Wineries have been facing rising costs almost across the board for a decade or more. Labor availability and costs are longstanding concerns, and California has seen some of the sharpest increases in energy rates in the nation. Rates are more than triple the national average and have continued to rise just in the last few years due to inflation and wildfire liability costs passed on to utility customers.
Adding to the cost worries of many wineries and vineyards, enforcement of the Sustainable Groundwater Management Act (SGMA) has ramped up in recent years. It’s the first ever attempt to regulate groundwater use in California and was passed in 2014 during a multi-year drought to protect California’s aquifers. The Department of Water Resources (DWR) oversees the law’s implementation and has recently been putting water districts and growers on notice for lack of compliance.
Combining these escalating energy costs, a tight labor market, and potential fines for water regulation non-compliance, California’s agriculture and wine businesses are highly motivated to find cost-cutting solutions to enhance their profitability.
Chris Terrell, Co-founder of Wexus Technologies, says of the dramatic increase in energy rates, “It’s hitting the ag industry very hard in terms of profitability—many farmers spend over a million dollars a year on utility bills and over 90 percent of their energy costs are tied to irrigation. They need relief now.”
Terrell founded Wexus Technologies with Co-founder Chris Vines to develop an intelligent software solution that would help farmers automate tasks while reducing their energy and water costs. In a project sponsored by the California Energy Commission and UC Davis, his team spent three years developing the technology with farmers in the field based on “boots on the ground” feedback. The resulting software platform provides farmers with a better way to manage their energy costs and water usage in real time and can be accessed from both the office and in the field. And no additional equipment needs to be installed.
Wexus software links directly to a customer’s utility account and takes only a day or two to set up before it begins automatically monitoring a winery or vineyard’s usage. The software immediately reviews a customer’s energy bills and historical usage to identify quick opportunities to reduce electric and water costs. Terrell expands on the process, “We start with the up-front return on investment (ROI). Agricultural users have many options for utility rate plans, and we often find that they’re not on the best one. So the software automates the process, shows them how much money they could save by switching to a better plan, and does it for them without having to change operations or irrigation schedules. It also factors in wet vs dry years because irrigation can change drastically from year to year.”
One Central Coast grower shared that, “With Wexus Technologies’ rate analysis service, our operation was able to save 40%—a $40,000 savings in annual energy costs—on just one irrigation pump.”
- Earn upfront energy cost savings. Choose the best utility rates, track energy expenses in real time, and track renewable energy ROI.
- Turn your energy meter into a water meter. Monitor water usage in real time, while promoting conservation, reducing labor expenses and staying in compliance with new regulations (SGMA).
- Achieve California Sustainable Winegrowing Alliance (CSWA) certifications. Easily track and report data needed for the Energy Management Plan (EMP).
In addition, Wexus software tracks the bill savings and ROI of renewable energy systems and provides detailed cost analysis to pinpoint opportunities for improvement. Typically, a solar array may have incorrect billing, equipment problems, or dirty panels that can affect the system’s energy output and cost savings. Wexus’ solar data saw a 20 percent drop in solar energy output during the 2020 California wildfires due hazy skies and ash building up on panels.
For water reporting, the software tracks billions of gallons of irrigation water usage with real-time, automated monitoring of pump activity. It turns an energy meter into a water meter by converting pump test data and energy usage into useful, downloadable reports with information like total gallons or acre-feet used, dollar cost per acre-foot ($/AF) and crop types. This helps growers stay in compliance with new California water regulations like SB88 and SGMA.
Wexus also helps wineries and vineyards achieve California Sustainable Winegrowing Alliance (CSWA) certifications by easily tracking data needed for the Energy Management Plan (EMP). An EMP creates a strategy for managing energy costs, increasing winery efficiency, addressing risks from energy disruptions, and creating a structure for continuous improvement. This is also useful for tracking and reporting greenhouse gas emissions (GHGs) which some financial institutions now require.
Just as critically, the Wexus Technologies program saves winery and vineyard owners time and prevents labor errors that could result in extra costs. Manually compiling energy and water usage information is time-consuming and, if not reported accurately and on time to the state or county water district, can incur a hefty fine. Terrell points out an instance in which a local water district on the Central Coast fined a grower $250,000 for late reporting.
“We make our customers’ lives easier by using software to reduce input costs and automate reporting,” explains Terrell. “For the last ten years, we’ve been working with many leading wineries and vineyards in the industry as well as companies across the ag industry to take the pain out of utility costs.”
In recent years, wine consumption is down and harvests are up. There’s increasing pressure to remove vineyards while still generating income from farmland and not losing access to water rights.
The recent Silicon Valley Bank State of the US Wine Industry report notes that “Publicly, industry experts called for 50,000 acres of vineyard removals net of new planting…While removals are continuing as of this writing, we believe there need to be calls for additional acres removed.”
To redress the associated supply imbalance, some wineries are removing vineyards, and others are considering solar energy to augment their power grid.
“If a customer is looking to add a solar array because a vineyard is coming out of production or the land isn’t farmable,” says Terrell, “we can help them figure out whether the solar array will be profitable for them in the long run and actually make financial sense. And if they already have solar arrays, our real time tracking can help to optimize them, look for areas of improvement, and show the true ROI based on their actual utility bills.”
To see Wexus in action, you can schedule a software webinar demo by going to their website at www.wexusapp.com and clicking the “Demo” button to choose a convenient day and time on your calendar. And to get a free utility analysis and proposal with your data, click the “Join Us” button.
