As companies re-open and work towards the new normal, business owners are looking to claw back trade and much-needed revenue, they’re also taking stock and examining how to save costs in a post-Covid business environment.
Cutting energy costs is probably one of the easiest ways for a business to save money. Investing in energy efficiency provides payback over the short, medium and long-term. And with the range of grants and supports available from the Sustainable Energy Authority of Ireland (SEAI), it makes sense to make that investment sooner rather than later.
From grants for renewable heating systems to supports for specific energy-savings projects – there is an array of incentives available that may ease the transition to sustainability.
All the initiatives are currently open to applicants, apart from the SEAI’s EXEED grant scheme, which is now closed for 2020 – but is worth keeping an eye on for energy investment plans in the future. This scheme is worth up to €500,000 a year.
- Support Scheme for Renewable Heat
Are you looking for new ways to heat your premises? If you are, it is worthwhile checking out the Support Scheme for Renewable Heat. Government-funded and administered by SEAI, the scheme is open to commercial, industrial, agricultural, district heating, public sector and other non-domestic heat users.
It supports the installation of ground, air and water source electric heat pumps with grant aid up to 30% of the capital outlay. It also supports businesses and farms for up to 15 years for the installation and on-going use of biomass and anaerobic digestion heating systems.
You can find out the full details of this scheme including the tariff levels, terms and conditions and how to apply on SEAI's website.
- Accelerated Capital Allowance (ACA) scheme
If you’re investing in new capital plant and machinery, why not see if you qualify for the Accelerated Capital Allowance Scheme? This is available to sole traders, farmers or any companies paying corporation tax in Ireland. Under this scheme, businesses can write off 100% of the purchase value of qualifying energy efficient equipment against their profit in the year of purchase.
The scheme is based on the long-standing “wear and tear allowance” for investment in capital plant and machinery, whereby capital depreciation can be compensated through a reduction in an organisation’s tax liability.
For cars falling into the category “electric and alternative fuel vehicles”, the accelerated allowance is based on the actual cost of the vehicle or €24,000 – whichever is lower. Ask your tax adviser or visit revenue.ie to see if you qualify for an ACA.
- Energy efficiency obligation scheme
Are you planning an energy-saving project? Under the Energy Efficiency Obligation Scheme, energy suppliers must support energy efficiency projects in businesses across Ireland.
Companies who sell large amounts of energy are known as obligated parties and they have targets under the scheme. Obligated parties offer supports to make your business more energy efficient. For every unit of energy saved through these projects, they achieve energy credits towards their targets. Essentially, it’s a win-win for both parties.
See Energy Efficiency Obligation Scheme for more details.
- Project Assistance Grants
If you are spending over €250,000 a year on your energy bills, this grant may help you to develop projects to cut your energy consumption and costs. It’s open to businesses and public sector bodies who are seeking to develop energy-saving projects whose aim is to achieve significant energy savings and build good procurement practices.
There are a number of stages:
- Early expert advice – SEAI provides early expert advice at the project concept stage.
- Feasibility study - A feasibility study will help to evaluate energy saving opportunities further. At the end of this stage, you can decide if a project is suitable to your organisation. Up to 50% funding is available up to a maximum of €15,000 at this stage depending on the size of your energy bill.
- Final business case and project delivery support - This enables organisations to engage external resources to develop projects further. This can received up to 75% funding to a maximum of €15,000 where basic energy performance arrangements are considered and up to €37,500 where energy performance contracting (EPC) is considered at this stage.
- Pay for performance – SEAI offers more support for projects that incorporate pay for performance arrangements. There are two levels of pay for performance:
- Basic energy performance arrangements
- Energy performance contracting (EPC)
See Project Assistance Grants for more details.
5. Energy contracting
This is where your company can share performance risk in your energy projects while making cost savings, and reducing your carbon emissions.
Energy contracts can help your business to achieve significant savings in energy, money and carbon emissions at reduced risk and with a variety of financing options.
Energy contracting is a “pay for performance” approach to installing and operating energy technologies in your business. The option you choose influences the level of energy and cost savings guaranteed, ranging from a simple ccontractual guarantee making a portion of payment conditional on performance to more complex arrangements where third parties take full performance and finance risk of the energy project but on the basis of having future savings as a revenue stream.
See energy contracting to find out more. Supporting information at SEAI's website.
Other cost savings
Apart from the SEAI grants and incentives that will help you make significant energy savings, you should also contact Electric Ireland to find out if any of its range of tailored energy products might help you cut costs as you reassess your energy needs in a much changed business environment.