Prospering with the New ISO Energy Standards

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According to the USEPA, energy use in commercial and industrial buildings costs U.S. companies about $200 billion per year. And for many businesses, energy costs (with unit prices rising every year) are among their largest expenses. Therefore, the direct financial benefits of reducing energy use should drive all companies – even non-“smoke stack” facilities – to establish a program. So what is holding up many U.S. organizations from devoting themselves to reduce energy? For many, it is the lack of standards. What constitutes a proper, effective effort to reduce energy use? How can my company achieve reductions and yet not overspend upfront? What are my competitors doing?

Earlier this year, the ISO organization published final energy management certification standards: ISO 50001 (http://www.iso.org/iso/energy_management_system_standard). This follows other ISO standards (ISO 9001, 140001), and applies to energy management.

ISO 50001 takes a holistic approach to energy management and not mearly to “check off” the boxes or on one-time achievements. ISO 50001 requires the facility to establish an energy baseline and from this develop realistic energy goals and strategies (i.e., improve energy efficiency and conservation). Once energy strategies are implemented, ISO 50001 requires monitoring and recordkeeping to ensure that selected technologies and strategies continue to work toward intended energy goals and that management oversight of energy is part of the corporate or facility “culture”.

ISO 50001 focuses on long-term improvement in energy management, not just meeting some short-term goals and stopping there. One of the criticisms of the LEED green building program is that it is perceived to focus on meeting a goal (LEED certification at some level), implementing strategies to meet the goal, and potentially stopping there and not necessarily ensuring that the strategies work optimally long term. ISO’s continuous improvement emphasis ensures the best return on investment for the facility, as well as long-term reduction in energy usage, expenses, and greenhouse gas emissions.

One unique feature of ISO 50001 is the requirement for 3rd party review of energy management systems. This is intended to raise the pressure on those that pursue ISO 50001 certification to do it properly and to do so to prosper in the long terms.

Energy savings, as discussed in earlier Environmental News for YouTM, is the most successful strategy for those looking to be more sustainable and achieve economic gains in the quickest timeframe given its measureable metrics (reduced kwh electricity or gallons of oil or cf of natural gas) and the fact that unit energy prices (cost per kwh electricity or per gallon of oil) are at record levels and in the long-term will likely continue to grow as there are only finite sources of fossil fuels.

Those companies looking to garner financial gains in 2012 should look into energy savings. Planned, site-specific energy audits followed by implementation of reasonable findings are virtually guaranteed to pay for themselves and more. According to the US Dept of Energy, 40-50% reductions in energy use (and concurrent reduction in energy expenses) within 5 years of beginning the process were shown to be typical and fairly consistent across type (office building, retail, etc.) and U.S. region (arid vs. wet, cold vs. warm). Remember the power of energy savings from a business point of view. Saving energy expenditures is money “in the bank”, directly raising profits. The alternative way to make a profit, increasing sales or revenues, takes a large investment (sales staff, ads, etc.), is not guaranteed, and can change from year to year. Energy savings continue with no additional changes and grow (as unit costs grow) in the future.

Now that there are new respected energy standards from ISO (as so many companies have met ISO 9001, ISO 14001 and other ISO standards), any hesitation based on not being sure how to implement an energy program should disappear.

What is the future for ISO 50001? As a voluntary standard, will it have much impact? It is possible that major companies that already collect information or set standards for their supply chain, such as Walmart and IBM, will request their suppliers to address and potentially certify under ISO 50001 in order to continue to do business. When Walmart began requesting greenhouse gas life cycle information, suppliers rigorously began to determine their carbon footprint. A similar request from Walmart on the energy side will likely cause a similar reaction. Besides pleasing customers and investors, significant cost savings should merit a systematic upgrade in the energy usage area. ISO 50001 now provides a valid roadmap and standard to validate pursuit by all types of companies and gives security that an internationally-accepted standard is being met.

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This Environmental News for You is meant to provide background on the new ISO energy standards. CCES experts can assist you in implementing these standards and showing how you can improve efficiency and financially benefit from this and other sustainability programs.

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