Iso 50001 Energy Management
Content
ISO 50001 Energy Management
Continuous Improvement Driving Financial Results
Don Macdonald Director of Sustainability & Energy Services Jerry Skaggs Product Manager UL DQS, Inc.
1
Executives Seek Certainty
“Specific operational strategy must be the key part of the Energy Policy and M & V Strategy…done properly, will lead to a positive ROI on the overall Benchmarking, Certification or Non-Certification process”
2
Source: McKinsey
Executives Seek Certainty
3
Source: McKinsey
Executives Seek Certainty
4
Source: McKinsey
Benchmark your EnMS Maturity
5
Who are the Decision Makers
6
Organizational Barriers to Energy Management
• Energy not valued as an organizational ‘currency’ • Continuous monitoring, metrics and performance measurement absent • Economic performance, financial and qualitative benefits (ROI) absent • First costs more important than recurring costs • Disconnect between capital and operating budgets • Technical training lacking • Sustainability “culture” immature • Deep Process quality management systems not embedded • Stakeholders focus on production and not efficient use of energy or resources • Functional silo’s vs. cultural silo’s • IT data, monitoring and systems
7
Energy is the Strategic GHG & Climate Driver
‘Uncertainty in carbon markets, environmental regulations, concerned investors, climate change policy pose risks that cannot be managed using existing norms and procedures’
8
Harnessing the Power of Process
Business processes for competitive advantage: • Six Sigma • Lean Manufacturing • Continuous Improvement
40% 35% 30% 25% 20% 15% 10% 5% 0% Energy Management Standard Continuous Improvement ISO 9001 or 140001 Six Sigma Lean
• ISO 9001 • ISO 14001 • Plan-do-check-act
Formal energy management standards (ANSI, BSI):
JCI, 2011
9
Comprehensive Energy Management- RARE
JCI Study - 83 Organizations surveyed…
40 35
• Training for employees: 76%
• • • • • • • • • Formal review of energy policy: 47% Incentives for energy efficiency success: 45% Effective & empowered energy team: 41% Enterprise level energy data: 29% Corporate reduction goal: 28% Energy action plan for organization: 28% Formal energy policy: 27% C-level responsibility: 27% Adopted energy standard: 27%
Number of Organizations
30 25 20 15 10 5 0 0-2 3-4 5-6 Energy Management Score 7-8
Result: Mixed Practices
9-10
JCI 2011
10
Energy Investments & Operations
•Impact is multi-dimensional, each organization unique. •Facility, engineering project specification and procurement staff critical links •Foundational tools (metrics, baseline and verification) are critical.
Source: UNIDO 2010
11
Quality Systems & Shareholder Value Linkage
Drive Return on Investment (ROI) across manufacturing & operating silos:
• Process level execution critical to performance • Continuously managed energy processes: • Reduce exposure to energy costs (Internal hedging and volatility management) • Reduce carbon related emissions without negative effect on operations • Continual improvement of energy intensity • Value both avoidance & savings for internal and external metrics (e.g. emissions, utility credits, reduced labor intensity, CAPEX, etc.)
12
Energy Benchmarking
“ ISO 50001 provides a proven model that helps organizations
systematically plan, benchmark and manage energy use.”
ISO/PC 242 Chair, E. Pinero.
13
Market Adoption Indicators
ISO 9001 ROI benchmarks 9-13% • MNC’s mandated or implied Tier 1 & 2 adoption • Competitive advantage & supply chain drivers added further incentives • Operational benefits realized but marginally documented • No real performance metrics ISO 14001 ROI Benchmarks 7-12% • Similar drivers as ISO 9001, plus • Environmental responsibility • Evolving into CSR & CSV • No real performance metrics ISO 50001 • Published ROI Data Suggests 6.5-17% range expected within 1-2 yrs • Performance metrics (self-defined) incorporated • Web-based & continuous performance tools • Measured benchmarking • Compatible with ISO 9001, 14001, & SEP
Quality Mgmt
Environ Mgmt
Information Security
Energy Mgmt
Risk Mgmt
Procurement
14
U.S. Pilot Facilities Adopting ISO 50001 & SEP
Commercial buildings piloting Superior Energy Performance: •Cleveland Clinic •US GSA •Grubb & Ellis Company •Marriott International, Inc. •MIT Campus’s •Target Corporation •Wal-mart Stores, Inc. • 3M • Alcoa • Allsteel • Amcor PET • Bentley Prince Street • Bridgestone Tire • Cook Composites • Didion Milling, Inc • Dow Chemical • Eaton • General Dynamics • Free scale Semi • Haynes International • Holcim • JR Simplot • Lockheed Martin • Cooper Tire • • Kenworth Trucks Neenah Foundry Company
• Nissan • Owens Corning • Nissan • Schneider Electric • Spirax Sarco • Traco • Volvo • World Kitchen
15
June 2011
SEP & ISO 50001 Energy Management
Benefits of an effectively implemented EnMS can include:
Reduced operational and overhead costs → increased profitability
• • • • Reduced air emissions, such as GHG Increased efficiency of energy sources Increased assurance of legal, internal compliance Variables affecting energy use and consumption are identified
ISO 50001 is a foundational tool that any organization can use to manage energy. Components in place: • Baseline • Policy • Plan • Team/Leader
Superior Energy Performance
Facility-level conformance to ISO 50001 with validated energy performance improvement
ISO 50001
ISO 50001
DOE, 2011
16
ISO 50001 Key Elements
• • • • • • • • • • Energy policy Cross-divisional management team Energy review Baseline (s) Energy performance indicators (EnPIs) Energy objectives and targets Action plans Operating controls and procedures Measurement and verification Reporting of progress
17
Step 1 – Commitment Step 2 - Data Step One:
Secure Commitment from Top Management
• Set Energy Policy • Define Scope and Boundaries
Step Two:
Collect, Track, and Analyze Energy Data
• Current and past energy use, consumption • Estimate future energy use, consumption
18
Step 3 – Energy Use Step Three:
Identify Key Energy Uses • • • • • • Facilities Systems Equipment Processes Personnel Relevant Variables
19
Step 4 - Baseline
Step Four:
Establish a Baseline
• • • • Reference point for energy performance Outlines current energy performance Predicts future energy performance Provides benchmarking method
20
Step 5 - Opportunities Step 6 - Prioritize Step Five:
Identify Energy-Saving Opportunities
• • • New Sources Renewable Sources Alternative Sources
Step Six:
Prioritize Opportunities
• Return on Investment • Ease of Implementation
21
Implementation and Operation
• Competency, Training and Awareness • Communication • Documentation, Control of Documents
• Operational Control • Design • Procurement
22
Checking and Management Review
• Monitoring, Measurement and Analysis • Evaluation of Compliance • Internal Audit • Non-Conformance, Correction, Corrective and Preventive Action • Control of Records • Management Review
23
EnMS and Other Standards
ISO 9001:2008 •Design •Procurement ISO 14001:2004 • Legal, Other requirements • Significant Energy Use • Objectives, Targets, Action Plans • Evaluation of Compliance
24
• Capital asset planning • Production Process Planning • Carbon & GHG • Waste reduction • Supply chain marketability • New product/service opportunities • Employee engagement • Retail: market differentiation
Recent Case Studies & Results
25
Example Results – AU Optronics, Taiwan
• LCD TV’s – Taiwan, Province of China ISO 50001 implementation achieved 10 % energy conservation at the plant this year, save an estimated 55 million kWh of electricity and reduce carbon emissions by 35,000 tons. • The company now plans to adopt an ISO 50001based energy management system at all its manufacturing plants.
26
Example Results – Dahanu Power Station, India
The plant conducted a series of targeted investments since March 2010 which, aided by the organization’s new ISO 50001-based energy management system, are expected to yield annual savings of about INR 96.4 million ($1.9M USD) from raised energy efficiency and management.
27
Example Results – Schneider Electric US
ISO 50001 & SEP Program demonstrate exceptional savings at its flagship manufacturing plant in USA. Example: $27,000 USD savings annually from VSD installation, lighting, heat recovery. Plus a new 1MW solar field and additional savings from other projects yet to be announced estimated greater than 10%. Payback range avg. 18 months. 90% of worldwide facilities are ISO 140001 certified.
28
Example Results – Delta Electronics, China
With the implementation of the ISO 50001 energy management system in the Dongguan region, and production capacity at an even level from January to May of this year, we have already reduced power consumption by 10.51 million KWH as compared to the same period in 2010. This is equivalent to a reduction of 10.2 thousand tons of carbon emissions and a saving of CNY 8 million ($1.6M USD)
29
Example Results – Municipality of Bad Eisenkappel, Austria
During the first year, consumption of electrical energy decrease by nearly 25 % with the main savings achieved by updating the waste water plant and reducing energy consumption by 86, 000 kWh equivalent to just over $21,400 USD.
30
Example Results – Cook Composites & Polymers, US CCP’s Houston plant attained SEP Gold Certified Partner status and achieved a 14.9% improvement in energy efficiency over a two-year period. The energy efficiency measures taken by CCP resulted in 31,700 million British thermal units of energy saved and allowed the company to capture $250,000 in cost savings per year.
31
UL DQS Inc. ISO 50001 Tools
UL DQS offers: Practitioner’s Guide & Self Assessment Tool
Practitioner’s Guide
Scorecard Tool
32
[email protected] 800.285.4476 x3328 www.ul-dqsusa.com
Continuous Improvement Driving Financial Results
Don Macdonald Director of Sustainability & Energy Services Jerry Skaggs Product Manager UL DQS, Inc.
1
Executives Seek Certainty
“Specific operational strategy must be the key part of the Energy Policy and M & V Strategy…done properly, will lead to a positive ROI on the overall Benchmarking, Certification or Non-Certification process”
2
Source: McKinsey
Executives Seek Certainty
3
Source: McKinsey
Executives Seek Certainty
4
Source: McKinsey
Benchmark your EnMS Maturity
5
Who are the Decision Makers
6
Organizational Barriers to Energy Management
• Energy not valued as an organizational ‘currency’ • Continuous monitoring, metrics and performance measurement absent • Economic performance, financial and qualitative benefits (ROI) absent • First costs more important than recurring costs • Disconnect between capital and operating budgets • Technical training lacking • Sustainability “culture” immature • Deep Process quality management systems not embedded • Stakeholders focus on production and not efficient use of energy or resources • Functional silo’s vs. cultural silo’s • IT data, monitoring and systems
7
Energy is the Strategic GHG & Climate Driver
‘Uncertainty in carbon markets, environmental regulations, concerned investors, climate change policy pose risks that cannot be managed using existing norms and procedures’
8
Harnessing the Power of Process
Business processes for competitive advantage: • Six Sigma • Lean Manufacturing • Continuous Improvement
40% 35% 30% 25% 20% 15% 10% 5% 0% Energy Management Standard Continuous Improvement ISO 9001 or 140001 Six Sigma Lean
• ISO 9001 • ISO 14001 • Plan-do-check-act
Formal energy management standards (ANSI, BSI):
JCI, 2011
9
Comprehensive Energy Management- RARE
JCI Study - 83 Organizations surveyed…
40 35
• Training for employees: 76%
• • • • • • • • • Formal review of energy policy: 47% Incentives for energy efficiency success: 45% Effective & empowered energy team: 41% Enterprise level energy data: 29% Corporate reduction goal: 28% Energy action plan for organization: 28% Formal energy policy: 27% C-level responsibility: 27% Adopted energy standard: 27%
Number of Organizations
30 25 20 15 10 5 0 0-2 3-4 5-6 Energy Management Score 7-8
Result: Mixed Practices
9-10
JCI 2011
10
Energy Investments & Operations
•Impact is multi-dimensional, each organization unique. •Facility, engineering project specification and procurement staff critical links •Foundational tools (metrics, baseline and verification) are critical.
Source: UNIDO 2010
11
Quality Systems & Shareholder Value Linkage
Drive Return on Investment (ROI) across manufacturing & operating silos:
• Process level execution critical to performance • Continuously managed energy processes: • Reduce exposure to energy costs (Internal hedging and volatility management) • Reduce carbon related emissions without negative effect on operations • Continual improvement of energy intensity • Value both avoidance & savings for internal and external metrics (e.g. emissions, utility credits, reduced labor intensity, CAPEX, etc.)
12
Energy Benchmarking
“ ISO 50001 provides a proven model that helps organizations
systematically plan, benchmark and manage energy use.”
ISO/PC 242 Chair, E. Pinero.
13
Market Adoption Indicators
ISO 9001 ROI benchmarks 9-13% • MNC’s mandated or implied Tier 1 & 2 adoption • Competitive advantage & supply chain drivers added further incentives • Operational benefits realized but marginally documented • No real performance metrics ISO 14001 ROI Benchmarks 7-12% • Similar drivers as ISO 9001, plus • Environmental responsibility • Evolving into CSR & CSV • No real performance metrics ISO 50001 • Published ROI Data Suggests 6.5-17% range expected within 1-2 yrs • Performance metrics (self-defined) incorporated • Web-based & continuous performance tools • Measured benchmarking • Compatible with ISO 9001, 14001, & SEP
Quality Mgmt
Environ Mgmt
Information Security
Energy Mgmt
Risk Mgmt
Procurement
14
U.S. Pilot Facilities Adopting ISO 50001 & SEP
Commercial buildings piloting Superior Energy Performance: •Cleveland Clinic •US GSA •Grubb & Ellis Company •Marriott International, Inc. •MIT Campus’s •Target Corporation •Wal-mart Stores, Inc. • 3M • Alcoa • Allsteel • Amcor PET • Bentley Prince Street • Bridgestone Tire • Cook Composites • Didion Milling, Inc • Dow Chemical • Eaton • General Dynamics • Free scale Semi • Haynes International • Holcim • JR Simplot • Lockheed Martin • Cooper Tire • • Kenworth Trucks Neenah Foundry Company
• Nissan • Owens Corning • Nissan • Schneider Electric • Spirax Sarco • Traco • Volvo • World Kitchen
15
June 2011
SEP & ISO 50001 Energy Management
Benefits of an effectively implemented EnMS can include:
Reduced operational and overhead costs → increased profitability
• • • • Reduced air emissions, such as GHG Increased efficiency of energy sources Increased assurance of legal, internal compliance Variables affecting energy use and consumption are identified
ISO 50001 is a foundational tool that any organization can use to manage energy. Components in place: • Baseline • Policy • Plan • Team/Leader
Superior Energy Performance
Facility-level conformance to ISO 50001 with validated energy performance improvement
ISO 50001
ISO 50001
DOE, 2011
16
ISO 50001 Key Elements
• • • • • • • • • • Energy policy Cross-divisional management team Energy review Baseline (s) Energy performance indicators (EnPIs) Energy objectives and targets Action plans Operating controls and procedures Measurement and verification Reporting of progress
17
Step 1 – Commitment Step 2 - Data Step One:
Secure Commitment from Top Management
• Set Energy Policy • Define Scope and Boundaries
Step Two:
Collect, Track, and Analyze Energy Data
• Current and past energy use, consumption • Estimate future energy use, consumption
18
Step 3 – Energy Use Step Three:
Identify Key Energy Uses • • • • • • Facilities Systems Equipment Processes Personnel Relevant Variables
19
Step 4 - Baseline
Step Four:
Establish a Baseline
• • • • Reference point for energy performance Outlines current energy performance Predicts future energy performance Provides benchmarking method
20
Step 5 - Opportunities Step 6 - Prioritize Step Five:
Identify Energy-Saving Opportunities
• • • New Sources Renewable Sources Alternative Sources
Step Six:
Prioritize Opportunities
• Return on Investment • Ease of Implementation
21
Implementation and Operation
• Competency, Training and Awareness • Communication • Documentation, Control of Documents
• Operational Control • Design • Procurement
22
Checking and Management Review
• Monitoring, Measurement and Analysis • Evaluation of Compliance • Internal Audit • Non-Conformance, Correction, Corrective and Preventive Action • Control of Records • Management Review
23
EnMS and Other Standards
ISO 9001:2008 •Design •Procurement ISO 14001:2004 • Legal, Other requirements • Significant Energy Use • Objectives, Targets, Action Plans • Evaluation of Compliance
24
• Capital asset planning • Production Process Planning • Carbon & GHG • Waste reduction • Supply chain marketability • New product/service opportunities • Employee engagement • Retail: market differentiation
Recent Case Studies & Results
25
Example Results – AU Optronics, Taiwan
• LCD TV’s – Taiwan, Province of China ISO 50001 implementation achieved 10 % energy conservation at the plant this year, save an estimated 55 million kWh of electricity and reduce carbon emissions by 35,000 tons. • The company now plans to adopt an ISO 50001based energy management system at all its manufacturing plants.
26
Example Results – Dahanu Power Station, India
The plant conducted a series of targeted investments since March 2010 which, aided by the organization’s new ISO 50001-based energy management system, are expected to yield annual savings of about INR 96.4 million ($1.9M USD) from raised energy efficiency and management.
27
Example Results – Schneider Electric US
ISO 50001 & SEP Program demonstrate exceptional savings at its flagship manufacturing plant in USA. Example: $27,000 USD savings annually from VSD installation, lighting, heat recovery. Plus a new 1MW solar field and additional savings from other projects yet to be announced estimated greater than 10%. Payback range avg. 18 months. 90% of worldwide facilities are ISO 140001 certified.
28
Example Results – Delta Electronics, China
With the implementation of the ISO 50001 energy management system in the Dongguan region, and production capacity at an even level from January to May of this year, we have already reduced power consumption by 10.51 million KWH as compared to the same period in 2010. This is equivalent to a reduction of 10.2 thousand tons of carbon emissions and a saving of CNY 8 million ($1.6M USD)
29
Example Results – Municipality of Bad Eisenkappel, Austria
During the first year, consumption of electrical energy decrease by nearly 25 % with the main savings achieved by updating the waste water plant and reducing energy consumption by 86, 000 kWh equivalent to just over $21,400 USD.
30
Example Results – Cook Composites & Polymers, US CCP’s Houston plant attained SEP Gold Certified Partner status and achieved a 14.9% improvement in energy efficiency over a two-year period. The energy efficiency measures taken by CCP resulted in 31,700 million British thermal units of energy saved and allowed the company to capture $250,000 in cost savings per year.
31
UL DQS Inc. ISO 50001 Tools
UL DQS offers: Practitioner’s Guide & Self Assessment Tool
Practitioner’s Guide
Scorecard Tool
32
[email protected] 800.285.4476 x3328 www.ul-dqsusa.com
