(updated 11.09.2024.)

There seems to be a low level of understanding of what energy management is even in many established organisations. Many are not aware that energy management is a very effective strategy for lowering business costs in any building, facility, site or district.

Energy management deals with actual energy (electricity, gas, steam, heating and fuel oil) and water consumption, which an organisation has complete control over. Energy management is:

• measuring and monitoring energy and water consumption
• identify opportunities to save energy and water by analysing data
• implementing measures to use energy and water more efficiently
• measuring and monitoring energy and water consumption on an ongoing basis

We take a more detailed look at each of these areas in our article ‘What is energy management’. For now it is enough to say that optimal management of existing energy resources and water with the aim of improving a business’s energy efficiency ultimately leads to cost savings.

For instance, by lowering your thermostat by just 1˚C, you can save around 5% of energy used for heating per year or by replacing an old fuel oil boiler with a condensing gas boiler you can lower energy costs by 73% (UNDP). Energy efficient lightbulbs, such as halogen lightbulbs, compact fluorescent lamps and LEDs can typically use about 25%-80% less energy than traditional incandescents, saving you money and they last 3-25 times longer.

But energy management makes business sense on many more levels. In addition to the economic benefits, energy management…

Reduces risk to your business from rising energy prices

Energy management can help protect the business from rising energy prices and supply shortages. As a result of the war in Ukraine, the prices of gas and oil have significantly increased, further highlighting the need to reduce reliance on fossil fuels. With rising global demand (an estimated increase of 48% between 2012 and 2040 according to the International Energy Agency) and constraints in the supply of fossil fuels and potable water, the costs of energy and water will continue to rise. This could seriously affect the profitability of your company, especially if you are a high energy consumer. By reducing your demand for energy and water and therefore your dependency, you reduce the risk to your business.

Energy efficiency: the inevitable future of business

In light of the new European Union goals under the European Green Deal, Croatia is committed to achieving climate neutrality by 2050. This includes more ambitious targets for reducing greenhouse gas emissions, increasing energy efficiency, and boosting the share of renewable energy in total energy consumption. Recent EU goals include reducing greenhouse gas emissions by at least 55% by 2030 compared to 1990 levels.

The Government’s National Energy and Climate Plan (NECP) for the period 2021-2030 outlines strategic frameworks and programs to enhance energy efficiency across all sectors of the economy. Investing in energy efficiency measures is becoming a crucial strategy for long-term business success. Not only does investing in energy measures reduce operational costs and greenhouse gas emissions, but it also increases a company’s competitiveness in the market. In today’s business environment, where environmental responsibility and economic efficiency are closely linked, energy efficiency is not just an advantage but a necessity for every business entity.

Social and Environmental Benefits of Energy Efficiency: Resource Conservation and Emission Reduction

The growing emphasis on energy efficiency delivers significant social and environmental advantages. By minimizing energy consumption and reducing dependence on fossil fuels, businesses contribute to the preservation of natural resources and help mitigate environmental impact. Lowering the use of water and fossil fuels aids in conserving these essential resources and slows the depletion of natural reserves, which in turn can influence future pricing and availability.

Moreover, fossil fuels such as oil, coal, and natural gas are major sources of carbon emissions. Reducing reliance on these energy sources is crucial for decreasing greenhouse gas emissions and combating climate change. According to the International Energy Agency, improving energy efficiency in buildings, industrial processes, and transportation could cut global energy needs by a third by 2050 and positively impact global greenhouse gas emissions.

In conclusion, effective energy management is crucial for businesses today. It leads to significant cost savings, enhances operational efficiency, and reduces environmental impact. With the EU’s commitment to climate neutrality and available funding for energy efficiency projects, businesses can lower investment costs and improve returns. Embracing energy efficiency is not just an advantage – it’s essential for long-term success and sustainability.