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Energy efficient label production in Armenia

Investor
Nor Astgh LLC, a manufacturing company
Location
Armenia
Investment
New equipment for plastic wrapping and label production
Investment Size
$200,000
Financial results
Payback period of 7 years; cost savings of $28,000 per year
Energy savings
325.5 MWh per year (61%)

Many Armenians see the products of Nor Astgh LLC on a daily basis – the company  produces a wide range of plastic wraps and labels for food product containers, e.g. for milk and ice cream.

After the production equipment was destroyed by a fire, the company decided to replace it with the energy efficient equipment and addressed Energocredit for funding.

The Energocredit team performed analysis of the investment, primarily the potential for energy savings, financial-technical parameters and risks.

The project included installation of a new unit for plastic wrapping and label production from Turkey.

The $200,000 investment allowed Nor Astgh to reduce its electricity costs by $28,000 per year. This means the investment will repay itself out of energy savings in seven years, turning the future cash-flows into company income for the years to come. In addition, the new equipment allows the company to avoid frequent production stops, which happened in the past, and thus optimise the production process even more.

This is a good example of how new technologies bring energy savings to companies of different sectors and types of production, in addition to other benefits within the production process. Therefore, it is worth checking the energy saving potential while considering investments in the company, as often the energy efficiency investments might be among the most profitable ones.

The EBRD, through Energocredit, supports the sustainable financing and implementation of sustainable energy projects by the private sector. Together, the private, residential and public sectors can make a change in energy consumption patterns and contribute to environmental protection.

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