Cold Link Africa May 2020 | Page 4

NEWS
INCORPORATING COLD CHAIN
Energy Partners
Cooling as a service
reduces risk
as businesses recover from
With companies around South
Africa moving between
lockdown stages to full
operation, addressing profit margins are
going to be top-of-mind for business
owners for some time.
The country has already sustained
significant financial setbacks as a result
of the current five-week COVID-19
lockdown. For companies with
processes that rely on refrigeration,
switching to outsourced refrigeration
or cooling as a service (CaaS) can be
a meaningful step towards recovery of
the business.
This is according to Cala van der
Westhuizen, Head of Sales at EP
Refrigeration – a division of Energy
Partners and part of the PSG group
of companies. Van der Westhuizen
says that the COVID-19 pandemic
and the current nationwide lockdown
have forced many businesses to
re-evaluate their largest cost drivers.
“For refrigeration-heavy operations,
cooling is a significant cost factor
that is going to become much more
difficult to bear.”
Handling the purchasing of cooling as
a service has multiple solutions, none
of which hold a capital investment for
the client.
COVID-19 lockdown
By Energy Partners
He notes that companies now need
to put aside much more capital for
unexpected additional costs, and
there are still numerous challenges
that lie ahead. “Switching to CaaS
removes the need for capital
expenditure while ensuring the lowest
and predictable operational cost
for cooling possible. Our clients only
pay for the cooling they need at a
guaranteed price.”
Van der Westhuizen explains that
CaaS is very similar to the Power
Purchase Agreement (PPA) that many
businesses have already become
familiar with. “The service provider
acts as the owner of the plant and
sells the utility produced (refrigeration,
in this case) at a guaranteed
competitive cost. For a business that
wants to switch to purchasing cooling
as a service, rather than operate
their own plants, partnering with a
company that can offer this can take
one of three forms. You could build
a new state-of-the-art refrigeration
plant on the client’s premises, you
could upgrade the client’s existing
refrigeration plant, or you could
simply take ownership of the client’s
existing plant.”
The one thing that each of
these scenarios have in common,
according to Van der Westhuizen, is
that it does not require any capital
investment on the part of the client.
“We would take on all of the cost
and risks associated with running
and maintaining the plant. For the
past five years, we have been one of
the foremost pioneers of CaaS both
locally and globally.”
To this, he adds that a capable
CaaS provider also plays an important
role in improving overall cost
efficiency – the CaaS product plays
a significant role in improving up-time
and temperature compliance. This
improves product quality and reduces
waste. “By allowing a company
like ours to design and invest in
the plant, the client is assured that
the best technology is installed to
ensure optimal efficiency (which is
guaranteed throughout the lifecycle
of the plant). By improving overall
efficiency, the energy cost (which is
the biggest cost of running a cooling
plant) and maintenance costs are
reduced. As the service provider
guarantees the cost of cooling, the
business is also reimbursed for the
electricity used by the plant while only
paying for the actual cooling used.”
One client that can attest to this is
Lynca Meats CEO, Brent Fairlie. “Our
operation consists of 28 temperatureregulated
rooms that run 24 hours
a day. Managing the refrigeration
requirements of a facility of this
scale had become increasingly
time-intensive, requiring specialised
knowledge. We realised that handing
this managerial responsibility over to
outsourced specialists would therefore
be in the best interest of the business,
as it would allow us to focus solely on
the company’s core activities. This
decision paid off almost immediately
after the new installation concluded,
with our business achieving a
30% reduction in the cost of our
refrigeration”
There has never
been a more
important time to
simplify operations.
With companies being under pressure
to recover and adapt to an entirely
new economic landscape, Van
der Westhuizen says that there has
never been a more important time
to simplify operations and improve
cost efficiency. “Whether it is food
production, retail, farming or any other
business, now is the time to focus on
the company’s core skills, while putting
essential utilities like refrigeration in
the hands of experienced service
providers. EP Refrigeration supplies
direct support services to companies
which qualify as essential services and
it is our duty to continue to support
these essential parts for our economy
and our country. Energy Partners
is powered by results and our core
service support teams will continue to
operate,” he concludes.
CLA
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www.coldlinkafrica.co.za COLD LINK AFRICA • May 2020