ABSA Energy Market Update & How to save $$$ November 2015 - PDF document

7/27/2016 ABSA Energy Market Update & How to save $$$ November 2015 Marc White 28 July 2016 AGENDA 1. Introduction 2. Market Update 3. Energy Efficiency 4. Risks & Caveat Emptor 5. Future Energy Landscape 6. Q & A Goanna Energy Consulting Pty Ltd 2 1

7/27/2016 What costs make up your Electricity Bill in 2016/17? Network = 51% + MRET = 8% Other = 3% Generation = 38% Goanna Energy Consulting Pty Ltd 3 What are the 5 largest Energy users in a school? = 30% Goanna Energy Consulting Pty Ltd 4 2

7/27/2016 OK What are the Top 5 energy users for schools without Pools? Heating = 61% Canteen/Staff Fridges = 10% Cooking, Computers Other = 9% Lighting = 20% Goanna Energy Consulting Pty Ltd 5 AGENDA 1. Introduction 2. Market Update 3. Energy Efficiency 4. Risks & Caveat Emptor 5. Future Energy Landscape 6. Q & A Goanna Energy Consulting Pty Ltd 6 3

7/27/2016 2016/17 TasNetworks Tariff TAS94 7% Goanna Energy Consulting Pty Ltd 7 2016/17 Tas Wholesale Every Small School (150MWh pa), means +$3,575 pa Every Large School (600MWh pa), means + $14,300 Goanna Energy Consulting Pty Ltd 8 4

7/27/2016 Tas Wholesale Goanna Energy Consulting Pty Ltd 9 Environmental Certificates (LGC’s) The current market sentiment for LGC’s is that there is a pending shortage of certificates, so as a consequence the market price has significantly increased from about $50 in mid-last year to more than $80 per certificate. An $80 certificate price multiplied by 12.75% gives $10.20/MWh (1.02 c/kWh) before being escalated for any retailer margin and distribution loss factors. Goanna Energy Consulting Pty Ltd 10 5

7/27/2016 AGENDA 1. Introduction 2. Market Update 3. Energy Efficiency 4. Risks & Caveat Emptor 5. Future Energy Landscape 6. Q & A Goanna Energy Consulting Pty Ltd 11 Cost Management Strategy Unit rates Physical assets Consumption Network & Retail Plant & Equipment Efficient Utilisation Goanna Energy Consulting Pty Ltd 12 6

7/27/2016 Control Levers  Business Intelligence  Procurement Model  Network Tariff Reviews  Energy Efficiency  On-site Generation Goanna Energy Consulting Pty Ltd 13 Control Levers  Business Intelligence What’s happening in the market? What’s driving my energy cost?  Procurement Model  Network Tariff Reviews  Energy Efficiency  On-site Generation Goanna Energy Consulting Pty Ltd 14 7

7/27/2016 Control Levers  Business Intelligence  Procurement Model What’s best practice? What’s are the options?  Network Tariff Reviews  Energy Efficiency  On-site Generation Goanna Energy Consulting Pty Ltd 15 Control Levers  Business Intelligence  Procurement Model  Network Tariff Reviews What’s coming? Is my current tariff the best?  Energy Efficiency  On-site Generation Goanna Energy Consulting Pty Ltd 16 8

7/27/2016 Control Levers  Business Intelligence  Procurement Model  Network Tariff Reviews  Energy Efficiency Has the Business Case changed? Maximising investments  On-site Generation Goanna Energy Consulting Pty Ltd 17 Control Levers  Business Intelligence  Procurement Model  Network Tariff Reviews  Energy Efficiency  On-site Generation What options are there? What is the best Business case? Goanna Energy Consulting Pty Ltd 18 9

7/27/2016 Top 5 Initiatives You Guess the Payback Period? • Solar PV? • Battery Storage (Combined with Solar)? • LED Lighting Conversion? • Ceiling Insulation? • End of Class/Day/Week Shutdown process? • Leaking Hot Water Service • Heating Controls Goanna Energy Consulting Pty Ltd 19 Average Payback Periods • End of Day Shutdown process: Immediate! • Leaking Hot Water Service: < 1 Year • Heating Programmable Controls: 1 – 2 Years • LED Lighting Conversion: 3 – 5 Years (Duty) • Reverse Cycle A/C Replacement: 3 – 5 Years • Ceiling Insulation 5 -7 Years • Solar PV 6 – 10 Years • Batteries 10 – 16 Years (Warranty 10?) Goanna Energy Consulting Pty Ltd 20 10

7/27/2016 AGENDA 1. Introduction 2. Market Update 3. Energy Efficiency 4. Risks & Caveat Emptor 5. Future Energy Landscape 6. Q & A Goanna Energy Consulting Pty Ltd 21 Top 5 Commercial Energy Risks • Being Uninformed/Outdated knowledge (Assuming you can manage energy maters by yourself, is like me thinking I could deliver a great maths class once a year) • Responding to Sales People/Advertising, (as opposed to executing a well thought out strategy. Ask me how many Solar proposals we have seen that are likely to deliver the promised savings!) • Not Optimizing the Network tariff ($1.5M) • Not Checking the Bill ($660K) • Not running a competitive tender process Goanna Energy Consulting Pty Ltd 22 11

7/27/2016 AGENDA 1. Introduction 2. Market Update 3. Energy Efficiency 4. Risks & Caveat Emptor 5. Future Energy Landscape 6. Q & A Goanna Energy Consulting Pty Ltd 23 Future Energy Landscape (1) • Network = Demand Based Tariffs – Impact on Solar Investments? • Energy = Risk of structural change – Fall-out from Energy Crisis – Rising gas prices on east-coast of Australia impacting • Gas appliances • Power generation Goanna Energy Consulting Pty Ltd 24 12

7/27/2016 Future Energy Landscape (2) • Best Practice = use of an energy Business Intelligence platform to track and prepare – Budgets – End-of-year cost outlooks – Invoice verification – Network Tariff Reviews – Next day maximum demand and/or energy consumption alerting Goanna Energy Consulting Pty Ltd 25 AGENDA 1. Introduction 2. Market Update 3. Energy Efficiency 4. Risks & Caveat Emptor 5. Future Energy Landscape 6. Q & A Goanna Energy Consulting Pty Ltd 26 13

7/27/2016 Thank you Marc White General Information Only: Whilst Goanna has endeavoured to ensure that the information contained within this presentation is accurate, we do not make any warranties or representations in (03) 6223 7253 relation to the accuracy of the information contained herein. This presentation is intended as general advice only and is not intended to constitute personal financial product advice. It is has been prepared without taking into account the personal circumstances, financial needs or objectives of anyone person or marc@goannaenergy.com.au organisation. Accordingly individuals or organisations, who seek www.goannaenergy.com.au to rely on information contained within this presentation, should undertake their own independent enquiries and seek legal or financial advice prior to doing so. Examples used in this presentation are for illustrative purposes only. Goanna Energy Consulting Pty Ltd 27 14