9 ways to beat high heating costs this winter

Rising heating costs will have a major impact on facility operations and there is no immediate end in sight. High prices may decline later in winter if it is severe. If there is high demand, prices may drop, but not until after January 1 and more likely after the first quarter.

Any FM (facilities manager) who set the price of gasoline at least a year ago is a hero, but heroes are rare. Most companies have six-month to one-year purchase contracts and wait until the start of the heating contract, or mid-summer, to buy. Unfortunately, prices started to rise early in the second quarter of this year. If they have committed to buying a minimum amount of gasoline, they are stuck and must take that load.

Stuck, however, doesn’t necessarily mean helpless. There are still steps facilities managers can take to stay within their heating budget this year, and other actions they can take to lower their costs in the future.

1) Know what the facility uses

The first step in reducing utility bills is to become an informed consumer. Once FMs have the tools to monitor and compare their facilities’ utility usage, they will be in a better position to negotiate rates, adjust business operations, or repair faulty equipment. Putting these tools in place can instantly save a business five percent or more on its utility bills.

Energy management software can detect facility operations that trigger unnecessary excessive demands, such as all elevators running at once. However, in addition to monitoring power usage, you can forecast loads so operations can be changed before power spikes occur. The software can be used to adjust equipment scheduling, adjust set points at peak demands, and, in extreme times, reschedule business tasks.

The software is particularly useful for multi-site businesses as it helps account managers focus on the equipment or operations that need maintenance the most to increase efficiency, reduce maintenance and downtime, and maximize staffing and resources. budget. Even if you’re paying more for energy, it’s important to get the most out of it and keep your business running smoothly.

2) Have an expert review the invoice

Companies say, ‘We need this or that device to control the amount of energy we use.’ I’m not saying that hardware isn’t necessary, but unless you strategically examine all of your energy spending, a year’s business needs, and your goals for how to spend the money on energy, you won’t have a blanket solution. Ask the customer to take a step back and look at their energy use from a higher level to come up with a strategic energy plan that is tailored to their business.

The place to start is simply by collecting monthly utility data and information about the site or sites. Then a power plan skeleton can be created and developed with things like the company’s rate class. Often times, companies have a contract fee or pay for a base claim that they don’t know they are paying for. Your contract may call for a minimum monthly purchase of 200 kilowatts, and we found that they haven’t used 200 kilowatts in months. Or they have a contract based on a load factor that they just don’t have. So we found a rate that could save you 10 to 20 percent. These are solutions that can be found quickly and generate savings for years.

The next step is to review historical billing data for utility company errors to obtain customer refunds. Because of the number of clients utility companies have, they make tons of mistakes. Once the facility has an advantageous tariff rate and billing errors have been detected, a monitoring program is essential. Fare structures and rates may change. The facility can also make an advantageous change in the shape of your cargo. These possible changes make the energy plan a living document.

Having historical billing, rates and energy usage information puts energy customers in an incredible bargaining position, especially in a deregulated market where they can get a much better price. They can also get an agreement that includes operational and risk requirements that are much better suited to their facility.

3) Take advantage of deregulation

Combining electricity with natural gas purchases is another way for FMs to lower their utility costs. It can help to set a lower and flatter price because the customer is committing a larger part of the purchase of their utilities to a single provider. In return, the utility company can provide protection against price fluctuations above a specific limit set in the contract.

You will see more power packs in the long run. However, it will be a few years before there are more options from the energy companies that supply both. Natural gas is nationally deregulated and a familiar commodity game, while electricity choices depend on state regulations and facility managers can make better decisions about purchasing both commodities to protect themselves from fluctuations.

4) Buy gas at a fixed rate

If the price of oil is significantly higher, people will see higher prices no matter what. The most important thing that energy users can do to avoid price fluctuations, with natural gas prices higher than ever, is to set a fixed rate for 6 or 12 months.

With a little pre-planning, FMs can lock in costs so they’re not exposed to unexpected surges. You are blocking certainty. You won’t get a minimum price, but you can protect your business from unexplained hikes.

An energy services company (ESCO) should be able to provide a competitive analysis with recommendations, showing the effects on the energy budget of going to market versus setting a price. Just before the heating season starts is not a good time to stay because prices are higher at that time. After the winter swell it’s better.

5) Get help

Whether FMs buy fuel at a fixed price or use the market, few understand and follow the energy industry well enough to get the best energy deals without the help of an expert. Events as varied as hot weather, a Middle East peace conference, or the promise of plunging into the strategic oil reserve can impact far-reaching contract decisions.

There are too many variables and no solutions. Energy consultants can find the best solution for each individual customer, in terms of market, month, week, type of customer, and their load characteristics.

FMs may not be sophisticated enough to trade the markets 18 months from now. It will take moments like this to prepare you for the future. We do not deny that there are some who may lock in a low rate well in advance, but less than 10 percent watch the market closely and understand the future game well enough to make buying decisions 18 months in advance.

6) Consider alternative options

Under deregulation, FMs may want to generate their own electricity when prices skyrocket, the company pays companies to remove the load, or the company offers an interruptible charging rate. FMs can partner with a power company that can not only generate electricity on site, but can also sell the thermal load from that generation at a reduced rate. Heating oil inventories remain more than 15 percent below 2009, but oil is not the only game in town. Facilities can improve their charging characteristics by using a combination of fuels. A facility that currently relies on electric heating, for example, might consider installing natural gas compressors. Using more gas could improve your gas charging profile, lower gas costs, and lower your electric bill.

7) Know the complete energy panorama of the installation.

We suggest looking beyond your heating bill to find savings. You have energy expenses that include oil, gas, electricity, utility, and upcoming capital maintenance that could include energy efficient equipment. If they are still individual pieces, the facilities manager does not take advantage of the real opportunities. Look at all the pieces and combine them.

For example, ESCOs may offer a percentage discount on the facility’s heating and electricity bill if the FM offers a contract to make the facility more energy efficient. Power can also be delivered at a deeply discounted rate under a shared savings contract, finance package, or BTU contract.

8) Tune up facility systems

While negotiating, FMs can discuss operations and infrastructure with their ESCOs. From an annual perspective, they should consider the demand-side measures that can be implemented. Many ESCOs and architects have internal and external partners ready to provide HVAC upgrades and services as needed.

Mechanical service may include cleaning ducts and filters, installing high-efficiency motors, and checking the configuration of air handlers and boilers. Computers and other equipment in offices generate heat, which can reduce the heating needs of those areas. Other options are to install heat recovery systems or preheat the incoming cold air. Brown recommends finding an ESCO that offers turnkey services ranging from facility improvements to financial solutions that reduce overall costs. You want an energy company that can do more than just provide energy. If you get the lowest price at the gas station, great, but if your car is tuned to use less gas, it will be even better.

9) Consume efficiently

We see facilities executives paying more attention to individual lighting controls, zoned air conditioning, and employee awareness. These days, managers ask employees to take their work and laptops home so the building can be idle after normal business hours. HVAC is rejected at six o’clock or charged to a cost center. Individual meters make departments more accountable. And lighting upgrades can include individual automatic controls to turn off lights when employees leave their cubicles, or slide switches that control the lights on each computer.

While some controls can be disabled or operating hours changed, most corporate facilities are unwilling to lower their temperature set points. Heating costs must be taken into account: we do not recommend energy savings that reduce comfort.