Energy management for business profitability

Invited by the Postgraduate Institute of Management Alumni, Energy Consultant Dr. Tilak Siyambalapitiya addressed the issue of energy management with regard to consumers and producers.

He outlined the various uses of electricity, especially in the three main sectors of households, commercial and industries. Compared to years past, he demonstrated how there has been an increase in power consumption in the commercial sector and a significant decline in power consumption in the industrial sector which is a reflection of the current state of the economy.

“The production of electricity is a business, we should treat it like one,” Siyambalapitiya stated, adding that in Sri Lanka, consumers tend to take such services for granted.

Even though much has been said about the high rates on electricity in Sri Lanka, Siyambalapitiya showed through a comparative graph how we measure up in a global scale, surpassed by countries such as Singapore and leading over countries with a less developed electricity system such as Bangladesh.

However, he pointed out that we are currently running at a loss since production costs are astronomically high. On the whole, the electricity sector is managing their losses as best as they can and hope to make a sufficient dent in the process by 2015.

The energy policy means that oil powered plants will be gradually phased out, replaced by coal burning plants which are more cost effective. This in turn, he stated, will most likely regulate the price per unit of electricity, passing the benefits on to the consumer. “This however has its positive, negative and neutral implications, but the industry is moving in a reasonably good direction,” he said.

Considering a buzz word in the industry, both local and global, Siyambalapitiya stated that ‘renewable’ does not necessarily mean ‘cost effective’, the establishing of a renewable energy source being considerably more expensive than its subsequent output.

However, he added that the concept of ‘net metered’ energy was a innovative and successful concept in Sri Lanka, where an establishment or household interested in the idea of renewable energy may produce it themselves, with the help of necessary equipment, where the excess can be traded to and from the grid without any monetary transaction.

Even though the time of use pricing, where the price per unit varies according to the time of day, is optional at this time, Siyambalapitiya said that in time, especially with the new power plants coming into being, the price of electricity will be more regulated and in time, prices will reflect the cost and that the subsidy/surcharge will be reduced.

Regulatory initiatives have already been drawn up and soon everything from light bulbs to televisions will be rated on a star system on terms of energy consumption, giving consumers the tools to make an informed choice about the appliances they purchase for their home.

He added that these types of regulations mean that there is a large potential for suppliers, users and the public use of electricity. He stressed on the need for a proper street lighting system, where there are measures to ensure that they have proper coverage, are energy effective with no wastage.

Siyambalapitiya also presented various ways in which consumers could reduce the amount of energy that is used in homes and offices, with measures such as task-oriented lighting and comfort, where CFL bulbs and wall and table fan are used instead of the traditional method of lighting and high energy ceiling fans. He also presented tips and ideas for other appliances such as televisions, heating and refrigerators.

The demand profile for consumers also showed the unhealthy usage patterns throughout a typical day, with an unhealthy spike in the evening, when people are at their leisure. He stated that by practicing good energy habits, we would be able to regulate this pattern and save more energy, adding that by saving water, we are making a substantial change in the amount of power we waste. Siyambalapitiya added that the Water Board in Sri Lanka currently spends a proportionately excessive amount of money on electricity costs alone, hence by saving water, we will be saving electricity.

Siyambalapitiya also presented graphs of various industries demonstrating their energy consumption over a period of time. It also showed that energy intensive industries were also the high value adders to the economy, which means that their energy use must be regulated in order to cut down on overheads. He stated that by using these graphs, companies and industries will be able to better manage their electricity consumption in order to save on costs and increase productivity.

He added that in order to establish an effective electricity system in the country as well as develop good energy management practices, actions such as good metering, the hiring of competent staff, training in energy management and promoting awareness through campaigns and competitions were important factors that needed to be looked into.  Overall, his outlook on the sector was positive and that with the necessary changes; Sri Lanka would be able to fully benefit from the industry as suppliers as well as consumers.

The session was moderated by Dr. Bandula Perera (Managing Director – Samson Rajarata Tiles Ltd.) and the panellists included Prof. Ranjith Perera (Professor – Electrical Engineering) and Sunil G. Wijesinha (Managing Director – Dankotuwa Porcelain PLC).

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