Utility Week - authoritative, impartial and essential reading for senior people within utilities, regulators and government
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28 | 28TH OCTOBER - 3RD NOVEMBER 2016 | UTILITY WEEK Customers Market view T he advantages for a utility in reducing its energy usage are easy to under- stand: lower energy consumption means lower bills and lower emissions – a simple win for any company. Fewer people understand why an energy supplier would be keen to help its customers cut their consumption. With the market changing rapidly, energy suppliers must offer innovative services (for example, energy management training) that boost customer retention. Happily, this diver- sification represents a clear win-win for sup- pliers and customers. The savings that can be made through good energy management are substantial. With the market in flux as more intermit- tent generation joins the grid, and a growing number of thermal plants are taken offline, policymakers are keen to reward flexible demand. The penalties for non-compliance with policies such as the Carbon Reduction Commitment are severe. As a result, it is more important than ever for organisations to have a dedicated energy lead. Those that can hire or train a compe- tent energy manager will see an immediate impact; there are few roles, aer all, that can help you increase your operating profit without affecting manpower or processes. An energy manager who works with a build- ing management system (BMS) to reduce the building's out-of-hours baseload by 70 per cent, for example, is generating savings that directly increase the bottom line. Energy managers come from many backgrounds including, but not limited to, mechanical and electrical engineering; risk, facilities or environmental management; data and business analysis; and administration. Few, if any, started their careers as energy managers, while many inherited or designed their databases and processes from scratch. A good energy manager will not just be providing a reduction in overall energy costs through a cheaper tariff or by reminding staff to turn off their computers. They will be looking at wider utility costs and legislation across energy, water, waste and transport to ensure compliance, setting ambitious tar- gets, creating and implementing strategy and projects to achieve them. To do so, energy managers must under- stand building management: not just BMS, but heating, ventilation and air conditioning (HVAC); water consumption; waste manage- ment and disposal; lighting; data analysis; invoice validation and payment. No matter how sophisticated manage- ment systems get, informed human decisions will be needed for everything from handling demand-side response (DSR) to BMS. With regard to supply interruptions and DSR, it takes human intervention to decide on pol- icy, manage contracts and handle transmis- sion use of system, distributed use of system costs and all the rest. Setting up a BMS and making sure it is optimised needs a human touch too. This can mean setting the BMS policy or standard for the system you buy and install. If sev- eral buildings are of different age, for exam- ple, they will require tackling in different ways, with human decisions needed on the baseload the management systems should work towards and how the buildings can be best equipped to hit those targets. Some customers are cynical that utili- ties genuinely want to help customers drive down their costs. The fact is that all custom- ers want to reduce their energy bills: utili- ties understand that if one supplier does not help, another will. Moreover, utilities can increasingly make better margins on saving customers money than selling energy. For that reason, many are increasingly offering energy management qualifications and providing services like Npower's Energy HQ: a service hub from which we can assist with energy opportunities. This can also include procurement of contracts that allow customers to buy energy directly from the market. Most utilities will buy one on your behalf within an agreed strategy and budget (something an energy manager can create). Walking the walk is important: large diverse energy companies can be an example of what can be done to reduce energy usage, cost, carbon emissions and waste going to landfill. At Npower we have saved over £6.46 million on our energy bills; reducing energy usage by over 52 per cent to 28.9GWh a year, reducing energy spend by over 44 per cent, reducing carbon emissions by 53 per cent and increasing recycling from 40 per cent to over 82 per cent. When we sit down with energy manag- ers (too oen still someone simply seconded for the duration of the meeting) they are fre- quently astonished at the savings that can be made. Speaking with someone who has a holistic understanding of the challenges and opportunities in energy management is always a pleasure, as is describing the scope of opportunity for fiscal and emissions sav- ings. More companies should look at how they can train someone to best fit this role – for the bottom line and for the planet. Dave Horton, energy specialist, Npower Business Solutions The case for energy managers Utilities can cement their relationships with business customers by helping them understand the importance of energy management – and help them train energy managers, says Dave Horton. ENERGY EFFICIENCY R&D EXPENDITURE AS A PERCENTAGE OF GDP Source: World Energy Council 0.18% 0.16% 0.14% 0.12% 0.10% 0.08% 0.06% 0.04% 0.02% 0.0% 2006 2007 2008 2009 2010 2011 2012 2013 Sweden Switzerland UK 29 country average US Germany Canada France Finland