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

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ISO 50001 is designed to help companies enhance their use of energy-consuming assets, evaluate and prioritize the implementation of energy-efficient technology, and promote efficiency throughout the …

ISO 50001 is designed to help companies enhance their use of energy-consuming assets, evaluate and prioritize the implementation of energy-efficient technology, and promote efficiency throughout the supply chain.

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  • Here is a well known illustration on the typical cycle of poor decision making (in the absence of continuous improvement processes) and the resulting costs over time.
    Firms of different sizes and complexities often focus continuous energy management efforts within selected divisions or processes all the way across similar operations over multiple geographies in benchmarking style efforts.
    We are seeing up take of multiple facilities (some cases 10-50 in scale) use such benchmarking to drive process improvement, costs and even product design issues depending on the industry.
    The key point, with continuous management processes these efforts simply return to the mean.
  • These are some examples of financial drivers we see firms asking for specific dollar / Euro assignments being made much, similar to financial reports style.
    We for example recently awarded a very large transportation agency an ISO 14001 certificate and they demonstrated a significant ROI on the investment, documenting direct and in-direct costs.
    We are now looking to support them in rolling these very energy improvement processes into the platform (no pun intended) to further drive improvements.
  • Don

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  • 1. Energy Management Driving Operational & Financial Performance Don Macdonald Sustainability & Energy Program Director Don.macdonald@us.dqs-ul.com http://www.linkedin.com/pub/don-macdonald-leed-ap-r
  • 2. Market Adoption Indicators 2014 certifications ISO 9001 ROI benchmarks 9-13% ISO 14001 ROI Benchmarks 7-12% CSR 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 Environ & GHG Mgmt Energy Mgmt LEED Quality Risk Mgmt
  • 3. Multi-Nationals Adopting ISO 50001 - > 4000 to Date •• 3M Commercial Superior 3M Energy Performance Pilots: •• Coca-Cola Coca-Cola •• Alcoa Alcoa •Cleveland Clinic •• Allsteel --HON Allsteel HON •• Amcor PET Amcor PET •US GSA •• Bentley Prince Street Bentley Prince Street •• Cook Composites •Grubb & Ellis Company Cook Composites •• Sikorsky Sikorsky •Marriott International, Inc. •• OLAM Spices OLAM Spices •• MedImmune MedImmune •MIT Campus’s •• Cummins Cummins •• Ingersoll Rand Ingersoll Rand •Target Corporation •Wal-mart Stores, Inc. ISO 50001 ISO 50001 •• CNH / /Fiat CNH Fiat •• Schneider Schneider •• Siemens Siemens •• ABB ABB •• Didion Milling, Inc Didion Milling, Inc •• Kenworth Trucks Kenworth Trucks •• Dow Chemical Dow Chemical •• Eaton Eaton •• General Dynamics General Dynamics •• Neenah Foundry Neenah Foundry Company Company •• Free scale Semi Free scale Semi •• Haynes International Haynes International •• Owens Corning Owens Corning •• Holcim Holcim •• Lockheed Martin Lockheed Martin •• Cooper Tire Cooper Tire •• Republic Conduit Republic Conduit •• Bridgestone Tire Bridgestone Tire •• Nissan Nissan •• Schneider Electric Schneider Electric •• Spirax Sarco Spirax Sarco •• Traco Traco •• Volvo Volvo •• World Kitchen World Kitchen •• Harbec Harbec •• United States Mint United States Mint
  • 4. Benchmark EnMS Maturity Updated 2011, 7% Energy
  • 5. Energy efficiency Benchmarking Maturity EDF, 2013
  • 6. Financial Criteria Benchmarking Maturity EDF, 2013
  • 7. Re Deployment of Operating Cost Savings EDF, 2013
  • 8. Energy Investments & Operations Why Energy Audits Aren’t Enough Source: UNIDO 2010 Source: UNIDO 8
  • 9. Source: DOE
  • 10. 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
  • 11. Executive Leadership is critical to ‘Mind the Gap’ Facility managers typical energy champions
  • 12. Harnessing the Power of a Process Business processes for competitive advantage: • Six Sigma • Lean Manufacturing • Continuous Improvement 40% • ISO 9001 • ISO 14001 • Plan-do-check-act Formal energy management standards (ANSI, BSI): 35% 30% 25% 20% 15% 10% 5% 0% Energy Management Standard Continuous Improvement ISO 9001 or 140001 Six Sigma Lean JCI Study - 83 Organizations surveyed…
  • 13. State of the Art – Inconsistent use of Management Processes • Training for employees: 76% • • • • • • • • • 40 35 30 25 20 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% s t z i n a g O f o r e b m u N 15 10 5 0 0-2 3-4 5-6 7-8 9-10 Energy Management Score JCI Study - 83 Organizations surveyed… Result: Lower ROI, Mixed Results
  • 14. Management Systems Strategy – Technical and Behavioral Focus EnMS on plants, Focus EnMS on plants, buildings and operations buildings and operations above target. above target. ••DriveProcess Improvement Drive Process Improvement ••DriveROI/IRR Drive ROI/IRR ••DriveIntegrated CSR Drive Integrated CSR ••Linkageto GHG Linkage to GHG
  • 15. Energy Management System Best Practices
  • 16. 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
  • 17. Step 3 – Energy Use Step Three: Identify Key Energy Uses • Facilities • Systems • Equipment • Processes • Relevant Variables • Personnel (including on-site Contractors)
  • 18. Step 4 - Baseline Step Four: Establish a Baseline • Reference point for energy performance • Outlines current energy performance • Predicts future energy performance • Provides benchmarking method
  • 19. 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
  • 20. Implementation and Operation • • • • • • Competency, Training & Awareness Communication Documentation, Control of Documents Operational Control Design Procurement
  • 21. Checking and Management Review  Monitoring, Measurement and Analysis  Non-Conformance, Correction, Corrective and Preventive Action  Evaluation of Compliance  Control of Records  Internal Audit  Management Review
  • 22. EnMS and Other Standards Common Elements with other ISO Systems: ISO 9001:2008 ISO 14001:2004 • Design • Legal / Other requirements • Procurement • Significant Energy Use • Management Responsibility • Objectives, Targets, Action Plans • Evaluation of Compliance
  • 23. Building a Best in Class Energy Management System 23
  • 24. Building a Best in Class Energy Management System 24
  • 25. EnMS & SEP Best Practice Mapping Organizational level Barriers Best Practices
  • 26. EnMS & SEP Best Practice Mapping Capital level Barriers Best Practices
  • 27. EnMS & SEP Best Practice Mapping Data level Barriers Best Practices
  • 28. EnMS & SEP Best Practice Mapping Communication/PR level Barriers Best Practices
  • 29. The Superior Energy Performance (SEP) Program
  • 30. ISO 50001 /SEP Demonstration sites US
  • 31. Source: DOE
  • 32. DOE SEP Pilot Results Source: DOE
  • 33. Results – Energy Cost Savings Source: DOE
  • 34. 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” • 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 • 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 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
  • 35. Results – Costs of Implementation In most cases ROI < 2 Yrs. Source: DOE
  • 36. Case Studies, Results & Feedback from the Field
  • 37. Feedback from Facilities 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 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 projectby-project basis. • Energy management becomes a shared responsibility across operations, maintenance, finance. 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 Other • R&D should consider use of energy to produce a product. • Achievements can bring recognition across the organization.
  • 38. AU Optronics, Taiwan
  • 39. St. Mary’s Cement
  • 40. Save Energy Now – Best Practice Alternative Data Center Assessment Summary Verizon
  • 41. Save Energy Now – Best practice Alternative Data Center Assessment Summary Lucas film
  • 42. Briggs & Stratton – Best Practice Alternative
  • 43. Dahanu Power Station, India
  • 44. Delta Electronics
  • 45. Schneider Global HQ ÷4 Final energy consumption vs. previous sites in the area Certified ISO14001 HQE Exploitation NF EN16001 ISO 50001: first certified building in the world! 80 kwh/m²/ an Final energy consumption ROI in 5 to 7 years
  • 46. Schneider Electric Smyrna, TN ISO 50001 Certified, SEP Pathway
  • 47. Haynes International
  • 48. Pfizer Ireland – ISO 50001 Reduced energy and resource intensity, decrease CO2 emissions. Used ENERIT ISO 50001 IT Platform to facilitate certification.
  • 49. CNH / Fiat Certification – Building into CSR UL DQS Certified first plant . • Sustainability CNH is part of Fiat Industrial – fully integrating the environment and society with economic objectives. 2010 Fiat Sustainability Report. 49 • 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.
  • 50. 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.
  • 51. Energy Management within ISO 14001 Programs Mass Transit Agency Leadership LA Metro, NY MTA
  • 52. DOW
  • 53. UL DQS – Integrity, Competence and Trust in Management Systems   2800 Staff / 2300 global Auditors, 76 offices in 55 countries Over 20,000 customers, 100 countries