ISO 50001 Energy Management, SEP Executive Briefing - UL DQS Inc.

Energy Management

Driving Operational & Financial Performance

Don MacdonaldSustainability & Energy Program Director

[email protected]

http://www.linkedin.com/pub/don-macdonald-leed-ap-rabqsa/0/595/715/

Market Adoption Indicators2014 certifications

ISO 9001ROI benchmarks 9-13%

ISO 14001ROI Benchmarks 7-12%

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

• Integrated with ISO 9001, 14001, & SEP, CSR

RiskMgmtQuality

Environ & GHG Mgmt

Energy Mgmt

LEED

CSR

Multi-Nationals Adopting ISO 50001 - > 4000 to Date

• 3M• Coca-Cola• Alcoa• Allsteel - HON• Amcor PET• Bentley Prince Street• Cook Composites• Sikorsky• OLAM Spices• MedImmune• Cummins• Ingersoll Rand

ISO 50001• CNH / Fiat• Schneider• Siemens• ABB

• 3M• Coca-Cola• Alcoa• Allsteel - HON• Amcor PET• Bentley Prince Street• Cook Composites• Sikorsky• OLAM Spices• MedImmune• Cummins• Ingersoll Rand

ISO 50001• CNH / Fiat• Schneider• Siemens• ABB

• Didion Milling, Inc

• Dow Chemical

• Eaton

• General Dynamics

• Free scale Semi

• Haynes International

• Holcim

• Lockheed Martin

• Cooper Tire

• Republic Conduit

• Bridgestone Tire

• Didion Milling, Inc

• Dow Chemical

• Eaton

• General Dynamics

• Free scale Semi

• Haynes International

• Holcim

• Lockheed Martin

• Cooper Tire

• Republic Conduit

• Bridgestone Tire

• Kenworth Trucks

• Neenah Foundry

Company

• Nissan

• Owens Corning

• Schneider Electric

• Spirax Sarco

• Traco

• Volvo

• World Kitchen

• Harbec

• United States Mint

• Kenworth Trucks

• Neenah Foundry

Company

• Nissan

• Owens Corning

• Schneider Electric

• Spirax Sarco

• Traco

• Volvo

• World Kitchen

• Harbec

• United States Mint

Commercial Superior Energy Performance Pilots:

•Cleveland Clinic

•US GSA

•Grubb & Ellis Company

•Marriott International, Inc.

•MIT Campus’s

•Target Corporation

•Wal-mart Stores, Inc.

Benchmark EnMS Maturity

Updated 2011, 7% Energy

Energy efficiency Benchmarking Maturity

EDF, 2013

Financial Criteria Benchmarking Maturity

EDF, 2013

Re Deployment of Operating Cost Savings

EDF, 2013

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Source: UNIDO 2010

Source: UNIDO

Energy Investments & OperationsWhy Energy Audits Aren’t Enough

Source: DOE

Organizations That Measure ROI/IRR of CSR 2009 - 2011

• Proportion of clients reporting Program ROI / IRR increasing

• Internal resource constraints continue, functional silo’s

• Breadth of adoption increasing

Executive Leadership is critical to ‘Mind the Gap’Facility managers typical energy champions

Harnessing the Power of a Process

Business processes for competitive advantage:

• Six Sigma• Lean Manufacturing• Continuous

Improvement

• ISO 9001• ISO 14001• Plan-do-check-act

Formal energy management standards (ANSI, BSI):

0%

5%

10%

15%

20%

25%

30%

35%

40%

Energy Management

Standard

Continuous Improvement

ISO 9001 or 140001

Six Sigma Lean

JCI Study - 83 Organizations surveyed…

State of the Art – Inconsistent use of Management Processes

Result:

Lower ROI, Mixed Results0

5

10

15

20

25

30

35

40

0-2 3-4 5-6 7-8 9-10

Nu

mb

er

of O

rga

niz

atio

ns

Energy Management Score

JCI Study - 83 Organizations surveyed…

• Training for employees: 76%• Formal review of energy policy - CSR: 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%

Management Systems Strategy – Technical and Behavioral

Focus EnMS on plants, buildings and operations above target.

•Drive Process Improvement

•Drive ROI/IRR

•Drive Integrated CSR

•Linkage to GHG

Focus EnMS on plants, buildings and operations above target.

•Drive Process Improvement

•Drive ROI/IRR

•Drive Integrated CSR

•Linkage to GHG

Energy Management System Best Practices

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

Step 3 – Energy Use

Step Three: Identify Key Energy Uses

• Facilities

• Systems

• Equipment

• Processes

• Relevant Variables

• Personnel (including on-site Contractors)

Step 4 - Baseline

Step Four:Establish a Baseline

• Reference point for energy performance

• Outlines current energy performance

• Predicts future energy performance

• Provides benchmarking method

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

Implementation and Operation

• Competency, Training & Awareness

• Communication

• Documentation, Control of Documents

• Operational Control

• Design

• Procurement

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

EnMS and Other Standards

• Legal / Other requirements

• Significant Energy Use

• Objectives, Targets, Action Plans

• Evaluation of Compliance

• Design

• Procurement

• Management Responsibility

ISO 9001:2008 ISO 14001:2004

Common Elements with other ISO Systems:

Building a Best in Class Energy Management System

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Building a Best in Class Energy Management System

24

EnMS & SEP Best Practice MappingOrganizational level

Barriers Best Practices

EnMS & SEP Best Practice MappingCapital level

Barriers Best Practices

EnMS & SEP Best Practice MappingData level

Barriers Best Practices

EnMS & SEP Best Practice MappingCommunication/PR level

Barriers Best Practices

The Superior Energy Performance (SEP) Program

ISO 50001 /SEP Demonstration sites US

Source: DOE

DOE SEP Pilot Results

Source: DOE

Results – Energy Cost Savings

Source: DOE

Shareholder Perspectives EnMS – Accounting for Value

• Profit Margin– Procurement - energy hedging– Product design can embody energy

considerations – Supply chain costs - energy, raw

material & transportation– Extend QMS and EMS systems

whether certified or “Self Declared”

• Sales Growth– Life cycle energy reductions

embedded in product manufacturing– Competitive advantage, less energy

and related raw material processing

• Investment Working Capital– Reduced excess energy and

materials, waste prevention, recycling, raw material substitution

• Investment Fixed Capital– Energy process modifications often

lead to end-of-the-pipe pollution control facilities

• Tax Rate– Availability of grants, utility program

credits, insurance ratings

• Cost of Capital– Improve loan characteristics– Energy risk management attracts

shareholders which leads to lower cost of debt and equity

– Non-disclosure of energy efficiency, like environmental performance may have short-term impacts that lead to premium capital costs

Results – Costs of ImplementationIn most cases ROI < 2 Yrs.

Source: DOE

Case Studies, Results & Feedback from the Field

Staff Support

• A cross-functional energy management team is needed for effective implementation.

– e.g., plant energy leader, plant leader, quality leaders, engineers.

• All types of employees can contribute to energy management

– Line and production workers add separate sets of expertise

Feedback from Facilities

Other

• R&D should consider use of energy to produce a product.

• Achievements can bring recognition across the organization.

Costs

• Capital investment is not always required to achieve cost savings.

• Change of mindset: lower price per unit of energy is not the only way to reduce energy costs

Influence of Energy Management

• Managing energy has similar structure as managing cash, safety, health, environment and quality.

• Energy management becomes a way of doing business, instead of making improvements on project-by-project basis.

• Energy management becomes a shared responsibility across operations, maintenance, finance.

AU Optronics, Taiwan

St. Mary’s Cement

Save Energy Now – Best Practice AlternativeData Center Assessment Summary Verizon

Save Energy Now – Best practice AlternativeData Center Assessment Summary Lucas film

Briggs & Stratton – Best Practice Alternative

Dahanu Power Station, India

Delta Electronics

Schneider Global HQ

CertifiedISO14001HQE ExploitationNF EN16001ISO 50001: first certified building in the world!

÷4Final energy consumption vs. previous sites in the area

80 kwh/m²/ anFinal energy consumptionROI in 5 to 7 years

Schneider Electric Smyrna, TNISO 50001 Certified, SEP Pathway

Haynes International

Pfizer Ireland – ISO 50001

Reduced energy and resource intensity, decrease CO2 emissions.

Used ENERIT ISO 50001 IT Platform to facilitate certification.

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• SustainabilityCNH is part of Fiat Industrial

– fully integrating the environment and society with economic objectives. 2010 Fiat Sustainability Report.

.

• Certified Management Systems

Commitment to sustainability includes having our manufacturing activities performed in responsible facilities that are certified to meet environmental, quality, safety and now energy management system standards.

CNH / Fiat Certification – Building into CSRUL DQS Certified first plant

Volvo

• Absolute energy use and intensity - 38%, 2001 to 2010

• As part of U.S.-DOE’s Save Energy Now, accomplished 10-year goal of 25% improvement in energy intensity in 2010 (29.6%)

• Goals 2010 to 2012 reduce idling losses – or energy use outside of production – by 50 percent by 15% per unit produced against a 2008 baseline.

Energy Management within ISO 14001 Programs

Mass Transit Agency Leadership LA Metro, NY MTA

DOW

2800 Staff / 2300 global Auditors, 76 offices in 55 countries Over 20,000 customers, 100 countries

UL DQS –Integrity, Competence and Trust in Management Systems