South African retailers looking for ways to recover from the latest lockdown, as well as recent countrywide looting and vandalism, may welcome the opportunity to cut costs on the system that makes up the bulk of their energy spend – refrigeration. The initial outlay of refrigeration machinery as well as the ongoing cost of maintaining depreciating equipment increases year-on-year, to the detriment of the bottom line. A solar-assisted refrigeration system coupled with an outsourced “cooling as a service” (Caas) contract provides an innovative, cost-cutting solution.
All food retailers rely on refrigeration and are compelled to spend a lot of time, money and finite resources on managing these systems internally. But new, ground-breaking technology and the emergence of a pay-per-service model for clean cooling is changing the status quo. Dawie Kriel, Head of Business Development at EP Refrigeration – a division of Energy Partners and part of the PSG group of companies explains: “With a refrigeration system, there’s scheduled maintenance to coordinate, emergency maintenance in the event of a breakdown or leak, constant monitoring and risk management to consider. Added to this is the inevitable increase in the cost and consumption of energy as well as the cost of wear and tear. With the right financing strategy and support, these infrastructural problems shouldn’t have to cost business owners valuable time and effort.”
He adds that relying on inefficient, aged systems doesn’t help either. “Most of the systems in operation today are between 10 and 20 years old – which means they are no longer operating at peak efficiency. Replacing them usually requires massive capital expenditure, so we are seeing a vicious cycle of annual losses, because any gas leak or systems outage results in wasted electricity and stock losses.”
The solution, according to Kriel, is to partner with a refrigeration expert that can take on the responsibility for the entire cooling chain process. “This is what we mean when we refer to Cooling as a Service (CaaS). Servitisation is a growing global trend and has become one of the most viable ways for businesses to save on capital and operational costs. In a CaaS scenario, a business does not own any of the refrigeration infrastructure on its premises. Instead, a service provider installs a state-of-the-art system and sells them the cooling service at a competitive guaranteed cost. Maintenance, monitoring and efficiency risk responsibilities are all outsourced so life cycle costs decrease drastically. Retailers pay for only the cooling that they use – that’s it.”
There is also the question of efficiency, to which Manie de Waal, CEO of Energy Partners Solar proposes, “connecting a grid-tied solar generation system to your refrigeration system, because these systems consume the bulk power during daylight hours.” This solar power can also be integrated into the CaaS outsourced model.
Reducing the cost and management time involved in cooling for one’s retail business, may be one of the best decisions to make this year. “The future of business is all about implementing the best efficiencies. We can think of nothing more efficient than state-of-the-art cooling powered by cutting-edge renewable energy technology,” says De Waal.