BusinessDay

A Look at the energy crisis

The energy cost crisis is currently hitting both residential and commercial buildings and the fear is that the Russian invasion of Ukraine will further escalate the situation as the conflict continues.

While there is an understandable focus on the immediate fuel and diesel cost crisis, an opportunity for long-term solutions is also being reinforced. With millions of people facing real hardship as a result of the soaring cost of energy, no comprehensive plan for addressing a major contributory factor, the poor energy efficiency of our built environment, is in place.

The price of energy has never been this bad but most of the talk about possible solutions either refers to short-term financial measures or very expensive fixes like renewables. One possible solution for energy efficiency is through renovation and refurbishment. Unless facility managers start to tackle the energy performance of both residential and commercial buildings, the energy problem will simply become a bigger one in future.

The impact of the energy crisis on businesses is likely to lead to increased operational and salary costs. The biggest challenge for the service provider side of the market will be the rising costs of overheads which directly impacts their bottom line.

The challenge for staff who are experiencing higher living costs has the potential to cause more people to seek jobs with a higher salary or force some organizations to consider paying more to their current teams to retain them.

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On the client side, the knock-on effect of this energy crisis has to be increased pricing structures to the clients which means a double whammy for them as their service support teams increase prices at the same time as their energy costs rise steeply.

The advice to facility managers looking to mitigate rising costs is to ensure their systems are well maintained. Cost saving to cut back on maintenance will only mean spending far more in the long run.

There are studies that show evidence of good maintenance of HVAC systems and reduce energy consumption by a decent margin. In the same vein, poor maintenance can increase energy consumption by a far greater margin. It is, therefore, important for facility managers to ensure proper maintenance in order to control the energy consumption as much as possible.

The resulting effect of all of the above-mentioned on facility managers is the pressure on their budgets which in turn challenges their ability to continue to provide the same level of service delivery. From the facility manager’s perspective, the challenge will be how much of this can be passed on to the end user and this will surely test relationships.

Concluding, facility managers must do a holistic evaluation of their circumstances in order to take a well informed decision that benefits both themselves and their end users.

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