How to ensure savings realisation in energy efficiency projects

by | Mar 1, 2021 | Energy Efficiency

Is your plant performing as expected? Are your energy efficiency projects really saving energy?

And, more to the point, how confident are you of your investments in them?

Sure, there are loads of protocols, standards, and methodologies floating around, but the real challenge is a lot more basic – unless you identify your baselines, you’ll forever be winging it blind.

Managing change and development within an organisation can be tough. It not only takes considerable thought and time, it also requires enabling and supporting individuals to adopt the change. And the change itself must drive measurable and positive outcomes.

Is all your organisation’s data providing the maximum value it can?

Using “70% of changes fail” as an excuse doesn’t fly anymore. In the data-driven world we have today, it just sounds lazy. That said, what is true is that data by itself does nothing for you to help change this outlook on change management. Too many of us, having scrambled and clambered onto the digitization bandwagon years ago, got complacent and are just sitting on all the data we’ve been collecting since.

What are your KPIs not telling you?

The truth is, data only offers value if you probe it for insights – and it’s no different for your energy efficiency projects. For instance, have you ever wondered why your energy efficiency initiatives look fine at times, and then look like they are failing miserably at other times? Are your KPIs telling you the truth, the whole truth and nothing but the truth? Can you trust your KPIs to evaluate whether your initiatives are performing as expected in the depths of winter and the soaring heat of the summer? How can you find out if they could in fact have fared better?

It’s surprising how laid back so many manufacturers still are about energy efficiency, and true performance, despite it being not only an increasingly mandatory initiative, but an immensely attractive investment – one that can pay for itself over a very short time period. Granted, evaluating, measuring, and verifying what has not not happened is harder than doing the same with actual consumption or output – but the fact remains that unless you do, you have no way of finding out if your investment is even justified.

The KPI Dilemma

One of the biggest challenges that many manufacturers face is not how to measure, but what to measure, and what to measure against. When you start off with a data-led initiative, you may not have a predetermined baseline to reference against. However, you may still have a data-based savings potential developed through an energy framework such as ISO 50001.

To demonstrate the performance of a complex process you need a sophisticated KPI that can simultaneously account for multiple factors influencing performance, and an equally sophisticated platform that can automate the entire process of evaluation, measurement, and verification for you…  The traditional ‘energy’ per ‘product’ ratio KPI, so commonly utilised throughout business and engineering reporting, just doesn’t cut it on it’s own.

What is M&V and energy modelling, and why do you need it?

M&V is an objective process that works to quantify energy savings achieved via Energy Conservation Measures (ECMs). It involves measuring and verifying energy use before as well as after implementation, while allowing for any significant changes in other conditions that may impact the values. M&V is a collection of processes deployed to evaluate the performance of energy efficiency initiatives, so that their effectiveness can be improved to help achieve planned results.

Essentially, M&V processes aim to measure energy savings and verify them against the expectations of a baseline energy model. In addition, the energy model can inform recommendations for performance improvements.

An energy model and M&V plan will provide you with the following key valuable benefits:

  • Quantified energy savings
  • Estimation of further savings potential (energy as well as cost) and identification of new, feasible EEMs
  • Evaluation and validation of previous as well as ongoing projects
  • Benchmarking against baselines identified for each utility
  • Generation of, and visibility into, reliable reports on investment returns
  • Adaptability to changing operating conditions, allowing for proper budgeting – and accounting for variances

However, for an M&V process to be effective, it’s critical to have a clear understanding and plan for how the program being evaluated is expected to deliver results.

So, how does an M&V work?

The first step of an M&V process is evaluation, which consists of a review of the energy efficiency program in its entirety, including its implementation, cost-effectiveness, stated objective, and potential savings.

The next step is baseline measurement. When starting out with assessing a new ECM, an M&V plan estimates the initial measurements at the planning stage. These metrics are then reviewed at regular intervals following program implementation to determine if the levels of energy savings are up to the set expectations. Energy consumption and cost measurements are recorded (or estimated) in two contexts – one, prior to implementation (to establish the baseline), and two, after the implementation (to identify savings achieved). Additional data may also be documented as required to accurately estimate potential savings over time. For instance, other factors that affect energy usage, such as weather (which affects temperature-sensitive processes, for instance, spray-drying a drug formulation) may be recorded and analysed to estimate savings.

Verification is carried out after a program has been implemented for a certain period of time. Verification activities seek to validate the savings estimated using the data collected at the initial stages of the program, and to confirm that the program has been properly installed and implemented.

The energy savings realised as a result of a successfully verified ECM reflect the difference in the energy consumption of an existing equipment or process and that of the ECM (whether in the form of an upgraded system or a replacement), allowing for any major factors that affect the savings estimate. For instance, for a program to replace an HVAC system, the M&V process may most likely involve direct metering of the current HVAC unit, followed by the metering of its replacement and an analysis of any additional metrics that affect equipment behaviour.

The M&V process: Four steps

Step 1: Identifying baselines and estimating savings.

This is when baselines, such as equipment conditions and energy consumption rates, are identified via inspections, spot and short-term metering, and data analysis. Once baselines are defined and established, savings can be estimated. However, baselines also need to be adjusted to accommodate varying operational conditions over time. Since baselines are critical to all consequent measurements and analytics, it’s important to ensure that they are defined accurately at the start. Therefore, it is absolutely necessary to do a thorough analysis of everything that has to be monitored, the level of complexity involved, the durations for which monitoring has to be done, the varying loads and operating hours of the equipment, and all other influencing factors.

Step 2: Creating the Measurement and Verification plan.

This is where you set the plan for how the ECM will be audited. Typical activities include:

  • Detailing of baseline conditions and approach to data collection
  • Exhaustive documentation of all data sources and assumptions
  • Listing of metrics to be verified
  • Identification of responsible personnel for measurement and verification activities
  • Scheduling of measurement and verification activities
  • Detailing of algorithms used for energy savings calculations and estimations
  • Documentation of operations and maintenance activities
  • Format finalization for all reports
  • Determination of when, why, and how baseline adjustments may be made

Step 3: Actual Measurement and Verification

Besides automatic, ongoing metering, this may take many additional forms, including spot inspections, surveys, and sample metering. The goal of this step is to ensure that all equipment is properly installed and functioning according to expectations – meaning that the entire setup has the potential to generate the projected savings.

Step 4: Annual measurement and verification

In addition to regular metering and verification, there should be scheduled checkpoints at least once a year, when all systems are verified for proper maintenance, operations, and capacity to continue generating the projected savings. Though an annual report should validate savings guarantees, it is recommended that more frequent verifications be conducted to allow for necessary adjustments through the year based on operational changes. This also helps avoid unpleasant surprises at the last moment.

Ensure your approach is data-driven to meet energy efficiency savings

The traditional definition of – and approach to – change management is outdated, not to mention severely lacking, in today’s times. What’s more, energy optimisation is no longer an optional change for any of us – it’s not only mandatory, it should have been achieved yesterday. To stand a chance of successfully making a go at it at this point of time, you need to rely on an intelligent approach that’s completely driven by data.

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