Small Business Energy Initiative: Teaching Energy Efficiency Best Practices

COSE/GCP recently hosted a group of chamber and small business association leaders in a deep-dive discussion around the topic of energy efficiency. Here are some of the topics that were discussed.

Chamber and small business association leaders from across the country, spanning a region from Massachusetts to Colorado, came together under the Department of Energy Small Business Energy Initiative for a deep dive on Sept. 19 at the COSE/GCP offices in downtown Cleveland. The purpose of the gathering was to help these leaders learn catalytic strategies to engage their small business members in energy efficiency gains.

Led by COSE and the Institute for Market Transformation, attendees joined in a dynamic conversation that included graphic facilitation to capture the highlights, and to learn how to leverage energy efficiency and green leasing as economic development drivers for their community.

The agenda was focused around market transformation topics that discussed the role of the chamber and similar organizations to drive small business energy efficiency; engaging the right stakeholders/team; engaging landlords and tenants at the same table around the lease to move the efficiency needle; establishing a local contractors network; and energy efficiency as a catalyst for retention strategy. 

So, what’s next?

No one has a magic wand or silver bullet on cracking the code of engaging small businesses better than the next organization. But when a group of likeminded, savvy leaders come together, you know some good brain trust is gathered and new ideas always emerge.

Attendees were at all stages of the energy marketplace and through the Department of Energy initiative grant, technical assistance can be provided to these new markets to strategically implement energy efficiency programming with a green leasing component. 

Which organizations will take the leap? During the next month, the COSE and IMT will be fleshing out those details. 

And over the next year and a half, the Initiative will seek to conduct more than 400 energy audits across various markets (including Cleveland, through COSE’s energy audit program with FirstEnergy) and review at least 100 leases to provide recommendations around green leasing to enhance the relationship between landlord and tenant, with the ultimate goal of helping those small business realize energy efficiency goals through upgrades and retrofits.

We will keep you up to date on the follow through that takes place following the energy initiative meeting that took place. In the meantime, visit our Energy Hub to learn more about how COSE/GCP can help your business be more energy efficient and save.

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  • Next up: Small Business Internship Program Kickoff
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  • Small Business Internship Program Kickoff

    The COSE/Youth Opportunities Unlimited/Cuyahoga Community College Small Business Internship Program held its official kickoff meeting on September 23.

    The COSE/Youth Opportunities Unlimited/Cuyahoga Community College Small Business Internship Program held its official kickoff meeting on September 23.

    A total of 22 interns will be working with 19 small businesses on projects that will help the small businesses with generating sales leads, improving the way they use social media and answering key market research questions.

    •    RELATED: Learn how your small business can benefit from an internship program.

    This pilot will run through year end and the goal is to create a sustainable approach to creating experiences for local students to connect with small business owners to get real world experience solving their real challenges in growing and running their businesses.

    22 interns will be working with 19 small businesses on projects that will help the small businesses with generating sales leads, improving the way they use social media and answering key market research questions.  This pilot will run through year end and the goal is to create a sustainable approach to creating experiences for local students to connect with small business owners to get real world experience solving their real challenges in growing and running their businesses.

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  • Next up: Small Businesses and Electric Billing: How to Control Demand and Consumption
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  • Small Businesses and Electric Billing: How to Control Demand and Consumption

    Are you aware of the unique electricity billing for small businesses? Not only are small businesses billed for the energy they consume, but they are also billed for their energy demand. Energy demand refers to the average kilowatts necessary for usage over a given period of time. The charge for energy demand is based on the highest half hour of energy usage in a given month. Therefore, the cost for a businesses’ demand for energy can be greatly increased by even a short spike in electricity usage. 

    Are you aware of the unique electricity billing for small businesses? Not only are small businesses billed for the energy they consume, but they are also billed for their energy demand. Energy demand refers to the average kilowatts necessary for usage over a given period of time. The charge for energy demand is based on the highest half hour of energy usage in a given month. Therefore, the cost for a businesses’ demand for energy can be greatly increased by even a short spike in electricity usage.  

    In order for a small business to reduce energy costs, the consumption and demand for energy must be addressed as both are factors for electricity billing. However, it can be easy to simultaneously reduce consumption and demand by becoming more energy efficient.

    One area that can be quickly improved to reduce consumption and demand is lighting. If your business has bulbs or lamps that use around 100 watts, upgrading to LED lighting that uses about 10 watts can greatly reduce both your usage and demand. If all of the lights were upgraded to LEDs, you would be using about a tenth of your previous wattage for lighting. This reduces the energy you consume, as well as your energy demand!

    As many small businesses have equipment that is vital to their processes, focusing on upgrading lighting is key as it is a quick task that can help to reduce your total electricity consumption and demand. Reducing your electricity usage for lighting can help to offset any large equipment in your business that uses the bulk of your electricity.

    Another way to reduce demand costs for your small business is by using a phased approach of turning on the equipment in your business. Instead of turning all of your large equipment with high energy needs on at the same time, gradually turn on these pieces of equipment. Using a phased approach for your larger equipment helps to prevent spikes in your energy demand, which can help reduce the cost for this part of your electricity billing.

    By making easy upgrades to your lighting and by being conscious of your energy demand with larger equipment, you can start to control and reduce your business’ energy costs!

    To learn more about how small businesses are charged for their electricity demand, read this quick explanation about energy demand from First Energy.

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  • Next up: Social Media as a Tool to Identify Qualified Candidates
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  • Social Media as a Tool to Identify Qualified Candidates

    How can you maximize your hiring efforts through social media? Ask your savvy employees to help you indentify quality candidates.

    How can you maximize your hiring efforts through social media? Ask your savvy employees to help you indentify quality candidates.

    Companies such as Appirio and Jobvite will locate people throughout your social networks like Facebook, Twitter and LinkedIn.

    “Appirio’s matching engine comes up with a list of friends whose job titles, geographic location and other keywords match their company’s available positions, and the employee can send them a referral [through] Facebook,” said Ryan Nichols, Appirio’s vice president for product management. The matching engine has access to the same information that a Facebook friend does.

    Jobvite offers a similar service, but with a wider range. While the Appirio software can currently search Facebook contacts, Jobvite can search Facebook, LinkedIn and Twitter contacts. “And anyone who receives a Jobvite can search their own networks and pass it along again,” said Dan Finnigan, the chief executive of Jobvite.

    Furthermore, your employees can be your most effective recruiters. Gladys Stone, a corporate recruiter in San Francisco, says it’s smart for employers to tap into employees’ social networks. [The practice] accelerates the personal referral process and [opens up the field to diverse candidates], as many social network users have hundreds of friends or contacts in their networks, she said.

    If you’re willing to get a little creative and enlist the help of your employees, as many small businesses do, social media can help you increase your talent pool. Larger organizations, while competitive, can’t always move as quickly as you or offer higher growth potential opportunities the way that you can.

    Empower your people and you will receive a return on your investment!

    References: 
    http://guides.wsj.com/small-business/hiring-and-managing-employees/how-to-attract-talent-to-a-small-company/
    http://www.nytimes.com/2009/05/31/jobs/31recruit.html?_r=1&
    www.appirio.com
    www.jobvite.com


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  • Next up: Solar Energy Powering Savings in Ohio
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  • Solar Energy Powering Savings in Ohio

    The pace of solar installations is heating up in Ohio and companies are reaping the economic and PR benefits.

    It took 40 years for 1 million solar energy systems to be installed in America, a feat that was accomplished in May 2016. It’s expected it will take only two additional years for the second million installations to occur. The rise of solar in America is based on several factors, including the need for energy independence, the rising cost of electricity prices, and the environmental benefit of not having to burn fossil fuels.

    As of March 30, 2017, approximately 2,250 solar energy systems have been installed in Ohio. This includes 470 installations in the 13 counties that comprise Northeast Ohio, totaling 23 MW. For every 1 MW of solar installed, approximately 164 homes can be powered. This means approximately 3,800 homes are powered through solar energy in Northeast Ohio. In Cuyahoga County alone there are approximately 160 solar installations totaling 7.75 MW.

    According to a recent report from the Solar Foundation, there are more than 5,800 people working in solar in the state of Ohio. Cuyahoga County employs the most people in the state, with just more than 1,000 people employed in the industry. The bulk of solar jobs are blue collar installation jobs that pay good wages and cannot be exported. The largest solar installation company in the region is YellowLite, which is headquartered in downtown Cleveland and services the entire state.

    In 2016, YellowLite installed 102 systems, including 93 in Ohio. Looking at accepted SREC (Solar Renewable Energy Credit) applications through the PUCO, we found a total of 389 systems were accepted for SRECs in 2016. According to their numbers, Yellowlite has installed nearly one out of every four solar energy systems in Ohio.

    Why go solar?
    The most important reason people decide to go solar is economic. Residential and commercial clients recoup their initial investment and receive decades of free electricity. Solar panels are the largest cost of an installation. They are rugged, durable pieces of technology that have no moving parts and require no maintenance. The industry standard warranty length is 25 years, with most research indicating many panels will last for 10 or more years beyond the end of the warranty.

    Residential solar installations generally have a payback between eight and 10 years. There are fixed costs involved for every installation which include the labor, permitting, and administrative costs. Larger systems have a shorter payback based on the marginal decrease in price per panel as the system size increases. Solar energy systems are exempt from state sales and property taxes. They will generally not increase a homeowner’s insurance premium. Best of all, if the house is put on the market, system owners can expect a premium upon sale that is generally equal to the initial contract cost minus depreciation based on the 25-year expected lifetime of the system.

    For companies that install solar on their commercial properties, the payback rate is measured at around five to seven years. Businesses can not only take advantage of the 30% Federal ITC (The Investment Tax Credit (ITC) is currently a 30 percent federal tax credit claimed against the tax liability of residential (Section 25D) and commercial and utility (Section 48) investors in solar energy property) , they can depreciate their investment at an accelerated rate through Modified Accelerated Cost Recovery System MACRS. Businesses can lock in energy rates for decades while hedging against rising electricity prices.

    Businesses that add solar also accrue additional intangible benefits. Solar can enhance your brand, serve as a newsworthy event that can be shared with local media, and demonstrate that a business is concerned about sustainability, which is viewed as popular in the community. Branding a company as green can also lead to greater employee retention which, over the course of time, can be far more economically lucrative than the energy savings that result.

    Solar is a viable option in Northeast Ohio. More and more residents and businesses are considering solar as an economic hedge against rising electricity costs as well as the most important single action that can be taken to reduce your environmental impact.

    Ryan Veith is a Communications Manager for YellowLite, a solar installation company serving Ohio that has done more than 340 solar installations.

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  • Next up: Solar Power For Your Business
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  • Solar Power For Your Business

    Now is the time to consider Solar Power for your business. A flat roof is the ideal place to install solar panels.  Why?  The panels are mounted in frames that are ballasted to stay in place, there are no penetrations of the roof, and solar can supply one third to one half of the power used by a light manufacturing facility, warehouse, distribution center, or a wholesale or retail store.

    Now is the time to consider Solar Power for your business.

    A flat roof is the ideal place to install solar panels.  Why?  The panels are mounted in frames that are ballasted to stay in place, there are no penetrations of the roof, and solar can supply one third to one half of the power used by a light manufacturing facility, warehouse, distribution center, or a wholesale or retail store.

    As of August 2014, the 25 companies with the largest number of solar installations have over 1,110 installations in this country with a combined capacity of nearly 600MW and they are continuing to add capacity.  What all these installations have in common is that they are on buildings with large flat roofs.  The companies with the largest number of installations are Walmart, Kohl’s, Costco, Apple, and Ikea.

    In this part of the country, solar panels on a 100,000 sq ft roof can produce about 1 million kwh per year.  At a typical rate of 9 cents per kwh, that is $90,000 worth of electricity.  A project this size might cost $1,600,000. Is it worth it?  With a combination of tax incentives and financing, the project will pay for itself in three years.  Here is how it is done:

    • 50% of the project is financed with a 10 year loan from a bank that will give a low interest rate loan on a green project.  The reduction in utility costs pays the debt service.
    • 30% of the project is paid for by the Investment Tax Credit.  The ITC is available immediately upon completion of the project, but can be factored into estimated tax payments in anticipation of completion. 
    • 20% of the project cost is the tax benefit from depreciation for the first three years.  The project can be depreciated over five years using accelerated depreciation.   The tax benefit from depreciation over the remaining years is equal to 8% of the project cost.
    • 3% of the project cost is from utility company incentives (net of tax) in the first three years.  In Ohio right now, utility company incentives known as Solar Renewable Energy Credits (SRECs) can be sold for .025/kwh for the next five years and .02/kwh for the next five years.  Over a 10 year period, SRECs, net of tax, will pay for 9% of the project.

    A solar project will produce power for 20 to 30 years or longer with minimal maintenance.  Utility company rates will continue to rise due to regulation and inflation.  The cost of a solar project is known from the start, and once paid for, the power is essentially free. 

    Caution!  The ITC expires at the end of 2016.  Projects must be completed before then to qualify.  The supply chain vendors and installers anticipate a surge of orders that they may not be able to handle. 

    Contact COSE Energy at 216-592-2205 or energy@cose.org for more information, or Martin Shook at MShook@racercpa.com

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