26 July 2019/ rent_industrial_guide

6 ways to reduce energy costs for your industrial space

Maximising energy efficiency is an essential when it comes to managing your warehouse operating budget effectively

Modern warehouses are changing. Driven by new consumer shopping trends, today's warehouses have transformed into sophisticated operations with robots and lightning-fast product turnover. What’s more, demand for warehouse space has escalated with the rise of e-commerce, while supply is limited due to a variety of factors including increased construction costs and scarcity of land, especially in last-mile locations situated close to high-density population centres.

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The figures speak for themselves: UK logistics took up 17.4 million ft in the first half of 2018, exceeding the entire take up of 2017, according to data reported by commercial real estate services and investment firm CBRE. In fact, the demand for warehouse space has almost doubled over the past 10 years. And, with the cost of leasing warehouse space increasing, it’s no surprise that maximising efficiencies within the layouts and buildings themselves has become a priority.

One practical way to do this is by ensuring that energy costs are as low as possible. Not only will this help the bottom line, reducing energy consumption will help reduce your company’s carbon footprint and cut emissions. Indeed, conditions of contract and performance reviews are commonly asking for assurance of good energy and environmental performance and management from their partners in the warehousing and logistics sector.

Here are six energy-saving measures to help you take to control:

1. Use all available space

Are you using the space in your warehouse in the most efficient manner possible? If you’re stacking your product on the floor and not racking as high as possible, then you’re wasting valuable space. Vertical space is the cheapest space you can buy and the most expensive to waste. Before you sign a lease, do some space planning and consider creating mezzanine storage above your office build-out. Avoid heating, cooling and paying for wasted square footage – utilise every square foot you have.

2. Make the most of natural lightThe Carbon Trust estimates that lighting accounts for between 65% and 95% of energy use in ambient warehousing. Good quality lighting is essential for safe operation, yet there are simple and inexpensive ways to reduce lighting energy consumption and costs while maintaining adequate light levels. Many warehouses have areas where natural daylight through roof or wall lights provides sufficient light without the need for artificial lighting. An added benefit is that natural light has been proven to increase worker productivity and wellbeing. Also consider painting the warehouse white to make the space appear brighter.

Where lighting is required, savings can be made by replacing inefficient fluorescents with low energy LED products – non-refrigerated warehouses operating with legacy lighting solutions can typically reduce electricity costs by 70% by moving to LED. Installing LED lighting also reduces maintenance costs due the longer life of LED lamps. Adopting a workplace strategy of switching off lighting when good levels of natural daylight are present is another easy way to make significant savings.

3. Set up sensors

Low and no cost savings can be achieved by improving night time and weekend shut down routines. Sensors can also be really useful in warehouses.

Occupancy sensors: Modern sensors are effective, even with the use forklifts, and allow infrequently used areas to only use lighting when required. Lights are automatically turned on when somebody’s in the designated area and are turned off after a period of vacancy. Sensors can achieve savings of 30% or more on lighting costs and can be zoned by aisle or area depending on the individual requirements of your operation.

Daylight sensors: Light sensors or ‘photocells’ can be used to control artificial lighting when there is sufficient natural daylight. As daylight hours vary throughout the year, sensors help to provide better control and substantial savings. Daylight sensors are particularly effective when coupled with dimming to provide a variable level of artificial light subject to the available natural daylight.

4. Optimise heating and ventilation

Depending on the type of products stored and the standard of building fabric, many warehouses can operate satisfactorily year-round without the need for heating. However, for staff wellbeing, health and safety regulations state that employers must ensure that the temperature in the workplace is ‘reasonable’ at all times – the temperature should be a minimum of 16°C unless the work involves a lot of physical activity where this can drop to 13°C. Permanently occupied offices, staff welfare facilities or toilets require a permanent heating solution.

Many warehouses rely on natural ventilation, through windows, doors and roof vents. Where mechanical ventilation is needed, consideration should be given to options for heat recovery and also the efficiency of the fans to be used and how they’re controlled.

For example, stratification is caused by cold air entering a building, pushing the warm air inside towards the roof, with the cold air remaining at floor level. Destratification fans can counteract this by moving the trapped warm air downwards towards floor level. By making better use of the heat energy trapped at high level, your heating system can reduce its output, and significant savings can be made.

Due to the scale of the buildings involved, the Carbon Trust advises that roof mounted Solar PV arrays are often an effective longer-term investment to offset energy use and costs.

5. Improve insulation

The standard of insulation and how airtight the building is should be prioritised. When new warehousing space, extensions or refurbishments are planned, make the most of this opportunity to review the overall standard, improve existing insulation and ensure that any new facilities meet or exceed building regulation standards.

6. Make energy awareness part of your business culture

It’s important to ensure that all stakeholders in your business are aware of the benefits that energy efficiency can bring to a warehousing and logistics business. That means engaging and involving all staff in an energy management programme. The Carbon Trust advises implementing these key actions and techniques to achieve this:

  • Understand the current energy performance of your business and implement good standards of energy analysis and metering, monitoring and targeting (MM&T) to assess the potential for savings
  • Develop an effective long-term energy policy and strategy, with appropriate targets for reduction to minimise energy use
  • Adopt good investment policies which prioritise energy efficiency, based on whole life cost
  • Regularly review facilities and identify energy-saving opportunities
  • Build staff engagement with training, in parallel to communication of aims and objectives

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About the Author: Melissa Alexander
Melissa Alexander serves as Vice President for Foundry Commercial and works on the Industrial Services team in Nashville, Tennessee. The team represents users and buyers of warehouse and distribution space across the country. The team has industrial multi-market transactional experience in more than 10 countries. Alexander has been featured in Bisnow and was named to Duke Long's Top 10 Most Influential Online Commercial Real Estate People for 2018.