Energy management includes planning and operation of energy production and energy consumption units as well as energy distribution and storage. Objectives are resource conservation, climate protection and cost savings, while the users have permanent access to the energy they need. It is connected closely to environmental management, production management,

logistics Logistics is generally the detailed organization and implementation of a complex operation. In a general business sense, logistics manages the flow of goods between the point of origin and the point of consumption to meet the requirements of ...

and other established business functions. The VDI-Guideline 4602 released a definition which includes the economic dimension: "Energy management is the proactive, organized and systematic coordination of procurement, conversion, distribution and use of energy to meet the requirements, taking into account environmental and economic objectives". It is a systematic endeavor to optimize energy efficiency for specific political, economic, and environmental objectives through Engineering and Management techniques.

Energy efficiency

Base line of energy assessment

One of the initial steps for an effective energy cost control program is the base line energy assessment, which examines the pattern of existing energy usage by the government or any sub-entity of the government or private organization. This program will set the reference point for improvements in energy efficiency. Energy efficiency can improve the existing energy usage and benchmarking of every individual section such as area, sub-area and the industry etc. .

Organizational integration

It is important to integrate the energy management in the organizational structure, so that the energy management can be implemented. Responsibilities and the interaction of the decision makers should be regularized. The delegation of functions and competencies extend from the top management to the executive worker. Furthermore, a comprehensive coordination can ensure the fulfillment of the tasks. It is advisable to establish a separate organizational unit "energy management" in large or energy-intensive companies. This unit supports the senior management and keeps track. It depends on the basic form of the

organizational structure An organizational structure defines how activities such as task allocation, coordination, and supervision are directed toward the achievement of organizational aims. Organizational structure affects organizational action and provides the foundat ...

, where this unit is connected. In case of a functional organization the unit is located directly between the first ( CEO) and the second hierarchical level (corporate functions such as production,

procurement Procurement is the method of discovering and agreeing to terms and purchasing goods, services, or other works from an external source, often with the use of a tendering or competitive bidding process. When a government agency buys goods or serv ...

marketing Marketing is the process of exploring, creating, and delivering value to meet the needs of a target market in terms of goods and services; potentially including selection of a target audience; selection of certain attributes or themes to emph ...

). In a divisional organization, there should be a central and several sector-specific energy management units. So the diverse needs of the individual

sector Sector may refer to: Places * Sector, West Virginia, U.S. Geometry * Circular sector, the portion of a disc enclosed by two radii and a circular arc * Hyperbolic sector, a region enclosed by two radii and a hyperbolic arc * Spherical sector, a p ...

s and the coordination between the branches and the head office can be fulfilled. In a

matrix organization Matrix management is an organizational structure in which some individuals report to more than one supervisor or leader–relationships described as solid line or dotted line reporting. More broadly, it may also describe the management of cross-f ...

the energy management can be included as a matrix function and thus approach most functions directly.

Energy management in operational functions

Facility management

Facility management Facility management or facilities management (FM) is a professional management discipline focused on the efficient and effective delivery of logistics and other support services related to real property and buildings. It encompasses multiple disc ...

is an important part of energy management, because a huge proportion (average 25 per cent) of complete

operating cost Operating costs or operational costs, are the expenses which are related to the operation of a business, or to the operation of a device, component, piece of equipment or facility. They are the cost of resources used by an organization just to main ...

s are energy costs. According to the

International Facility Management Association The International Facility Management Association (IFMA), originally the National Facility Management Association (NFMA), is a professional membership association for facility management professionals. IFMA's global headquarters office is located i ...

(IFMA), facility management is "a profession that encompasses multiple disciplines to ensure functionality of the built environment by integrating people, place, processes and technology." The central task of energy management is to reduce costs for the provision of energy in buildings and facilities without compromising work processes. Especially the availability and service life of the equipment and the ease of use should remain the same. The German Facility Management Association (GEFMA e.V.) has published guidelines (e.g. GEFMA 124-1 and 124–2), which contain methods and ways of dealing with the integration of energy management in the context of a successful facility management. In this topic the facility manager has to deal with economic, ecological, risk-based and quality-based targets. He tries to minimize the total cost of the energy-related processes (supply, distribution and use). Passive house scheme 1

The most important key figure in this context is kilowatt-hours per square meter per year (kWh/m²a). Based on this key figure properties can be classified according to their energy consumption. * Europe: In Germany a low-energy house can have a maximum energy consumption of 70 kWh/m²a. * North America: In the

United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territori ...

, the

ENERGY STAR Energy Star (trademarked ''ENERGY STAR'') is a program run by the U.S. Environmental Protection Agency (EPA) and U.S. Department of Energy (DOE) that promotes energy efficiency. The program provides information on the energy consumption of pr ...

program is the largest program defining low-energy homes. Homes earning ENERGY STAR certification use at least 15% less energy than standard new homes built to the International Residential Code, although homes typically achieve 20–30% savings. In comparison, the

passive house "Passive house" (german: Passivhaus) is a voluntary standard for energy efficiency in a building, which reduces the building's ecological footprint. It results in ultra-low energy buildings that require little energy for space heating or coo ...

ultra-low-energy standard, currently undergoing adoption in some other European countries, has a maximum space heating requirement of 15 kWh/m²a. A passive house is a very well insulated and virtually airtight building. It does not require a conventional heating system. It is heated by solar gain and internal gains from people. Energy losses are minimized. There are also buildings that produce more energy (for example by solar water heating or photovoltaic systems) over the course of a year than it imports from external sources. These buildings are called energy-plus-houses. In addition, the work regulations manage competencies, roles and responsibilities. Because the systems also include risk factors (e.g. oil tanks, gas lines), you must ensure that all tasks are clearly described and distributed. A clear regulation can help to avoid liability risks.

Logistics

A8 bei Derching LKW Richtung München MAN Mercedes

Logistics is the

management Management (or managing) is the administration of an organization, whether it is a business, a nonprofit organization, or a Government agency, government body. It is the art and science of managing resources of the business. Management includ ...

of the flow of

resources Resource refers to all the materials available in our environment which are technologically accessible, economically feasible and culturally sustainable and help us to satisfy our needs and wants. Resources can broadly be classified upon their av ...

between the point of origin and the point of destination in order to meet some requirements, for example of customers or corporations. Especially the core logistics task, transportation of the goods, can save costs and protect the environment through efficient energy management. The relevant factors are the choice of means of transportation, duration and length of transportation and cooperation with logistics service providers. The logistics causes more than 14% percent of emissions worldwide. For this reason the term

Green Logistics Green logistics describes all attempts to measure and minimize the ecological impact of logistics activities. This includes all activities of the forward and reverse flows of products, information and services between the point of origin and the ...

is becoming increasingly important. Possible courses of action in terms of green logistics are: * Shift to ecofriendly transport carrier such as railroad and waterway * Route and load optimization * Formation of corporate networks, which are connected by logistics service * Optimizing physical logistics processes by providing a sophisticated IT support Besides transportation of goods, the transport of persons should be an important part of the logistic strategy of organizations. In case of business trips it is important to attract attention to the choice and the proportionality of the means of transport. It should be balanced whether a physical presence is mandatory or a telephone or video conference is just as useful. Home Office is another possibility in which the company can protect the environment indirectly.

Energy procurement

Procurement is the acquisition of goods or services. Energy prices fluctuate constantly, which can significantly affect the energy bill of organizations. Therefore, poor energy procurement decisions can be expensive. Organizations can control and reduce energy costs by taking a proactive and efficient approach to buying energy. Even a change of the energy source can be a profitable and eco-friendly alternative.

Production

Production is the act of creating output, a good or service which has value and contributes to the utility of individuals. This central process may differ depending on the industry. Industrial companies have facilities that require a lot of energy. Service companies, in turn, do not need many materials, their energy-related focus is mainly facility management or Green IT. Therefore, the energy-related focus has to be identified first, then evaluated and optimize.

Production planning and control

Usually, production is the area with the largest energy consumption within an organization. Therefore, also the production planning and control becomes very important. It deals with the operational, temporal, quantitative and spatial planning, control and management of all processes that are necessary in the production of goods and commodities. The "production planner" should plan the production processes so that they operate in an energy efficient way. For example, strong power consumer can be moved into the night time. Peaks should be avoided for the benefit of a unified load profile. The impending changes in the structure of energy production require an increasing demand for storage capacity. The Production planning and control has to deal with the problem of limited storability of energy. In principle there is the possibility to store energy electrically, mechanically or chemically. Another trend-setting technology is lithium-based electrochemical storage, which can be used in electric vehicles or as an option to control the power grid. The German Federal Ministry of Economics and Technology realized the significance of this topic and established an initiative with the aim to promote technological breakthroughs and support the rapid introduction of new energy storage.

Maintenance

Maintenance is the combination of all technical and administrative actions, including supervision actions, intended to retain an item in, or restore it to, a state in which it can perform a required function. Detailed maintenance is essential to support the energy management. Hereby power losses and cost increases can be avoided.

Energy management challenge

Through the energy efficiency it management is remain the key for the any industrial user across globe, to achieve the energy management goal for the federal government or industry the efficiency of water and energy resources play a vital role Examples of how it is possible to save energy and costs with the help of maintenance: * Defrost the fridges * Check the barometer of cars and trucks * Insulation of hot systems * Improve leaks in building envelopes

Energy strategies

A long-term energy strategy should be part of the overall strategy of a company. This strategy may include the objective of increasing the use of

renewable energies Renewable energy is energy that is collected from renewable resources that are naturally replenished on a human timescale. It includes sources such as sunlight, wind, the movement of water, and geothermal heat. Although most renewable energy ...

. Furthermore, criteria for decisions on energy investments, such as yield expectations, are determined. By formulating an energy strategy companies have the opportunity to avoid risks and to assure a competitive advance against their business rivals.

Potential energy strategies

According to Kals there are the following energy strategies: * Passive Strategy: There is no systematic planning. The issue of energy and environmental management is not perceived as an independent field of action. The organization only deals with the most essential subjects. * Strategy of short-term profit maximization: The management is concentrating exclusively on measures that have a relatively short

payback period Payback period in capital budgeting refers to the time required to recoup the funds expended in an investment, or to reach the break-even point. Farris, Paul W.; Neil T. Bendle; Phillip E. Pfeifer; David J. Reibstein (2010). ''Marketing Metrics: T ...

and a high return. Measures with low profitability are not considered. * Strategy of long-term profit maximization: This strategy includes that you have a high knowledge of the energy price and technology development. The relevant measures (for example,

heat exchanger A heat exchanger is a system used to transfer heat between a source and a working fluid. Heat exchangers are used in both cooling and heating processes. The fluids may be separated by a solid wall to prevent mixing or they may be in direct conta ...

s or

power station A power station, also referred to as a power plant and sometimes generating station or generating plant, is an industrial facility for the generation of electric power. Power stations are generally connected to an electrical grid. Many ...

s) can have durations of several decades. Moreover, these measures can help to improve the image and increase the motivation of the employees. * Realization of all financially attractive energy measures: This strategy has the goal to implement all measures that have a positive return on investment. * Maximum strategy: For the climate protection one is willing to change even the object of the company. In reality, you usually find hybrid forms of different strategies.

Energy strategies of companies

Many companies are trying to promote its image and time protect the climate through a proactive and public energy strategy. General Motors (GM) strategy is based on continuous improvement. Furthermore, they have six principles: e.g. restoring and preserving the environment, reducing waste and pollutants, educating the public about environmental conservation, collaboration for the development of environmental laws and regulations.

Nokia Nokia Corporation (natively Nokia Oyj, referred to as Nokia) is a Finnish multinational telecommunications, information technology, and consumer electronics corporation, established in 1865. Nokia's main headquarters are in Espoo, Finland, i ...

created its first climate strategy in 2006. The strategy tries to evaluate the energy consumption and

greenhouse gas emissions Greenhouse gas emissions from human activities strengthen the greenhouse effect, contributing to climate change. Most is carbon dioxide from burning fossil fuels: coal, oil, and natural gas. The largest emitters include coal in China and ...

of products and operations and sets reduction targets accordingly. Furthermore, their environmental efforts is based on four key issues: substance management, energy efficiency, recycling, promoting environmental sustainability. The energy strategy of

Volkswagen Volkswagen (),English: , . abbreviated as VW (), is a German motor vehicle manufacturer headquartered in Wolfsburg, Lower Saxony, Germany. Founded in 1937 by the German Labour Front under the Nazi Party and revived into a global brand post-W ...

(VW) is based on environmentally friendly products and a resource-efficient production according to the "Group Strategy 2018". Almost all locations of the Group are certified to the international standard ISO 14001 for environmental management systems. When looking at the energy strategies of companies it is important to you have the topic

greenwashing Greenwashing (a compound word modeled on " whitewash"), also called "green sheen", is a form of advertising or marketing spin in which green PR and green marketing are deceptively used to persuade the public that an organization's products, aim ...

in mind. This is a form of propaganda in which green strategies are used to promote the opinion that an organization's aims are environmentally friendly.

Energy strategies of politics

Even many countries formulate energy strategies. The

Swiss Federal Council The Federal Council (german: Bundesrat; french: Conseil fédéral; it, Consiglio federale; rm, Cussegl federal) is the executive body of the federal government of the Swiss Confederation and serves as the collective head of state and governm ...

decided in May 2011 to resign nuclear energy medium-dated. The nuclear power plants will be shut down at the end of life and will not be replaced. In Compensation they put the focus on energy efficiency,

, fossil energy sources and the development of

water power Hydropower (from el, ὕδωρ, "water"), also known as water power, is the use of falling or fast-running water to produce electricity or to power machines. This is achieved by converting the gravitational potential or kinetic energy of a wa ...

. The

European Union The European Union (EU) is a supranational political and economic union of member states that are located primarily in Europe. The union has a total area of and an estimated total population of about 447million. The EU has often been des ...

has clear instructions for its members. The "20-20-20-targets" include, that the

Member States A member state is a state that is a member of an international organization or of a federation or confederation. Since the World Trade Organization (WTO) and the International Monetary Fund (IMF) include some members that are not sovereign states ...

have to reduce greenhouse gas emissions by 20% below 1990 levels, increase energy efficiency by 20% and achieve a 20% share of renewable energy in total energy consumption by 2020.

Ethical and normative basis of the energy strategies

The basis of every energy strategy is the

corporate culture Historically there have been differences among investigators regarding the definition of organizational culture. Edgar Schein, a leading researcher in this field, defined "organizational culture" as comprising a number of features, including a s ...

and the related ethical standards applying in the company.

Ethics Ethics or moral philosophy is a branch of philosophy that "involves systematizing, defending, and recommending concepts of right and wrong behavior".''Internet Encyclopedia of Philosophy'' The field of ethics, along with aesthetics, concerns m ...

, in the sense of

business ethics Business ethics (also known as Corporate Ethics) is a form of applied ethics or professional ethics, that examines ethical principles and moral or ethical problems that can arise in a business environment. It applies to all aspects of business co ...

, examines ethical principles and moral or ethical issues that arise in a business environment. Ethical standards can appear in company guidelines, energy and environmental policies or other documents. The most relevant ethical ideas for the energy management are: *

Utilitarianism In ethical philosophy, utilitarianism is a family of normative ethical theories that prescribe actions that maximize happiness and well-being for all affected individuals. Although different varieties of utilitarianism admit different charact ...

: This form of ethics has the maxim that the one acts are good or right, whose consequences are optimal for the welfare of all those affected by the action (principle of maximum happiness). In terms of energy management, the existence of external costs should be considered. They do not directly affect those who profit from the economic activity but non-participants like future generations. This error in the market mechanism can be solved by the

internalization Internalization ( or internalisation) is the process of making something internal, with more specific meanings in various fields. It is the opposite of externalization. Psychology and sociology In psychology, internalization is the outcome of ...

external cost In economics, an externality or external cost is an indirect cost or benefit to an uninvolved third party that arises as an effect of another party's (or parties') activity. Externalities can be considered as unpriced goods involved in either co ...

s.Johannes Kals: ''Betriebliches Energiemanagement - Eine Einführung.'' Kohlhammer, Stuttgart 2010, , p. 200. * Argumentation Ethics: This fundamental ethical idea says that everyone who is affected by the decision, must be involved in decision making. This is done in a fair

dialogue Dialogue (sometimes spelled dialog in American English) is a written or spoken conversational exchange between two or more people, and a literary and theatrical form that depicts such an exchange. As a philosophical or didactic device, it is c ...

, the result is completely uncertain.Johannes Kals: Business Ethics and Corporate Energy Management, in: Karczewski, Leszek; Kretek, Henryk (eds): Odpowiedzialny biznes i konsumerysm wyzwaniem XXI Wieku (Responsible Business and Responsible Consumerism as a Challenge of the 21st Century), Polen, Raciborz 2012, p. 6. *

Deontological ethics In moral philosophy, deontological ethics or deontology (from Greek: + ) is the normative ethical theory that the morality of an action should be based on whether that action itself is right or wrong under a series of rules and principles, ra ...

: The deontological ethics assigns individuals and organizations certain obligations. A general example is the golden rule: "One should treat others as one would like others to treat oneself." Therefore, everyone should manage their duties and make an energy economic contribution.