5.2 Energy efficiency and renewable energy
7 min read•july 30, 2024
Energy efficiency and renewable energy are crucial components of environmental performance. Organizations can reduce their and operational costs by implementing energy-saving measures and transitioning to clean energy sources.
Analyzing energy consumption, conducting audits, and exploring efficiency opportunities are key steps. Renewable technologies like solar, wind, and geothermal offer sustainable alternatives. Implementing energy management systems and tracking progress through metrics help organizations achieve their sustainability goals.
Energy Consumption Analysis
Energy Audits
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- are a systematic process used to identify and quantify energy use and loss within an organization's facilities, equipment, and processes
- The goal is to identify opportunities for energy efficiency improvements
- Key components of an energy audit include collecting and analyzing energy consumption data, conducting on-site inspections and measurements, identifying energy efficiency opportunities, and providing recommendations for improvements along with cost/benefit analysis
- Energy audits often involve the use of specialized tools and equipment to measure energy consumption (power meters, thermographic cameras) and analyze building performance (blower door tests, duct leakage tests)
Energy Efficiency Opportunities
- Common areas for energy efficiency improvements in organizations include lighting systems, HVAC systems, building envelope, office equipment and appliances, industrial processes and equipment, and employee behavior and practices
- Lighting efficiency measures may include upgrading to LED bulbs, installing occupancy sensors, and optimizing daylighting (skylights, light shelves)
- HVAC efficiency can be improved through regular maintenance, programmable thermostats, zoning, and upgrading to high-efficiency equipment (heat pumps, variable speed drives)
- Building envelope improvements focus on reducing heat transfer through insulation, air sealing, and energy-efficient windows and doors
- Office equipment and appliance efficiency can be addressed through Energy Star certified products, power management settings, and employee education on energy-saving practices (turning off equipment when not in use)
- Industrial process efficiency improvements may involve upgrading motors, pumps, and compressed air systems, optimizing process controls, and implementing waste heat recovery
Benchmarking and Investment
- Benchmarking an organization's energy performance against industry standards or similar organizations can help identify areas for improvement and set realistic efficiency targets
- Common benchmarking tools include the Energy Star Portfolio Manager, which compares a building's energy performance to similar buildings nationwide
- Implementing energy efficiency measures often requires upfront investments, but can lead to significant long-term cost savings through reduced energy consumption and operating expenses
- Conducting a thorough cost/benefit analysis is essential for prioritizing energy efficiency investments and demonstrating the financial viability of projects
- Many utilities and government agencies offer incentives and rebates for energy efficiency projects, which can help offset initial costs and improve return on investment
Renewable Energy Technologies
Solar Energy
- Solar photovoltaic (PV) systems convert sunlight directly into electricity using solar panels made of semiconductor materials
- PV systems can be used for on-site electricity generation in residential (rooftop arrays), commercial (carports, building-integrated PV), and utility-scale applications (solar farms)
- Solar thermal systems use solar collectors to capture heat from the sun, which can be used for space heating, water heating, or generating electricity through concentrated solar power (CSP) plants
- CSP technologies include parabolic troughs, power towers, and dish engines that focus sunlight to produce high-temperature heat for steam turbine electricity generation
Wind and Hydropower
- Wind turbines convert the kinetic energy of moving air into electricity
- can be harnessed through both onshore and offshore wind farms, with varying turbine sizes and designs based on location and wind resource availability
- Advances in wind turbine technology, such as larger rotor diameters and taller towers, have increased the efficiency and cost-effectiveness of wind power
- Hydroelectric power generates electricity by capturing the energy of falling or flowing water through turbines in dams (conventional hydropower) or run-of-river systems (diversion hydropower)
- Pumped storage hydroelectricity acts as a form of energy storage by pumping water to a higher reservoir during times of low electricity demand and releasing it through turbines during peak demand periods
Geothermal and Bioenergy
- Geothermal energy utilizes heat from the earth's core for direct heating applications or electricity generation
- Geothermal power plants use steam or hot water from underground reservoirs to drive turbines, with different designs (dry steam, flash steam, binary cycle) based on resource characteristics
- Direct use geothermal applications include space heating, greenhouses, aquaculture, and industrial processes
- Bioenergy refers to energy derived from organic matter (biomass), including wood, crops, and waste materials
- Biomass can be burned directly for heat (wood stoves, industrial boilers) or converted into biofuels like ethanol (from corn, sugarcane) and biodiesel (from vegetable oils, animal fats) for transportation
- Biogas, produced from the anaerobic digestion of organic waste (manure, food waste, wastewater), can be used for electricity generation or upgraded to biomethane for pipeline injection
Energy Management Systems
EMS Development and Implementation
- An is a structured framework for monitoring, controlling, and optimizing an organization's energy consumption and performance
- Key steps in developing an EMS include securing top management commitment, establishing an energy policy, conducting an initial energy review, setting energy performance targets, creating an action plan, implementing energy-saving measures, and continuously monitoring and improving performance
- is an international standard that provides guidelines for establishing, implementing, maintaining, and improving an EMS
- Adhering to ISO 50001 can help organizations systematically manage energy and demonstrate their commitment to energy efficiency
- ISO 50001 follows a Plan-Do-Check-Act (PDCA) cycle for continuous improvement, similar to other management system standards (ISO 9001 for quality, ISO 14001 for environmental management)
Energy Baselines and Employee Engagement
- Establishing an energy baseline is crucial for measuring and verifying energy savings achieved through the EMS
- The baseline should be normalized for factors like weather (heating and cooling degree days), production levels, and facility changes to ensure fair comparison over time
- are used to track progress against the baseline, such as energy consumption per unit of production or per square foot of building space
- Engaging employees at all levels of the organization is critical for successful EMS implementation
- This includes providing energy awareness training, encouraging energy-saving behaviors (turning off lights and equipment, proper thermostat settings), and involving employees in identifying and implementing efficiency improvements
- Employee engagement strategies may include energy champions programs, suggestion schemes, and recognition and rewards for energy-saving efforts
Audits and Continuous Improvement
- Regularly conducting internal audits and management reviews helps ensure the EMS is functioning effectively and drives continuous improvement in energy performance
- Internal audits assess conformance to the EMS requirements and identify opportunities for improvement, while management reviews evaluate the suitability, adequacy, and effectiveness of the EMS
- The results of audits and reviews inform corrective actions, preventive actions, and updates to the energy policy, objectives, and targets
- Monitoring and analyzing energy performance data on an ongoing basis is essential for identifying trends, anomalies, and areas for further improvement
- Advances in energy metering, sub-metering, and data analytics tools (energy management information systems, building automation systems) enable more granular and real-time energy performance tracking and optimization
Renewable Energy Transition
Metrics and Reporting
- Renewable energy transition reports communicate an organization's efforts, achievements, and challenges in shifting from fossil fuels to renewable energy sources
- Key metrics to include in a renewable energy transition report: percentage of energy consumption from renewable sources, renewable energy generation capacity, , and progress towards renewable energy targets
- Renewable energy consumption can be reported as a percentage of total energy use, broken down by source (solar, wind, hydro, geothermal, bioenergy)
- Renewable energy generation capacity should be reported in terms of installed capacity (MW of solar PV, wind turbines) and actual energy generated (MWh of solar electricity, wind electricity produced)
- Greenhouse gas emissions reductions from renewable energy adoption can be quantified using emission factors for displaced fossil fuel energy sources (coal, natural gas) and reported in terms of metric tons of carbon dioxide equivalent (CO2e) avoided
Projects and Challenges
- The report should highlight significant renewable energy projects or initiatives undertaken by the organization, such as on-site solar installations, power purchase agreements, or investments in off-site renewable energy projects
- Case studies or project profiles can provide details on the scale, technologies used, energy generation and emissions reduction potential, and financial aspects of notable renewable energy projects
- Discussing challenges and barriers encountered in the renewable energy transition, such as technical limitations, financial constraints, or regulatory hurdles, provides context and transparency
- Common challenges include intermittency of renewable energy sources, grid integration and storage, high upfront capital costs, and complex permitting and approval processes
- Sharing lessons learned and strategies for overcoming challenges can help other organizations navigate their own renewable energy transitions
Future Plans and Alignment
- Outlining future plans and targets for increasing renewable energy adoption demonstrates the organization's ongoing commitment to the energy transition
- This may include short-term goals (increasing renewable energy procurement by 20% in the next year), medium-term targets (achieving 50% renewable energy by 2030), and long-term vision (100% renewable energy by 2050)
- Discussing strategies for achieving future renewable energy targets, such as on-site generation, virtual power purchase agreements, renewable energy certificates, or green tariffs, provides a roadmap for the organization's transition
- Aligning the organization's renewable energy progress with broader sustainability goals, such as climate change mitigation or carbon neutrality, helps contextualize the importance of the energy transition
- Linking renewable energy achievements to global sustainability frameworks, such as the United Nations Sustainable Development Goals (particularly SDG 7 on affordable and clean energy and SDG 13 on climate action), demonstrates the organization's contribution to larger societal and environmental objectives
Key Terms to Review (19)
Building retrofits: Building retrofits refer to the process of upgrading existing structures to improve their energy efficiency, sustainability, and overall performance. This includes a range of modifications such as improving insulation, installing energy-efficient windows, upgrading heating and cooling systems, and incorporating renewable energy technologies. These upgrades not only help reduce energy consumption but also contribute to lower greenhouse gas emissions and enhanced occupant comfort.
Carbon footprint: A carbon footprint measures the total greenhouse gas emissions caused directly and indirectly by an individual, organization, event, or product, typically expressed in equivalent tons of carbon dioxide (CO2e). This concept connects to various aspects of sustainability, including energy consumption, resource management, and corporate social responsibility, emphasizing the need for transparent reporting and effective strategies to mitigate climate change impacts.
Corporate Social Responsibility (CSR): Corporate Social Responsibility (CSR) is a business model where companies integrate social and environmental concerns into their operations and interactions with stakeholders. This approach emphasizes ethical practices, transparency, and accountability, aiming to create positive impacts on society while ensuring long-term business success. CSR connects to various dimensions of sustainability, including energy efficiency, the adoption of standards, and global goals, while also addressing the importance of credibility in reporting.
Energy audits: Energy audits are systematic evaluations of energy use within a building or facility, identifying opportunities for improving energy efficiency and reducing costs. These audits assess the performance of various systems, such as heating, cooling, lighting, and insulation, while also providing recommendations for using renewable energy sources. By understanding energy consumption patterns, organizations can make informed decisions that enhance sustainability and lower their carbon footprint.
Energy intensity: Energy intensity refers to the amount of energy consumed per unit of economic output, typically expressed as energy used per GDP or per product produced. This measure helps assess how efficiently an economy uses energy resources in relation to its economic performance. A lower energy intensity indicates a more efficient use of energy, which is crucial for enhancing sustainability and reducing carbon emissions.
Energy Management System (EMS): An Energy Management System (EMS) is a set of processes and technologies that organizations use to manage and optimize their energy usage. It involves measuring, monitoring, and analyzing energy consumption to improve energy efficiency and promote the use of renewable energy sources. By systematically managing energy, organizations can reduce costs, enhance sustainability, and minimize their environmental impact.
Energy Performance Indicators (EnPIs): Energy Performance Indicators (EnPIs) are measurable values that help organizations assess their energy efficiency and effectiveness in utilizing renewable energy sources. By monitoring EnPIs, companies can identify areas for improvement, track energy consumption trends, and evaluate the success of energy management strategies. These indicators are essential for understanding how well an organization is performing in terms of energy use and sustainability.
Feed-in Tariffs: Feed-in tariffs are policy mechanisms designed to encourage the development and use of renewable energy sources by guaranteeing fixed payments to energy producers for the electricity they generate and feed into the grid. These tariffs provide long-term contracts, typically 15 to 20 years, which create financial certainty for investors and promote the deployment of clean energy technologies, thus contributing to both energy efficiency and the transition towards renewable energy systems.
Global Reporting Initiative (GRI): The Global Reporting Initiative (GRI) is an international independent organization that provides a comprehensive framework for sustainability reporting, enabling organizations to measure and communicate their economic, environmental, and social impacts. GRI standards help companies report on their sustainability performance, ensuring transparency and accountability while promoting sustainable development practices across various sectors.
Greenhouse gas emissions reductions: Greenhouse gas emissions reductions refer to the strategies and actions taken to decrease the release of greenhouse gases into the atmosphere, which contribute to climate change. These reductions are essential for combating global warming and are often achieved through improvements in energy efficiency and the transition to renewable energy sources. By lowering greenhouse gas emissions, organizations can significantly mitigate their environmental impact while often realizing cost savings in energy consumption.
ISO 50001: ISO 50001 is an international standard that provides organizations with a structured framework to manage and improve their energy performance. It focuses on energy efficiency, sustainability, and the reduction of greenhouse gas emissions, making it an essential tool for organizations committed to energy management and renewable energy usage.
Life Cycle Assessment (LCA): Life Cycle Assessment (LCA) is a systematic method for evaluating the environmental impacts of a product or service throughout its entire life cycle, from raw material extraction through production, use, and disposal. This approach helps organizations identify opportunities for improving sustainability by providing a comprehensive view of resource consumption and emissions at each stage of a product’s life. By understanding these impacts, companies can make informed decisions that enhance energy efficiency, promote renewable energy use, and accurately measure and value their overall environmental impact.
Renewable Portfolio Standards: Renewable Portfolio Standards (RPS) are regulations that require utility companies to obtain a certain percentage of their energy from renewable sources. These standards are designed to encourage the use of renewable energy technologies, such as solar, wind, and hydroelectric power, and to reduce dependence on fossil fuels. By mandating specific targets for renewable energy generation, RPS aims to promote cleaner energy production and drive investments in sustainable energy solutions.
Solar energy: Solar energy is the radiant light and heat harnessed from the sun, primarily through the use of solar panels and other technologies that convert sunlight into usable electricity or thermal energy. This renewable energy source plays a crucial role in reducing greenhouse gas emissions and promoting energy efficiency, making it essential for sustainable development and addressing climate change.
Subsidies: Subsidies are financial assistance provided by governments to support specific sectors, industries, or activities, aiming to promote economic and social benefits. They play a significant role in making energy efficiency and renewable energy projects more viable by lowering costs and encouraging investment in sustainable technologies. By reducing the financial burden, subsidies help stimulate market growth and foster innovation within the energy sector.
Sustainability Accounting Standards Board (SASB): The Sustainability Accounting Standards Board (SASB) is an independent nonprofit organization that develops and disseminates sustainability accounting standards to help public corporations disclose material, decision-useful information to investors. SASB's standards are designed to improve the transparency and comparability of sustainability performance across industries, which is crucial for effective risk management and compliance.
Tax credits: Tax credits are incentives provided by the government that reduce the amount of tax owed by individuals or businesses, encouraging specific behaviors or investments. They are often used to promote energy efficiency and renewable energy projects, effectively lowering the financial burden on those who invest in sustainable practices. These credits can come in various forms, such as refundable or non-refundable credits, and play a vital role in driving the transition towards a greener economy.
United Nations Framework Convention on Climate Change (UNFCCC): The UNFCCC is an international treaty aimed at addressing climate change and its impacts by stabilizing greenhouse gas concentrations in the atmosphere. It was established in 1992 and serves as a framework for global cooperation to combat climate change, promoting sustainable development through energy efficiency and renewable energy initiatives among signatory countries.
Wind power: Wind power is the process of converting wind energy into electricity using wind turbines. It is a renewable energy source that contributes to reducing greenhouse gas emissions and offers an alternative to fossil fuels, aligning with efforts to promote sustainability and energy efficiency.