TLFeBOOK
ENERGY MANAGEMENT
HANDBOOK
SIXTH EDITION
Eric Angevine
School of Architecture
Oklahoma State University
Stillwater, OK
Bradley Bracher
Oklahoma City, OK
Barney Burroughs
Indoor Air Quality Consultant
Alpharetta, GA
Barney L. Capehart
Industrial Engineering
University of Florida
Gainesville, FL
Clint Christenson
Industrial Engineering
Oklahoma State University
Stillwater, OK
David E. Claridge
Mechanical Engineering Department
Texas A&M University
College Station, Texas
William E. Cratty
Ventana Corporation
Bethal, CT
Charles Culp
Energy Systems Laboratory
Texas A&M University

College Station, Texas
Steve Doty
Colorado Springs Utilities
Colorado Springs, CO
Keith Elder
Coffman Engineers, Inc.
Seattle, WA
John L. Fetters, CEM, CLEP
Effective Lighting Solutions, Inc.
Columbus, Ohio
Carol Freedenthal, CEO
Jofree Corporation,
Houston, TX
GSA Energy Consultants
Arlington, VA
Richard Wakefi eld
Lynda White
Jairo Gutiemez
Dale A. Gustavson
Consultant
Orange, CA
Jeff Haberl
Energy Systems Laboratory
Texas A&M University
College Station, Texas
Michael R. Harrison, Manager
Engineering & Technical Services
Johns-Mansfi eld Corporation
Denver, CO
Russell L. Heiserman

School of Technology
Oklahoma State University
Stillwater, OK
William J. Kennedy, Jr.
Industrial Engineering
Clemson University
Clemson, SC
John M. Kovacik, Retired
GE Industrial & Power System Sales
Schenectady, NY
Mingsheng Liu
Architectural Engineering
University of Nebraska
Lincoln, NB
Konstantin Lobodovsky
Motor Manager
Penn Valley, CA
Tom Lunneberg
CTG Energetics, Inc.
Irvine, CA
William Mashburn
Virginia Polytechnic Institute and
State University
Blacksburg, VA
Javier Mont
Johnson Controls
Chesterfi eld, MO
George Owens
Energy and Engineering Solutions
Columbia, MD

Les Pace
Lektron Lighting
Tulsa, OK
Jerald D. Parker, Retired
Mechanical & Aerospace Engineering
Oklahoma State University
Stillwater, OK
S.A. Parker
Pacifi c Northwest National Laboratory
Richland, WA
David Pratt
Industrial Enginneering and Management
Oklahoma State University
Stillwater, OK
Wesley M. Rohrer
Mechanical Engineering
University of Pittsburgh
Pittsburgh, PA
Philip S. Schmidt
Department of Mechanical Engineering
University of Texas
Austin, TX
R. B. Scollon
Manager, Energy Conservation
Allied Chemical Corporation
Morristown, NJ
R. D. Smith
Manager, Energy Generation & Feed Stocks
Allied Chemical Corporation
Morristown, NJ

Mark B. Spiller
Gainesville Regional Utilities
Gainesville, FL
Nick Stecky
NJS Associates, LLC
Albert Thumann
Association of Energy Engineers
Atlanta, GA
W.D. Turner
Mechanical Engineering Department
Texas A&M University
College Station, Texas
Alfred R. Williams
Ventana Corporation
Bethel, CT
Larry C. Witte
Department of Mechanical Engineering
University of Houston
Houston, TX
Jorge Wong Kcomt
General Electric, Evansville, IN
Eric Woodroof
Johnson Controls, Santa Barbara, CA
EDITORIAL BOARD
EDITOR ASSOCIATE EDITOR
Wayne C. Turner Steve Doty
School of Industrial Engineering and Management Colorado Springs Utilities
Oklahoma State University Colorado Springs, Colorado
Stillwater, Oklahoma
CONTRIBUTORS

ENERGY MANAGEMENT
HANDBOOK
SIXTH EDITION
BY
WAYNE C. TURNER
SCHOOL OF INDUSTRIAL ENGINEERING AND MANAGEMENT
OKLAHOMA STATE UNIVERSITY
AND
STEVE DOTY
COLORADO SPRINGS UTILITIES
COLORADO SPRINGS, COLORADO
iv
Library of Congress Cataloging-in-Publication Data
Turner, Wayne C., 1942-
Energy management handbook / by Wayne C. Turner & Steve Doty. 6th ed.
p. cm.
Includes bibliographical references and index.
ISBN: 0-88173-542-6 (print) — 0-88173-543-4 (electronic)
1. Power resources Handbooks, manuals, etc. 2. Energy conservation
Handbooks, manuals, etc. I. Doty, Steve. II. Title.
TJ163.2.T87 2006
658.2'6 dc22
2006041263
Energy management handbook / by Wayne C. Turner & Steve Doty
©2007 by The Fairmont Press, Inc. All rights reserved. No part of this publica-
tion may be reproduced or transmitted in any form or by any means, electronic
or mechanical, including photocopy, recording, or any information storage and
retrieval system, without permission in writing from the publisher.
Published by The Fairmont Press, Inc.
700 Indian Trail

Lilburn, GA 30047
tel: 770-925-9388; fax: 770-381-9865

Distributed by Taylor & Francis Ltd.
6000 Broken Sound Parkway NW, Suite 300
Boca Raton, FL 33487, USA
E-mail:
Distributed by Taylor & Francis Ltd.
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E-mail:
Printed in the United States of America
10 9 8 7 6 5 4 3 2 1
0-88173-542-6 (The Fairmont Press, Inc.)
0-8493-8234-3 (Taylor & Francis Ltd.)
While every effort is made to provide dependable information, the publisher, authors, and
editors cannot be held responsible for any errors or omissions.
v
CONTENTS
Chapter Page
1 Introduction 1
Background 1
The Value of Energy Management 2
The Energy Management Profession 3
Some Suggested Principles of Energy Management 5
2 Effective Energy Management 9
Introduction 9
Energy Management Program 9
Organizational Structure 10

Energy Policy 13
Planning 13
Audit Planning 14
Educational Planning 15
Strategic Planning 16
Reporting 16
Ownership 17
Summary 17
3 Energy Auditing 23
Introduction 23
Energy Auditing Services 23
Basic Components of an Energy Audit 23
Specialized Audit Tools 33
Industrial Audits 34
Commercial Audits 36
Residential Audits 37
Indoor Air Quality 37
4 Economic Analysis 41
Objective 41
Introduction 41
General Characteristics of Capital Investments 42
Sources of Funds 43
Tax Considerations 44
Time Value of Money Concepts 46
Project Measures of Worth 54
Economic Analysis 58
Special Problems 64
Summary and Additional Example Applications 69
vi
5 Boilers and Fired Systems 87

Introduction 87
Analysis of Boilers and Fired Systems 87
Key Elements for Maximum Effi ciency 89
Fuel Considerations 116
Direct Contact Technology for Hot Water Production 122
6 Steam and Condensate Systems 125
Introduction 125
Thermal Properties of Steam 126
Estimating Steam Usage and its Value 133
Steam Traps and Their Application 139
Condensate Recovery 147
7 Cogeneration 155
Introduction 155
Cogeneration System Design and Analysis 157
Computer Programs 174
U.S. Cogeneration Legislation: PURPA 176
Evaluating Cogeneration Opportunities: Case Examples 178
8 Waste-Heat Recovery 193
Introduction 193
Waste-Heat Survey 201
Waste-Heat Exchangers 207
Commercial Options in Waste-Heat-Recovery Equipment 211
Economics of Waste-Heat Recovery 218
9 Building Envelope 221
Introduction 221
Principles of Envelope Analysis 223
Metal Elements in Envelope Components 225
Roofs 230
Floors 233
Fenestration 234

Infi ltration 237
Summarizing Envelope Performance with the Building Load Coeffi cient 239
Thermal “Weight” 240
Envelope Analysis for Existing Buildings 240
Envelope Analysis for New Buildings 245
Updated Envelope Standards for New and Existing Construction 245
Additional Reading 246
10 HVAC Systems 247
Introduction 247
Surveying Existing Conditions 247
Human Thermal Comfort 248
HVAC System Types 249
Energy Conservation Opportunities 259
Cooling Equipment 269
Domestic Hot Water 271
Estimating HVAC Energy Consumption 272
vii
11 Electric Energy Management 273
Introduction 273
Power Supply 273
Effects of Unbalanced Voltages on the Performance of Motors 274
Effect of Performance-General 274
Motor 275
Glossary of Frequently Occurring Motor Terms 275
Power Factor 279
Handy Electrical Formulas & Rules of Thumb 281
Electric motor Operating Loads 281
Determining Electric Motor Operating Loads 282
Power Meter 282
Slip Measurement 282

Amperage Readings 284
Electric Motor Effi ciency 284
Comparing Motors 286
Sensitivity of Load to Motor RPM 290
Theoretical Power Consumption 291
Motor Effi ciency Management 294
Motors Are Like People 294
Motor Performance Management Process 294
How to Start MPMP 295
Nameplate Glossary 298
12 Energy Management Control Systems 315
Energy Management Systems 315
Justifi cation of EMCSs 321
Systems Integration 326
13 Lighting 353
Introduction 353
Lighting Fundamentals 353
Process to Improve Lighting Effi ciency 367
Maintenance 368
New Technologies & Products 370
Special Considerations 379
Daylighting 383
Common Retrofi ts 385
Schematics 390
Glossary 397
14 Energy Systems Maintenance 401
Developing the Maintenance Program 401
Detailed Maintenance Procedures 413
Materials Handling Maintenance 421
Truck Operation and Maintenance 423

Measuring Instruments 426
Saving Energy Dollars in Materials Handling and Storage 430
Recent Developments 433
15 Industrial Insulation 437
Fundamentals of Thermal Insulation Design Theory 437
viii
Insulation Materials 439
Insulation Selection .443
Insulation Thickness Determination 448
Insulation Economics 461
16 Use of Alternative Energy 471
Introduction 471
Solar Energy 471
Wind Energy 484
Refuse-Derived Fuel .489
Fuel Cells 493
17 Indoor Air Quality 497
Introduction and Background 497
What is the Current Situation 499
Solutions and Prevention of IAQ Problems .500
18 Electric and Gas Utility Rates for Commercial and Industrial Consumers 507
Introduction 507
Utility Costs .507
Rate Structures 508
Innovative Rate Type 509
Calculation of a Monthly Bill 510
Conducting a Load Study 513
Effects of Deregulation on Customer Rates 516
19 Thermal Energy Storage 519
Introduction 519

Storage Systems 521
Storage Mediums 523
System Capacity 526
Economic Summary 532
20 Codes Standards & Legislation 539
The Energy Policy Act of 1992 539
State Codes 540
Model Energy Code 541
Federal Energy Effi ciency Requirements 541
Indoor Air Quality Standards 542
Regulations & Standards Impacting CFCs 543
Regulatory and Legislative Issues Impacting Air Quality 544
Regulatory and Legislative Issues Impacting Cogeneration & Power 545
Opportunities in the Spot Market 546
The Climatic Change Action Plan 547
21 Natural Gas Purchasing 549
Preface 549
Introduction 550
Natural Gas as a Fuel 553
Buying Natural Gas 566
New Frontiers for the Gas Industry 575
ix
22 Control Systems 577
Introduction 577
Why Automatic Control? 577
Why Optimization? 578
Technology Classifi cations 578
Control Modes 580
Input/Output Devices 584
Valves and Dampers 586

Instrument Accuracy, Repeatability, and Drift 588
Basic Control Block Diagrams 589
Key Fundamentals of Successfully Applied Automataic Controls 590
Operations and Maintenance 592
Expected Life of Control Equipment 592
Basic Energy-saving Control Applications 594
Advanced Energy-saving Control Applications 594
Facilities Operations Control Applications 594
Control System Application Pitfalls to Avoid 601
Costs and Benefi ts of Automataic Control 601
Estimating Savings from Applied Automatic Control Systems 601
Conclusion and Further Study 605
Glossary of Terms 616
23 Energy Security and Reliability 621
Introduction 621
Risk Analysis Methods 624
Countermeasures 630
Economics of Energy Security and Reliability 632
Links to Energy Management 633
Impact of Utility Deregulation 634
24 Utility Deregulation and Energy System Outsourcing 637
Introduction 637
An Historical Perspective of the Electric Power Industry 637
The Transmission System and The Federal Regulatory Commission's
(FERC) Role in Promoting Competition in Wholesale Power 638
Stranded Costs 639
Status of State Electric Industry Restructuring Activity 640
Trading Energy—Marketers and Brokers 640
The Impact of Retail Wheeling 640
The Ten-Step Program to Successful Utility Deregulation 641

Aggregation 643
In-house vs. Outsourcing Energy Services 643
25 Financing Energy Management Projects 649
Introduction 649
Financial Arrangements: A Simple Example 649
Financial Arrangements: Details and Terminology 652
Applying Financial Arrangements: A Case Study 653
"Pros" & "Cons" of Each Financial Arrangement 664
Characteristics that Infl uence which Financial Arrangement is Best 665
Incorporating Strategic Issues when Selecting Financial Arrangements 666
x
Glossary 666
26 Commissioning for Energy Management 671
Introduction to Commissioning for Energy Management 671
Commissioning Defi nitions 671
The Commissioning Process in Existing Buildings 672
Commissioning Measures 680
Ensuring Optimum Building Performance 695
Commissioning New Buildings for Energy Management 702
Additional Information 704
27 Measurement and Verifi cation of Energy Savings 707
Introduction 707
Overview of Measurement and Verifi cation Methods 711
28 Ground-source Heat Pumps Applied to Commercial Buildings 755
Abstract 755
Background 755
Introduction to Ground-source Heat Pumps 756
About the Technology 757
Application 767
Technology Performance 771

Hypothetical Case Studies 774
The Technology in Perspective 781
Manufacturers 783
For Further Information 785
29 Sustainability and High Performance Green Buildings 793
Beginnings 793
Sustainability Gives Rise to the Green Building Movement 794
Introducing the LEED NC Rating System: A Technical Review 798
LEED for Existing Building Rating System (LEED-EB) Adopted in 2004 801
Summary Discussion of Two New LEED Programs 804
The LEED Process 805
ASHRAE Guides Developed to Support LEED 808
Appendix I—Thermal Sciences Review 815
Appendix II—Conversion Factors and Property Tables 837
Appendix III—Review of Electrical Science 887
Index 901
xi
FOREWORD TO THE SIXTH EDITION
Since its fi rst edition was published more than two decades ago, Energy Management
Handbook has remained the leading reference of choice used by thousands of energy manage-
ment professionals for one fundamental reason. With this new edition, Dr. Turner and Mr.
Doty continue to bring readers both the cutting-edge developments they need to know about,
as well as the broad scope of practical information they must have to accomplish real and
signifi cant energy cost reduction goals. No other single publication has been as infl uential in
defi ning and guiding the energy management profession.
This new sixth edition builds upon and is no less essential than its predecessors. Compre-
hensive in scope, it provides today’s energy managers with the tools they will require to meet
the challenges of a new era of predicted rising energy costs and supply uncertainties—ongo-
ing developments which seem certain to impact virtually every aspect of the cost of doing
business in the decades ahead. The new edition also examines the impact of the passage and

implementation of the Energy Policy Act of 2005, which puts in place new energy effi ciency
requirements for government facilities, as well as energy-effi ciency-related tax incentives for
commercial buildings.
As evidence continues to lend credence to the reality of global climate change, a growing
number of businesses are seeing the “good business sense” of reducing greenhouse emissions
and developing sustainable, green facilities. The sixth edition of Energy Management Handbook
includes substantial new material on sustainability, high performance facilities and related
technologies.
In many ways the evolution of Energy Management Handbook has paralleled that of the
Association of Energy Engineers (AEE) in meeting the needs of and setting the standards for
the modern energy management profession which has emerged since the 1970s. Therefore,
it seems very appropriate that the publication of this important new sixth edition offi cially
kicks off AEE’s 30
th
anniversary celebration. As our organization completes its third decade
of serving more than 8,000 members in 77 countries, it would be nearly impossible to over-
state the impact that Energy Management Handbook has had for those we serve. The book is an
offi cial reference and preparatory text for AEE’s Certifi ed Energy Manager (CEM) program,
the most widely recognized professional credential in the energy management fi eld, having
certifi ed more than 6,000 professionals since its inception in 1981. In addition numerous large
corporations have selected Energy Management Handbook as their offi cial corporate energy
management reference.
There is no doubt that Energy Management Handbook will continue its role as the indis-
pensable reference for all energy managers who must meet the daunting energy supply and
cost control challenges which lie ahead.
Albert Thumann, P.E., C.E.M.
Executive Director, The Association of Energy Engineers
April 2006
This page intentionally left blank
xiii

PREFACE TO THE SIXTH EDITION
When the fi rst introduction to Energy Management Handbook was written in 1982, I
was in college, worried more about how to repay student loans than anything else. But
this is now.
This book lives to serve its readers. In helping to edit the book, it has been my goal
to keep the material fresh, pertinent and useful. My approach has been to view it from
the reader’s perspective, and to assure that the book provides good value. I look forward
to further improvements, over time, as technologies continue to change and refi ne, since
it will keep me current in the process.
As I see it, the core intentions of this book are these:
• To address an audience of practicing energy managers and persons entering this
trade. It is a tool for energy managers to get their questions answered, and get things
accomplished.
• To provide a resource of current, accurate, useful information in a readable for-
mat.
• To emphasize applications, and include practical examples to clarify key topics,
especially savings calculations. Background development and derivations should
be limited to just what is needed to support the application messages.
For this edition, there are some signifi cant changes, including a rewrite of the au-
tomatic controls chapter, and all-new chapters on ground source heat pumps, and green
building design.
As I have learned, editors check for errors and adjust grammar or format, but do not
change the author’s message. The primary strategy for quality in this book is to choose
the very best authors, so I’ll extend my personal thanks to each of them for their contribu-
tions. And I owe Wayne Turner a debt of thanks for the opportunity to contribute. I can
only hope to do as well.
I am excited about contributing to the long-running success of this book, because
of its potential to infl uence other energy professionals, and therefore the public at large.
Writing is just writing, until it changes a behavior or helps someone get something ac-
complished—then it becomes golden!


Steve Doty
Colorado Springs, CO
April 2006
This page intentionally left blank
CHAPTER 1
INTRODUCTION
DR. WAYNE C. TURNER,
REGENTS PROFESSOR
Oklahoma State University
Stillwater, Ok.
DR. BARNEY L. CAPEHART, PROFESSOR
University of Florida
Gainesville, Fla.
STEPHEN A. PARKER
Pacifi c Northwest National Laboratory
Richland, WA
STEVE DOTY
Colorado Springs Utilities
Colorado Springs, CO
1.1 BACKGROUND
Mr. Al Thumann, Executive Director of the Asso-
ciation of Energy Engineers, said it well in the Foreword.
“The energy ‘roller coaster’ never ceases with new turns
and spirals which make for a challenging ride.” Those
professionals who boarded the ride in the late 70’s and
stayed on board have experienced several ups and
downs. First, being an energy manager was like being
a mother, John Wayne, and a slice of apple pie all in
one. Everyone supported the concept and success was

around every bend. Then, the mid-80’s plunge in energy
prices caused some to wonder “Do we really need to
continue energy management?”
Sometime in the late 80’s, the decision was made.
Energy management is good business but it needs to
be run by professionals. The Certifi ed Energy Manager
Program of the Association of Energy Engineers became
popular and started a very steep growth curve. AEE
continues to grow in membership and stature.
About the same time (late 80’s), the impact of the
Natural Gas Policy Act began to be felt. Now, energy
managers found they could sometimes save signifi cant
amounts of money by buying “ spot market” natural gas
and arranging transportation. About the only thing that
could be done in purchasing electricity was to choose
the appropriate rate schedule and optimize parameters
(power factor, demand, ratchet clauses, time of use,
etc.—see Chapter 18 on energy rate schedules).
With the arrival of the Energy Policy Act of 1992,
electricity deregulation moved closer to reality, creating
the opportunity of purchasing electricity from wherever
the best deal could be found and to wheel the electric
energy through the grid. Several states moved toward
electrical deregulation, with some successes. But there
were also some failures that made the energy industry
pause and refl ect. The prospect of electric deregula-
tion and sharing grid infrastructure caused utilities to
change their business view of their portion of the grid.
Investment in expanding or upgrading this infrastruc-
ture became risky business for individual utilities, and

so most chose to maintain the existing grid systems
they owned, with a wait-and-see approach. Through
electricity trading that manipulated pricing, problems
with implementation changed the electric deregulation
movement trend from slow to stop. Since good busi-
ness relationships are good for all, some revisions to
the EPACT-92 deregulation provisions may be necessary
to see greater acceptance, and to sustain the concept in
practice. To regain the confi dence of the consumers, a
greater degree of oversight of the business practices and
the sharing of the vital US grid infrastructure may be
necessary. This need is further accentuated by concerns
of security and reliability of our nation's electrical grid,
spurred by national events in September 2001 (9-11) and
August 2003 (Blackout). Even with the bumps as elec-
tricity deregulation was fi rst tried, wider scale electric
deregulation remains an exciting concept and energy
managers are watching with anticipation. As new skills
are learned and benefi cial industry relationships are
created, the prospects of larger scale deregulation will
improve.
However, EPACT-1992's impact is further reach-
ing. If utilities must compete with other producers of
electricity, then they must be “lean and mean.” As Mr.
Thumann mentions in the Foreword, this means many
of the Demand Side Management (DSM) and other
conservation activities of the utilities are being cut or
eliminated. The roller coaster ride goes on.
In 2005, the Bush Administration enacted the
Energy Policy Act of 2005. This Act provides new op-

portunities and incentives for energy improvements in
the country, including strong incentives for renewable
energy sources and net metering. It is hoped that the tax
incentives provided under this Act will become tools for
the private sector to spur change with the free enterprise
system. Similar in style to individual utility incentive
programs, the Act's success will depend largely on the
ability of private fi rms, such as consultants, ESCOs and
1
2 ENERGY MANAGEMENT HANDBOOK
Performance Contractors, to fi nd partnering solutions
to connect the program funding mechanism and the
customer points of use. EPACT-2005 also updates the
federal energy improvement mandates with a newer,
stricter, baseline year (2003) and a new timeline for
energy reduction requirements. The federal building
segment remains an excellent target for large-scale
improvement, as well as setting the all-important high
visibility example for private industry to follow.
The Presidential Executive Orders mentioned in
Chapter 20 created the Federal Energy Management
Program (FEMP) to aid the federal sector in meeting
federal energy management goals. The potential FEMP
savings are mammoth and new professionals affi liated
with federal, as well as state and local governments
have joined the energy manager ranks. However, as
Congress changes complexion, the FEMP and even DOE
itself may face uncertain futures. The roller coaster ride
continues.
FEMP efforts are showing results. Figure 1.3 out-

lines the goals that have been established for FEMP and
reports show that the savings are apparently on sched-
ule to meet all these goals. As with all such programs,
reporting and measuring is diffi cult and critical. How-
ever, that energy and money is being saved is undeni-
able. More important, however, to most of this book's
readers are the Technology Demonstration Programs
and Technology Alerts being published by the Pacifi c
Northwest Laboratories of Battelle in cooperation with
the US DOE. Both of these programs are dramatically
speeding the incorporation of new technology and the
Alerts are a great source of information for all energy
managers. (Information is available on the WEB).
As utility DSM programs shrink, while private
sector businesses and the federal government expand
their needs for energy management programs, the door
is opening for the ESCOs (Energy Service Companies),
Shared Savings Providers, Performance Contractors,
and other similar organizations. These groups are pro-
viding the auditing, energy and economic analyses,
capital and monitoring to help other organizations
reduce their energy consumption and reduce their
expenditures for energy services. By guaranteeing and
sharing the savings from improved energy effi ciency
and improved productivity, both groups benefi t and
prosper.
Throughout it all, energy managers have proven
time and time again, that energy management is cost
effective. Furthermore, energy management is vital to
our national security, environmental welfare, and eco-

nomic productivity. This will be discussed in the next
section.
1.2 THE VALUE OF ENERGY MANAGEMENT
Business, industry and government organiza-
tions have all been under tremendous economic and
environmental pressures in the last few years. Being
economically competitive in the global marketplace and
meeting increasing environmental standards to reduce
air and water pollution have been the major driving
factors in most of the recent operational cost and capital
cost investment decisions for all organizations. Energy
management has been an important tool to help organi-
zations meet these critical objectives for their short term
survival and long-term success.
The problems that organizations face from both
their individual and national perspectives include:
• Meeting more stringent environmental quality
standards, primarily related to reducing global
warming and reducing acid rain.
Energy management helps improve environmen-
tal quality. For example, the primary culprit in global
warming is carbon dioxide, CO
2
. Equation 1.1, a bal-
anced chemistry equation involving the combustion of
methane (natural gas is mostly methane), shows that
2.75 pounds of carbon dioxide is produced for every
pound of methane combusted. Thus, energy manage-
ment, by reducing the combustion of methane can
dramatically reduce the amount of carbon dioxide in

the atmosphere and help reduce global warming. Com-
mercial and industrial energy use accounts for about 45
percent of the carbon dioxide released from the burning
of fossil fuels, and about 70 percent of the sulfur dioxide
emissions from stationary sources.
CH
4
+ 2 O
2
= CO
2
+ 2 H
2
O
(12 + 4*1) +2(2*16) =
(12 + 2*16) + 2(2*1 +16) (1.1)
Thus, 16 pounds of methane produces 44 pounds
of carbon dioxide; or 2.75 pounds of carbon di-
oxide is produced for each pound of methane
burned.
Energy management reduces the load on power
plants as fewer kilowatt hours of electricity are needed.
If a plant burns coal or fuel oil, then a signifi cant amount
of acid rain is produced from the sulphur dioxide
emitted by the power plant. Acid rain problems then
are reduced through energy management, as are NO
x

problems.
Less energy consumption means less petroleum

fi eld development and subsequent on-site pollution.
INTRODUCTION 3
Less energy consumption means less thermal pollution
at power plants and less cooling water discharge. Re-
duced cooling requirements or more effi cient satisfaction
of those needs means less CFC usage and reduced ozone
depletion in the stratosphere. The list could go on almost
indefi nitely, but the bottom line is that energy manage-
ment helps improve environmental quality.
• Becoming—or continuing to be—economically
competitive in the global marketplace, which re-
quires reducing the cost of production or services,
reducing industrial energy intensiveness, and
meeting customer service needs for quality and
delivery times.
Signifi cant energy and dollar savings are available
through energy management. Most facilities (manufac-
turing plants, schools, hospitals, offi ce buildings, etc)
can save according to the profi le shown in Figure 1.1.
Even more savings have been accomplished by some
programs.
√ Low cost activities fi rst year or two: 5 to
15%
√ Moderate cost, signifi cant effort, three to fi ve
years: 15 to 30%
√ Long-term potential, higher cost, more engi-
neering: 30 to 50%
Figure 1.1 Typical Savings
Through Energy Management
Thus, large savings can be accomplished often with

high returns on investments and rapid paybacks. Energy
management can make the difference between profi t and
loss and can establish real competitive enhancements for
most companies.
Energy management in the form of implementing
new energy effi ciency technologies, new materials and
new manufacturing processes and the use of new tech-
nologies in equipment and materials for business and
industry is also helping companies improve their pro-
ductivity and increase their product or service quality.
Often, the energy savings is not the main driving factor
when companies decide to purchase new equipment,
use new processes, and use new high-tech materials.
However, the combination of increased productivity,
increased quality, reduced environmental emissions, and
reduced energy costs provides a powerful incentive for
companies and organizations to implement these new
technologies.
Total Quality Management (TQM) is another em-
phasis that many businesses and other organizations
have developed over the last decade. TQM is an inte-
grated approach to operating a facility, and energy cost
control should be included in the overall TQM program.
TQM is based on the principle that front-line employees
should have the authority to make changes and other
decisions at the lowest operating levels of a facility. If
employees have energy management training, they can
make informed decisions and recommendations about
energy operating costs.
• Maintaining energy supplies that are:

— Available without signifi cant
interruption, and
— Available at costs that do not
fl uctuate too rapidly.
Once again, the country is becoming dependent on
imported oil. During the time of the 1979 oil price crisis,
the U.S. was importing almost 50% of our total oil con-
sumption. By 1995, the U.S. was again importing 50% of
our consumption. Today (2003) we are importing even
more (approximately 54%), and the price has dramati-
cally increased. Thus, the U.S. is once again vulnerable
to an oil embargo or other disruption of supply. The
major difference is that there is a better balance of oil
supply among countries friendly to the U.S. Nonethe-
less, much of the oil used in this country is not produced
in this country. The trade balance would be much more
favorable if we imported less oil.
• Helping solve other national concerns which in-
clude:
— Need to create new jobs
— Need to improve the balance of payments by
reducing costs of imported energy
— Need to minimize the effects of a potential
limited energy supply interruption
None of these concerns can be satisfactorily met
without having an energy effi cient economy. Energy
management plays a key role in helping move toward
this energy effi cient economy.
1.3 THE ENERGY MANAGEMENT PROFESSION
Energy management skills are important to people

in many organizations, and certainly to people who
4 ENERGY MANAGEMENT HANDBOOK
perform duties such as energy auditing, facility or
building management, energy and economic analysis,
and maintenance. The number of companies employ-
ing professionally trained energy managers is large and
growing. A partial list of job titles is given in Figure 1.2.
Even though this is only a partial list, the breadth shows
the robustness of the profession.
For some of these people, energy management will
be their primary duty, and they will need to acquire
in-depth skills in energy analysis as well as knowledge
about existing and new energy using equipment and
technologies. For others—such as maintenance manag-
ers—energy management skills are simply one more
area to cover in an already full plate of duties and ex-
pectations. The authors are writing this Energy Manage-
ment Handbook for both of these groups of readers and
users.
Twenty years ago, few university faculty mem-
bers would have stated their primary interest was
energy management, yet today there are numerous fac-
ulty who prominently list energy management as their
principal specialty. In 2003, there were 26 universities
throughout the country listed by DOE as Industrial
Assessment Centers or Energy Analysis and Diagnostic
Centers. Other Universities offer coursework and/or
do research in energy management but do not have
one of the above centers. Finally, several professional
Journals and Magazines now publish exclusively for

energy managers while we know of none that existed
15 years ago.
The need for energy management in federal facili-
ties predates the U.S. Department of Energy. Since 1973,
the President and Congress have called on federal agen-
cies to lead by example in energy conservation and man-
agement in its own facilities, vehicles and operations.
Both the President and the Congress have addressed the
issue of improving energy effi ciency in federal facilities
several times since the mid- 1970’s. Each new piece of
legislation and executive order has combined past expe-
riences with new approaches in
12
an effort to promote
further effi ciency gains in federal agencies . The Federal
Energy Management Program (FEMP) was established
in the early 1970’s to coordinate federal agency report-
ing, analysis of energy use and to encourage energy
conservation and still leads that effort today. Executive
Order 13123, Greening the Government Through Effi cient
Energy Management, signed by President Clinton in June
1999, is the most recent directive for federal agencies.
A brief summary of the goals of that executive order is
given in Figure 1.3. In addition to the goals, Executive
Order 13123 outlined several other requirements for
federal agencies aimed at improving energy effi ciency,
reducing greenhouse gases and other emissions, increas-
ing the use of renewable energy, and promoting federal
leadership in energy management.
Like energy management itself, utility DSM pro-

grams have had their ups and downs. DSM efforts
peaked in the late 80s and early 90s, and have since
retrenched signifi cantly as utility deregulation and the
movement to retail wheeling have caused utilities to
reduce staff and cut costs as much as possible. This
short-term cost cutting is seen by many utilities as their
only way to become a competitive low-cost supplier
of electric power. Once their large customers have the
choice of their power supplier, they want to be able to
hold on to these customers by offering rates that are
competitive with other producers around the country. In
the meantime, the other energy services provided by the
utility are being reduced or eliminated in this corporate
downsizing effort.
This reduction in electric utility incentive and rebate
programs, as well as the reduction in customer support,
has produced a gap in energy service assistance that is be-
ing met by a growing sector of equipment supply compa-
nies and energy service consulting fi rms that are willing
and able to provide the technical and fi nancial assistance
that many organizations previously got from their local
electric utility. New business opportunities and many
new jobs are being created in this shift away from utility
support to energy service company support. Energy man-
agement skills are extremely important in this rapidly
expanding fi eld, and even critical to those companies that
are in the business of identifying energy savings and pro-
viding a guarantee of the savings results.
• Plant Energy Manager • Building/Facility Energy Manager
• Utility Energy Auditor • Utility Energy Analyst

• State Agency Energy Analyst • Federal Energy Analyst
• Consulting Energy Manager • Consulting Energy Engineer
• DSM Auditor/Manager
Figure 1.2 Typical Energy Management Job Titles
INTRODUCTION 5
Thus, the future for energy management is ex-
tremely promising. It is cost effective, it improves envi-
ronmental quality, it helps reduce the trade defi cit, and
it helps reduce dependence on foreign fuel supplies.
Energy management will continue to grow in size and
importance.
1.4 SOME SUGGESTED PRINCIPLES OF
ENERGY MANAGEMENT
(The material in this section is repeated verbatim
from the fi rst and second editions of this handbook.
Mr. Roger Sant who was then director of the Energy
Productivity Center of the Carnegie-Mellon Institute of
Research in Arlington, VA, wrote this section for the fi rst
edition. It was unchanged for the second edition. Now,
the fourth edition is being printed. The principles devel-
oped in this section are still sound. Some of the number
quoted may now be a little old; but the principles are
still sound. Amazing, but what was right 18 years ago
for energy management is still right today. The game has
changed, the playing fi eld has moved; but the principles
stay the same).
If energy productivity is an important opportunity
for the nation as a whole, it is a necessity for the indi-
vidual company. It represents a real chance for creative
management to reduce that component of product cost

that has risen the most since 1973.
Those who have taken advantage of these opportu-
nities have done so because of the clear intent and com-
mitment of the top executive. Once that commitment is
understood, managers at all levels of the organization
can and do respond seriously to the opportunities at
hand. Without that leadership, the best designed energy
management programs produce few results. In addition,
we would like to suggest four basic principles which,
if adopted, may expand the effectiveness of existing
energy management programs or provide the starting
point of new efforts.
The fi rst of these is to control the costs of the energy
function or service provided, but not the Btu of energy. As
most operating people have noticed, energy is just a
means of providing some service or benefi t. With the
possible exception of feedstocks for petrochemical pro-
duction, energy is not consumed directly. It is always
converted into some useful function. The existing data
are not as complete as one would like, but they do
indicate some surprises. In 1978, for instance, the ag-
gregate industrial expenditure for energy was $55 bil-
lion. Thirty-fi ve percent of that was spent for machine
drive from electric motors, 29% for feedstocks, 27% for
process heat, 7% for electrolytic functions, and 2% for
space conditioning and light. As shown in Table 1.1,
this is in blunt contrast to measuring these functions in
Btu. Machine drive, for example, instead of 35% of the
dollars, required only 12% of the Btu.
In most organizations it will pay to be even more

specifi c about the function provided. For instance, evap-
oration, distillation, drying, and reheat are all typical of
Sec. 201. Greenhouse Gases Reduction Goal.
Reduce greenhouse gas emissions attributed to
facility energy use by 30% by 2010 compared to
1990.
Sec. 202. Energy Effi ciency Improvement Goals.
Reduce energy consumption per gross square foot
of facilities by 30% by 2005 and by 35% by 2010
relative to 1985.
Sec. 203. Industrial and Laboratory Facilities. Re-
duce energy consumption per square foot, per unit
of production, or per other unit as applicable by
20% by 2005 and 25% by 2010 relative to 1990.
Sec. 204. Renewable Energy. Strive to expand use
of renewable energy. The federal government shall
strive to install 2,000 solar energy systems at fed-
eral facilities by the end of 2000, and 20,000 solar
energy systems at federal facilities by 2010.
Sec. 205. Petroleum. Each agency shall reduce the
use of petroleum within its facilities. [Although
no specifi c goal is identifi ed.]
Sec. 206. Source Energy. The federal government
shall strive to reduce total energy use as mea-
sured at the source. [Although agency reporting
requirements for energy consumption are based
on site energy, this section allows for an agency
to receive a credit for activities where source en-
ergy decreases but site energy increase, such as
in cogeneration systems.]

Sec. 207. Water Conservation. Reduce water
consumption and associated energy use in their
facilities to reach the goals (subsequently) set by
the Secretary of Energy. [The Secretary of Energy,
through the DOE Federal Energy Management
Program, issued guidance to establish water ef-
fi ciency improvement goal for federal agencies
in May 2000. See www.eere.energy.gov/femp/
resources/waterguide.html for details.
√
Figure 1.3. Federal Agency Goals as Established by Ex-
ecutive Order 13123.
√
√
√
√
√
√
6 ENERGY MANAGEMENT HANDBOOK
the uses to which process heat is put. In some cases it
has also been useful to break down the heat in terms of
temperature so that the opportunities for matching the
heat source to the work requirement can be utilized.
In addition to energy costs, it is useful to measure
the depreciation, maintenance, labor, and other operat-
ing costs involved in providing the conversion equip-
ment necessary to deliver required services. These costs
add as much as 50% to the fuel cost.
It is the total cost of these functions that must be
managed and controlled, not the Btu of energy. The large

difference in cost of the various Btu of energy can make
the commonly used Btu measure extremely misleading.
In November 1979, the cost of 1 Btu of electricity was
nine times that of 1 Btu of steam coal. Table 1.2 shows
how these values and ratios compare in 2005.
One of the most desirable and least reliable skills
for an energy manager is to predict the future cost of
energy. To the extent that energy costs escalate in price
beyond the rate of general infl ation, investment pay-
backs will be shortened, but of course the reverse is also
true. A quick glance at Table 1.2 shows the inconsistency
in overall energy price changes over this period in time.
Even the popular conception that energy prices always
go up was not true for this period, when normalized to
constant dollars. This volatility in energy pricing may
account for some business decisions that appear overly
conservative in establishing rate of return or payback
period hurdles.
Availabilities also differ and the cost of maintain-
ing fuel fl exibility can affect the cost of the product.
And as shown before, the average annual price increase
of natural gas has been almost three times that of elec-
tricity. Therefore, an energy management system that
controls Btu per unit of product may completely miss
the effect of the changing economics and availabilities
of energy alternatives and the major differences in us-
ability of each fuel. Controlling the total cost of energy
functions is much more closely attuned to one of the
principal interests of the executives of an organiza-
tion—controlling costs.

NOTE: The recommendation to control energy dol-
lars and not Btus does not always apply. For example,
tracking building energy use per year for comparison to
prior years is best done with Btus since doing so negates
the effect of energy price volatility. Similarly, comparing
the heating use of a commercial facility against an indus-
try segment benchmark using cost alone can yield wild
results if, for example, one building uses natural gas to
heat while another uses electric resistance; this is another
case where using Btus yields more meaningful results.
Table 1.1 Industrial Energy Functions by Expenditure
and Btu, 1978
—————————————————————————
Dollar
Expenditure Percent of Percent of
Function (billions) Expenditure Total Btu
—————————————————————————
Machine drive 19 35 12
Feedstocks 16 29 35
Process steam 7 13 23
Direct heat 4 7 13
Indirect heat 4 7 13
Electrolysis 4 7 3
Space conditioning
and lighting 1 1 1
––– ––– –––
Total 55 100 100
—————————————————————————
Source: Technical Appendix, The Least-Cost Energy Strategy, Carnegie-Mel-
lon University Press, Pittsburgh, Pa., 1979, Tables 1.2.1 and 11.3.2.

Table 1.2 Cost of Industrial Energy per Million Btu, 1979 and 2005
INTRODUCTION 7
A second principle of energy management is to
control energy functions as a product cost, not as a part of
manufacturing or general overhead. It is surprising how
many companies still lump all energy costs into one
general or manufacturing overhead account without iden-
tifying those products with the highest energy function
cost. In most cases, energy functions must become part
of the standard cost system so that each function can be
assessed as to its specifi c impact on the product cost.
The minimum theoretical energy expenditure to
produce a given product can usually be determined
en route to establishing a standard energy cost for that
product. The seconds of 25-hp motor drive, the minutes
necessary in a 2200°F furnace to heat a steel part for fab-
rication, or the minutes of 5-V electricity needed to make
an electrolytic separation, for example, can be determined
as theoretical minimums and compared with the actual
fi gures. As in all production cost functions, the minimum
standard is often diffi cult to meet, but it can serve as an
indicator of the size of the opportunity.
In comparing actual values with minimum values,
four possible approaches can be taken to reduce the
variance, usually in this order:
1. An hourly or daily control system can be installed
to keep the function cost at the desired level.
2. Fuel requirements can be switched to a cheaper
and more available form.
3. A change can be made to the process methodology

to reduce the need for the function.
4. New equipment can be installed to reduce the cost
of the function.
The starting point for reducing costs should be
in achieving the minimum cost possible with the pres-
ent equipment and processes. Installing management
control systems can indicate what the lowest possible
energy use is in a well-controlled situation. It is only at
that point when a change in process or equipment con-
fi guration should be considered. An equipment change
prior to actually minimizing the expenditure under the
present system may lead to oversizing new equipment
or replacing equipment for unnecessary functions.
The third principle is to control and meter only the
main energy functions—the roughly 20% that make up
80% of the costs. As Peter Drucker pointed out some
time ago, a few functions usually account for a majority
of the costs. It is important to focus controls on those
that represent the meaningful costs and aggregate the
remaining items in a general category. Many manufac-
turing plants in the United States have only one meter,
that leading from the gas main or electric main into the
plant from the outside source. Regardless of the reason-
ableness of the standard cost established, the inability to
measure actual consumption against that standard will
render such a system useless. Submetering the main
functions can provide the information not only to mea-
sure but to control costs in a short time interval. The cost
of metering and submetering is usually incidental to the
potential for realizing signifi cant cost improvements in

the main energy functions of a production system.
The fourth principle is to put the major effort of
an e nergy management program into installing controls and
achieving results. It is common to fi nd general knowledge
about how large amounts of energy could be saved in a
plant. The missing ingredient is the discipline necessary
to achieve these potential savings. Each step in saving
energy needs to be monitored frequently enough by the
manager or fi rst-line supervisor to see noticeable changes.
Logging of important fuel usage or behavioral observa-
tions are almost always necessary before any particular
savings results can be realized. Therefore, it is critical that
an energy director or committee have the authority from
the chief executive to install controls, not just advise line
management. Those energy managers who have achieved
the largest cost reductions actually install systems and
controls; they do not just provide good advice.
As suggested earlier, the overall potential for in-
creasing energy productivity and reducing the cost of en-
ergy services is substantial. The 20% or so improvement
in industrial energy productivity since 1972 is just the
beginning. To quote the energy director of a large chemi-
cal company: “Long-term results will be much greater.”
Although no one knows exactly how much we can
improve productivity in practice, the American Physical
Society indicated in their 1974 energy conservation study
that it is theoretically possible to achieve an eightfold
improvement of the 1972 energy/production ratio.
9
Most

certainly, we are a long way from an economic satura-
tion of the opportunities (see, e.g., Ref. 10). The common
argument that not much can be done after a 15 or 20%
improvement has been realized ought to be dismissed
as baseless. Energy productivity provides an expanding
opportunity, not a last resort. The chapters in this book
provide the information that is necessary to make the
most of that opportunity in each organization.
References
1. Statistical Abstract of the United States, U.S. Government Printing
Offi ce, Washington, D.C., 1999.
2. Energy User News, Jan. 14, 1980.
3. JOHN G. WINGER et al., Outlook for Energy in the United States
8 ENERGY MANAGEMENT HANDBOOK
to 1985, The Chase Manhattan Bank, New York, 1972, p 52.
4. DONELLA H. MEADOWS et al., The Limits to Growth, Universe
Books, New York, 1972, pp. 153-154.
5. JIMMY E. CARTER, July 15, 1979, “Address to the Nation,” Wash-
ington Post, July 16, 1979, p. A14.
6. Monthly Energy Review, Jan. 1980, U.S. Department of Energy,
Washington, D.C., p. 16.
7. Monthly Energy Review, Jan. 1980, U.S. Department of Energy,
Washington D.C., p. 8; Statistical Abstract of the United States, U.S.
Government Printing Offi ce, Washington, D.C., 1979, Table 1409;
Energy User News, Jan. 20, 1980, p. 14.
8. American Association for the Advancement of Science, “U.S. En-
ergy Demand: Some Low Energy Futures,” Science, Apr. 14, 1978,
p. 143.
9. American Physical Society Summer Study on Technical Aspects of
Effi cient Energy Utilization, 1974. Available as W.H. CARNAHAN

et al., Effi cient Use of Energy, a Physics Perspective, from NTIS PB-
242-773, or in Effi cient Energy Use, Vol. 25 of the American Institute
of Physics Conference Proceedings.
10. R.W. SANT, The Least-Cost Energy Strategy, Carnegie-Mellon Uni-
versity Press, Pittsburgh, Pa., 1979
11. U.S. Congress Offi ce of Technology Assessment (OTA). Energy Ef-
fi ciency in the Federal Government: Government by Good Example?
OTA-E-492, U.S. Government Printing Offi ce, Washington D.C., May
1991.
12. U.S. Air Force. DOD Energy Manager’s Handbook Volume 1: Installa-
tion Energy Management. Washington D.C., April 1993.
WILLIAM H. MASHBURN, P.E., CEM
Professor Emeritus
Mechanical Engineering Department
Virginia Polytechnic Institute & State University
Blacksburg, Virginia
2.1 INTRODUCTION
Some years ago, a newspaper headline stated,
“Lower energy use leaves experts pleased but puzzled.”
The article went on to state “Although the data are
preliminary, experts are baffl ed that the country appears
to have broken the decades-old link between economic
growth and energy consumption.”
For those involved in energy management, this
comes as no surprise. We have seen companies becom-
ing more effi cient in their use of energy, and that’s show-
ing in the data. Those that have extracted all possible
savings from downsizing, are now looking for other
ways to become more competitive. Better management
of energy is a viable way, so there is an upward trend in

the number of companies that are establishing an energy
management program. Management is now beginning
to realize they are leaving a lot of money on the table
when they do not instigate a good energy management
plan.
With the new technologies and alternative energy
sources now available, this country could possibly re-
duce its energy consumption by 50%—if there were
no barriers to the implementation. But of course, there
are barriers, mostly economic. Therefore, we might
conclude that managing energy is not a just technical
challenge, but one of how to best implement those
technical changes within economic limits, and with a
minimum of disruption.
Unlike other management fads that have come
and gone, such as value analysis and quality circles, the
need to manage energy will be permanent within our
society.
There are several reasons for this:
• There is a direct economic return. Most opportuni-
ties found in an energy survey have less than a two
year payback. Some are immediate, such as load
shifting or going to a new electric rate schedule.
• Most manufacturing companies are looking for a
competitive edge. A reduction in energy costs to
manufacture the product can be immediate and
permanent. In addition, products that use en-
ergy, such as motor driven machinery, are being
evaluated to make them more energy effi cient, and
therefore more marketable. Many foreign countries

where energy is more critical, now want to know
the maximum power required to operate a piece
of equipment.
• Energy technology is changing so rapidly that
state-of-the-art techniques have a half life of ten
years at the most. Someone in the organization
must be in a position to constantly evaluate and
update this technology.
• Energy security is a part of energy management.
Without a contingency plan for temporary short-
ages or outages, and a strategic plan for long range
plans, organizations run a risk of major problems
without immediate solutions.
• Future price shocks will occur. When world energy
markets swing wildly with only a fi ve percent de-
crease in supply, as they did in 1979, it is reason-
able to expect that such occurrences will happen
again.
Those people then who choose—or in many cases
are drafted—to manage energy will do well to recognize
this continuing need, and exert the extra effort to be-
come skilled in this emerging and dynamic profession.
The purpose of this chapter is to provide the funda-
mentals of an energy management program that can be,
and have been, adapted to organizations large and small.
Developing a working organizational structure may be
the most important thing an energy manager can do.
2.2 ENERGY MANAGEMENT PROGRAM
All the components of a comprehensive energy
management program are depicted in Figure 2-1. These

components are the organizational structure, a policy, and
plans for audits, education, reporting, and strategy. It is
hoped that by understanding the fundamentals of manag-
ing energy, the energy manager can then adapt a good
9
CHAPTER 2
EFFECTIVE ENERGY MANAGEMENT
10 ENERGY MANAGEMENT HANDBOOK
Figure 2.1
working program to the existing organizational structure.
Each component is discussed in detail below.
2.3 ORGANIZATIONAL STRUCTURE
The organizational chart for energy management
shown in Figure 2-1 is generic. It must be adapted to
fi t into an existing structure for each organization. For
example, the presidential block may be the general man-
ager, and VP blocks may be division managers, but the
fundamental principles are the same. The main feature
of the chart is the location of the energy manager. This
position should be high enough in the organizational
structure to have access to key players in management,
and to have a knowledge of current events within the
company. For example, the timing for presenting energy
projects can be critical. Funding availability and other
management priorities should be known and under-
stood. The organizational level of the energy manager
is also indicative of the support management is willing
to give to the position.
2.3.1 Energy Manager
One very important part of an energy management

program is to have top management support. More im-
portant, however, is the selection of the energy manager,
who can among other things secure this support. The
person selected for this position should be one with a
vision of what managing energy can do for the com-
pany. Every successful program has had this one thing
in common—one person who is a shaker and mover that
makes things happen. The program is then built around
this person.
There is a great tendency for the energy manager
to become an energy engineer, or a prima donna, and at-
tempt to conduct the whole effort alone. Much has been
accomplished in the past with such individuals working
alone, but for the long haul, managing the program by
involving everyone at the facility is much more produc-
tive and permanent. Developing a working organiza-
tional structure may be the most important thing an
energy manager can do.
The role and qualifi cations of the energy manager
have changed substantially in the past few years, caused
mostly by EPACT-1992 requiring certifi cation of federal
energy managers, deregulation of the electric utility in-
dustry bringing both opportunity and uncertainty, and
by performance contracting requiring more business
skills than engineering. In her book titled “Performance
Contracting: Expanded Horizons,” Shirley Hansen give
the following requirements for an energy management:
• Set up an Energy Management Plan
• Establish energy records
• Identify outside assistance

• Assess future energy needs
• Identify fi nancing sources
• Make energy recommendations
• Implement recommendations
President
VP
Educational
Plan
Reporting
System
Strategic
Plan
Employees
Coordinator
Policy
Audit Plan
Energy Manager
VP
VP
Coordinator
Coordinator
ENERGY MANAGEMENT PROGRAM