5 Steps To Energy Management Planning

With energy as the second largest expense for most organizations, it's critical for facility executives to revisit their energy management program strategies periodically.

By Nick Mirisis

While turning the lights out each night is certainly an energy saver, effective energy management is all about maximizing long-term sustainability and finding key ways to save energy and money while creating a culture of conservation.energy management

For most organizations energy is the second largest expense, so it is critical that facility management revisit overall energy management program strategies. This includes tracking energy expenses — utility bills, energy consumption, and emissions — and finding ways to reduce energy usage. According to ENERGY STAR, it’s possible to decrease energy use by 10% by implementing simple changes, like adjusting temperature settings, with little or no cost. But consistency and organizational adoption are critical.

A step-by-step approach to energy management planning that encourages organizations to: Assess, Prioritize, Plan, Execute, and Maintain (APPEM) energy management initiatives will yield the most optimal results.

1) Assess the current state of energy use. Reviewing current energy usage by examining historical data offers insight into energy expenses, utility bills, energy consumption, and emissions. Going a step further, performing an energy audit and tracking energy bills with an energy management system or Excel tables allows organizations to assess energy consumption and needs in order to make data-driven decisions.

Energy baselines, a reference tool for comparing energy performance, allows organizations to compare energy performance before and after a change is made to evaluate impact. Understanding baselines helps:
• Calculate energy performance
• Forecast energy use and cost
• Measure and verify savings from energy efficiency projects
• Monitor the effect of conservation initiative

Gathering utility usage data has helped Henderson County, NC establish baselines and better understand trends for an effective resource conservation plan. By tracking consumption data, the county can set targets for reductions, estimate progress toward goals and assess current and future energy usage trends.

2) Prioritize strategic energy initiatives. After assessing energy use and savings, facilities and energy managers must prioritize what to act on. If cost is more critical than conservation, then payback and ROI should drive decisions. In contrast, if the organization is focused on conservation, then initiatives that reduce the carbon footprint and increase ENERGY STAR scores should be top priority, even if those have a longer payback period.

Gaining buy-in from the executive team, board, or equivalent is key to the success of energy management measures. Presenting a metric-driven business case utilizing energy audits and cost avoidance data is important. Also, for government or tax-funded organizations, the potential positive publicity from reducing the organization’s carbon footprint and sharing success metrics provides a compelling case for elected officials and administration.

3) Plan for funding. Achieving funding for energy conservation measures (ECMs) is vital and there are many options for financing a plan, such as performance contracting, grants, bonds, taxes, etc. In fact, cities now have an abundance of governmental and private sector tools available to finance these investments.

Facility leaders should weigh the benefits of grants versus bonds and internal funding, as well as performance contracting. Organizations choosing a renewable ECM, should have an energy management system to ensure they are receiving all of the renewable energy credits they are entitled to from an energy provider.

4) Execute and communicate the plan. Planning is key to energy conversation and a solid communications plan can help ensure all stakeholders are on the same page. Utilizing a system that offers easy to share dashboards, charts, and graphs can make reporting and communications more effective and efficient. Efficient communication can also help create an organizational culture of conservation, getting every employee and team member involved. Dashboards that provide transparency to the public help communicate successes to build trust and gain buy-in for additional measures. Proper tracking of performance should be implemented to hold stakeholders and vendors accountable, which helps organization measure energy management goals.

At Gresham-Barlow School District, 15 miles east of Portland, OR, everyone from the principals to the custodians to the students is involved in energy efficiency efforts. Fostering competition among various district buildings via ENERGY STAR scores and making responsible energy consumption fun has been beneficial and contributed to the district saving $1 million per year.

5) Maintain the energy strategy and build upon success. Maintaining and maximizing strategic energy reduction efforts is a critical but often overlooked part of the plan. Finding a way to make energy saving initiatives a team effort and rewarding those who contribute to the program can help build a positive conservation culture. Creating small wins and building on those successes will help ensure energy savings are long lasting.

Energy is an important part of operations management that needs a comprehensive plan and attention to succeed in achieving savings and efficiency. In addition adopting this five-step approach can help facilities and energy managers can gain greater leadership and improve their leverage for budget needs in other areas of their departments.

energy managementMirisis is vice president of marketing for Dude Solutions, a Cary, NC-based operations management software company serving the education, government, healthcare, and manufacturing industries. He currently serves on the Board of Directors for the National Business Officers Association and the Consortium for School Networking.