Fight for Your Business with GreenBy Tyler Erickson
Article Date: 02-01-2010
Copyright(C) 2010 Associated Equipment Distributors. All Rights Reserved.
On numerous fronts you can attack waste and inefficiency, which not only benefits the environment and your company image, but puts plenty of green back on your bottom line.
Green is everywhere these days. Green jobs, green products, green cleaners, green cars, green building materials, green, green, green! But what about the guys in the trenches, servicing, delivering and operating equipment? What does green mean to them? Off-Highway Tier 4 emissions for one, diesel particulate traps and higher maintenance costs for another. But green isn’t always expensive and troublesome. Being green can help make your company stronger, more efficient, and more competitive. It can help you be ready to come out of this economic downturn with both barrels blazing, ready to bury your competition.
So how do you go about it? How do you turn your company into a lean, green fighting machine? Start with the three “I”s: Identify, Improve, Invest. Then follow them up with four “R”s: Reduce, Reuse. Recycle, Renew. Sounds great, lots of buzzwords; Now, how do we go about gittin’-er-done?
Identify waste – wasted energy, wasted effort, wasted time. Understand your business’ efficiency and inefficiency. What are your strengths, your weaknesses? Take inventory. (Hey, that’s another “I” word!) Inventory your energy usage, every bit. According to the U.S. Department of Energy nearly 76 percent of all energy used in commercial buildings is electricity used to power lights, computers, peripherals, and air conditioning. What kind of light bulbs and fixtures are you using? How many printers, copiers, computers are on all night? All weekend? How many forms/documents are printed needlessly? Do you use set-back thermostats to raise air conditioning set points, or lower heat settings when no one is in the office? Do your trucks have road speed limiting set to 62 mph? Do you reward your drivers based on the fuel economy that they achieve? Keeping tires pressurized to the manufacturer’s specifications saves fuel. So does slowing down.
Con-way Freight changed their Road Speed Limiting feature for their over-the-road trucks from 65 to 62 mph. This resulted in a 3.2 million gallon-a-year fuel savings. At just around 10 million dollars a year it added up to a 20 percent improvement in their bottom line. Would you like to see similar savings? Have your truck dealer set the RSL function to 60 mph. Sure your drivers will complain, but less time spent filling up means more time on the road, and more profit in your pocket. For every mph above 55 your fuel economy is reduced by 1 percent. As your speed increases above 65 mph it gets even worse. It takes 27 percent more fuel to go 75 versus 65 mph.
There are real savings opportunities here and it reduces greenhouse gasses, which is good for the environment to boot!
Major electricity savings can be realized in most buildings. Take your electricity usage inventory and identify where you use T13, halogen, sodium or mercury vapor lights. LED lighting is rapidly catching up in lighting technology and price. At four to 10 times greater efficiency, LED lighting will pay for itself in approximately three years, or even less in some applications. Another thing, turn off those darned lights, computers, printers, copiers and fax machines at night!
Use switchable power strips to power down every power supply, every piece of electrical equipment when they are not needed. Now you’re being lean, green and mean, you fighting machine, you. You’re fighting for your business, your employees, and your future. Being lean and green will set you up to succeed when your competition is sitting on their hands, afraid to move. Electric power generation creates 39.8 percent of greenhouse gas emissions in the U.S.; this accounts for more than all the trucks, buses, and cars in America combined.
InterContinental Hotels Group spent $400,000 to change 250,000 light bulbs and saved over $1.2 million a year – a four-month payback and a reduction of 27,681,257 pounds of greenhouse gases annually! Another simple success story is found in Macy’s Department store. They replaced all their halogen spotlight bulbs with LED spotlights that operated on 65W less electricity. After replacing 1.5 million bulbs with LED lights at a cost of $82.5 million, they will realize a one- to eight-year payback and nearly $620 million in savings over the next 12 years! It may seem like a lot of work being green, but the benefits (and the dollars!) are there, so go for it!
Invest time. Make it a priority to do your inventory. Invest in your people; train them about the green revolution and how it will make your company stronger. Create incentives for ideas to reduce waste. Reward drivers for getting good fuel economy. Take advantage of the “Prius Effect.” When drivers see the gauges that show efficient operation, they work at creating good fuel economy. Share your energy bills and improvements to encourage and motivate employees to reduce energy consumption. (Even make it part of their performance review.) Use timers and motion detectors, set back thermostats to reduce energy costs. Employ automated computer programs that turn off computers when they’re not in use; they are readily available. These investments will go a long way to the bottom line.
Another alternative: Hire an outside firm to do an energy audit of your building. There are companies that specialize in identifying waste and providing energy solutions. Lighting, building insulation, air and duct leakage improvements will rapidly make their way to improve your cash flow situation.
Tax Deductions for Commercial Buildings
Don’t think you have to do this alone. The government has incentives available to help out on the energy improvement front.
A tax deduction of up to $1.80 per square foot is available for energy improvements that result in energy savings of at least 50 percent and brings the building up to ASHRAE Standard 90.1-2001.
Partial deductions of up to $.60 per square foot can be taken for measures affecting building envelope, lighting, heating and cooling systems for systems installed by Dec. 31, 2013.
Federal tax incentives include:
Business Energy Investment tax credit
30 percent incentive for wind and solar energy systems placed in service before Dec. 31, 2016
MACRS (Modified Accelerated Cost-Recovery System) + Bonus Depreciation
Five-year depreciation schedule
50 percent deduction in 2008 and 2009, balance over ordinary depreciation schedule
State grants include the Community Renewable Energy Program.
Now for the four “R”s.
Reduce is straightforward – stop using so much stuff. Reduce your energy consumption, reduce your travel expenses, work four 10-hour days, telecommute, get creative. Stop printing out so much paper and ink; go electronic. Get your employees involved. They are the front line, the infantry in the war on waste. They can best determine where they can use less.
Reuse is straightforward too; stop throwing so much stuff away. Reuse packaging, work with your suppliers to develop returnable, reusable containers. Shouldn’t they be a part of the green war too?
Get creative, find ways to reuse fasteners, steel, pallets, wood, barrels, boxes, paper, and computers; refill ink/toner cartridges. Instill in your employees the desire to save not only the environment, but your business – their livelihood!
Recycling on the surface may seem to be nonvalue-added effort. Separating trash and having to store recyclables feels like wasted time, but once again you need to be creative. Scrap copper, steel and aluminum can all be sold. Most of the time, recyclers will pay for your waste oil. Putting less paper, aluminum and cardboard in your trash means less frequent dumps or smaller size dumpsters and more money in your pocket. Recycling can work if you work at it.
Renewable energy is the wave of the future. Current payback times can range from 10 to 20 years depending on what type or design of renewable energy system you choose. Solar PV panels have dropped in price by 50 percent over the last several years and are predicted to drop even more over the next 12 months. There are lots of grants and incentives that can make the payback times even less. While the purchase of renewable energy systems seems risky right now, when oil, natural gas and electricity prices skyrocket again you’ll look like a genius for investing in free energy. To get the most benefit from this technology you need to reduce your electricity bill. Look at efficient lighting and appliances to enable you to reduce the cost of a renewable energy system and improve your payback time.
Where do you start to develop your green business initiative? Stop procrastinating, get engaged, get your people engaged, and develop a green business plan. Give it serious attention. This can differentiate you from the rest of the pack. A plan to take advantage of the green economy will give you the edge you need to come out of this downturn ahead of your competitors.
Identify – do your inventory, consider hiring an energy consultant to do an energy audit on your building and reduce your operating overhead by reducing your monthly payments for energy. Improve – take immediate action. Start shutting off lights, etc. Invest – start with investing the time and explore all your opportunities (including government incentives), then invest in technology and products that will improve your bottom line.
Reduce, reuse, recycle, and renew. Put it into practice and drive it down into the company; every person needs to take personal responsibility. Every person needs ownership in the process to make your company lean and green.
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