What your business can do to mitigate high heating bills this winter
Soaring domestic and global natural gas prices are driving energy bills up to highs not seen in several years. What can your business do to protect your bottom line this winter?
Many US cities experienced their hottest summers on record this year, creating a surge in cooling demands that took out much of the country’s natural gas supplies. Hurricanes Ida and Nicholas have natural gas futures hovering near a seven-year high.
Natural gas is America’s preferred source of energy. It powers and heats factories, businesses, and homes all across the country. With natural gas prices soaring to new heights (over $5 as of mid-September) and winter soon approaching, customers across the country should anticipate their highest heating bills in years.
There are natural gas constraints happening globally as well. Europe, South America, and Asia are experiencing their own natural gas shortages due to a number of factors, thus countries in these regions are paying premium prices for liquid natural gas (LNG) supplies from the US.
Rising natural gas prices often translate to rising power prices for businesses, and with prices continually on the rise, businesses will be urged to lock in their business energy tariffs before prices climb any higher.
Businesses can protect their budgets and bottom lines now through the type of business energy contract they procure. They can also use energy more wisely by looking to adjust operations during off-peak periods, powering down equipment when it is not in use, improving energy efficiency, and more.
Review the type of contract you plan to procure
Energy suppliers offer a range of products that suit the needs of their business customers. Choosing a fixed, flexible, or combination priced plan depends on how you operate as a business and use your energy.
Fixed priced plans are best when you want to budget with certainty. These types of plans are low in risk in that you lock a set price you pay per unit of the energy commodity throughout the life of the contract. Even when commodity prices climb in the market, you continue to pay the same rate that you negotiated with the supplier. This is a safe option considering the soaring power market prices as of late.
The high risk, high reward option is through the flexible (or indexed) priced plan. In this plan, commodity prices are linked with the current market rates, so if the price per unit rises or drops, the price you pay on your energy bills rises and drops, too.
To balance budget certainty and risk, look towards a combination priced plan. This involves locking a percentage of your energy load at a fixed price and letting the remaining load be priced according to the market. The percentage you lock in and the percentage you want exposed to market prices are up to you. You can have greater budget certainty and less risk by locking in a higher percentage of your energy load and let the remainder be subject to the current commodity prices.
Consume energy more efficiently
Cutting wasted energy helps you save money (and reduce carbon emissions to boot). To see exactly where and how your business energy is being wasted, it is necessary to see reports of energy usage.
Energy management systems (EMS) are designed to provide you with that information. The hardware and software technology of an EMS solution allows you to visually see, through graphs and reports, just how much energy your business is using and losing.
With or without an EMS solution, one of the easiest ways to reduce energy cost is to optimise the way in which it’s already used. You can become more efficient by reducing energy consumption by switching off lights and charging points, powering down PCs and equipment, or using energy-intensive machinery only when required.
Set your thermostats wisely
Lowering your thermostat during the winter sounds like the last thing you would want to do during a frigid period of the year. Hear us out.
One of the common ways businesses waste money during cold seasons is by overheating spaces or heating unused spaces. When heating the spaces that are often occupied, aim to set the thermostat to a temperature where you and others can stay comfortably warm. Dress appropriately to help you stay warm.
Energy.gov recommends for thermostats in your average sized rooms to be set during the day to 68 degrees Fahrenheit. When the rooms are unused, such as during closing times, it is recommended to lower the temperature 10-15 degrees. For each degree lower you set the thermostat during off-times, you save around 3 percent on your heating bills, according to EnergyHub.
Stagger operations throughout peak hours
Business energy is often most expensive during peak hours, or your standard 9-5 working day. Powering machines and equipment during normal business hours is unavoidable. However, if at all possible, look to stagger when you use your assets during peak hours.
Pulling a steep load from the energy grid is costly, too. This often happens at the start of the day or during the busiest times of the day, when most or all equipment is being used. In the morning, look to selectively turn on your equipment at different times.
You will have to plan ahead carefully to pull this off, but it will help you save a bit from your energy bills in the end.
Keep regular HVAC maintenance
Keeping your heating, ventilation, and air conditioning systems maintained regularly helps tremendously towards reducing your energy bills. Beyond this, HVAC inspections also identify any major problems in these systems that could be expensive to address, not to mention that these problems may pose a danger to you and others in your business.
Let in the sun
Whenever the sun does shine during the winter months, do be sure to let it in! Open up your blinds and let the sun naturally light and heat your offices during the day.
To capture all the heat, you will want to ensure your walls, windows, and ceilings are sealed tightly. Keep exterior and freight doors closed as often as possible.
These big and small steps add up to major energy bill savings
Energy prices are expected to climb higher this coming winter and into the next year. By procuring business energy smartly and doing the little things to utilise your energy efficiently now, you can achieve savings to your power bills now and in the future.
Our energy experts at Northern Gas and Power Americas are ready to help you find your next business energy contract that suits your business and energy needs. We can also advise you on how to best use your energy.
Get in touch with us today by calling +1 972-331-0039.