Energy efficiency and saving money

Energy is the third largest cost for most food or beverage manufacturers, after materials and labour. Energy is easier to manage.

You can optimise your energy use without harming your business through:

  • efficiency
  • monitoring
  • timing your loads to manage peak demand and coincide with lower energy tariffs.

As energy costs increase, investing time in reducing energy use will prove worthwhile.

Reasons for and costs of energy in your business 

All businesses differ in how they use energy. Your business energy costs depend on: 

  • how much energy you use
  • whether you use electricity, natural gas, or another form of energy
  • when you use energy.

You should review your energy costs regularly, even if only to check that you’re on the best tariff.

A useful way of tracking your energy savings progress is by working out the cost of energy you use compared to what you produce. You can do this by dividing your energy costs by the volume of your product. 

For example, if your energy bill is $100,000 and you produce 700 tonnes of product, your energy costs you $143 per tonne of product ($100,000 divided by 700 tonnes = $143 per tonne).

Many services powered by gas or other fuels can now be electrified, which is a first step towards decarbonisation. 

These graphs show samples of how small food or beverage manufacturing businesses use energy and where there might be savings opportunities.

This graph shows an example of how the energy use of a small to medium food or beverage manufacturing businesses breaks down between different energy types. It is a pie chart.  The sections of the chart are labelled electricity 58%, other 42%.
This graph shows an example of how the energy use of a small to medium food or beverage manufacturing business breaks down between different activities. It is a pie chart.  The sections of the chart are labelled production 48%, refrigeration 25%, packaging 16%, lighting 6%, other 5%.

Measuring and valuing energy

The easiest way to understand your energy use and costs is through your bills. However, they probably don’t show when you used energy or what you used it on. 

There are metering and monitoring tools available to give you that data in real time. Sub-metering can be easily ‘clipped on’ to a particular process or piece of equipment to tell you how much energy it is using. These tools can generate reports and highlight irregularities which help to identify equipment which is operating inefficiently or needs maintenance.

You can apply for an Energy Efficient Communities Food and Beverage Manufacturing Business (EEC) grant to purchase, hire and install energy meters, or to digitally connect energy meters and process sensors. 

Energy audits

An energy audit can give you immediate savings through:

  • reviewing the energy tariffs you pay
  • identifying equipment maintenance needs
  • identifying potential low-cost interventions.

The audit might compare your business against similar businesses. It should provide you with an action plan, prioritise tasks according to impact, and show you the costs and benefits. 

The plan might also include suggestions for:

  • on-site generation and storage
  • demand management
  • use of waste
  • decarbonisation. 

Audits are of most value when they are based on good quality data, so before you start, consider improving how you measure your energy. At the very least you’ll need to locate your energy bills from the last full year.

You can apply for an EEC grant to carry out an energy audit at your food and beverage manufacturing business.

What kind of audit is right for me?

The standard defines three audit types: 

  • Type 1 (basic) and Type 2 (detailed) - Can be done using the energy data most sites will have handy. Should suit most small to medium manufacturers.
  • Type 3 (precision) -  Provides a very detailed analysis of a sub-system and might be useful if you’re considering a large investment to upgrade an unusual or complex system. Likely to require additional temporary metering and sub-metering equipment. 

The cost of an energy audit will depend on the kind and size of your business, how much energy you use and what for, and the quality of data you have about your energy use. As with any business decision, it makes sense to research options and get competitive quotes. An independent expert audit, to the Australian Standard, is likely to cost $5,000 to $10,000 depending on the complexity of your business and the type of audit.

Remember, the minimum grant size for the Energy Efficient Communities Food and Beverage manufacturing business grants is $10,000.  So if you are applying for a grant to fund an energy audit that costs less than $10,000, you will need to include other eligible expenditure items in your application to reach the minimum grant size.

Switches and wiring on a controls board

Switches and wiring on a controls board.

Opportunities for improvement

You can apply for an EEC grant to carry out these activities, except for the ones noted as not eligible:

  • review your tariffs, consumption and bills (not eligible for EEC grant)
  • carry out routine equipment maintenance including seals, filters, settings (not eligible for EEC grant)
  • install or upgrade metering 
  • implement a monitoring program 
  • commission an energy audit  
  • check your electricity distribution board and modernise if required
  • install power factor correction or voltage optimisation equipment. 

Small businesses can use the Small Business Energy Check to compare their energy spend with similar businesses in the same sector and region. Small businesses in NSW, QLD, SA, TAS and ACT can also compare energy plans from different retailers at Energy Made Easy.

If you’ve got a sense of your position and you’ve captured the easiest opportunities you might:

  • install or replace a component to help an existing system run more efficiently
  • replace existing equipment with more efficient equipment
  • reconfigure a process to optimise energy use.