Energy Costs

A Guide on Calculating Energy Costs When Starting A Business

Err On The Side Of Caution

There are a lot of unpredictable expenses for a business, large or small.

What you want to do is give yourself a generous margin of error on either side of “homeostasis”, if you will.

“Homeostasis” in business would be where what you spend to maintain operations is continuously overcome by what you earn, and there’s a slight increase in profit going forward.

If you’re not expanding, you’re contracting.

There’s no real “treading water” in business.

Inflation is always taking place, technology is always moving, cities are expanding, and a business that’s just making ends meet and nothing more is, in reality, one accident away from bankruptcy.

It may not look exactly like that on paper, but that’s the bigger picture.

It’s important to get your infrastructural “overhead” costs lined out in a definitive, straightforward, dependable manner.

You need to have a bottom line that you can depend on in terms of cost, then surround that with error margins for Factor X.

Following, we’ll go over a few items of overhead you’re likely going to need to consider in calculating energy costs.

On-Site Or Off-Site Infrastructure?

Ten years ago this option wasn’t on the table, but today you can outsource your workforce.

This will only apply to certain businesses. You can’t outsource clerks at a grocery store; the best you can do is buy an automated checkout apparatus, and for a small grocery store, that’s practically inviting theft.

But a tech company full of coders can outsource all but management via BYOD.

Bring Your Own Device allows employees to bring their own tech “tools” to the “job”.

Since the “job” is primarily digital, and can be conducted over the web through cloud computing network access—with full monitoring capability—employees don’t necessarily need to be on-site. You don’t need to have a parking lot, a building, or cubicles.

You don’t need to have on-site server arrays or spend money on laptops.

All the electricity involved in an on-site operational paradigm can totally be sidestepped, saving you tens of thousands a month.

So determine whether the infrastructure of your business will be on-site or off-site. Once you know the answer to this, calculate your energy costs in terms of utilities.

A good plan might be investigating various utility options through Texas Electricity Plans (for electricity rates in Irving, Texas).

Here you can figure out what exact expenses on electricity in Irving will be, allowing you to make projections that are to the decimal point.

Once you’ve got the projection, add margins for error, and you’ve got one category figured out.

Scaling Out

Energy Costs

What level of scale-out do you expect, and how can you apportion resources that direction?

Because a business isn’t static, you’re going to have to expand at some point, and you want to build in certain costs like marketing, advertisement, and scale-out into overhead—as it’s possible.

Startups are seeking homeostasis first, but a future “vision” is still necessary.

Alternative Options

Next, look at sustainable, alternative, renewable energy.

There are ways to generate energy locally in a way that nearly closes the loop of cost.

There are some buildings decked out in solar panels and wind energy.

Such buildings have a footprint of essentially zero, and generate their own energy.

Generally totally sustainable buildings are larger structures, so this may only be an option for big businesses.

Still, it’s not impossible. You could use solar, wind, or water energy options for your business, with general grid energy as a backup, and that may defer the expense of energy substantially.

However, as yet, this isn’t totally feasible for most businesses.

Reducing Expenses In Energy

At minimum, your solar energy option can pay for itself and increase property value of the structures you optimize this way.

There are lot of means to determine what energy needs will be.

Calculate basic costs, including potential scale-out, add a margin for error, and explore alternative options to get the most sustainable energy for operations at the least cost.