Energy Management System: Fundamentals for Success

Submitted by Acriziomar Alves on Tue, 06/23/2020 - 18:23
Sistema de Gestão de Energia: fundamentos para o sucesso


Learn how the implementation of an energy and utilities system, based on the PDCA method, brings positive gains to your business in energy and utilities management.


The costs involving energy and utilities in corporations are representative (10 to 20% in steel-making, 70% in the aluminum industry and production of atmospheric gases) and the topic has been widely discussed in a number of Brazilian and international forums. In addition, the consumption of these is intimately linked to the emission of CO2, which is a global concern and has been the focus of many companies and governments around the world. Efficient management of these resources is therefore essential.

When speaking of management, one immediately thinks of a Management System: first of all what is a Management System?

In Vicente Falconi’s book "True Power," a Management System is defined as a “set of actions interconnected in such a way that results are achieved1.” Starting from this statement, according to the same author, to have a Management System three basic pillars are needed: Leadership, Technique, and Method.

The Pillars of the Management System

Figure 1 – The Pillars of the Management System 

Leadership is the role of the leader, who, according to Professor Falconi’s definition, is the person who sets goals via their team in an ethical way. That is, the leader provides all of the support and motivation needed by the team to achieve the established goals.

Technique, or technical knowledge, is to know what is to be done and master the mechanisms encompassed in the processes, with a view to the best practices adopted in the market.

Method is word of Greek origin: Methodos, a combination of metá (goal) and hodós (way); Method can therefore be understood as the “way to achieve the goal.” The method proposed by René Descartes in 1600 came to light from his work "Discourse on the Method." It concerns the existence of a systemtatic process in the search for knowledge to achieve objectives/goals.

In line with the three pillars, to have efficient energy and utilities management the following are needed:

Leadership, the topic of energy and utilities should be important for the company. High-level leadership needs to be involved from the beginning because it is the leader who will define with the team the goal to be achieved. For this to occur, energy gaps should be identified in all of the energy consumption processes in a way that the goals are technically established based on these gaps. In this sense it is crucial to have measurement of the consumption and generation of the principle energy inputs.

Information, knowledge, and analytical capacity

Figure 2 – Information, knowledge, and analytical capacity

Technical knowledge: its importance is primarily related to how to achieve the established goals. It is the knowledge incorporated into processes and operations by people, so achieving goals is nothing more than a process of team learning, which takes time. According to Falconi, “The only reason for not always having the result you want is not knowing how to achieve it, because if you knew how, it would have happenedi2.” For this reason it is of the utmost importance that the energy and utilities team be multidisciplinary, disciplined, and knowledgeable about the processes for which they are responsible and familiar with applicable legislation; after all, 70% of the result is intrinsically connected to people!

Results connected to people

Figure 3 - Results connected to people 

Method, PDCA, a widely known methodology, is an example of the Cartesian method which, when applied well, becomes a very powerful tool in the management of energy and utilities. That is, to have true management the method is indispensable.

PDCA Cycle

Figure 4 - PDCA Cycle


PLAN: In energy and utilities management, in this step energy gaps are sought by benchmarking between plants, sectors, and the market. Identify which are the most significant consumers for each type of existing energy input. It is therefore important to have a reliable measurement system. Once the gaps are defined, the goal is technically set (challenging, but attainable), remembering that achieving it is a learning process that involves effort and that is connected to the human capacity to learn. Still in this phase, the few good indicators for energy performance are defined, in addition to the development of an "Action Plan," which is where the knowledge is allocated, with responsible persons defined and deadlines for each action listed.

DO: In this phase the team involved will implement the actions envisaged in the "Action Plan" developed in the previous step. In energy and utilities, execution is closely connected to day-to-day production/operation, since this is where the energy inputs are consumed.

CHECK: In this step, the results measured using energy indicators, as well as the indicators themselves, are verified, analyzed, and reviewed. In addition, the action plan should also be checked, because if the actions have not been performed, nothing changes!

ACT: Bearing in mind the energy results observed in the step, it is time to act. What was successful should be standardized and established as an energy goal to maintain, so that the knowledge acquired is not lost, and other sectors are able to replicate the good practice. What did not work should return to the first phase, planning. Starting from this point, new actions will emerge and it is up to the leader to encourage the discussions and transfer knowledge of other areas of the same organization or from outside to the new round of the Action Plan.

Therefore, the adoption of an energy and utilities management system based on Leadership, Technical Knowledge, and Method, has the result of gains that go far beyond the financial, because they drive team members to think and act in a more conscientious and sustainable way. However, it does not happen from one day to the next – it takes time.

Read more: The PDCA cycle in energy and utilities management

  1. FALCONI, Vincente True Power: Management Practices for Revolutionary Results, 2nd Edition, 2009. p. 20 [back]
  2. FALCONI, Vincente True Power: Management Practices for Revolutionary Results, 2nd Edition, 2009, p. 28 [back]
Energy Management Analyst, Viridis

Acriziomar Alves is an Energy Management Analyst at Viridis, working in Energy Management and Strategic Planning at Bayer. He holds a bachelor's degree from the Brazilian Federal University of Uberlândia in electrical engineering with a focus on power systems. Mr. Alves has participated in R&D projects with Petrobrás, with research directed toward the creation of computational models for power flow analysis and energy quality.

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