3.5 Establish energy baselines and performance indicators
What is this?
Energy baseline
The purpose of the energy baseline is to develop a starting point for measuring energy performance improvements. This can be a very complex subject but in this guide we are trying to simplify the process.
At the simplest level the baseline could be the total amount of electricity and other fuels consumed. in the year ending before the EnMS is implemented. The advantage of this is that future consumption is simply compared with this baseline year. The disadvantage is that it ignores the effects of the relevant variables. For example production output could have increased or decreased significantly and this could be the reason for the change in energy consumption rather than any actual change in energy performance.
Energy Performance Indicators (EnPIs)
The purpose of this activity is to identify a number of indicators of energy performance which will help you to be confident that performance targets are being met and if not to alert you of any problems at an early stage.
How to implement
There are various methods of measuring energy performance in organisations. The 3 most common are:
Trends in absolute consumption. As stated earlier this is very simple but does not take account of the effects of relevant variables on the amount of energy consumed.
Specific energy consumption: this is also simple being a ratio of energy consumption per unit of production or other output. It is not an accurate or helpful method as it does not take account of the relevant variables and typically gives a wrong and overly optimistic estimation of energy performance improvement. It is affected by baseload. but takes no account of this. It will not be used in this guide for these reasons. It is in common use in many large organisations and it is necessary to learn its weaknesses in order to move towards better methods. In a large number of organisations, there is a high energy base load or a complex mixture of products. In the case of the large base load the level of production activity has a large effect on this indicator, i.e. if production volumes increase the ratio decreases and appears to show an improvement in energy performance when none has occurred. These indices are very popular during times of growth as they tend to show improving performance but do the opposite in times of falling output. Baseload is that energy which is consumed when there is no productive activity. For example, it is the energy consumed when there is no production such as at night or during weekends. You can use any statistical software package to perform the regression analysis to establish the baseline. In this program we use the data analysis add-in for MS Excel. You will need to install this add-in which is a part of all MS EXcel programs.You will find instructions of how to add it in using a search of the internet. You can find help in Excel on how to perform multivariate regression and to interpret the results. Alternatively you can search online for multivariate regression training. There are many videos on YouTube. This link is useful for information about degree days: www.degreedays.net. It is beyond the scope of this guide to give complete details of how these methods work but some links are included below to allow the reader to go into more detail elsewhere http://www.em-ea.org/Guide%20Books/Book-1/1.8%20Monitoring%20&%20Targett..., http://www.energy-wise.eu/node/248.
Methods based on regression analysis: these take account of the relevant variables and will be used throughout this guide as the preferred method. There is extensive experience in the UNIDO energy management program of companies learning to use this method and using it to identify savings opportunities.
The best method of establishing a baseline is to use the relevant variables which have been established earlier to predict the amount of energy that should have been used and to compare it with what has actually been achieved. In this method the baseline is the best fit straight line on the scatter chart of variable against energy consumption. As performance improves this line will move downwards.
The most common and simplest energy performance indicator is conformance to financial budgets. In many organisations this might be interpreted as successful energy management. It is not! The overall purpose of the energy management system is to improve energy performance and to continually improve this performance.
Ideally you will have at least one high level EnPI for each energy source (electricity, fuel, etc) at the top level to indicate that overall you are in control. This is often very difficult depending on product and energy variable mix. You should also try to have an EnPI for each of your significant energy users.
It is important that you develop these indicators while you are planning and that you monitor them routinely once they are developed. The indicators may require modification once you start using them in order to improve their effectiveness in showing you how your organization is performing.
An example of a simple ratio which is commonly used and normally of little value is the specific energy consumption (SEC) of various utilities. As an example the SEC of compressed air in terms of kWh/Nm3 of air produced is used. This can be very misleading as, for example, if we repair leaks or reduce our air consumption, we will almost always increase the SEC. Thus increasing SEC can be an indicator of improving or worsening performance depending on the reason for the increase. The use of these ratios can divert attention away from truly indicative indicators of energy performance. Even simple annualised trends of energy use are often of more real value.
Note that the use of SEC is often perceived to be of value in plants where SEC of individual compressors can be established and their performance compared. However the cost of instrumentation (especially the air flow meters) involved will usually make this level of information uneconomical to establish. Note also that the SEC will vary depending on the output of the compressors making comparison even more difficult. The same applies to thermal efficiency of boilers and coefficient of performance of refrigeration plants.
You want to improve performance and demonstrate this performance improvement. In order to demonstrate it the slope of the regression line and/or its intercept with the Y axis will need to be reduced. It is beyond the scope of this guide to go into much detail on this topic. You will also use the principles of cumulative sum (CUSUM) to track performance on an ongoing basis.
Being able to show performance improvement is essential for getting or gaining management commitment. Management wants to see clear results and return on investment for the measures taken. When the energy performance results are polluted with other determinants that can’t be controlled, the shown performance result gives a false representation. In practise this is one of the causes for management not to invest in energy saving measures any longer since they do not seem to pay out. When it can be made clear that they do, but that other determinants affect the energy performance of the organization negatively, this will help to keep management commitment.
What is this?
Energy baseline
The purpose of the energy baseline is to develop a starting point for measuring energy performance improvements. This can be a very complex subject but in this guide we are trying to simplify the process.
At the simplest level the baseline could be the total amount of electricity and other fuels consumed. in the year ending before the EnMS is implemented. The advantage of this is that future consumption is simply compared with this baseline year. The disadvantage is that it ignores the effects of the relevant variables. For example production output could have increased or decreased significantly and this could be the reason for the change in energy consumption rather than any actual change in energy performance.
Energy Performance Indicators (EnPIs)
The purpose of this activity is to identify a number of indicators of energy performance which will help you to be confident that performance targets are being met and if not to alert you of any problems at an early stage.
How to implement
There are various methods of measuring energy performance in organisations. The 3 most common are:
The best method of establishing a baseline is to use the relevant variables which have been established earlier to predict the amount of energy that should have been used and to compare it with what has actually been achieved. In this method the baseline is the best fit straight line on the scatter chart of variable against energy consumption. As performance improves this line will move downwards.
The most common and simplest energy performance indicator is conformance to financial budgets. In many organisations this might be interpreted as successful energy management. It is not! The overall purpose of the energy management system is to improve energy performance and to continually improve this performance.
Ideally you will have at least one high level EnPI for each energy source (electricity, fuel, etc) at the top level to indicate that overall you are in control. This is often very difficult depending on product and energy variable mix. You should also try to have an EnPI for each of your significant energy users.
It is important that you develop these indicators while you are planning and that you monitor them routinely once they are developed. The indicators may require modification once you start using them in order to improve their effectiveness in showing you how your organization is performing.
An example of a simple ratio which is commonly used and normally of little value is the specific energy consumption (SEC) of various utilities. As an example the SEC of compressed air in terms of kWh/Nm3 of air produced is used. This can be very misleading as, for example, if we repair leaks or reduce our air consumption, we will almost always increase the SEC. Thus increasing SEC can be an indicator of improving or worsening performance depending on the reason for the increase. The use of these ratios can divert attention away from truly indicative indicators of energy performance. Even simple annualised trends of energy use are often of more real value.
Note that the use of SEC is often perceived to be of value in plants where SEC of individual compressors can be established and their performance compared. However the cost of instrumentation (especially the air flow meters) involved will usually make this level of information uneconomical to establish. Note also that the SEC will vary depending on the output of the compressors making comparison even more difficult. The same applies to thermal efficiency of boilers and coefficient of performance of refrigeration plants.
You want to improve performance and demonstrate this performance improvement. In order to demonstrate it the slope of the regression line and/or its intercept with the Y axis will need to be reduced. It is beyond the scope of this guide to go into much detail on this topic. You will also use the principles of cumulative sum (CUSUM) to track performance on an ongoing basis.
Being able to show performance improvement is essential for getting or gaining management commitment. Management wants to see clear results and return on investment for the measures taken. When the energy performance results are polluted with other determinants that can’t be controlled, the shown performance result gives a false representation. In practise this is one of the causes for management not to invest in energy saving measures any longer since they do not seem to pay out. When it can be made clear that they do, but that other determinants affect the energy performance of the organization negatively, this will help to keep management commitment.