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v1 Jan 2014

DRIVING UP PROFITS AND REDUCING
EMISSIONS: THE BENEFITS OF ISO 50001




This work by Lucideon is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike
4.0 International License.


by Lucideon 2
INTRODUCTION
With over 80% of global Greenhouse Gas (GHG)
emissions resulting from energy generation and
use, if we are to make any serious attempt to
address climate change we need to completely
rethink the ways in which we produce and
consume energy.
Under the 2009 EU Renewable Energy Directive,
the UK has been set a target to generate 15% of
its total energy supply from renewable sources
by 2020. Although this is an ambitious target,
significant progress has been made in this area
over recent years. This is particularly true for
electricity generation where the renewables share
has risen from less than 2% in 2001, to 12.3% in
Quarter 1 of 2013.
All major energy users will be aware of the
Government policies designed to encourage
energy efficiency – these have mainly been in the
form of green taxes, and initiatives such as the
Climate Change Levy and the CRC Energy
Efficiency Scheme; all have pushed up energy
costs. The signs are that there may be additional
costs pushed on to the consumer through the
European Emissions Trading Scheme and the
Electricity Market Reform programme.
On top of the increased costs caused by
environmental taxes, underlying UK energy prices
have been rising steadily over the past decade;
we are increasingly exposed to volatile
international markets as the output of oil and gas
from the North Sea diminishes. As economic
growth continues in India, China and other
developing economies, demand for energy will
remain high – as will prices.
The impact of high energy prices and volatility
has been felt most keenly by energy-intensive
manufacturing businesses, but all consumers
have been affected to some extent. Given the
current spending restraints, this has had a major
impact on many public sector organisations, such
as hospitals and universities. The public sector
has an annual energy spend of over £3bn; even a
small rise in energy costs can have a significant
impact upon service delivery.

Figure 1.
i
Fuel Prices (excluding CCL) for Manufacturing Industry – 1990 to 2011 [Source: Dept. Energy
& Climate Change]
Energy therefore represents a large and
increasing cost to organisations across the public
and private sectors and it makes good business
sense to manage its use so that:
- It is used as efficiently as possible with
minimum wastage – resource and cost
efficiency
- Energy savings are identified and
implemented – a proactive and continuous
approach
- The impacts of energy price increases and
energy sources are understood – risk
management.


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Additionally, energy management has other,
related benefits such as:
- The reduction of carbon emissions with the
resulting positive effect on an organisation’s
carbon footprint - limiting of environmental
impact
- The development of new energy-efficient
products/technologies – new product
development and innovation
- The proof, to your stakeholders, of your
commitment to the environment – enhanced
brand reputation and competitive positioning.
ISO 50001 is the new international standard for
energy management. It ensures a disciplined and
logical approach to energy management ensuring
that all the benefits listed above are realised.
In this white paper, in addition to the benefits of
having an Energy Management System (EnMS)
certified to ISO 50001, we will look at what the
standard entails and detail organisations that
have been early adopters of the scheme.
WHAT IS ISO 50001?
ISO 50001 was formally launched in June 2011 as
the international standard for energy
management. The benefits of formalising
management systems and approaches through
internationally-recognised standards have been
proven through the long experience of ISO 9001
for quality management and ISO 14001 for
environmental management. These two
standards are universally recognised and
increasingly demanded in the commercial sector
– in fact ISO 9001 has become the basic minimum
requirement demanded of most purchasers when
buying from manufacturing organisations.
Discussions about an international energy
management standard began as long ago as
2005, and in 2008 the International Standards
Organization (ISO) established a project
committee to develop the standard. Using the
Plan-Do-Check-Act template of ISO 9001 and ISO
14001 and building upon existing standards
(especially PrEN 16001 in the EU), ISO 50001 was
launched in 2011.
A number of UK organisations, such as Northern
Rail, Bentley Motors and Whitbread, have already
adopted the new standard. There is also a
growing list of certified international
organisations, and these early adopters all
reportii that significant energy savings have been
achieved through adopting a structured
approach to energy management.
The structure of ISO 50001 is identical to other
management standards and follows the classical
‘Deming cycle’ of continuous improvement: Plan-
Do-Check-Act. ISO 50001 involves implementing
a robust EnMS (Figure 2) that provides a
framework for a systematic approach to
monitoring and analysing energy use and,
crucially, identifying areas for performance
improvement and the establishing of energy
objectives and targets.

Figure 2. Energy Management System Model for
ISO 50001 [Source: ISO ‘Win the Energy
Challenge with ISO 50001’]
This process will be familiar to any organisation
that has implemented ISO 14001 or 9001 where a
team approach, across all levels of the business, is
adopted and regular internal audits are a key tool
for keeping the system in order and on track.
Energy use is often a ‘significant aspect’ of
environmental management standard ISO 14001
because energy consumption almost inevitably
results in CO
2
emissions. ISO 50001, however,
focuses purely upon energy and differentiates
itself from the other standards by being a
performance standard, in that there is a
requirement to not just manage energy but also
to reduce it. This process of improving of energy
efficiency starts with the establishing of a
baseline, from which future performance and
efficiency can be measured.
At the most basic level, a simple baseline will be
historical consumption. With a more
sophisticated approach, though, the factors that
drive energy use, such as production or external

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temperatures, are identified – and the baselines
of individual departments, buildings or
production lines are established. With this more
detailed approach, true energy savings can be
identified as opposed to fluctuations caused by a
dip in production levels or warmer weather.
Implementation of ISO 50001 requires first and
foremost senior management commitment which,
in practical terms, means that adequate resources
must be devoted to the process. Like ISO 14001, a
team approach, as discussed, is usually adopted
and the crucial early stages of planning and
establishing baselines may require significant
resources. How much will depend on the size and
complexity of the organisation and how much
effort has already been dedicated to energy
management.
ISO 50001 is a journey of continuous
improvement and not a destination, so the
ongoing system support will require inputs from
a variety of functions on a continual basis.
However, the system monitoring requirements of
ISO 50001 will ensure that any savings achieved
will be identified, tracked and recorded – making
it possible to quantify the cost savings associated
with the standard.
EARLY ADOPTER CASE STUDIES
DELTA ELECTRONICS, CHINA
Delta Electronics, a supplier of power and thermal
management solutions, achieved ISO 50001
certification at its Dongguan factory in China. The
standard is fundamental to the company’s five-
year energy-saving goal of reducing power
consumption by 50% in 2014, compared with
2009.
Factory manager Rock Huang said: “We have
already reduced power consumption by 10.51
million kWh as compared to the same period in
2010. This is equivalent to a reduction of 10.2
thousand tonnes of carbon emissions and a
saving of CNY 8 million.
"Power consumption was also reduced by 37% as
compared to the 74,300 kWh/million USD
production value in 2009. We are confident that
our goal of 50% reduction in 2014 is just around
the corner.”


MUNICIPALITY OF BAD EISENKAPPEL,
AUSTRIA
During the first year after certification,
consumption of electrical energy by the town
is expected to decrease by nearly 25%, with
the main savings achieved by updating the
waste water plant and reducing energy
consumption by 86,000 kWh – equivalent to
EUR 16,000.
Street lights will be converted to LED bulbs in
combination with movement sensors and PV-
modules, all of which are estimated to save a
further 45,000 kWh. In addition, LED-bulbs
have been installed in public buildings and
local schools, aerators fitted to taps, and
improvements made to municipal ventilation
systems and the warm water supply.
Potential savings have also been identified
during thermal imaging of buildings, and from
the planned installation of thermal solar
collectors.
According to Mayor Franz Josef Smrtnik,
adopting an energy management system was
important because “continuous energy savings
make budgets available for other important
issues, and local energy resources create added
value in the region.”
VOLVO NEW RIVER VALLEY, VIRGINIA,
U.S.A
The plant was the first U.S. facility to be certified
to the ISO 50001 standard. Managers set a 10-
year target to reduce the intensity of energy per
unit by 25%. They met this target in one year and
many of the energy-saving ideas came from
employees.
COOK COMPOSITES AND POLYMERS
COMPANY, HOUSTON, U.S.A
The plant achieved a 14% improvement in energy
efficiency over two years without any capital
investments. There is now a management system
in place to proactively sustain improvements in
energy resources.



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CONCLUSIONS
Based upon experience to date and a detailed
comparison of the standards, and with its focus
purely on energy, ISO 50001 fulfils a gap in the
ISO 14001 environmental management standard.
The standard is a target-driven approach to
improving energy performance and hence driving
down energy costs by developing a system of
continuous improvement.
The standard is bound to appeal to energy-
intensive organisations where control of energy
costs is vital to profitability. Other organisations
with a strong commitment to limiting their
environmental impact by reducing their CO
2

emissions will also appreciate its value.
Energy use and climate change are high-profile
political issues, and a number of Government
agencies around the world are backing the
introduction of ISO 50001. The U.S. Department
of Energy, for example, is offering online support,
webinars and workshops to help companies
understand and use the standard
iii
.
In Germany, energy-intensive businesses will
receive a rebate on ‘eco-taxes’ applied to energy
– provided that they demonstrate improved
energy efficiency and achieve ISO 50001
certification
iv
.
The upward pressure on energy prices in the UK
is likely to continue for the long term, driven by
environmental policy, scarcity of domestic supply
and political instability in oil-producing regions.
In the face of this, ISO 50001 can deliver
significant savings, thereby improving
profitability. In addition, it helps organisations
reduce emissions and demonstrate their
environmental commitment.
REFERENCES

i

www.decc.gov.uk/en/content/cms/statistics/energy_s
tats/prices/prices.aspx

ii

www.iso.org/iso/iso-magazines/iso-focus-
plus_index/iso-focusplus_online-bonus-
articles/bonus_iso-50001_adopters.htm

iii

www1.eere.energy.gov/manufacturing/tech_deploym
ent/ecenter_getstarted.html

iv

www.bmu.de/files/english/pdf/application/pdf/energie
konzept_bundesregierung_en.pdf





























by Lucideon

ABOUT LUCIDEON

Lucideon is a leading international provider of
materials development, testing and assurance.
Through its offices and laboratories in the UK, US
and the Far East, Lucideon provides materials
and assurance expertise to clients in a wide range
of sectors, including healthcare, construction,
ceramics and power engineering.
The company aims to improve the competitive
advantage and profitability of its clients by
providing them with the expertise, accurate
results and objective, innovative thinking that
they need to optimise their materials, products,
processes, systems and businesses.