Prepared by Paul Webb, MEI Chartered Energy Manager

The early days of energy management simply involved turning off the lights or shutting down the heating set-point. As systems evolve and organisations expand their property portfolio, the principles of energy management have become more complex, not to mention with legislation.

The energy management role within an organisation is critical as combined energy and water costs are your 3rd largest expense. These costs are also built into the recovery of the organisations’ sales. Therefore, rising energy costs and legislation really plays a massive part within an organisations’ day to day expenditure.

In the last 12 months alone I have found so many ways to reduce energy costs, from lights not turning off at night, to set-points being either too high, or too low. Simple issues like this don’t require money to fix them. It is not only the physical savings, it is also the soft changes within contracts and billing. I have reviewed many bills which are out of contract, set-up or estimated incorrectly – it is in fact shocking. In 2019 I found a meter that had never been read and after correcting the meter, we secured the client £7,000.  I can’t tell you how pleased they were when the supplier gave them a credit for that value.

Energy management does not need to be complex, it can be very easy to set-up and once implemented into the organisation’s process, it can run forever. Like learning to ride a bike, once you learn your balance, it is something you will always be able to do.

Sadly, not all organisations have the skills or the mindset to deliver this themselves, or they are totally engrossed with their core business, which is understandable. Here though, organisations saving energy and reducing costs are clear incentives, the bigger picture ‘win’ here is the environment.

If we do not embrace energy management we could be doing ourselves an injustice as firstly, every penny counts in business but ultimately, the environment should be our priority.

The simple approach that should work with all organisations is as follows, Review, Realign, Reduce and Report. I am a strong believer in these principles and I would guarantee that after following these principles, significant energy savings will ensue.

I also believe that this simple process can be applied to any type of business and the implementation is fast. This however, will only work if there is ‘buy in’ from the business owners or the board. I have many examples of where we had full commitment from the board, made significant changes to the energy costs and maintained the process year on year with good savings.

Review:

  • Take the last 12 months of billing for gas, electricity and water. Review the Rate, estimation and contract. Graph, report and analyse.
  • Visit building with data and understand how people are managing the property.
  • Document and evidence the systems in place that impact on the energy management of the building eg. Time clocks, BMS and controls.

Realign:

  • Contact the suppliers and rectify any estimated billing, incorrect billing and start to negotiate your contracts. At this stage you could bring in an expert to utilise their exposure to the industry and take full advantage of their buying power.
  • The organisation needs to work with the staff to create awareness of energy management and make sure that the staff are engaged.
  • All systems need to be deployed to increase efficient ways to work and provide aligned conditions for the staff.

Reduce:

  • Build a strategy to maintain energy contracts that are kept aligned and always keep the mindset of reducing costs. Maintain regular conversations with the supplier or the energy contracts advisor.
  • Create an energy ‘champion’ and team to create ‘best practices’ around energy. This will deliver momentum.
  • Implement all recommendations for no cost, medium cost and capital cost. Create a spend to save strategy. Set targets for 2 – 3 year return on investments. Create an action plan.

Report:

  • Monthly review billing and contracts to ensure savings are being implemented.
  • Broadcast all projects of ‘best practice’ firstly with the board and then broadcast on notice boards and the internet.
  • Monthly report to the board or the owners, the progress of the energy management by using the action plan as the tool for continuation.

By following the four principles, the pay off could be significant with reduced gas and electricity costs through better contracts, reduced energy and water consumption, reduced emissions and finally increased profits. In my opinion this process could save up to 25% of your costs which could boost your business significantly in these tough times.

One question I am always asked is where do I start? I would start by reviewing and graphing your data.

If you can try and compare this to last year, you may see some interesting patterns. Each year, on your financial anniversary, add to the graph.

This process will secure you savings and address the key complexities around this industry. If every organisation adopted these steps, we could make a significant difference to our planet.