Energy management is defined as the combination and application of business management and industrial organisation methods to assist the optimal use of energy resources for effective task processing.

Energy management is a concept, which originated in the oil crisis of 1974 and has developed progressively through the 1970's and 1980's as a result of the possible non-guarantee of energy supplies from the Middle East; with continuous development as a result of the recent concern for the environment and the impact that current levels of energy utilisation is having on it. The RIO summit and the resulting energy policies, to be implemented on a global basis, aims at reducing CO₂ emissions, Agenda 21, by placing greater emphasis on energy conservation measures and better management procedures to minimise the impact our existing enrage demands are having on the environment, e.g. the greenhouse effect, generation of ground level ozone, and the depletion of ozone in the stratosphere by chloral floural carbons (CFC's).

Energy management has financial benefits attached to the implementation of energy saving policies / technologies by reducing overheads directly in proportion to the energy savings achieved. In many industries, energy is treated just like any other industrial commodity, the less required to produce a product the lower the production costs.

A company is likely to energy either in the direct manufacture of products (e.g. steam raising, powering electric motors, heating of plastics prior to forming etc.) or in activities which support the manufacturing process (e.g. space heating of buildings, hot water services, lighting etc.). The general concept of monitoring performance and setting targets is a central prerequisite to the control of costs and the motivation of personnel involved with energy usage.

The basis of organisation of an energy policy is an energy audit, which is a formal account of the energy consumption and the associated costs to a company over some specified period of time. The energy audit is itself generated from an energy monitoring strategy, which could involve the regular recording of data related to the energy performance of anything from an entire site to the to a single production line or even an individual item of plant. In order to show the pattern and efficiency of energy usage and allow a comparison with similar systems, consumption figures are generally quoted relative to a unit of production (MJ/ tonne) or to a unit floor area of a building (kWh/ m²).

One of the existing problems of M&T systems was the data collection of the energy usage and its assessment. Therefore several software tools that could give a solution to that problem were developed. A similar tool called EnTrack was created by the Energy Systems Research Unit (ESRU) of the University of Strathclyde. This system monitors on a regular base the energy consumption of the University buildings needed for the assessment of their energy performance. Soon the energy profiles will be accesible from the Internet.

Auditing allows the identification of areas of high-energy consumption. These can then be targeted to determine the underlying causes and allow suitable remedial action to be planned. This might involve simple 'good house-keeping' measures, such as the elimination of unnecessary leaks in steam or compressed air lines, or more complicated action, such as revised load scheduling to operate existing plant performance or the replacement of existing plant by new types of system, for example, the case where a CHP plant replaces a system of bought-in electricity and hot water from a boiler.

Continued monitoring and auditing will allow the efficacy of remedial measures to be determined and permit a comparison of actual energy usage and costs with target figures.

In order to maximise the benefits to a company; the introduction of energy management strategies requires a phased approach, typically as follows:

Phase 1 Gaining control over energy consumption.

Phase 2 Investing in energy saving measures.

Phase 3 Maintaining control over consumption.

(i) Purchasing Strategies:

(ii) Operating Practices:

(iii) Motivation and Training Strategies:

Review energy awareness campaigns to ensure good housekeeping practices.

1. Investment Strategies:

1. Energy Management Information:

Review data collection, processing and feedback to ensure information is supplied on time to those who need it.

2. Maintain control over consumption:

Ensuring current practices maintain savings already achieved

3. Sustain energy savings.

Making sure future practices maintain/ build upon levels of savings currently achieved

4. Protect energy savings investments.

In manufacturing a product, energy is consumed during the exploration, excavation, transportation, refining and utilization of raw materials, such as fossil fuels, metals, plastics, refractories, paper and chemicals, as well as during manufacture itself. Buildings and building services equipment, such as heating and ventilating systems, lighting and air conditioning consume energy and materials. Further commodities are expensed during marketing and distribution. All along this chain, energy and materials are consumed by infrastructures and services.

In the examination of an energy flow system, the energy manager must take great care to define the boundaries of the system under scrutiny, and to identify commodity flows across these boundaries.

The energy audit may concern:

• The energy 'content' of a product
• The energy consumed by a manufacturing procedure
• The energy requirements of a built facility or service, such as a transportation system

In each case, the audit should include an environmental audit of solid, liquid effluent and gaseous wastes.

In assessing the historical energy content and environmental impact of a product, its input materials and rejected pollution should be listed and the production process fully outlined. A cradle-to-grave approach should be adopted.

Once the flowchart has been established high demand operations should be critically examined with a view towards greater energy efficiency and the minimization of pollution.

Where fossil fuels, electricity, materials or products enter the system boundary, they bring with them their historical energy, materials and 'pollution' content.

In delivering fossil fuels and electricity, energy and materials are consumed and pollution takes place. In order to quantify these, the energy manager should obtain data concerning deliveries of energy resources and materials to the energy industries over a recent representative period, together with the amounts of the fuels exported over the same period.

Similarly, raw materials, e.g. metals, plastics, glass, have historical energy and 'pollution' contents. These can again be quantified by analysing industrial energy and materials deliveries and exports of materials.

Having built the building blocks, quantity surveying data may be used to assess the energy and environment costs of products.

The construction of an energy and materials audit, or input/output balance, is appropriate for any resource-consuming activity. The energy costs of fuels, raw materials and products must be estimated before any realistic attempt can be made to reduce the historical resource content of products.

A detailed knowledge of all inputs, throughputs and outputs occuring during manufacture must be obtained before the resource utilization efficiencies of processes can be improved most cost-effectively. The optimal cost-effectiveness resulting from the application of any resource saving technique can never be achieved by restricting examination to individual components of a system. Each system must be studied as a whole to identify major waste centres and to compare the cost-effectivenesses and environmental impacts of the many alternative or retrofit actions possible.