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ISO 50001: What will the new standard mean to B.C. industry?

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The new international energy management standard, ISO 50001, is expected to be published soon. For the first time, there will be a management system standard providing a structured approach to continuous improvement (and continuous saving) related to energy efficiency.

"ISO 50001 will institutionalize energy management practices," says Kevin Wallace, Industrial Marketing Manager for BC Hydro Power Smart. "Companies may already be implementing energy management on an operational level. But the standard brings the continuous improvement element, and helps formalize energy management practices in the organization.

"That provides for sustained savings, independent of any one individual or any one project."

BC Hydro's role

BC Hydro has played an active role in the development of the new standard, as a member of the ISO 50001 implementation task force of the Standards Council of Canada. Wallace says the utility is assessing what the new standard will mean for B.C. companies.

So far, he expects the bottom line impact of reduced energy costs will be the main value of adopting the standard, rather than compliance or supply chain benefits in the immediate term. To facilitate companies with their efficiency efforts, BC Hydro will ensure its initiatives support companies in ISO 50001 efforts they undertake.

"We're assessing the value of ISO 50001 to industrial companies and we're assessing the gaps between our programs and the standard itself," says Wallace. "We'll work to adjust our programs to align with the new standard once it is published."

CSA Standards ISO 50001 Workshop

Wallace is co-hosting, in partnership with CSA, a workshop about the "ABCs" of ISO 50001 to provide an overview of the new standard for companies interested in learning more.

Facilities Management 2.0 and ISO 50001

In last month's Current newsletter, energy management consultant Christopher Russell offered his comments about his approach to energy management, which he calls "Facilities Management 2.0."

Author of the Energy Pathfinder blog, Russell focuses on the connection between energy management and business performance, and how facilities managers have an opportunity to turn their operations into profit centres.

This month, Christopher Russell responds to questions about ISO 50001.

1. How does ISO 50001 relate to your ideas in Facilities Management 2.0?

ISO 50001 increases the methodological rigour and integrity of industrial energy management principles. Without it (and its predecessors), energy management remains an ad hoc pursuit that defies comparison and replication across multiple facilities. With ISO 50001, practitioners leverage a common base of knowledge, procedures, and metrics.

Like any industry standard, it economizes the use of resources by reducing the need to "reinvent the wheel." The performance metrics spawned by ISO 50001 are immediately relevant to cross-sectional and time-series analysis. A management standard, by virtue of its rigorous design, implementation, and certification, allows practitioners to confidently declare and quantify their accomplishments.

But for all its structural integrity, ISO 50001 reflects the classic "build it and they will come" philosophy. There needs to be a genuine desire on the part of practitioners to actually achieve the outcomes that ISO 50001 facilitates. That desire will be spawned by increased education and awareness of key stakeholders at corporate as well as facility levels.

Much has been said in energy management literature about the need for top-down direction. That truth generally still holds. But organizational dynamics are more complicated than that.

Consider the peculiar history of facilities management over the past two or three decades – an era defined by cutbacks and retrenchment. As a result, many facility departments operate today with a bunker mentality, motivated more by territorial defence than by efficiency, per se. Scant acknowledgement is given to these organizational dynamics when promoting energy efficiency to the industrial sector.

For this reason, Facilities Management 2.0 is a progressive philosophy for facility-level decision makers to adopt and evolve into a new paradigm for professional relevance and achievement. This enlightenment should directly stimulate the demand for ISO 50001.

2. If a company adopts the ISO 50001 standard, can they be confident they're doing all they can to ensure good energy management (and good cost reduction)?

I'll answer this with an analogy. Compare three couples, each considering a life-long commitment to each other. Couple A has a chemistry of genuine love and partnership, but they decide to forfeit the formality of marriage. Couple B is superficial, pursuing marriage specifically for the bachelor party, bridal registry and other perks that come with the wedding itself. Finally, Couple C has both genuine love plus an added desire for the legal, civil and societal security that accrue to a formally institutionalized marriage.

I contend that various companies will pursue ISO 50001 for reasons that parallel my "three couples" analogy. There are those that will implement energy improvements and reap the rewards without embracing the formality of a management standard. Then there are companies that will be attracted to the marketing benefits that accrue with certification. Finally, there are those companies that will seek growth and rewards through dedicated implementation of ISO 50001.

In this last example, I think, we find the basis for practitioners' confidence, as well as their durable energy performance improvement.

3.The ISO standard isn't out yet. In your opinion, is it better to wait until the standard is published and then start on energy management with a firm platform and standardized approach, or is it better to start as soon as possible, even without a standard in place?

Remember that there's such a thing as the "cost of doing nothing." It's relatively easy to quantify the magnitude and rate of "capital recovery in reverse" caused by energy waste. This is a way to measure the risk and rewards of acting sooner rather than later.