Energy Intensity Baselining and Tracking Guidance

Abstract

Each company joining the U.S. Department of Energy’s (DOE’s) Better Buildings, Better Plants Program (Better Plants) commits to establishing an energy consumption and energy intensity (EI) baseline and to tracking its energy performance over a 10-year period against that baseline. The baseline must reflect a company’s energy consumption over a 12-month period, covering all its U.S.-based operations. Energy consumption is calculated by fuel type in terms of primary energy (also known as source energy). EI is broadly defined as the amount of energy consumed per unit of output produced. For this guidance document and for the program, the term energy performance represents an evaluation of a facility’s capacity to use energy efficiently. Metrics used to assess a facility’s energy performance can include EI, energy consumption, improvements in EI, etc. Establishing an energy baseline and tracking system is a critical first step in effectively managing energy use. Developing a baseline can help a company understand energy use within the corporation and give it a point of comparison to evaluate future efforts to improve energy performance. It can also support efforts to validate a company’s energy management activities, improve comparative analyses when using benchmarks, and help in predicting future energy needs. In addition, a company that normalizes its performance data can determine highly defensible measures of energy savings generated through implemented energy efficiency projects. Establishing a baseline and tracking energy performance is also a requirement for ISO 50001 certification. Although basic energy data can be collected through utility bills, most manufacturers will have to perform additional analyses to develop accurate and robust energy baselines and tracking systems. Energy is consumed in many ways within the manufacturing sector and can come from multiple sources. Energy is sometimes generated and sold to other parties or captured and reused on-site. External events can exert a significant impact on a facility or company’s energy use independent of any purposeful efforts to improve energy efficiency. Operational changes, such as production shifts—which may be inevitable for some companies over the 10-year period covered by the program—can also make a big difference in energy use. Since Better Plants asks companies to account for all their U.S.-based operations, mergers, acquisitions, and divestitures can also have significant implications for a company’s energy metrics. This document aims to demystify the sometimes complex baselining process. It devotes special attention to the task of normalizing and adjusting energy consumption to account for external factors, such as weather and production changes. A key recommendation is that companies use regression analysis to normalize their energy consumption data whenever possible. Regression analysis is a statistical technique that estimates the dependence of a variable (i.e., energy use in the context of Better Plants) on one or more independent variables such as ambient temperature, while controlling for the influence of other variables at the same time. A properly developed regression analysis can provide a reliable estimate of energy savings resulting from energy improvement strategies and projects by accounting for the effects of variables such as annual production levels and weather. DOE has developed a companion Energy Performance Indicator software tool (EnPI) to simplify the baselining process. This tool can run regression models, calculate changes in EI at the facility level, and automatically compile facility-level data into a corporate-wide metric. Note that although the relevant equations used to calculate EI are provided in this document, the EnPI tool will automatically perform most calculations for the user. Additionally, Better Plants Partners (Partners) can call on their Technical Account Manager (TAM) to help them establish a baseline and assist with the necessary calculations to track progress.