Energy management is the process of tracking and optimizing energy consumption to conserve energy usage in a building or other controlled system, such as transportation or domestic dwellings. The common steps in the process of energy management include the collection and analysis of continuous data; the identification of optimization opportunities in equipment schedules, set points, and flow rates for improved energy efficiency; calculating return on the investments with units of energy saved, metered, and calculated like units of energy delivered; the execution of the energy optimization solutions; and a repetition of all the steps to continue to optimize energy efficiency.
Energy management as a support function in industrial companies has developed considerably. Energy, as an input factor in the industrial production process, has largely had low to no priority for those companies and their management bodies, because energy has historically been a small part of total production cost since energy prices have been low and have remained stable.
The energy management process works to control and reduce a building's energy consumption and reduce the costs, carbon emissions, and risks associated with energy supply shortages for a building owner or manager. This works to achieve the often cited objectives of energy management of resource conservation, climate protection, and costs savings, without sacrificing the access to the energy necessary to keep an industrial, commercial, or residential building operating. It is also connected to environmental management, production management, logistics, and other established business functions.
Furthermore, a definition for the economic dimension and objective of energy management was released by the VDI-Guideline 4602. This went on to define energy management as:
The proactive, organized, systematic coordination of procurement, conversion, distribution, and use of energy to meet the requirements, taking into account environmental and economic objectives. It is often a systemic endeavor to optimize energy efficiency for political, economic, and/or environmental objectives through engineering and management techniques.
This, and similar objectives, sees companies across sectors turn to energy management principles and systems to reduce their operating costs. Specific requirements and practices differ by sector, but the core principles apply to all companies. With the growing demand for energy and the seeming shrinking supply of non-renewable energy sources, combined with the inconsistent delivery of renewable energy sources, the ability to manage the demand and delivery of energy has also increased in importance—especially as the costs of energy rise. Further, regulators globally have begun to push for more stringent sustainability targets, which are expected to further increase energy costs.
Example of the continuous energy management process.
Energy management is, at its simplest, a consolidation and analysis of an energy spending profile over time, which can be done from a manual data collection and analysis and monitoring of that data as a basis for an energy management profile. However generated, once a profile is developed, it can help move users toward informed decision making that can move to reduce energy use. More developed energy management systems can further use software to automate the process of data collection to data analysis to data reporting. This can translate into four simple steps of basic energy management processes.
This refers to the collection of as much data from an organization or an individual in their energy use, including from monthly utility bills, from manual meter checks, or from automatic uploads from smart meters. Detail at this stage is extremely important, as a lack of detail, such as time, area, and type of energy used can frustrate and complicate energy management systems. Using smart meters, which often work to capture these kinds of data, offers information that can be viewed and processed through software platforms.
This stage can also include site inspections and real-time monitoring equipment to develop data for areas or energy uses that may otherwise not be captured. This can include:
- Historical energy consumption and cost analysis
- Electricity demand analysis
- electricity power factor analysis
- Greenhouse gas emission calculation
- Climate normalization of energy consumption
- Energy cost development and forecasting
- Real-time monitoring of major electrical loads
- Load shifting analysis
- HVAC performance analysis
- Operational efficiency analysis
At this stage, a user or a software platform can be used to analyze the data collected in order to identify opportunities for increased optimizations. This process can be furthered with visualizations and analytics to pull patterns from the raw data and communicate them more effectively. Although, even the use of data in a spreadsheet with year-on-year comparisons can offer a starting point for generating insights into energy use. When using software, often these systems can help visualize trends, break data into metrics, and assess performance against benchmarks.
This stage can be helped through concise reporting that provides a prioritized list of energy cost reduction opportunities, operational opportunities for energy reduction, an economic analysis of savings potential, and a calculation of payback periods for any potential equipment replacements or upgrades.
Once the opportunities are identified, an organization or individual can act on those opportunities through the development and implementation of an energy management strategy. This could include one-off fixes or could require internal cooperation and persuasion. These thoughts could be for changes that offer savings opportunities but may not be favored by all parts of an organization. This is also where it is useful for software to be capable of generating easy-to-understand visualizations.
The development of a strategy could also include feedback from facility management and site staff in order to understand how well the strategy is working and what could be compromised by a strategy. Further, a development of key performance indicators, which could be based on organizational goals or efficiency goals, can provide feedback for the effectiveness of the implementation of the system. This feedback can in turn be used to improve energy efficiency and identify systems or equipment that need replacements or upgrades that may have been missed earlier, and ensure any predicted energy savings are actually occurring.
This can also build upon the systems established for the tracking of the energy optimization solutions. It also ensures the initiatives are successful and are establishing a way to verify the success. In the case of energy management systems or software, these systems often offer regular performance reports and alerts in the situation of an energy management system failing or working incorrectly.
An energy management system (EMS) is a system of computer-aided tools used by those operating electric utility grids to monitor, control, and optimize the performance of the generation and transmission of electricity power. It can also be used in small-scale systems like microgrids. Furthermore, these and related systems are used by the energy producers and energy consumers to react to energy demands and, for consumers, to increase energy efficiency through the reporting on granular energy use and energy equipment. These systems have developed into cloud-based platforms, which can offer suggestions to both producers and consumers to increase energy efficiency, collect energy use data, and provide visualizations for those data. Popular versions of these systems include home energy management systems, energy management information systems, and energy management control systems.
Home energy management (HEM), intended for use by domestic consumers, works to offer a chance for domestic consumers to manage their energy consumption and efficiency and, in some cases, control where the energy is purchased from in similar ways to industrial and commercial applications. These systems can, as IoT devices and connected appliances grow in popularity and use, offer more granular control of energy use while maintaining a standard of comfort.
Energy management information systems (EMIS) are performance management systems that allows individuals and organizations to plan, make decisions, and take actions to manage energy uses and costs. An EMIS can make energy performance visible to different levels of an organization by converting energy and utility driver data at energy account centers into energy performance information. This can be done through performance equations compared with an organization's energy targets.
Similar to energy management information systems, energy management control systems (EMCS) can monitor and control an individual building, groups of buildings, a campus, or any combination of energy consuming facilities from either a centralized or decentralized location anywhere. These systems are intended to create energy savings by monitoring functions. A smaller version would be a home energy management system. Most EMCS are designed to utilize copper, fiber, intranet, and internet communication paths.
These systems have evolved beyond early versions used from around the 1970s, which turned on and off devices based on need and ease of remote operation rather than through an effort to control energy use. Second generation EMCS took advantage of increased computation, were able to convert electric signals to pneumatic operations of valves to dampers, and allowed building to perform proportional control. These systems were succeeded by further advances in computation and electric actuators in place of pneumatic devices, and with an increased use of digital controllers, which offered finer control of systems and improved control strategies. These systems also brought with them graphical data representations.
These were further succeeded by systems with more control strategies focused on more communication technologies and with more systems and equipment operating over internet protocol (IP), which can reduce overall plant wiring and installation costs while delivering a network-based system capable of reporting information and executing control demands as the business requirements and energy management expectations require.
For any management system, there are certain devices that can aid in energy management. These devices can be for smaller buildings, such as homes, and for larger buildings, although some have better use cases than others. This includes devices such as solar panels, which can contribute to energy consumption optimization; battery storage, which can minimize energy loss; solar thermal, which can use solar energy to heat and maintain the warmth of water; smart plugs, which can work in scheduled on-and-off regimes to reduce power draw in off times; and smart hubs, which can manage internet of things (IoT) devices to create a smart connected building or home and control all related systems. These devices can benefit the following:
- Energy waste optimization—where users can prevent overconsumption and cover the loss of wasted energy generated
- Cost reduction—with better managed expenses on heating, cooling, lighting, and water supply, this can free funds for more critical business needs
- Better return on investment—this financial indicator can improve based on waste management and leak prevention
- IoT-based analytics—where users can better understand and have a detailed picture of energy consumption with the data collected by devices around a building
- Internal control improvement—energy management can also improve the well-being of in-house workers, thanks to better lighting conditions and temperature control
- Easy access—an energy management system will offer all energy-related information in a visible and often easy-to-use interface for further reporting and making predictions
- Better branding—using an energy management system can contribute to creating an eco-friendly public image of a business
- Greater sustainability—in which an energy management solution can minimize a business's carbon emissions and offer a green yet economically efficient option for industrial organizations
