It has been widely accepted that any facility without an energy management program cannot get sustainable energy savings. While some of the large Buildings and manufacturing Facilities has implemented such a program and benefitted from the same, it is the small- and mid-sized company that has several challenges in implementing such a program.

Barriers in implementing an energy management program in SME.

Despite having significant energy efficiency potential, there are several key barriers that hinder the ability to achieve energy savings at small- and mid-sized industrial and Commercial facilities. These include:

• End-users often lack the capital budget to self-finance energy efficiency investments.
• Efficiency projects at these facilities face the challenge of having to navigate an investment decision-making framework that places a heavy emphasis on optimizing manufacturing processes and ensuring continuous operation of plant assets.
• High ratio of transaction costs (i.e., conducting preliminary and detailed audits and establishing M&V protocols) to total project costs hinders the cost effectiveness of deals.
• Corporate capital budgeting processes place energy efficiency in direct competition with other core priorities, such as investments that expand production, increase throughput, and/or maintain overall plant reliability.
• Industrial firms have a short-term horizon for investments and typically require projects to have rapid payback periods.
• Lack of internal human resources to identify, execute, and verify energy conservation/efficiency projects.

The role of the energy manager

The time-shared energy manager would help in addressing specific barriers in these facilities and demonstrate the benefits of an energy management program by achieving sustainable cost reduction. He/she would also start building capacity in the plant for sustaining such a program. The major activities of the energy manager would be identification of projects, developing energy projects, selling energy management projects to senior management, carrying out energy performance analyses, demonstrating the value of energy and cost reduction to senior management, training and communication, help in formulating an energy team, identification of low cost opportunities, working with other partners in the industry, and communicating the benefits to all stakeholders.