Chapter 3: Sustainable Energy Management

Budget and Resources Management

While doing energy management, energy budget and resources management need to be proactively managed for effective EMS

• Energy budget is a part of an ecosystem of capital, operational, rebates, efficiency
targets and many other line-item costs. Companies develop budgets in order to
monitor progress toward their goals, help control spending, and predict cash flow
and profit.

• One approach to managing utilities better is through budget management which
involved a systematic method of allocating financial, physical, and human resources to
achieve strategic goals.

• Top managers need to translate strategy into milestones and metrics for utility costs.
Utility resources, whether for bills or for retrofits, need to be planned carefully. By
adopting these practices, companies can see a significant drop in their costs of utilities
and improve their carbon footprint.

Effective financial energy planning and budgeting requires:
• A thorough analysis of the costs and usage of energy incurred through energy supply contracts and through taxation schemes
• Coordination of the energy budget throughout the business as a whole
• Preparation of budgeting reporting data that shows estimated and actual budget performance
51 • Strategic and skillful budget management to deliver costs below the predicted budget each year

1. ENERGY MARKETS How to plan for good energy budget management???
Know what happened last year

How and whether your organization has been able to make the most of this decline will
depend on your contract terms and purchasing strategy.

2. COST and USAGE PROFILE
Understand your facilities and your cost.

Know the impact of energy costs on your budget last year.
Did your institution meet your budget goals over the past year? Were there any major changes
to usage or facilities? Did your energy usage profile change? Did your tariff or contract rates
change? Have you invested in renewable energy technologies or on-site generation? How will
these investments impact your budgets going forward?

3. EFFECTIVE FORECASTING
Develop a reliable forecast using forward looking data

Bring together a forecast of usage, a view of your contracted, un-contracted and utility
delivery costs and forecast your monthly budget accordingly. If possible, determine any risks
around those monthly costs and help your colleagues understand the risks to meeting your
budget goals. Track your costs monthly so that you can identify the cause and impact of any
deviation from your expected budgets.

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Learning Outcome:

3.5 Students should be able to understand energy management performance review - Performance review-strategy and approaches

Energy Management Performance Review

1. Review of energy policy, objectives, targets and evaluation of overall progress in achievement;
2. Findings of previous management review and Energy Management System audit;
3. Evaluation of the effectiveness of Energy Management System and energy performance;
4. Review of changes in: legislation, expectations and requirements of interested parties,

products / activities of the organisation, advances in technology, market preference, etc.
5. Evaluation of follow-up actions in relation to nonconformities;
6. Projection of energy performance in the next period;
7. Revision on policies, objectives, targets, resources or other elements of Energy Management

System , if necessary;
8. Review of resources allocation; and
9. Identification of room for improvement.

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Checking and Corrective Action

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Checking and Corrective Action

 The organization shall ensure that:

the key characteristics of its operations that determine energy performance are monitored,
measured and analysed

the equipment used in monitoring and measuring of key characteristics provides data which is
accurate and repeatable

Key characteristics shall include at a minimum:

the energy profile,
significant energy uses and
effectiveness of the action plans in achieving objectives and targets.

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SUMMARY :

The Success of an energy management strategy will depend on:

 full commitment from all staff in the organisation ranging
from senior management to production staff;

 an effective reporting system with accountability of line
managers for energy used; and

 an effective training program and staff motivation to save
energy.

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THANK YOU

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