Businesses must navigate financial and environmental paths to a low-carbon future.

New Zealand's potential for a prosperous low carbon future is at risk of slowing unless businesses introduce solutions in the right way at the right time, a leading energy expert has warned.

Dr James Neale director of Waikato University's Engineering Energy Research Centre says there is no single solution to becoming a low carbon business in New Zealand - or the world.

"There are many and the trick is to introduce them in the right way and at the right time or we risk slowing our country's unique potential for a low carbon future," he says.

At the same time Neale says it is important that companies looking to move away from fossil fuels and become more energy efficient are still around in another 20 years: "The only way that can happen is if they are financially as well as environmentally sustainable."


He says he is aware of the temptation for businesses to invest heavily in up-front fixes without first having a workable business plan where financial and environmental sustainability go hand in hand.

The university - one of New Zealand's leaders in energy management and engineering - has been providing strategic advice to the government, and grass roots support for companies for 16 years.

Neale, who has been at the forefront of this work for 14 years, says he is excited by the progress businesses are making to maximise their energy efficiency potential.

"We must have a stable platform for a low-carbon future and many businesses are grappling with what that might look like," he says. "The first step is to complete a thorough energy audit, which will enable a comprehensive energy-management plan to be implemented over time.

"Technology, systems, processes and fuel-types all have a role in the transition to being a low-carbon business, but it will be different for each, depending on size, industry, capabilities, resource availability, infrastructure constraints - and many other contributing factors."

One of the starting points for Neale is efficiency: "There is no need for businesses to be using energy to create heat that far exceeds the temperature required for a job. For example, burning natural gas at 1000 degrees when a space may only need to be heated to 18 degrees."

Neale says in such a case, it may be the fuel type or technology is not fit for the purpose.

A heat pump could be doing the job more efficiently and with less expense; likewise, electricity can be turned on and off easily, which is useful for temporary heating scenarios.

Dr James Neale director of Waikato University’s Engineering Energy Research Centre. Picture / Supplied.
Dr James Neale director of Waikato University’s Engineering Energy Research Centre. Picture / Supplied.

Heat pumps are a versatile technology which Neale says "if applied correctly can deliver significant emissions savings. The technology also allows for waste heat to be captured and reused in other parts of business, lessening the overall need for heating and cooling.

While New Zealand has one of the best low-emission electricity grids in the world, Neale says other fuel types will continue to have a role in the move to a low-emissions economy and beyond, highlighting the importance of 'transitioning.'

"In some circumstances an immediate switch to a more expensive fuel-type could create a five to six fold increase in costs to the customer," he says. "A more gradual shift with the right technology applied in the right way will, as part of a comprehensive strategy, deliver a more sustainable long-term solution."

For certain jobs, such as high-temperature process heat, Neale says there will still be a need for fuels that have a higher energy density – currently served by fossil fuels like coal. However, biomass is a low-carbon equivalent that could see the phasing out of this emissions-producing fossil fuel.

"Wood residue, waste wood and sawdust can be a good replacement for coal in process heat boilers and this makes sense for businesses that have ready access to supply," says Neale. But, he concedes, proximity to the waste wood provider will be a factor in take-up.

"Geography is another factor that would be taken into consideration in the energy management plan and, again, proves the importance of generating a detailed long term road map to being a low-carbon business," he says.

The university and the Energy Efficiency and Conservation Authority (EECA) have devised a way of determining a clear process businesses can follow to make sure they invest in the right things at the right time.

EECA's energy management plan is made up of six main parts - from data gathering to capital expenditure allocation and staff engagement. The order in which these happen may differ from business to business, but to realise long lasting benefits and make continuous improvements, energy management plans need to reflect the whole picture.

Richard Briggs, EECA's manager of programme partnerships, says this isn't about generating a two-dimensional checklist that is handed to businesses with the expectation they are now equipped to succeed.

"Many businesses do not have in-house engineering capabilities or staff capacity to generate an energy management plan on their own, and even those that do should check in with external sources to verify their strategy is robust," says Briggs.

"For companies seeking assistance in designing an energy management plan, there are qualified engineers and advisors with specialist skills who can work with them throughout the energy management journey – to find the best financial and environmental fit long term."

EECA has a list of certified programme partners and service providers - many of whom have received training from the university - that can assist businesses with each element of the energy management plan. This support can often be part-funded by EECA.

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