Energy prices will no longer be low. It is imperative that saving becomes the new normal

Rising energy prices shocked not only households but also companies and public institutions. However, the truth is that energy prices have been low for a long time, which was also pointed out by Marek Engel, an Institute of Environmental Policy analyst. “We were used to low prices, and the motivation to save was not fundamental.” In organisations in the past, energy expenditure was one percent of all expenditures; currently, it is three to four times that. The latest published data show a September year-on-year increase in energy prices by 10% in the housing segment by 21%.

However, it is necessary to consider the fact that pricing is relatively unstable. “These days, we are seeing a slight decline, the weather is helping us and the positive news about how natural gas reserves are. But we have to think about the fact that there are also risks. Suppose the weather changed dramatically, and more natural gas reserves would start to be pumped. In that case, it could once again put significant pressure on the growth of energy prices.” Risks also stem from the geopolitical situation. Although it does not dramatically affect prices, according to Mr Engeľ, physical attacks on energy infrastructure that would significantly cripple our ability to produce energy cannot be excluded. “Economic recession is the essential scenario we are working with,” he added.

In connection with rising energy prices, the state is preparing aid schemes for businesses, households and the public sector. Even though the last few years have been challenging for the public budget, the government has approved an increase in spending for this purpose. It allocated 1.5 billion euros by the end of the year, up to 3.4 billion euros next year. Aid has been communicated so far for businesses for which a ceiling of €199/MWh will be introduced for power electricity and €99/MWh for natural gas. The state will cover 80% of what the company will have to pay beyond this amount – up to a maximum of 500,000 euros per recipient by the end of the year. From 2023 the condition will be adjusted to 100,000 euros per month per recipient. Assistance for households and the public sector will be further specified. Mr Engeľ perceives that it is necessary to help the most vulnerable in this situation but warns that such schemes are not sustainable in the long term. “The state cannot rehabilitate rising energy prices in the long term. In the worst scenario, we expect the impact of this situation on the national economy to be up to 24% of GDP.”

Space for saving is in buildings

Energy conservation must become the new normal. It is in the buildings that we can immediately save on heat. However, this requires denying a certain comfort to the people working in them. “Energy audits confirmed that many buildings are affected. It’s not necessary to have offices heated to 25 degrees,” said Mr Engeľ. There is not as much space with electricity as with heat but turning off unnecessary appliances can help a bit.

A significant part of the buildings has not undergone adequate restoration, so they have worse thermal insulation properties. In the case of older buildings, it is therefore worthwhile in the long term to invest in replacing windows, renewing roofs or exterior cladding, insulating distribution lines, thermoregulating heads, and replacing lighting with energy-saving fluorescent lamps. “I understand many arguments that investments in the energy efficiency of buildings are among the most expensive. But the higher energy prices are, and we will have to put up with this in the future, the shorter the return on investment. I believe that this will be a motivation for many,” concluded Mr Engeľ.

ČSOB headquarters is a unique green building

For ČSOB, environmental protection is one of the priorities in the social responsibility framework. Since 2012, they have implemented ISO standards to help the bank achieve carbon neutrality by 2050. The most significant step in this area was constructing a green building as the bank’s headquarters in Bratislava, which in 2017 received the BREEAM certificate with an Excellent rating (81.4%). “This certificate is valid for ten years, which means for us that we have to constantly improve in this area to be able to obtain it in the future as well,” said Juraj Kaba, manager of the investment development and building management department at ČSOB.

The building has several innovative features. One of them is adiabatic air humidification, which means they do not humidify the air by producing steam. Still, the system mechanically atomises the humidity into microdroplets. It is a unique facility that is not operated in any other building in Slovakia. Others include air recovery and an automated system for moving exterior blinds. The entire building is managed through the so-called building management system. It is computer intelligence that constantly analyses the state of the building through hundreds of metres and regulators and adjusts individual operations, such as air conditioning, boilers and cooling machines. LED lights and motion sensors on the stairs and toilets are also a means of saving.

J. Kaba emphasised that the operation of such a green building requires strengthening the function of its administrator. “You need to have a strong technical administrator because it is not common for a management company to have a team of people who can analyse such a building.” ČSOB data confirms that the green building fulfils its purpose. Compared to its older buildings, the bank saved 60% in gas and 50% in electricity consumption. Only the water consumption used for watering the green roof is higher.

How does green energy work?

Green energy is produced from renewable energy sources, and its production must be emission-free. Regarding physical potential (water, sun, wind, geothermal energy), water is the best source of energy in Slovakia. Still, at the same time, it is largely exhausted, as there are no plans to build hydropower plants in Slovakia in the coming years. Solar energy also has high potential in our country. “If 60% of businesses had at least a small photovoltaic system on the roof, its production would cover 10% of the annual consumption of the corporate sector,” said Jana Kurucová, ZSE product manager.

Green energy also has commercial potential from the point of view of trading with guarantees of the origin of electricity. The guarantee of origin is a certified document that confirms that a given share of electricity consumption in the entity to which the guarantee was assigned was covered by electricity produced from renewable sources. The price of these guarantees is currently on the rise because there are not enough of them to satisfy the demand, and that is the determining factor of the cost. Guarantees of origin can be another source of income for businesses. If they produce electricity from renewable energy sources, they can sell it and trade with guarantees of origin.

The demand for green energy is growing in the household and business sectors, but the motivation is different. In the case of households, they are most often concerned about rising energy prices and striving for energy independence. Their ecological mindset is also an essential factor. The motivation for companies is often relief on consumption tax, the cost of energy and, in the case of large companies, ESG reporting.

Adient communicates the need for savings through an internal campaign

Adient is based in leased premises, so it has limited options to influence how heating or cooling is done. To generate actual savings in the shortest possible time, they focused on operational interventions that are primarily related to the education and information of employees.
At Adient, the Think and Act campaign is underway, motivating employees to behave ecologically and sustainably. The company communicates these principles at all levels. The top management presents sustainability topics which are part of quarterly meetings. They are transmitted through corporate social networks and email communication. Concrete energy-saving tips are placed in the form of posters and TV presentations on the company’s premises. Possibilities of how to reduce energy consumption are also covered in online courses. “We motivate employees to start acting consistently so that they are aware of the issues of savings and sustainability and able to find the potential for savings in any environment,” said Peter Vodráška, Facility and HSE Manager at Adient.