Eskom's potential penalties - should you care

Posted On Wednesday, 15 July 2009 02:00 Published by eProp Commercial Property News
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With Eskom’s mooted penalties for shopping centres that don’t reduce consumption by 20%, pretty much all of us should care...

Eskom...and in particular if:

  • you’re a relatively energy-intensive business like fast food or a supermarket, or
  • you trade very long hours, or
  • if you’re in a centre that has high-energy users like the ones mentioned above.    
     

Centers are often default suppliers of electricity on behalf of municipalities which don't want to deal with billing/collection complexities, and the question is "how will they apportion penal tariffs?", should they be unsuccessful in dropping consumption enough across their entire centre.
 
Given the enormity of the 20% reduction Eskom has alluded to, this will be a big ask in the first few years, and targets will inevitably be missed.

In this potentially penal environment, even if your own store is the very model of eco-friendliness, should neighbouring retailers not make the same effort, or not achieve expected (good) results, or not be able to implement savings initiatives soon enough (e.g. retail chains with 100’s of outlets won’t be able to implement savings initiatives over-night across their portfolio), you stand every chance of paying the same penal rates that they incur.
 
1.   Get it in writing
So you need to amend existing lease language upon expiry and for all new leases to cover the eventuality where you have met your savings targets, but the centre hasn’t. You don’t want to be in the position where you’ve invested time/money to achieve your specific savings but still pay a penal electricity tariff due to neighbouring tenants’ efforts (or lack thereof).
 
2.   Get started
Even if you don’t have the budget of a listed giant, with their specific sub-committee dedicated to cutting consumption, you do need to get started – get informed on what can be done and when it should be done. Get hold of the Facilities Manager of your landlord – they’ll be at the centre of savings initiatives - and squeeze them for info on the intititives they're already implementing and see if you can piggy-back on their connections and experiments in what produces the most cost-effective savings.



Last modified on Wednesday, 21 May 2014 22:15

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