Energy Management for Small Business

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					Florida Energy Extension Service
Energy Management for Small Business1
Charles J. Delaney2

What is energy management? Simply stated, energy management is a systematic approach to achieve more efficient and effective energy utilization in your daily business operations. Energy management involves more than just turning off unnecessary lighting, raising the thermostat setting on the air conditioner or reducing the hot water temperature. Energy management includes an analysis of past consumption trends, identification of high energy use areas and implementation of procedures to reduce waste and improve efficiency. This publication will serve as a guide in developing a formal plan to manage your energy use, just as you manage labor, inventory, accounts receivable and other aspects of your business. A formal plan will make it easier to set conservation goals and target the most cost effective energy conservation measures. In addition, an energy management plan (EMP) can: * provide a direct dollar return to the business -money not spent on energy costs never leaves your business be cost effective--many energy conservation measures have short payback periods improve the financial future of your business by cushioning it from future energy price increases be a low risk/high return investment give you a competitive advantage over businesses which do not carefully manage energy use.


The first important step in any EMP is to set up a recordkeeping system to determine how, where and when energy is consumed. Whether you have one building or many, you need to know the energy use pattern of each building. The person most familiar with the building in question should be the one to provide the necessary information. This information should include at least the following items for each building, work area or department: * hours of occupancy for each day of the week and number of people occupying the space at different times of the day hours during which heating, ventilation and air conditioning (HVAC) equipment operates cleaning hours thermostat setting any remarks or notes pertaining to extraordinary conditions.


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Once this information is compiled, it will allow you to see where your operations might be changed to save energy and money. For instance, you should look at whether or not it would be feasible to have custodial services performed during normal working hours rather than after business hours. Or, could some activities be combined or rescheduled to cut back on the hours of HVAC use.The important thing to remember is the more detail that is provided the better able you will be to identify potential areas for energy savings.

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This document was published as Fact Sheet EES-29, Florida Energy Extension Service. For more information, contact your county Cooperative Extension Service office. Assistant Director, Florida Extension Service, Institute of Food and Agricultural Sciences, University of Florida, Gainesville.

The Florida Energy Extension Service receives funding from the Governor’s Energy Office. The information contained herein is the product of the Florida Energy Extension Service and does not necessarily reflect the views of the Governor’s Energy Office.
The Institute of Food and Agricultural Sciences is an Equal Opportunity/Affirmative Action Employer authorized to provide research, educational information and other services only to individuals and institutions that function without regard to race, color, sex, or national origin. Florida Cooperative Extension Service / Institute of Food and Agricultural Sciences / University of Florida / Christine Taylor Stephens, Dean

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are engaged in the same type of business, each has significantly different energy use patterns or profiles.

The next step is to compile a monthly record of your energy use for the last 3-5 years showing the amount and type of energy used. To compile an accurate record you will need to know how to read your utility bills. In many cases you will have more than one bill. Electricity, natural gas, liquid propane gas (LPG) and #2 fuel oil are all fuel types that may be used in your billing system. If you need help in deciphering the bill, give the utility company’s service representative a call. The information compiled in this manner will provide a good base from which to build your EMP. Be sure to graph the data you have compiled on energy consumption. This will depict months of high and low usage and provide you additional insight into where problem areas might exist (see Figure 1). In Florida, most businesses will show the greatest energy consumption in July and August when air conditioning demand is heaviest. Increased heating loads could account for a sharp peak in your graph in January and February, especially in North Florida. Once you’ve compiled all utility information, you need to put it into a form which allows comparison on a similar basis. One simple method is to measure the number of BTU (British thermal units) used annually per gross square foot of building space. This is frequently referred to as the building energy index (BEI). A list of common fuels and their BTU equivalents is given in Table 1. At this point you may ask, "Is it really necessary to draw graphs illustrating energy use and fill in charts?" No, not really, but it is probably the only way you will be able to accurately assess your progress. Later on this effort Will prove useful in demonstrating to upper management and employees the impact your EMP has had on reducing energy consumption and saving dollars for the business. Recordkeeping of this nature is a good way to compare your operation to that of others in the same business or industry. It’s only natural to want to know how your business operation stacks up against the competition. But remember, BEIs will vary drastically from one building to the next, so don’t compare apples with oranges. For instance, fast food restaurants typically spend three times as much on lighting as restaurants featuring only table service. On the other hand, the amount of energy consumed heating water in a restaurant offering table service exclusively is 12 to 13 times that used in a fast food establishment. While both

The next step in developing your energy management plan is to determine the portion of total energy used by each system in your building. You will want to know, for instance, how much of your total electric bill is attributable to the operation of the HVAC system. You will want to measure the amount of time that lights, motors, pumps and compressors are on to estimate electrical use. Submetering and/or installation of recording equipment may have to be done in order to get a reasonable estimate of how much each system uses during the course of a month or a year. Unless you have relevant technical background, it would be wise to call your utility to get assistance with this. Undoubtedly, you realize this process is time consuming, but it is the only reliable method you have for making rational and cost effective decisions regarding which energy conservation measures to implement.

The final step prior to enacting your overall energy management plan is to have an audit performed on your business property. An audit is a detailed examination of your building(s) and mechanical systems to identify possible modifications to improve energy efficiency. Audits vary a great deal in complexity and length of time to perform, but once again your utility should be able to help at little or no cost to you. If your utility does not provide this service, then you may wish to hire a consultant. This will undoubtedly be more expensive than what a utility might charge, so use care in selecting the auditor. Don’t hesitate to ask for references or check with previous clients. After all, it’s your money that’s paying for this service. Once the audit has been completed you will be provided with a detailed report. The report will include a comprehensive list of energy conservation measures that you can implement to cut down on energy waste and improve the overall energy efficiency of your operations. Some of the measures listed will be low, or possibly no, cost items that you can do right away. Others will be more costly and may even require a large capital outlay. If this is the case, you should make use of financial analysis techniques available to you to determine whether or

Page 3 not a large capital outlay for energy efficiency is warranted. Whatever your decision, you should remember that an investment in energy efficiency is a long term investment. lt will provide benefits in the form of reduced operating costs for as long as your business remains in operation. Whether you view energy management in terms of reduced costs or cost avoidance, managing energy use should be an integral part of your business, equally important as the system you use in managing labor, inventory and capital.

Figure 1. Annual Energy Use Graph.

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Building Energy Index Calculation Record of fuel use by type Month Electricity (kwh) Fuel oil (gal) Natural gas (CCF*) LP gas (gal)

January February March April May June July August September October November December Totals *CCF, or therm, equals 100 cu. ft. Fuel Totals Electricity Fuel Oil Natural Gas LP Gas ____________ kwh x 3413 BTU/kwh ____________ gal x 140,000 ____________ CCF x 100,000 ____________ gal x 91,600 Total Fuel Use Building energy index calculation: BEI = BTU/yr ÷ sq ft Building energy index = ______________________ BTU/sq ft/yr Conversion to BTU equivalents = __________ BTU = __________ BTU = __________ BTU = __________ BTU = __________ BTU

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