Choosing the best strategy for energy and carbon reduction in medium and large organisations

Energy Audits, Energy Service Companies (ESCo), Partnered Energy Efficiency Programs (PEEP)

The intention of this blog is to start some discussion on the best way for medium to large business and government to reduce their built environment carbon emissions. Each method discussed involves the analysis of buildings, project management, and funding. The inspiration for this blog came about as a result of a perceived increase in the number of Energy Services Companies (ESCO) offering free energy audits with guaranteed Energy Performance Contracts (EPC).

The energy/carbon saving options and how they relate to analysis, management and funding are summarised in the graphic below. (click diagram to enlarge)

I have developed the following decision tree to help guide an organisation to make an informed decision about what energy reduction strategy is best suited to the organisation in question. Once the decision meets a red box, exit the diagram for the description detailed in the corresponding section. (click diagram to enlarge)

A. Energy Services Company (ESCo) audit with guaranteed Energy Performance Contract (EPC), combined with a behaviour change program. This is a good solution for an organisation that does not have a lot of time left in their premises, whether rented or owned, but wants to reduce their carbon footprint and operational costs. Some companies offer free audits with free implementation through a pay as you save mechanism.

B. Independent energy audit with outsourced project management (no pay as you save or EPCs). This option gives a good degree of control to the environmental officer whilst relies much less on in house project management/organisation skills and energy efficiency knowledge. The independent audit does not hide behavioural change options that might be discarded under an ESCo type arrangement. Outsourced project management gives access to skilled contractors and correct specification of energy efficiency works. This option prefers not to pursue pay as you save schemes or EPCs because you feel the disadvantages out-way the advantages for your organisation.

C. Independent energy audit with outsourced project management (a decision about pay as you save schemes and EPCs can be made after the audit findings have been given). This option gives a good degree of control to the environmental/facilities officer whilst relying much less on in house project management/organisation skills and energy efficiency knowledge. The independent audit does not hide behavioural change options that might be discarded under an ESCo type EPC arrangement. Outsourced project management gives access to skilled contractors and correct specification of energy efficiency works. As part of the outsourced project management, pay as you save schemes can be investigated to reduce capital expenditure where appropriate.

D. Independent energy audits with in-house project management (no pay as you save or EPCs). This option is suited to organisations that have a strong green facilities management or environmental management arm. The independent energy audits give a good degree of control to the management in making recommendations that are in the best interest of the client organisation. With the project management fees absorbed by the organisation, there may be more budget for a more advanced energy audit, or more budget available for capital energy efficiency works. This option prefers not to pursue pay as you save schemes or EPCs because you feel the disadvantages out-way the advantages for your organisation.

E. Independent energy audits with in-house project management (a decision about pay as you save schemes and EPCs can be made after the audit findings have been given). This option is suited to organisations that have a strong green facilities management or environmental management arm. The independent energy audits give a good degree of control to the management in making recommendations that are in the best interest of the client organisation. With the project management fees absorbed by the organisation, there may be more budget for a more advanced energy audit, or more budget available for capital energy efficiency works. As part of the outsourced project management, pay as you save schemes can be investigated to reduce capital expenditure where appropriate.

F. Independent energy audit with outsourced project management. This option gives a good degree of control to the environmental officer whilst relies much less on in house project management/organisation skills and energy efficiency knowledge. The independent audit does not hide behavioural change options that might be discarded under an ESCo type arrangement. Outsourced project management gives access to skilled contractors and correct specification of energy efficiency works. In this option it is not recommended that pay as you save schemes are pursued. The significant budget and commitment to staying at the premises means that it is better for the organisation to invest its own capital to fully appreciate the cost savings. This gives the environmental and facilities management the most flexibility over the site and does not necessarily prioritise expensive control solutions over behavioural ones.

G. Independent energy audits with in-house project management. This option is suited to organisations that have a strong green facilities management or environmental management arm. The independent energy audits give a good degree of control to the management in making recommendations that are in the best interest of the client organisation. With the project management fees absorbed by the organisation, there may be more budget for a more advanced energy audit, or more budget available for capital energy efficiency works. The significant budget and commitment to staying at the premises means that it is better for the organisation to invest its own capital to fully appreciate the cost savings. This gives the environmental and facilities management the most flexibility over the site and does not necessarily prioritise expensive control solutions over behavioural alternatives.

H. Partnered energy efficiency program (PEEP). PEEPs build a close working relationship between the client organisation and the energy efficiency consultancy. In some cases this can involve embedding an energy efficiency engineer into a large business, but usually government authority, to provide on-going energy efficiency services. The roles of partnership are primarily focussed on conducting energy audits, and project managing prioritised measures. In addition to this the consultancy might provide logging services for mechanical and electrical equipment for before and after retrofit verification, proving technologies through trial installations, as well as providing access to expert advice through the experience and knowledge of the engineering company. PEEPs require a high degree of trust, good engineers, a focus on achieving fast robust results and a high degree of flexibility and responsiveness to change. The partnership can have milestones and performance reviews set to measure progress.

This entry was posted in Energy auditing. Bookmark the permalink.