Five generations and 167 years ago, Yalumba planted its first vineyard and is now recognised as one of the most prestigious and historical wineries in Australia.
The brand has expanded operations across the country which wouldn’t have been possible if the team wasn’t so tech savvy and financially astute.
Under the leadership of executive director Andrew Murphy, and winery operations manager, John Ide, Yalumba’s Angaston winery in the Barossa Valley has developed energy efficient strategies to reach optimum levels of performance.
Ide has been in his role at the facility for eight years, and has substantial expertise in the field of engineering.
“We’re installing [solar power] on all our various branches around the country: WA, Queensland and Victoria, and then both wineries – the big installs here and in Oxford Landing [near Nuriootpa in the Barossa],” Ide said.
“We have about 1.2 megawatts (MW) at our Angaston site here and we’re going to have 700 kilowatts (kW) at Oxford Landing.”
Since the solar panels were first installed in early 2016, Yalumba now boasts the largest solar system installation ever seen at an Australian winery and with a completely new system of energy efficiency, it’s never looked back.
Ide said the company has saved between 20-40% in power savings thanks to the solar panels, and a combination of optimised equipment and installations of variable speed drives and compressors.
So how does a winery go about installing solar? Firstly, it’s recommended that wineries follow the basic steps to energy efficiency (as seen on page 43) before looking into solar installation.
Solar power is an effective tool if a winery can manage its existing infrastructure and power consumption, but for some smaller scale wineries, it may not be a viable option financially at all.
If used correctly, solar can have an incredible impact on daily operations, and much of the financial bearing is dependent on agreements with the power retailer.
“All of our solar is a power purchase agreement, so we have an agreement with AGL to buy the power from the solar panels and so we don’t have any capital outlay,” Ide said.
Essentially, this agreement means the asset will become the consumers after ten years, which means no capital outlay in the meantime and extra funding to spend on maintenance, infrastructure, or other winery costs.
“So you’re basically paying for the infrastructure as well as the power and there’s various people that offer it,” Ide said.
“There are a few traps because when you’re generating power, if you’re not using it you’re still paying to generate that power. You pay the cents per kilowatt an hour, even if you’re not using it,” he explained.
“You do get an offset if you’re putting it into the grid so it’s not so bad, but you can get into a situation where you’re paying more to generate than you’re getting back for feeding it in.
“You need to be using above 85% of generated power, below that it starts becoming marginal.”
Executive director Murphy – who has devoted 37 years working at Yalumba Family Vignerons – said solar comprises around 25% of total energy usage at the company’s Angaston site.
“Even on a Saturday in the holidays when there’s no production happening we’ve still got underlying infrastructure that’s still being powered, but on a low level – it’s about how you size the solar to maximise its usage,” he said.
Ide confirmed that with a power purchase agreement and the introduced energy efficiency measures, the solar panels have just about paid for themselves already.
“We had a lot of people approaching us for straight out purchase [of the panels] but we could never make the figures add up,” Ide said.
On a large market contract, Yalumba is paying for maximum demand power and actual power used on separate contracts.
“Let’s say you’re paying 20 cents a kW per hour for maximum demand and 20 cents for your power, you’re only recovering 20 cents for your power and you’re not really impacting maximum demand that much.”
“So when you looked at straight out purchasing it was about a five to seven year payback,” Ide said.
Yalumba was lucky enough to get a foot in the solar market before prices increased, successfully signing up to a power purchase agreement that meant no capital and a long-term investment.
However, for smaller wineries on a residential type bill of 34 cents or 45 cents, a straight out purchase has great potential as wineries can recover the whole amount.
Yalumba is now cash-flow positive due to the solar panels and are considering even more alternative energy sources, such as electrical batteries or ice batteries.
For now, Murphy said electrical batteries aren’t viable as they are expensive and there’s not much return after installation.
Ice batteries on the other hand, could be a promising venture worth further research.
“We’ve looked at running an ice bank and using it at night when power is cheap, then using that ice to chill the water during the daytime,” he explained.
“We’ve got that designed in our winery [and we’re] looking to install it in Oxford.”
“It’s about spreading the load over the network. You can over-chill when power is cheap and then you don’t need to turn it back on during the day,” he said.
For now though solar power has proven its worth as a commendable energy source when used correctly and when combined with the right contract.
“We get the panels in eight years’ time for nothing and then it’s all free,” Murphy said.
It’s all about crunching the numbers and doing the research for what works best for you.
This article was originally published in the Australian and New Zealand Grapegrower & Winemaker, March 2018 edition, as a second installment of ‘How to reduce power costs for wineries’.