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Cost savings and operational efficiency: Energy management firm helps SMEs reap benefits of decarbonisation

For small and medium-sized enterprises (SMEs) anywhere in the world, adopting sustainable practices can be time-consuming and costly. But now, in Singapore, there is help. 

In line with the Singapore Green Plan 2030, Schneider Electric’s SME Kickstarter Decarbonisation Programme was created to make it easier for Singapore SMEs to embark on their sustainability journeys and build capabilities to decarbonise, or reduce carbon emissions in their operations.

The Programme is supported by Enterprise Singapore under the Enterprise Sustainability Programme (ESP) which facilitates various projects via the Enterprise Development Grant (EDG). 

This makes it more affordable for SMEs as they can receive up to 70 per cent support on sustainability-related scopes. It is also a more seamless and less onerous experience for the participating SMEs as they do not need to deal with a lot of paperwork in order to take part in the programme, which is led by Schneider Electric.

When Seng Heng Engineering (SHE) decided to go green two years ago, the company struggled initially due to a lack of expertise. By participating in the SME Kickstarter Decarbonisation Programme, however, the road towards decarbonisation has started to yield several positive outcomes.

SHE’s managing director Jackie Lau says Schneider Electric was swift to identify parts of its operations that could be retrofitted to boost efficiency and reduce costs. 

“We were frankly very surprised by the amount of savings that were reaped from easily implementable retrofits to the existing air-conditioning and lighting systems. Altogether, we made an investment of around $100,000, but the maths proved the investment was worth it, financially and environmentally,” says Mr Lau.

Tailoring solutions to meet sustainability goals

While Schneider Electric is a multinational company (MNC), it is nevertheless cognisant of the priorities and concerns of SMEs. 

“We understand that SMEs are highly cost-conscious and face challenges in making big investments that require long-term implementation before benefits can be realised,” says Mr Yoon Young Kim, Schneider Electric’s cluster president, Singapore and Malaysia. 

A third-generation family business, SHE manufactures critical API-certified fasteners, mainly for the oil and gas industry. Recommendations by Schneider Electric – a specialist in digital technologies and energy management – to retrofit SHE’s air-conditioning and lighting systems translated into an almost immediate return on investment. 

“It was crucial that the changes we recommended had beneficial, tangible and close-to-immediate results,” adds Mr Kim. 

Small but in step with the times

Under its programme, Schneider Electric mentors and trains SMEs over a three-year period. Workers learn about sustainability and how to track emissions in particular, while acquiring expertise on decarbonisation and efficient energy usage. The knowledge transfer of digital solutions also helps SMEs grow their digital talent. 

Without prior knowledge or experience, SHE found Schneider Electric’s three-step approach easy to understand and follow.

“We particularly appreciated Schneider Electric’s robust network, which was a one-stop shop for advice on sustainability, from ideation to implementation. We were involved in multiple projects requiring proof that we were greening our processes, and the company played an instrumental role in guiding us on the steps we could take,” explains Mr Lau.

The collaboration underscores how SME-MNC partnerships are key to accelerating Singapore’s Green Plan 2030. Under this nationwide initiative, one of the goals is to make local industries more energy and carbon efficient. Through its programme, Schneider Electric brings onboard smaller businesses that otherwise would not consider going green, due to lean resources, priorities on bottom-lines, or simply a lack of awareness and know-how. 

SHE embarked on its journey when several clients were decarbonising and looking for like-minded suppliers to collaborate with.  

Empowering workers for a green future

As an SME, SHE is keen to explore avenues for growth, including the expansion of its factory capabilities. 

But the company is equally concerned with upholding environmentally-sound operations. Mr Lau stresses that “growth should not come at the expense of the environment”.

The company has made a commitment “to achieve 50 per cent energy cost savings by 2030,” he says.

SHE has also installed Schneider Electric’s EcoStruxure Energy Hub, a cloud-based software solution to enhance energy management.

While carbon reporting is not yet mandated for SMEs, this practice can ensure that companies are on the right path towards sustainability. Indeed, preliminary reporting was useful in facilitating SHE’s application for government grants, such as the National Environment Agency’s Energy Efficiency Fund. 

It also helps SHE to attract listed, large and multinational companies that are also looking for greener partners as part of their supply chain decarbonisation efforts.

More importantly, embarking on the decarbonisation process will equip SHE employees with in-demand skills for the expanding green economy, and inject a sense of purpose in their work. “They are playing an active role in a bigger cause,” Mr Lau says.

Mr Kim adds that by focusing on its workers, SHE is “priming its workforce to capitalise on the green economy”. He observes that there is currently a deficit in credible green talent, and ensuring a steady supply of such talent will aid Singapore in achieving its sustainability goals. 

SME Kickstarter Decarbonisation Programme at a glance

It is a three-step approach over three years:

The first stage helps SMEs track emissions and draw up decarbonisation roadmaps.
The next stage monitors energy usage to identify cost-saving opportunities.
The final stage sees implementation of more efficient operations, such as electrification or switching to other sustainable energy sources.

Visit this website to find out more about Schneider Electric’s SME Kickstarter Decarbonisation Programme.

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