The Challenges of the Energy Transition

The energy transition presents many challenges to organizations. The first challenge for many organizations is their energy consumption is increasing. Spending money to save energy is not the first order of business for most organizations, so their energy use increases with growth. Transition in the presence of growth will be a tremendous challenge for many organizations.

One of our valued customers, a not-for-profit housing provider in Northwest Alberta, is facing this challenge. Their first order of business is to construct and operate affordable housing for the communities they serve. Their energy use is expected to increase by 20% in the next 5 years from 78,000 Gj/year to 93,600 GJ/year as they construct new housing units. With 80% of their energy use supplied by natural gas for heating and hot water, their annual energy bills are forecasted to increase by $250,000 within this same period.

The organization called on us to support them to reduce their forecasted energy costs. However, spending money on saving energy is not their priority for capital spending. As a not for profit organization, they look at putting every surplus dollar they receive into increasing their affordable housing stock. For this particular client, we are working with them to identify, evaluate and implement energy saving opportunities where the expected annual cost savings will exceed the project’s annual financing costs. They are prioritizing reducing operating expense over the rate of return or net present value of the energy savings projects. This enables them to rapidly redeploy their savings into new housing.

We recognize that all organizations are unique, and that energy savings projects are not one size fits all. We tailor our solutions to the problems that all organizations are facing, to the priorities of the organization.