Q: Before the economic downturn, I was considering energy-efficient lighting for my general store. But with sales slow to recover and expenses continuing to rise, I’m not sure we can afford it right now. Still, I could use the lower energy bills I’d get with new lights. What’s the best financial move? - CM, Rutland
Paul:
In this economy, putting money into improving your business's energy efficiency is one of the best investments you can make. The businesses that worked with Efficiency Vermont to make energy-saving investments in 2010 are expected to earn a 50% average annual rate of return over the lifetime of their new, efficient equipment. It's tough to imagine other investments with such solid return potential. Another good reason to take energy-saving actions now is the simple fact that waiting is expensive. In other words, deciding to do nothing is like volunteering to pay higher energy costs than necessary, month after month.
Dan:
Your lighting upgrade is a great example of a wise investment. If you were, for example, to replace incandescent light bulbs with compact fluorescent lights (CFLs), you'd reduce lighting-energy costs by as much as 75%. CFLs also can last as much as 10-times longer. For overhead tube lighting, High-Performance T8s use as much up to 20% less energy than standard T8s and up to 50% less than T12s, and outlast either of them.
Paul:
When sales are dropping or leveling, it makes solid financial sense to reduce operating expenses, like utility bills, instead of passing rising costs on to customers. And, unlike many other actions designed to increase revenue, such as expanding business hours or services, efficiency improvements don’t need to come with permanently higher expenses, like increased payroll.
Dan:
In addition to energy savings, efficiency upgrades carry other benefits that can have a positive impact on your bottom line. Quality efficient lighting and/or HVAC systems can reduce maintenance and replacement costs. Upgrades can improve comfort for customers, who may want to shop in your store longer and return more often. A more pleasant store environment also can improve staff morale and productivity while literally putting products in a better light. And some consumers are attracted to businesses that show a commitment to the environment by reducing energy use.
Paul:
If you’re finding it tough to come up with the capital for facility upgrades, visit the Financing page to learn about financing arrangements. You’ll see approaches such as low-interest loans, designed to pay for energy-saving upgrades with little upfront investment from you, while providing you with more cash on hand. Many Vermont businesses taking advantage of such arrangements can create a positive cash flow by obtaining energy savings that exceed financing payments.
Dan:
Also at this website, you’ll find easy-to-use, downloadable forms, which you can mail in to get rebates for specified energy-efficient equipment purchases. Additional rebates may be available for custom projects. If you have any questions, give Efficiency Vermont a call, toll-free, at 888-9210-5990.
Paul:
Best of luck with your lighting project and thanks for a question that’s bound to help many Vermont business owners.