With Energy prices set to rise substantially from July 1st 2022, there has never been a better time to look at what Electricity Tariff you are on and how you are being billed by your energy provider. Most business owners are classified as small (use under 100MWh’s a year) or large (use over 100MWh’s a year).
Table 1 below shows the difference between a small customer on Tariff 20 and a large customer on tariff 44 with Ergon Energy. While Tariff 44 customers enjoy a lower kWh charge, they are charged $44 .53 a day to be connected and $28.65 a KW for a demand charge. It is this connection fee and demand charge that can really make up your power bill if you are just above the 100 MWh threshold.
As you can see below moving from a Large to a Small customer can make a significant difference to your annual power bill. Tariff 20 is only $1.33 a day to be connected and has no Demand Charges.
Table 1
How Can a Solar Power Purchase Agreement (PPA) Make a Difference?
The only way you can move from a Large customer to a Small customer is through less usage of Electricity per month. A great way to achieve this is to use cheaper clean energy from the sun through a solar PPA. With a Solar PPA you spend NO CAPITAL on a solar system but purchase the clean energy from it at a cheaper rate than the grid.
The benefit is that you can move from a large customer to a small customer using $0 Capital.
Table 2 shows the benefit of having a 39KW Solar System on your roof as a Solar PPA. A 39KW Solar system on average produces 4500 kWh’s a month or 54 MWh’s a year. The example in Table 2 is showing what your energy bill could look like if you purchased this solar energy through a Solar PPA instead of using the grid.
If your business uses all this solar it would reduce your monthly usage from 8500 kWh’s to 4000 kWh’s. Businesses do operate differently however we know that for example Gyms, Pub’s, Clubs, Motels, Hotels, Shops, Caravan Parks and Retirement Villages are perfect for this. As you can see in the example you can save your business up to $12,557 a year in Energy bills with a $0 Capital outlay.
Table 2
What happens if I am Small customer just under the 100MWh threshold?
The introduction of Electric Vehicles into Australia is going to increase Energy Usage in your business significantly. Only One Electric Car Charger can add over 7.5KW an hour to your building. They use more power than a large air conditioner. The Queensland Government alone is predicting up to 40% of all vehicles purchased to be Electric within 7 years.
It is critical that you keep your business in the Small Customer range to save and not to get bill shock by moving into the Large Customer zone. Going solar is one of the best ways to achieve this.
What if I only Lease my Building?
Going solar by purchasing a Solar System outright or by using a Solar PPA can make a large difference to your energy bill and to your journey to Net Zero. Horan & Bird have flexible Solar PPA’s that are Landlord friendly and will match your lease periods. We also have a new Mobile Solar Range that is zero risk and an obligation free proposition for both landlords and tenants alike.
To learn more about your options contact our team here or call us on 1300 467 262
Founder of Horan & Bird. Director of Master Electricians Australia and Board Member of Solar Accreditation Australia. John has played a key entrepreneurial role in the transformation of the Energy Landscape in Queensland.
