How to Ensure Your Energy Efficiency Investment Pays Back

Before Investing in Energy Efficiency

If you are ready to invest in energy efficiency upgrades for your business, you should be aware of the questions you want to ask any companies offering products or services that they say will improve your energy efficiency. Here are some questions and points to consider before choosing a company offering energy efficiency products or services.

You Want Proof

Many energy efficiency and energy management companies in Australia promise that their products and services will save you money by reducing the electricity you need to use. You should respond to that promise with a question, “How will you prove the savings?”.

If the answer is that your bills will go down, ask them if they are going to do year on year bill comparisons. If so, how will they account for differences in temperature? You may see that your electricity goes down in January compared with the previous year, but maybe last year was hotter than this year. So, is it the energy efficiency investment that is saving you money or the fact that your air conditioning system doesn’t have to work as hard as it did last year? The company should be able to show that your site is using less electricity because it is running more efficiently than before.

The Importance of a Baseline

The only way to know if your energy efficiency and energy management investments are providing the savings promised is to have an established baseline to compare future electricity consumption data against. The baseline needs to show your site’s existing consumption patterns and levels.

If you set a goal of reducing your company’s electricity consumption by 20% in the next five years, but you don’t measure your current consumption, you have no way of measuring your progress in meeting your goal. Establishing a baseline lets you see how much you are reducing your electricity consumption and how much you still need to improve. A baseline also shows how much electricity your saving with each energy efficiency investment. When you can compare savings achieved versus dollars spent, you are able to see your true return on investment. With better information, you can make better decisions about future energy efficiency investments. And if you don’t see any energy savings, you can go back to the product or service provider and discuss the lack of savings and seek your money back or improved performance.

Baseline consumption data is also important for government grant programs for energy efficiency investments. For example, New South Wales offers businesses the opportunity to use the meter baseline approach to earn energy savings certificates through the Energy Savings Scheme for their energy efficiency investments.

How SEDAC Energy Management Can Help

Whether you use our energy efficiency services, or whether you just want to track another service provider’s performance in saving you energy, SEDAC Energy Management can help. SEDAC EM helps you establish a baseline by importing your National Meter Identifier (NMI) data into the SEDAC EMS Portal. The SEDAC EMS Portal then compares your consumption data against historical weather data, and learns how your site behaves with regards to energy consumption. After your energy efficiency installation, the portal can compare each new day’s energy consumption data against historical data for similar days and reports whether you are saving energy with your energy efficiency investment. You can tell if you are saving electricity because your site is more efficient, or if you are using the same amount of electricity as you would have before the investment.

What happens if I don’t set a baseline?

You risk losing your money on an energy efficiency program that doesn’t work, and you can’t hold the manufacturer or service provider accountable.

You have no way of knowing if you are meeting any established energy savings goals.

What if I use sub-meter data only to set a baseline?

If you don’t look at your whole site, you may find that an energy efficiency project on your refrigeration system ended up costing you money by increasing your HVAC energy consumption. Thus, you lose money on your energy efficiency investment. While sub-metering offers valuable insights into when and where your site is consuming electricity, you need multiple sub-meters and a meter on your entire site to truly understand your site’s performance and ensure savings.

A Baseline That You Can See

The SEDAC EMS Online Portal (below) shows the site’s daily consumption (in blue) after the solu- tion has been installed. Shown in red is the site’s expected consumption given the weather and historical consumption patterns before the SEDAC EM installation took place. The difference be- tween the predicted (red) and actual (blue) is how much the site is saving each day thanks to the SEDAC Energy Management Solution.
The SEDAC EMS Online Portal shows the site’s daily consumption (in blue) after the solution has been installed. Shown in red is the site’s expected consumption given the weather and historical consumption patterns before the SEDAC EM installation took place. The difference between the predicted (red) and actual (blue) is how much the site is saving each day thanks to the SEDAC Energy Management Solution. SEDAC EM offers the portal to customers of other energy efficiency providers if they want a third party to track the energy efficiency achieved by their investment. Please see our metering and monitoring pages for more information!

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