Stop expensive energy waste

NEW BUSINESS:Earlier this year, Tesco announced that it was planning to spend €30 million in Ireland over the next five years to reduce its energy consumption by half, in a bid to cut its carbon footprint and tackle rising energy costs.

Tesco Ireland intends to introduce 100 per cent recycling of store waste and packaging by 2010. This will see more than 24,000 tonnes of waste recycled each year, equivalent to the waste generated by a town of 20,000 people. It also plans to build what it describes as the most environmentally-friendly store in Ireland by 2009 - built from recycled materials.

Cynics may say that high energy costs and PR rather environmental awareness is driving large corporations to adopt a more environmentally-friendly approach to business, but nevertheless, there is a lesson here for start-ups - if a big multi-national retailer is feeling the pinch from high energy costs, it is highly likely that the pain is going to be multiplied for the smaller guy.

"With the cost of oil and slower growth, the more efficient you are the better. The money saving is substantial, there is no doubt about that," says energy coach Aodhan MacPhaidin.

Energy savings do not only reap benefits for multi-nationals such as Tesco. SMEs and start-ups can benefit from taking a look at their energy usage.

"For start-ups, you would be crazy not to look into energy efficiency at the beginning. Retrofitting is always going to cost more," says MacPhaidin, adding that proper insulation and glazing can make a big difference. But it doesn't take huge investment to be energy efficient.

It is easy to save energy, money and do your bit for the environment, beginning with a few small changes. Companies that undertake energy management measures can expect to achieve as much as a 20 per cent reduction in their energy bills - and that's through good housekeeping measures alone, according to Liam Connellan, spokesperson for the Government's Power of One at work energy saving campaign. In total, Irish SMEs could avoid €100 million per annum in energy costs by exploiting opportunities for energy efficiency gains.

The measures are simple - from switching off lights and heating in the office when they're not in use, and particularly in meeting rooms or unoccupied service areas to taking advantage of natural daylight as much as possible or configuring your computer to "energy saving" mode.

Turning your computer off at night instead of leaving it on will save on average 25 per cent of its annual energy bill.

Always ensure that all other office equipment such as printers, scanners and photocopiers are fully switched off as well, says MacPhaidin.

"Offices would waste about €9,000 each year by leaving their equipment on over weekends and bank holidays. Lighting an office overnight wastes enough energy to heat water for 1,000 cups of tea.

"A photocopier left on overnight uses enough energy to produce over 1,500 copies. It does all add up," he says. To see how it adds up, companies should look no further than Emyvale, Co Monaghan-based Silver Hill Foods. In 2004 the family-owned duck production and processing company, embarked on an energy management programme, saving almost 10 per cent of total annual energy costs.

Fundamental to Silver Hill's success is buy-in from staff throughout the organisation. The success of energy management depends on the cooperation, acceptance and participation of everyone involved, according to Connellan, who says it must be championed from the top.

"Somebody has to have to responsibility for it. In a very small company it might be a managing director or chief executive," he says. "The company and its managers have to provide leadership, put time and effort into promoting the idea."

Through the participation of staff, a series of no-cost measures were implemented which have yielded welcome savings at Silver Hill.

The "lunchtime initiative" saved the company a total of €5,000 per annum simply by people switching off equipment at lunchtime and during breaks. Simple actions such as keeping doors closed between hot and cold areas and repairing all air and water leaks also yielded significant savings.

The repair of leaks in the compressed air system resulted in the elimination of one compressor running constantly and led to an annual saving of €8,000.

And there are other spin-offs too, according to MacPhaidin. With climate change increasingly on the agenda, it's good PR for companies to tout their green credentials. And such firms are attracting money from funds wishing to invest in environmentally and ethically sound companies.

"But there is a fine line between green-washing and where you are doing it for the right reasons," he says.

BUSINESS ANGEL CASE STUDY

This month, our two companies are enjoying competition successes in their quest to raise cash through the Business Angel Partnership

OPENPLAIN

Dublin-based start-up Openplain, which recently launched its JournalLive online monitoring software service, scooped its second major prize of 2007 in December when it won €50,000 as winner of the best emerging company category at the final of the 2007 IntertradeIreland All island Seedcorn competition. Last May it was awarded first prize and a cheque for €10,000 at the prestigious Docklands Innovation Park Investment Awards.

The winnings will be invested in developing the company, but Openplain's managing director Jonathan Mulligan (pictured above) says that scooping the various competitions has had other benefits.

"It puts us in a very strong position and it gives us a pillow for another few months if we needed it," he says. "But it has been a huge benefit for us in raising money. There are so many companies out there looking for BES money and potential investors, so to have anything that distinguishes you is very helpful. It is a great vote of confidence and sets you apart from everybody else who is vying for their attention and their money."

And the latest win couldn't have come at a better time. The company is currently in negotiations with various potential investors about raising private equity. But Mulligan says he doesn't expect a deal to be hammered out until early February. "It is quite a long process," he says.

The company is aiming to raise €750,000 and Enterprise Ireland is willing to commit €375,000 if the company can get matching funding. However, from the interest shown so far, he says that expects the fundraising to be oversubscribed. To cater for expansion this year, the company has also moved into a bigger office within the National College of Ireland business centre in the IFSC.

FLUIRSE

Having secured new premises in the past month, Kerry-based e-learning company Fluirse can proceed with its expansion plans which will see it take on eight new staff in the coming year.

Over Christmas, the company is planning to move into a 4,000 sq ft building, which is more than double the size of its existing two buildings in the Tom Crean business park and in Tralee town. Finding a suitable premises is a difficult undertaking, according to Fluirse director Kristian O'Donovan (pictured below right with fellow Fluirse director Tomas Finneran).

"We were lucky enough in that in Tralee there is a lot of development going on at the moment and quite a few office spaces are being made available but there is a long process involved in organising leases with solicitors and agreeing rent."

The company has agreed a standard nine year, 11 month lease on the new building.

"But we have an option to buy it within five years," explains O'Donovan. "That was one of the things we really wanted to get in there because rent money is really wasted money."

The company is also close to raising around €400,000 through the Business Expansion Scheme (BES) and Enterprise Ireland. Investor confidence in the company will have been boosted by the fact that the business won €10,000 for the "Best Venture stemming from a university spin-out or platform programme" at the recent 2007 Intertrade Ireland All island seedcorn competition last month. O'Donovan says the award would greatly help the company in securing private investment.

"It is a great endorsement to have, especially when investors are looking at your company," he says. "We were delighted with it. It is vindication that you are moving in the right direction with the company."