Well it’s been an exciting and busy year – can’t believe it’s nearly over. We hope that everyone has a great and relaxing holiday and we will be back fresh and ready to provide more useful energy cost saving insights in the new year.
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This was devised to address issues such as climate change, waste water management and rising customer bills. As we have mentioned in previous blogs, we are under threat of water scarcity and have to take water management seriously. Included in the White Paper are a number of proposed measures to encourage people to use less water. For instance, a range of hot water technologies could be included in the government’s flagship energy efficiency Green Deal scheme. The scheme, which is due to launch in autumn 2012, allows businesses, landlords, and homeowners to install packages of energy saving technologies such as insulation at no upfront cost, repaying the loan through a surcharge on energy bills over 25 years. However, the level of repayment must be smaller than the savings realised by the energy-saving measurements; thus the improvements will pay for themselves. However, experts have suggested the changes will lead to increased water bills as water companies pass on the costs of upgrades and government compensation schemes that allow abstraction licences to be changed. What are your views? Is this welcome news? Ofwat, the economic regulator of the water and sewerage sector in England and Wales, has published a consultation on how it will set price limits in future. Every five years, Ofwat sets price limits for the water and sewerage companies to ensure that customer bills do not increase by more than is necessary. As water is a monopoly business*, customers cannot choose their supplier, therefore price limits protect the end consumer. Between price reviews, price limits may have to be adjusted if circumstances change. For instance, as we reach the end of the first stage of the 2009 water industry price review, it has become apparent that circumstances have vastly changed – we are now more aware of the threat of water scarcity, increasing population and the impact of climate change – hence the need for a review. Following the consultation, Ofwat will publish a decision statement in spring 2012, setting out the principles it will use to set price limits. This will be followed in autumn 2012 by a more detailed consultation on the methodology used for the next price review process. To read the consultation document in more detail visit www.ofwat.gov.uk *The Water Industry Act 1991 is currently being reviewed and it is hoped that by the end of the year businesses in England and Wales will be able to choose their supplier. A recent report from the Carbon Disclosure Project, an independent not-for-profit organisation holding the largest database of primary corporate climate change information in the world, highlights how corporations already facing water-related disruptions are failing to deal with water risk. The research showed that out of 190 publicly listed companies, only 57% had water strategies and policies in place, despite many already having already experienced water-related business impacts and others identifying risks to their direct operations and supply chains over the next five years. As we reported in a previous blog, water scarcity is a serious issue. Implementing a water management strategy isn’t just a risk management issue but it will also reduce water costs, thus saving organisations money. Call us on 0141 226 8525 or email info@businesscostconsultants.co.uk to find out more about how to reduce your business water costs. The Environment Minister, Richard Benyon, has announced that around 24K businesses across England will be able to choose their water supplier under new reforms soon to be implemented. At present, only businesses that use more than 50 megalitres of water a year can switch from their existing water supplier to a new one (to put this into perspective, 50 megalitres is equivalent to 20 Olympic-size swimming pools). This means that just over 2K businesses are currently able to choose. Under the new reforms, this threshold will be lowered to just five megalitres increasing the number of businesses that can choose to around 24K. Scotland’s non-domestic water market was deregulated by the Water Industry Commission for Scotland in April 2008 when Scottish Water’s retail subsidiary Business Stream separated from its parent company. Since 2008 we have seen real benefits for businesses such as a reduction in costs and better services for those who have switched, thus demonstrating the effectiveness of deregulation. Furthermore, the separation of the retail division from Scottish Water has helped identify inefficiencies within the network systems allowing for improvements to be made. All of this bodes well for businesses in England and Wales who want to drive down costs and receive better levels of service. The change, which is subject to Parliamentary approval, is an amendment to the Water Industry Act 1991 and it is hoped that this will be in place by the end of the year. Other recommendations of the Cave review that are being considered for inclusion in the Water White Paper: What is the ECA water scheme? The Enhanced Capital Allowance (ECA) scheme offers organisations a 100 per cent first-year allowance for investment in specific water efficient plant and machinery. Organisations can write off 100 per cent of the cost of plant and machinery which is included in the scheme against taxable profits in the first year of purchase. The ECA water scheme is managed by the Department for Environment, Food and Rural Affairs (Defra) and HM Revenue and Customs, in partnership with AEA Technology, who manage the scheme on behalf of Defra. The purpose of the scheme is to help organisations reduce water consumption and make financial savings. What technologies are included? Technologies such as monitoring and control equipment, efficient taps and showers, leakage detection equipment, rainwater harvesting equipment and industrial cleaning equipment are included. All products included in the scheme can be found on the Water Technology List (WTL). How do I know if I’m eligible to claim? If you are the end purchaser, i.e. you are using the product directly for your business, then you can claim under the scheme. Organisations that are not entitled to tax relief (local authorities, schools and non-profit organisations) and organisations that are buying the product to sell on to someone else won’t be eligible for the scheme. How will it benefit you? By investing in WTL products and devising a water management strategy, facilities managers and energy managers can reduce water consumption, saving thousands of pounds, as well as reduce their organisations environmental impact. To find out more about the scheme visit www.eca-water.gov.uk Email info@businesscostconsultants.co.uk to find out more about water management and gain advice on water efficient technologies or visit our main website at http://www.businesscostconsultants.co.uk/cheaper-water.shtml Many organisations are looking to reduce their water consumption for environmental reasons and to reduce costs. Water consumption reduction is a great way to reduce costs, but there are other things that can be done to lower costs. For instance, many companies don’t even realise that they are being overcharged for water services, especially surface water drainage. We personally have taken on clients that were paying over the odds and had to recoup thousands of pounds from water companies over the years. We would advise all organisations to carry out (or ask an expert) to carry out a full investigation of costs and claim any potential rebates back from water companies. It isn’t an easy process trying to recoup these costs, but it could be worth it. If you spend thousands on water costs you could recoup thousands back. The money should be pumped back into your business, not the water company. Some things to think about when auditing you historic bills include: Water is often thought of as a low cost and infinite resource, but it can be one of the most expensive raw materials, especially in industries such as manufacturing. By taking action and developing strategies to reduce consumption, organisations can reduce costs by up to 50%. Furthermore, water conservation can contribute to reducing energy bills associated with heating and pumping as well improving overall efficiency. Throughout our blog we have given many tips such as: • Checking you have the correct sized water meter Before you take any measures though to reduce water consumption, it is essential that you conduct a water audit for your organisation. This will help with compliance with current and future legislation as well as identifying areas for cost savings and any discrepancies such as water leaks or overcharges. Depending on the type of organisation will depend on the level of expertise required to carry out a full water audit – for instance water use in breweries and manufacturing plants will be more complex than in a commercial office building. Water specialists will be able to complete an audit quickly (allowing onsite staff to focus on other areas of their business) as well as provide the experience and information to help benchmark the site against other similar sites that they have provided audits/services for. A well-performed audit will outline where you get your water from, how much is used, where it is used and what is used for and where the water ends goes to. If you have an expert onsite to help you can characterize each of the identified streams by flowrate, type, concentrations, and variability of the substances and compounds to help devise a strategy for recycling and reusing water. In general, regardless of what industry you are in there are some key things you will need to conduct a thorough audit including: • water and sewerage bills for the past two years If you want to conduct an audit internally you should speak to your local water company about how they can help. It is important to remember though that they won’t want you to identify errors on bills or overcharges, therefore doing an independent audit is advised. Furthermore, it is important to consider hidden costs (associated chemical, energy or maintenance costs) of water consumption and the time that it will take you to complete an audit in-house.
Given that the UK brewing industry uses a vast amount of water, most of which ends up as trade effluent, there is an increase in the number of breweries looking to implement water management strategies. We have seen organisations save over 70% on water consumption by implementing a water management strategy. Yes, this is unlikely for everyone, but most organisations can save at least 20% through a water management programme. Something to consider in the water management strategy is removing all pollutants from the effluent stream so that the water can be safely recycled back into brewery operations. This action can lead to a 50% in the volume of water that needs to be brought on site and can potentially reduce the water ratio to 2,2 hl:hl. It is also important to consider installing submeters and carrying out water consumption surveys to identify areas in which savings can be made. Furthermore, you should take steps to identify leaks, stop overflows and optimise cleaning procedures to make significant savings. If the amount of water used is more than 3.4 times the volume of beer brewed over the same period then you need to take steps to reduce water use. Similarly, if the average chemical oxygen demand of your effluent is more then 2K mg/litre you should implement a water management strategy. If you have any queries about implementing a water management strategy call 0141 226 8525 or email info@businesscostconsultants.co.uk See our main website at www.businesscostconsultants.co.uk
If you don’t keep an evidence pack, or it is incomplete, you may be fined. The maximum financial penalty is £40 for each tonne of CO2 that you reported in your most recent annual submission. However, collating the pack is an immense administrative burden and also uses up resources that could have been better utilised elsewhere – perhaps on green initiatives. It is critical though to avoid steep fines. We have also seen numerous guides out there on collating the pack – but is this overload of ever-changing information just making the whole process more confusing? How are you getting on with your evidence pack? CRC Evidence Pack – what it should contain (pdf) If you need any assistance with your CRC management or have any CRC queries e-mail info@businesscostconsultants.co.uk or call 0141 226 8525. |
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