55kW machines. One of those 55kW machines pretty much services air leaks. If they fixed their air leaks they can turn one of their compressors off. Do the maths of 55kW of power running all day. They operate 24/7 – not at full capacity – but they are aware of it. I’m sure if you put all the numbers down in front of the people running the place, suddenly it wouldn’t be too hard to fix.”

Education is also a key ingredient. A lot of places he visits think the air is free. Quite often Gillespie will see people “sweeping” the floor with an air gun. It’s convenient, it’s quick, but it does come at a cost.

“Some think it is quicker doing it that way because it reduces the labour cost involved,” he said. “I routinely see people cleaning down their areas using air. It’s not a safe practice to do it.”

But what causes the leaks in the first place? The leak itself is being caused by faulty equipment, but what caused that equipment to become faulty in the first place? Gillespie believes that not only does the factory need the right air compressor for the right job, but it is also the type of air distribution network that is being used that can be a problem. This includes not only the size of the pipe that is distributing the air, but what it is made out of, too.

“I talk to people about becoming efficient, which starts with the right compressor and the right distribution network,” he said. “That is where things like the pipe size, pipe type (poly, aluminium, copper) and how you articulate it comes into play.”

A good distribution system will be one that will be less likely to leak over time – what sort of pipe and the distance over which it is set up are important considerations to limit pressure losses.

“The type of pipe is important because with some piping temperature changes can cause it to expand and contract, and start to bend and twist, so I much prefer people investing in rigid pipe,” said Gillespie. “Depending on the type of rigid pipe system you go for – if you go for something like a braised copper, or stainless steel or even aluminium/copper pipe with fittings – these are going to be less leaks than some other methods.”

If it is the wrong size pipe it will put unnecessary load on the compressor under pressure, which can induce something called artificial demand. This can be magnified if there are multiple compressors in the system, which can be very costly, he said. Gillespie also pointed out that there are also lots of government grants that can help companies become more energy efficient. They change on a regular basis. At the moment there is grant that finished recently that was available for companies that were replacing existing equipment with more efficient equipment with variable speed drives.

“I helped a customer do that and they got nearly 50 per cent of the price of the compressor rebated,” he said. “There is another grant available at the moment which is up to $5,000 rebate for people to put permanent monitoring equipment in to their plant so they can monitor the efficiencies of their compressed air system. Compressed air systems account for about 30 per cent of all industrial power.”

As part of the government’s push to increase energy savings and reduce emissions, they are encouraging industry to work in a more economical way and an area to do that is air compressors, said Gillespie. A lot of people think these things revolve around lighting and solar power. However, quite often there are grants going around to make more efficient compressed air systems.

For the bigger companies that are setting up a new system or refurbishing an older system, Gillespie said putting some budget aside for a monitoring system is also a good idea.
“I have a company I’m dealing with at the moment and they are going to need about 300kW of power. It’s going to be a couple of hundred thousand dollars’ worth of equipment and I’m putting monitoring equipment in my quote – $6,000 worth. To me, it would be absolutely crazy not to do it. The advantages are a no brainer on a system that size.”

Gillespie also cautions against overthinking too much about what to do. An air audit is a simple thing to do and that will give a clearer indication of what a company’s needs are and how they can be remedied.

“I would try not to oversell it because sometimes you can take somebody down that rabbit hole and they can become overwhelmed because they have been inundated with the information and data,” he said.

“You have to find that balance. There are instances where you might spend $10,000 to modify pipework and save yourself $1,000. There’s no payback.”

There are lots of things going on with flow and thermodynamics, you could easily make someone’s head spin.

“At the end of the day, a well-designed and maintained compressed air system is going to be more efficient. And that will save money every day of operation.”

How to improve your energy efficiency

Ahead of chairing the ‘Agribusiness and food processors: Smart energy use from farm to plate’ speaker session at the inaugural Energy Efficiency Expo, Bradley Anderson (Manager of Business Energy Solutions at the Energy Efficiency Council) shares his advice for food businesses looking to manage their energy intensive operations and improve efficiency.

Question: What are the biggest energy challenges for Australian businesses?
In my role at the Energy Efficiency Council I am responsible for business engagement and energy management market transformation. What I continue to see is Australian businesses grappling with electricity and gas prices unlike anything they’ve seen before. For many industries these rapidly rising costs are a challenge they’re not capable of dealing with easily. Due to Australia’s historically cheap energy, many Australian businesses have pursued a procurement focused energy strategy and once cheap supply contracts are secured, they haven’t paid attention to the energy management opportunities available behind the meter. Now that wholesale electricity prices have doubled and wholesale gas prices have tripled, businesses need to act quickly to offset these rapid rises in energy prices.

READ MORE: Energy efficiency Expo to focus on improving energy use at cutting costs

Question: Why should Australian businesses focus on improving energy usage & reducing their environmental impact?
Most experts agree that the electricity and gas price peaks of 2017 are unlikely to be replicated, but they also expect market prices to stabilise well above their historic averages. Costs are shifting rapidly, yet the transformation of Australia’s energy system has only just begun. Businesses that are leading when it comes to energy strategy have a clear understanding of how the energy system is evolving, the trends or technology driving this transformation, and how they can leverage these to thrive.

Question: Why are food businesses, especially their supply chains, so energy intensive & how can they be managed?
The supply chain for food businesses requires energy to be used in three fundamental ways to generate products and profit. From farm to plate, energy is required to move resources around such as pumping water to irrigate crops, or for heating things up like when baking bread or sterilising packaging, and for cooling food goods down in storage facilities or transporting to stores. Despite this reliance on energy intensive processes coupled with rapidly rising energy costs, since 2006 Australia’s agricultural industry has become 21% less productive with the energy it uses. The positive news is that there are still many ‘low hanging fruit’ opportunities to reduce energy consumption within the supply chain, however, without a systematic approach to energy management many of these low-cost and even no-cost opportunities won’t be identifiable. The simple fact is that businesses need quality data and analysis to make effective business decisions – and the same applies to energy.

Question: What approach can agribusinesses and food processors take to reviewing their energy use, management and supply?
Food business and agriculture are no different to any other sector, so developing a strategy for ongoing improvement of energy performance and having the data to inform effective decision-making is the best place to start. Additionally, the Commonwealth, New South Wales and Victorian Governments all have active programs to assist agribusinesses and food processors review and better manage their energy use.

Question: How does energy efficiency improvement benefit business?
In the agriculture industry, for example, we know that 74% of identified savings within small to medium agricultural businesses have a direct payback within 5 years, which shows large portions of energy saving can be unlocked through project implementation. Again, there are Government assistance program available to support these projects or help from expert advisors is also available.

Question: Is there a general approach agribusiness and food business can apply to improve energy efficiency within operations?
The traditional ‘plan, do, check, act’ cycle of implementing and continuously improving a formal energy management system has proven results, with energy savings of up to 30% being achieved regularly by businesses that actively participate in energy management programs throughout the world.

Question: Is there a single piece of advice or a recommendation you can give to food business and agribusiness about energy efficiency?
Yes, managing your energy use doesn’t have to cost you a lot of money, in fact it doesn’t have to cost you any money.

The inaugural Energy Efficiency Expo will be held from 23-24 October 2019, at the Melbourne Convention & Exhibition Centre, with a focus on helping organisations solve their energy affordability and productivity challenges through insights shared in the conference and solutions displayed on the exhibitor floor.

Visitors will also have the benefit of gaining access to the co-located All-Energy Australia and Waste Expo Australia. All-Energy Australia is the industry’s largest all-encompassing clean energy event, with a theme of ‘Advancing Australia’s transition to a clean energy future’ in 2019. Waste Expo Australia is also a free-to-attend industry event applicable to professionals within the waste management and wastewater treatment industries.

Together, the three industry events, will combine to form Australia’s most comprehensive opportunity for businesses to learn about renewable energy, energy efficiency and sustainable solutions.

Coles agreement secures three new solar power plants

Solar power plants capable of generating sufficient electricity for 39,000 homes* will be built in regional New South Wales following a landmark 10-year agreement between Coles and global renewable power generation company Metka EGN.

In the first deal of its kind to be made by a major Australian retailer, Coles will purchase more than 70% of the electricity generated by three solar power plants to be built and operated by Metka EGN outside the regional centres of Wagga Wagga, Corowa and Junee – the equivalent of 10% of Coles’ national electricity usage.

The photovoltaic solar plants will supply more than 220 gigawatt hours of electricity into the national electricity grid. Producing the same amount of power from non-renewable sources would result in more than 180,000 tonnes of greenhouse gas emissions^ every year, or the equivalent of the annual emissions of 83,000 cars**.

Coles Group CEO Steven Cain said the increased use of renewable energy was a major part of the company’s commitment to be the most sustainable supermarket in Australia.

“Coles has been a cornerstone of Australian retail for more than 100 years, and ensuring the sustainability of our business is essential to success in our second century,” he said.

“We are thrilled that with this agreement, Coles can make a significant contribution to the growth of renewable energy supply in Australia, as well as to the communities we serve.

“We have already made changes throughout our business to use energy more efficiently, which has enabled us to reduce our greenhouse gas emissions by 4 per cent over the past financial year and more than 30 per cent since 2009, despite growing our store network.

“Over the past two financial years alone we have invested more than $40 million in energy efficiency measures including upgrading all store lighting to LED by the end of 2019 and the installation of solar panels on 30 stores.”

Coles Chief Property and Export Officer Thinus Keeve said Coles was the first major Australian retailer to commit to buying renewable energy through a Power Purchase Agreement.

“Agreements like this are crucial to growing renewable generation capacity in Australia because they give the developers the certainty they need to invest,” he said.

As well as supporting large-scale generation projects, Coles is working with property partners to increase on-site generation of renewable power at stores and distribution centres.

“We plan to install solar panels on another 38 stores this financial year and we will be working with our landlords and property developers to identify further locations suitable for on-site solar power generation,” Mr Keeve said.

The projects announced today were developed by Australian renewable energy developer Terrain Solar, with the support of advisory firm PwC, as part of a portfolio of renewable generation plants.  Metka EGN acquired the portfolio earlier this year and will build, operate and own the plants.

“Terrain Solar is incredibly proud of this landmark agreement that will underpin the construction of three new renewable energy plants in regional New South Wales” said Terrain chairman David Griffin.

The new solar plants are expected to support more than 250 jobs in regional NSW, including over 240 during construction and 10 ongoing roles.

Construction is scheduled to begin in September and the plants are expected to commence supplying power to the grid in July 2020.

 

Data reveals how businesses can reduce energy costs for all Australians

Flow Power modelled the energy spend of 670 businesses and what could have happened had they all been purchasing wholesale power last financial year.

It would only take 670 businesses to drive investment in 1845 megawatts of renewable generation.

If 670 businesses had purchased wholesale power last financial year, they could have saved up to $97M in total.

This figure more than doubles when businesses sign onto corporate renewable PPAs, which could have delivered savings of up to $195M in total.

READ: Combine demand response with PPAs for maximum saving, says research

At the start of 2018, demand response could have cut South Australia’s power prices by 2.7c/kWh.

Businesses forgoing fixed-rate contracts for wholesale prices could expect significant price reductions.

Flow Power directors and senior business managers unpack the numbers in a webinar on the 9th of October.

Join the webinar here.

Better Power Businesses that are tapped into the wholesale power market are more in tune with its highs and lows, and are best placed to respond to peaks in demand and soaring prices.

These businesses have the power to keep power prices down and the lights on for everyone – even during periods when demand is at its peak.

In the first quarter of 2018, South Australia’s business could have reduced energy prices by 2.3c/kWh for the entire state, simply by choosing to power down during peak price events.

Drive Investment Businesses have a critical role to play in the investment in Australia’s growing pipeline of renewable energy projects.

If 670 medium and large-scale businesses across Australia made the decision to contract renewable energy through corporate renewable Power Purchase Agreements (PPAs), this would drive investment in more than 1845 MW of renewable generation.

Lower power bills Businesses sign up to buy a portion of the output of renewable generators for periods of up to 10 years through corporate PPAs pay significantly lower prices and benefit from price certainty for the life of their contracts.

If the 670 businesses analysed by Flow Power signed up to renewable corporate PPAs, they would have saved up to $195 million in total on energy costs in the last financial year.

Without PPAs, choosing to buy wholesale power still delivered significant savings of up to $97 million in total. Matthew van der Linden, managing director of flow power, said Flow Power knows that the traditional fixed-rate model is no longer meeting Australian businesses’ needs for cheaper, more transparent power solutions.

“The benefit of connecting businesses to the true signals of the energy market, either through PPAs or wholesale power, is twofold.

We see businesses save on what can be their most costly expenditure – energy – as well as everyday Australians benefitting from greater investment in renewable generation and lower energy costs delivered by wholesale demand response,” he said.

“This can be achieved without new policy or government intervention, all it would take is businesses choosing to take more control over their power.” said van der Linden.

David Evans and Nathan Epp from Flow Power will discuss the numbers at the webinar on the 9th of October.

Register today.

Data reveals how businesses can reduce energy costs for all Australians

New research from energy retailer, Flow Power, shows that businesses forgoing fixed-rate contracts for wholesale prices could expect significant price reductions.

In a study of 670 medium to large businesses, wholesale power would have delivered savings in total of up to $97 million for the last financial year.

This figure increases significantly when renewable corporate Power Purchase Agreements (PPAs) are added in.

Businesses that are tapped into the wholesale power market are more in tune with its highs and lows, and are best placed to respond to peaks in demand and soaring prices.

READ: Combine demand response with PPAs for maximum saving, says research

These businesses have the power to keep power prices down and the lights on for everyone – even during periods when demand is at its peak.

In the first quarter of 2018, South Australia’s business could have reduced energy prices by 2.3c/kWh for the entire state, simply by choosing to power down during peak price events.

Businesses have a critical role to play in the investment in Australia’s growing pipeline of renewable energy projects.

If 670 medium and large-scale businesses across Australia made the decision to contract renewable energy through corporate renewable Power Purchase Agreements (PPAs), this would drive investment in more than 1845 MW of renewable generation.

Businesses sign up to buy a portion of the output of renewable generators for periods of up to ten years through corporate PPAs pay significantly lower prices and benefit from price certainty for the life of their contracts.

If the 670 businesses analysed by Flow Power signed up to renewable corporate PPAs, they would have saved up to $195 million in total on energy costs in the last financial year.

Without PPAs, choosing to buy wholesale power still delivered significant savings of up to $97 million in total.
“We know that the traditional fixed-rate model is no longer meeting Australian businesses’ needs for cheaper, more transparent power solutions,” Matthew van der Linden, managing director of Flow Power said.

“The benefit of connecting businesses to the true signals of the energy market, either through PPAs or wholesale power, is twofold. We see businesses save on what can be their most costly expenditure – energy – as well as everyday Australians benefitting from greater investment in renewable generation and lower energy costs delivered by wholesale demand response. This can be achieved without new policy or government intervention, all it would take is businesses choosing to take more control over their power,” he said.

 

 

Meeting the food & beverage industry’s energy needs

With wholesale energy prices in Australia predicted to rise by as much as 200 per cent over the next three years, the need to manage energy costs in business is becoming urgent.

Energy accounts for one of the most significant areas of cost for the majority of industrial businesses – especially those with temperature-intensive processes such as in food and beverage manufacturing.

Australian Food and Grocery Council CEO, Tanya Barden says the food and beverage industry is facing increasing pressure due to high energy costs.

“There is no doubt Australia’s largest manufacturing sector is facing an environment where input costs are rising on everything from commodities to labour to energy, and six years of retail price deflation continues to cut margins, placing the sector under increasing pressure,” she said.

“We are expecting these pressures to only increase as energy, especially gas, has seen a doubling and in some cases a tripling of price that is likely to have dire consequence for Australian jobs and investment, with some companies re-assessing their long-term future in Australia.”

Australian Meat Industry Council CEO, Patrick Hutchinson said high energy prices have already placed meat processing jobs at risk.

“We have one lamb processor in Victoria who is seeing close to $600,000 to $1 million increase in energy prices in a year,” he said.

“We’ve also seen major domestic beef processing go in Ipswich with 500 jobs.” “It’s never been more important to manage energy costs.”

There is also constant pressure on the food and beverage processing industry to reduce emissions with many organisations looking to optimise their energy use.

In its White Paper Industrial Energy Strategic Opportunity, design, build and facilities management specialists Wiley predict the future for industrial energy and explain what businesses need to do to gear up for the opportunities ahead.

In the White Paper, Brett Wiskar, R&D and Innovation Director at Wiley, outlines effective solutions for businesses in the food and drink processing sector to harness new technologies and build long- term resilience in energy efficiency, supply and cost and ultimately remain competitive.

The solutions include increasing efficiency and reducing consumption, introducing solar production either, in isolation or in conjunction with battery storage. CONT

“To reduce consumption and increase efficiency, businesses need to optimise the use of their existing equipment, install effective metering equipment and ensure effective shutdown procedures are in place.” said Wiskar.

“Operating temperatures and the pressure of equipment and processes should also be optimised and heat gain into fridges and boilers should be minimised as much as possible. Maintaining equipment is also important.”

According to Wiskar, installing solar panels and storing the energy for later use can be one of the most effective means in reducing energy bills.

“Australia has ample access to solar with falling install costs starting to drive up larger scale industrial adoption. In addition to generating your own energy with solar panels, energy captured at peak times can also be stored for later use.”

“There’s now a number of technological solutions on the market for effectively storing energy and we continue to monitor and work with the leading developers in the world to ensure the best technology is available to the Australian manufacturing industry,” Wiskar said.

Industry and executive leaders must ensure their operations remain profitable into the future in spite of energy volatility and growing costs.

 

The power of efficient food processing

In light of Australia’s bid to reduce its carbon emissions by 2030, Steven Impey takes a look at how the food-processing sector is reacting to changing views on energy cost.

Energy consumption within the food sector is increasingly becoming a matter for concern – from the farmland where food is grown, right up to the processing methods that put packaged meals on supermarket floors.

Amid a growing energy crisis across Australia and the country’s bid to improve its carbon footprint, industry leaders are saying that now, more than ever, it is vital to react quickly.

To stave off climate change, the federal government is aiming to reduce its emissions by 26-28 per cent from its 2005 levels by the year 2030.

At the same time, power generated from the grid in mainland states is expected to rise to somewhere between 75 and 220 per cent in the next 20 years.

The question is: how are food-processing plants, and especially those that are reliant on a constant flow of energy, going to cope?

Spotting diminishing returns

Wiley, who design, build and maintain facilities, seek the latest approaches and technology to ensure they offer the best efficiency solutions.

Brett Wiskar, the company’s R&D and innovation director, believes that finding the link between the cost of energy and profitability is a pressing issue for many food processors.

“The real trick in reducing the impact and cost of energy is spotting the point of diminishing returns,” Wiskar said. “The opportunity to find power savings and wasteful systems in a manufacturing business is available to every operator in the food industry.

“To remain competitive both domestically and internationally,
our food sector has to find both the means to control energy costs and the means to lower their consumption as a percentage of output.”

Rather than deciding on a tactical expansion – for example a new product

line or facility expansion – businesses will start to give more consideration to the associated energy cost.

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Red meat consumption is in decline.

 

In turn, this enables businesses to take earlier steps to being self- sufficient in power generation and makes them better able to make tactical moves in the market.

Pressure is also being placed on companies within the supply chain to reduce greenhouse gases by – in some cases – more than 50 per cent by 2020. Among them, leaders in the meat and agricultural sectors are considering the consequences if the industry doesn’t address its energy use.

Addressing climate issues

Last year, a report by the Australian Meat Processor Corporation (AMPC) looked at the impact increasing average temperatures are having on the condition of cattle in the processing sector.

The report explained that, while maintaining a social licence to operate can be difficult, the red meat industry is seeking to avoid costs by increasing advocacy and research into offsetting carbon emissions of animals and the environmental impact of grazing.

It also raised the issue of increasing acidity in Australian soil, which it claims is affecting an estimated 50 million hectares of agricultural land.

To address climate issues, the AMPC is working with its members to help them better understand and reduce their own energy costs, which may include undertaking regular research into new initiatives and systems.

“Australia is facing a changing natural environment with increasing incidences of extreme weather events and changing weather patterns that directly impact the industry,” an AMPC spokesperson told Food and Beverage Industry News.

“We recognise this and continue to work to raise awareness about Australia’s changing climate and the impact it is having and will have upon our sector.”

AMPC is investing in research that seeks to understand “critical vulnerabilities in the value chain” as well as investigating technology, infrastructure options and mitigation techniques to minimise the industry’s impact on the environment.

Collaborate effort

In an address at the 2XEP Energy Productivity Summit in Sydney in April, the impact the ongoing energy crisis will have on industry was top of the agenda.

“Over the last 10 years, we have seen a decline in red meat consumption,” said Carl Duncan, who is group manager for resource efficiency at beef supplier Teys Australia. “High [energy] costs and competition mean the industry needs help.

“We would be the first to put our hands up and say that, while working collaboratively with government, we all need to help work through the energy crisis we are experiencing at the moment.

“What we would like to see is consistent policies [from the government] because, with large corporate companies and the current energy crisis being so rapid, it can be difficult for them to react.”

Using renewable sources of energy is one area were Teys is managing its consumption. By diverting wastewater, they have managed to offset 20 to 30 per cent of the company’s natural gas needs across their portfolio.

“The fact is: the energy crisis is putting unsustainable pressure on the industry, with energy markets increasing from 60 to 170 per cent in the last year and natural gas is increasing too,” Duncan added.

“Throwing stones isn’t going to solve the problem, so we all need to collaborate together to help solve it.”

In most food businesses, wastewater – whether a bi-product or as a consumable – contains organic matter, which keeps it at an artificially high temperature.

“Both the elevated temperature and the organic mater are potential sources of energy available to a food production business,” Wiskar explained.

“Through the implementation
of bio-energy recovery systems, businesses are able to harvest energy locked in the organic matter suspended in their wastewater.

“Covered anaerobic ponds or closed tanks allow the biological matter to breakdown generating bio-gas, which can be burnt to create energy.

“In addition, waste heat recovery systems can allow hot water and steam to be used as a source of energy through a range of potential conversion systems.”

Expectations are changing

Simplot, based in Victoria, is one of Australia’s leading food manufacturers for some of the world’s well-known packaged and canned food brands.

Speaking at the 2xEP Summit, the company’s manager for national continuous improvement, Carmel Gilles, explained how “integrating lean processes” is helping reduce energy cost.

“At Simplot, we have created a framework for continuous development and sustainability,” Gilles said. “A system where we can audit all of our sites to find where the gaps are and that helps us generate our plans. “

Their customers are also expecting are harder drive on energy and sustainability improvements. To do this, Simplot is engaging all of its employees to help make a difference.

Wiley are working closely with the food industry, empowering more companies to follow the same example.

“Simple wins exist in most food production businesses and are, generally, easily identified by auditing the operation to determine where power is currently being consumed,” Wiskar said.

“However, just because a change in the production process might reduce energy consumption doesn’t mean savings are scalable with continued long-term positive impacts.”

Simple solutions are often powerful and within reach – whether by changing the insulation or the means of exhaust within a production facility.

In addition, business operations often feel stuck with their current level of energy usage due to the “sunk cost” fallacy, where managers are reluctant to replace equipment that may be wasteful.

“This is despite the fact that a newer, more energy-efficient system might pay for itself – and the equipment it replaced – through energy saving alone,” Wiskar added.

“Exploring energy cost reduction through innovation is rarely a waste of time.”