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You can save millions in energy costs and reduce energy consumptions by up to 30%.

This year has been tough for the manufacturing sector. The business environment is forcing organization to think of energy as a controllable cost. However, many organizations are finding that their aging equipment and legacy IT systems are not capable of meeting this challenge. The perquisite of any successful energy management strategy is information. Information through systems integration — being able to monitor energy consumption in lighting, production and all other energy-consuming activities. As I proceed forward, I will unfold the key things you should take care of when building an energy management strategy – around energy information.

So, what are the technological and market changes that are driving this change:

  • The driver to be more competitive and environmental conscious company
  • A relatively low cost of metering and communication hardware has reduced payback time
  • Open standards that ensure communication between disparate systems
  • Cloud-based software-as-a-service (SaaS) offerings enable companies to increase their analytics capability without investing in IT infrastructure
  • Growing number of companies that have successful implemented energy management

Here is the list of questions you should ask to yourself and within your organization:

Q?
Can energy management become a competitive advantage for our organization?
A.
Management, in many organizations, is not aware of solutions that can turn energy management into a true competitive advantage. Technologies that can help you make operations more energy efficient. The first step is to look into your energy costs. Analyze the impact on your bottom line of reducing consumption by say 5%, 10%, 15%, 20% and 30%. This will give you an estimate of the cost savings and their impact on your competitiveness. Analyze your energy intensity - the energy use per unit of sales, services or products. This will help you set a benchmark that is difficult for your competitors to achieve.
Q?
Do we have the competency to create this competitive advantage?
A.
At times good business ideas are dropped due to lack of competency. Ask yourself “Do we have this competency within our organization?” If no, bring in a good system integrator who can help you implement a solution that works. Many organizations in this situation often rely on popular brand solutions. Such solutions may be easy to justify but they may not deliver the results. It is better to bring in a system integrator and design a solution what works for your organization. Don’t just buy the most popular or the cheapest solution. You will agree - “I need a cost effective energy management system.” is not the right driver. The right business driver is - “I need an energy management system that fits my organization need and will provide the best ROI.”
Q?
What kind of technology will I need?
A.
The era of desktop applications is ending, today an application that cannot connect, communicate with the entire organization – people, machines and enterprise application- is of no use. Whatever you choose, but do not choose technology that will contain the information to an individual or worse to a desktop. Do not choose hardware that has proprietary protocol and only works with the hardware vendor’s software. They should have an open communication protocol that you can use with other software solutions. Example MODBUS is a good open communication protocol for energy meters. The software should provide an API to extend and integrate the solution.
Q?
Have we involved the IT team?
A.
I have found that most of the time the IT department is not involved in the selection process. The IT technology used to support energy management initiatives such as real-time energy monitoring, energy analytics, and reporting will decide your company’s success. You are not buying a piece of hardware or an automation application – you are buying an energy information and intelligence system. Your IT team will help you in selecting the right solution. One of the top reasons for energy management initiatives failing is that the IT team is not involved.
Q?
Will it work well with my current system and still help me meet the future demands?
A.
Your organization runs on a certain ERP or business intelligence package. Any solution the system integrator proposes should have the capability of integrating with it. Do not buy hardware and software that do not provide API access. Without an open API, you have restricted your ability to invent and improve. This will also help you in future expansion or in modifying the system with ease. With open communication standards, you can build on the investment instead of replacing it with a new system.
Q?
Do we have realistic goals? Make energy conservation an ongoing task.
A.
Start with a realistic plan. Do not think that implementing an energy management system is the end goal. It is just the beginning. The goal is to reduce energy costs and convert it into competitive advantage. You should plan for realistic and measurable results. Create key performance metrics that can help you track progress. Key energy metrics that provide answers like – “Has energy consumption for the chiller plant really dropped or is it due to a cooler weather” - “Has the new VFD on the assembly line reduced consumption as promised.” – “Is my progress real and in the right direction and where am I lacking.” Armed with enterprise-wide, web-based analytic tools, you team performs continuous evaluation and takes the necessary actions. And builds energy management into a competitive advantage.