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Energy Costs: Balancing The Energy Equation

Part 1: Energy Master Plan Can Help Manage Costs On Demand Side, Supply Side

Part 2: Demand Side Management Helps Cut Energy Consumption, Costs

Part 3: Retrocommissioning Is Often Overlooked Way To Manage Energy Costs


Energy Master Plan Can Help Manage Costs On Demand Side, Supply Side

By John Lembo - April 2014 - Energy Efficiency


Managing and reducing the cost and consumption of energy and water are integral to a facility manager's responsibilities. Although many organizations, especially larger ones, have instituted the position of energy manager, the facility manager is tasked with operating efficient systems and reducing consumption and cost. To achieve this, a master plan should be developed that focuses on two distinct components:

1. Supply Side — How fuel, water, and power are acquired.

2. Demand Side — How fuel, water, and power are consumed and the operation and maintenance of the systems and equipment as well as on-going sustainability practices.

Together with an energy manager, upper management, occupants, and facility staff, facility managers can develop this comprehensive plan for managing the cost and consumption of fuel, water, and power, and work to achieve high performance environments for their occupants.

Supply Side

The supply of energy and water is one of the most important aspects of not just reducing cost in an organization, but also simply running an organization. An organization grinds to a halt without these critical services. It is incumbent upon facility managers to understand and manage the water and energy supply effectively.

Water Supply: Most organizations are on a regulated water and sewer service. Water is delivered to the facility and metered in hundreds of cubic feet (Ccf) or gallons per day (gpd), depending on the utility. Water costs, much like energy costs, vary throughout the country. Water is measured in most cases by what is consumed. Most utilities give a sewer credit for cooling tower evaporation, so it is important to reach out and have cooling tower make-up metered to take advantage of this.

Energy supply is a complex concept. How energy is delivered to a specific environment varies from location to location; electricity, natural gas, fuel oil, and propane all have unique distribution networks and elaborate cost structures associated with them. A great deal of supply-side management should be left to professionals who deal with the nuances of the markets and can best provide support in this arena. It is, however, important to understand the delivery mechanisms, such as utility distribution of electricity and natural gas, delivery of fuels by suppliers, and whether or not there are opportunities to negotiate costs, such as whether the supply is unbundled from the delivery and if third party suppliers of commodities such as electricity and natural gas can be chosen in a specific area.

If we truly consider how energy is supplied to a facility, we must also consider on-site generation through the use of combined heat and power (CHP) plants or distributed generation using prime movers such as engine generators, turbines or even renewable sources such as photovoltaic arrays, solar thermal, wind, geothermal, etc. These forms of energy supply do not require utility connections — most will have them for backup anyway. That's because power and thermal output are generated onsite. As in the case of supplier-provided energy, professionals, skilled in these technologies and their implementation, will provide support and in some cases actually own and operate the respective plant. They'll then sell the output, essentially becoming that site's utility service provider for that aspect of power or thermal energy. These are complex contracts and should be entered into after significant due diligence is performed by technical, business, and legal personnel.




Energy Costs: Balancing The Energy Equation

Part 1: Energy Master Plan Can Help Manage Costs On Demand Side, Supply Side

Part 2: Demand Side Management Helps Cut Energy Consumption, Costs

Part 3: Retrocommissioning Is Often Overlooked Way To Manage Energy Costs


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