ENERGY MANAGEMENT STRATEGIES

A wide range of energy management strategies are employed at all industrial facilities. For many, there may be no formal energy management program. The monthly electric and gas utility bills are simply paid and filed away. For others at the other end of the extreme, energy is an integral consideration in all aspects of business decision-making. The strategies employed by companies generally fall into one of five categories:

1 Do Nothing
Simply pay the utility bills. For some, energy may be perceived as a fixed cost that cannot be affected. For others, the resources required to reduce energy costs is believed to outweigh the potential benefit.

2 Price Management
Seek ways to reduce the cost of energy such as fuel switching or finding lower energy supply costs. Some facilities may view energy costs as the only variable that can be controlled. For others, reducing the cost of energy is simpler than upgrading equipment or trying to change plant culture.

3 Low-Cost, No-Cost Opportunities
Try to do the best you can with what you have. Management may set goals to reduce energy use by 10% without spending any money. One-time efforts to tune equipment and operating strategies can produce significant energy savings immediately. While this is a good starting point towards assessing energy management opportunities and finding an immediate success, these savings often erode over time if adequate procedures, measurements, and roles are not created to sustain success.

4 Capital Projects
Pursue equipment upgrades that improve efficiency. This is pursued by facilities that feel that efficiency is primarily an equipment issue or want to avoid tackling efficiency from a staff perspective. Energy cost savings can be significant but fall short of true optimization because of the failure to address opportunities from the human perspective.

5 Strategic Energy Management
Incorporate energy into all aspects of normal business operations. A facility develops a formal energy policy, assigns leadership and sets goals. An energy plan enables a facility to prioritize opportunities and assign roles and responsibilities for achieving goals. The next step is to pursue capital projects and low-cost, no-costs methods to reduce energy use. By tracking Key Performance Indicators (KPIs), a facility can become energy productive.

Clearly, a Strategic Energy Management program presents the best opportunity to fully optimize energy efficiency. An energy management program is most effective when it is appropriately scaled to meet the needs of a facility. In general, the greater energy costs are the greater percentage of total operating costs is needed toward an effective energy management program.