Improving energy efficiency for facilities management under a new climate change policy

Contrary to public opinion, the changing of the guard in Canberra in September this year hasn’t stopped carbon emissions leaking from Australian business into the atmosphere at one of the highest per capita intensity levels of any developed economy on the planet. This author is given to understand that it hasn’t stopped the boats either, but that is another story for another day.

Australian businesses are still expressing their commitment to reducing their carbon footprint, even though Energy Action has observed that there is perhaps a nuanced shift in the motivations that are leading companies to invest in energy efficiency and sustainability management.

Our research tells us that there are two key drivers for our customers’ continued drive towards sustainability:

1. The boat has sailed (no political double entendre intended): sustainability remains a strategic, compliance and reporting issue for building stakeholders that requires continued attention and careful planning.
2. The energy ‘bill frog’ is still boiling in the energy ‘cost pot’: delivered energy costs to a building are still a pain point for buildings and their tenants.

The new federal government does bring with it a new direction in funding for energy-efficiency investments. Direct Action represents, in short, less public funding for energy efficiency than the ‘Securing Australia’s energy future’ package of funding supported by the carbon tax. In a deft sleight of hand, the incoming government has declared the removal of the social licence to collect the carbon tax, stripped the funding commitments to assist businesses to adjust to the carbon price, but left the revenue collection mechanisms in place.

More specific than this author’s vague sense of moral outrage, we can also see facilities managers feeling the impacts of delays in government decision-making at both the parliamentary and the executive level of the Coalition government. The government has, of course, released its proposed terms of reference for the Emissions Reduction Fund; however, the white paper is not expected until mid-2014.

Regarding the other major plank of federal government activity, the renewable energy targets, these too, are likely to change. Somehow. Sometime.

Back in May of this year, the now Minister for Energy Ian Macfarlane indicated that the Coalition would be undertaking a further review of the Large and Small Scale Renewables Schemes once it came into office. While nothing has since been confirmed, it is widely believed that this will take place in the first quarter of 2014, and a swift implementation of the review’s findings could be expected.

One of the expected outcomes is a reduction in the long-term target for renewable generation, although even a reduced target would still require more renewables to be built than are installed today.

At the state level, both the NSW and Victorian governments are preparing new initiatives in the wake of the change of direction at the federal level, but little will be implemented this quarter.

So what does all this change mean for facility management?

Given that most of the federal and state policy changes and implementation won’t occur until mid-2014 and beyond, and the details around what federal grants will exist for businesses are uncertain, facilities managers should take the opportunity now to gain a better understanding of how energy is used in their facilities and review their planning processes to improve energy efficiency in the new year.

As our customers keep telling us, improving energy efficiency and energy management is critical to help facility managers prepare for rising electricity costs, as well as reducing greenhouse gas emissions.

Now represents a great time to undertake the following steps for the new year:

• Determine your facilities’ energy-efficiency baseline. Can you answer the following question: What is the relationship between energy as a process input and the desired outputs from your facility?;
• Develop an operational energy profile for your facility to understand systemic and anomalous energy usage issues;
• Set performance targets for your facility over the short, mid and long term;
• Develop monitoring and reporting processes for your facilities’ performance targets;
• Identify and prioritise your preferred energy usage and management improvement initiatives; and
• Communicate your facilities’ results with key stakeholders, eg, owners, residents and shareholders.

When facilities managers are able to explain the energy-efficiency relationship in their facilities, they can use this information to implement more cost-effective projects that help reduce energy consumption and the associated costs every single day and under all conditions.

*Edward Hanna runs a team of energy-efficiency engineers and commercial experts that focus on developing partnerships with Australian businesses to continually improve their cost of energy operations. He has been involved in the energy industry since the deregulation of the NSW electricity market commenced in 1997.