2.4 Secure funding and resources

Funding and resources are needed to manage and implement an energy management program successfully. For example, time needs to be allocated to personnel who will be responsible for implementing the program, and funds are required for external consultants. Requirements such as these are typically allocated through the business’s normal budget processes.

Because energy-efficiency projects are often cross-cutting, funding may come from a variety of sources. It is important to be fully informed of funding options and the timing associated with them, because those factors can make the difference between a project being implemented or just sitting on the shelf. Potential funding sources are summarised in Table 3.

Table 3: Potential funding sources for energy-efficiency projects
FUNDING SOURCE DESCRIPTION
Operational expenditure (Opex) Funding to maintain business operations. Opex funds have a short-term focus and so are more suited to lower cost/shorter payback projects
Capital expenditure (Capex) One-off expenditure on items required to generate income in the future. Capex funds often have a mid- to long-term focus and may require a more competitive business case to secure funds
Business improvement funds Some organisations have business improvement programs. Energy-efficiency projects may be eligible for funding through those programs where there is a significant productivity benefit
Corporate funding Funding may be available from corporate head office to support trials and other initiatives where there are significant company-wide benefits but funds are not available at the site or divisional level, or where a project has application across a number of sites and buildings or across a fleet of vehicles. In some cases, corporate funding may be available through a dedicated energy-efficiency fund
Government funds The federal and state governments provide funds, tax rebates and a range of other initiatives. A list of current government initiatives is available on the programs section of the Energy Efficiency Exchange website (http://eex.gov.au/business-support/programs/)

Where possible, align your efforts with the budget cycle to ensure that momentum is not lost. Where that cannot be done (as described in Box 5), it may be appropriate to make other funds available.

Box 5: Dedicated Energy Efficiency Fund at Centennial Coal

Centennial Coal began energy-efficiency assessments in response to state and federal government legislation. The management team wanted to ensure that their commitment to energy efficiency went beyond identifying projects to practically implementing them on the ground. However, the completion of the assessments did not align with standard budget processes, and this would have delayed the availability of funds to implement projects.

A dedicated energy-efficiency fund was established to overcome this problem. The fund allows energy-efficiency projects to be assessed against other energy-efficiency projects rather than other capital expenditure. The aim is to ensure that these important projects get maximum consideration in the distribution of corporate funds. To date, over $630,000 of funding has been allocated for projects, including waste heat utilisation in bathhouses and power factor correction.

Source: Department of Industry, Business Case and Beyond Project, Canberra, 2011, http://eex.gov.au/case-study/centennial-coal-supporting-project-implementation-through-an-energy-efficiency-fund/

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