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What is energy efficiency?

The definition of energy efficiency is simply to use less energy to perform the same task or produce the same result. The goal is to eliminate wasted energy. When a home or business is energy efficient, it uses less energy to heat, cool, and run appliances and electronics. An energy-efficient factory uses less energy to produce goods. When it comes to fighting climate change, energy efficiency is one of the easiest and most cost-effective ways to achieve Net Zero emissions of carbon dioxide through decarbonization. And since it aims to eliminate wasted energy, energy efficiency reduces costs.
The energy efficiency definition can involve calculating the ratio of output of performance (say, heating a building), a service (such as public transport), or goods (textiles, for example) in relation to the input of energy. For an economy-wide definition of energy efficiency, GDP is often compared to energy use, to measure what economists and governments call “energy intensity” (measured for example in kilowatt-hours per euro).

How to improve energy efficiency for companies?

Between rising energy costs and the spread of global warming targets, energy efficiency is more important for companies than ever. Fortunately, there are many ways to improve energy efficiency, thereby reducing costs. Achieving energy efficiency requires an initial investment of effort and money, but the long-term cost savings will repay the outlay over the years. Here’s a look at how to improve energy efficiency.

  • Energy audit: the first step to improve energy efficiency is an energy audit. Like a financial audit, an energy audit looks at energy consumption levels and how this can be optimized. The audit starts with a diagnosis, or an analysis phase, to obtain an overall assessment of things like peak loads, leaks, energy-sucking equipment, and inefficient lighting. On the basis of the audit, heating and electricity systems can be tweaked for efficiency and then monitored going forward.
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  • Upgrade to more efficient equipment: many countries now apply “energy class” labels to appliances and equipment, making it easy to upgrade older less efficient refrigerators, heaters, coolers and other energy-intensive equipment. Using laptop computers and LED lights are other examples of ways equipment can increase energy efficiency.
  • Shift to smart: smart thermostats and lighting that self-regulate according to building occupancy eliminate waste. Smart devices also make it easy to monitor consumption in real time, helping a business better understand how, where and when it consumes the most. 
  • Employee engagement: any effective energy efficiency plan works better with buy-in from staff. Getting them engaged in every day actions like setting thermostats lower in winter and higher in summer is key.
  • Install renewable energy generation: renewable energy sources like solar panels can be combined with Energy Management System (EMS) software that make them more efficient. Once the installation costs are recouped, renewable energy results in savings, and contributes to achieving climate change goals.
  • Make buildings more efficient through insulation: Temperature control is one of the largest energy expenditures, so energy efficiency starts with reducing heat or cooling losses. Weather-proofing an office or factory is fundamental to achieving energy efficiency.

How to monitor energy consumption?

Consumption monitoring is the first step to energy efficiency. An Energy Management System (EMS) is a digital platform that allows medium - to large-companies to gather, analyze and compare data on consumption of electricity, gas, and water use across all their systems, in real time. The software notifies the user when consumption levels move above or below a defined threshold, and can automatically suggest steps to take to optimize consumption and spending. For this reason, an EMS is an “energy efficiency platform” that helps a company or business achieve its energy efficiency goals. An intelligent Energy Monitoring System can also flag any faults in real time, and indicate what energy-saving measures will solve the problem.
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Moreover, it can provide Key Performance Indicators (KPIs), such as patterns relating to specific areas of energy consumption, intensity of energy usage and other indicators that can be of use in setting energy targets. An EMS can be supported by other analytical tools that are useful to monitor energy consumption and improve efficiency. Specialized energy advisors or consultants can assist companies in developing and implementing an energy efficiency strategy. Other analytical tools are designed specifically to help companies fight climate change, but are useful for energy monitoring as well. A sustainability report informs stakeholders inside and outside the company about concrete steps it is taking to reduce emissions, which usually includes energy efficiency. Setting science-based targets to reach Net Zero nearly always include steps to cut energy waste and improve efficiency. Lastly, non profit organizations like the Carbon Disclosure Project dedicated to helping companies achieve their climate goals and energy efficiency can help with roadmaps and technical expertise.

What is the benefit of an energy management system?

Because it monitors energy use in real time, an Energy Management System (EMS) provides a benefit in improving energy efficiency. Most companies, in actual fact, spend thousands of euros on their energy bills without being aware of which factors are contributing to excessive consumption or which production areas they can focus on to reduce waste and polluting emissions. An EMS software makes optimization and efficiency “suggestions” to deliver efficient, intelligent and more sustainable consumption.


An EMS provides several beneficial services. Here are a few:

  • Remotely monitors consumption round the clock, so that a user can intervene immediately to stay on track to reach targets
  • Comparisons between energy spends at the business’s various sites help trouble-shoot waste to improve performance.
  • Consumption and cost forecasts make it easier to plan for fluctuations, thereby avoiding peak times.
  • Benchmarking analyses that help a company adopt best practices compared to competitors.
All of these services translate into energy and financial savings benefits. This in turn makes it easier for companies to get closer to achieving the sustainability goals that are now deemed vital for any successful, forward-looking business. 

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