Energy Audit and Management

Energy Audit and Management
This book is a part of the course by Jaipur National University, Jaipur.

This book contains the course content for Energy Audit and Management.
JNU, Jaipur
First Edition 2013
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content whenever the need arises, and to vary it at any time without prior notice.
Index
I. Content....................................................................... II
II. List of Figures..........................................................VI
III. List of Tables........................................................ VII
IV. Abbreviations......................................................VIII
V. Case Study.............................................................. 105
VI. Bibliography......................................................... 112
VII. Self Assessment Answers................................... 114
Book at a Glance
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Contents
Chapter I........................................................................................................................................................ 1
General Aspects of Energy Management.................................................................................................... 1
Aim................................................................................................................................................................. 1
Objectives....................................................................................................................................................... 1
Learning outcome........................................................................................................................................... 1
1.1 Introduction to Energy Management........................................................................................................ 2
1.2 Strategy for Energy Management............................................................................................................. 3
1.3 Energy Audit............................................................................................................................................. 4

1.3.1 Need for Energy Audit.............................................................................................................. 4

1.3.2 Styles of Energy Audit.............................................................................................................. 4
1.4 Energy Costs............................................................................................................................................. 5
1.5 Benchmarking........................................................................................................................................... 5
1.6 System Efficiencies................................................................................................................................... 6
1.7 Fuel Substitution....................................................................................................................................... 6
1.8 Energy Audit Instruments......................................................................................................................... 7
1.9 Cases - Energy Management Styles.......................................................................................................... 9
Summary.......................................................................................................................................................11
References.....................................................................................................................................................11
Recommended Reading...............................................................................................................................11
Self Assessment............................................................................................................................................ 12
Chapter II.................................................................................................................................................... 14
Procedures and Techniques........................................................................................................................ 14
Aim............................................................................................................................................................... 14
Objectives..................................................................................................................................................... 14
Learning outcome......................................................................................................................................... 14
2.1 Introduction............................................................................................................................................. 15
2.2 Scope of Energy Audit............................................................................................................................ 15
2.3 Energy Audit Activity............................................................................................................................. 15
2.4 Energy Auditing Team............................................................................................................................ 16
2.5 Preparing for the Audit............................................................................................................................ 17

2.5.1 Scheduling.............................................................................................................................. 17

2.5.2 Instrumentation....................................................................................................................... 17

2.5.3 Measurements......................................................................................................................... 17
2.6 Controlling Energy Use.......................................................................................................................... 18

2.6.1 Questionnaire for Data Gathering........................................................................................... 18

2.6.2 Electricity Consumption......................................................................................................... 18

2.6.3 Time-of-use Rates................................................................................................................... 19

2.6.4 Reducing Peak Demand.......................................................................................................... 19

2.6.5 Improving the Power Factor................................................................................................... 19

2.6.6 Fuel Billing............................................................................................................................. 19
2.7 Analytical Techniques............................................................................................................................. 19

2.7.1 Incremental Cost Concept....................................................................................................... 19

2.7.2 Inventory of Energy Inputs and Rejections............................................................................ 20

2.7.3 Heat Transfer Calculations...................................................................................................... 20

2.7.4 Evaluation of Electric Load Characteristics........................................................................... 21
2.8 Evaluation of Saving Opportunities........................................................................................................ 23
2.9 The Plant Energy Study Report.............................................................................................................. 24
Summary...................................................................................................................................................... 25
References.................................................................................................................................................... 25
Recommended Reading.............................................................................................................................. 25
Self Assessment............................................................................................................................................ 26
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Chapter III................................................................................................................................................... 28
Energy Balance............................................................................................................................................ 28
Aim............................................................................................................................................................... 28
Objectives..................................................................................................................................................... 28
3.1 Introduction............................................................................................................................................. 29
3.2 Facility as an Energy System.................................................................................................................. 29

3.2.1 First Law and Second Law Efficiencies................................................................................. 29
3.3 Energy and Mass Balance....................................................................................................................... 30
3.4 Method for Preparing an Energy Flow Diagram.................................................................................... 31
3.5 Quantifying Energy Flows...................................................................................................................... 33

3.5.1 Energy Balance Sheet............................................................................................................. 33
3.6 Energy Balance Diagrams for Typical Facilities.................................................................................... 35

3.6.1 Thermal Power Plant.............................................................................................................. 35

3.6.2 Paper Industry......................................................................................................................... 36
Summary...................................................................................................................................................... 38
References.................................................................................................................................................... 38
Self Assessment . ......................................................................................................................................... 39
Chapter IV................................................................................................................................................... 41
Energy Monitoring, Targeting, Review and Evaluation......................................................................... 41
Aim............................................................................................................................................................... 41
Objectives..................................................................................................................................................... 41
4.1 Introduction to Energy Monitoring and Targeting.................................................................................. 42

4.1.1 Elements of the Energy Monitoring and Targeting Systems ................................................. 42

4.1.2 A Rationale for Monitoring, Targeting and Reporting............................................................ 43
4.2 Data and Information Analysis............................................................................................................... 43
4.3 Data Monitoring...................................................................................................................................... 44

4.3.1 Data Collection....................................................................................................................... 44

4.3.2 Data Analysis.......................................................................................................................... 45

4.3.3 Regression Analysis................................................................................................................ 45
4.4 CUSUM.................................................................................................................................................. 47
4.5 Target Setting.......................................................................................................................................... 49

4.5.1 Target Values........................................................................................................................... 49
4.6 Reporting................................................................................................................................................. 50
Summary...................................................................................................................................................... 51
References.................................................................................................................................................... 51
Self Assessment............................................................................................................................................ 52
Chapter V..................................................................................................................................................... 54
Energy Audit/Management Case Studies.............................................................................................. 54
Aim............................................................................................................................................................... 54
Objectives..................................................................................................................................................... 54
5.1 Introduction............................................................................................................................................. 55
5.2 Case Studies on Thermal Energy Management...................................................................................... 55

5.2.1 Control of Excess Air in Fluidised Bed Combustion (FBC) Boilers...................................... 55

5.2.2 Reduction in Distribution Losses in Steam Distribution Lines by Revamping the Insulation.56

5.2.3 Refrigeration - Speed Reduction of Chilling Plant Compressors .......................................... 56

5.2.4 Sugar Industry - Back-pressure Steam Turbine and Bagasse Fired Boiler . .......................... 57

5.2.5 Chemical Industry - Heat Recovery from Exhaust Gas in a Spray Dryer.............................. 59
5.3 Case Studies on Electrical Energy Management.................................................................................... 60
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5.3.1 Optimising Transformer Loading........................................................................................... 60

5.3.2 Operation in Star Connection for Under Loaded Motors....................................................... 61

5.3.3 Replacement of Pump Impellers at a Synthetic Yarn Plant.................................................... 61

5.3.4 Use of Lighting Voltage Controller to Reduce Lighting Energy Consumption...................... 62

5.3.5 Thermostat Based Operation of Cooling Tower Fan.............................................................. 62

5.3.6 Automobile Industry - Reciprocating Engine System............................................................ 63
5.4 Barriers to Successful Implementation................................................................................................... 65
5.5 Examples of Projects not Implemented.................................................................................................. 66

5.5.1 Use of Soft Starter on Mechanical Presses............................................................................. 66

5.5.2 Use of Roots Blower in Place of Air Compressors for Agitation........................................... 67

5.5.3 Steam Trap Management........................................................................................................ 68

5.5.4 Use of Energy Efficient Ladle Preheating System................................................................. 69
Summary...................................................................................................................................................... 70
References.................................................................................................................................................... 70
Self Assessment............................................................................................................................................ 71
Chapter VI................................................................................................................................................... 73
Project Planning.......................................................................................................................................... 73
Aim............................................................................................................................................................... 73
Objectives..................................................................................................................................................... 73
6.1 Introduction to Production Management................................................................................................ 74
6.2 Project Definition and Scope.................................................................................................................. 75

6.2.1 Four Basic Elements of Project Management......................................................................... 75

6.2.2 Project Management Life Cycle............................................................................................. 75
6.3 Technical Design..................................................................................................................................... 77
6.4 Financing................................................................................................................................................. 77
6.5 Contracting.............................................................................................................................................. 78

6.5.1 Recommendation for Scope of Work...................................................................................... 79
6.6 Implementation....................................................................................................................................... 80
6.7 Performance Monitoring......................................................................................................................... 81
6.8 Measurement and Verification................................................................................................................ 81
Summary...................................................................................................................................................... 83
References.................................................................................................................................................... 83
Self Assessment............................................................................................................................................ 84
Chapter VII................................................................................................................................................. 86
Energy Policy Planning and Implementation.......................................................................................... 86
Aim............................................................................................................................................................... 86
Objectives..................................................................................................................................................... 86
7.1 Introduction to Key Elements of Energy Management System.............................................................. 87
7.2 Management Decision Making Tools..................................................................................................... 87

7.2.1 Force Field Analysis............................................................................................................... 87

7.2.2 Six Thinking Hats................................................................................................................... 89
7.3 Energy Management System.................................................................................................................. 90

7.3.1 Top Management Commitment and Support . ....................................................................... 91

7.3.2 Reviewing Performance.......................................................................................................... 93

7.3.3 Set Goals................................................................................................................................. 97

7.3.4 Create Action Plan.................................................................................................................. 97

7.3.5 Implement Action Plan........................................................................................................... 98

7.3.6 Evaluate Progress.................................................................................................................... 99

7.3.7 Recognise Achievements...................................................................................................... 100
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7.4 Information Systems............................................................................................................................. 100

7.4.1 Barriers.................................................................................................................................. 101
Summary.................................................................................................................................................... 102
References.................................................................................................................................................. 102
Recommended Reading............................................................................................................................ 102
Self Assessment.......................................................................................................................................... 103
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List of Figures
Fig. 1.1 Issues addressed by energy management strategy............................................................................. 3
Fig. 2.1 Energy audit work flow diagram..................................................................................................... 16
Fig. 2.2 Electrical demand profile................................................................................................................. 21
Fig. 2.3 Motor efficiency and power factor.................................................................................................. 22
Fig. 3.1 Equipment and system performance................................................................................................ 30
Fig. 3.2 Energy flow diagram....................................................................................................................... 30
Fig. 3.3 Energy and mass flow diagram for textile processing..................................................................... 33
Fig. 3.4 Energy balance diagram coal fired power plant........................................................................... 36
Fig. 3.5 Energy and material flow diagram of paper industry...................................................................... 36
Fig. 4.1 Data-analysis-information-action.................................................................................................... 44
Fig. 4.2 Regression analysis for a paper industry......................................................................................... 45
Fig. 4.3 Regression analysis.......................................................................................................................... 47
Fig. 4.4 CUSUM chart.................................................................................................................................. 48
Fig. 5.1 Sugar mill cogeneration system....................................................................................................... 59
Fig. 5.2 Heat recovery- spray dryer.............................................................................................................. 60
Fig. 5.3 Gas engine based cogeneration plant............................................................................................... 65
Fig. 6.1 Basic ingredients in project management........................................................................................ 74
Fig. 6.2 Process flow of a project management process............................................................................... 76
Fig. 7.1 The 4 pillars of successful energy management.............................................................................. 87
Fig. 7.2 Field force analysis.......................................................................................................................... 88
Fig. 7.3 Steps in energy action planning....................................................................................................... 90
Fig. 7.4 Organisation structure of energy management................................................................................ 92
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List of Tables
Table 1.1 Energy audit instruments................................................................................................................. 9
Table 3.1 Sub-systems.................................................................................................................................. 31
Table 3.2 Energy inflows to sub-systems...................................................................................................... 32
Table 3.3 Energy outflow from sub-systems................................................................................................ 32
Table 3.4 Energy and mass balance calculations.......................................................................................... 34
Table 3.5 Desizing process-energy and mass balance.................................................................................. 34
Table 3.6 Bleaching process- energy and mass balance............................................................................... 35
Table 3.7 Energy index of paper mills.......................................................................................................... 37
Table 4.1 Summary of production and energy consumption........................................................................ 46
Table 4.2 Actual and expected energy consumption..................................................................................... 48
Table 5.1 Compressor speed reduction......................................................................................................... 57
Table 5.2 Pump impeller replacement.......................................................................................................... 62
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Abbreviations
BEE
CDM
CHP
CII
CNC
CPM
CPP
CUSUM
DBs
ECMs
EEMs
EMIS
ESCO
FBC
LDO
LED
LPG
LSHS
M&V
NPV
PERT
PF
PIs
RTD
RTD
SEB
SGA
VFD
WHRB
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-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Bureau of Energy Efficiency

Clean Development Mechanism
Combined Heat and Power
Confederation of Industrys
Computer Numerical Control
Critical Path Method
Captive Power Plant
Cumulative SUM of Differences
Distribution Boxes
Electronic Countermeasures
Efficient Energy Mortgage
Energy Management Information System
Energy Service Company
Fluidised Bed Combustion
Light Diesel Oil
Light-Emitting Diode
Liquefied Petroleum Gas
Low Sulphur Heavy Stock
Measurement and Verification
Net Present Value
The Program Evaluation and Review Technique
Power Factor
Performance Indicators
Resistance Temperature Detector
Resistance Temperature Device
State Electricity Boards
Small Group Activity
Variable Frequency Drive
Waste Heat Recover Boiler
Chapter I
General Aspects of Energy Management
Aim
The aim of this chapter is to:

introduce the concept of energy management
highlight the importance of energy audit
explain the fuel substitution theory
Objectives
The objectives of this chapter are to:

explain the goals and strategies of energy management
analyse the real time cases of energy management styles
emphasize the importance of need and styles of energy audit
Learning outcome
At the end of this chapter, you will be able to:

understand the concept of system efficiency
understand the working of energy audit instruments
learn how to benchmark energy consumption
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1.1 Introduction to Energy Management

Energy management is defined as the strategy of adjusting and optimising energy, using systems and procedures
so as to reduce energy requirements per unit of output, while holding constant or reducing total costs of producing
the output from these systems. The objectives of energy management are:

to achieve and maintain optimum energy procurement and utilisation, throughout the organisation
to minimise energy costs / waste without affecting production & quality
to minimise environmental effects
Evolution of energy management

Energy management has evolved over the years from a knee jerk reaction to the oil crises of the 1970s to an expanded scope
that integrates energy conservation, energy efficiency, cost optimisation, environment protection and energy security.
The implications of energy management depends upon the context whether global, national, sectoral or within the
boundaries of an organisation.

At the global level, energy management concerns with the politics of oil, this is concentrated in Middle East
Asia, and the issues of environmental impact of excessive and inequitable energy consumption.
In India, at the national level, energy management primarily addresses the issue of energy security and per
capita energy consumption.
At the sectoral level (i.e., industrial, agriculture, commercial, domestic etc.) energy management generally
concerns with energy benchmarking and related technological issues.
At the organisational level, energy management mainly confines itself to energy cost reduction, economical
energy source alternatives, energy efficiency improvement and reduction of carbon emissions.
Since independence, our electricity generation capacity has increased from about 5000 MW to 110000 MW. Capacity
additions in other sectors like oil refining, mining etc. are all indications of substantial energy supply side growth of our
economy. The area where adequate attention has not been paid effectively is energy and resource conservation.
Countries like Canada, Japan and UK had realised the need for energy conservation after the oil crisis and established
institutions to focus on the subject. In India, Energy Conservation Act which enabled setting up of Bureau of Energy
Efficiency (BEE) under Ministry of Power was enacted only in 2001.
Energy management is an integral part of cost reduction strategy to improve competitiveness. Energy management
addresses issues related to energy costs, energy efficiency, secure energy supplies, alternative energy sources and
abatement of environmental pollution.
Greenhouse gases are polluting gaseous emissions that are leading to rise in the atmospheric temperature or leading
to ozone depletion in the atmosphere. The Kyoto Protocol has been ratified by most of the major member nations
(excluding the USA) of the United Nations.

It specifies a mandatory 5.2 % reduction in Carbon emission by the developed nations with 1990 as the baseline
year.
The Clean Development Mechanism (CDM) is a part of the global strategy proposed by the Kyoto Protocol
(1997) to combat atmospheric build-up of greenhouse gases. CDM is a mechanism for trading of Carbon credits
to help the developed nations buy Carbon credits from developing nations, to achieve their carbon emission
reduction targets.
Another mechanism called Emission Trading is the trading of carbon credits between developed nations. Energy
efficiency improvement and fuel switching to less polluting fuels are acceptable methods to reduce carbon
emissions.
Participation in these global endeavours is now a part of the corporate policy of some organisations. In India,
some organisations are undertaking CDM projects with the objective of participating in the global trading of
carbon credits.
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1.2 Strategy for Energy Management

Successful energy management calls for a well thoughtout strategy that addresses issues related to the organisation,
people, technology and finance.
Organisation
Technology
Energy
Management
People
Finance
Fig. 1.1 Issues addressed by energy management strategy

Organisation
Energy management, like any other management issue, rarely succeeds without the commitment of the top
management. The top management has to recognise that the energy cost is a manageable expense and that there is a
scope for reduction. Depending on the size and technological sophistication of the organisation, it has to spell out an
energy management policy and create the right structure within the organisation for controlling this cost centre.
The subject being inter-disciplinary in nature, the created structure like an Energy Management Committee or cell
should have representation from all major departments. Senior persons with decision making authority should be
the members of this committee or cell.
People
To ensure widespread support to the decisions of the energy management cell, people at all levels of the organisation
have to be sensitised to this issue by conducting large number of focused training programmes. This is absolutely
important in situations wherein significant energy cost reduction is targeted through operational changes. All members
of the organisation should be aware of the energy cost being incurred by the organisation and the competitive pressures
to reduce production costs. Members of the energy conservation cell and senior decision makers of all departments
should be given specialised training on energy management to enable them to take informed decisions.
Technology
The energy management strategy should be able to clearly elucidate the energy implications of the vintage of
technology in use. It should also be able to identify areas where better engineering practices can reduce energy
losses and improve the overall energy efficiency. It should be able to follow the market trends in fuel prices and
identify alternative fuel options.
Finance
Energy management projects meeting the financial criteria of the organisation should be accommodated in the
organisational budget. Active involvement of decision makers from finance in the core energy management group
is needed to ensure that the benefits are quantified in a manner that the project gets the deserved priority and finance
is allocated. Non-involvement of finance personnel may result in rejection of the project for frivolous reasons.
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Energy management strategies with the above four components, a designated energy manager and an energy
conservation cell have a reasonable chance to succeed.
1.3 Energy Audit

As per the Energy Conservation Act, 2001, energy audit is defined as the verification, monitoring and analysis of
use of energy including submission of technical report containing recommendations for improving energy efficiency
with the cost benefit analysis and an action plan to reduce energy consumption.
1.3.1 Need for Energy Audit

Its primary objective is to determine ways to reduce energy consumption per unit of product output or to lower
operating costs.
It helps in understanding more about the ways energy and fuel are used in any industry and in identifying the
areas where waste can occur and where scope for improvement exists.
It gives a positive orientation to the energy cost reduction, preventive maintenance and quality control programmes
which are vital for production and utility activities. Such an audit programme will help to keep focus on variations
which occur in the energy costs, availability and reliability of supply of energy and decide on appropriate energy
mix. It also identifies energy conservation technologies and retrofit for energy conservation equipment etc.
It converts ideas into reality, by lending technically feasible solutions with economic and other organisational
considerations within a specified time frame.
It provides a bench-mark (Reference Point) for managing energy in the organisation and also provides the
basis for planning for a more effective use of energy throughout the organisation.
1.3.2 Styles of Energy Audit

The style of energy audit to be performed depends on the following factors:

function and type of industry
depth to which final audit is needed
potential and magnitude of cost reduction desired
Thus, energy audit can be classified into the three categories as under:

Walk-thru Audit
Preliminary Audit
Detailed Audit
Walk-thru audit
Walk thru energy audit involves physical observation of operation of equipments and processes to visually identify
glaring deficiencies, identifying areas worthy of further study and checking compliance with previously recommended
measures. No measurements are taken during this type of energy audit. This type of energy audit is usually conducted
by consultants before preparation of a techno-commercial proposal for a preliminary or detailed energy audit. It is
also done by plant personnel (like members of energy conservation cell) to identify obvious energy wastages and
maintain surveillance on previously implemented measures.
Preliminary energy audit methodology
Preliminary energy audit is a relatively quick exercise to:

Establish energy consumption in the organisation.
Estimate the scope for saving.
Identify the most likely and the easiest areas for attention.
Identify immediate (especially no-/low-cost) improvements/ savings.
Set a reference point.
Identify areas for more detailed study/measurement.
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Detailed energy audit methodology

A comprehensive audit provides a detailed energy project implementation plan for a facility, since it evaluates all
major energy using systems. This type of audit offers the most accurate estimate of energy savings and cost. It
considers the interactive effects of all projects, accounts for the energy use of all major equipments and includes
detailed energy cost saving calculations and project cost.
In a comprehensive audit, one of the key elements is the energy balance. This is based on an inventory of energy
using systems, assumptions of current operating conditions and calculations of energy use. This estimated use is
then compared to utility bill charges.
Detailed energy auditing is carried out in three phases: Phase I, II and III.

Phase I - Pre Audit Phase
Phase II - Audit Phase
Phase III - Post Audit Phase
An extension of the detailed energy audit is the so called Investment Grade Energy Audit, wherein the detailed
energy audit results in a project report that can be the basis for receiving complete commercial proposals from
implementing agencies like vendors and contractors.
1.4 Energy Costs

Understanding energy cost is a vital factor for awareness creation and saving calculation. In many industries sufficient
meters may not be available to measure all the energy used.
Energy costs need to be understood from three angles:

the direct energy cost for an energy resource
implied energy cost of utilities
implied energy cost of process routes
Direct cost of an energy resource

Direct cost implies the landed cost of any energy source, typically primary energy resources like coal, fuel oil,
natural gas, agro-briquettes etc or secondary energy resource like electricity.
Implied cost of process routes
There may be various process routes to manufacture a product. Some process routes may be more energy intensive
due to thermodynamic limitations or due to their demand for energy intensive supporting utilities.
Implied energy cost of utilities
Processes use various utilities like compressed air, chilled water, air-conditioning, steam, heated thermal fluid,
gaseous or liquid nitrogen etc. The cost of these utilities depends upon the energy source used to generate them and
the conversion efficiencies. Due to various thermodynamic and technological factors, certain utilities are extremely
expensive. Prudent energy management requires an understanding of the energy intensities of each of these utilities
and their implied energy cost.
A clear understanding of the direct cost of energy resources, the implied cost of process routes and supporting utilities
is required to develop focused energy management strategies that are sustainable in the long term.
1.5 Benchmarking
The specific energy consumption per unit of production or service provided is a measure of the level of energy
efficiency and is usually a convenient benchmark for comparison of equipments, systems and processes from the view
point of energy efficiency. Benchmarking is an effective method for ranking the energy performance. Benchmarking
can be done for a whole organisation, a production or service department, and a production line or equipment.
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Benchmarking of energy consumption internally (historical / trend analysis) and externally (across similar industries)
are two powerful tools for performance assessment and logical evolution of avenues for improvement.
Well documented historical data helps to bring out energy consumption and cost trends month-wise/day-wise. Trend
analysis of energy consumption, cost, relevant production features, specific energy consumption, helps to understand
effects of capacity utilisation on energy use efficiency and costs on a broader scale.
External benchmarking relates to inter-unit comparison across a group of similar units. However, it would be
important to ascertain similarities, as otherwise findings can be grossly misleading. Few comparative factors, which
need to be looked into while benchmarking externally are:

scale of operation
vintage of technology
raw material specifications and quality
product specifications and quality
1.6 System Efficiencies

Every system can be broken up into sub-systems, which may comprise of a number of equipments, which in turn
comprise of mechanical and chemical processes like compression, heat transfer, chemical change etc. Understanding
and quantifying the minimum energy required for any useful process in adherence to laws of thermodynamics and
measurement of the actual energy consumed provides insight that opens up new avenues for improvement of energy
efficiencies of processes and equipments. However, a clear understanding of thermodynamic and technological
limitations is necessary to practically improve system efficiencies.
Example: Designing a system which uses gravity for material movement or that which relies on natural heat transfer
processes helps improve system efficiencies.
Similarly, information on the most energy efficient process and equipment technologies can help improve system
efficiencies. Practical limitations like costs involved for maximising the energy efficiency, prevailing energy costs,
operational convenience etc. have to be given due credence, hence optimisation of energy efficiency, within these
limitations, is usually the goal of organisations with serious energy management programmes.
Once the energy usage and sources are matched properly, the next step is to operate the equipment efficiently through
best practices in operation and maintenance as well as judicious technology adoption.
1.7 Fuel Substitution

Fuel substitution: Substituting existing fossil fuel with more efficient and less cost/less polluting fuel such as
natural gas, biogas and locally available agro-residues.
Energy cost is a serious issue in almost all organisations, even those without any formal energy management
programmes. As part of the production cost control strategy, the price of various fuels and energy sources like coal,
fuel oil and electricity is generally monitored with the objective of using fuel of an acceptable quality from the
cheapest source.
With liberalisation of the economy and the entry of private players in the energy market in past decade, users now
have more fuel options. The options may be limited by quality and type of fuels that can be used in the available
combustion equipment in adherence to pollution control laws. However, with the increasing prices of certain fuels
and electricity, users are also investing in new combustion equipments to avail the benefits of a cheaper fuel.
Fuel substitution has taken place in all the major sectors of the Indian economy. Kerosene and Liquefied Petroleum
Gas (LPG) have substituted soft coke in residential use.
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Few examples of fuel substitution are:

Natural gas is increasingly the fuel of choice as fuel and feedstock in the fertilizer, petro chemicals, and power
and sponge iron industries.
Replacement of coal by coconut shells, rice husk etc.
Replacement of LDO by LSHS.
1.8 Energy Audit Instruments

The effectiveness of an energy audit depends on the identification of energy saving projects that can be practically
implemented. Realistic techno economics of proposed projects can be estimated only if the existing energy
consumption and process parameters are measured with reasonable accuracy. Both installed plant instrumentation
and portable instruments have to be used to measure various parameters.
In the Indian industry, the plant instrumentation is usually restricted to the minimum level that is required to maintain
production, quality and safety. Installed instrumentation is generally not sufficient to estimate the energy efficiency
and energy losses in the existing system.
Portable instruments are generally used by energy auditors to measure various operating parameters like electrical
power, pressure, flow, temperature, flue gas composition etc.
Name of the Instrument
Electrical power
analyser
Fuel gas analyser
Figure
Description
These are instruments for measuring major

electrical parameters, such as, kVA, kW, PF,
Hertz, kVAr, Amps and Volts. In addition to
this, some of these instruments also measure
harmonics. These instruments are applied on-line
i.e., on running motors without any need to stop
the motor. Instant measurements can be taken
with hand-held meters, while more advanced
ones facilitate cumulative readings with print
outs at specified intervals.
This device is used to measure fuel gas

composition i.e., CO2, O2, CO etc.
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Temperature
measuring device
This device is used to measure temperature by

direct contact or non-contact method. Direct
contact temperature measuring instruments
use thermocouples or RTDs with electronic
indicating instruments or mercury in glass
thermometers. Non-contact temperature
measuring instruments.
Pressure gauges
Analog and digital pressure gauges are used to

measure pressures of liquids and compressed
gases.
Manometers
U-tube and inclined manometers are used

for measuring low air pressures. Electronic
manometers are also used.
Ultrasonic flow
meter
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Doppler type flow meters are used for

measuring velocity of liquids in pipelines,
wherein the liquid has particulate matter
or air bubbles of more than 30 microns
size. Transit time ultrasonic flow meters
are used to measure the velocity of clear
liquids in pipelines. Flow measurement
using ultrasonic flow meters is prone to
errors and is not accepted as a standard flow
measurement method. However, it is used
in energy audits in the absence of installed
in-line flow measuring instruments. Similar
instruments for air flow measurement are
also available in the international market;
however, these are not commonly used
presently due to the prohibitively high cost
of the instrument.
Anemometer
Turbine type and thermal anemometers are

used to measure the velocity of low pressure
air.
Psychrometer
Measurement of relative humidity is measured

by measuring the dry bulb and wet bulb
temperature of air and correlating it on a
psychrometric chart. Direct relative humidity
indicating capacitance electronic instruments
are also available.
This instrument is used to identify

malfunctioning steam traps.
Steam trap tester
Ultrasonic leak detectors are electronic

instruments with analog indication used to detect
minor leaks in compressed air systems and
refrigerant gas leaks, which are normally not
audible. This instrument only detects leaks, it
cannot quantify the leakage.
Ultrasonic leak detector
Table 1.1 Energy audit instruments

Energy audits also use data from installed plant instruments wherever there are constraints in using portable
instruments; typical examples are measurement of flow of gaseous fluids, flow of liquids at high temperature etc.
Calibrated installed instrumentation is generally more accurate than portable instruments.
1.9 Cases - Energy Management Styles

Godrej and Boyce, Mumbai
This is an engineering company with many divisions and centralised energy supply and utility support services. A
senior person from the central utility service department is designated as the Energy Manager. He/She constantly
interacts with the various divisions to identify energy saving opportunities. He/She identifies areas where external
energy audits can help in identifying more opportunities.
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After completion of the energy audit, he/she follows up vigorously with the divisional heads to ensure that most of
the identified energy saving projects are implemented. No formal energy conservation cell exists, but continuous
focus on energy efficiency improvement and cost reduction is maintained through the Energy Manager. The
implemented projects are well documented and hence available for replication in other divisions. The strategy has
been reasonably successful and the company has bagged the Confederation of Industrys (CII) award for excellence
in energy conservation.
Johnson and Johnson, Mumbai
This is a pharmaceutical multi-location global company. The parent company in the USA has an energy and
environmental policy which is publicised on their website. Clear cut energy and environment norms are prescribed
for new equipment purchases and projects.
Unambiguous method for evaluation of new projects for compliance with the policy exists with a rating system. This
enables project managers to make a self assessment for compliance and credit points are earned for compliance.
Locations compete globally for the annual Energy and Environment award given to the location with the best
compliance. The Mumbai location has done commendable work and also won the award once. But continuous focus on
energy management is lacking due to the absence of a designated energy manager and energy management cell.
Reliance Industries, Hazira
This is a large, multi-plant petrochemical complex which has a well structured four tier energy management system.
An Apex Group, headed by the Executive Director, consists of representatives from the top management. The Energy
Cell is headed by a Vice President; he has four engineers working with him in the core group. Each plant in the
complex has a designated energy coordinator. The energy coordinator of each plant along with the technical service
engineer and a electrical engineer of the same plant form the Working Group of that plant. Additionally, Small
Group Activity (SGA) is a new initiative to involve shop floor people in energy conservation; the SGA participants
have been trained by CII. This focused approach has led to an implementation of large number of energy saving
projects resulting in reducing the specific energy consumption from 1.857 Mkcal/MT in 2001-02 to 1.722 Mkcal/
MT in 2003-04.
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Summary

Energy management is defined as the strategy of adjusting and optimising energy, using systems and procedures
so as to reduce energy requirements per unit of output while holding constant or reducing total costs of producing
the output from these systems.
Energy management has evolved over the years from a knee jerk reaction to the oil crises of the 1970s to an
expanded scope that integrates energy conservation, energy efficiency, cost optimisation, environment protection
and energy security.
Energy management addresses issues related to energy costs, energy efficiency, secure energy supplies, alternative
energy sources and abatement of environmental pollution.
Successful energy management calls for a well thoughtout strategy that addresses issues related to the organisation,
people, technology and finance.
As per the Energy Conservation Act, 2001, energy audit is defined as the verification, monitoring and analysis
of use of energy including submission of technical report containing recommendations for improving energy
efficiency with cost benefit analysis and an action plan to reduce energy consumption.
Thus, energy audit can be classified into three categories namely: Walk-thru Audit, Preliminary Audit, and
detailed Audit.
Walk thru energy audit involves physical observation of operation of equipments and processes to visually
identify glaring deficiencies, identify areas worthy of further study and check compliance with previously
recommended measures.
A comprehensive audit provides a detailed energy project implementation plan for a facility, since it evaluates
all major energy using systems.
Benchmarking is an effective method for ranking the energy performance. Benchmarking can be done for a
whole organisation, a production or service department, a production line or equipment.
Fuel substitution: Substituting existing fossil fuel with more efficient and less cost/less polluting fuel such as
natural gas, biogas and locally available agro-residues
The effectiveness of an energy audit depends on the identification of energy saving projects that can be practically
implemented.
References

http://bee-india.nic.in/energy_managers_auditors/documents/guide_books/1Ch3.pdf. Last accessed on 06th

January 2011.
http://www.google.co.in/images?hl=en&q=Ultrasonic%20leak%20detector&um=1&ie=UTF8&source=og&sa=N&tab=wi&biw=1229&bih=520. Last accessed on 06th January 2011.
http://www.google.co.in/images?hl=en&biw=1229&bih=520&tbs=isch%3A1&sa=1&q=steam+trap+tester&a
q=f&aqi=&aql=&oq=&gs_rfai=. Last accessed on 06th January 2011.
Recommended Reading

Kostas Metaxiotis (2009). Intelligent Information Systems and Knowledge Management for Energy: Applications
for Decision Support, Usage, and Environmental Protection. Information Science Reference; First edition.
Stephen Howard (1998). Energy Management (Chandos Series on Construction & Facilities). Chartridge Books
Oxford.
Steve Doty (2008). Commercial Energy Auditing Reference Handbook. Fairmont Press; First edition.
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Self Assessment
1. Benchmarking is an effective method for ranking the _______________.
a. energy cost
b. energy audit
c. fuel substitution
d. energy performance
2. A ___________audit provides a detailed energy project implementation plan for a facility.
a. comprehensive
b. detailed
c. preliminary
d. walk-thru
3. Which of the following instrument is used to measure low air pressure?
a. Ultrasonic detector
b. Manometer
c. Psychrometer
d. Anemometer
4. Which of the following statements is false?
a. Calibrated installed instrumentation is generally more accurate than portable instruments.
b. Flow measurement using ultrasonic flow meters is prone to errors and is not accepted as a standard flow
measurement method
c. Fuel substitution has taken place in all the major sectors of the Indian economy
d. Internal benchmarking relates to inter-unit comparison across a group of similar units
5. Turbine type and thermal anemometers are used to measure the _______of low pressure air.
a. velocity
b. temperature
c. pressure
d. humidity
6. The _________________ is usually restricted to the minimum level that is required to maintain production,
quality and safety
a. installed instrumentation
b. portable instrumentation
c. plant instrumentation
d. working instrumentation
7. Direct contact temperature measuring instruments use thermocouples or RTDs with electronic indicating
instruments or ________in glass thermometers
a. sulphur
b. sodium
c. mercury
d. potassium
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8. Which of the following instrument measures relative humidity?

a. Ultrasonic detector
b. Manometer
c. Anemometer
d. Psychrometer
9. An extension of the detailed energy audit is the so called ___________ audit.
a. Investment Grade energy
b. detailed
c. preliminary
d. walk-thru
10. What does CDM stand for?
a. Clean Drive Mechanism
b. Critical Development Mechanism
c. Clean Development Measure
d. Clean Development Mechanism
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Chapter II
Procedures and Techniques
Aim

introduce the concept of energy audit overview and scope of audit
explicate planning in energy audit
explain the role of energy auditing team
Objectives

explain the importance of control of energy use
describe energy audit activities in-depth
elucidate energy saving opportunities for energy conservation
Learning outcome
At the end of this chapter you will be able to:

understand the preparation of audit report
identify analytical techniques used for energy audit
describe the contents of energy audit report
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2.1 Introduction
An ideal way of identifying energy management opportunities in an organisation is to conduct an energy audit as
part of the process of developing an energy management strategy. An energy audit can be conducted by a trained
energy manager, with the requisite expertise or an external energy auditor. When hiring energy auditing firms, the
following information about the companies/consultants should be considered in addition to the cost and scope of
the work:

Specific references for similar projects/work
Relevant experience
General track record
Technical skills
Management skills
Methods of reporting and data gathering
Experience in evaluating energy efficiency measures
2.2 Scope of Energy Audit

The audit scope describes the extent and boundaries of the audit in terms of factors such as physical location and
organisational activities, as well as manner of reporting. The client must interact with the energy auditor and establish
the scope of the work. A pre-bid meeting with energy auditors is a good way to start.
Practical considerations in finalising the scope of the energy audit include the industrys size, the staffs capability
and availability, the energy auditors capability, money and time available. Attempts to stretch the audits scope
beyond any of these resources may compromise the quality of the audit. Audit quality should never be sacrificed in
pursuit of greater geographic scope or new subject coverage.
The allocation of resources for the energy audit should be consistent with its objectives and scope. This includes
things such as:

provision of the necessary working space for the auditor
assignment of responsible and competent guides to accompany the auditor on her/his rounds
unrestrained access to the facilities, personnel, relevant information and records as requested by the auditor
facilitation of measurements and data collection
2.3 Energy Audit Activity

It is known that the complexity of energy audit is proportional to the complexity of energy use in the facility.
Therefore, when larger and diverse plant operations are studied, the need arises to properly plan out the activities
so that the work is done effectively and within specified time period.
The work undertaken in an energy audit includes:

investigating how much electricity, gas, fuel oil, solid fuel and other forms of energy are consumed.
identifying which forms of heating and cooling are used, which equipments are used and how much energy
they consume.
identifying cost-effective measures to make energy use more efficient.
estimating the potential costs and energy savings of implementing efficiency measures.
checking on how energy use is managed and monitored.
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Start
Start up meeting with energy and production

departments, explain methodology
Data collection (energy bills,

Process flow diagram, equipment
specifications, etc)
Bill analysis, statistical analysis of

energy and production, energy index
evaluation, bench marking etc.
Preliminary walk through of plant (for

familiarisation, survey of instrumentation/
metering arrangements, planning out
measurements etc.)
Measurements, calculations, energy

desegregation, efficiency evaluation of
equipments, study of end use energy utilisation
Identification of ECOs, preparation and

discussion of preliminary report
Detailed review of approved ECOs

implemented plan
Preparation of final report, monitoring plan

Fig. 2.1 Energy audit work flow diagram
2.4 Energy Auditing Team

The composition of energy audit team will depend upon the following:

How much work is involved and how fast do the clients need energy audit to be completed?
What is the type of industry/process to be audited?
Energy auditing, is an interdisciplinary subject. Hence the auditing team should have people from different
backgrounds (qualifications or experience wise). Minimum three persons in an energy audit team are very much
desirable. This will help in on-site discussions within the team and ensure that data and measurements taken are
collected properly and systematically.
The level of responsibilities in the team should also be decided, considering the expertise of individuals. A project
manager in the auditing team can have the overall responsibilities of communication, coordination and report
preparation of the study. It is necessary for the person to be involved in the study at various phases like data collection,
measurements discussion etc. A process consultant, if needed, can give inputs to the team at various stages. The
engineers/technicians can undertake measurements and give inputs to the team during internal discussions.
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2.5 Preparing for the Audit

The process of audit is done in three stages as explained below:
2.5.1 Scheduling
Schedule the audit at the time when:

it is convenient for plant operations
conditions represent typical operational regime and conclusions drawn can reasonably be extrapolated for an
entire year.
Before undertaking an energy audit, the following preparations should be made by the energy auditor to ensure that
the work goes smoothly and that all required information is available in a timely manner:

Establish contact with the senior individual with responsibility for the audit in the facility/building to be
audited. All communication concerning the audit and recommendations from the audit should go through this
individual.
Give a facility at least one week prior notice of an audit visit in order to allow sufficient time for the facility
managers to obtain the required documentation and inform the staff of the audit. Identify in writing the documented
information that you require, such as electrical bills and plans/drawings.
Insist that a facility staff member, familiar with the facility, accompanies you during the audit rounds to provide
any explanations.
Before entering any area of a facility, always announce your presence and ask for permission.
Respect facility rules which may delay or prevent entry into some areas.
When these situations occur, try to obtain information about energy using equipment in these areas by talking to
the staff. Obtain and use any required personal protective equipment required by facilities to allow entry to certain
areas.
2.5.2 Instrumentation
During the plant study, the major task is data generation and data gathering. For this activity, instrumentation,
metering and monitoring is very essential. But not all the parameters can be measured by the portable instruments
available with the energy auditor (also all auditors may not have all the measuring and data logging instruments).
For some vital parameters, the plant may need to have online instruments for recording (manual or automatic) and
monitoring. Ensure that the instruments that you plan to use are in place and calibrated.
2.5.3 Measurements
Measurements should be made with a purpose; endless data logging of various parameters may not help in improving
the quality of the study. The following points may be noted:

Time stamp every reading that you take. While taking the reading, note down important points in your workbook
on operating status of the equipment. For example, while measuring power input to a chilling plant compressor,
note the number of cylinders loaded, discharge and suction pressures etc. While measuring airflow of a combustion
blower, note the damper position or firing rates. (high or low fire.)
Follow a systems approach while making observations. For example, while measuring performance of chilling
plants, measure ambient conditions, cooling tower water temperature, end use conditions etc. to get a clear
picture. While taking measurements on chilled water pumping to process, find out how many heat exchangers
are used in production, how many are idle, whether the idle ones are also passing chilled water etc.
Use instruments of good accuracy and precision. For measuring boiler stack gas temperatures, you may use a
temperature sensor (Thermocouple or RTD) and indicating instrument with 10C accuracy. The same instrument
can not be used for measuring temperature drop across a chiller or a cooling tower, where an instrument having
at least 0.10C accuracy is required.
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Select instruments with proper scale. While measuring pump discharge pressure of 2.0 kg/cm2, do not use a
bourdon gauge of 0 - 20 kg/cm2 scale. Use a pressure gauge of 0-7 kg/cm2 maximum. Similarly while measuring
power input of a 5 HP motor, do not use a CT of 1000/5 A rating; use a CT of 50/5 A rating.
Give time for stabilising the value to be measured. After starting the equipment, give at least 15 minutes of
operation of a chilling plant before taking measurements. Similarly, while measuring power on lighting feeders,
allow about 10 minutes time to elapse after switching on the lamps.
Always have a cross check on measurements. In case of a doubt, repeat measurements. Do some of the spot
calculations as well.
2.6 Controlling Energy Use

Some of the basic information about the plants energy billing is important to identify cost saving opportunities as
well as arriving at the prevailing unit price for energy, which can be used by the auditor while estimating energy
cost saving. Before actual analysis can begin, an understanding of the information and costs on the energy bill must
be reached. The appropriate tariff schedule is the only source for this data. State Electricity Boards (SEB) usually
provide this information on their website.
2.6.1 Questionnaire for Data Gathering
The following questionnaire can be used for gathering data on energy consumption:
1.
2.
3.
4.
Name of the Company

Product Details
Plant Capacity
Energy Bill Data (For the latest year)
Type
Annual Consumption (kW H/Yr.)
Cost ( `. /Yr.)
Purchased Power (SEB)

Generated Power
Fuel (Other than power generated)
Others (Please specify)
5. Provides copies of Electricity and Fuel Bills for last 12 months
6. Process Description: In order to relate energy use in your plant to specific operations and
equipment, and overview of the production process (please provide a materials / process flow sheet
if possible)
7. If sub-metering of energy consumption is available, provide the monthly consumption data as per
sub-metering of various sections.
8. Please use the rest of this sheet to draw any diagram, if you need to draw one.
2.6.2 Electricity Consumption
Fuel (coal, oil or gas) is delivered to the plant by trucks, pipelines etc. Electricity is supplied through Transmission
and Distribution lines. The major difference between electricity and other types of fuels is that electricity needs to
be generated at the same moment when it is required. There is no storage of electricity possible en route. Hence,
the consumer is charged for demand of electricity at a contracted kW/kVA rate as well as electricity consumed
as kWh.
Most general-service rate structures also impose financial penalties on plants that:

exceed contract demand
have a low power factor, say less than 0.9

Incentives are given for maintaining power factor above 0.95.
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2.6.3 Time-of-use Rates

Motor efficiency is a measure of the effectiveness with which a motor converts electrical energy input to mechanical
energy output to drive a load. These pricing schemes offer very low rates to customers who can shift high demand
operations away from the times of a day when the utility receives its peak demand for energy. The utility benefits
from a more consistent daily load pattern and the customer pays less.
2.6.4 Reducing Peak Demand
A facilitys peak demand is the sum of the power (kW/kVA) required to run all the electrical equipments currently
in operation. Thus, the demand peak increases and decreases as equipment is turned on and off and as the load goes
up and down. Peak demand charges are based on the highest peak occurring in the billing period, even if that peak
lasts for only one or two hours. Since demand peaks are usually predictable, they can be lowered by:

shedding loads - shutting off non-essential equipment during the peak period.
shifting loads - re-scheduling operations so that some activities take place during off-peak times.
improving processes to reduce electrical power requirements.
2.6.5 Improving the Power Factor

The power factor (PF) of an industrial facility is calculated as a ratio of monthly kWh divided by monthly kVAh.
Remember that the resistive component of the electrical power does the useful work. A low PF is normally caused
by inductive loads used by equipments such as transformers, lighting ballasts and induction motors (especially
under-loaded motors) and induction furnaces. It is in the interest of the facility to maintain a high PF so that the
capacity charge (kVA) by the utility does not exceed the established value.
2.6.6 Fuel Billing
Solid and liquid fuels are billed according to their weight. Gaseous fuels like piped natural gas is billed as per minimum
billing demand in m3/day or actual m3/day whichever is higher. This depends on the gas supply contract.
To actually achieve cost savings, we may need to reduce the contract demand. The cost of energy is to be calculated
for each fuel and converted to Rs/GJ for comparing the relative costs.
2.7 Analytical Techniques

A number of analytical techniques are used in energy management context to help the energy auditing team to arrive
at realistic results. The following discussions will familiarise you with some techniques.
2.7.1 Incremental Cost Concept
The electricity billing generally appears in two parts. One for the demand of electricity (kVA or kW) and the other
for energy consumed (kWh). In addition to this, a lot of other cost components like time of use charges, power factor
penalty/rebate etc also are applicable. If an energy saving measure results in only energy saving (and no demand
saving), one needs to consider energy cost alone, excluding demand charges.
In case of a plant having a cogeneration system and drawing power from grid as well, this calculation becomes
slightly involved. For example, in a paper mill, energy audit has shown that there is a potential of saving 200 kW
by modifications in the pumping systems. The plant has a power plant with a coal fired boiler and a back pressure
turbine. The average cost of electricity generation is Rs 1.0/kWh. The following calculations can be done..
Annual operating time = 8000 hours
Annual energy saving = 200 X 8000
= 16,00,000 kWh per year.
Now, it would be correct to state that the energy cost saving is ` 1.0 X 16, 00,000 = ` 16.0 lakhs per year. Looking
closely at the given system operation, we may also find that in some plants, due to the process requirement of steam
remaining the same, when we reduce generated power by 200 kW, some amount of steam needs to be vented out.
If this is so, our saving may reduce to the extent of loss of steam and its cost.
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On the other side of it, consider a grid connected system, where we have identified 200 kW saving by replacement of
Chilling plant with a new efficient plant. While evaluating potential energy saving opportunities, we should note that
chillers run the most when the weather is very hot and/or when the plant is running at its highest capacity. Chillers
contribute greatly to the monthly demand charge on the electric bill. As a result, using an average Rs/kWh figure
to estimate operating costs yields inaccurate results. Estimating the savings available through chiller conservation
measures requires that we evaluate the effects on energy charges and peak demand charges separately.
Hence, make sure that the energy cost calculations include all the possible variables. The cost saving should be the
difference in overall energy cost baseline and the total energy cost after the implementation of measures. This is
the basis of incremental cost concept.
2.7.2 Inventory of Energy Inputs and Rejections
An inventory of energy inputs and rejections is helpful in identifying the energy mix of the plant and thus realistic
costing. This will also help in optimising the energy flow through the system to reduce energy costs.
The possible energy inputs to a plant or subsystem are:

Electricity: For driving motors, heating, electrolytic processes, lighting etc.
Fuel: For steam generation (process heating, vacuum, power generation), direct firing etc.
The energy rejections in a plant are:

Stack losses from boiler, fuel fired heaters etc.
Heat dissipated in cooling tower, cooling air etc.
Heat loss from equipments like motors, furnaces etc.
Energy input and energy rejected need not be equal. Some amount of chemical energy change may take place when
raw materials are converted into products. For example, in Aluminium refining, most of the energy input that goes
for electrolysis of Alumina gets stored in the final product aluminium.
2.7.3 Heat Transfer Calculations
In industrial processes, there are mainly three types of energy involved.

Sensible Heat (e.g. heating water)
Latent Heat (e.g. condensing vapours)
Heat of Reaction (e.g. combustion)
The relationship for estimating heat involved in these systems is given below:
Sensible heat
For heating water, the equation would be:
Q = mx cp x(T1 T2)(1)
Where,
Q = Heat transferred per unit time (W)
m = Mass or Mass Flow rate of fluid (hot stream or Cold stream), kg or kg/s
cp = Specific heat capacity, kJ/kg 0C
T1= Fluid outlet temperature, 0C
T2= Fluid inlet temperature, 0C
Latent heat
For condensing vapours/boiling liquids, the heat transfer equation would be:
Q = m L
Where, L = latent heat of vapourisation, kJ/kg
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Heat of reaction
The Heat of reaction or Enthalpy of Formation of a substance is the energy required to form a substance from its
elements at 298K and 1 atmosphere.
These values are negative when heat is given out when the substance is formed and positive when heat is to be
supplied to form substance. The following relationship can be used.
(Sum of heats of formation of reactants) + (Heat of reaction) = (Sum of heats of formation of products)
The above relationships can be used to estimate heat flow in processes.
2.7.4 Evaluation of Electric Load Characteristics
A load curve as shown in fig. 2.2 describes the relationship between time and power demand for a particular facility.
This is a 24 hour period recording of electrical demand for 30 minute intervals.
Electrical Demand Profile
2000
Peak Load= 1850 kVA
1800
1600
Demand, kVA
1400
1200
Average load = 1015 kVA
1000
800
600
400
200
:0
23
:0
22
:0
21
:0
20
:0
19
:0
18
:0
17
:0
16
:0
15
:0
14
:0
:0
13
12
00
11
:
:0
10
:0
09
:0
08
:0
07
:0
06
:0
05
:0
04
:0
03
:0
:0
02
01
00
:0
0
Time
Fig. 2.2 Electrical demand profile

Amongst other insights, a load demand profile is a tool for identifying instances where just a few culprit hours are
associated with high demand. Note that the peak demand is 1850 kVA; whereas the average load is 1015 kVA only.
There may be some options to reduce the peak demand.
It is important to understand how electrical demand is recorded by Electricity Utilities (SEBs). The demand is the
30 minutes average of kVAh (apparent energy) consumption. The maximum demand for a billing cycle for, say a
month, is the maximum value of such 30 minutes averages in a month. This means that the maximum value among
the 1440 half-hour readings of the demand meter in a month will be considered. It is clear that even if the maximum
demand has occurred only once in the month, the demand charges would be based on that maximum value.
A demand profile is hence an essential tool to understand variations in demand to help identify opportunities to
reduce demand and hence an integral part of the energy audit study.
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Electric motors
The power consumed by a 3-phase AC motor is given by:
Power input = 3 x line voltage x line current x power factor
If the voltage is in volts and the current in amperes, the power will be in watts (W). The power in watts divided by
1000 is Kilowatts (kW). The power input to the motor varies with the output shaft load.
Motor efficiency is a measure of the effectiveness with which a motor converts electrical energy input to mechanical
energy output to drive a load. It is defined as a ratio of motor mechanical power output to source electrical power
input. The difference between the power input and power output comprises electrical and mechanical losses. Small
fractional horsepower motors tend to have low operating efficiencies, while larger integral horsepower motors
generally have higher efficiencies.
At a particular operating voltage and shaft load, the motor efficiency is fixed by design; it cannot be changed
externally, while power factor can be corrected externally.
Typical variations of motor efficiency and power factor with load are shown in fig. 2.3.
90%
87%
0.84
Power factor
Efficiency
0.70
50%
100%
Motor shaft power,%
Fig. 2.3 Motor efficiency and power factor

Following may be noted from these curves.

The motor efficiency remains almost constant up to 40% load, below which the efficiency drops significantly
and becomes zero at 0% load.
For a particular operating voltage and shaft load, the motor efficiency is determined by design, it cannot be
changed externally.
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The power factor reduces with load. At no load the P.F. is in the range of 0.05 to 0.2 depending on size of the
motors.
Note that at 50% load, the efficiency has dropped by 3%, whereas the power factor has dropped from 0.84 to
0.7 for the same load change.
At no load, the power consumption is only about 1 to 5%; just sufficient to supply the iron, friction and windage
losses.
The no load current is however, of the order of 30 to 50% of the full load current. This high magnetising current
is required because of air gap between the stator and the rotor of the motor.
2.8 Evaluation of Saving Opportunities

Some of the typical energy saving opportunities in common energy consuming systems are discussed below. This
will help in focusing on energy conservation opportunities during the energy audit.

Lighting
use natural day lighting
reduce lighting levels where appropriate
reduce overall lighting and install task lighting
use voltage controllers on lighting feeders
install incandescent lights
use electromagnetic ballast
install mercury vapour lamps
install led panel indicator lamps in place of filament lamps
Electric motors
If the motor operates at 40% of its rated load or less, it is a strong candidate for downsizing.
There are two methods to optimise loading of a running motor, namely, connecting motors in STAR form
and Use of Soft starter with energy saving features.
Pumps and Fans

optimise the use of water
install pumps and fans of correct size
do not throttle pumps and fans in order to control the flow rate
replace throttle control on fan discharge with inlet vane control
bypass control should not be utilised to vary the flow out of the pump
optimise pipeline sizes
do the periodic maintenance
Cooling Towers
install solid state vsd control on the cooling tower fans
replace the tower fill material with cellular film to improve the heat transfer efficiency
install non-clogging, non-corroding spray nozzles to improve water distribution through the tower
install energy efficient airfoil fan.
Compressed air
reduce use of compressed air
reduce pressure loss
reduce air leakage
select appropriate compressors and capacity control
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Boiler and steam systems

Tune the boiler (reduce excess combustion air)
Clean the boiler to remover waterside and fireside fouling
set the blow-down based upon the amount of total dissolved solids
use ultrasonic tools to identify traps that are malfunctioning
install properly designed steam traps to reduce the amount of steam lost through the open system
install a condensate return loop
Refrigeration and air conditioning system

reduce the need for refrigeration
increase temperature settings
reduce heat ingress
use the best applicable heat exchanger design and do periodic maintenance
employ best monitoring and control techniques
employ new developments for relative humidity control
Inter-fuel substitution: Use absorption chillers
2.9 The Plant Energy Study Report

Energy audits do not save money and energy for companies unless the recommendations are implemented. The goal
in writing an audit report should not be the report itself; rather, it should be to achieve implementation of the report
recommendations and thus achieve increased energy efficiency and energy cost savings for the facility.
The following should be considered in energy audit report:

Effective organisation
present information visually
use commonly understood units
make your recommendations clear
explain your assumptions
Contents of energy audit report

Executive summary
Introduction of manufacturing process/service
Analysis of energy consumption and production
Energy audit recommendations
Energy financing options
Maintenance recommendations
Appendix
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Summary

An ideal way of identifying energy management opportunities in an organisation is to conduct an energy audit
as part of the process of developing an energy management strategy.
The allocation of resources to the energy audit should be consistent with its objectives and scope.
The process of audit is done in three stages namely: scheduling, instrumentation and measurement.
Some of the basic information about the plants energy billing is important to identify cost saving opportunities
as well as arriving at the prevailing unit price for energy, which can be used by an auditor while estimating
energy cost saving.
A number of analytical techniques are used in energy management context to help the energy auditing team to
arrive at realistic results like: incremental cost concept, inventory of energy inputs and rejections, heat transfer
calculations, evaluation of electric load characteristics.
Some of the typical energy saving opportunities in common energy consuming systems are - lighting, electric
motors, pumps and fans, cooling towers, compressed air, boiler and steam systems, refrigeration & air conditioning
system.
Energy audits do not save money and energy for companies unless the recommendations are implemented. The
goal in writing an audit report should not be the report itself; rather, it should be to achieve implementation of the
report recommendations and thus achieve increased energy efficiency and energy cost savings for the facility.
References

http://www.dougherty.k12.ga.us/dpms/PDFs/EGY/EGY-P001_energyaudit.pdf. Last assesses on 17th January

2011.
http://www.powermin.nic.in/distribution/energy_audit.htm. . Last assesses on 17th January 201.
http://www.energyauditdirectory.com/articles/article-2.html. Last assesses on 17th January 2011.
Recommended Reading

Albert Thumann (2010). Handbook of Energy Audits. Fairmont Pr; Eighth edition.
Steve Doty (2008). Commercial Energy Auditing Reference Handbook. Fairmont Press; first edition.
Shirley J. Hansen (2004). Investment Grade Energy Audit: Making Smart Energy Choices. Fairmont Press.
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Self Assessment
1. The best time to conduct energy audit of a plant is ____________.
a. when the plant is operating at normal/full capacity.
b. when the plant is under shut down.
c. when the plant production is 60% of the normal production.
d. any time is good.
2. Most SEBs electricity rate structures impose financial penalties on plants for ________.
a. exceeding 100% contract demand.
b. having a low power factor less than 0.9.
c. night time use of electricity.
d. late payment of charges.
3. The major difference between electricity and other types of fuels is that, ________.
a. electricity needs to be generated at any moment when it is required.
b. electricity needs to be generated at the same moment when it is required.
c. electricity can be kept in reserve.
d. electricity needs to be generated after it is required.
4. A 50 HP rated motor is operating at 50% load. Full load and half load efficiencies are 91% and 89% respectively.
It is decided to replace this motor with a 25 HP motor of full load efficiency 89%. What is the likely power
saving?
a. Zero
b. 25 HP
c. 2%
d. 9%
5. A plant has a contract demand of 2000 kVA and a minimum billing demand of 80% of contract demand. The
average plant load is 1200 kW and actual maximum demand is 1700 kVA. Demand charges are Rs 200 per
first 1000 kVA and Rs 300 per kVA for demand between 1000 and 2000 kVA. The most likely demand charge
(excluding taxes, duty etc) is:
a. ` 5.0 lakhs
b. ` 2.6 lakhs
c. ` 2.9 lakhs
d. ` 4.1 lakhs
6. Complexity of energy audit is proportional to the complexity of ________in the facility.
a. energy demand
b. energy supply
c. energy use
d. energy consumption
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7. Which of the following statement is false?

a. Motor efficiency is a measure of the effectiveness with which a motor converts electrical energy input to
mechanical energy output to drive a load.
b. The cost saving should be the difference in overall energy cost baseline and the total energy cost after the
implementation of measures.
c. A high PF is normally caused by inductive loads used by equipment such as transformers, lighting ballasts
and induction motors.
d. Solid and liquid fuels are billed according to their weight.
8. The power factor (PF) of an industrial facility is calculated as a ratio of monthly kWh divided by monthly
______.
a. kPFh
b. kTAh
c. kIFh
d. kVAh
9. Motor efficiency is a measure of the effectiveness with which a motor converts electrical energy input to
_______energy output to drive a load.
a. kinetic
b. thermal
c. mechanical
d. heat
10. (Sum of heats of formation of reactants) + ____________ = (Sum of heats of formation of products).
a. (Heat of reaction)
b. (Heat of components)
c. (Heat of atmosphere)
d. (Heat of energy)
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Chapter III
Energy Balance
Aim

explain the concept of energy balance
explicate the concept of mass balance
explain the concept of energy balance sheet
Objectives

explain the methods of preparing an energy flow diagram
describe in-depth, quantifying energy flows
explain the significance of energy balance sheet
Learning outcome

describe at length, facility as an energy system
understand first and second law efficiencies
understand energy balance diagrams for typical facilities
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3.1 Introduction
"Most of the raw materials arrive at room temperature and most of the finished products leave at room temperature.
One may wonder where all the energy supplied for heating, cooling and processing went! - Dr. M.G. Gharpure
The objective of an energy audit is to identify energy losses and to reduce or eliminate these losses through operational
changes, retrofits or alternatives. This calls for a systematic method of analysing facilities and processes. In the absence
of a systematic methodology, there is the danger of not achieving the full potential of energy conservation, or, in
some cases, unknowingly increasing the consumption of some energy utilities at the expense of others. This happens
because energy is consumed not only in the form of fuels and electricity, but also as energy intensive secondary forms
like compressed air, nitrogen gas etc. Hence a holistic approach, as opposed to a piecemeal approach, is desirable
to ensure that the measures implemented actually lead to significant energy savings and reduction of energy costs.
3.2 Facility as an Energy System

Energy enters the facility both through fuels, electricity and materials. While fuels and electricity can be easily
observed, the chemical energy carried by the raw materials themselves is some times missed. The chemical energy
content of materials being processed can be ignored if it does not undergo a major change during processing.
However, in case the processing leads to exothermic or endothermic reactions, energy content of the material needs
to be understood as part of the energy flow through a facility or process.
Energy and material balances or input-output quantification of energy and material flows are invaluable tools for
exploring available avenues for energy conservation. Useful energy and finished material yields are highlighted in
energy and material balances, thus helping identify waste energy and rejected/ recycled material streams.
Every production facility comprises a number of processes. Ideally, energy balances have to be developed at the
macro level for a facility as a whole and also for the individual processes that go to make up the facility. Practically,
energy audits are not rigorous academic exercises and are expected to generate quick results that are economically
attractive. Hence energy balance calculations may be restricted to certain promising areas as defined by the scope
of the work.
3.2.1 First Law and Second Law Efficiencies
Energy efficiency refers to the relationship between the output (service) of a device or a system and the energy
put into it. Improved energy efficiency is doing more with equal or less energy input, for instance, fewer kilowatts
per ton of aluminium produced.
Energy efficiency can be evaluated in terms of both first law efficiency and second law efficiency.

First law efficiency relates to the ratio of energy output to energy input of a device. Many modern devices have
low first law efficiencies, indicating substantial room for improvement. The first law efficiency is the energy
index at actual operating condition.
Second law efficiency relates to the ratio of the minimum amount of work or energy required performing a
task to the amount actually used. This reduction in the energy consumption is not necessarily associated with
technical changes, since it can also result, for instance, from better organisation and management. The second
law efficiency is the ratio of theoretical equipment performance and the actual performance.
The concept of second law is described in fig. 3.1 which is given below:
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Variability reduction
E n erg y In d e x, k W h / Ton
System operation improvements

reduction
Equipment
improvements
Target
value
Theoretical equipment performance
Time
Fig. 3.1 Equipment and system performance
3.3 Energy and Mass Balance

The rules of energy accounting say that all the energy that enters a facility must leave it in some form or the other.
What is normally understood as energy consumption or energy use is actually conversion of energy from one form
to another, e.g. Chemical energy in fuels converted to high temperature heat energy.
Energy Balance is a systematic presentation of energy flows and transformations in a system.
A Mass Balance (also called as Material Balance) is an application of conservation of mass to the analysis of
physical systems.
Purchased energy crosses the energy system boundary as energy inflows. During processing, this energy is converted
to energy which may be stored in the material as chemical energy or dissipated as waste heat; this is called energy
outflow. An energy flow diagram shows the facility or process or equipment boundary and the energy inflow, energy
flows within the facility boundary and the energy outflow. The magnitude of the energy inflow should match the
energy outflow in a defined time period. Such mapping of energy flow can be done for a large system and also for
sub-systems that make up the larger system.
The typical components of an energy flow diagram are given below:
Flue gas and Radiation loss
Flue
Facility energy system boundary
Boiler Plant
Subsystem
Steam flow
Process and
Equipment
Subsystem
Electricity
Fig. 3.2 Energy flow diagram

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Process and
Equipment
Subsystem
Air flow
Process and
Equipment
Subsystem
Fluid flow
3.4 Method for Preparing an Energy Flow Diagram

The steps involved in preparing energy flow diagram are described below through an example of a textile processing
plant.
Step 1 Define the facilitys energy system boundary
Identify the points where energy enters the system and the points where it exits the system to define the system
boundary. In most cases, the building housing the processes and equipments is the natural boundary. In some cases,
the boundary may extend beyond the building if some of the processes are completed outside the building. For the
textile plant given in this example, the system boundary is the system of equipments and processing viz. boilers,
desizing, bleaching and dyeing.
Step 2 Identify external energy sources
Identify and list all the external sources of energy that are used in the system. Please note that this will also include
chemical energy stored in the raw material which may release through exothermic process reactions.
The external energy and material sources in the textile processing plant are:

Furnace oil as fuel for boiler
Electricity for machines
Chemicals for processing
Step 3 Identify sub-systems

Identify the sub-systems (processes and energy transforming equipments). The sub-system will generally include
a major equipment/process and its associated equipment.
Subsystem
Comments
Boiler
Oil fired boiler for steam generation
Desizing
Grey Fabric, water and steam is used in this process
Bleaching
Desized fabric, water, l.p. steam, h.p. steam and chemicals are used
Dyeing
Bleached fabric, l.p. steam, softwater, dye and chemicals are used
Table 3.1 Sub-systems
Step 4 Identify sub-system material and energy flows

Identify and list the inflows of material and energy to each sub-system. Also identify the source of each inflow (e.g.
fuel and electricity).
Subsystem
Inflow
Source
Boiler
Furnace Oil
Electricity for fans, pumps etc.
Water
Condensate water
Air
External
External
External
From Bleaching
External
Desizing
Steam
Chemicals
Fabric
Water
Boiler
External
External
External
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Bleaching
Desized fabric
Water
Steam
Desizing
External
From Boiler
Dyeing
Bleached fabric
Water
Steam
Chemicals
Bleaching
External
Boiler
External
Table 3.2 Energy inflows to sub-systems

Step 5 Identify sub-system material and energy out flows
Identify and list the balancing outflows for each sub-system. Include in this list an indication of whether the outflow
is to another sub-system or to the external environment.
Subsystem
Outflow
Destination
Comments
Steam
Main processing equipments
Blow down
Flue gases
Desizing, bleaching,
dyeing
External
External
Desizing
Desized fabric
Drain
Bleaching
External
To Bleaching
To surroundings
Bleaching
Bleached fabric
Waste water
Vapours
Condensate
Bleaching losses
Dyeing
External
External
Boiler
External
To Dyeing
To surroundings
To atmosphere
Feed water to boiler
To surroundings
Dyeing
Dyed fabric
Waste Water
Vapour
Finishing
External
External
Boiler
To Drains
To atmosphere
Final product is packed

To Drain
To atmosphere
Table 3.3 Energy outflow from sub-systems
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Finally, the energy and material flow diagram can be made based on the above data. The sample diagram is shown
below for the textile processing plant.
Fabric
Flue Gases
Facility Boundary
Furnace Oil
Steam Boiler
Steam
Air
Electricity
Desizing
Liquid Waste
Desized
Fabric
Bleaching
Water
Bleached
Fabric
Condensate
Bleaching
liquid losses
Waste water
Dyeing
Blow down
Vapour losses
Vapour losses
Final Product
Fig. 3.3 Energy and mass flow diagram for textile processing
3.5 Quantifying Energy Flows

Missing from the energy and mass flow diagram given above are the amounts of energy associated with each flow
- most importantly with each external flow. The best method of finding energy saving opportunities is to consider
reduction or re-use of these energy outflows. The energy outflows in the above diagram are mainly blow down
losses, flue gas losses and waste water flows.
3.5.1 Energy Balance Sheet
The following table shows the energy inflow and outflow calculations given in the above example of textile processing
plant. The energy and mass balance calculations are done as per the formulas of latent heat, sensible heat and heat
of reaction.
Take reference temperature as 250C (2980K). Estimate of energy associated with each material and energy flow
streams are calculated below:
Assumptions:

GCV of Furnace Oil = 43.368 MJ/kg
1 kWh = 3.6 MJ
Enthalpy of steam at 8 bar (g) = 2770 kJ/kg
Enthalpy of blow down water at 8 bar (g) = 740.7 kJ/kg
Enthalpy of water at 25 C = 104.7 kJ/kg
Specific heat of flue gases = 1.1 kJ/kg-0C
Specific heat of grey fabric = 0.9 kJ/kg-0C
Specific heat of desized fabric = 2.3 kJ/kg-0C
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Subsystem
Inflow
Quantity
Energy calculations
Boiler
Furnace Oil at 25C

Blower
Pump
Condensate at 95C
Air at 25C
Water at 25C
1000 kg
100 kWh
65 kWh
5000 kg
10650 kg
9000 kg
1000 43.368
100 3.6
65 3.6
5000 4.18 (95-25)
10650 1 (25-25)
9000 4.18 (25-25)
Total
Mass = 25650 kg
Energy = 45.32 GJ
14000 kg
100 kg
11650 kg
3% of input
14500 (2770-104.7)
1000 (740.7-104.7)
12650 1.1 (230-25)
1000 43.368 3/100
Sub-total of measured
energy outflow
45.32 - 44.376
=43.368 GJ
=0.36 GJ
=0.129 GJ
=1.463 GJ
=0
=0
Outflow
Steam at 8 bar.g
Blow down at 175C
Flue gases at 230C
Radiation losses
Unaccounted losses
Mass = 25650 kg
=38.64 GJ
=0.636 GJ
=3.8 GJ
=1.3 GJ
=44.376 GJ
=0.94 GJ
Energy = 45.32 GJ
Table 3.4 Energy and mass balance calculations

Note: We have considered the energy input from electricity consuming equipments also. Power consumed by the
equipment may not entirely reflect in temperature rise of any of the outflows. The unaccounted losses are mainly
due to this reason.
Now we move on to prepare energy and mass balance diagram for desizing and bleaching processes.
Energy content in Chemicals = 15.675 MJ/kg
Subsystem
Inflow
Quantity
Energy calculations
Desizing
Grey fabric at 25C

Steam at 8 bar (g)
Water at 25C
Chemicals
500 kg
50 kg
445 kg
5 kg
500 0.9 (25-25)

50 (2770-104.7)
445 4.18 (25-25)
5 15.675
Total
Mass = 1000 kg
Energy = 0.211 GJ
920 kg
50 kg
30 kg
920 2.3 (80-25)

50 4.18 (80-25)
30 (2642-104.7)
Sub-total
0.211-0.203
Mass = 1000 kg
Energy = 0.211 GJ
=0
=0.133 GJ
=0
=0.078 GJ
Outflow
Desized fabric at 80C
Drain water at 80C
Vapour losses
Unaccounted losses
Table 3.5 Desizing process-energy and mass balance
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=0.116 GJ
=0.011 GJ
=0.076 GJ
=0.203 GJ
=0.008 GJ
Subsystem
Inflow
Quantity
Energy calculations
Bleaching
Desized fabric at 80C

Water at 25C
Steam at 8 bar (g)
Chemicals
920 kg
24000 kg
5800 kg
negligible
920 2.3 (80-25)

=0.116 GJ
24000 4.18 (25-25) =0
5800 (2770-104.7)
=15.458 GJ
=0
Total
Mass = 30720 kg
Energy = 15.574 GJ
900 kg
23650 kg
5800 kg
370 kg
900 2.3 (90-25)

23650 4.18 (90-25)
5800 (418.8- 104.7)
370 (2642-104.7)
=0.134 GJ
=6.426 GJ
=1.82 GJ
=0.938 GJ
Sub-total of measured
energy outflow
15.574 9.318
=9.318 GJ
=6.256 GJ
Outflow
Bleached fabric at 90C
Drain water at 90C
Condensate at 100C
Vapour losses
Unaccounted losses
(Bleaching losses)
Mass = 30720 kg
Energy = 15.574 GJ
Table 3.6 Bleaching process- energy and mass balance

The above tables highlight opportunities of recovery of waste heat outflows. Significant heat losses in drain water
of bleaching process (6.426 GJ at 900C) from which some heat can be recovered to preheat water which is entering
the bleaching system.
Also, it is important to note that energy content alone is not sufficient to cause heat transfer. Energy available at that
temperature is the driving force of energy flow in thermal systems.
3.6 Energy Balance Diagrams for Typical Facilities

Energy balance diagrams for some of the core industries like cement, paper, aluminium etc. are discussed below.
3.6.1 Thermal Power Plant
Consider the following energy balance diagram of a typical coal-fired power station.
The largest loss (48 or 48% of the input energy) is the energy rejected to the environment by the condenser cooling
system. It may seem that reducing this loss would improve the plants energy efficiency, but, for thermodynamic
reasons, most of it is unavoidable.
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Energy
loss from
Stack =
10.2 GJ
Input-Energy in
Coal to Boiler=
100GJ
Flue Gas
Dust
Removal
Dust
Energy Loss from

Hot Surfaces=
1GJ
Energy Loss from

Blowdown and
Leaks = 0.8 GJ
Boiler
Energy Loss from

Cooling Tower=
48.3GJ
Ash
Energy Loss from Unburnt Carbon in Ash and Dust = 0.7 GJ

Energy in Steam to
Turbine = 87.3 GJ
Steam Turbine
Output-Electricity
to System = 36.3GJ
Cooling Water
Condenser
Electricity Used by
Auxillaries = 2.0 GJ
Cooling Tower
Condensate Returned
to Boiler
Fig. 3.4 Energy balance diagram coal fired power plant

3.6.2 Paper Industry
In Paper industry, about 30% of the production cost is for energy. The energy and material flow diagram of paper
industry in an integrated paper mill is shown below:
Fresh water
26.15 kg/kg
Raw
Materials
Water in
Raw Materials
0.25 kg/kg pulp
Electrical energy
1.5 kWh/kg
Air
20 kg/kg pulp
Steam
1.5 kWh/kg
Product
Pulping
Process
Paper
Machine;
Wet end
Paper
Machine;
Dry end
Water in
Product
Emitted air
Waste water
15 kg/kg pulp
25 kg/kg pulp
Water from vacuum system
Evaporated water
Reject water
0.10 kg/kg pulp
1.2 kg/kg pulp
0.05 kg/kg pulp
Fig. 3.5 Energy and material flow diagram of paper industry

The first section of the machine is called the Wet End. This is where the diluted stock first comes into contact with
the paper machine. It is poured onto the machine by the flow box, which is a collecting box for the dilute paper
stock. A narrow aperture running across the width of the box allows the stock to flow onto the wire with the fibres
distributed evenly over the whole width of the paper machine.
Press section consists of a number of heavy rollers. The paper is conveyed through these rollers on thick felts of
synthetic fibre. More moisture is squeezed out of the paper like a mangle, and drawn away by suction. At this stage
of the process the paper is still very moist.
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In drying section, the paper passes through a large number of steam-heated drying cylinders. The sheet enters the
dryer with a moisture content of 60 75% depending upon the product and the effectiveness of the presses. The
paper leaving the dryer has a moisture content of 210%, but typically has a final moisture content of between
57%. Paper mill steam consumption with cylinder drying is about 4GJ/tonne of product. The ratio of energy use
between the dryer and press sections is typically 15:1.
Expected specific energy consumption for an efficient, waste paper based paper plants (for writing and printing
paper) is given below.
Index
Best Performance
Typical Performance
Paper machine-specific electricity consumption, kWh/Ton
430
470 to 510
Total plant- Specific electricity consumption, kWh/Ton
700
900 to 1000
Specific steam consumption, Tons of steam/ Ton of paper
2.8
3 to 3.5
Table 3.7 Energy index of paper mills
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Summary

The objective of an energy audit is to identify energy losses, reduce or eliminate these losses through operational
changes, retrofits or alternatives.
Energy enters the facility both through fuels, electricity and materials. While fuels and electricity are easily
observed, the chemical energy carried by the raw materials themselves is some times missed.
First law efficiency relates to the ratio of energy output to energy input of a device. Many modern devices have
low first law efficiencies, indicating substantial room for improvement. The first law efficiency is the energy
index at actual operating condition.
Second law efficiency states that the ratio of the minimum amount of work or energy required for performing
a task to the amount actually used.
Energy balance is a systematic presentation of energy flows and transformations in a system.
A mass balance (also called a material balance) is an application of conservation of mass to the analysis of
physical systems.
The best method of finding energy saving opportunities is to consider reduction or re-use of these energy
outflows.
References

http://dictionary.babylon.com/mass_balance/. Last assessed on 11th January 2011
http://www.kids.esdb.bg/basic_principles.html. Last assessed on 11th January 2011
http://www.scribd.com/doc/43559513/1-4-Material-and-Energy-Balance. Last assessed on 11th January 2011
Recommended Reading

G. V. Reklaitis (1983). Introduction to Material and Energy Balances. Wiley; first edition
Icon Group International (2010). Energy Balance: Websters Timeline History, 1950 2007. ICON Group
International, Inc.
Colin Oloman (2009). Material and Energy Balances for Engineers and Environmentalists (Advances in
Chemical and Process Engineering). Imperial College Press
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Self Assessment
1. Which one of the following accounts for biggest losses from a steam turbine power plant?
a. Radiation losses
b. Heat rejected in cooling tower
c. Energy loss in the stack
d. Blow down loss in the boiler
2. Which of the following set of energy streams are inflows to a boiler?
a. Water, fuel, air, flue gas
b. Water, condensate, air, fuel
c. Water, condensate, blow down, fuel
d. Flue gas, blow down water, steam
3. 100 kg of water is stored in a tank at 500C. What is the energy content of water with respect to a reference
temperature of 250C.?
a. 104.5 MJ
b. 10.45 MJ
c. 10.45 GJ
d. 100 GJ
4. 1000 kg/hr of hot water flow at 950C is available for heating 500 kg of fluid from 250C to 600C. Assuming
specific heat of water to be 4.18 kJ/ kg-C and that of fluid to be heated is 2.1 kJ/kg-0C, what is the final
temperature of water?
a. 880C
b. 950C
c. 600C
d. 86.20C
5. A _____balance is an application of conservation of mass to the analysis of physical systems
a. energy
b. volume
c. mass
d. heat
6. The best method of finding energy saving opportunities is to consider reduction or re-use of these energy
_______.
a. inflows
b. release
c. outflows
d. consumption
7. Power consumed by the equipment may not entirely reflect in ____________rise of any of the outflows
a. work
b. temperature
c. heat
d. energy
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8. The magnitude of the energy inflow should match the energy outflow in a defined _______period.
a. work
b. energy
c. release
d. time
9. Which of the following is the systematic presentation of energy flows and transformations in a system?
a. Energy cost
b. Energy balance
c. Energy audit
d. Energy release
10. The first law of efficiency is the energy index at ________operating condition.
a. present
b. actual
c. available
d. future
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Chapter IV
Energy Monitoring, Targeting, Review and Evaluation
Aim

explain concept of energy monitoring and targeting
highlight the concept of cusum
explain data monitoring in-depth
Objectives
The objectives of this chapter are:

describe the elements of the energy monitoring and targeting systems
explain the rationale for monitoring, targeting and reporting
explicate data and information analysis
Learning outcome

describe various aspects of data monitoring - data collection, data analysis, regression analysis
understand the importance of target values preliminary targets and elevated targets
understand the significance of reporting
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4.1 Introduction to Energy Monitoring and Targeting

Energy monitoring and targeting is primarily a management technique that uses energy information as a basis to
eliminate waste, reduce and control current level of energy use and improve the existing operating procedures. It
builds on the principle you cant manage what you dont measure. It essentially combines the principles of energy
use and statistics.
Monitoring is essentially aimed at establishing the existing pattern of energy consumption. Energy monitoring
implies regular collection of data for:

establishing the energy baseline
understanding the variations from the baseline
establishing realistic energy saving targets
measuring and verification of implemented energy saving projects
Targeting is the identification of energy consumption level which is desirable as a management goal to work towards
energy conservation; it is the logical consequence of monitoring and implies setting achievable targets for reduction
of specific energy consumption based on the following information.

Variances from the defined energy baseline
Expected energy savings from approved energy saving projects
The primary objective of monitoring and targeting in energy management is to identify energy saving opportunities
and maintain surveillance on energy consumption with respect to the energy baseline and planned energy saving
targets.
However, several secondary benefits can be derived from the energy monitoring system by careful examination and
analysis of data. Some of the likely secondary benefits are:

improved energy budgeting
improved productivity of energy and other utilities
improved preventive maintenance
reduced wastage of materials
improved quality
4.1.1 Elements of the Energy Monitoring and Targeting Systems

The essential elements of M&T system are:

Recording -Measuring and recording energy consumption.
Analysing -Correlating energy consumption to a measured output, such as production quantity.
Comparing -Comparing energy consumption to an appropriate standard or benchmark.
Setting targets -Setting targets to reduce or control energy consumption.
Monitoring -Comparing energy consumption to the set target on a regular basis.
Reporting -Reporting the results including any variances from the targets which have been set.
Controlling -Implementing management measures to correct any variances, which may have occurred.
Particularly M&T system will involve the following:

checking the accuracy of energy invoices
allocating energy costs to specific departments. (energy accounting centres)
determining energy performance/efficiency
recording energy use, so that projects intended to improve energy efficiency can be checked
highlighting performance problems in equipment or systems
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4.1.2 A Rationale for Monitoring, Targeting and Reporting

The energy used by any business varies with production processes, volumes and input. Determining the relationship
of energy use to key performance indicators will allow you to determine:

Whether your current energy is better or worse than before
Trends in energy consumption that reflects seasonal, weekly, and other operational parameters
How much your future energy use is likely to vary if you change aspects of your business
Specific areas of wasted energy
Comparison with other business with similar characteristics - This benchmarking process will provide valuable
indications of effectiveness of your operations as well as energy use
How much your business has reacted to changes in the past
How to develop performance targets for an energy management program
Information related to energy use may be obtained from following sources:

plant level information can be derived from financial accounting systems-utilities cost centre
plant department level information can be found in comparative energy consumption data for a group of similar
facilities, service entrance meter readings etc.
system level (for example, boiler plant) performance data can be determined from sub-metering data
equipment level information can be obtained from nameplate data, run-time and schedule information, submetered data on specific energy consuming equipment
The important point to be made here is that all of these data are useful and can be processed to yield information
about facility performance.
4.2 Data and Information Analysis

Data collection without clear objectives can lead to collection of voluminous, often useless, data that is confusing
and difficult to analyse. It is desirable that some preliminary cause-effect understanding of processes and equipments
is developed before finalising data collection formats. Data formats should have facility for recording both factual
and subjective information; it helps in better understanding and appreciation of factual data.
The collected factual data should be in a form that can be easily analysed to provide outputs that have direct
relevance to the efficiency of the facility, process or equipment and/or its energy costs. The process or equipment
models used for analysis may be simple or complex depending on the scope and detail expected in the exercise.
The information generated by the study and analyses should be useful for identifying energy saving opportunities
or ascertaining whether the energy saving targets are being met.
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Data
Action
Information
Reporting
Fig. 4.1 Data-analysis-information-action

The information may be of the following types:

Study information: It is the output of a specific study like an energy audit or financial appraisal of an investment.
The extent of detailing and accuracy of this information would depend on the depth and scope of the study.
Study information is usually valid for a time frame, which is usually short, as the operating conditions are
subject to change.
Control information: It is regular and frequent information that is gathered every hour, shift, day, month and
year. This information is helpful to management for living within budgets and surveillance. For example, the
daily specific energy consumption (kWh per unit of production) or the ratio of utility energy consumption to
the total energy consumption of a facility.
Budget information is used for projecting the future expenditure. In energy budgeting, this usually implies
information that helps to predict the energy and utility consumption and costs on a monthly or annual basis.
All types of information are interlinked, but control information, which is regularly, monitored is usually the starting
point for both study information and budget information.
4.3 Data Monitoring

Data monitoring is further subdivided into three categories as explained below:
4.3.1 Data Collection
Monitoring begins with data collection. The issues to be addressed are:

What data is to be recorded and collected?
Mechanism - How it is to be collected?
Frequency How often is the data to be measured?
Some data may be available in existing records like energy bills, utility data log books, etc. Some data may be already
measured but not systematically recorded like pressures, flows etc. Some data may need additional instrumentation
for measurement and recording.
The mechanism for data collection may be manual or through recording instruments. The frequency of measurement
will depend on the utility of the recorded data. Occasional data collection, where the clock time is not very important,
can be done manually. However, in cases where the clock time is very important, recording instruments with sufficient
non-volatile memory or printers would be required.
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4.3.2 Data Analysis

From a monitoring and targeting viewpoint, industrial operations are divided into two groups.
Group-1: Processes where energy use is largely decided by the physics of the process. This group includes heatbased processes (like heating, evaporation, melting etc), all chemical and electrochemical processes, work based
processes like refrigeration, compressed air etc.
Group-2: Here the physics of a process gives a poor indication of energy consumed. Examples are cutting, sizing,
conveying etc.
The industrial processes in group-1 are good candidates for M&T applications. In group-2, efforts should be made
to find out variables, which are in some way correlated to production. For example, consider a CNC machine
shop, which is a major load for air conditioning. It may be difficult to correlate quantity of production with energy
consumption. Variations in ambient temperature (concept of degree-days may be used) can be correlated to energy
consumption
4.3.3 Regression Analysis
Regression analysis is used to model the relationship between a response variable and one or more predictor
variables.
Figure 4.2 represents a basic pattern to which the behaviour of most processes can be related. Such a graph contains
three elements:
Energy consumption vs. Production of Pm1
3000000
2500000
Ene rgy, kWh
2000000
1500000
1000000
500000
0
3000
3500
4000
4500
5000
5500
6000
Production, Tons
Fig. 4.2 Regression analysis for a paper industry

An intercept (the point where a best fit line through the data cuts the energy axis at zero production) - this is the
energy that would be required if this process ran but did not produce anything. It is also energy consumption
that continues while production is in progress but does not contribute to production.
A slope - the amount of energy required at any given level of production to process each additional unit of
production. The efficiency of the process can be established from the slope.
The scatter - the amount by which the energy used for any one level of production varies from one period to
another. This tends to be governed by operational factors
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The graph has an intercept on the energy axis, the line is straight over the whole range of production, there is not
much scatter, and production covers a wide range. The best-fit line to the data can be formulated as:
Energy = (m x production) + c
Where, c and m are empirical coefficients (empirical means they are determined from the data, by either fitting a
line to the data by eye or calculating it from the data)
Note from fig. 4.2 that the slope of the line is less and it has a high y-intercept. There are three common circumstances
which give rise to this pattern:

The process has innate characteristics that give it a high standing consumption but low additional consumption
for each unit of production. Work-based processes in the production of plastic extrusions are a good example. In
addition, processes with variable output driven by fixed-speed motors also often show a high intercept (although
the line may be curved).
The process does not have a naturally high standing consumption but a fault is causing a high and continuous
energy loss, e.g. faulty steam traps on steam-heated equipment such as sterilisers or rubber tyre moulding
presses.
Processes where the energy consumption is representative of a fixed duty and the production variable used does not
take adequate account of the real duty. An example is paper production where this shape of graph real duty.
For instance: The correlation of energy consumption with production can be done by using linear regression
technique. This feature is available on Microsoft Excel. However, the linear equation is valid only if the correlation
coefficient (R2 value) is greater than 0.9. The following examples will illustrate the utility of this method in practical
situations.
The following table shows monthly energy consumption and production of a Carbon Black manufacturing plant.
The raw material (LSHS) is burnt in presence of high-pressure spray of water to produce carbon black.
Month
Total Energy
kWh
Production
Tons
Spec. energy kWh/

Ton
Jan-02
286458
975
293.80
Feb-02
357883
1279
279.81
Mar-02
396933
1466
270.76
Apr-02
318851
1172
272.06
May-02
389815
1476
264.10
Jun-02
376553
1429
263.51
Jul-02
393030
1493
263.25
Aug-02
401932
1495
268.85
Sep-02
377591
1463
258.09
Oct-02
351390
1282
274.10
Nov-02
395351
1465
269.86
Dec-02
415698
1534
270.99
Table 4.1 Summary of production and energy consumption
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A plot of energy consumption vs. production is given in fig. 4.3.

Regression chart
450000
Y=229.66x+56706
2
R =0.9582
400000
Energy co nsumptio n
350000
300000
250000
200000
150000
100000
50000
0
200
400
500
800
1000
1200
1400
1600
1800
Production
Fig. 4.3 Regression analysis

A regression analysis was done on the above data from Jan-02 to Mar-03 (15 months) to arrive at a relationship
between energy consumption and production. The following relationship has been obtained with an accuracy of
99%.
Energy = 56706 + 229.7 X Production
From this relationship, expected energy consumption for a given production can be calculated. The number 56706
represents a constant energy consumption, which does not vary with production, indicating leakages, losses, lighting,
and office loads etc.
This relationship can be used for setting targets. Presently, the daily energy consumption and production is compared
on a daily basis. Comparing only daily energy consumption figures in a month can not alone be sufficient to arrive
at any conclusion regarding efficient operation of the plant.
To further understand the variation in energy consumption with production, a powerful tool called CUSUM
(Cumulative SUM of Differences) is used. This is the cumulative sum of the differences in actual energy consumption
and predicted energy consumption.
4.4 CUSUM
Cumulative Sum (CUSUM) represents the difference between the base line (expected or standard consumption)
and the actual consumption points over the base line period of time. This useful technique not only provides a trend
line, it also calculates savings/losses to date and shows when the performance changes. It can be used effectively
to remain within energy budgets in any time frame, say a week, month or year.
Regression analyses need to be done before we attempt CUSUM. From the regression analysis, we can arrive at an
equation representing the relationship of energy consumption and production. This equation is then used to predict
energy consumption for given production. The previous example used in regression above is used here for CUSUM
analysis.
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Table 4.2 illustrates the calculation of CUSUM and fig. 4.4 shows CUSUM chart.
Month
Total Unit
kWh
Production
Tons
Predicted
Differences
CUSUM
kWh
kWh
kWh
Jan-02
286458
975
280664
5795
5795
Feb-02
357883
1279
350492
7391
13185
Mar-02
396933
1466
393446
3487
16672
Apr-02
318851
1172
325914
-7063
9609
May-02
389815
1476
395743
-5928
3680
Jun-02
376553
1429
384947
-8394
-4714
Jul-02
393030
1493
399648
-6618
-11332
Aug-02
401932
1495
400108
1825
-9507
Sep-02
377591
1463
392757
-15166
-24674
Oct-02
351390
1282
351181
209
-24465
Nov-02
395351
1465
393217
2135
-22330
Dec-02
415698
1534
409066
6632
-15698
Jan-03
419302
1518
405391
13911
-1787
Feb-03
377475
1418
382421
-4946
-6732
Mar-03
424982
1578
419173
5809
-923
Table 4.2 Actual and expected energy consumption

20000
15000
10000
CUSUM
5000
0
Jan- Feb- Mar- Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan- Feb- Mar02 02 02
02 02 02 02 02 02 02 02 03 03 03
-5000 02
-10000
-15000
-20000
-25000
-30000
Month
Fig. 4.4 CUSUM chart
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Inferences drawn:

The Differences can have positive and negative values. If positive, it means the actual energy consumption has
been more than the expected energy consumption. If negative, it means actual value is less than expected value,
which is an indication of good efficient performance of the plant.
It can be seen from fig. 4.4 that CUSUM increases from January to March, indicating higher than expected
energy consumption.
From March, the actual energy consumption reduced and more or less continued in that fashion till September
2002. This indicates good performance.
From September onwards the actual energy consumption has been rising compared to expected consumption.
From Jan-03 onwards, the actual energy consumption appear to be reducing compared to the expected value,
indicating better performance.
This exercise can also be done on a daily basis for more relevance so that corrective actions can be taken
immediately. However, the data collected need to be more precise and classification of product also need to be
done separately according to the grade.
4.5 Target Setting

Target setting is essential to fix an achievable reduction in energy consumption and maintain pressure on the energy
conservation team and the operating personnel to retain their focus on regular energy monitoring and implementation
of energy saving projects.
In some organisations, targets for across-the-board energy reductions are set without in- depth study and analyses.
Though this approach is inevitable in certain organisations with large number of disparate and variable energy
consuming processes and activities, arbitrary target setting is not advisable, as it may not achieve the full potential
of energy reduction or also result in unachievable, unrealistic targets. Realistic target setting requires a good
understanding of the energy consumption patterns of various processes and equipments in the facility and the
planned energy management projects.
Energy saving targets generally should be reflected in lower energy budgets and consumption on a monthly and
annual basis. Targeting can also be done for day-to-day operational control; this is done generally to minimise
variations in daily energy consumption.
Targets for daily, weekly, monthly and annual energy consumption are required to ensure regular energy monitoring
and implementation of planned projects.
4.5.1 Target Values
Preliminary targets
Monitoring of energy consumption will generally show variations in specific energy consumption. Generally the
specific energy consumption will vary with the production, volume and other variables. Historical average specific
energy consumption can be obtained for different production levels and other variables like seasonal conditions
etc. The first step in target setting is to move closer to the lowest specific consumption at comparable production
levels.
Targets for specific energy consumption can also be set separately for processes directly related with production
and utility energy consumption. Targets can also be set for the utility energy consumption in relation to the energy
consumption for production.
Elevated targets
After achievement of preliminary targets based on historical average energy consumption data, the targets have to
rise to reflect the realistic energy savings due to planned energy saving projects. The revision of targets should be
done on a continuous basis as implementation of energy saving projects progress.
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4.6 Reporting
Reporting is an important part of surveillance of energy consumption and energy conservation. The objective of
reporting is to ensure that all personnel receive information on energy consumption, energy cost and energy saving
projects to the extent that is relevant to them. It has to be done in a manner that uncluttered information on energy
consumption, specific energy consumption and energy savings are available to the top management, sectional heads,
members of energy conservation cell and the operating personnel.
Since the involvement and tasks of various stakeholders differ, the report for each stakeholder will differ in the
extent of details included. For the top management, a summary of important numbers, implemented energy saving
projects (both successes and failures) and projects on the anvil is generally sufficient. The reports to various sectional
heads would have to be more detailed, especially in relation to the energy consumption and projects implemented
in their respective sections.
The operating personnel will have to be provided information in a manner that helps sustain their interest in the
energy conservation activity; special emphasis should be on reporting the success stories and energy savings that
have accrued due to their efforts. The reports to the energy conservation cell will have to be very detailed with microanalyses of the energy consumption trends, the achievements in relation to the targets, critiques of both the successful
and failed projects, progress on planned projects and proposed changes in the energy conservation strategy.
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Summary

Energy monitoring and targeting is primarily a management technique that uses energy information as a
basis to eliminate waste, reduce and control current level of energy use and improve the existing operating
procedures.
Monitoring is essentially aimed at establishing the existing pattern of energy consumption.
Targeting is the identification of energy consumption level which is desirable as a management goal to work
towards energy conservation; it is the logical consequence of monitoring and implies setting achievable targets
for reduction of specific energy consumption based on the following information:
The primary objective of monitoring and targeting in energy management is to identify energy saving opportunities
and maintain surveillance on energy consumption with respect to the energy baseline and planned energy saving
targets.
The essential elements of M&T system are: recording, analysing, comparing, setting targets, monitoring,
reporting, and controlling.
Data collection without clear objectives can lead to collection of voluminous, often useless, data that is confusing
and difficult to analyse.
Regression analysis is used to model the relationship between a response variable and one or more predictor
variables.
Cumulative Sum (CUSUM) represents the difference between the base line (expected or standard consumption)
and the actual consumption points over the base line period of time.
Target setting is essential to fix an achievable reduction in energy consumption and maintain pressure on the
energy conservation team and the operating personnel to retain their focus on regular energy monitoring and
implementation of energy saving projects.
Reporting is an important part of surveillance of energy consumption and energy conservation. The objective
of reporting is to ensure that all personnel receive information on energy consumption, energy cost and energy
saving projects to the extent that is relevant to them.
References

http://www.bee- india.nic.in/energy_managers_auditors/documents/guide_books/1Ch8.pdf. Last assessed on

12th January, 2011.
http://www.statgraphics.com/regression_analysis.htm#simple. Last assessed on 12th January, 2011.
http://www.esru.strath.ac.uk/EandE/Web_sites/07- 08/Hotel_planning/Website%20Pages/User%20Manual%20
-%20CUSUM%20Analysis.html. Last assessed on 12th January, 2011.
Recommended Reading

D. G. Gotel (1989). The Application of Monitoring & Targeting to Energy Management (Home Office Research
Study). HMSO Books.
Jeff S Haberl (1992). Building energy monitoring workbook. Energy Systems Laboratory, Texas A & M
University.
Jeffery Cosiol (1982). Energy monitoring and control systems - performance verification and endurance test
procedures. Naval Civil Engineering Laboratory.
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Self Assessment
1. Energy monitoring and targeting is built on the principle of _____.
a. production can be reduced to achieve reduced energy consumption
b. consumption of energy is proportional to production rate
c. you cannot manage what you do not measure
d. most raw materials arrive at room temperature and most finished products leave at room temperature
2. What is CUSUM?
a. Cumbersome
b. Cumulative Sum
c. Calculated Sum
3. Collective SumFor any company, energy consumption mostly relates to_______.
a. profits
b. inventory
c. production
d. target
4. The empirical relationship used to plot production Vs Energy consumption is (Y= energy consumed for the
period; C = fixed energy consumption; M = energy consumption directly related to production; X= production
for same period).
a. X=Y+MC
b. Y=Mx+C
c. M=Cx+Y
d. C=Mx+Y
5. What do you mean by toe?
a. Total oil equivalent
b. Tons of effluent
c. Tons of oil equivalents
d. Total oil energy
6. What is specific energy consumption?
a. Energy consumption per month
b. Energy consumption per year
c. Energy consumption per hour
d. Energy consumed per unit of production
a. Monitoring of energy consumption will generally remain constant in specific energy consumption
b. The energy used by any business varies with production processes, volumes and input
c. Budget information is used for projecting the future expenditure
d. The correlation of energy consumption with production can be done by using linear regression technique
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8. In a regression analysis, which value of correlation coefficient is more desirable?

a. 0.1
b. 0.3
c. 0.9
d. 0.7
9. A plant having higher portion of fixed energy consumption, from the regression equation is indicated by:
a. Zero y-intercept
b. High slope and low y-intercept
c. Low slope and higher y-intercept
d. Low slope and higher x-intercept
10. Monitoring targeting system is not likely to result in:
a. Improved productivity of energy and other utilities
b. Improved preventive maintenance
c. Improved targeting
d. Increased wastage of materials
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Chapter V
Energy Audit/Management Case Studies
Aim

explain the characteristics of energy saving organisations
enlist the examples of energy saving techniques
explicate key factors and criteria of decision making
Objectives

explain thermal energy management
describe case studies on electrical energy management
enlist examples of projects not implemented
Learning outcome
At the end of this chapter, you will be:

understand the barriers to successful implementation
identify use of energy efficient ladle preheating system
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5.1 Introduction
Human beings, who are almost unique in having the ability to learn from the experience of others, are also remarkable
for their apparent disinclination to do so. - Douglas Adams
Energy management is a relatively new area of cost cutting for many organisations. Indian companies in core sectors
like Paper, Chlor alkali, Cement etc have turned around from the level of average energy performance to being
world beaters. Of course, the government policies in the last 15 years have also played a big role in their level of
achievements. However, the concept energy as a manageable expense is a key factor, which other industries can
also benefit from.
The characteristics of successful organisations are:

top management support
better coordination of energy manager and other departments through Energy Steering Committee
clear economic criteria for screening of energy management projects
awareness motivation among the whole spectrum of operating staff
5.2 Case Studies on Thermal Energy Management

Discussed below are the five case studies on various concepts of thermal energy management.
5.2.1 Control of Excess Air in Fluidised Bed Combustion (FBC) Boilers
A paper manufacturing plant has 3 FBC boilers of 60 TPH of which two are in operation always. The boilers are coal
fired. Steam generation of average 80- 90 TPH at 60kgf caters to power and process requirement of the plant.
Boiler efficiency trials on the boilers were carried out by the energy auditor. parameters like:

generation pattern
steam pressure
feed water temperature
Induced draft
Forced draft fan flow rates
flue gas temperatures
percentages of CO2, O2 and CO.
were monitored. The boiler operating efficiency was 78% to 79%. O2 & CO2 were around 13% and 7% respectively
in the flue gases at 167oC. The efficiency of the boilers was improved from 80% to 81% by controlling flow of air
into the boiler such that O2 levels were around 8.5% in the flue gases.
l
An optimum level of O2 (air) is required in the boiler depending on type of boiler and type of fuel. If there is less than
required quantity of air, combustion is poor. If the air quantity is more, the extra amount of air is just heated up and
let out through the flue. O2 levels are an indicator of the airflow into the boiler. The O2 levels have to be maintained at
an optimum level by adjustment of damper openings, speed of fans, vane control etc. to ensure maximum operating
efficiency of boilers at different operating loads.
Plant operators were hesitant to lower the flow of air into the boiler. It was feared that by reducing flow the velocity
of air would drastically reduce resulting in poor fluidisation. The air velocity has been set at minimum level (18.5
m3/ sec) after trials. The online gas monitors were not functional and thus setting the operating points was a tedious
exercise using fyrite kits.
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Particulars of actual energy savings

Improvement in boiler efficiency

Savings in coal per month
Annual total energy savings, tonnes coal
Annual cost savings, `. lakhs
Cost of implementation, `. lakhs
Simple payback period, Year
1%
120 tonnes
1400
30.24
Nil
Immediate
This measure was implemented by only controlling the flow of air into the boiler while maintaining the minimum
velocity as this is a FBC boiler. Numerous trials were carried out before arriving at the optimal operating point.
5.2.2 Reduction in Distribution Losses in Steam Distribution Lines by Revamping the Insulation
A leading pharmaceutical company has one 4 tph boiler to meet the steam requirement of the plant. The boiler uses
furnace oil and consumes about 900 kL of furnace oil per year, which accounts for about `. 60 Lakhs. The steam
generation pressure at the common header varies from 7-9 kg/cm2-g. Steam is supplied to various sections of the
plant.
Detailed survey indicated that the insulation of the steam lines was completely damaged. The surface temperatures
measured in the range of 68-80C, which were on higher side. The steam insulation was damaged from the top
and it was also observed that the water was entrapped in the insulation and causing huge steam losses. Estimated
surface heat losses indicated that about 16-17 lph of furnace oil was consumed to compensate the losses. Plant has
taken immediate measure to replace the entire insulation with 2 to 3 thick insulation.
Transmission losses in steam lines mean that energy lost in the pipelines has to be compensated by providing more
energy at the boiler.
Considerable fuel savings result by proper insulation of steam lines. It also ensures that the desired quality of steam
reaches the user end.
Details of techno-economics:
Insulation details before and after implementation
Particulars
Value
Units
Surface temperature before replacing the insulation
68-80
Surface temperature after replacing the insulation
35-37
Estimated FO oil loss before modification
16.7
lph
Estimated FO loss after the insulation
2.8
lph
FO savings
13.9
lph
Cost savings
100
kL/year
Investment
12.7
Rs lakh/year
Payback period
3.0
Months
5.2.3 Refrigeration - Speed Reduction of Chilling Plant Compressors

The company situated near Baroda manufactures benzene derivatives. The major load in the plant was refrigeration.
Two compressors were working; one for chilled water and the other for brine. Refrigeration compressors were
operating at 50 to 60% of the time only. This indicated excess capacity of compressor. It was suggested to reduce
the speed of compressors by 40% by changing pulley size, keeping in view, the minimum speed of operation
recommended by the manufacturer.
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The refrigeration capacity is proportional to the speed of the compressor. Hence it was suggested to reduce the speed
of brine compressor from 750 rpm to 500 rpm and the speed of chilled water compressor from 780 rpm to 400 rpm.
The compressors operating hours, after reducing the speed, were expected to increase. Since, under this derated
condition, the existing evaporator and the condenser are oversized, the specific power consumption was expected
to reduce resulting in energy savings.
Equipment
Rating
Before Modification
After Modification
kW
Input power, KW
kW/TR
Input power, KW
kW/TR
Chilled water plant compressor
90 kW
74
1.2
35.6
0.7
Brine plant compressor
55 kW
53
1.6
32.3
1.2
Table 5.1 Compressor speed reduction

Energy savings on brine chiller = 60500 kWh/annum = Rs 2.7 lakhs/annum Energy savings on water chiller = 54,500
kWh/annum = Rs 2.5 lakhs/annum Investment for 2 nos pulleys = Rs 5000/- each = Rs 10,000/5.2.4 Sugar Industry - Back-pressure Steam Turbine and Bagasse Fired Boiler
Generally, in all sugar mills, the cogeneration systems having configuration of steam turbine generator (back-pressure
or extraction-cum-back-pressure type) and fired boiler are found working, providing the best performance results.
Moreover, such type of cogeneration system fires non-conventional fuel bagasse (sugar cane waste) in the boiler
and then also works at optimum efficiency.
The captive power plant (CPP) consists of major equipment detailed below:
a. 6 numbers of Back-pressure type, single stage steam turbine generator sets as per ratings provided below:

1 x 1500 kVA (1 x 1200 kW)
1 x 1875 kVA (1 x 1500 kW)
1 x 3125 kVA (1 x 2500 kW)
1 x 3750 kVA (1 x 3000 kW)
2 x 3750 kVA (2 x 3000 kW)
b. Eight numbers of Bagasse fired steam generators as per ratings provided below:

1 x 60 TPH, 30 Kg/cm2, 375C
1 x 50 TPH, 20 Kg/cm2, 375C
5 x 30 TPH, 20 Kg/cm2, 375C
1 x 25 TPH, 20 Kg/cm2, 375C
Normal operating philosophy

The sugar manufacturing plant works on seasonal basis, i.e., generally for a period of eight months from September
to April every year, when the sugarcane crop would be available for crushing. In remaining four months, rigorous
preventive maintenance of all the equipment is carried out so that the plant works without any problem during
ensuing season.
In the case study provided, generally, 2 x 3000 kW (new) Triveni steam turbine generators with 60 TPH WIL boilers,
and 1 x 3000 kW (old) Belliss steam turbine generator and 1 x 2500 kW Triveni steam turbine generator with 50
TPH and 30 TPH boilers in required numbers are operated at full load. As 2 x 3000 kW steam turbine generators
and 60 TPH boilers are matching with each other so far steam parameters is concerned, i.e. it becomes one island.
Second island is formed by remaining steam turbine generators and boilers due to matching of steam parameters.
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Remaining equipment is operated either in the event of breakdown or shutdown of any of the above units, or
according to the power and steam load requirements by the production. The CPP meets the total electric power and
steam requirements of the manufacturing plant as soon as the production is commenced consequent to availability
of sugarcane for crushing.
The plant is working conforming to the concept of total co-generation power plant technology, which is encouraged
all around the world in a big way due to conformance to very vital concept of energy conservation.
The electric power generated in CPP is totally utilised to operate the process equipment, utilities and plant/office/
area illumination. During normal plant operations, the power generation is maintained at more than 90% of machine
rating and around 0.85 power factor so as to get optimum efficiency.
Power plant performance analysis
Based on the plant operating data for last 12 months available for two cogeneration islands, the CPP performance
has been arrived at as follows.
Electrical generation output = 2949 kW X 2 = 5898 kW
= 5898 x 860 x 4.18 kJ/h
= 2,12,02,130 kJ/h
29 TPH x 2 = 58 TPH at 1.0 bar.
Enthalpy of steam at 1.0 bar = 642 kcal/kg
Energy in steam out put
= 58 x 1000 x 642 x 4.18 kJ/h
= 15,56,46,480 kJ/h
Total energy output = 17,68,48,610 kJ/h
Total fuel input

= 27 TPH bagasse
GCV of Bagasse

= 2288 kCal/kg
Total energy input

= 27 x 1000 x 2288 x 4.18 kJ/h

= 25,82,23,680 kJ/h
Overall efficiency
= Total energy output/Total energy input = 68.5%

Island#1
3000 kW Steam turbine generator #1 & 2
60 TPH Boilers
Island#2
2500 kW Steam turbine generator # 1
3000 kW Steam turbine generator # 1
50 TPH and 30 TPH Boilers
Plant Load Overall Factor Efficiency

82.63%
68.5%
64.70%
66.74%
The power load on new steam turbine generators is maintained almost constant due to their better performance,
the steam load is also maintained on the connected boiler, and as such the plant load factor and efficiency are
observed better in this system. The power load variations are generally taken care of by the system consisting
of older steam turbines and boilers, as such the plant load factor and efficiency have been observed marginally
in comparison to Island#1 mentioned above.
The average age of the steam turbines and boilers is around eight years. The specific steam consumption
derived based on the enthalpy difference method is found only marginally offset from the data provided by the
manufacturer, which could also be due to some disparity between required and actual inlet steam parameters.
There is no provision for measurement of actual quantity of Bagasse being fired in the boilers. Hence, actual
data for steam generation vis--vis fuel is not generated for the CPP. Based on derivation of specific steam
consumption, noted steam parameters such as pressure and temperature, power load maintained and analysis of
Bagasse, the fuel consumption can be derived, which would provide reasonably accurate data. The calibrated
energy meters are provided for measurement of electricity.
Heat balance diagram for Island#1 is provided in fig. 5.1.
58/JNU OLE
32 Kg/cm2 steam
1 Kg/cm2 steam
Water circuit
Deaerator steam
TPH Kg/cm
Deg C Kcal/kg
2
Steam to sugar manufacturing process

29 1.0
120 642.4
3000 kW
420V
Generator
29 1.0
120 642.4
G
Backpressure
steam
turbine
2949kW
actual
2949kW
actual
29 31
370 758
58 32
375 768.5
Chimney
stack
3000 kW
420V
Generator
2 32
375 768.5
PRV
Water
pre-heater
Bled steam
61
45
60TPH
Fired
boiler
6.0
45
2 0.7
250 658.3
60 32
375 768.5
Deaerator
Combustion air
61 6.0
55 55
DM water pump
63
110
Fuel: Bagasse
27MT/hr
35
110
63
90
1.0
90
Boiler feed pump
DM water
Make-up
Fig. 5.1 Sugar mill cogeneration system

5.2.5 Chemical Industry - Heat Recovery from Exhaust Gas in a Spray Dryer
A spray dryer having 400 tons/h water evaporation capacity is used to dry inorganic salts. The input air is heated
by direct gas firing to between 200 and 300o C. The feedstock was having initial temperature between 20 and 60o C
and a moisture content of 40 to 60% by weight. The feedstock enters the dryer through a rotating disk atomiser.
The dried solid is separated from the exhaust air in a cyclone. The exhaust air has an average temperature between
100 to 112oC.
A heat exchanger was installed to recover heat from the exhaust air, to preheat the incoming air. A schematic of the
system after modification is given below in fig. 5.2.
59/JNU OLE
Heat Exchanger
Aux.fan
Feed stock
Spray
Dryer
Air heater
Gas
Main fan
Exhaust
Air inlet
Main cyclone
Scrubber
Aux.cyclone
Product
Fig. 5.2 Heat recovery- spray dryer

The heat recovery device used was a glass tube recuperator. The dryer exhaust air flows upwards through the inside
of the tubes. The glass tubes were used essentially to prevent corrosion of tubes due to salty vapours.
It was found that after the installation of heat exchanger, the gas consumption in dryer was found to reduce from
60.7 m3/h to 40.6 m3/h. For an average production rate of 300 kg/hr dry products, the specific energy consumption
reduced from 6.6 MJ/kg to 5 MJ/kg
5.3 Case Studies on Electrical Energy Management

5.3.1 Optimising Transformer Loading
A leading automobile manufacturer has main incomer at 132 kV. This voltage is stepped down to 11 kV. From 11
kV to 433 V, plant has several transformers located in eight substations.
During an energy audit, loading on transformers located at various substations was analysed. In few of the cases
it was observed that some transformers are grossly under loaded (around 10-20%) and the scope exists to shift or
distribute this load to other transformer in the substation. This would also ensure optimum level of loading. While
achieving optimum loading, the standby transformers at various substations were suggested to be kept open on
H.T side to save no-load losses. Also an operating schedule was proposed to alternate the transformer operation
weekly so as to keep them in good health. In sub station # 1, one transformer was kept as stand by. This hot standby
transformer can be kept open (Energy savings 0.45 lakhs per annum).
In sub station # 3, transformers #1 and #2 were drastically under loaded (i.e, 20% and 15% respectively). Loads
of transformer # 2 was transferred to Transformer # 1 and Transformer # 2 was switched off (Energy savings 0.37
lakhs kWh/year) In sub station # 7, transformers # 2 and # 3 were drastically under loaded (i.e., 10% and 25%
respectively). Loads of transformer # 2 was transferred to Transformer # 2 and Transformer # 2 was switched off
(Energy savings 0.42 lakhs kWh/year) In substation # 8, keeping hot standby transformer open, resulted in energy
saving of 0.45 lakhs kWh per year.
Annual Total energy savings, ` 1.69 lakhs KWh
Annual Cost savings, ` 5.9 lakhs
Cost of Implementation Nil
Simple payback period, Immediate
60/JNU OLE
5.3.2 Operation in Star Connection for Under Loaded Motors

When motors are under-loaded, their torque requirement is less compared to that at full load. Hence, the voltage to
be impressed on the winding is also less due to less torque required.
In Delta-Connection, the line voltage is impressed on each motor phase winding. Whereas in star connection,
line voltage divided by 3 is impressed on each phase winding.
When star connected, the current drawn by the motor drops significantly, power factor increase also takes place.
Overall power saving is likely to be 10 to 20% depending on the extent of under loading. In this edible oil (Vanaspati)
manufacturing company, a 25 hp/18.5 KW motor was driving a cooling water circulation pump. The electrical
measurements in delta connection were as follows:
Voltage
Current
Power Factor
Power Input
Speed
:
:
:
:
:
415 V
18.5 A
0.505
6.72 KW
1469 rpm
Considering the fact that the load was less than 30%, it was decided to operate the motor in star connection.
Voltage
Current
Power Factor
Power Input
Speed
:
:
:
:
:
415 V
9.5 A
0.873
5.96KW
1454 rpm
It may be noted that the current has dropped but the power considering the fact that the load was less than 30%, it
was decided to operate the motor in star connection.
Voltage
Current
Power Factor
Power Input
Speed
:
:
:
:
:
415 V
9.5 A
0.873
5.96KW
1454 rpm
Annual energy Savings: 4560 kWh
Actual cost savings: Rs 18,240
Actual investment: Minor
Payback: Immediate
5.3.3 Replacement of Pump Impellers at a Synthetic Yarn Plant

The utility equipment comprising three numbers centrifugal chillers, three to four numbers air compressors, and
two numbers refrigeration dryers were cooled by three numbers cooling tower pumps.
Pump Specifications: Head: 30m, Flow: 550 m3/hr, Speed: 1450 rpm,
The cooling water piping was very liberally designed and pipe friction losses were very low (schematic drawing
shown in figure). During the energy audit, it was observed that the valves on the return line of each cooling tower cell
were kept about 70% closed and that the pumps were operating at about 35 m head. Detailed pressure measurements
indicated that about 70% of the pressure drop in the entire system was in throttled valves.
61/JNU OLE
This implied that there was a large mismatch between the pump and the piping system for the required operating
flows. After a detailed study, it was decided to replace the existing 342 mm dia. impellers with 307 mm dia. impellers
and only slightly throttled to balance the flow. The savings are estimated to be 376800 kWh/annum i.e. ` 15 lakhs
per annum. The pay back period on an investment of ` 75,000/- (for 3 nos. new impellers) was 18 days.
Impeller diameter, mm
Head, m
Flow, m3/hr (per pump)
Motor input, kW (per pump)
Power savings for 3 pumps, kW
Energy savings, kWh
Money saved, `
Investment, `.
Payback, days
342
35.00
380
52.7
307
28.00
380
37
47.10
376800
1507200
75000
18
Table 5.2 Pump impeller replacement

5.3.4 Use of Lighting Voltage Controller to Reduce Lighting Energy Consumption
A paper manufacturing plant has a connected lighting load of nearly 370 kW. This consists of fluorescent fittings,
HPSV, HPMV & CFL lamps for plant, office and area lighting. The lighting load is fed from 3.3 kV bus by 4 numbers
of LT transformers. These transformers have lighting loads apart from other loads. Each transformer is connected
to a lighting circuit distribution box. The total actual load varies between 300 to 350 kW during night. Meters are
fitted at each DB to measure power consumption.
The voltage levels at lighting DBs vary between 225 & 240 V. Lighting loads consume less power at lower voltages.
The plant lighting voltages were at a level, which could be brought down further. The installation of lighting voltage
controllers, of different kVA, on each DB brought down the lighting consumption by 20%. The output voltages
were set at 210 V.
Particulars of actual energy savings
Number of DB lighting circuits = 4
Total power consumption = 338 kW
After installation
Total power consumption = 275 kW
Annual total energy savings, lakh kWh = 2.45
Annual cost savings, `. lakh = 4.89
Cost of implementation, `. lakh = 12.37
Simple payback period, in years = 2 year 6 months
5.3.5 Thermostat Based Operation of Cooling Tower Fan
Automatic temperature control for the operation of cooling tower fan resulted in switching off cooling tower fan
whenever heat load on the cooling tower is reduced.
The unit has centralised cooling tower to meet the cooling water requirement. The major heat loads are a glass
furnace and refrigeration condensers. The cooling tower has three cells and each cell is served by individual fan.
All three fans were operated and no control systems were installed to the cooling tower for the auto operation of
fans. Detailed analysis and measurement carried out during full production of the plant.
62/JNU OLE
Design cooling load of the cooling tower: 4 lakhs kcal/h

Number of cells: 3
Design heat load of each load: 1.33 lakhs kcal/h
Design range: 5 C
Measured range: 5 C
Measured approach: 0.5-1.0 C
Design cooling water flow rated: 800 m3/h
Actual water flow rate (measured): 485 m3/h
Present heat load: 2.43 lakhs kcal/h
Power consumption by one fan: 6 kW
It can be seen that the actual heat load is about 60% of the total heat load which can be met by two cells only.
Plant has taken immediate steps and incorporated the thermostat to one fan. It was observed post-implementation
that the fan remained switched off continuously since the cooling tower cells were able to meet the demand.
Cost benefit analysis

Type of Measure: Low cost measure
Annual energy Savings: 51,000 kWh
Actual cost savings: ` 1.53 lakhs/annum
Actual investment: ` 25,000/-
Payback: Immediate
5.3.6 Automobile Industry - Reciprocating Engine System

One of the new breed of gas fired reciprocating engine based industrial cogeneration projects proliferating in France
is The Peugeot CHP (combined heat and power) installation at Mill house. This particular case study is taken from
Modern Power Systems magazine.
The cogeneration power plant (CPP) consists of major equipment detailed below:

10 x 2500 kVA (1 x 1830 kW) industrial heavy-duty gas fired reciprocating engine generator sets.
1 X 11.2 TPH, 16 Kg/cm2, 2010C unfired waste heat recovery boiler.
2 x 550 m3/hr, 78 0C-88 0C hot water generators.

a. The plant has been set up as joint venture Cummins Wartsila and Peugeot and the operation and maintenance
has been provided by Cummins Wartsila. Peugeot is car manufacturing plant with capacity to manufacture
1600 cars per day. It is the largest industrial facility in this region of France
b. The reciprocating engines are fired with natural gas. Maximum power that the engines can generate is 18.3
MW when nine engines are in service with one standby. Heat energy available in terms of MWT is 16.5 in
the form of steam and hot water. The generators are operated in parallel with each other with no back-up
from the state grid.
c. The exhaust flue gases from the reciprocating engines are diverted to the WHRB, which generates 11.2
TPH steam at 16 Kg/cm2 pressure and 20100C temperature. The steam is supplied to the car manufacturing
plant.
d. Balance heat available in the exhaust gases emanating from WHRB is utilised for generation of the hot
water. Further, the engines cooling systems are used to provide the additional heat to generate the hot water
via two heat exchangers. The hot water is available within temperature range of 77 880C. The hot water
is also utilised in the manufacturing plant.
63/JNU OLE
Utilisation of power
i. Total electric power generated from the cogeneration plant is sent to the grid via 400V/20 kV step up
generator transformer and Peugeot is continued to draw power via grid as per the practice prior to setting
of cogeneration facility.
ii. When the engines are operated at full load, the plant maintains optimum heat rate and thereby efficiency.
Moreover, the steam availability from WHRB is also maintained to optimum level to supply steam to the
manufacturing plant. This system has been observed working maintaining excellent efficiency level and
attractive economics for the cost of power and steam due to utilisation of substantial energy available in
primary source fuel.
Utilisation of steam and hot water
i. The plant is major consumer of process steam heat, which is utilised in the car painting process to its
full potential. With stoppage, alternate sources of energy for painting, substantial energy saving is also
achieved.
ii. The plant is situated in one of Frances coldest regions. Hence, the space heating is a must for the working
personnels comfort. Utilisation of hot water has resulted into saving of electrical energy used earlier for
providing the space heating.
Power plant performance analysis
Some interesting data for the plant performance for six months has been provided in the article, which is reproduced
below.
Guaranteed electrical efficiency

Guaranteed cogen system efficiency

Electrical energy generated in cogen plant
Energy generated in the form of steam
Energy generated in the form of hot water
Primary energy consumed, natural gas
Assuming LHV of natural gas
41 %
72 %
647.608 lakh kWhe
169.337 lakh kWhr
258.213 lakh kWht
175.036 lakh Nm3
Plant Overall
Heat rate Efficiency
1221 kCal/kWH
70.4
(7500 kCal/Nm3, the heat rate and cogeneration efficiency is estimated)

Increasing competition in the motor industry is causing the leading players to focus increasing various ways and
means to reduce the production cost. Outsourcing of heat energy adopted by the company as solution has resulted
into saving of energy.
Prior to selection of reciprocating engine, the gas turbines were considered. The competitive advantage of
reciprocating engines derives from their higher electrical efficiency. For a given set of conditions and with the same
fuel consumption, the electric power produced by reciprocating engines is more than that for turbines, resulting in
better economy. Moreover, the reciprocating engines require a lower gas feeding pressure (around 4 bar against 1720 bar for gas turbines). Hence, gas compressor was not required for saving enormous cost of the plant. Auxiliary
consumption in reciprocating based power plant is the least among all cogeneration systems.
Heat balance diagram for the cogeneration system is provided on next page in fig. 5.3.
64/JNU OLE
To Peugeot
plant
120 C
Steam
11.2 TPH
201 C
0
Chimney
Generator
transformer
400v/20kV
Exhaust
3900 C
Heat
exchangers
0
WHRB
212 C
Gas engine
generators
Engine
Cooling system
Gas Engine
10 x 1830 kW
Natural gas
Air cooler
Hot water
0
78-88 C
550 m3 /hr
40 C
0
30 C
Air cooler
Heat
exchangers
Fig. 5.3 Gas engine based cogeneration plant
5.4 Barriers to Successful Implementation

Some interesting information available from the Bureau of Energy Efficiency, New Delhi, on the barriers to energy
saving projects is given below.

Cost of energy is too small when compared to production cost: The sectors where the energy cost is low as a
percentage of production cost include pharmaceuticals, engineering (heavy and light), value added products,
assembly units, automobile units, machine shops, fabrication units, electronic units, appliances, garments, etc.
In these units the energy cost is normally lesser than 5% of the total production cost. Though there is potential
of about 20% savings in total energy cost, the cost of production can be reduced by maximum 1%. This makes
the management not to venture for the energy audit.
Non involvement or poor co-ordination among the inter-departments: Normally most of the energy audits services
will be coordinated by the maintenance or utility department rather than the energy consumers (production or
process personnel). Making the energy consumers (process or production departments) equally responsible for
the energy conservation by making the balanced team from both sides is very important.
Lack of minimum instrumentation, metering and monitoring: In addition to portable instrumentation employed
by the external auditor, some amount of metering and monitoring is required on plant side to have effective
field study to analyse the energy consumption minutely. Also, metering and monitoring by the plant makes a
historical trend assessment possible which may account for factors like seasonal variations, etc.
Plant sees only the first cost rather than life cycle cost while making the fresh purchase: High importance should
be given to life cycle cost of the equipment by considering energy, maintenance, depreciation and other costs.
Failure or poor performance of the energy saving retrofits or equipment supplied by the vendors due to inferior
quality or improper application. In many cases, in actual practice, the plant identifies the vendors locally who can
supply the similar type of equipment at low cost. After the implementation, in many cases these retrofits were
failed due to many reasons such as improper sizing, poor quality, technology adopted, location, poor attention
given, lack of expertise, etc. Hence plant will revert to original situation.
New technology application: There are plenty of the new equipment or new technologies available in the market
and many of them resort to marketing gimmicks to penetrate the market. The function of the auditor or energy
manager is to evaluate this equipment thoroughly before recommending their use.
65/JNU OLE
Lack of Communication to down stream manpower (Operator Level) for EC Measures. In all Industrial units,
successful implementation of energy saving activities only depends upon proper communication with internal
customers (Execution area). Effect of EC measures should be properly communicated to the operators who will
actually perform their duty after any EC measures in that area.
Absence of alternative implementation strategies: Reports resulting from an industrial audit regularly include
a number of recommendations for energy savings. The recommendations normally calculate expected savings
and evaluate the costs of implementation. Usually, one of two forms of implementation of a new practice or
technology is recommended; either immediate implementation or incremental implementation where the items
are changed out as they fail. These two methods often fail to consider such concerns as risk (real or perceived),
comfort, the appropriate sizing and loading of equipment, availability of product, rebuilt products, time
constraints, disposal costs, and economies of scale.
Presentation too theoretical not able to convince the plant personnel during the presentation: During the
presentations of the report to the plant, the convincing skills of the auditor will depend upon his practical
approach rather than theoretical since in actual practice the practical skills are more important. The practical
approach of the auditor is most important and the plant personnel will get convinced if the auditor suggests the
measures, which are realistic, more practical and implementable.
At the same time the auditor should know about the concept behind the principle. But most of the auditors lack
the practical approach since they may not have on the job experience to implement the measures. Moreover, the
auditors do not consider the human involvement in implementing the measure.
Some of the examples are as follows:

Switching of the idle transformers during idle operation (plant personnel feel that moisture will ingress into the
transformers and also frequent on and off of the transformer requires human attention)
Switching of the Air condition units during non-occupancy times of the guests in the rooms. But the management
feels that when the guest enters the rooms there should be required conditions of the temperature inside the
rooms.
There are so many measures where the practical aspects should be considered very carefully before suggesting the
measures. The above measures can be implemented; but you need to convince the operating people and gain their
confidence.
Lack of expertise and resources during the energy audit field study: Many of the audit firms prefer methods, which
just focus on the cause and not the effect during the plant studies of the energy conservation measures. This is most
often, due to lack of theoretical background and measurement resources.
5.5 Examples of Projects not Implemented

5.5.1 Use of Soft Starter on Mechanical Presses
It may happen that a project which is technically sound and has demonstrated savings during an energy audit can
get sidelined for true economic reasons. The following is a case of proposal for a soft starter on a motor driving a
mechanical press.
This case study is from a leading home appliances manufacturing company. Presses are required to form metal
sheets into various shapes. The salient features of the press operation were:

The power consumption during one press cycle varied in the range 15-90% of the rated motor capacity (30
kW)
The power consumption also varied as per the thickness (higher the thickness more power is consumed)
The press were operated for variety of thickness
The power factor was varied in the range 0.30 0.78
66/JNU OLE
Proposal
In view of varying load and varying power factor it was suggested that soft starters could be installed to improve the
power factor during entire cycle of the operation and to have smooth operating. During the study, the manufacturer
of such equipment was called and asked to demonstrate the product. During demonstration trial it was ensured that
the press was operated for same thickness of the product for both cases. The results of the demonstration trial are:
Before installation of soft starter
Power consumption for one hour: 18 kWh
Power factor: 0.30-0.87
After installation of soft starter
Power consumption for one hour: 16.5 kWh
Power factor: 0.90
Energy savings: 1.5 kW
Percentage savings: 8%
Techno-economics:
Power savings: 1.5 kW
Operating hours: 5000 h
Annual energy savings: 7500 kWh
Annual cost savings (@ `.4.7 per kW): `. 0.35 lakh
Investment required: ` 1.50 lakh
Payback period: 4.29 years
Plant has not implemented due to:

Less operating hours of the equipment
High investment
Long payback period
5.5.2 Use of Roots Blower in Place of Air Compressors for Agitation

Resistance to change is often the biggest impedance in energy efficiency improvement projects. This case study
is of replacing compressed air with low pressure air from roots blower and is technically appreciated by the plant
personnel initially; however, they are waiting for another application where they can use the air compressor.
In a mineral unit, plant has slurry basins and cells for mixing and blending of minerals before sending the slurry for
filtration. Plant has four reciprocating compressors to generate compressed air, which are used for agitation. During
the normal operation only one or two compressors are operated.
The present consumption of compressed air in basins and cells is estimated at 1150 m3h and the corresponding power
consumption is measured at 72 kW. The compressed air generating/operating pressure is about 0.6 kg/cm22g. The
condition of the piping network was bad and required complete revamping of the system to reduce the leakage in
the system.
Suggestion
Use of roots blower air for agitation is more energy efficient when compared with the compressed air, since the
efficiency of blowers is much higher than compressors when these are operated at very low pressures. Energy savings
are estimated by keeping the operating pressure constant and increasing the air quantity by 25%.
67/JNU OLE
The proposed parameters were:

Pressure of blower air : 0.6 kg/cm2
Air quantity : 1450 m3/h
Techno-economics
Present power consumption : 72 kW
Proposed power consumption by blower at 0.6 kg/cm2g & 1450 m3/h is
estimated at 35 kW
Specific power : 24.5 cfm/kW
Power savings : 37 kW
Operating hours of basins and cells : 7500
Annual energy savings : 2.78 lakh kWh
Cost savings : `. 9.73 lakh
Investment required : `. 3.0 lakh
Payback period : 4 months
Initially the measure was appreciated by the plant but not implemented due to various reasons, such as:

The implementation requires sufficient down time of the equipment, which stops the production of the down
stream and upstream for a considerable time.
The compressors were recently procured by the plant, hence not interested in replacement.
5.5.3 Steam Trap Management

Efforts to save energy should be pursued relentlessly. In this case study on steam trap management, the energy audit
suggested measures on steam traps, which got implemented, but failed to continue periodic monitoring.
The steam lines in the plant have 30 numbers of steam traps on distribution side and 16 traps to the equipment.
During the energy audit, a detailed survey was carried out in the steam lines to identify the malfunctioning and not
working steam traps. The following table gives the analysis of the steam trap survey.
The audit team had suggested replacing the traps, which are not working/passing steam. It was also suggested to
monitor the working condition of all the steam traps and replace/repair the faulty traps as a regular maintenance
practice, at least once in three months.
A recurring expenditure is expected towards spares, manpower and contractor charges since the plant may not be
able to divert its manpower whenever fault is developed. The task can be given to the external contractor.
Particulars
Number of traps provided
Number of traps not working
Number of traps passing steam
Particulars
Steam savings
Heat savings
HSD savings
Annual fuel savings @ 7200h
Annual cost savings
Recurring expenditure
Net cost savings
Payback period
68/JNU OLE
At Steam Distribution Lines

30
6
7
Units
kg/h
kcal/h
lph
kL
`.lakhs
`.lakhs
`.lakhs
years
At Equipment
16
5
Savings achieved
60
40400
4.04
29
4.06
1.00
3.06
Immediate
Post audit was carried out in the same plant after two years. During the post audit, the steam trap survey indicated
that the trap management is poor and more than 15 traps are either malfunctioning or not working. This is because
no proper strategy was drawn and maintained.
Plant has implemented the measure immediately after the suggestion, but failed to continue the periodic follow up.
During the re-audit of the plant after two years, steam trap survey indicated that the traps condition is equally bad
when compared to the period of first audit. This is due to the lack of continuous monitoring and rectification.
The major causes for the non-implementation were:

Though the malfunctioning and not working traps were replaced initially, the task of assigning responsibility
of steam trap management for sustainability was not done.
No allotment of budget for steam trap management under the house keeping or maintenance or energy conservation
budget.
No strategic planning for periodic steam trap survey for identification of failures.
5.5.4 Use of Energy Efficient Ladle Preheating System

The energy efficient ladle preheating station is expected to yield energy savings to the tune of 10-15% by preheating
the combustion air and heating the ladle from outside by exit gases.
The mini steel plant has two ladle preheating stations for preheating the ladles before pouring the molten metal from
the melting furnace. Each ladle capacity is 20 MT. The energy balance of the ladle-preheating furnace indicated that
the flue gas losses accounted for 33% of the total heat input, which is quite high. The hourly consumption of HSD
in the ladles is 173 lph (147 kg/h).
In view of huge potential available in the exhaust gases, significant potential exists in recovering the heat in exhaust
gases. Latest ladle preheating stations are available (which are very simple in construction) with developed countries.
The units of this type are not domestically installed due to non-priority given to the ladle pre-heating system. In
the latest system, the combustion is preheated. After preheating the air, the flue gases heat the outer periphery of
the ladle.
Techno-economics:
Expected air preheat temperature:
Recoverable heat:
% heat recovery:

HSD savings:
Operating hours per year:
Annual HSD savings:
Cost savings:
Investment required:
Payback period:
400oC
190920 kcal/h
12.4% of heat input
21.3 lph
5000
106.5 kL
Rs 7.45 lakh/year
Rs 5.0 lakhs
8 months
The reasons for non-implementation were:

Plant personnel did not show any interest in ladle preheating since it is not considered as important operation
in the plant.
No manufacturer or suppliers of such efficient systems were domestically available.
Plant personnel, if want to implement the measure, it has to design or construct efficient ladle preheating station
with in house expertise.
69/JNU OLE
Summary

The characteristics of successful organisations are: top management support, better coordination of energy
manager and other departments through Energy Steering Committee, clear economic criteria for screening of
energy management projects, and awareness and motivation among the whole spectrum of operating staff.
Case studies on thermal energy management: control of excess air in fluidised bed combustion (fbc) boilers and
reaching out an optimal operating point, reduction in distribution losses in steam distribution lines by revamping
the insulation, refrigeration - speed reduction of chilling plant compressors saved energy, sugar industry - backpressure steam turbine and bagasse fired boiler, and chemical industry - heat recovery from exhaust gas in a
spray dryer.
Case studies on electrical energy management: optimising transformer loading, operation in star connection for
under loaded motors, replacement of pump impellers at a synthetic yarn plant, use of lighting voltage controller to
reduce lighting energy consumption, thermostat based operation of cooling tower fan, and automobile industry reciprocating engine system.
Barriers to successful implementation of energy saving projects: cost of energy is too small when compared
to production cost, non involvement or poor co-ordination among the inter-departments, lack of minimum
instrumentation, metering and monitoring, new technology application, lack of Communication to down stream
manpower etc.
Few cases which give the scenario where energy saving projects could not be implemented.
References

http://www.energymanagertraining.com/new_aboutcasestudies.php. Last accessed on 19th January, 2011.
http://www.energychange.info/casestudies/177-case-study-20-building-energy-audits-project. Last accessed

on 19th January, 2011.
http://www.bee-india.nic.in/content.php?page=energy_managers_auditors/guide_books.php. Last accessed on

19th January, 2011.
Recommended Reading

Wesley K. Foell (1979). Management of Energy/Environment Systems: Methods and Case Studies (International
series on applied systems analysis). John Wiley & Sons Ltd.
Michael Albanes (1978). An energy audit/case study: The May-D & F department store, Colorado Springs,
Colorado. Energy Conservation and Alternatives Centre for Commerce and Industry.
Richard Rogers (1979). An energy audit case study: The City Elite Laundry, Denver, Colorado. Energy
Conservation and Alternatives Centre for Commerce and Industry.
70/JNU OLE
Self Assessment
1. List at least five barriers for the energy savings projects.
2. The competitive advantage of reciprocating engines derives from their higher _____________efficiency.
a. mechanical
b. electrical
c. energy
d. system
3. What is the reason which is causing the leading players of the motor industry to focus on increasing various
ways and means to reduce the production cost?
a. Increasing competition
b. Increasing fuel cost
c. Increasing inflation
d. Increasing demand
4. _____________is often the biggest impedance in energy efficiency improvement projects.
a. Increasing fuel prices
b. Energy audit
c. Increasing competition
d. Resistance to change
5. State the reasons why the steam trap management was not followed periodically in a steam line plant.
6. The energy efficient ladle preheating station is expected to yield energy savings to the tune of ________by
preheating the combustion air and heating the ladle from outside by exit gases.
a. 20-25%
b. 10-15%
c. 5-10%
d. 15-20%
7. Why a leading home appliances manufacturing company could not implement soft starter on mechanical presses
for energy saving purpose?
8. What does CPP stands for?
a. Captive Preheating Plant
b. Company Power Plant
c. Captive Power Project
d. Captive Power Plant
a. The average age of the steam turbines and boilers is around eight years.
b. There is no provision for measurement of actual quantity of Bagasse being fired in the boilers.
c. The electric power generated in CPP is totally utilised to operate the process equipment.
d. During normal plant operations, the power generation is maintained at more than 20% of machine rating.
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10. _______consumption in reciprocating based power plant is the least among all cogeneration systems.
a. Auxiliary
b. Heat
c. Energy
d. Power
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Chapter VI
Project Planning
Aim

explain the concept of project
explain in-depth, the importance of technical design
explicate the role of project management
Objectives

explain the steps in project management
enlist four basic elements of project management
explain the importance of project management life cycle
Learning outcome

understand various project management techniques
know in-depth about project financing and contracting
describe the concept of performance monitoring
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6.1 Introduction to Production Management

Project management is the art of directing and coordinating human and material resources throughout the life of
a project by using modern management techniques to achieve predetermined objectives of scope, cost, time, and
quality and participation satisfaction.
Project management is concerned with the overall planning and co-ordination of a project from conception to
completion aimed at meeting the stated requirements and ensuring completion on time, within cost and to required
quality standards.
Project management is normally reserved for focused, non-repetitive, time-limited activities with some degree of
risk and that are beyond the usual scope of operational activities for which the organisation is responsible.
The basic ingredients for a project management framework may be represented schematically in fig. 6.1 below.
A working knowledge of general management and familiarity with the special knowledge domain related to
the project are indispensable.
Supporting disciplines such as computer science and decision science may also play an important role.
In fact, modern management practices and various special knowledge domains have absorbed various techniques
or tools, which were once identified only with the supporting disciplines
For example, computer-based information systems and decision support systems are now common-place tools for
general management. Similarly, many operations research techniques such as linear programming and network
analysis are now widely used in many knowledge or application domains.
General
management
Special
Knowledge
Domains
Project
Management
Supporting
disciplines
Fig. 6.1 Basic ingredients in project management

Steps in project management
The various steps in project management are:

project definition and scope
technical design
financing
contracting
implementation
performance monitoring
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6.2 Project Definition and Scope

A project is a one-shot, time-limited, goal-directed, major undertaking, requiring the commitment of varied skills
and resources.
A project is a temporary endeavour undertaken to create a unique product or service. A project is temporary in that
there is a defined start (the decision to proceed) and a defined end (the achievement of the goals and objectives).
Ongoing business or maintenance operations are not projects. Energy conservation projects and process improvement
efforts that result in better business processes or more efficient operations can be defined as projects. Projects usually
include constraints and risks regarding cost, schedule or performance outcome.
6.2.1 Four Basic Elements of Project Management
A successful Project Manager must simultaneously manage the four basic elements of a project: resources, time,
cost, and scope. Each element must be managed effectively. All these elements are interrelated and must be managed
together if the project, and the project manager, is to be a success.
Managing resources
A successful Project Manager must effectively manage the resources assigned to the project. This includes the labour
hours of the project team. It also includes managing labour subcontracts and vendors. Managing the people resources
means having the right people, with the right skills and the proper tools, in the right quantity at the right time.
However, managing project resources frequently involves more than people management. The project manager must
also manage the equipment (cranes, trucks and other heavy equipment) used for the project and the material (pipe,
insulation, computers, manuals) assigned to the project.
Managing time and schedule
Time management is a critical skill for any successful project manager. The most common cause of bloated project
budgets is lack of schedule management. Fortunately there is a lot of software on the market today to help you
manage your project schedule or timeline.
Any project can be broken down into a number of tasks that have to be performed. To prepare the project schedule,
the project manager has to figure out what the tasks are, how long they will take, what resources they require, and
in what order they should be done.
Managing costs
Often a Project Manager is evaluated on his or her ability to complete a project within budget. The costs include
estimated cost, actual cost and variability. Contingency cost takes into account influence of weather, suppliers and
design allowances.
6.2.2 Project Management Life Cycle
The process flow of Project management processes is shown in fig. 6.2. The various elements of project management
life cycle are:

Need identification
Initiation
Planning
Executing
Controlling
Closing out
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Need
Identified
Initiate
the Project
Plan
the Project
Execute
the Plan
Control
the Project
Closeout
the Project
Fig. 6.2 Process flow of a project management process

Need Identification
The first step in the project development cycle is to identify components of the project. Projects may be identified
both internally and externally:

Internal identification takes place when the energy manager identifies a package of energy saving opportunities
during the day-to-day energy management activities, or from facility audits.
External identification of energy savings can occur through systematic energy audits undertaken by a reputable
energy auditor or energy service company.
Initiation
Initiating is the basic processes that should be performed to get the project started. This starting point is critical
because those who will deliver the project, those who will use the project, and those who will have a stake in the
project need to reach an agreement on its initiation.
Planning
The planning phase is considered the most important phase in project management. Project planning defines project
activities that will be performed; the products that will be produced, and describes how these activities will be
accomplished and managed. Project planning defines each major task, estimates the time, resources and cost required,
and provides a framework for management review and control. Planning involves identifying and documenting
scope, tasks, schedules, cost, risk, quality, and staffing needs.
Executing
The execution phase is when the work activities of the project plan are executed, resulting in the completion of
the project deliverables and achievement of the project objective(s). This phase brings together all of the project
management disciplines, resulting in a product or service that will meet the project deliverable requirements and the
customers need. During this phase, elements completed in the planning phase are implemented, time is expanded,
and money is spent.
Controlling
Project Control function that involves comparing actual performance with planned performance and taking corrective
action to get the desired outcome when there are significant differences. By monitoring and measuring progress
regularly, identifying variances from plan, and taking corrective action if required, project control ensures that
project objectives are met.
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Closing out
Project closeout is performed after all defined project objectives have been met and the customer has formally
accepted the projects deliverables and end product or, in some instances, when a project has been cancelled or
terminated early. Although, project closeout is a routine process, it is an important one. By properly completing the
project closeout, organisations can benefit from lessons learned and information compiled. The project closeout
phase is comprised of contract closeout and administrative closure.
6.3 Technical Design

For a project to be taken up for investment, its proponent must present a sound technical feasibility study that
identifies the following components:

The proposed new technologies, process modifications, equipment replacements and other measures included
in the project. For example, consider the project idea of using a variable frequency drive (VFD) on the boiler
FD fan in place of damper control. The rating of the VFD, control methods (open loop or feedback control) and
if feedback control, what parameter is to be sensed (air pressure or % CO2 in flue gases etc) are key issues that
will have to be specified in this stage.
Product/technology/material supply chain (e.g., locally available, imported, reliability of supply)
Commercial viability of the complete package of measures (internal rate of return, net present value, cash flow,
average payback).
Any special technical complexities (installation, maintenance, repair), associated skills required.
Preliminary designs, including schematics, for all major equipment needed, along with design requirements,
manufacturers name and contact details, and capital cost estimate.
Organisational and management plan for implementation, including timetable, personnel requirements, staff
training, project engineering, and other logistics issues.
6.4 Financing
The project cost structure is vital before obtaining project financing. A project cost structure identifies the
following:

Amount of financing already secured: Current sources of capital/ company reserves
Investment required at each stage: This refers to the capital equipment cost payable during the implementation.
Advance payments, phased payments in instalments and payment on commissioning and testing etc are the
components of capital investment
Proposed investment structure (debt/equity): Large projects can be financed by obtaining capital from debt/
equity markets. The mix of debt and equity depends on the financial attractiveness of the project and ability of
repayments
Risk mechanisms (insurance, currency exposure, guarantees etc): Cost associated with insurance, risk of current
values especially for dollar denominated projects etc need to be considered
The discounted cash flow analysis such as NPV, IRR should be calculated on the basis of the project cost
structure
Some of the financing options available for Project funding are:

1. Internal funds

Capital introduced by the owner
Profits and cash flows generated by the business and retained within it
If the company has sufficient internal funds, we may want to consider self financing to avoid interest costs. Funds
might come from our annual budget or may be borrowed internally from enterprise accounts. We may also have
separate accounts for deferred maintenance or a reserve account that can supply short-term capital for projects. We
may be able to use funds from your operating budget. These accounts can be repaid from the project savings.
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Self-financing may be the lowest cost option for financing our energy project and has the following benefits:

funds are immediately available, allowing for quick project implementation and early realisation of the energy
cost saving benefits.
internal funds have no points, fees or other transaction costs associated with them.
2. Private sector

Commercial banks
Development corporations
Equipment vendors and subsidiary finance companies
Trade finance (suppliers and customers)
Equity
Private sector financing options include:

Long-term loans to purchase fixed assets: secured or unsecured
Short-term loans (including lines of credits without conditions on use)
Leasing
Equity (issue of shares/stock)
3. Government sector

Grants
Subsidies
Government-managed development funds
6.5 Contracting
Since a substantial portion of a project is typically executed through contracts, the proper management of contracts
is critical to the successful implementation of the project. In this context, the following should be done.

The competence and capability of all the contractors must be ensured. One weak link can affect the timely
performance of the contract.
Proper discipline must be enforced among contractors and suppliers by insisting that they should develop realistic
and detailed resource and time plans that are matching with the project plan.
Penalties may be imposed for failure to meet contractual obligations. Likewise, incentives may be offered for
good performance.
Help should be extended to contractors and suppliers when they have genuine problems.
Project authorities must retain independence to off-load contracts (partially or wholly) to other parties where
delays are anticipated.
If the project is to be implemented by an outside contractor, several types of contract may be used to undertake the
installation and commissioning:

Traditional contract: All project specifications are provided to a contractor who purchases and installs equipment
at cost plus a mark-up or fixed price.
Extended technical guarantee/service: The contractor offers extended guarantees on the performance of selected
equipment and / or service/maintenance agreements.
Extended financing terms: The contractor provides the option of an extended lease or other financing vehicle
in which the payment schedule can be based on the expected savings.
Guaranteed saving performance contract: All or part of savings is guaranteed by the contractor, and all or part
of the costs of equipment and/or services is paid down out of savings as they are achieved.
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Shared savings performance contract: The contractor provides the financing and is paid an agreed fraction of actual
savings as they are achieved. This payment is used to pay down the debt costs of equipment and/or services.
6.5.1 Recommendation for Scope of Work

The contractor shall work with the project manager and other design team members to complete the assigned
work.
For energy efficiency projects, the contractors assignment can include, but not be limited to, the following:

Kick-off Meeting: After the construction contract is signed, the contractor shall have a kick- off meeting with
the project manager, architect, mechanical engineer, electrical engineer, and other design team members as
specified by the facility. The purpose of this meeting is to:
introduce various parties,
discuss the responsibilities and roles of each party involved,
discuss a preliminary time schedule,
discuss any site-specific requirements for that facility
Schedule: The contractor shall prepare a detailed schedule for construction, installation, inspection, commissioning,
trial run, performance inspection, waste disposal, cleaning, training of operation and maintenance personnel, and
equipment/system turnover. The contractor shall submit this schedule to the project manager for approval.
Reporting: The contractor shall submit reports at a predetermined time interval, as determined by the project
manager. The reports shall include, but not be limited to, the following:
Construction progress reports
Installation reports
Inspection reports
Waste disposal reports
Commissioning reports
Trial run reports
Performance test reports
Change orders: The construction, installation, equipment specifications, inspections, commissioning, and
testing shall be according to the design document. Any change or deviation from the design document must be
preapproved by the project manager and engineer or architect.
Construction and installation: Construction and installation shall be according to the applicable codes and
standards. Wherever applicable, the work shall be performed by certified personnel. The project manager or his
designee can inspect any material, equipment, procedure, or method used at any time.
Inspection and testing: The contractor shall assist the owners inspector to conduct equipment, material,
construction and installation inspection. It is the responsibility of the contractor to ensure that the inspection
and testing is completed as specified in the contract and according to the project schedule. Construction and
installation shall not be deemed complete unless the required inspection and testing is completed. At the direction
of the project manager, the contractor will be required to conduct an inspection or testing and submit a report
to the project manager.
Commissioning: The project manager may hire an independent commissioning agent depending on the
complexity of the project. If commissioning is the responsibility of the contractor, the contractor shall prepare
a commissioning plan and schedule and submit them to the project manager for approval. The contractor shall
provide all the instrumentation and tools required for commissioning. The project manager or its designee
shall supervise the commissioning process and the pre-functional and functional tests for the specified energy
efficiency equipment. The contractor shall prepare a commissioning report and shall submit it to the project
manager for review and approval.
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Training: During the commissioning process the contractor shall start training the operations and maintenance
personnel. The training shall consist of classroom training, a facility walk through and actual staff involvement
during commissioning, performance inspection and trial run. The contractor shall ensure that the staff is capable
of properly operating, maintaining and handling emergency situations in an efficient and safe manner.
Trial run: The contractor shall complete the trial run as specified in the design document or as recommended
by the equipment manufacturer. The operating staff shall be involved during this process but the contractor
shall be responsible for any malfunction or operating errors. The contractor shall take readings of the operating
parameters, as recommended by the manufacturers, and shall submit these readings to the project manager for
review and approval.
Performance Testing: The project manager may hire an independent agent for this process, depending on the
complexity of the project. If the contractor is to conduct testing, the contractor shall provide all the instrumentation
and tools required for performance testing. The contractor shall prepare a test plan and schedule and provide
these to the project manager for review and approval. The project manager or its designee shall supervise the
performance testing process. The contractor shall prepare a performance test report and shall submit it to the
project manager for review. The contractor shall discuss the results of the tests with the project manager.
6.6 Implementation
Once the technical design, financing and contracting options are selected, the project should get approved by the
company and get implemented. The main problems faced by project manager during implementation are poor
monitoring of progress, not handling risks and poor cost management.

Poor monitoring of progress: Project managers some times tend to spend most of their time in planning activity
and surprisingly very less time in following up whether the implementation is following the plan. A proactive
report generated by project planner software can really help the project manager to know whether the tasks are
progressing as per the plan.
Not handling risks: Risks have an uncanny habit of appearing at the least expected time. In spite of the best
efforts of a project manager, they are bound to happen. Risks need immediate and focused attention. Delay in
dealing with risks causes the problems to aggravate and has negative consequences on the project.
Poor cost management: A project managers success is measured by the amount of cost optimisation done for a
project. Managers frequently do all the cost optimisation during the planning stages but fail to follow throughout
the rest of the stages of the project.
Project planning techniques

The three basic project planning techniques are Gantt chart, CPM and PERT. All monitor progress and costs against
resource budgets.
1. Gantt Chart
Gantt charts are also called Bar charts. The use of Gantt charts started during the industrial revolution of the late
1800s. An early industrial engineer named Henry Gantt developed these charts to improve factory efficiency.
Gantt chart is now commonly used for scheduling the tasks and tracking the progress of energy management
projects. Gantt charts are developed using bars to represent each task. The length of the bar shows how long
the task is expected to take to complete. Duration is easily shown on Gantt charts.
2. CPM - Critical Path Method
DuPont developed a Critical Path Method (CPM) designed to address the challenge of shutting down chemical
plants for maintenance and then restarting the plants once the maintenance had been completed. Complex projects,
require a series of activities, some of which must be performed sequentially and others that can be performed
in parallel with other activities. This collection of series and parallel tasks can be modelled as a network. CPM
models the activities and events of a project as a network. Activities are shown as nodes on the network and
events that signify the beginning or ending of activities are shown as arcs or lines between the nodes.
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3. PERT
The Program Evaluation and Review Technique (PERT) is a network model that allows for randomness in
activity completion times. PERT was developed in the late 1950s for the U.S. Navys Polaris project having
thousands of contractors. It has the potential to reduce both the time and cost required to complete a project.
PERT is typically represented as an activity on arc network, in which the activities are represented on the lines
and milestones on the nodes. The milestones generally are numbered so that the ending node of an activity has
a higher number than the beginning node. Incrementing the numbers by 10 allows for new ones to be inserted
without modifying the numbering of the entire diagram.
6.7 Performance Monitoring

Once the project is completed, performance review should be done periodically to compare actual performance with
projected performance. Feedback on project is useful in several ways:

It helps us to know how realistic were the assumptions underlying the project.
It provides a documented log of experience that is highly valuable in decision making in future projects.
It suggests corrective action to be taken in the light of actual performance.
It helps in uncovering judgmental biases.
It includes a desired caution among project sponsors.
Performance Indicators (PIs) are an effective way of communicating a projects benefits, usually as part of a
performance measuring and reporting process. Performance Indicators are available for a wide range of industries
and allow a measure of energy performance to be assigned to a process against which others can be judged.
Depending on the nature of the project, savings are determined using engineering calculations, or through metering
and monitoring, utility meter billing analysis, or computer simulations.
6.8 Measurement and Verification

A measurement and verification (M&V) plan is a set of agreed-upon metrics for an energy project that are used to
establish baseline performance as well as to verify actual energy savings. In other words, the M&V plan defines
precisely what energy savings mean for energy efficiency or energy conservation projects. In contractual
performance guarantee, M&V plans are particularly useful because they set clear, well-defined expectations between
the building owners and the energy service company (ESCO). M&V plans also help to increase the level of confidence
among financiers that an energy project will result in energy cost savings sufficient to fulfil debt obligations, which
can make it easier to secure outside financing.
Facility energy savings are determined by comparing the energy use before and after the installation of energy
conservation measures. The before case is called the baseline; the after case is referred to as the post-installation
or performance period. Proper determination of savings includes adjusting for changes that affect energy use but that
are not caused by the conservation measures. Such adjustments may account for differences in capacity utilisation,
raw material quality, product mix and other parameters, between the baseline and performance periods.
In general,
Savings = (Baseline Energy Use) adjusted - Post-Installation Energy Use
For example, in a paper mill, a variety of products depending on thickness (Grams per Square meter) are made. If
energy consumption is evaluated as kCals or kWh per tonne of paper, the figures could be misleading. Under these
circumstances the measurement and verification system is to be designed accounting for these variations.
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The four broad M&V options are:

Partially measured retrofit isolation - only the building systems upgraded or retrofitted are measured and verified.
Some of the parameters specified under the M&V plan are stipulated, that is, these parameters are given without
measuring to verify accuracy. Operating hours of equipment, for example, can be stipulated based on historical
data. However, the impact of potential errors made when stipulating parameters should not have a significant
impact on calculations of energy savings. In general, stipulation is cheaper than measurement.
Retrofit isolation - only the building systems upgraded or retrofit are measured and verified. No stipulation is
used. Measurements may be short-term or continuous throughout the post-retrofit period.
Whole facility - measurement is made at the whole building level. This option is best for cases where there is
a high degree of interaction between installed energy measures or between these measures and other building
systems. Measurements may be short-term or continuous throughout the post-retrofit period.
Calibrated simulation - savings are determined through simulation of energy use, either at the system level or
the whole building level. Simulations are calibrated with hourly or monthly utility billing data and/or end-use
metering. Because simulation routines must demonstrate adequate model accuracy of actual energy performance, a
considerable skill in calibrated simulations is required. This option is usually limited to cases where energy savings
cannot be isolated and where base year or post-retrofit data for the whole facility is missing or unreliable.
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Summary

Project management is the art of directing and coordinating human and material resources throughout the life
of a project by using modern management techniques to achieve predetermined objectives of scope, cost, time,
quality and participation satisfaction.
The various steps in project management are: project definition and scope, technical design, financing, contracting,
implementation, and performance monitoring.
A project is a one-shot, time-limited, goal-directed, major undertaking, requiring the commitment of varied
skills and resources.
A successful project manager must simultaneously manage the four basic elements of a project: resources, time,
cost, and scope.
The various elements of project management life cycle are: need identification, initiation, planning, executing,
controlling, closing out.
For a project to be taken up for investment, its proponent must present a sound technical feasibility study.
The project cost structure is vital before obtaining project financing. A project cost structure identifies: amount
of financing already secured, investment required at each stage, proposed investment structure (debt/equity),
risk mechanisms.
Since a substantial portion of a project is typically executed through contracts, the proper management of
contracts is critical to the successful implementation of the project.
Once the technical design, financing and contracting options are selected, the project should get approved by
the company and get implemented. The main problems faced by project manager during implementation are
poor monitoring of progress, not handling risks and poor cost management.
The three basic project planning techniques are Gantt chart, CPM and PERT. All monitor progress and costs
against resource budgets.
Gantt chart is now commonly used for scheduling the tasks and tracking the progress of energy management
projects. Gantt charts are developed using bars to represent each task.
DuPont developed a Critical Path Method (CPM) designed to address the challenge of shutting down chemical
plants for maintenance and then restarting the plants once the maintenance had been completed.
PERT is typically represented as an activity on arc network, in which the activities are represented on the lines
and milestones on the nodes.
Once the project is completed, performance review should be done periodically to compare actual performance
with projected performance.
A measurement and verification (M&V) plan is a set of agreed-upon metrics for an energy project that are used
to establish baseline performance as well as to verify actual energy savings.
References

http://www.bee-india.nic.in/energy_managers_auditors/documents/guide_books/1Ch7.pdf. Last accessed on

13th January, 2011.
http://www.scmwise.com/project-management-steps.html. Last accessed on 13th January, 2011.
http://www.avidbio.com/index.php?option=com_content&view=article&id=70&Itemid=84. Last accessed on

13th January, 2011.
Recommended Reading

Project Management Institute (2008). A Guide to the Project Management Body of Knowledge: (Pmbok Guide).
Project Management Institute; fourth edition.
Harold Kerzner (2009). Project Management: A Systems Approach to Planning, Scheduling, and Controlling.
Wiley; Tenth edition.
James P. Lewis (2006). Fundamentals of Project Management (Worksmart Series). AMACOM; Third edition.
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Self Assessment
1. The contractor providing financing is paid an agreed fraction of actual savings as they are achieved is called?
a. Traditional Contract
b. Extended Financing Terms
c. Shared Savings Performance Contract
d. Energy Service Contract
2. The technique used for scheduling the tasks and tracking of the progress of energy management projects is
called?
a. CPM
b. Gantt chart
c. CUSUM
d. PERT
3. For financing of projects, which type of government funding can be obtained?
a. Commercial banks
b. Equity
c. Leasing
d. Subsidies
4. The technique which suggests corrective action to be taken in the light of actual performance is_________.
a. CUSUM
b. PERT
c. Performance monitoring
d. CPM
5. The term Energy Services Contract in a project is under____________.
a. financing
b. contracting
c. monitoring
d. evaluation
6. Which of the following statement about project management is false?
a. A project is a permanent endeavour undertaken to create a unique product or service.
b. Projects usually include constraints and risks regarding cost, schedule or performance outcome.
c. The project cost structure is vital before obtaining project financing.
d. Project management is the art of directing and coordinating human and material resources throughout the
life of a project.
7. Which of the following type of contracting options has lowest risk?
a. Guaranteed savings contract
b. Shared savings performance contract
c. Extended technical guarantee and service
d. Traditional contract
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8. An effective way of communicating a projects benefit usually as a part of performance measuring and reporting
process is termed as________.
a.
b.
c.
d.
CPM
PERT
Performance indicator
Gantt chart
9. Formal project Close Out is necessary

a. on medium to large projects only
b. on all projects
c. only if a project has been terminated early
d. as part of post project appraisal
10. Which of the following is not a project planning technique?
a. CPM
b. PERT
c. Gantt chart
d. IRR (internal rate of return)
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Chapter VII
Energy Policy Planning and Implementation
Aim
The aim of the chapter is to:

explain the key elements in energy action planning
elucidate the concept of organising actions
explicate energy management system
Objectives

explain the management decision making tools namely: field force analysis and six thinking hats
analyse energy management system
explicate formulation, ratification and review of energy policy
Learning outcome

understand information system design
identify main barriers to the use of energy management information
describe the barriers to information system
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7.1 Introduction to Key Elements of Energy Management System

Good business leaders create a vision, articulate the vision, passionately own the vision and relentlessly drive it
to completion. - Jack Welch.
Energy efficiency is extremely important to all organisations, especially those that are energy intensive. The four
vital requirements for a successful energy management are shown in fig. 7.1.
Successful Energy Management
Technical
Ability
Monitoring
System
Strategy
plan
Top
management
Support
Fig. 7.1 The 4 pillars of successful energy management

Any successful energy management programme within an organisation needs the total support of top management.
Hence, top management support is the key requirement for success. Top management should give energy efficiency
equal importance in their corporate objectives as manpower, raw materials, production and sales. The other important
requirements are a well charted strategy plan, an effective monitoring system and adequate technical ability for
analysing and implementing energy saving options.
We can find many examples of effective energy managing organisations public, private, industrial, commercial,
institutional; in general, they are characterised by their:

providing leadership for energy management through a champion or group of committed staff
exhibiting a broad awareness of the benefits of energy efficiency throughout the organisation
integrating the task of managing energy into the overall management structure of the organisation by the creation
of appropriate business processes
having an energy management planshort term and long term
collecting and utilising information to manage their energy use
7.2 Management Decision Making Tools

Some of the management decision-making tools, which are useful in energy action planning, are explained
below.
7.2.1 Force Field Analysis
Force Field Analysis is a useful technique, developed by Kurt Lewin, for looking at all the forces for and against
a decision. Lewin saw organisations and situations as systems where some forces were trying to change the status
quo, and some forces were trying to maintain it.
In effect, it is a specialised method of weighing pros and cons. By carrying out the analysis you can plan to strengthen
the forces supporting a decision, and reduce the impact of opposition to it.
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How to use the tool

To carry out a force field analysis, follow these steps:
Step 1: List all forces for change in one column, and all forces against change in another column
Step 2: Assign a score to each force, from 1 (weak) to 5 (strong)
Step 3: Draw a diagram showing the forces for and against change. Show the size of each force as a number next
to it
Once we have carried out an analysis, we can decide whether your project is viable. In the steps above, we might
initially question whether it is worth going ahead with the plan.
Where we have already decided to carry out a project, Force Field Analysis can help us to work out how to improve
its probability of success. Here we have two choices:

To reduce the strength of the forces opposing a project
To increase the forces pushing a project
Often the most elegant solution is the first: just trying to force change through may cause its own problems. People
can be uncooperative if change is forced on them.
Example: One of the options for a steel works planning team looking to save future processing costs is whether to
consolidate the strip mill to a single site. To help identify the forces involved, they build a Force-Field Diagram,
as in the illustration.
During completion of the diagram, it was found that the most significant force was not the opposition from unions,
as was expected, but the political pressure. In a time of recession and shortly before elections, the government was
applying significant pressure not to close plants in areas of high unemployment. This, coupled with other consolidation
costs, gave sufficient reason for this initially attractive solution to be abandoned.
Consolidate strip
mill to single site
FOR
AGAINST
Union opposition
Competitive pressure
Restructuring cost
Budgetary objectives
Political pressure
Ease of administration
Increased transportation cost
No cheaper alternative
Opportunity cost
Improved efficiency
Fig. 7.2 Field force analysis

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7.2.2 Six Thinking Hats

This tool was created by Edward de Bono in his book 6 Thinking Hats. It is an important and powerful technique. It
is used to look at decisions from a number of important perspectives. This forces you to move outside your habitual
thinking style, and helps you to get a more rounded view of a situation.
Many successful people think from a very rational, positive viewpoint. This is part of the reason that they are
successful. Often, though, they may fail to look at a problem from an emotional, intuitive, creative or negative
viewpoint. This can mean that they underestimate resistance to plans, fail to make creative leaps and do not make
essential contingency plans. Similarly, pessimists may be excessively defensive, and more emotional people may
fail to look at decisions calmly and rationally. If you look at a problem with the Six Thinking Hats technique,
then you will solve it using all approaches. Your decisions and plans will mix ambition, skill in execution, public
sensitivity, creativity and good contingency planning.
How to use the tool
You can use Six Thinking Hats in meetings or on your own. In meetings it has the benefit of blocking the confrontations
that happen when people with different thinking styles discuss the same problem.
Each Thinking Hat is a different style of thinking. These are explained below:

White Hat: Collect the information you have, and see what you can learn from it. Look for gaps in your
knowledge, and either try to fill them or take account of them. This is where you analyse past trends, and try
to extrapolate from historical data.
Red Hat: Wearing the red hat, you look at problems using intuition, gut reaction, and emotion. Also try to
think how other people will react emotionally. Try to understand the responses of people who do not fully know
your reasoning.
Black Hat: Look at it cautiously and defensively. Try to see why it might not work. This is important because it
highlights the weak points in a plan. It allows you to eliminate them, alter them, or prepare contingency plans
to counter them. Black Hat thinking helps more resilient. It can also help you to spot fatal flaws and risks before
you embark on a course of action. Black Hat thinking is one of the real benefits of this technique, as many
successful people get so used to think positively that often they cannot see problems in advance. This leaves
them under-prepared for difficulties.
Yellow Hat: The yellow hat helps you to think positively. It is the optimistic viewpoint that helps you to see all
the benefits of the decision and the value in it. Yellow Hat thinking helps you to keep going when everything
looks gloomy and difficult.
Green Hat: The Green Hat stands for creativity. This is where you can develop creative solutions to a problem.
It is a freewheeling way of thinking, in which there is little criticism of ideas. A whole range of creativity tools
can help you here.
Blue Hat: The Blue Hat stands for process control. This is the hat worn by people chairing meetings. When
running into difficulties because ideas are running dry, they may direct activity into Green Hat thinking. When
contingency plans are needed, they will ask for Black Hat thinking, etc. A variant of this technique is to look
at problems from the point of view of different professionals (e.g. doctors, architects, sales directors, etc.) or
different customers.
Example: The directors of a property company are looking at whether they should construct a new office building.
The economy is doing well, and the amount of vacant office space is reducing sharply. As part of their decision they
decide to use the Six Thinking Hats technique during a planning meeting.
Looking at the problem with the White Hat, they analyse the data they have. They examine the trend in vacant
office space, which shows a sharp reduction. They anticipate that by the time the office block would be completed,
that there will be a severe shortage of office space. Current government projections show steady economic growth
for at least the construction period.
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With Red Hat thinking, some of the directors think the proposed building looks quite ugly. While it would be highly
cost-effective, they worry that people would not like to work in it.
When they think with the Black Hat, they worry that government projections may be wrong. The economy may be
about to enter a cyclical downturn, in which case the office building may be empty for a long time. If the building
is not attractive, then companies will choose to work in another better-looking building at the same rent.
With the Yellow Hat, however, if the economy holds up and their projections are correct, the company stands to
make a great deal of money. If they are lucky, may be they could sell the building before the next downturn, or rent
to tenants on long-term leases that will last through any recession.
With Green Hat thinking they consider whether they should change the design to make the building more pleasant.
Perhaps they could build prestige offices that people would want to rent in any economic climate. Alternatively,
maybe they should invest the money in the short term to buy up property at a low cost when a recession comes.
The Blue Hat has been used by the meetings Chair to move between the different thinking styles. He or she might
have to keep other members of the team from switching styles, or from criticising other peoples points.
Six thinking hat technique opens up the opportunity for creativity within Decision Making. The technique also helps,
for example, persistently pessimistic people to be positive and creative.
7.3 Energy Management System

Organisations seeking financial returns from superior energy management continuously strive to improve their
energy performance. Their success is based on regularly assessing energy performance, planning and implementing
action plans to improve energy efficiency. Hence a sound energy management system is a prerequisite for identifying
and implementing energy conservation measures, sustaining the momentum and for effecting improvements on a
continuous basis. The various steps for energy action planning are shown in fig. 7.3.
Make Commitment
Assess Perfermance
& Set Goals
Re - Assess
Create
Action Plan
Implement
Action Plan
Recognise
Actievements
Evaluatse
Progress
Fig. 7.3 Steps in energy action planning
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7.3.1 Top Management Commitment and Support

Top management shall make a commitment to allocate manpower and funds to achieve continuous improvement.
To establish the energy management programme, leading organisations appoint energy manager, form a dedicated
energy team and institute an energy policy.
Appoint an energy manager
The tasks of energy manger are setting goals, tracking progress, and promoting the energy management program.
An Energy Manager helps an organisation achieve its goals by establishing energy performance as a core value.
The Energy Manager is not always an expert in energy and technical systems. Successful Energy Manager understands
how energy management helps the organisation achieve its financial and environmental goals and objectives.
Depending on the size of the organisation, the Energy Manager role can be a full-time position or an addition to
other responsibilities.
An energy manager is responsible for facilitating and coordinating the planning, procurement and utilisation of energy
resources at a property, facility, or portfolio of properties. In some organisations, the energy manager is a fulltime,
dedicated position whose responsibilities might encompass a single building or a whole portfolio of properties. In
others, energy management is just one part of the responsibilities of a facility or property manager.
The energy manager carefully analyses a companys potential for investment, articulates findings and recommendations
to company decision makers, oversees implementation of ECMs and EEMs, and then tracks and quantifies results
stemming from the energy management programme. In doing so, successful energy managers depend on their
relationships with co-workers, such as building staff, business managers and company executives, as well as external
partners, such as vendors, contractors, energy service providers and the local utilities.
Roles and responsibilities of energy manager
Your tasks and responsibilities as energy manager are clearly wide ranging and may even vary over time as energy
management becomes established. It may be helpful therefore to provide a sample job description for the role of
energy manager.
The designated energy manager should have the following roles:

Development of energy policy and energy management action plan.
Coordination of day-to-day energy management.
Performance of monitoring and benchmarking activities.
Reporting of energy management action plan progress and achievements.
Promotion of energy awareness and development of staff motivation.
Liaison with gatekeepers and other key stakeholders to ensure acceptance of energy policy and action plan.
Coordination of the identification and evaluation of energy efficiency opportunities.
Preparation of investment plans for energy efficiency
Coordination of the implementation of the energy efficiency investment plan.
Staff education in energy efficient operating practices.
Monitoring and reporting the integrated energy/energy management budget.
Form A Dedicated Energy Team

The tasks of energy team are executing energy management activities across different parts of the organisation and
ensuring integration of best practices.
Energy team can encourage communications and the sharing of ideas between various departments in an organisation.
It can serve to obtain agreements on energy conservation projects, which affect more than one department. It can
provide a stronger voice to the top management than a single energy manager normally could. The composition of
the energy team will vary from one organisation to another, depending on the existing management structure, the
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type and quantity of energy used and other company-specific factors. Atypical example of organisational structure
of an energy management and location of an energy manager are shown in Fig. 7.4.
Organisational structure of Energy

Management
Plant Management
Energy Management
Division
Manufacturing
Section - 1
Energy manager
Nodal officials from

each department
Other Sections
Acctts, HRD
Expansion, R&D, etc.
Manufacturing
Section - 2
Shop manager
Nodal officials from
EM
Fig. 7.4 Organisation structure of energy management

The energy team should have the following roles:

Vetting, approval and review of the energy management action plan.
Resolution of problems in the day-to-day operation of the plan that cannot be directly resolved by the energy
manager.
Review of the energy managers performance.
Evaluation and approval of quarterly reports.
Provision of support to the energy manager to carry out components of the energy management action plan that
require additional support from external consultants/contractors, or from within the organisation.
Vetting of energy managers recommendations and recommendation to senior management for approval.
Controlling and reporting the integrated energy/energy management budget.
Institute an energy policy

Energy policy provides the foundation for setting performance goals and integrating energy management into an
organisations culture and operations.
Energy Policy provides the foundation for successful energy management. It formalizes top managements support
and articulates the organisations commitment to energy efficiency for employees, shareholders, the community
and other stakeholders.
A formal written energy policy acts both as:

A public expression of the organisations commitment to energy conservation and environmental protection
A working document to guide the energy management practices and provides continuity.
It is in the companys best interest that support for energy management is expressed in a formal written declaration
of commitment accompanied by a set of stated objectives, an action plan for achieving them, and a clear specification
of responsibilities.
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Typical format of an energy policy

Declaration of top managements commitment to, and senior and middle managements involvement in, energy
management.
Statement of policy.
Statement of objectives, separated into short and long-term goals.
Actions

Have the CEO or head of the organisation officially issue the policy
Involve key people in policy development to ensure cooperation
Tailor the policy to the organisations culture
Make it understandable to employees and public alike
Consider the skills and abilities of management and employees
Include detail that covers day-to-day operations
Communicate the policy to all employees, and encourage them to get involved
Seeking support
Each of the policy documents requires a different level of endorsement. As its name implies, the chairmans
statement needs to be signed at the highest level by the chairman, MD or chief executive. The corporate policy
statement needs the full endorsement of the board. Depending on the corporate culture, we may also want to seek
wider support. Since it is intended for public circulation, it may need input from our marketing, public relations, or
publications departments, if we have them.
Getting policy endorsed
Regardless of the corporate culture, it is important to get the policy adopted and endorsed. How we should go about
getting it adopted, and whose endorsement is necessary, varies from culture to culture.
Operating formally to ensure that policy is adopted via the correct channels and proper procedures is important
in hierarchic organisations but less so elsewhere. Ensuring that policy is formally endorsed by the board is essential
in hierarchic and market organisations, but formal endorsement at this level alone is not enough in the market
organisation. Here, acceptance by middle managers, who are expected to put policy into practice, is equally necessary.
In a team culture, adoption and endorsement may need to be sanctioned by general agreement, but it is not always
necessary to do this formally.
7.3.2 Reviewing Performance
Once its policy is in place, the organisation needs to check periodically on what progress is being made towards
meeting goals and objectives and achieving targets. The intervals at which these checks are made should be spelt
out in her in house delivery system document. So too should the procedures to be used for making them.
Key aspects include data collection and management, establishing baseline, benchmarking, analysis and evaluation
and conducting technical assessment and audit.
There are three different types of check your organisation can make. It is helpful to keep them clearly separate by
labelling them as:

monitoring
reviewing
auditing
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Each of these:

operates over a different time-scale
has a distinct purpose
is (ideally) undertaken by different people
Once an energy policy has been adopted, craft an action plan that allows the company to achieve its energy goals
and objectives. The energy action plan will be a roadmap for continuous improvement, providing concrete steps
for moving forward.
Typically an energy action plan is created after an energy audit has identified areas of potential improvement. Most
energy audits include recommendations about the benefits and timing of potential energy projects; these will need
to be evaluated by company decision makers to determine which projects fit internal investment criteria. The energy
team can then assign specific tasks to its members, both in-house and outside consultants. If critical actions are
being carried out by consultants, then the energy team should design a measurement and verification (M&V) plan
for evaluating results.
Regular meetings of the energy team help to assess progress and keep focus on action items. Depending on the scope
of the energy programme and the size of the company, it may make sense to create incremental performance targets
for specific facilities or departments to ensure that each unit of the company is making adequate progress.
Let employees, tenants and customers know about the energy policy and action plan and ask for their help in
achieving goals. Raising awareness and encouraging behavioural change can have a major impact on energy savings
in addition to reflecting well on the companys reputation.
Data Collection and Management
Collect and track data -Collect energy use information and document data over time. Evaluating energy performance
requires good information on how, when, and where energy is being used. Collecting and tracking this information
is necessary for establishing baselines and managing energy use.
The following steps are to be considered:
a) Collect data
The data must be complete and accurate because it will be used for analysis and goal setting. Consider the following
when collecting energy use data:

Determine appropriate level of detail -The level and scope of data collection will vary from organisation to
organisation. Some may choose to collect data from submeters on individual processes while others may only
look at a utility bill.
Account for all energy sources - Make inventory of all energy purchased and generated onsite (electricity, gas,
steam, waste fuels) in physical units (kWh, kg of steam, etc.) and on a cost basis.
Document all energy uses -For the sources identified above, assemble energy bills, meter readings, and other
use data. Energy data may reside in the accounting department, be held centrally or at each facility, or can be
acquired by contacting the appropriate utilities or energy service providers. Gather at least two years of monthly
data or a more frequent interval if available. Use the most recent data available.
Collect facility and operational data -To be able to normalise and benchmark, it may be necessary to collect nonenergy related data for all facilities and operations, such as building size, production, operating hours, etc.
b) Track data
A system for tracking performance can range from a simple spreadsheet to detailed databases and IT systems. In
developing an appropriate tracking system for the organisation, consider the following:

Scope -The design of the tracking system will be shaped, in large part, by the level and scope of information
that will be tracked and the frequency of data collection.
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Maintenance -Tracking systems must be easy to use, update, and maintain.
Reporting and communicating -Use tracking systems to communicate energy performance to other parts of the
organisation and motivate change. Consider developing formats that express energy performance information
in ways that are easily understandable across the organisation. A good tracking system should make such
reporting easy.
Actions
Collect data by fuel type at an individual building or facility level
Collect data from sub-meters, if possible
Use data that is current and timely
Use tracking systems to develop quarterly and annual reports that profile energy performance
Use tracking systems to allow facilities to compare their performance to their peers
c) Normalise data
The energy use of facilities varies greatly, partly due to factors beyond the energy efficiency of the equipment and
operations. These factors may include weather or certain operating characteristics. Normalising is the process of
removing the impact of various factors on energy use so that energy performance of facilities and operations can
be compared.
In order to normalise:

Determine normalisation factors-Determine key factors that need to be addressed to effectively compare facilities.
Relevant factors are frequently organisation-specific. For industrial facilities common normalisation factors
include:
Inputs
Product type
Output
Production processes
For commercial and institutional buildings, common normalisation factors include:

Climate zone
Facility size
Fuel choice
Price/cost of energy
Actual weather history
Hours of operation
Occupancy levels
Special features

Establishing baseline
Establish baselines-Determine the starting point from which to measure progress.
Measuring energy performance at a specific time establishes a baseline and provides the starting point for
setting goals and evaluating future efforts and overall performance. Baselines should be established for all
levels appropriate to your organisation.
The main steps involve using the data collected so far to:
Establish base year-Establish a base year or an average of several historical years. Use the most complete
and relevant sets of data available.
Identify metrics-Select units of measurements that effectively and appropriately express energy performance
for the organisation. (e.g. kCal/ton, kCal/kWh, total energy cost/ton).
Publish results-Announce performance baselines to facilities, managers, and other key stakeholders in your
organisation.
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Benchmark
Compare the energy performance of facilities to each other, peers and competitors, and over time to prioritise
which facilities to focus on for improvements. Benchmarking allows us to compare the energy performance of
similar facilities or an established level of performance. It is a useful activity in energy management because it
can be used to develop relative measures of energy performance, track change over time, and identify best energy
management practices. Benchmarking can be done in variety of ways. Facility or organisational performance may
be benchmarked to:
Past performance-A comparison of current versus historical performance.
Industry average-Based on an established performance metric, such as the recognised average performance of a
similar group.
Best in class-Benchmarking against the best in the industry and not the average.
Best Practices-A qualitative comparison against certain, established practices considered to be the best in the
industry.
The key steps in benchmarking include:

Determining the level of benchmarking (for example -equipment, process line, facility or organisational)
Developing metrics
Conducting comparisons
Tracking performance over time
Analysis and evaluation

Analyse data to understand your energy use patterns and trends.
Analysing data to determine energy use trends can help an organisation gain a better understanding of the factors that
affect energy performance and identify steps for reducing energy consumption. Assessing your energy performance
helps you to:
categorise current energy use by fuel type, operating division, facility, product line, etc.
identify high performing facilities for recognition and reuse of best practices
prioritise poor performing facilities for immediate improvement
understand the contribution of energy expenditures to operating costs
develop a historical perspective and context for future actions and decisions
establish reference points for measuring and rewarding good performance
There are a variety of ways by which data can be analyzed depending upon the needs of the organisation. The
following analyses provide a guideline:
a) Quantitative reviews

Develop use profiles-Identify energy consumption peaks and valleys, and determine how they relate to operations
or key events.
Compare performance-Compare the use and performance data of similar facilities in your industry.
Assess the financial impacts-Identify areas of high-cost energy use.
Identify data gaps-Determine areas where more information is needed.
b) Qualitative reviews

Conduct interviews-Seek informed opinions from colleagues, lessons learned, systems- specific information
(e.g., HVAC, lighting, refrigeration), and in-house audits or surveys.
Review policies and procedures-Review organisational policies and operating procedures to determine their
impact on energy use.
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Conduct technical assessments & audits

Evaluate the operating performance of facility systems and equipment to determine improvement potential Knowing
the organisations baseline energy use and the relative performance of entire portfolio is only part of the information
needed. Periodic assessment of the performance of equipment, processes, and systems will help to identify
opportunities for improvement. Energy audits are comprehensive reviews conducted by energy auditors and/or
engineers that evaluate the actual performance of a facilitys systems and equipment against its designed performance
level or against best available technology. The difference between these is the potential for energy savings.
The main steps for conducting technical assessments and audits are:

Assemble audit team-Expertise should cover all energy-using systems, processes, and equipment. Include
facility engineers, system specialists, and other support. Outside support may be helpful and provide an objective
perspective or specific expertise.
Plan and develop an audit strategy-Identify and prioritise systems for evaluation, assign team members to tasks,
and schedule completion dates for the activities. Use benchmarking results to identify poor-performing facilities
whose equipment and systems should be targeted for evaluation.
Create audit report-Based on the audit results, produce a detailed summary of actual steps that can be taken
to reduce energy use. The report should recommend actions ranging from simple adjustments in operation to
equipment replacement. Estimates of resource requirements for completing actions should also be included.
7.3.3 Set Goals

Performance goals drive energy management activities and promote continuous improvement. Setting clear
and measurable goals is critical for understanding intended results, developing effective strategies, and reaping
financial gains. Well-stated goals guide daily decision-making and are the basis for tracking and measuring
progress. Communicating and posting goals can motivate staff to support energy management efforts throughout
the organisation. The Energy Manager in association with the energy team typically develops goals.
Setting goals helps the energy manager:

set the tone for improvement throughout the organisation
measure the success of the energy management program
help the energy team to identify progress and setbacks at a facility level
foster ownership of energy management, creates a sense of purpose, and motivates staff
demonstrate commitment to reducing environmental impacts
create schedules for upgrade activities and identify milestones
tool called force field analysis can be used to clarify the goals to be achieved
To develop effective performance goals, determine scope, estimate potential for improvement and finally establish
goals.
7.3.4 Create Action Plan
With goals in place, the organisation is now ready to develop a roadmap to improve energy performance.
Successful organisations use a detailed action plan to ensure a systematic process to implement energy performance
measures. Unlike the energy policy, the action plan is regularly updated, most often on an annual basis, to reflect
recent achievements, changes in performance, and shifting priorities.
While the scope and scale of the action plan is often dependent on the organisation, the steps below outline a basic
starting point for creating a plan.
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Define technical steps and targets

Evaluate technical assessments and audit results
Determine technical steps
Create performance targets
Set timelines
Establish a tracking
Determine roles and resources

Identify internal roles
Identify external roles
Establish performance metrics for contractors
Determine resources
Define resources need
Secure resources
Actions
7.3.5 Implement Action Plan

People can make or break an energy program. Gaining the support and cooperation of key people at different
levels within the organisation is an important factor for successful implementation of the action plan in many
organisations.
Reaching your goals frequently depends on the awareness, commitment, and capability of the people who will
implement the projects defined in the action plan. In addition to implementing the technical aspects of the action
plan, consider the following:

Create communication plan-Develop targeted information for key audiences about your energy management
program.
Good communication does not just happen. It requires careful planning and implementation. To communicate
strategically, you will need to identify key audiences, determine the information that they need, and adapt your
messages appropriately for each one.
Raise awareness-Build support at all levels of your organisation for energy management initiatives and goals.
Increase general energy awareness
Improve facility energy awareness
Gain Management support
Build capacity-Through training, access to information, and transfer of successful practices, procedures, and
technologies, you can expand the capacity of your staff.
Investing in training and systems to share successful practices helps ensure the success of the action plan by
building the overall organisational capacity. Many organisations have found that informed employees are more
likely to contribute ideas, operate equipment properly, and follow procedures, helping to guarantee that capital
investments in energy improvements will realise their potential.
Motivate-Create incentives that encourage staff to improve energy performance to achieve goals.
Offering incentives for energy management is one way many organisations create interest in energy initiatives
and foster a sense of ownership among employees.
Examples of how organisations motivate staff and employees include:
Internal competition: Use tracking sheets, scorecards, etc. to compare performance of similar facilities and
foster a sense of competition.
Recognition: Highlight and reward accomplishments of individuals, departments, and facilities.
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Financial bonus and prizes: Offer cash bonuses and other rewards if goals are met.
Environmental responsibility: Use environmental messages to promote a sense of environmental and social
responsibility.
Financial responsibility: Use financial messages to promote a sense of fiduciary responsibility.
Performance standards: Tie employee performance standards to energy goals.

Track and monitor-Using the tracking system developed as part of the action plan to track and monitor progress
regularly. A tracking system is the means by which an energy programs activities are monitored. The system
should be centralised and available for all to use in gauging progress toward established targets, milestones, and
deadlines. Maintaining a tracking system enables you to assess necessary steps, corrective actions, and identify
successes. Periodic review of the activities outlined in the action plan is critical to meet energy performance
goals.
Perform regular updates
Conduct periodic reviews
Identify necessary corrective action
7.3.6 Evaluate Progress

Evaluating progress includes formal review of both energy use data and the activities carried out as part of the action
plan as compared to your performance goals.
Key aspects are measuring results and reviewing action plans.

Measure results
Compare current performance to established goals. Gather energy use data and compare results to goals to
determine accomplishments.
Key steps in measuring results include:

Gather tracking data
Benchmark

Review action plan

Understand what worked well and what didnt in order to identify best practices.
After reviewing performance data, the next steps are to understand the factors affecting the results as well as
the additional benefits of the improved energy performance.
Regular evaluation of energy performance and the effectiveness of energy management initiatives also allow
energy managers to:
Measure the effectiveness of projects and programs implemented
Make informed decisions about future energy projects
Reward individuals and teams for accomplishments
Document additional savings opportunities as well as non-quantifiable benefits that can be leveraged for
future initiatives.
This review should look at the effectiveness of your action plan. Where activities and projects were successful,
document best practices to share throughout the organisation.
Where goals were not met, many organisations determine the cause and decide what corrective or preventive actions
should be taken.
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Key steps in reviewing the action plan include:

Get feedback
Assess awareness
Identify critical factors
Quantify side benefits
7.3.7 Recognise Achievements
Providing and seeking recognition for energy management achievements is a proven step for sustaining momentum
and support for your program.
Providing recognition to those who helped the organisation achieve these results motivates staff and employees and
brings positive exposure to the energy management program.
Receiving recognition from outside sources validates the importance of the energy management program to both
internal and external stakeholders, and provides positive exposure for the organisation as a whole.
a) Internal recognition
Recognising the accomplishments of individuals and teams is the key to sustaining support and momentum for
energy management initiatives. Rewarding particular efforts sets the example for what constitutes success and helps
motivate employees through increased job satisfaction. Recognition can strengthen the morale of everyone involved
in energy management.
Key steps are:

Determine recognition levels-The decision about who should receive recognition in your organisation will
likely be shaped by the purpose for providing recognition and your organisational culture. Common recognition
levels include:
Individual-Acknowledges the contributions and accomplishments of specific people.
Teams-Recognises the achievements of teams, departments, and other distinct groups within the
organisation.
Facility-Rewards the accomplishments or performance of an entire facility.
Establish recognition criteria-Create criteria for recognition and communicate these criteria and any process
eligibility requirements.
Determine recognition type

There are a variety of ways to provide recognition and rewards. Depending on the purpose of the recognition program
and your organisational culture, forms of recognition can range from formal acknowledgements and certificates, to
salary increases and cash bonuses, to simple forms of appreciation such as shields or energy program shirts.
b) External recognition
Good work deserves to be acknowledged. Recognition from a third party can provide validation for an organisations
energy management program. Not only does it provide satisfaction to those involved in earning the recognition, but
it can also enhance an organisations public image. A solid reputation contributes to your competitive advantage by
making your organisation more attractive to customers, students, current and potential employees, lenders, business
partners and other stakeholders.
7.4 Information Systems

Good information is indispensable for effective energy management. But conventional financial accounts do not
make visible the benefits of energy management. Most organisations examine the aggregate expenditure and revenue
related to each part of the businessthey are interested in the bottom line or how much of a profit or loss each
department is making. This is a main reason why energy managers have had difficulty in the past in maintaining
senior management interest and commitment.
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Designing a good information system involves considering the whole process of adequate data input, sensible analysis
and appropriate reporting. Until recently, energy information systems have predominately been discussed in terms
of the hardware and software specifications for monitoring and targeting systems. Now much more concern is given
to find out what information end-users of such systems need and to design interfaces that are user-friendly.
The principal objective of an EMIS is to support an organisations energy management programme. Its specific
deliverables are as follows:

early detection of poor performance
support for decision making
effective performance reporting
auditing of historical operations
identification and justification of energy projects
evidence of success
support for energy budgeting and management accounting
energy data to other systems
7.4.1 Barriers
The main barriers to the use of energy management information are:
Managerial

energy management is marginalised as a technical specialty
line management is inadequate
there is insufficient interest and driving force from above
there is little incentive for departmental managers and general staff to save energy
Technical

getting accurate data on time is a key problem
monitoring and targeting is not integrated with financial accounting
output is not reported to either users or senior managers in a form they can readily understand and use.
Getting the most out of your system

The key things you need to keep in mind when developing an effective energy management information system
are:

decide who will use the information and involve them in making a realistic assessment of their needs
keep data input and analysis as simple as possible compatible with achieving your aims
ensure that the output motivates people to use energy efficiently
justify the expense of running the system to senior management
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Summary

Organisations seeking financial returns from superior energy management continuously strive to improve
their energy performance. Their success is based on regularly assessing energy performance, planning and
implementing action plans to improve energy efficiency.
A sound energy management system is a prerequisite for identifying and implementing energy conservation
measures, sustaining the momentum and for effecting improvements on a continuous basis.
Force Field Analysis is a useful technique, where after the analysis we can plan to strengthen the forces supporting
a decision, and reduce the impact of opposition to it.
Six thinking hats tool is used to look at decisions from a number of important perspectives. This forces us to
move outside your habitual thinking style, and helps to get a more rounded view of a situation.
To establish the energy management programme, leading organisations should appoint energy manager, form
a dedicated energy team and institute an energy policy.
Setting clear and measurable goals is critical for understanding intended results, developing effective strategies,
and reaping financial gains.
Successful organisations use a detailed action plan to ensure a systematic process to implement energy
performance measures.
Gaining the support and cooperation of key people at different levels within the organisation is an important
factor for successful implementation of the action plan in many organisations.
Evaluating progress includes formal review of both energy use data and the activities carried out as part of the
action plan as compared to your performance goals.
Providing and seeking recognition for energy management achievements is a proven step for sustaining
momentum and support for the program.
Good information is indispensable for effective energy management. Designing a good information system
involves considering the whole process of adequate data input, sensible analysis and appropriate reporting.
References


16th January, 2011.
http://www.iiec.org/dmdocuments/energy_efficiency_policy_planning_India_RajaKumar_BESCOM_15jun07.
pdf. Last accessed on 16th January, 2011.
http://www.google.co.in/search?q=Energy+Policy+Planning&hl=en&biw=1229&bih=520&prmd=ivns&sour
ce=univ&tbs=vid:1&tbo=u&ei=N4o2Td3_EMzXcb6n9MYB&sa=X&oi=video_result_group&ct=title&resn
um=5&ved=0CEwQqwQwBA. Last accessed on 16th January, 2011.
Recommended Reading

John Randolph PhD (2008). Energy for Sustainability: Technology, Planning, Policy. Island Press; first
edition.
John Byrne (1989). Planning for Changing Energy Conditions (Energy Policy Studies, Volume 4). Transaction
Publishers.
Frank J. Convery (1999). A Guide to Policies for Energy Conservation: The European Experience. Edward
Elgar Publishing.
102/JNU OLE
Self Assessment
1. The force field analysis in energy action planning deals with barriers having__________.
a. positive forces only
b. negative forces only
c. both negative and positive forces
d. no forces
2. The location of energy manger in a large organisation could be
a. marketing division
b. plant maintenance unit
c. finance division
d. corporate management services department
3. A public expression of organisations commitment to energy conservation and environmental protection is
called _________________.
a. company policy
b. energy policy
c. management philosophy
d. corporate plan
4. Which one of them is a positive force towards achieving goal of reduced energy consumption?
a. Tax on energy consumption
b. Competing corporate priorities
c. Insufficient financial resources to fund
d. Absence of corporate energy policy
5. A tracking system is the means by which a _________programs activities are monitored.
a. office
b. energy
c. committee
d. management
6. What does Red Hat signifies in six thinking hats tools?
a. It looks at the situation cautiously and defensively
b. It helps you to think positively
c. This is where you can develop creative solutions to a problem
d. It looks at problems using intuition, gut reaction, and emotion
a. Recognition can strengthen the morale of everyone involved in energy management.
b. Maintaining a tracking system enables you to assess necessary steps, corrective actions, and identify
successes
c. Successful organisations use a detailed action plan to ensure a systematic process to implement energy
performance measures
d. Performance goals drive energy management activities and promote one time improvement
103/JNU OLE
8. The principal objective of an ________is to support an organisations energy management programme.

a. EMIS
b. MEIS
c. SEIM
d. PEIS
9. ____________allows us to compare the energy performance of similar facilities or an established level of
performance.
a. Management
b. Benchmarking
c. Tracking system
d. Information system
10. ________provides the foundation for setting performance goals and integrating energy management into an
organisations culture and operations.
a. Energy manager
b. Energy policy
c. Energy committee
d. Energy audit
104/JNU OLE
Case Study I
(The CUSUM Technique)
Problem: Energy consumption and production data were collected for a plant over a period of 18 months. During
month 9, a heat recovery system was installed. Using the plant monthly data, estimate the savings made with the
heat recovery system. The plant data is given in Table:
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
Eact Monthly Energy Use

(toe * / month)
340
340
380
380
300
400
280
424
420
400
360
320
340
372
380
280
280
P Monthly Production
(tonnes / month)
380
440
460
520
320
520
240
620
600
560
440
360
420
480
540
280
260
18
380
500
Month
Month wise production and energy consumption

* Toe = tonnes of oil equivalent.
Solution: Steps for CUSUM analysis
1. Plot the Energy - Production graph for the first 9 months
2. Draw the best fit straight line
3. Derive the equation of the line
The above steps are completed in the graph below, the equation derived is E = 0.4 P + 180
105/JNU OLE
500
450
Energy ( toe/month)
400
350
300
250
Ec alc= 0.4 + 180
200
150
100
50
0
P-Production ( t/month)
Energy production graph
4. Calculate the expected energy consumption based on the equation

5. Calculate the difference between actual and calculated energy use
6. Compute CUSUM
Eact- Actual Energy consumption
Ecalc - Calculated energy consumption
These steps are shown in the Table below
Eact - Ecalc
CUSUM
(Cumulative
Sum)
332
+8
+8
440
356
-16
-8
380
460
364
+16
+8
380
520
388
-8
300
320
308
-8
-8
400
520
388
+2
-6
280
240
276
+4
-2
424
620
428
-4
-6
420
600
420
-6
10
400
560
404
-10
11
360
440
356
+4
-6
12
320
360
324
-4
-10
13
340
420
348
-8
-18
14
372
480
372
-18
15
380
540
396
-16
-34
16
280
280
292
-12
-46
17
280
260
284
-4
-50
18
380
500
380
-50
Month
Eact
340
380
340
Ecalc
(0.4P + 180)
Cusum
106/JNU OLE
7. Plot the CUSUM graph.

8. Estimate the savings accumulated from use of the heat recovery system.
20
10
-0
1
9 10 11 12 13 14 15 16 17 18
CUSUM
-10
-20
-30
-40
-50
-60
Months
CUSUM chart
CUSUM chart for last 18 months is shown in the graph above.
From the graph above, it can be seen that the CUSUM graph oscillates around the zero line for several months and
then drops sharply after month 11. This suggests that the heat recovery system took almost two months to commission
and reach proper operating conditions, after which steady savings have been achieved. Based on the graph (see
Table CUSUM) savings of 44 toe (50-6) have been accumulated in the last 7 months. This represents savings of
almost 2% of energy consumption.
#Eact for the last 7 months (from month 12 to month 18 in Table above)
107/JNU OLE
Case Study II
Successful Energy Monitoring Program and Implementation of Energy Saving Products
Background
Located in the Red Centre of Australia, Ayers Rock Resort is an oasis in the midst of semi-arid desert. To cater for
the many visitors that come to explore Uluru (Ayers Rock) and Kata Tjuta (the Olgas), the Resort provides a wide
range of accommodation, from the luxury Sails in the Desert Hotel to backpacker dormitories.
As Uluru is one of Australias national icons, Ayers Rock Resort has been designed with low-rise architecture and
desert colours in keeping with the natural environment. However, at the Sails in the Desert Hotel, immense white
sails provide shade for guest comfort, and lush green lawns are bordered by abundant native plants and trees.
The Process
Environmental design features incorporated in the original development, include key tags in the rooms to conserve
electricity, water-efficient shower heads and dual flush toilets to conserve water and solar panels to reduce domestic
water heating energy consumption.
Recycled sewage water from the Resorts waste water treatment plant is used to maintain the Resorts landscaping
and gardens, thus helping to reduce water extraction from the Dune Plains Aquifer.
A sustainable recycling program for cardboard, aluminium can, car batteries and cooking oil continues to expand
throughout hotels and residential areas, generating revenues of about $2000 per month.
Cleaner Production Initiatives
While environmental features had been incorporated from the outset in the development of the Ayers Rock Resort,
management considered that a more disciplined approach was needed to ensure continuing improvements in
environmental performance. The ongoing development of an Environmental Management Plan formalises this
approach.
Given the extreme temperatures of Central Australia, energy conservation is a high priority. Energy costs are a
substantial part of operating the resort, with electricity costs averaging $1.2 million per annum.
The challenge faced by Ayers Rock Resort was to conserve energy by eliminating waste and utilise energy more
efficiently, while at the same time maintaining the Resorts high attraction to international visitors.
Installation of Computer Monitoring System
An effective monitoring system was required as the first step in identifying areas of energy wastage. By tracking energy
costs and allocating them directly to processes and equipment, managers can identify cost reduction opportunities
that can improve environmental quality. Reducing energy consumption and energy waste not only improves the
resorts efficiency and price competitiveness, but also minimises environmental degradation and consumption of
non-renewable resources. The original goal of the resort was to reduce energy consumption by 10 percent.. The
present goal is to maintain energy consumption at year 2012 levels even though visitor numbers continue to increase.
It can be achieved by the following:

Generating simple checklists, by which the system ensures that preventaive maintenance tasks are performed
at regular intervals.
The tracking capability of the system allows emerging problems, both of a specific and general management
nature, to be identified and solutions such as energy reduction initiatives to be formulated.
Preventative maintenance tasks are now a high priority at Ayers Rock Resort and maintenance engineers are
required to report on any preventative maintenance not undertaken.
108/JNU OLE
Implementation of accurate energy reporting and monthly energy auditing

Ayers Rock Resort achieved a 12.8% reduction in greenhouse gas emissions and attained an increased confidence
in the accuracy of the energy data being reported. Accurate reporting has allowed the identification of major energy
consumers which are targeted for further energy efficiency actions.
A comprehensive monthly report is delivered outlining electricity consumption and the total greenhouse gas emissions
from this.
Advantages of the Process
Installation of the monitoring system costs approximately $20,000 and had an expected payback period of less than
two years.
Preventative maintenance is expected to halve the number of equipment breakdowns and lessen any inconvenience
caused to guests.
Implementation of Monthly Energy Auditing
In addition to the savings derived from energy reduction initiatives, the monthly energy audit report helps to improve
awareness and build support for energy reduction projects. The one-page report generated for each hotel manager lists
the energy costs of that hotel for both the current and the previous months. Armed with this information, managers are
able to assess the performance of their respective operations and the recommendations made by the audit team.
Summary of Costs and Benefits
Capital Costs
Computer monitoring system
$20,000
Motion-sensor stairway lights
$2,400
Movements detectors in ablutions
$840
Additional switch installed in staff canteen
$7
Replacement of incandescent light bulbs
$4,800
TOTAL COSTS
$28,047
Capital costs
Cost Savings
Small energy management measures, when practiced widely, result in very worthwhile gains. Estimates of the
average cost savings per year at Ayers Rock Resort are set out below:
Savings from stairway motion-sensors
$10,220
Savings from ablution sensors
$122,660
Savings from staff canteen
$336
Savings from light bulb replacement
$151,200
Labour savings (50% less breakdown

of equipment)
$126,060
TOTAL SAVINGS
$410,476
Cost savings
109/JNU OLE
Question: After going through the above scenario, discuss the other benefits of the energy management for the
resort in terms of:
Benefits to the Environment
Employee Involvement
Cleaner Production Incentive
Barriers
110/JNU OLE
Case Study III

Reduction of Purchased Fuel Costs at Georgia-Pacifics Plywood Plant in Madison, Georgia.
Plywood Plant Background
The plant runs 24 hours, 7 days a week and employs about 400 people. The plant normally uses wood bark and
wood by-products for fuel. However, at certain times of the year, not enough bark was available, so additional fuel
had to be purchased from outside sources.
The process of making veneer layers in a plywood panel involves soaking logs in water to soften them, which
allows them to more easily pass through the lathe. The veneer is then dried at 405F. From the dryers, the veneer
goes to the glue line where layers are pressed into panels. The panels then go to the saw line for trimming before
banding and shipping
The Challenge
The heat was radiating out of 1500 feet of saturated steam lines and energy was being lost. A loss of heat meant a
loss in pressure, resulting in a reduced temperature.
What should the plant manager do to maintain the temperature for proper efficiency of the process and reduce cost
and pollution?
111/JNU OLE
Bibliography
References

http://bee-india.nic.in/energy_managers_auditors/documents/guide_books/1Ch3.pdf. Last accessed on 06th

January 2011.
http://www.google.co.in/images?hl=en&q=Ultrasonic%20leak%20detector&um=1&ie=UTF8&source=og&sa=N&tab=wi&biw=1229&bih=520. Last accessed on 06th January 2011.
http://www.google.co.in/images?hl=en&biw=1229&bih=520&tbs=isch%3A1&sa=1&q=steam+trap+tester&a
q=f&aqi=&aql=&oq=&gs_rfai=. Last accessed on 06th January 2011.
http://dictionary.babylon.com/mass_balance/. Last assessed on 11th January 2011.
http://www.kids.esdb.bg/basic_principles.html. Last assessed on 11th January 2011.
http://www.scribd.com/doc/43559513/1-4-Material-and-Energy-Balance. Last assessed on 11th January 2011.
http://www.bee- india.nic.in/energy_managers_auditors/documents/guide_books/1Ch8.pdf. Last assessed on

12th January 2011.
http://www.statgraphics.com/regression_analysis.htm#simple. Last assessed on 12th January 2011.
http://www.esru.strath.ac.uk/EandE/Web_sites/07- 08/Hotel_planning/Website%20Pages/User%20Manual%20
-%20CUSUM%20Analysis.html. Last assessed on 12th January 2011.

13th January 2011.
http://www.scmwise.com/project-management-steps.html. Last accessed on 13th January 2011.
http://www.avidbio.com/index.php?option=com_content&view=article&id=70&Itemid=84. Last accessed on

13th January 2011.
http://www.energymanagertraining.com/new_aboutcasestudies.php. Last accessed on 19th January 2011.
http://www.energychange.info/casestudies/177-case-study-20-building-energy-audits-project . Last accessed

on 19th January 2011.
http://www.bee-india.nic.in/content.php?page=energy_managers_auditors/guide_books.php. Last accessed on

19th January 2011.

16th January 2011.
http://www.iiec.org/dmdocuments/energy_efficiency_policy_planning_India_RajaKumar_BESCOM_15jun07.
pdf. Last accessed on 16th January 2011.
http://www.google.co.in/search?q=Energy+Policy+Planning&hl=en&biw=1229&bih=520&prmd=ivns&sour
ce=univ&tbs=vid:1&tbo=u&ei=N4o2Td3_EMzXcb6n9MYB&sa=X&oi=video_result_group&ct=title&resn
um=5&ved=0CEwQqwQwBA. Last accessed on 16th January 2011.
http://www.dougherty.k12.ga.us/dpms/PDFs/EGY/EGY-P001_energyaudit.pdf. Last assesses on 17th January

2011.
http://www.powermin.nic.in/distribution/energy_audit.htm. . Last assesses on 17th January 2011.
http://www.energyauditdirectory.com/articles/article-2.html. Last assesses on 17th January 2011.
Recommended Reading

Kostas Metaxiotis (2009). Intelligent Information Systems and Knowledge Management for Energy: Applications
for Decision Support, Usage, and Environmental Protection. Information Science Reference; First edition.
Stephen Howard (1998). Energy Management (Chandos Series on Construction & Facilities). Chartridge Books
Oxford.
Steve Doty (2008). Commercial Energy Auditing Reference Handbook. Fairmont Press; First edition.
G. V. Reklaitis (1983). Introduction to Material and Energy Balances. Wiley; first edition.
112/JNU OLE
Icon Group International (2010). Energy Balance: Websters Timeline History, 1950 2007. ICON Group
International, Inc.
Colin Oloman (2009). Material and Energy Balances for Engineers and Environmentalists (Advances in Chemical
and Process Engineering). Imperial College Press.
D. G. Gotel (1989). The Application of Monitoring & Targeting to Energy Management (Home Office Research
Study). HMSO Books.
Jeff S Haberl (1992). Building energy monitoring workbook. Energy Systems Laboratory, Texas A & M
University.
Jeffery Cosiol (1982). Energy monitoring and control systems - performance verification and endurance test
procedures. Naval Civil Engineering Laboratory.
Project Management Institute (2008). A Guide to the Project Management Body of Knowledge: (Pmbok Guide).
Project Management Institute; fourth edition.
Harold Kerzner (2009). Project Management: A Systems Approach to Planning, Scheduling, and Controlling.
Wiley; Tenth edition.
James P. Lewis (2006). Fundamentals of Project Management (Worksmart Series). AMACOM; Third edition.
Wesley K. Foell (1979). Management of Energy/Environment Systems: Methods and Case Studies (International
series on applied systems analysis). John Wiley & Sons Ltd.
Michael Albanes (1978). An energy audit/case study: The May-D & F department store, Colorado Springs,
Colorado. Energy Conservation and Alternatives Centre for Commerce and Industry.
Richard Rogers (1979). An energy audit case study: The City Elite Laundry, Denver, Colorado. Energy
Conservation and Alternatives Centre for Commerce and Industry.
John Randolph PhD (2008). Energy for Sustainability: Technology, Planning, Policy. Island Press; first
edition.
John Byrne (1989). Planning for Changing Energy Conditions (Energy Policy Studies, Volume 4). Transaction
Publishers.
Frank J. Convery (1999). A Guide to Policies for Energy Conservation: The European Experience. Edward
Elgar Publishing.
Albert Thumann (2010). Handbook of Energy Audits. Fairmont Pr; Eighth edition.
Steve Doty (2008). Commercial Energy Auditing Reference Handbook. Fairmont Press; first edition.
Shirley J. Hansen (2004). Investment Grade Energy Audit: Making Smart Energy Choices. Fairmont Press.
113/JNU OLE
Self Assessment Answers

Chapter I
1. d
2. a
3. b
4. d
5. a
6. c
7. c
8. d
9. a
10. d
Chapter II
1. a
2. c
3. b
4. a
5. d
6. c
7. c
8. d
9. c
10. a
Chapter III
1. b
2. b
3. b
4. d
5. c
6. c
7. b
8. d
9. b
10. b
Chapter IV
1. c
2. b
3. c
4. b
5. c
6. d
7. a
8. c
9. c
10. d
114/JNU OLE
Chapter V
1. The barriers to the successful implementation of the energy savings project are:

cost of energy is too small when compared to production cost,
non involvement or poor co-ordination among the inter-departments
lack of minimum instrumentation, metering and monitoring,
new technology application,

2.
3.
4.
5.
lack of Communication to down stream manpower

b
a
d
The major causes for the non-implementation were:
Though the malfunctioning and not working traps were replaced initially, the task of assigning responsibility
of steam trap management for sustainability was not done.
No allotment of budget for steam trap management under the house keeping or maintenance or energy conservation
budget.
No strategic planning for periodic steam trap survey for identification of failures.
6. b
7. Plant has not implemented soft starter on mechanical presses due to:

Less operating hours of the equipment
High investment
Long payback period

8. d
9. d
10. a
Chapter VI
1. c
2. b
3. a
4. c
5. a
6. a
7. d
8. c
9. b
10. d
Chapter VII
1. c
2. d
3. b
4. a
5. b
6. d
7. d
8. a
9. b
10. b
115/JNU OLE

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Energy Audit and Management

This book is a part of the course by Jaipur National University, Jaipur.

7.4 Information Systems............................................................................................................................. 100

Bureau of Energy Efficiency

introduce the concept of energy management

highlight the importance of energy audit

explain the fuel substitution theory

explain the goals and strategies of energy management

analyse the real time cases of energy management styles

emphasize the importance of need and styles of energy audit

understand the concept of system efficiency

understand the working of energy audit instruments

learn how to benchmark energy consumption