Energy Management Systems are the new black

Corporate Energy Management Systems (EnMS) in Australia tend to lag behind the rest of the world. There are several reasons for this: for example, EnMS aren’t as sexy as shiny new solar panels or new manufacturing equipment, and many organisations don’t see how improving things like policies and documentation could drive energy reductions.

But that’s starting to change, thanks in large part to the new Energy Management Coaching program now being rolled out by the NSW Department of Planning, Industry and Environment.

What is an Energy Management System?

Sometimes the term Energy Management System is used to reflect a company’s vague ambition to become more energy efficient, or to describe an online platform that collects energy data. While these elements are part of it, true energy management is much more.

An EnMS, at its heart, involves shifting from ad-hoc energy management practices across siloed business functions to a systematic and integrated approach to energy performance driven by ongoing cycles of continuous improvement.

Key elements of an EnMS include things like:

  • developing an energy policy, to set the organisation’s strategic direction and publicly declare its objectives
  • assigning oversight of energy to a senior manager, to ensure energy gets discussed by key decision makers
  • setting Energy Performance Indicators (EnPIs), to help zero in on the key drivers of energy consumption.

Several standards, most notably ISO 50001:2018, offer a robust framework to develop an EnMS.

Many companies already track their energy usage on some level and undertake projects intermittently to improve energy efficiency, however there is usually no unifying strategy or organisational infrastructure that sits behind these activities. This explains why Australia’s recent obsession with energy auditing hasn’t improved our energy productivity: because companies lack the wherewithal to act on the energy efficiency opportunities that get identified in these audits. You can have all the energy analysis in the world, but if you don’t have senior management buy-in or an organisational energy target to point towards, it’s very hard to get a project off the ground.

How do Energy Management Systems help?

An effective EnMS results in ongoing cost savings, adjacent process improvements, increased business resilience, and improved competitiveness. It can also offer a relatively cheap approach to greenhouse gas emission reductions, thereby becoming an important part of a wider corporate sustainability strategy. Research suggests that average energy savings of around 15% are achievable by implementing an EnMS, although there are several examples where companies have saved significantly more than that.

In Australia the opportunity for gains remains particularly large, as we are one of the few countries where energy productivity actually got worse over the period from 2008 to 2016. EnMSs are now poised to help Australian businesses catch up.

Recent government programs

Governments are beginning to understand the importance of a robust EnMS for achieving energy and carbon savings. Point Advisory recently helped the NSW Government to develop its Energy Coaching program, which looks to quickly diagnose and address gaps in large energy users’ EnMSs. And in Victoria, it’s looking likely that large energy users will be exempt of their liabilities under the Victorian Energy Upgrades (VEU) scheme if they can demonstrate they an ISO 50001 EnMS in place.

We would like to see a continued focus on EnMS as we believe it’s the next ‘lowest hanging fruit’ in energy efficiency, and will enable deeper and more last greenhouse gas emissions reductions.

For further information about Point Advisory’s work in this area, contact Ross Tunmer.

Point Advisory is a leading sustainability services company

We work with the public, private and social sectors across energy, climate change, environment, economics, supply chain and human rights. As a certified BCorp™, we believe in creating a positive impact for our clients and broader society.  Our team of engineers, scientists, entrepreneurs, economists and practitioners combine deep technical knowledge with strategic and commercial acumen to deliver practical, effective solutions.