11. How much does it cost to be energy effective?
The benefits are great – you’re convinced about that. However, it always comes back to cost. What’s it going to cost?
If you thought the benefits were great you’ll really be impressed now. One of the things that is so amazing about energy conservation upgrades are how large the savings are and how quickly they appear. The First Energy Group has developed our Shared Savings Program whereby we jointly agree up-front what your savings will be. Then, we use a portion of these savings for a period of time to apply them to the purchase of your upgrade. The other portion you immediately keep. Now instead of looking at what this will cost the real question becomes how quickly can I increase my cash flow? Your energy conservation upgrades will always pay for themselves. You don’t have to invest one cent to get these benefits. This isn’t too good to be true. Energy conservation is really that obvious a solution. See the Department of Energy’s website if you want the “gold standard” of reliability.
The First Energy Group Shared Savings Program allows you to get the full benefits of an energy efficiency upgrade with only positive cash flow on your part. The length and percentage of savings are based upon what types of recommendations we offer and are specific to each facility.
On the other hand, some people just want to purchase their upgrades and be done with it. Well, that’s ok also. The First Energy Group will offers both options and you choose what works best!
Here are some considerations to be aware of:
Shared Savings
- You have more control over an operating budget than a capital budget
- You want to see constant positive cash flow
- You want to leverage The First Energy Group’s money to grow your business.
- You have exceeded internal depreciation levels and would like to defer expenses
- You can get quicker authorization on a smaller monthly amount
- Your approval process is simpler
Purchase
- You don’t want the hassle of cutting monthly checks
- It’s easier to get capital approvals than to touch your operating budget
- You don’t have strong enough financials to support the credit requirements of Shared Savings
- You have a lot of cash and are looking for a place to invest it that will yield a strong financial return (often 40% plus)
- In any case don’t let these choices hold you up from doing the right thing. Call us with any questions you might have.
Over the years we’ve offered both programs and we’ve never been able to find a pattern as to what types of companies choose which. If it’s easier for you to get approval to lower your operating expenses than to get a capital approval then pick what works for you.
