Businesses can save money with government LED lighting
Energy bills are starting to take their toll on Australian retailers. Lighting costs are one of the biggest energy consumers for retail businesses and has a significant impact on retailers overheads. Government agencies such as AEMC have predicted that energy prices will remain flat over the next 15 years, however, according to studies conducted by Industry.gov.au, energy consumption is expected to rise by 32% by the year 2020. These predicted ‘price hikes’ would cause a major blow to retailers operating profits over the next decade. Thankfully, a few of Australia’s state governments have taken bold actions to circumvent the predicted energy demands from the retail sector by offering LED lighting incentives that will reduce energy consumption costs and retailers impact on carbon emissions.
What dilemmas do retailers face?
For retail managers, energy efficient solutions need to be prioritised. According to historical figures provided by the AEMC, electricity prices have increased rapidly from 2007-2013, largely due to rising network costs. They have forecasted price rises that should remain fairly flat through until 2040, although this could easily change as the current wholesale price is low due to weak demand. A new trigger to demand could easily cause prices to spike.
Additionally, retailers may find that as energy demands increase, they will exceed their allowable consumption cap and will need to spend more to get more power.
The graph below shows the historical growth of energy price rises in Australia.
There is an urgency for retailers to switch to a more sustainable solution sooner rather than later.
What incentives are available for retailers?
Depending on which state your retail business operates in; your business will be eligible for the following incentives. LED lighting specialists LEDified can manage the application for retailers that want to take advantage of the schemes that are available in their state.
Incentive – The Victorian Energy Efficiency Target Scheme (VEET)
The Victorian Energy Efficiency Target (VEET) scheme was designed by the Victorian government to make energy efficient improvements more affordable and to allow businesses to contribute to the reduction of greenhouse gases. To be eligible for the scheme, your retail business must:
- Decommission high-energy lights including incandescent lamps and replace them with low energy lights.
- Apply for a Victorian Energy Efficiency Certificate (VEEC – Where 1 VEEC represents one tonne of carbon dioxide equivalent (CO2-e) to be reduced by the prescribed activity undertaken by the consumer.)
- That the installation is conducted by an accredited person to create a VEEC.
- That the benefit of the installation can be attributed to the VEEC. (For example, price reduction or a cash-back arrangement)
New South Wales
Incentive – New South Wales Energy Savings Scheme (NSS)
The New South Wales government provides financial incentives for retailers that invest in energy saving equipment. By working with Accredited Certificate Providers like LEDified, your retail business can benefit by upgrading to sustainable solutions at a marginal cost.
For retailers that operate in states that don’t have any schemes available, LEDified can do the installation for free.
Retail managers need to consider energy efficiency seriously.
Retailers can start saving on their operating costs over the short, medium and long-term by installing energy efficient lighting and taking advantage of the government incentives available. Some of the common excuses retail managers make for not going ahead with energy efficient lighting solutions include the following.
“I will wait for the lights to become cheaper.”
The fact is in 3 to 6 months; the return on investment tends to be higher than the price erosion that they are hoping for.
“I cannot afford it.”
With government incentives, there is a funding option available that will make things cashflow positive.
Retailers can use the calculator below to forecast savings to their operating costs.
Savings calculator: http://www.ledified.com.au/energy-calculator/
The government is ready to equip your retail premises for sustainability. Government lighting incentives are the perfect option for retailers that want to reduce their overheads through energy consumption. Those retailers who choose to implement LED lighting solutions can expect to see increases in their operating profit and to benefit from the cost savings over the long-term.