“What kind of payback did you get?”
“What is the return-on-investment?”
These are two questions that any Energy Manager who has implemented or even proposed an energy project will invariably be asked.
Granted, economic viability is an important part of the business case for energy projects (or any project, actually). Projects firstly have to be practical and affordable, but simple paybacks and return-on-investments (ROIs) should not be the only part of the business case. By focusing on non-energy benefits (NEBs) of a project, and the overall value that a project brings, you increase your chances of securing funding, align key partners needed to ensure successful implementation, better integrate energy management into your organisation, and hopefully smooth the path for future opportunities. As a matter of fact, including NEBs can often help move ahead projects where the payback and ROI are not that strong.
Non-energy benefits will differ between organisations and even projects, but they should always be considered when planning your business case. And while it’s sometimes possible to put a dollar figure to NEBs, it may not always be necessary.
Although saving energy does help with the “bottom line”, it is important to recognise that energy efficiency is not a company’s core business, and therefore must compete with numerous other initiatives in order to proceed. Rounding out your business case to include non-energy benefits helps demonstrate how energy management initiatives can make life better for others in your organisation, making your project stand out and greatly increasing the chances of it being successfully implemented.
Learn more about this topic. Read the top 5 energy-related questions to ask when preparing a business case.
Ed Rubinstein is a trainer in CIET’s Certified Energy Manager (CEM) course. Ed is the Energy & Environment Manager at the University Health Network. He’s been leading the hospital’s many environment programs since 1999 and has helped UHN become a leader in greening health care. Both UHN and Ed’s leadership in the field of “greening health care” have been recognized by several awards, including from the Ontario Hospital Association, Natural Resources Canada, Practice Greenhealth and the Canadian Council of Ministers for the Environment.
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