Call them the two greatest challenges now facing American businesses: Companies must not only survive the "Great Recession" of today, but must strategically position themselves for the green economy of tomorrow.
The bad news is that the pressure to perform flawlessly on both scores is greater than ever.
The good news is that there are ways to do both for the short-, medium-, and long-term, saving money while also reducing a company's overall carbon footprint.
More than ever before, sustainability objectives converge with profitability expectations. In fact, one of the best means of doing so comes from an expense many companies take for granted -- lighting.
Often, lighting is simply a forgotten topic.
Best case, it may only be a fixed cost with limited wiggle room -- yet it still has a significant impact on the operational bottom line, especially given fluctuating energy costs.
According to the U.S. Department of Energy, lighting consumes as much as 30 percent of all electric expenses in commercial buildings nationwide, costing some $37 billion -- an amount almost equal to Fed Ex's entire revenue last year.
In the typical commercial building, lighting costs about $1 per square foot, but with recent advancements in lighting technology, it's now possible to bring that number down by 50 percent. Not a small savings for any business: A typical 200,000 square foot building may offer $100,000 annual savings through re-lighting.
No, this is not some visionary technology that may never leave the confines of the R&D lab. Nor is it so complex that it can't be deployed under real-world conditions.
It's using the smart use of the cutting-edge technologies that are commercially available today to solve twin challenges that face virtually every business in America today. The implication for business can be profound -- exactly the "twofer" they have been looking for: Cutting costs while also minimizing a company's carbon footprint.
In one example, a national department store we worked with had more than 160 stores, offices and distribution centers across the United States totaling more than 13 million square feet of space. But they were using outdated lighting that cost them $15.6 million annually.
An $11 million investment was made to replace their lighting systems using high performance lamps and electric ballasts to standardize the lamp types throughout all facilities. Existing four lamp fixtures were delamped to save energy while maintaining light output and distribution using new reflectors and louvers. Existing fixtures were cleaned to restore reflectivity and light control sensors were installed.
Because time is money, the upgrades were done during nighttime hours to ensure minimal impact on the business, its customers and employees. The investment paid itself back within 14 months based on the savings accrued. This retailer shaved $4.3 million in annual costs plus another $1.7 million in projected maintenance savings. In cases where financing is done over 36 months, the net cash flow is $144,000 annually, with no waiting more than a year for a payback.
The return on investment extends from the balance sheet to the environment -- the energy efficient lighting upgrade prevented hundreds of thousands of pounds of power plant carbon emissions from entering the atmosphere -- the equivalent of removing 2,500 cars from the road.
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