A prominent steel fabricator, engaged E3M Solutions to help them address a significant opportunity for tax savings linked to energy usage in their manufacturing operations. Given the nature of the production process, the company was aware that the bulk of their energy consumption stemmed from production activities which are eligible for tax exemptions. 

With high energy costs impacting overall operational efficiency, the customer sought to minimize their expenses through potential tax savings on energy used in manufacturing. Moreover, the company recognized that they could be eligible for refunds on taxes paid over the previous four years, and they desired to set a strategy that would remain valid for tax purposes for the next four years. To pursue this, they needed a comprehensive understanding of their energy consumption patterns in relation to their production processes. 

E3M Solutions employed a systematic and methodical approach to derive insights into the customers energy usage: 

1. Predominant Use Study: E3M began by conducting a detailed predominant use study, which involved categorizing the building into production and non-production areas. This allowed for a clearer understanding of how energy was consumed within the facility. 

2. Data Collection and Analysis: 

– Utility Bill Analysis: E3M’s team analyzed current and past utility bills to determine energy costs and consumption trends. 

– Reviewing As-Built Drawings: This helped understand the layout and functions of different areas within the facility. 

– Temporary Power Metering: E3M installed temporary power meters to accurately capture energy consumption data over a defined period. 

– Facility Walkthrough: A thorough walkthrough was conducted to visually assess energy usage patterns and processes. 

3. Calculating Energy Consumption: Using the data gathered, E3M applied engineering calculations to ascertain the proportion of energy consumed by production activities versus non-production activities. 

At the end of this comprehensive process, E3M Solutions delivered: 

– A detailed report encapsulating overall energy consumption and breaking down energy used in production (tax-exempt) against that used in non-production areas. 

– A completed tax exemption form, ready for submission to the utility provider, enabling the customer to pursue their tax savings efficiently. 

As a direct outcome of E3M’s work, the customer gained valuable insights into their energy consumption, which led to the identification of six-figure tax savings that they could not only apply moving forward but also claim retroactively for the last four years. This initiative not only mitigated operational costs but also improved their bottom line, affirming the importance of strategic energy management in manufacturing settings. 

E3M Solutions exemplified its capabilities through a collaborative and thorough analysis of the customers energy consumption. The project not only highlighted the potential for substantial tax savings but also reinforced the value of conducting regular energy assessments. 

By choosing E3M, the customer positioned themselves for long-term financial benefits and operational efficiencies. 

Learn more about predominant use studies HERE

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