Energy Management

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“Re-thinking Your Relationship with Energy,”
Jose Rinu
Roll no-5769
Energy management-an overview
Management is a process involving planning, directing and controlling the various activities to maximize the productivity. In the same context Energy Management is the science involving planning, directing and controlling the supply and consumption of energy to maximize productivity and comforts and minimize the energy cost and pollution with conscious, judicious and efficient use of energy. The basic objective of energy management function is to see that energy needs of the various organisations are satisfactorily met at minimum cost at present and in future to extend possible. Strong commitment from top management is essential for a successful energy management program which includes managerial decision making. However, managing energy does not necessarily require a formal system; by following simple techniques any firm can improve their enrgy consumption performance. Energy strategy spans a number of the key functions within a firm and therefore requires cooperation and commitment from all. Senior management provide the leadership and set direction; finance are involved to ensure that most appropriate purchasing decisions are made; production, as the key user, ensures that energy is used appropriately; engineering ensure that plant is operated and maintained efficiently and HR are involved to facilitate training and help generate a culture of energy awareness.

It typically involve the setting up of an energy management team with participants from each of the functions mentioned above. This team would support a dedicated energy manager with responsibility for the coordination of energy management activities. Depending on the size of the business, this may or may not be a full-time, dedicated post. The team in association with senior management would establish an energy management policy, which should include general aims and specific energy cost reduction targets, timetables and budgetary limits, the methods to be employed and the organization of management resources. The energy manager should set up a system to collect, analyze and report on energy consumption and costs. This can consist of reading meters on a regular basis and the analysis of utility bills i.e. gas, fuel oil and electricity. Business opportunity, potential risks and company positioning are key drivers for company’s energy management.

Steps involved in the process

First look

This first step involves a thorough, organization-wide assessment of the importance of energy to the company in relation to its overall needs, risks, goals, image and reputation, and of potential business opportunities through energy-related products or services. Properly implemented, the assessment can provide clear direction as to the potential inherent in a strategic approach to energy planning and management. The key question posed by the assessment process is “what are the business opportunities related to energy?” This framework provides the context for evaluating energy as more than simply a cost of operation. Companies that have embarked on such an evaluation have asked themselves very fundamental questions about how energy relates to: • Potential business opportunities;

• Potential business risks; and
• The overall “positioning” of the company
The bottom line is that while cost is an increasingly important factor, companies evaluate the importance of energy from multiple perspectives. Other factors such as risk management, reputation, and even product-line issues may carry weight as well. As Howard Stanley of Corning, Inc. observes: “Cost and consumption are key elements of managing energy. You have to gather your data and implement strategies to affect the factors you can control. Even if your energy dependence is low, if energy is important to your company, then a review is justified.” The outcome of this step is...
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