Energy is a business issue

Towards the end of 2011, the government published its proposals for Electricity Market Reform (EMR). The goal is to decarbonise the UK economy, with a focus on taking the carbon out of our energy production at source. The government target is to produce 15% of energy from renewables by 2020. That figure is currently around 3%.

One of the main pillars of EMR is to raise the price of carbon, thereby giving low-carbon sources of energy a better chance in the market. Long-term support for large scale low-carbon energy production will also be given through feed-in tariffs. There will also eventually be a maximum amount of carbon per kWh produced that new power stations will be allowed to emit.

These proposals will start coming into force from 2013 and there can be little doubt that as a result, energy prices will rise. Some market estimates are that energy costs will go up by 15% a year until 2020. Energy will become a bigger business cost in the next few years and continue to grow over the decade, and possibly beyond.

Energy efficiency is therefore a business issue, and not one that should be limited to those organisations that want to be seen to be green. Finding energy waste and cutting it out of your business should be a top priority and as important as minimising other business costs in a tough economic climate.

In the USA, leading organisations are already equating energy efficiency with business efficiency. Several businesses are participating in a scheme that enables them to take on postgraduate business MBA students and give them the task of identifying where energy savings can be made and how.  Millions of dollars have already been saved.

These projects show that methods for saving energy don’t have to be elaborate but can be as simple as using occupancy sensors to save lighting and heating costs; educating staff to turn off equipment or turning off lights in unused parts of a building. This sort of strategy can be implemented by any organisation, regardless of size.

The first and most important step is to understand your current position. It is very likely that all the information you need is available in your building energy management system (BEMS). Look at what your energy use is and identify where most of the energy is being used. Spotting anomalies in the data such as energy use at weekends when offices are unoccupied can be a major energy saver – and they cost the business nothing.

Now is the time to think of energy as a business issue, and to treat it like any other element of business strategy. What you can’t measure, you can’t manage, so use your BEMS to start taking control.

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