Case Study 1

Chad Pty Ltd (CPL) is preparing to design and implement sustainability systems and processes. You find (as the environmental director) that energy is a key resource for business operations; first for heating water and second for operational and security lighting. Management of these key resources for business operations can save the company money. Therefore the first step is to measure the water flow at the premises and the second step is to calculate the cost of heating water for 250 days each year. The second key resource for business operations is energy for operational and security lighting for 365 days each year. You report directly to William South, the CFO.

The daily rinsing process for fruit and vegetables requires the tap to run for 40 minutes per day and use 11 liters of water flow per minute. The water is heated to 60^oC. The table below provides the number of kWh required to heat one kilolitre of water to various temperatures

Hot Water Temperature	kWh required to make one kilolitre of hot water
45oC	56 kWh
50oC	62 kWh
60oC	77 kWh
70oC	98 kWh

CPL electricity usage for lighting for operational and security purposes is set out below.

Number of lights:	12 lights
Light Wattage per light: (Fluorescent lights)	40 watts or 0.040 kWh Light Wattage:
Electricity cost per kW Light Wattage:	$0.25 /kWh:
Hours of lighting use per day:	18 hours

Required: Please note: all your answers should be to two decimal points (cents)

a. If the business uses water heated to 60^oC, assuming the electricity cost per kilolitre is $0.25 per kWh, calculate the annual electricity cost to the business associated with the heating of water used to 60^o

b. If the business uses water heated to 50^oC (assuming the electricity cost per kilolitre is $0.25 per kWh), calculate the dollar saving if this lower temperature is used.

c. You are considering fitting the tap with a flow restrictor that will reduce water flow to 5 litres of water flow per minute. You expect run the tap still for 40 minutes per day. Calculate the electricity cost if the reduced water flow was heated to (i) 60 degrees and (ii) to 50 degrees.

d. Using your working to answer (a), (b), and (c), calculate the energy cost savings from (i) reducing the water flow without reducing the water temperature and (ii) reducing the temperature without reducing the water flow.

e. Calculate the annual lighting cost for the Arrow Pty Ltd using the following formula

__ lights x ____ kW x _____ $/kWh x ____ hrs x _____ days = $______/yr

f. How much can a business save on electricity costs by using energy-efficient lights if the business replaces the 40-watt fluorescent tubes with 5 watts LED bulbs that could be inserted into 20 light fittings? Each light fitting costs $5 to supply and install.

g. Provide your recommendation(s) to the managing director about what energy reduction activities to implement. Use your answers in a) to f) to support your recommendation to make the greatest combined energy costs savings. Include capital costs (mentioned in (f) above) of installing new light fittings if your calculations show that is the best option.