A strategic focus on a well-defined energy strategy can fundamentally shift an organisation’s resilience in times of energy uncertainty and economic volatility.
According to McKinsey, taking a proactive approach to energy costs can reduce their impact on the budget by as much as 10%, and can minimise the impact of energy price volatility in the long term.
Building an energy strategy needs to be methodical and precise, and it needs to dig into the crevices of the organisation’s operations, areas of energy reliance and energy provision to gain a clear picture of its energy consumption.
In the current market – both economically and environmentally – organisations must find smart ways of outrunning the energy crisis and building resilience. An energy strategy is a smart and sustainable way of mapping out the routes to energy optimisation and to resolving any legacy energy challenges.
“There are several benefits to having an energy strategy in place,” says Gareth Swart, senior process engineer at World Wide Industrial Systems Engineers (WWISE). “Firstly, it allows you to understand your significant energy uses across assets, appliances that consume the most energy, and how energy contributes to your operational costs across different sources such as the municipality, generators, wind, solar and more.
“Understanding the factors that drive energy consumption and the development of performance indicators allow the organisation to accurately compare productivity and operational activities.”
A well-designed strategy will also provide the business with clear Energy Performance Indicators that measure and provide a level of efficiency and should be developed alongside the implementation of energy initiatives that have equally well-defined objectives, targets and action plans.
The organisation can then look at how it can optimise its energy profile by investing in solutions such as sensor lighting and alternative energy solutions while also focusing on training across employees to engage in behaviour management around energy usage and awareness.
These steps will help to improve operational control by identifying critical operating parameters and maintenance requirements, and introduce an evidence-based approach to demonstrating the effectiveness of energy improvement initiatives throughout the company.
“The key elements of building a resilient energy strategy are simple,” says Swart. “First, identify the internal strengths, weaknesses, and external opportunities and threats, unpacking the issues that the business has with energy constraints such as cost, capacity or supply. Then, identify additional external factors that include political, economic, social, legal et al, and document their scope.
“Utilising SWOT and PESTEL strategies enables you to define the objectives which will help you to then set policies, processes and procedures that identify correlations and energy optimisation models. These policies, procedures and processes support the strategy in order to achieve the objectives and can be refined to ensure there is accountability and responsibility.”
Unpacking all these elements can be complex, so best practice would be to undertake an initial gap assessment to identify the gaps and energy consumption parameters followed by workshops that will provide a picture of the company culture and help to build governance and processes that are aligned with best practice.
The organisation can also use data processing and analysis to determine realistic and achievable goals and supplement this information gathering with a risk assessment that will highlight the risk areas that need to be considered. This process will find the holes and the problems, but it’s the monitoring tools, policies, procedures and targets that will keep the company on track and fill the gaps.
“The business will need to undertake internal audits and management reviews to ensure that the company remains on track, and implement corrective actions to ensure consistent improvements,” says Swart. “It’s also important to leverage the toolkits and measurement best practices outlined in ISO 50001 and validate the energy strategy through external certification bodies like SABSD, BSI, SGS and TUV Rhineland.”
The ISO 50001:2018 energy management system focuses on managing the consumption of energy by understanding the different sources of energy, use and bill verification. It provides the organisation with energy performance indicators and by configuring the management of energy consumption to create energy programmes and objectives that reduce consumption. This ISO standard delivers a strong return on investment and a measurable reduction in operational expenditure.