The Energy Chronicles

Maximize Profits for your Agricultural Operation with Energy Efficiency

The key to maximizing profits for your operation is to reduce expenses. There are many ways this can be done, but one of the best and most predictable ways is to lower your production costs by improving the energy efficiency of your operation. Production costs are part of doing business and whether you grow row crops or raise livestock, production costs are always there. So anytime costs can lower, the savings go directly to the bottom line. Read on to learn more about four ways to save energy on your farm as well as how you can get funding to reduce the initial investment cost.

LED Lighting

poultry barn red led light

Many benefits of LED lighting are widely known at this point.  Compared to CFLs, LEDs use half the electricity, last up to 5 times as long, and provide more control over the color and brightness you desire.  Did you know that selecting the correct color of light can increase the health and production of your livestock?

When looking at the color of lights in a poultry barn, green light significantly increases fowl growth rate at an early age.  Blue light increases growth at a later age, while also having a calming effect and improving feed conversion by up to 4%.  Red light can be used to improve egg production while also reducing food consumption.

It’s easy to see why LED lights have been taking the lighting industry by storm.  The cost savings alone are generally enough to justify the investment.  On a farm, the benefits are even more significant with how much less maintenance they require and how they can improve your overall production.

Efficient Water Heating

horse drinking water

On the farm, most energy used to heat water is for clean-up and livestock watering systems. Both benefit from efficient design and eliminating leaks. Natural gas or propane may be more cost-effective than electricity for heating hot water. Not because of efficiency, but due to the energy cost. Water conservation is an inexpensive way to reduce your water heating costs. When purchasing a new water heater, do not look only at the efficiency number. Check the estimated cost to operate each year on the energy guide label. This cost includes the cost of natural gas, propane, or electricity along with the insulation loss during standby.

Keeping the drinking water in a livestock watering system from freezing is critical. And often critical needs end up wasting energy if you use the old methods. The old way of doing things meant you could use a lot of energy because electricity, propane, and gas used to be very cheap. With today’s energy prices, a better livestock watering system is worth the extra cost. Automatic waterers and water tanks can be purchased with better insulation and float design. You also need to keep the float valves in good operating condition to reduce leaks. Fewer leaks also means less ice and mud around the waterers. Energy-free waterers are available that cover the water surface with lids or small openings to reduce heat loss. Reducing the heat loss along with great insulation means no energy is needed to heat the water. Some units are rated down to -20°F! A side benefit is they stay cooler in the summer as well.  

Saving energy for water heating at a dairy farm (or any farm) can be as simple as (1) using warm or cold water when possible, (2) reduce how much water is used, and (3) use efficient water heaters. Hot water is needed for washing the system, tanks, and dairy parlor equipment. While you’ll often see 165° hot water in use for clean-up, it’s not always necessary. Dropping this temperature to below 130° will demonstrate immediate savings. The acid rinse does work better at higher temperatures, but the contact time is often long enough at warm temperatures. Just check your acid label for contact time at warm temperatures. Using too much pressure/flow of wash solution through the milking units for cleaning should also be avoided. During parlor clean-up use a power washer that’s high pressure, but low volume and use the hot water sparingly. Watch for dripping faucets and leaking hoses as well. Waste not, want not as my mother used to say. Check the energy guide label if you select a residential size water heater. If you need a commercial water heater, as is often the case on a dairy farm, then choose one with high thermal efficiency and low standby loss. A gas water heater with a thermal efficiency of 90% and a standby loss of around 1% is the typical sweet spot for savings vs. cost. If you need an electric water heater, look for a heat pump water heater as these are very efficient. 

Electric Motors


Motors can be one of the most energy-using devices on the farm, and a new efficient motor provides energy savings day after day. Today’s electric motors are much more efficient than their older counterparts. The efficiency standard changed about 8 years ago, but motors last a long time or are rewound to save money. Even a rewound motor may have less efficiency than the original if best practices were not followed. A new motor measuring 10hp or less, rated as NEMA Premium® or better, can offer efficiency gains of 4-8 percent over antiquated motors.

Efficiency comes from better materials. New motors often use better grades of electrical steel, and copper wire is larger in diameter for reduced resistance. They also use improved designs to run cooler, including better internal airflow and sealed bearings to further increase energy savings. Using the motor’s nameplate information and your estimated hours of use, we can easily estimate the energy use and potential savings of a new high-efficiency motor. Some motors could also be a good candidate for a Variable Speed Drive (VSD), also called a Variable Frequency Drive (VFD). Just take a look at what’s controlling, or not controlling, your fans and other motors that could run slower.

Variable Speed Drives

two variable frequency drives

For variable torque applications such as with fans and pumps, a variable speed drive (VSD) is a good investment.  A VSD is a motor controller that slows down the motor to match the speed of the work required resulting in less energy consumed.  On top of saving money on your energy bill, they also reduce the wear and tear on pumps and motors, replace the need for pump control valves, provide greater control of your equipment, and can also include remote start capabilities.

Looking at dairy farms as an example, a VSD is often the single most important upgrade you can make. Instead of a vacuum pump running at 100% while it’s on, a VSD will control the output so it only uses as much power as is necessary. Installing a VSD typically saves around 60% in electricity costs, which amounts to thousands of dollars yearly for a medium-sized farm.

About 25% of the world’s electric energy is used by electric motors in industrial operations. No matter the type of operation you have, a VSD is always worth consideration. Why run motors at full speed when the same amount of work can be done over time?

Where to Start

How do I make energy efficient improvements that make good business sense and are cost-effective? A good place to start is an energy assessment from The Energy Group based in Des Moines, IA. The Energy Group can provide an investment-grade energy assessment maximizing your chance for project approval and also provide project management for the upgrade once your funding is approved. The Energy Group has helped customers throughout the Midwest save energy for over 30-years and has performed well over 200 grain bin assessments and many sales tax exemptions. In addition, The Energy Group has performed many solar studies, performed numerous studies for sales tax exemptions, and can do life cycle cost analysis to make sure the proposed improvement is justified and you are confident in moving forward.  Our energy experts identify and evaluate energy-saving measures throughout your operation.

Potential Funding

The USDA’s Rural Energy of America Program or REAP may work well for you. The most recent REAP grant cycle funding around the country awarded over a million dollars for solar installations, energy audit funding, LED lighting retrofits, energy efficiency retrofits, and grain dryer improvements.  You may be eligible for a grant as well! See the program fact sheet on USDA’s website for more details.

Our team can assist in a search for grants or guaranteed loans through REAP.  Potential funding may cover 100% or a large portion of eligible project costs. A stipulation for obtaining a grant or loan is to obtain an energy assessment prior to the application.

Utility company or REC energy efficiency rebates may also be available on certain energy efficiency improvements.

Sales Tax Exemptions

Iowa AG operations are eligible for sales tax exemptions on energy bills. The Energy Group will determine your exemption rate, get it established on your bill, and can also apply for a reimbursement for up to three years of overpaid sales taxes.  For example, an Iowa livestock processing plant qualified for an 85% exemption on sales taxes associated with their electric usage and 95% exemption on sales taxes associated with their gas usage, resulting in a saving of $117,000 over three-years.  Another company spending $705,000 a year in energy costs saved $29,500 per year in sales taxed resulting in a savings of $88,500 over three years.  Still, another customer spent $520,000 per year, saved $24,700 per year resulting in saving $74,100 over three years.  You can see significant energy savings can be attained.  Don’t leave money on the table.

The Energy Group staff has engineers, certified energy managers and energy professionals with a combined 133 years of service in the energy efficiency field. Contact us today to schedule your assessment and start saving money!

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