The second annual Enterprise Smart Grid conference, organized by Groom Energy, played to a packed room at the Logan Airport Embassy Suites hotel in Boston, Massachusetts. Held in November 2011, the event was preceded by a half-day ISO 50001 overview.
Day two of the event – the actual conference – began with an overview of the Enterprise Smart Grid (ESG and Corporate Energy Management (CEM. Among the key takeaways from the opening presentation were the limitations of current utility bill reporting for guiding an organization's daily energy use decisions. The more organizations can control their energy use, the more money they can save. Enter ESG: By integrating a host of the latest software, hardware and metering technologies, companies can tap into huge cost savings opportunities.
ESG is defined as a method that permits an intelligent network to align with business processes to capture data that allows management a better understanding and better management of energy consumption within their organization. An added attraction of ESG is that the function is also liked to the profit-and-loss accounting center. The components at the functional level of the ESG include:
- Submeters and spot metering of the main and largest energy loads.
- Electric, gas, water and steam measurement.
- Energy and system control technologies.
- Premise, cloud or SaaS-based energy management software.
- Connection to the organization's profit and loss (PL statements.
- Understanding of utility rate structures and time-of-use impacts on production.
Following sessions showcased how some corporations structure their corporate energy management programs, and described what works best for their companies. Representatives from Millipore, Genzyme and Harvard University shared their user experiences with the audience. From the service provider side, representatives from EnerNOC and Schneider Electric provided insight into demand response programs, which continue to be a huge success. The afternoon sessions focused on how some companies are overcoming barriers to energy efficiency projects, including the use of supplier scorecards to track the energy awareness and sustainability progress of suppliers.
Sustainability into Supplier Scorecards
Tim Greiner of Pure Strategies talked about how supplier scorecards with questions about energy can help companies track energy consumption and energy performance as energy reduction metrics.
Why are some companies taking a closer look at energy consumption as they analyze the scorecard results? Greiner sees cost reduction, brand image and global development trends as prompts for this heightened interest. As a validator, Greiner cited values obtained from US Green Data [http://usgreendata.com] that say a driver for supplier scorecards is a company's desire to understand its carbon footprint and how reducing energy use meshes with being green via lower-cost supply chains.
Energy questions on supplier scorecards might include energy measurements, goals and targets, and scope (facility vs. company-wide. Buyers might also want to ask whether any goals are ambitious enough.
To the question, "Why would Walmart care about what its suppliers' energy costs are?" Greiner replied that any decrease in Walmart's costs is passed to its customers and increases its competitive edge. "That's huge to a large customer like Walmart."
Of the 15 questions on Walmart's Supplier Sustainability Assessment, Greiner noted, is that in the Energy and Climate area, four refer to climate, none to energy.
By contrast, Procter and Gamble (PG's scorecard includes energy questions that drill down to include both kWh used and total energy usage (electric and fuel. Greiner added that the lead group responsible for pursuing scorecards was PG's purchasing department, not its sustainability group. PG has said it will showcase its top performers. One group devoted to creating a science-based system to score consumer products is the Sustainability Consortium, headed by the University of Arkansas and Arizona State. Members include Alcoa, Bayer, Cargil, Mars, Basf, LG and PG.
Greiner said, if we can identify the hot spots, we can ask suppliers the right questions – if scorecards don't truly reflect the desired process or outcome, they won't really be useful. Another key consideration is whether we should we ask process-focused questions (like ISO 50001. Greiner observed that so far, if a supplier did well in every other area, but poorly in sustainability, it wouldn't necessarily be penalized, but that is changing.
Supplier scorecards that reflect sustainability – specifically energy consumption and performance – can speak volumes about the energy efficiency of a supplier's equipment and whether this is an area they should evaluate for possible retrofits or complete replacement, and carry any new values forward to next year's scorecard. Such data is also important within an ISO 14001 environmental management system (EMS in which, for example, energy savings or reduction is among the objectives set by an organization.
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