SME manufacturers win $8.1 million in grants to cut energy bills

A group of SME manufacturers in the struggling food and wine sectors are among the recipients of $8.1 million in cash in the first grants from the Gillard government’s $1 billion Clean Technology Investment Programs.

Winemaker De Bortoli will receive $4.8 million to reduce energy across its wine making, packaging, warehousing and site services areas, while the second largest grant of just over $1 million went to Bradford Insulation, a subsidiary of building giant CSR, for the installation of a gas-fired co-generation system.

But several SME manufacturers also received hefty handouts. Fengrove Winery in Australia will get $446,390 to help fund the installation of a solar power system, while food manufacturer Crafty Chef will receive $499,999 to help fund an upgrade to its refrigeration system.

DTR Holdings, a food manufacturer in the Queensland town of Bundaberg, will get $300,000 to install a new processing system.

The grants were handed out through AusIndustry, which is running the investment programs. Climate Change Minister Greg Combet says 3,000 projects will eventually be funded.

The news comes two weeks after clean tech accelerator Ignition Labs closed applications for its three-month program. The successful applicants are expected to be announced soon.

The program will see five clean tech businesses receive $25,000 in seed capital in addition to hands-on mentoring. They will also participate in a road show in Australia and the United States.

Meanwhile, Jitesh Gohil, general manager of Crafty Chef, says the Clean Technology Investment grant came at exactly the right time for the business.

Crafty Chef supplies frozen meals such as cottage pies, chicken risotto and samosas to the big supermarkets under The Good Meal Company, Bella’s Kitchen and Simply Special brands.

“We are in a fortunate position where our business is growing and we had a bottleneck with our freezing capability that led us to thinking about what we should step up to,” Gohil says.

Gohil received support from the NSW Government to study its energy usage with a consulting firm called Minus 40 and was then pushed towards the Austrade grants program.

“Usually we just keep our heads down and get on with it, and it’s the first time we’ve got this kind of support,” he says.

“This is the biggest expansion of our business and it’s been really timely to get this support.”

Gohil says that while applying for the grant did involve some work, he would recommend it to other SMEs – particularly those willing to work with a consultant for extra assistance.

“We’d really recommend businesses look at this closely,” he says.

“There is work involved in this and there is change involved, but at the end of the day we’ve been able to make our business much more efficient… and it gives us the capacity to grow.”

Gohil is expecting his energy bills to come down by 55% on a per kilo of product basis.

“It’s monstrous. On our current volume and current energy costs, it will save us around $65,000 a year.”

Crafty Chef’s refrigeration upgrade will cost $1.12 million, with the grant covering just under half of that.

The rest will be financed through Low Carbon Australia, a company set up by the government to help businesses obtain finance for energy reduction projects.