The Impact of Energy Costs on Business Profitability – GWC Mag

Let’s talk energy costs. For escalating electricity expenses are being felt with every monthly utility bill. Thereby leaving businesses grappling with the critical issue of finding a solution to rein in energy costs. All the while maintaining customer and employee comfort. The price of energy is also more than just a line item on a balance sheet. For it’s an important factor that can substantially impact an organization’s profitability and sustainability.

 

This begs the question: How can businesses find a way to strike the ideal balance. Especially between cost savings and ensuring the comfort of those they serve?

The answer lies in advanced energy management strategies. For at the heart of this approach is the concept of demand response. More than just a buzzword; demand response is a dynamic solution. One that empowers businesses to optimize their energy usage, reduce costs and contribute to a more sustainable future.

Understanding the Challenge: The Impact of Rising Energy Costs

Energy costs have been steadily climbing in recent years. Thereby affecting businesses of all sizes across all industries. These expenses can quickly eat into profit margins, compelling organizations to seek cost-saving measures. However, cutting costs without careful consideration can lead to energy management solutions that result in higher temperature set points causing discomfort for customers and employees alike.

For businesses, customer and employee comfort is non-negotiable. A pleasant environment enhances productivity, customer satisfaction and overall well-being. Yet, with rising power prices and more extreme weather, finding a happy medium between comfort and cost savings has become an increasingly complex challenge.

This is where a customer-centric approach to demand response emerges as a versatile, convenient and effective solution. By taking building operations into account, thoughtfully implemented demand response allows businesses to seamlessly adapt their energy consumption in response to periods of peak demand, all while preserving the comfort that is fundamental to productivity, customer satisfaction and the comfort of both customers and employees. Demand response provides a user-friendly means to navigate the constant shifts of energy management, making it a valuable tool for organizations seeking to thrive in an increasingly sustainable and cost-conscious world.

Demand Response 101

At its core, demand response involves temporarily adjusting electricity consumption based on the supply-demand dynamics of the grid– empowering organizations to optimize their energy usage and play a significant role in creating a more sustainable business.

When the grid experiences high demand or potential supply constraints, demand response programs kick in. Businesses voluntarily reduce their electricity consumption during peak periods. In return, they receive financial incentives, contribute to crucial ESG objectives by reducing greenhouse gas emissions, enhance grid reliability and reduce energy costs by avoiding peak prices. This approach benefits both the organization and the grid, ensuring a stable energy supply when it’s needed most.

Tailored Demand Response Solutions for Businesses

One of the standout features of demand response is its adaptability. It can be tailored to meet the unique needs of various industries, including retail, commercial, manufacturing, and more. Each sector has distinct energy usage patterns, and demand response providers specialize in creating solutions that align with the unique needs of each industry or business.

For instance, grocery stores can effectively manage their energy usage by adjusting HVAC, freezers and chillers a few degrees while keeping food in the fresh and safe zone—and manufacturers can optimize their energy-intensive processes by pausing or reducing production or packaging lines. Commercial facilities can adjust HVAC setpoints while maintaining employee comfort through demand response program participation.

Demand response providers bring expertise to the table with an understanding of the nuances of different industries and design solutions that maximize savings without compromising comfort. Having a trusted and experienced provider is invaluable in navigating the world of this valuable energy management tool.

Ensuring Customer and Employee Comfort

The key to successful implementation is ensuring that customer and employee comfort remains intact—which is achieved through advanced control systems. These technologies enable businesses to make smart decisions about when and how to curtail energy use.

Predictive analytics, for example, can anticipate peak demand times and allow for precooling the facility. This ensures that the temperature remains within acceptable ranges for occupants. Energy-saving specifications can be so minimal that customers and employees won’t even notice the subtle adjustments happening behind the scenes.

Conclusion

Businesses must find sustainable solutions that factor in both cost and comfort. Demand response is a seamless tool to leverage in this pursuit, offering a win-win scenario where entities subsequently reduce expenses, support grid stability and contribute to a greener future.

Organizations looking to implement efficient energy management and sustainable practices should explore demand response solutions tailored to their specific needs. With providers like Enersponse offering expertise and cutting-edge technology, managing energy budgets without compromising comfort is not only achievable but also a step towards a brighter, more sustainable future.

About the Author:

Rachel Permut brings more than 20 years of career experience in business strategy, M&A and product development to her role as Enersponse’s chief strategy officer. Prior to joining Enersponse, she developed new customer offerings in microgrids and eMobility for ENGIE North America and led channel sales for ENGIE Storage. Prior to ENGIE, Permut held various roles with Duke Energy across the company’s regulated and commercial businesses.

By: Rachel Permut, Chief Strategy Officer at Enersponse