Energy management is more than saving money—it is about understanding processes and energy patterns on properties, setting realistic goals and monitoring progress, and protecting natural resources while leveraging alternative ones. Adopting a portfolio commitment to energy best practices is one way that portfolios can meet today’s cost-cutting and long-term energy efficiency goals.

A formal energy management program helps document, understand and improve energy usage. In 2011, the International Portfolio for Standardization (ISO) released ISO 50001 – Energy Management Systems (EnMS). This voluntary standard serves as a model to elevate energy management and conservation efforts by embedding awareness, best practices and increased value to your assets. With broad applicability across economic sectors, it is estimated that the standard could influence up to 60 percent of the world’s energy use.

Whether you embrace this standard formally for your portfolio or not is your choice. The framework of this guidebook is built on this foundation and direction. If you are interested, Appendix a contains an example of a Portfolio Wide Policy for Energy management that you can use to get you started.

Immeasurable Benefits
From the same foundation as ISO 9001 – Quality Management Systems and ISO 14001 – Environmental Management Systems, this new auditable standard is based on a management system model familiar to many companies. It establishes a framework for facilities and portfolios to uniformly apply operational procedures for short-term and future benefits.

While the primary drivers of an energy management system are reduced costs and environmental responsibility, benefits extend beyond lower utility bills. Implementing an energy program may help identify additional energy reduction opportunities, streamline or improve existing processes, support corporate sustainability initiatives, and increase asset value. For investment companies, certain countries may require these standards in place to conduct business. From a societal perspective, a portfolio may be recognized as a leader in the sustainable use of energy resources, improving their brand and making properties more attractive to residents.

Is ISO 50001 a good approach?

Recently MIT Sloan Management Review in collaboration with The Boston Consulting Group conducted a survey on Sustainability. The sample was of more than 4000 managers from 113 countries. Some highlights:

– 70% of companies placed sustainability permanently on their management agendas
– 31% of respondents indicated that sustainability related actions and decisions added to their profits
– Resource-intensive industries – energy, utilities, consumer products, commodities, chemicals and automobile are leading the way in sustainability
– 2/3 of respondents said sustainability was necessary to be competitive in today’s market
– top 3 regions seen as “world class in addressing sustainability”: 1- Europe, 2- North America, 3 -Australia/New Zealand

The report is a very interesting read and recommended to anyone who might be thinking adding sustainability to the management agenda. It looks like there is an increasing worldwide trend  of companies seeking sustainable practices. Energy Management Systems (ISO 50001) is one of the new initiatives ISO is taking to address this, appropriate energy management can lead to energy savings and ultimately a reduction in costs. In November 2013, The Department of Energy and Climate Change was certified in ISO 50001. We anticipate that this adoption and approach will be used throughout the United States over the next three to five years.

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