Companies considering energy conservation measures must balance each measure's price tag with the expected energy savings. Conservation projects that don't offer a quick investment return won't survive the budget axe. Now, energy engineers reveal that a more comprehensive analysis of the companys energy costs could increase the value of the project, allowing the company to carry out conservation plans that might otherwise appear too expensive.

Digging out all of the savings above and beyond lowered energy costs could double the value of an energy conservation project, according to engineer Ernest Fossum at the U.S. Department of Energy's Idaho National Engineering and Environmental Laboratory. In an article in the July 2000 issue of Energy Engineering journal, Fossum and INEEL colleagues Dale Teel and Will Wyland show how those additional savings could speed up the time it takes for a company to pay off the cost of a such a project.

"We've often heard we should look closer at our unit cost of energy, but no one explains how," says Fossum. "There's a real need to practically spell out ways to reduce the payback time by capturing all of the relevant savings."

Many energy managers determine energy savings by simply using the billed energy costs, says Fossum. For example, if new energy-efficient windows are installed, energy savings will be reflected in a smaller power bill at the end of the month. Those savings are used to determine how long it will take to recoup the cost of the windows.

However, simple billed energy costs leave out important details of the company's daily operations, say the authors. Basing their calculations on a typical, theoretical conservation project, the authors illustrate a variety of overlooked savings. They apply those savings -- both in energy usage and other related costs -- to the case study and analyze the effect the impacts have on the project's payback perio
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Contact: Mary Beckman
beckmt@inel.gov
208-526-0061
DOE/Idaho National Laboratory
3-Oct-2000