A Guide to Energy Management Systems for Businesses

As businesses are hit by rising energy costs, many businesses may be wondering whether it’s time to invest in an energy management system. But what exactly does an energy management system do, who can it help and what do you need to consider? We explain all in this week’s article.

A sound business is one that is run efficiently and with little waste. If there is waste, it’s going to cost you money, including the energy you use to run a company. Energy management can get overlooked when businesses calculate their operating costs because many companies wrongly assume it’s a cost over which they have little control. Yet comprehensive energy management is easily available through technology that’s both affordable and easy to install. 

In this guide, we will look at: 

1. What is an energy management system for businesses?
2. How does an energy management system work? 
3. What kinds of businesses might be able to use this technology? 
4. What are some of the benefits?  

1. What is an energy management system for businesses?

There are different solutions available for businesses looking to better manage their energy and make savings on their bills. You could, for example, hire an energy consultant to put a strategy in place. This will likely cost you more money up front and for many smaller businesses, it’s simply not economically feasible. 

A very common energy management solution is to use cloud-based software to monitor your usage, sending almost real-time data to a dashboard. This is what we use at GridDuck HQ. Our energy monitoring system will check which buildings, machines or appliances are using the most energy and the likely reason why. What’s more, a good EMS will point out anomalies that can usually be fixed by small interventions. 

You could also automate certain functions, such as lighting, heating and cooling, and integrate any renewables you might have on site. For instance, you could set the heating to come on when a room reaches a certain temperature and then switch it off automatically. One of our clients saved 35% on energy by automating drinks fridges to turn off out of hours. 

The aim is to optimise your energy use, to cut back on waste, to save money and reduce carbon emissions. You could use an energy management system to monitor one building or an entire business estate. After all, you cannot manage what you can’t measure.

GridDuck has recently introduced submetering to offer businesses the ability to monitor their electricity, gas and water in one place. We are working with two large chains, one in hospitality and one in property, to give them data that will reduce their overall consumption. As their business estate is large, the potential savings is huge. 

With rising energy costs and environmental targets, can you afford not to have an energy management system for your business? Almost a third of businesses believe energy costs are a barrier to growth and success.  

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2. How Does an Energy Management System for Businesses Work? 

An energy management system works by analysing and processing large amounts of data. With IoT technology, you can do this in real time. The data is sent to a dashboard that includes graphics and customisable tools. It enables business owners to monitor, automate and control their energy use with achievable actions. An EMS can reduce operating costs and increase your productivity and efficiency over time. 

By contrast, a building management system, or BMS, is different and is used to automate certain functions within a building. The computer-based system will control the likes of ventilation, lighting, cooling and security systems, and ensure that these systems work in conjunction with each other and in isolation. A BMS will provide limited analytics for optimisation and its installation is often cost prohibitive for smaller businesses. 

To put it succinctly, a BMS ensures that a building is operating effectively; an EMS ensures that a building is operating efficiently. 

Our energy management system includes hardware – wireless clamps, smart plugs, relays, sensors – that is affordable, easy to install and use. GridDuck’s hardware connects to a network via Zigbee, a wireless protocol similar to Wifi that is securely encrypted. Once this is set up, our online dashboard is intuitive and comprehensive, providing many insights into how your business is consuming energy, or identifying potential maintenance issues.

3. What Businesses Can Use an EMS?

Any type of business can use an EMS, but with gas and electricity prices continuing to soar to record-high levels, the case for implementing one is becoming more obvious. Recent research shows that businesses have seen an average gas bill increase of more than 250% in the last year. Meanwhile, roughly 90% of businesses are small or medium-sized enterprises (SMEs), which are most likely to benefit from an energy management system. 

On top of this, environmental targets are pushing companies to become more energy efficient and reduce their carbon emissions. A bonus of being an organisation with good environmental policies is that your employees are more likely to feel good working for you. 

GridDuck works with organisations spanning many sectors, including retail, hospitality, agriculture, manufacturing and education. We have saved our clients money without huge upfront investment and helped them make sense of their energy bills in complicated tenancy arrangements.

For example, we worked with the National Highways Agency, a public-sector organisation that manages and maintains the UK’s road network. It operates over 100 depots and has several main offices. Some of these buildings are occupied by more than one business. As a result, the organisation needs to know its precise energy use across its tenancies. Our energy monitoring system enabled them to produce accurate energy reports that saved them time and reduced the need for onerous spreadsheets.  

We have done something similar for dark kitchens, providing these businesses with submetering data that makes it easier to calculate their energy bills when the spaces are shared by more than one tenant.

4. What are some of the benefits? 

The vast majority of businesses are wasting energy on several things, namely air conditioning, heating, cooling and inefficient appliances. According to estimates, businesses spend up to £6bn on wasted energy in the UK alone. That’s enough to power 65,000 homes. 

So, the first big benefit is that you will save money. Most energy management systems don’t have large upfront costs as there’s minimal hardware. The cost of our service will depend on several factors, but often amounts to an upfront cost of £3,000 and a monthly subscription fee of £30. Most clients enjoy a payback period of under 1 year, for example, London Cocktail Club, Priors Grove and Bowles and Walker. 

It will save you time. Many businesses will spend hours looking through their bills and trying to make sense of their costs. It’ll be even more time consuming if you’re trying to work out how to make gas and electricity savings without data. With an EMS, most of the hard work will be done for you. The software makes sense of your energy consumption and demand, presenting information and patterns in visual formats. 

You’ll become more productive. The point of having an energy management system is that your business operations will work more efficiently and this will have the effect of making you more productive and reducing your overhead costs. 

If you are in manufacturing, for example, you’ll be able to identify which machines aren’t working at an optimum level and address these problems before they need more costly intervention. One of our manufacturing clients was able to avoid costs of £20,000 by monitoring the efficiency of their shop floor machines.

You’ll be a more environmentally friendly business. We need to make a collective effort to reduce our overall carbon emissions. Businesses are being asked to reach certain targets in a drive to reach net zero (where emissions output is balanced by removal). Most companies are being asked to reduce emissions by 90-95%. Don’t wait until the last minute to make changes. By getting ahead of the game now, you’ll be in a much better place tomorrow. 

In conclusion, businesses that practice good energy management will ultimately be able to develop a long-term energy savings plan that is sustainable and better for the environment. You will have more control of peak demand and make timely interventions. Moreover, it’s worth the upfront costs as it doesn’t generally take long to recoup your investment. 

Contact GridDuck to find out how we could help you manage your energy consumption. We’d be happy to talk through your business needs.