2.5 Conduct an energy-efficiency assessment for existing operations

When a business and its operations are reviewed through the lens of energy efficiency, a wide range of opportunities is typically identified. Even companies that have worked on energy efficiency for a number of years can use the focused attention of an energy-efficiency assessment to drive their energy performance further.

A rigorous and comprehensive assessment can be achieved through the interaction of:

  • demonstrated leadership and support
  • good data and effective analysis
  • involving the right people
  • having a process in place that brings the right people and effective analysis together to identify opportunities.

No single person has all the answers. In the past, there was typically an emphasis on an external energy expert reviewing an operation and providing a list of recommendations. External experts can provide extremely useful input, but their effectiveness is limited if they operate without the active involvement of site stakeholders and other key people. This is why the AS/NZS 3598:2014 series has been designed to be performed by external auditors, internal auditors, or both. The standards also explicitly consider the needs of a business and include the evaluation of various aspects of energy management at a site, including the availability of data.

Companies may use other approaches, but it is important to have a process that provides an opportunity to step back from day-to-day work and to encourage a broader perspective on how energy is used and where new opportunities might be found.

The goal of your assessment should be to identify a broad range of opportunities that have both short-term and longer term potential. In the short term, you might focus on more straightforward projects that can be implemented immediately to demonstrate the practical focus and benefits of the assessment. This can help build management support at your site and within the organisation more generally. For more complex opportunities that require significant capital for implementation or further investigation, it is important that you plan for the level of investigation required and consider the best timing for implementation in relation to budget cycles, shutdowns and other factors that could influence the implementation of a project.

Planning and resources

An energy-efficiency assessment requires proper planning and resourcing, coupled with a communication strategy that engages with all relevant stakeholders. Planners may consider a progressive approach to conducting the assessments in particular areas of the business, with a plan to complete assessments of the whole business process over a period.

The project plan for the assessment should detail the assessment’s objectives, scope, planned activities, timing, resource requirements (personnel, financial and technical), expected deliverables, and potential risks and strategies to manage them. The plan should also outline actions to be taken after the assessment, including reporting on outcomes and timelines for tracking and reviewing and potentially undertaking future assessments. The assessment project plan often evolves as the project team is established.

The amount and cost of energy use for the organisation can be a guide to the level of resources dedicated to the assessment.

People and skills

The value of an energy-efficiency assessment can be dramatically increased by seeking the input of stakeholders within the organisation. The necessary skill sets may exist within disparate parts of the business, which reinforces the need to use a team-based and company-wide approach.

Ideas for energy-efficiency improvements can be found at all levels of the organisation, from shop floor through to head office. Relevant stakeholders also include the people who have influence over capital and operating budgets, people with the authority to make changes to processes and procedures, and people who have a role in implementing energy-efficiency improvements.

Energy-efficiency assessors should include not only those with energy and process expertise, but also people external to the process who can provide alternative perspectives and encourage different ideas. A cross-silo approach to the assessment often results in more innovative solutions. Typically, the identification stage needs broad input but the data analysis and evaluation require specific technical understanding

Using external resources

The capacity of organisations to perform energy-efficiency assessments varies, depending on the available resources and skills. Depending on factors such as the organisation’s energy expenditure, size and resource availability, it may be reasonable to create full-time positions that are dedicated to improving energy efficiency or deploying existing internal resources to particular assessment tasks.

For other organisations, it may make more sense to source external technical expertise. External experts can also offer specialist advice to fill skills or knowledge gaps. A wide range of energy services companies support specific aspects of an assessment, including data collection, opportunity identification and analysis, facilitation, and reporting.

Preparing a focused scope of works helps to clarify the job, the expectations and the input required to facilitate the work of external consultants. The scope of works should contain the principles discussed in these pages to ensure that the consultants perform thorough assessments. This also ensures that accurate cost estimates can be obtained from different firms. The scope should also clearly outline how analysis and recommendations will be presented for findings to be incorporated into business cases. This includes any assumptions made in the estimation of project costs and energy savings. The three types of audits specified in the AS/NZS 3598:2014 series—basic site audits, detailed site audits and precision subsystem audits—provide a sound basis for a comprehensive scope of work.

Understanding energy use

Developing an understanding of energy use and relating energy to core business activities can bring many nights into the relationship between energy and productivity. Data analysis techniques that may be applied are as follows:

  • Graphs of energy use over time (seasonal, monthly, weekly, daily, hourly)—Understanding the reasons behind energy use patterns and changes in energy use in relation to business activities can often yield new insights.
  • X-Y plots of energy use versus production or other parameters—This technique can reveal whether or not there are relationships between energy use and production. It can also highlight whether there are production thresholds at which a dramatic change in energy use occurs.
  • Benchmarking—Using energy performance indicators reveals whether a process, facility or business unit is operating at its optimal performance level. Benchmarking can be used to compare actual energy use with theoretical (calculated or simulated) energy use. Comparisons with other plants, sites, processes, shifts, operators or other factors can be made.
  • Pinch analysis—Pinch analysis is a design method based on graphical analysis that can be used to optimise the design of complex thermal systems so as to maximise heat recovery. For processes or plants with complex flows of hot and cold streams, it can be used to evaluate whether there are further opportunities for better heating and cooling through the placement of heat exchangers at optimal locations within the process. This method requires engineering expertise.
  • First principles (theoretical calculations)—A theoretical calculation of estimated energy use can be used to assess systems that cannot easily be measured. Theoretical models are less costly to interrogate than changes to the production system, allowing different scenarios to be explored through the manipulation of operating modes, variables and parameters.
  • Energy-mass balance—Modelling the energy and material flows within a site, facility or piece of equipment or machinery can provide a deep understanding of those flows and indicate where energy is exiting the process through heat or steam losses, and where opportunities to improve efficiency may exist. Footnote 5

Identifying opportunities

Use the data that has been analysed to identify areas where energy-saving opportunities may exist. Providing the results of the energy analysis to a broad range of people throughout the organisation can often result in further ideas and insights.

The importance of involving a cross-section of personnel to identify opportunities cannot be overstated Workshops are a common means of gathering the relevant experts to discuss the data and other information gathered during the energy-efficiency assessment and brainstorm potential ideas and opportunities. Further collaboration can be achieved through focus groups, site visits, staff suggestions, and consultation with suppliers or external experts.

All identified opportunities should be documented in a ‘register of opportunities’ or similar document. This often becomes an enduring record used to track ideas and outcomes and to revisit potential opportunities if operating conditions or energy prices change.

Detailed analysis of selected opportunities

The detailed investigation phase determines the feasibility of each opportunity and gives decision-makers the information they need to make a final investment decision. Further analysis is often needed before a decision is made on which opportunities to pursue. This may require time to collect more data or investment in equipment to improve measurement accuracy.

Businesses often have established practices for evaluating and seeking funds for new projects, such as project charters or templates. Energy-efficiency opportunities that merit a more detailed analysis should use those processes.

A whole-of-business approach improves the understanding of the overall costs and benefits of energy efficiency opportunities. Project risks also need to be understood and addressed

Other factors that may be considered in this analysis are:

  • shutdowns or downtime needed to implement the change
  • changes in production output
  • changes in other process inputs, such as water or raw materials
  • changes in maintenance costs
  • hardware changes that make spare parts inventories obsolete
  • business plans or forecasts that affect the lifetime or throughput of the process that is being changed
  • costs of training or new skills that might be required

Comprehensive and detailed analysis builds confidence in the findings among the project team and senior management.

Business decisions and implementation

Existing business processes should be used to arrive at decisions on energy-efficiency opportunities. This helps to integrate energy efficiency into the organisation as a regular business activity. If external experts are used to help conduct the energy-efficiency assessment, their findings should be documented in a way that facilitates the integration of the findings with internal business case or project planning processes.

In some cases, one manager may be able to review and approve requests based on information gathered during a detailed analysis. Larger projects often need to go through more extensive approval processes.

Tracking and communication

Opportunities implemented as a result of the assessment must be monitored over time to determine their effectiveness. Measurement and verification can yield further insights into energy use, track any issues or unintended consequences that have resulted from a change, and build internal knowledge and expertise in energy management.

Communicating the status and outcomes of the energy-efficiency assessment to senior managers and the rest of an organisation establishes a shared understanding and basis for action. It also records valuable lessons and helps build senior management support for future energy management initiatives.


Footnote 5
For further detail, see Australian Government, Energy savings measurement guide, version 2.0, 2014, http://eex.gov.au/files/2014/06/ESMG.pdf.

Return to footnote 5 referrer

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