Knowledge is power
February 1st 2009 The technology to save energy and money is out there, but Tim McManan-Smith says warehouse operators are being short changed by lack of information and encouragement
There is a wealth of technology that can save energy in all areas of the warehouse, primarily: Lighting; HVAC; heat loss; forklifts and battery charging. Director general of the new Department of Energy and Climate Change, Willy Rickett, has stated that energy efficiency is the top priority with regard to all of the UK’s energy ambitions. This may be true but is there enough of an incentive to make it reality? The Carbon Trust offers interest-free loans and enhanced capital allowances to drive uptake of energy efficient technology. Although these offer some encouragement, ECAs have been criticised for being administratively too onerous.
The Carbon Trust has been accused of focusing on big business and large scale demonstration projects such as carbon capture and storage for coal-fired power stations, where the wins are easier. Edward Leigh MP, chairman of the Committee of Public Accounts, said last summer that: “The UK government has a target for reducing carbon dioxide emissions by 118 million tonnes a year on 1990 levels by the year 2010. The Carbon Trust is on track to meet its own 2010 target but that is an annual reduction in emissions of only 4.4 million tonnes. The Trust’s contribution is pretty small beer...a lot of businesses, especially smaller ones, are yet to be convinced that improving their energy efficiency makes commercial sense. The Carbon Trust must provide evidence to the contrary and also aim to assist more eligible small businesses under its interest free loan incentive scheme.”
Paul Potter, principal analyst at Utility Forum agrees. “Very few firms [in the warehousing sector] take up the ECAs or loans. Probably about 30-40 per cent of our portfolio use the loans or ECAs. But that’s because we promote [the loans/ECAs] and help customers through the process: We have been accredited with the Carbon Trust for five years and have a good relationship with it. But generally, in the national context, the percentage is very small. Many firms have never even heard of ECAs/loans and are fearful of the application process. It’s the British mentality: you don’t get something for nothing.”
Actually he is right, you don’t. “The Carbon Trust gets its funding is from central Government and it’s money that firms have already paid on the Climate Change Levy – so they should claim it back. And we can help,” Paul Potter continues.
He thinks that the Carbon Trust is not good at promoting itself and hasn’t done enough marketing to tell people what they need to know and how it can help. [Maybe the advertisement opposite may go some way towards addressing this – Ed]. “We’ve done 600 audits for Carbon Trust and we have sourced 95 per cent of those ourselves by calling up firms and pitching the idea.”
But, says Paul Potter, the simplest way to offset the credit crunch is to reduce overheads, and by using interest free loans cashflow can actually be realised from day one.
There are also other ways to finance energy saving projects: Many contract energy management companies offer to pay for facilities improvements and share the savings between themselves and the customer over a specified contract length.
Funding aside, what are the options?
Regardless of funding, technologies that afford rapid, demonstrable ROI and reduce overheads thereafter are the cornerstone of any successful business. So what are the promising new warehouse technologies making their manufacturers money by promising to save cutomers theirs?
Most obvious in terms of forklifts is Still’s Blue-Q technology, which the firm claims achieves 10-20% energy reduction depending on the application: When the operator presses the Blue-Q button, the truck’s drive characteristics are intelligently optimised, apparently, and all unneccessary electronic components are switched off. Compared to a standard 1.6t electric truck, Still reckons Blue-Q could save approximately €2500 over a 5 year, three-shift operation based on energy savings alone.
With electic forklifts come batteries and chargers – another big cost. Responding to a Handling & Storage Solutions survey of UK Warehouse Association Members regarding energy usage, Steve Potter, operations director at Bibby Distribution, says the firm has made significant inroads in terms of reducing battery-related energy costs. “In many of our warehouses we have deployed a combination of Chloride batteries and Hoppecke charging systems,” he says. “The system is designed to either shut off or reduce charging to a small trickle, designed to keep the battery at optimum charge. The older designs relied on a timer circuit to cut the charging after a predetermined period. The claimed energy savings are at least 10 per cent.”
Almost all of the HSS survey respondants had made measures to improve lighting efficiency – unsurprising given that up to 60% of the warehouse electricity bill can be down to lighting. Steven Potter says Bibby, after working with energy consultants, Utility Forum, to find the most appropriate solution, has invested £100,000 – 150,000 per depot on more efficient lighting, with a predicted payback of around 18 months. So far Bibby has upgraded two larger DCs with two more in progress, and further projects planned.
However, before making any misinformed decisions, it is essential to check out what new technology exists. In terms of warehouses, The Carbon Trust’s guides The Lighting of Warehouses and Storage Areas and Managing energy in warehouses are 2003 and 2002 respectively. Six year old technology will deliver scant savings. “We couldn’t have undertaken the lighting project three years ago, now we can,” says Steven Potter. “The technology and the savings are available.”
There are numerous other ways of reducing utility costs (such as evaporative cooling to deliver less energy intensive HVAC, rapid roller doors to prevent heat loss, and the basics such as forklift fleet optimisation) as outlined in the rest of this supplement. And the information, for those prepared to look, is out there. But the question is, how badly do warehouse operators need to reduce overall costs? Time may tell. And, unfortunately for some, there’s no time like the present.
Tim McManan-Smith is editor of Water, Energy & Environment, and group editor of Western Business Publishing | 
