Is there is a real desire to act?
October 1st 2006

There are energy efficient solutions out there now that can improve businesses competitiveness and contribute towards our nation's green commitments says Steve Ruddell , general manager,Drives and Motors,Automation Products at ABB and new ABB spokesperson on energy.Tim McManan-Smith spoke to him and found that the Government could do more to help and that we can act now

ABB has a corporate position that takes energy efficiency seriously. It accepts the Kyoto protocol and the assertion that carbon causes global warming and that humans that are affecting the balance. On top of this the corporation believes that we have a responsibility to do something about it. ABB has appointed Steve Ruddell as its UK energy spokesperson to help highlight this important issue across all five divisions of ABB.

The Government tries to make energy efficient products more appealing through the Enhanced Capital Allowance (ECA) scheme and the energy technology list (ETL) that supports it. Ruddell's opinions of this as a mechanism for supporting the uptake of energy efficient products he thinks that the "theory is great but the execution is poor"."There is not enough of an incentive.The amount you get back is too low and blue chip customers that we speak to, let alone SMEs, say that it costs more to claim the ECA in time spent filling in forms and difficulty getting together all of the required information that it is not worth them doing it."

ABB was asked to have an input into the development of the ECAs and the ETL and worked with ETSU on the need to bias the scheme towards retrofit;by far the best way to achieve significant energy savings throughout industry because the installed base is so much larger than the market for new installations.Sadly this was ignored,"There is more incentive to buy new products than retrofit because the installation costs.

Incorporation costs are able to be claimed back through the ECA scheme for new installations but not retrofit and the reason the Government/Carbon Trust has given for this is that it would cost too much money to write capital allowances for such a large amount of equipment.

But this is what the climate change levy money was meant to spent on! I don't believe that the Climate Change Levy is revenue neutral as the Government said it would be, it is a tax on industry at a time when it could really do without it.With the complexity of claiming ECAs, the amount of money you get back and the lack of support for retrofit projects you have to question whether they want people to take up energy efficiency en masse."The aim of these schemes seems to be the fact that the Government is able to say that it is doing something while not actually having to bear the costs (that we are funding) for a true energy efficiency revolution."The Climate Change Levy is a hidden tax, not a heartfelt intent.

One way of offering better encouragement might be to raise the bar of what is on the ETL and for those companies going for these premium energy saving products they get a proper incentive i.e more money and on the whole project.This additional carrot would promote the very best products which is surely what the scheme aims to do?"

The Government can help; either by education of legislation, naturally they go with education."The fact is that the Government is not walking the walk. I am waiting for someone to stand up in parliament and say that we will not meet our Kyoto commitments.With regard to the Government's chosen vehicle for implementing energy efficiency for non-domestic users,The Carbon Trust,Ruddell again has believes that things could be improved."There is no quantitative analysis of The Carbon Trust,where it spends its money and so on. For instance the Carbon Trust doesn't promote ECAs, we [the industry] do. ABB itself has spent in excess of £1m on seminars, advertising campaigns and direct mail. I don't believe there is a real desire to act, if there was, rather than just educate, the Government would legislate and make low efficiency products illegal.Compare this to the situation in the USA where they have done this, yet we in the UK criticise their attitude towards energy use," comments Ruddell,"The Government is quick to tax but won't legislate, it says it would harm the UK economy, yet it would do opposite."

The products are here "People now associate being green with the bottom line, this was not so 10 years ago.Never mind the green issue, if this isn't on your agenda then you've got problems,"says Ruddell with reference to the high price of energy in the UK. Much talk is spent discussing the future and what we can do about reducing energy use and combat global warming.Renewable generation, whether to use nuclear power to plug the carbon-free generation gap and what new technologies lie just around the corner.This irks Ruddell as he believes that there is already enough good technology to change the way we run businesses."Right now,we [the industry and not just ABB] have a large range of products that can reduce energy use,we don't need to look to the future.We need to educate users in how to consume less energy in the short term.

Business has to be more cognisant of how to use energy to achieve better productivity by using less energy." The cost of a motor will be used in energy within one month of use and for £1 spent of the motor it will use over £100 in energy over its life.With facts such as these (worked out 2 years ago, so with energy costs so much higher now these will be even more impressive) there are huge savings to be had from simple replacement programs.When one considers also that 65% of all energy use by industry is by motors, the savings are staggering and this is without taking into account the savings achieveable with motors that do not need to be running continuously.Variable speed drives (VSD) can solve this problem and lead to even larger savings.

"When we go to a customer and suggest that they implement VSDs and high efficiency motors the swift payback period often works against us.They think that it is a salesman's trick, too good to be true. So we have started to loan drives to prove our point.We do this for free and then when we come to remove them they are often not prepared to let them go until we install a new drive into their process.We have started to rent them as a stop-gap until the new drives are ready for installation." "We are increasingly experiencing a better response from the board.

Controlling costs is something that the board does and energy is now a valuable commodity. It is being 'driven from the top', but that is not to say that it has proper representation at this level only that it is recognised in a way it wasn't in the past, says Ruddell.Many companies coming appreciate the advantages of looking at lifetime costs instead of just capital expenditure. ABB offers a pay as you save scheme, this can overcome problem of having the capital ready to spend on energy efficient improvements. So there really is no excuse to not start making serious energy savings today.

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