Tax efficient Cooling
With convenience stores constantly seeking ways to improve their return on investment, one of the most popular areas for store-owners to turn their attention to is reducing levels of waste in the chilled and frozen aisles. Poorly stored and presented chilled or frozen foods, is a turn-off for consumers and creates a major headache for the convenience retailer as well. Creating a financial drain as well as the potential for public health issues.
The obvious solution is to focus on replacing or improving retail display cabinets with curtains, blinds, doors and covers. However, that is only part of the solution. The type of barrier protecting the cabinet from ambient air ingress has a direct impact on the refrigeration condensing units that chill the cabinet. Simply changing or upgrading a cabinet is only half the battle, if the condensing unit is old or inefficient, it will be unable to cope with the flexibility of performance that the new or updated cabinet calls for. Whilst a new cabinet looks sleek and efficient, what you see isn’t necessarily what you get – buyers should beware.
Fortunately, manufacturers of refrigeration condensing units have in recent years designed units to address this specific problem. And, the UK and Republic of Ireland governments’ drive to reduce carbon emissions have created favourable tax incentives in the guise of Enhanced/Accelerated Capital Allowances (ECA – UK and ACA – ROI) for retailers to encourage more efficient chilling and cooling.
Hubbard are the leading manufacturers of ECA and ACA qualifying refrigeration condensing units and these compact units are specified by a large number of the UK and Ireland’s branded and symbol stores. Convenience stores pose a number of unique problems for refrigeration engineers. Often located within close proximity to the communities they support, the noise of refrigeration compressors serving a location can cause friction with the very customers the store owner relies on for his living. And, with footfall varying across peak periods during the day, cabinet door openings increasing with peak shopping times, ambient temperature and humidity changing dependent upon the season and even the number of people within a store, the duty required from the refrigeration equipment for quick pull down can be considerable.
Replacing the packaged condensing unit at the same time as upgrading cabinets makes considerable sense, and can be done tax efficiently using ECA/ACA with the side effect of improving cash flow and reducing energy running costs. The ECA allows the purchaser to set the full capital cost of the refrigeration equipment, cabinet, installation and all associated costs against their profit for that tax year. For non-qualifying equipment capital allowances are usually taken across a tapering ten-year period. The ECA/ACA brings forward the allowance into a single year, which can
have a beneficial impact on a business’ cash flow by reducing its corporation tax bill.
Modern digital condensing units are a critical element of making convenience stores more profitable.
Glass door display units are a popular choice with convenience stores. They allow greater control over product quality and presentation and are widely accepted by consumers. They also place larger demands on the remote refrigeration condensing units that supply the cooling capacity. Older hermetic types have now been superseded by digital scroll compressor units as the refrigeration of choice.
Hubbard Zenith Digital Condensing Units offer a high level of flexibility and responsiveness for use with multiple cabinets, for example, a combined chiller display comprising a run of glass door and separate cabinet sections. Many retailers are moving to more cost-efficient methods of chilled and frozen display, especially the dairy sector where glass door cabinets are standard.
With these displays, compressor duty demands differ significantly with high loads during store opening times and very low loads over night. The high levels of energy consumption associated with traditional condensing units, has made the development of a digital solution offering total flexibility, Hubbard’s key area of focus.
Digital Condensing Units offer responsive performance directly reflecting the duty requirement at any given time, anywhere from 10% to 100% of seamless, variable capacity. This flexibility saves energy when cabinet doors remain closed overnight or at times of low footfall, unlike non-digital units that consume energy regardless of the real-time requirement. And, digital units that run for shorter periods are less noisy and intrusive in urban locations.
Hubbard was the first manufacturer to achieve Energy Technology List approval and the first to offer Enhanced Capital Allowance tax breaks to its customers.
Since 2015, Hubbard units have also been approved for the Sustainable Energy Authority of Ireland’s Triple E list. The new breed of Hubbard digital units, add to a long line of energy-efficient compact models. And, importantly, it is all retailers, large and small from independent outlets, through symbol stores to express, convenience and forecourt outlets that can all benefit from the improved cash flow that the ECA/ACA offers.
Download a pdf of this case study here.
- Cellar Cooling
- Convenience and Retail Cooling
- Multi Compressor Packs
- Cold Room Units
- Heat Recovery Systems
- Transport Refrigeration
- Transport Contracts