A Enlightened Approach to Budgeting and Goal Setting

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- By:

Courtesy of Abraxas Energy Consulting

Abstract

Every year energy managers need to report how much energy they saved and whether or not they met their energy savings targets. Most energy managers present reports comparing their current year’s usage to energy usage from a previous year. Savings targets are typically a percentage of that previous year’s usage. Setting targets and comparing in this manner usually does not generate an accurate estimate of energy actually saved. Inconsistencies arise from year-to-year fluctuations in weather, occupancy, production or other factors, which can interfere with savings results. Instead, an energy manager’s performance should be determined by comparing current year usage to a normalized baseline, which represents how much energy the building would have used given current year weather conditions, production, occupancy, and base year usage patterns. Energy savings targets should be set based upon this dynamic baseline. Using dynamic targeting, variations in weather conditions, occupancy, production or other factors will not hinder the accurate measure of how much the energy manager saved, and whether energy savings goals were indeed met. This paper explains, with an example, the differences between using a static and dynamic (weather normalized) targeting to demonstrate energy savings.

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