How to Convince Your CEO Energy Efficiency Pays

Jin Park

Most energy efficiency programs can pay for themselves in just one year. It’s not uncommon for large multi-national companies to sustain a five percent energy reduction year-over-year to realize 30 percent or more in reduction over time. That’s just the beginning of the potential energy efficiency savings many companies are missing out on simply because they don’t have a shared corporate vision, a clear financial plan or a way to track and verify results.

Launching a successful efficiency program starts with building an effective business case that not only sells the plan internally, but also helps to ensure momentum throughout implementation.

4 Steps to building a business case for efficiency

Drawing from real-life experience, our clients and energy experts have identified these key steps to creating an effective business case for energy efficiency. For the complete guide, as well as advice from corporate energy managers, download the eBook.

Establish early buy-in starting at the executive level
Aligning corporate goals with energy efficiency goals is a fundamental first step, as is aligning corporate goals with individual facility goals. This means that all stakeholders — from the factory floor to the C-Suite — must be involved in identifying and prioritizing energy efficiency goals and performance expectations.

“Being able to show investment plans and their payback had a larger impact on leadership decision making than overwhelming them with lots of data about kilowatt hours and carbon output.” – Walter Kraus, Vice President, Environment & Corporate Sustainability, Weston Foods
Map current performance baselines
Establishing performance baselines is also a critical step. Companies operating multiple sites will benefit from having an enterprise-view into energy data so they can compare like sites. It’s also important to establish a process for normalizing energy usage with input from key stakeholders involved in operations and facilities. This will help ensure that the results are accurate and meaningful. Skipping this step may lead to poor project performance and may even hurt your credibility during future project approvals.

“Having all our data in one platform, side-by-side, allowed us to see right away where we had performance issues and where the low-hanging fruit was.” – Chris Davis, La-Z-Boy’s Director of Automation & Facilities
Develop an opportunity profile
Once you have a comprehensive view into your energy consumption data and established benchmarks, you can assess and prioritize savings opportunities for planning and budgeting. These opportunities can be categorized as operational and capital-intensive improvements. To establish credibility with stakeholders early on, start with operational efficiency measures that involve little to no capital, with proven payback. Forward looking companies are starting to take an integrated approach, pursuing operational and capital opportunities in parallel and using savings to pay for or expand their efficiency initiatives.
Confirm support of implementation owners
It’s one thing to create a plan, but it’s quite another to implement it across a company with locations around the country or even the globe. Be sure to develop an energy advisory team staffed with key stakeholders and influencers. These folks can make or break an entire energy efficiency program. Once you have their input and buy-in, remember to stay in touch to ensure consistent implementation and to trouble-shoot issues early.

Following these steps is a proven way to successfully build a case for energy efficiency, but they’re just the beginning. To be truly successful, companies need to develop a continuous improvement culture where efficiency becomes as second nature as labor, materials and production planning. It must be woven into the fabric of the operation, and integrated as one strategy and one set of goals for the company.

Learn more about how to build your business case for efficiency

Download the eBook where you will learn how to: