July 19, 2014 Business Planning en_US https://quickbooks.intuit.com/cas/dam/IMAGE/A2cCjGuNN/ea8db711f81885a0fd6f7e392eab0da8.png https://quickbooks.intuit.com/r/business-planning/power-business-renewable-energy Should I Power My Business With Renewable Energy?
Business Planning

Should I Power My Business With Renewable Energy?

By QuickBooks July 19, 2014

In deciding to transition your business to renewable energy, you may consider your knowledge of the process to be green or, in other words, not quite refined. But with the persistent uprising of renewables, going green is becoming easier than ever.

The International Energy Agency (IEA) defines renewable energy as energy derived from natural processes that are replenished at a faster rate than they are consumed. Common sources of renewable energy are solarwindgeothermalhydro and some forms of biomass, such as wood, agricultural crops or wastes, and municipal wastes.

As of early 2014, 144 countries have set renewable energy targets, which is almost ten times the number from 2005, when only 15 countries had policies in place. In 2013, the world generated 22.1% of its electricity from renewable resources. And the United States has vowed to increase renewable energy capacity 50% by 2020. As these numbers increase, clean energy is becoming cheaper and more favored among consumers and investors alike.

According to renewables consultant Dulas, every kilowatt-hour (kWh) produced through renewables is roughly equivalent to saving half-a-ton of greenhouse gases every year. Therefore, from an environmental standpoint, it’s a no-brainer. The same can be said from a financial standpoint: by implementing renewables into your small business, you can save money by lowering your utility expenses.

How to Decide if Renewable Energy Is Right For Your Business 

Renewable energy can be implemented into business operations no matter what industry the company is involved in. Many small businesses (e.g. restaurants, printers, hotels and wineries) are now taking advantage of going green. And some larger corporations have gone as far as transitioning to 100% clean energy, including:

  • Whole Foods in the retail and groceries industry
  • Environmental Protection Agency in government
  • Dannon in the food and beverage industry
  • The World Bank in the non-profit sector
  • TD Bank, HSBC and Deutsche Bank in the banking industry

When deciding to incorporate renewable energy into your company, it must make good business sense and have the potential to make a long-term positive impact. Additionally, you should take into account the region your business is located in, the accessibility to renewable energy resources within that zone, and the costs involved. Luckily, as clean energy has shifted from just a hip environmental trend to a genuine economic solution for providing energy to homes and businesses, the costs of attaining renewable energy has decreased. Thus, if you make the right moves and properly analyze the long-term numbers, you can save money.

Money you save using renewable energy can then be used for more important business factors, such as hiring employees and better product creation. In addition, you can make your business’s efforts to go green known to the community and beyond, which in turn can be used to generate positive PR and strengthen your brand.

Another benefit, optimized by the companies listed above that use 100% clean energy, is the ability to sell unused energy back to utility companies for other customers to use. As some clean-energy businesses generate more energy than they need, smart meters and changes to the grid and to regulations have made these energy sales possible. Utility companies can then cut back on the amount of energy they produce from non-renewable sources and reduce greenhouse gasses.

Factors to Consider 

With any significant change in business, there are many factors that can affect the ultimate decision. In the renewable energy realm, you should consider the advantages and disadvantages of each renewable source and renewable energy system. IRENA, the International Renewable Energy Agency, sees solar photovoltaic (PV), concentrated solar power (CSP) and wind power as the best prospects for cost reductions. With that being said, there are certain factors you should consider and specific questions you should ask your utility provider and renewable energy installer:

  1. Input Emissions: This relates to sun, wind and waste. If I’m going to put up a wind tower, does my property provide enough wind? Does it have the space? Is my roof strong enough for solar panels and is it situated for solar? Do trees block access to the sun? Is there local availability to waste for biomass energy?
  2. Output Emissions: If the energy is not completely for your own use, and you are looking to produce and sell excess energy on the grid, you should talk to your utility provider first about how this process works.
  3. Monetary Considerations: What can I afford upfront, and at what point will I see payback on my investment? Does my utility provider offer better treatment to one type of renewable over another? Does local, state and/or federal government(s) offer incentives through my utility provider?
  4. Environmental Impact: What types of renewable energy installations, if any, does my building or local zoning committee allow? Are there guidelines? If so, how do they affect my plans?
  5. Social Concerns: Will my plans for renewable energy installations be accepted by my neighbors? 

How to Make the Transition 

Before diving into the transition to clean energy, it is a good idea to lay the groundwork by implementing simple energy-efficient procedures. Some options include:

  • Using LED or Compact Fluorescent lights
  • Eliminating paper whenever possible
  • Swapping appliances with a greener equivalent, such as Energy Star products
  • Getting an energy audit (many states offer this for free)
  • Using green web hosting

The SBA (U.S. Small Business Administration) offers a list of helpful tips on ways to become more energy efficient.

In regard to attaining renewable energy, you need to decide how you will go about it. Boiled down, you have three options:

  1. Generate renewable energy on-site. On-site generation takes place at the location where the power is used. Solar panels, geothermal heat pumps, or biomass-fueled combined heat-and-power systems or devices can be used.
  2. Purchase green power through Renewable Energy Certificates (RECs). Renewable Energy Certificates, also known as “green tags, green energy certificates or tradable renewable certificates,” are a good option for leased spaces. These are tradable, non-tangible energy commodities that show proof that one megawatt-hour of electricity was generated from an eligible renewable energy resource.
  3. Purchase renewable energy from an electric utility provider. In most areas of the U.S., utility providers now offer “green pricing” options. Reaching out to your utility provider is the easiest, most streamlined approach to applying clean energy to your business. To find out which organizations offer green power in your state, check out the U.S. Department of Energy’s “Can I Buy Green Power in My State” page.

At the end of the day, it’s about the bottom line. By tackling both the energy-efficient tips and the transition to green power technologies, you can ultimately save thousands of dollars. Beyond this, you will also expand your clientele to eco-conscious consumers. Whether it’s through free PR or incorporating an environmental mission statement on your website, take ownership of your new eco-friendly manifesto, and make it known to the world. Simply put, patrons feel like Good Samaritans when they know they are spending their money on businesses that benefit society. And, hey, customers might even spend more money knowing that you are making environmentally conscious decisions.


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