Almost £5000. That’s probably about as much as you’d want to spend on electricity for your potato store over an entire season. It’s actually how much a Lincolnshire business could have wasted in one year had it not taken control of its energy costs and acted to make savings.
There was no fancy gadgetry involved, nor has Loveden Estates, near Spalding, suddenly tapped into a golden low-cost energy source. It was simply through installing meters in two of the farm’s stores that the business realised the true cost of the electricity used for the pre-pack crop, and made a rational and straightforward decision about how to make some instant savings.
“It was definitely a big eye-opener to realise just how much it costs to power a store,” notes farm manager Anthony Campling. “We now look at our future sales strategy in a different light.”
Loveden Estates took part in a Potato Council-funded project, carried out by farm energy experts FEC Services, over the 2007/08 storage season. As part of the project, meters were installed in seven commercial stores and the readings monitored. The two at Loveden Estates were a purpose-built potato store, only about five years old with a capacity of 1100t, and an 800t converted grain store. Both are insulated box stores with a target holding temperature of about 2.5-3C. But Mr Campling was aware they performed differently.
“It was always more difficult to hold the temperature down in the converted store during warm weather. We have always tended to outload this store earlier in the season as a result.”
When the first results came through in December, however, the scale of the difference became apparent: The converted store required more than twice the energy per tonne of stored crop of the purpose-built store. During just one month, one store had racked up an energy bill about £500 higher than the other, despite having only three-quarters the capacity. If this had continued over the whole season, Loveden Estates would have spent £4985 more on electricity for the converted store than if the same tonnage had been stored in the purpose-built store.
“When you have the figures, it makes the rational business decision crystal clear. We made adjustments to our contract requirements, shifted some stock around and shut the store down about two months earlier than we had planned. In hindsight it’s probably one of the most valuable decisions we’ve taken.”
So why were the stores behaving so differently? FEC Services’ Jon Swain, who co-ordinated the monitoring work, believes it could have been the nature of the insulation that was at fault. “On the face of it the store appeared to have sufficient insulation on the walls. But the panels were glued and we believe they had parted just enough to let a lot of warm air creep in from outside. You’d be surprised just how much insulation you need for the roof, and the sealing of doors is very important, too.”
The converted store has now been sub-divided and spray-foamed with extra insulation. All the stores across the business have had meters installed that will be monitored. Loveden Estates is also exploring renewable sources to fulfil the farm’s power requirement.
The business will recover capital spent to date in less than three years through lower electricity bills.
The information is also helping to shape sales strategy. A more precise idea of how much it costs to store, as well as the relative efficiency of the stores, is helping the business ensure the best possible net return from contracts. The cost of later out-loading can be quantified, putting Loveden Estates firmly in control when agreeing terms.
“It’s pointless allowing yourself to be locked into a sales contract if the price doesn’t stack up,” notes Mr Campling.
He feels that installing a meter in each store and monitoring energy use is a first step every potato business in the UK should take. But the information you receive is only part of the benefit.
“The key is to be flexible and keep an open mind. If you identify a problem don’t be afraid to step in and do something about it. You’ll have the figures that will tell you it’s a good business decision, and you may be surprised just how big the savings can be.”