Reducing Energy Costs (and saving the planet)

Reducing energy costs (and saving the planet)

Improving productivity means addressing all costs. For many organisations, energy costs are significant – for some industries they are the largest cost.

To lower energy costs, you first need to understand them… and where they come from. This means measuring or assessing the energy consumed by different processes and different part of your business – so that you know how much energy you are using and when you are using it. This might mean fitting smart meters or data loggers. Analysing the data helps you prioritise any further investigation – and identifies where to target savings and efficiency improvements.

Savings can be made by:

· Getting rid of energy-intensive processes or equipment (perhaps by changing to newer technology)

· Improving the efficiency of those processes that are essential to the business – again by changing the technology, fitting energy-saving components, improving maintenance, etc

· Taking measures (such as improving insulation) to avoid energy wastage and ‘leaks’

· Lowering the cost of the energy consumed

· Using technology to automate energy controls

· Considering small adjustments to the overall environment (by, for example, turning down the temperature by 1 or 2 degrees, or changing machine settings to lower energy usage … accepting that this might raise other costs … so you have to balance these out)

For example, controlling lighting and HVAC systems in a particular location or in an entire organization can be done with remote monitoring devices (so that spaces arte only lit when people are present).

Lowering the cost might be achieved by;

· Changing the type of energy used top power particular processes

· Changing supplier to reduce the cost

· Changing the tariff to one that provides lower overall costs

· Altering usage patterns to fit with lower-priced tariffs (e.g. heating premises overnight at lower tariff and allowing the buildings to release that heat throughout the day)

You need to ensure that everyone knows about the initiative and contributes ideas – so if you can’t do it yourself, appoint an ‘energy champion’. Consider having a fixed term ‘campaign’ (say, 3 months) so that people don’t get fed up with a slowly drifting project.

There may be grants available to help fund some of these changes .. since many of these will also help the environment as well as your bank balance.

If energy costs are a major component of total costs, it is probably worth getting an external expert to help – they will know things you don’t (like details of any grant schemes!).

Remember also that increasingly legislation and regulation will force you to adopt some of these measures. It is almost always better to do these things first according toy your own aims and timescale rather than being forced into ‘compliance mode’.


Productivity is my 'bag' ... it is what I know about. I am President of the World Confederation of Productivity Science - and Director of the National Productivity Centre in the UK - go to this site for some good free resources and some (paid for but low price) e-learning on productivity. I also edit the International Journal of Productivity & Performance Management. My views on productivity and on learning (which I think are related) are su...

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