Saving Energy Step 1 ? Implementing a Management System

There has been much hype down the years regarding whether management is art or science. Thankfully, where people are concerned the pendulum has swung away from standard times in sweatshops in the west. However, when it comes to measuring physical things like harvest per square meter and the amount of energy consumed there is no substitute for scientific measurement, and this implies a system.

Managing energy cost and consumption down is like any other strategy. American engineer / statistician / management consultant W. Edwards Demming may have passed on in 1993. However he was as right as ever when he said:

  1. When people and organizations focus primarily on quality, this tends to increase and costs fall over time.
  1. However, when people and organizations focus primarily on costs, costs tend to rise and quality declines over time.

Demming believed that 90% of organizational problems arise from systems we put in place ourselves. This can be because we are so accustomed to them that we fail to notice when they are no longer relevant. The currently prevailing laissez faire towards energy is a case in point. What is managed improves and what is not, deteriorates. We know this. Let us take a look at how to apply this principle to energy management.

First, you need to get the subject out the closet and talk about it. How often do you do this is your boardroom, and how does energy rank against other priorities? Good governance is about taking up a position and following through on it. Here is a handy checklist you may like to use.

  • Do we use a consistent language when we talk about energy? Is it electricity, or carbon emitted (or are we merely fretting over cost).
  • How well engaged are we as a company? Looking up and down and across the organization are there points where responsibility stops.
  • How well have we defined accountability? Do we agree on key performance areas and how to report on them.
  • Are we measuring energy use at each point of the business? When did we last challenge the assumption that ?we’re doing okay?.
  • Have we articulated our belief that quality is endless improvement, or are we simply chasing targets because someone says we should.

A management system is a program of policies, processes and methods to ensure achievement of goals. The next blog focuses on tools and techniques that support this effort.

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2015 ESOS Guidelines Chapter 1 ? Who Qualifies

The base criteria are any UK undertaking that employs more than 250 people and/or has a turnover in excess of ?50 million and/or has a balance sheet total greater than ?43 million. There is little point in attempting to separate off high polluting areas. If one corporate group qualifies for ESOS, then all the others are obligated to take part too. The sterling equivalents of ?38,937,777 and ?33,486,489 were set on 31 December 2014 and apply to the first compliance period.

Representatives of Overseas Entities

UK registered branches of foreign entities are treated as if fully UK owned. They also have to sign up if any overseas corporate element meets the threshold no matter where in the world. The deciding factor is common ownership throughout the ESOS system. ecoVaro appreciates this. We have seen European companies dumping pollution in under-regulated countries for far too long.

Generic Undertakings that Could Comply

The common factor is energy consumption and the organisation’s type of work is irrelevant. The Environmental Agency has provided the following generic checklist of undertakings that could qualify:

Limited Companies Public Companies Trusts
Partnerships Private Equity Companies Limited Liability Partnerships
Unincorporated Associations Not-for-Profit Bodies Universities (Per Funding)

Organisations Close to Thresholds

Organisations that come close to, but do not quite meet the qualification threshold should cast their minds back to previous accounting periods, because ESOS considers current and previous years. The exact wording in the regulations states:

?Where, in any accounting period, an undertaking is a large undertaking (or a small or medium undertaking, as the case may be), it retains that status until it falls within the definition of a small or medium undertaking (or a large undertaking, as the case may be) for two consecutive accounting periods.?

Considering the ?50,000 penalty for not completing an assessment or making a false or misleading statement, it makes good sense for close misses to comply.

Joint Ventures and Participative Undertakings

If one element of a UK group qualifies for ESOS, then the others must follow suit with the highest one carrying responsibility. Franchisees are independent undertakings although they may collectively agree to participate. If trusts receive energy from a third party that must do an ESOS, then so must they. Private equity firms and private finance initiatives receive the same treatment as other enterprises. De-aggregations must be in writing following which separated ESOS accountability applies.

The Rights of Individuals Under The General Data Protection Regulation

The General Data Protection Regulation or GDPR is a European Union law reinforcing the rights of citizens concerning the confidentiality of their information, and confirming that they own it. We thought it would be interesting to examine the GDPR effective 25 May 2018 from an Irish citizen?s perspective. This article is a summary of information on the Data Protection Commissioner?s website, but as viewed through a businessperson?s lens.

How the Office Defines Data Protection

The Office believes that organisations receiving personal details have a duty to keep them private and safe. This applies inter alia to information that individuals supply to government, financial institutions, insurance companies, medical providers, telecoms services, and lenders. It also applies to information provided when they open accounts.

This information may be on paper, on computers, or in video, voice, or photographic records. The true owners of this information, the individuals have a right:

  • To make sure that it is factually correct
  • To the assurance that it is shared responsibly
  • That all with access only use it for stated purposes

Any organisation requesting personal information must state who they are, what the information is for, why they need to have it, and to whom else they may provide it.

Consumer Rights to Access Their Personal Information

Private persons have a right under the GDPR to a copy of all their information held or processed by a business. The regulation refers to such businesses as ?data controllers? as opposed to owners, which is interesting. They have to provide both paper and digital data, and ‘related information?.

Data controller fees for this are discretionary within limits. The request may be denied under certain circumstances. The data controller may release information about children to parents and guardians, only if it considers a minor too young to understand its significance. Other third parties such as attorneys must prove they have consent.

Consumer Rights to Port Their Data to Different Services

Since the personal information belongs to the individual, they have a right not only to access it, but also to copy or move it from one digital environment to another. The GDPR requires this be ?in a safe way, without hindrance to usability?. An application could be a banking client that wants to upload their transaction history to a third party price comparison website.

However, the right to data portability only applies to data originally provided by the consumer. Moreover, an automated method must be available for porting. Data controllers must release the information in an open format, and may not charge for the porting service.

Consumer Rights to Complain About Personal Data Abuse

Individuals have a right under the General Data Protection Regulation to have their information rectified if they discover errors. This right extends to an assurance that third parties know about the changes – and who these third party entities are. Data controllers must respond within one month. If they decline the request, they must inform the complainant of their right to further remedial action.

If a data controller refuses to release personal information to the owner, or to correct errors, then the Data Protection Office has legal power to enforce the consumer?s rights. The complainant must make full disclosure of the history of their complaint, and the steps they have taken themselves to attempt to set things right.

Further Advice on Getting Things Ready for 25 May 2018

The General Data Protection Regulation has the full force of law from 25 May 2018 onward, and supersedes all applicable Irish laws, regulations, and policies from that date. We recommend incorporating rights of data owners who are also your customers into your immediate plans. We doubt that forgetting to do so will cut much sway with the Data Commissioner. Remember, you have one month to respond to consumer requests, and only one more month to close things out subject to the matter being complex.

Article 8 of the EU Energy Efficiency Directive ? Orientation

Following in-depth discussion of the UK?s ESOS response, we decided to backtrack to the source, especially since every EU member is facing similar challenges. The core purpose of the directive is to place a pair of obligations on member states. These are

  1. To promote the availability of energy audits among final customers in all sectors, and;
  2. To ensure that enterprises that are not SMEs carry out energy audits at least every four years.

Given the ability for business to look twice at every piece of legislation it considers unproductive, the Brussels legislators took care to define what constitutes an enterprise larger than an SME.

Definition of a Large Undertaking

A large undertaking meets one or both of the following conditions:

  1. It employs 250 or more people
  2. Its annual turnover is more than ?50 million and its balance sheet total exceeds ?43 million

Rules for Energy Audits

If accredited / qualified in-house specialists are unavailable then independent experts should supervise audits. The talent shortage seems common to many EU businesses. In hindsight, the Union could have ramped up slower, especially since the first compliance date of 5 December 2015 does not leave much swing room.

ecoVaro doubts there was a viable alternative, given the urgent imperative to beat back the scourge of carbon that is threatening the viability of our planet. The legislators must have been of a similar mind when laying down the guidelines. Witness for example the requirement that penalties be ?effective, proportionate and dissuasive?.

In order to be compliant, an energy audit must

  1. Be based on twelve months of verifiable data that is
    • over a continuous period beginning no more than 24 months before the beginning of the energy audit, and;
    • identifies energy saving opportunities including paths to their achievement
  2. Analyse the participant’s energy consumption and energy efficiency
  3. Have not been used as the basis for an energy audit in a previous compliance period

Measurement of current status and progress tracing are at the core of energy saving and good governance generally. EcoVaro has a powerhouse of software tools available on the cloud to help project teams save time and money.

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