Energy Management

Energy management includes planning and operation of energy production and energy consumption units. Objectives are resource conservation, climate protection and cost savings, while the users have permanent access to the energy they need. It is connected closely to environmental management, production management, logistics and other established business functions.

One of initial steps for an effective energy cost control program is the base line energy assessment, which examines the pattern of existing energy usage by the government or any sub-entity of the government or private organization. This program will set the reference point for improvements in energy efficiency. Energy efficiency can improve the existing energy usage and benchmarking of every individual section such as area, sub-area and the industry etc .

Facility management is an important part of energy management, because a huge proportion (average 25 per cent) of complete operating costs are energy costs. According to the International Facility Management Association (IFMA), facility management is “a profession that encompasses multiple disciplines to ensure functionality of the built environment by integrating people, place, processes and technology.”

The central task of energy management is to reduce costs for the provision of energy in buildings and facilities without compromising work processes. Especially the availability and service life of the equipment and the ease of use should remain the same. The German Facility Management Association (GEFMA e.V.) has published guidelines (e.g. GEFMA 124-1 and 124-2), which contain methods and ways of dealing with the integration of energy management in the context of a successful facility management. In this topic the facility manager has to deal with economic, ecological, risk-based and quality-based targets. He tries to minimize the total cost of the energy-related processes (supply, distribution and use).

The most important key figure in this context is kilowatt-hours per square meter per year (kWh/m²a). Based on this key figure properties can be classified according to their energy consumption.

  • Europe: In Germany a low-energy house can have a maximum energy consumption of 70 kWh/m²a.
  • North America: In the United States, the ENERGY STAR program is the largest program defining low-energy homes. Homes earning ENERGY STAR certification use at least 15% less energy than standard new homes built to the International Residential Code, although homes typically achieve 20%-30% savings.

In comparison, the Passive house (Passivhaus in German) ultra-low-energy standard, currently undergoing adoption in some other European countries, has a maximum space heating requirement of 15 kWh/m²a. A Passive House is a very well-insulated and virtually air-tight building. It does not require a conventional heating system. It is heated by solar gain and internal gains from people. Energy losses are minimized.

There are also buildings that produce more energy (for example by solar water heating or photovoltaic systems) over the course of a year than it imports from external sources. These buildings are called energy-plus-houses.

In addition, the work regulations manage competencies, roles and responsibilities. Because the systems also include risk factors (e.g., oil tanks, gas lines), you must ensure that all tasks are clearly described and distributed. A clear regulation can help to avoid liability risks.

Energy Strategies

A long-term energy strategy should be part of the overall strategy of a company. This strategy may include the objective of increasing the use of renewable energies. Furthermore, criteria for decisions on energy investments, such as yield expectations, are determined. By formulating an energy strategy companies have the opportunity to avoid risks and to assure a competitive advance against their business rivals.

According to Kals there are the following energy strategies:

  • Passive Strategy: There is no systematic planning. The issue of energy and environmental management is not perceived as an independent field of action. The organization only deals with the most essential subjects.
  • Strategy of short-term profit maximization: The management is concentrating exclusively on measures that have a relatively short payback period and a high return. Measures with low profitability are not considered.
  • Strategy of long-term profit maximization: This strategy includes that you have a high knowledge of the energy price and technology development. The relevant measures (for example, heat exchangers or power stations) can have durations of several decades. Moreover, these measures can help to improve the image and increase the motivation of the employees.
  • Realization of all financially attractive energy measures: This strategy has the goal to implement all measures that have a positive return on investment.
  • Maximum strategy: For the climate protection one is willing to change even the object of the company.

The basis of every energy strategy is the corporate culture and the related ethical standards applying in the company. Ethics, in the sense of business ethics, examines ethical principles and moral or ethical issues that arise in a business environment. Ethical standards can appear in company guidelines, energy and environmental policies or other documents.

The most relevant ethical ideas for the energy management are:

  • Utilitarianism: This form of ethics has the maxim that the one acts are good or right, whose consequences are optimal for the welfare of all those affected by the action (principle of maximum happiness). In terms of energy management, the existence of external costs should be considered. They do not directly affect those who profit from the economic activity but non-participants like future generations. This error in the market mechanism can be solved by the internalization of external costs.
  • Argumentation Ethics: This fundamental ethical idea says that everyone who is affected by the decision, must be involved in decision making. This is done in a fair dialogue, the result is completely uncertain.
  • Deontological ethics: The deontological ethics assigns individuals and organizations certain obligations. A general example is the golden rule: “One should treat others as one would like others to treat oneself.” Therefore everyone should manage their duties and make an energy economic contribution.

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