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Making the case for change

Making The Case For Change

digitalenergy's Richard Hipkiss speaks to EiBI magazine about ESTA's role in championing the benefits of energy efficiency.

We all think the case for energy efficiency is obvious” says Richard Hipkiss. “but if it really was that obvious to the wider world, then the market would look very different today!” Hipkiss is the new chairman of ESTA, the Energy Services and Technology Association. With a background in electrical engineering, today he heads up digitalenergy, an organisation developing software for online energy management. A key concern of his is getting the message across about the benefit of energy efficiency. And, understandably, he sees a pivotal role for ESTA in achieving this.“ESTA as an organisation represents a ‘knowledge base’ of more than 30 years experience across every aspect of managing energy” he notes. “There is no other organisation with that depth of specialist expertise”. Not that it is purely historical know how, though. “At it’s heart, the energy management industry is about innovation, driven mainly by small firms who then become larger players or, in a number of cases, part of a much larger player.Technology tends to be driven by individuals who have been able to spot a novel idea and run with it.That continues today which is why the market and the available
technical solutions are continually expanding”

More diverse than supply

Yet this poses a challenge. “ESTA has over 100 members who represent different aspects of the energy management spectrum. The industry itself is more diverse than the traditional energy supply system” he notes . “The lobbying by the major energy suppliers is relatively simple-that the UK should build itself out of supply constraints.The imbalance actually disadvantages the economy as a whole though, believes Hipkiss. “If everyone reduced their energy consumption by 10 per cent through greater energy efficiency-which is quite feasible-the UK balance of payments would be transformed. And we would not be having the same debates about the lights going out one winter soon. We’d still need to invest in new supply capacity but it wouldn’t be as urgent nor as expensive.” "Given the amount of money and resources going into that ‘build’, build, build’ message, the energy management sector will have to find more subtle and more inclusive ways of promoting its own strategy.” says Hipkiss. And here he sees the value of alliances. “The market is growing and different groups are coalescing around a variety of specific goals and interests.” he notes. “As a broad-based industry association ESTA is working with a diversity of others in order to strengthen and amplify core messages while at the same time increasing the number of channels through which these are communicated.  “ESTA is a member of the Energy Management Alliance, lobbying for more resources and a higher priority for demand-side policies, and it is working with organisations like the Energy Institute to promote higher standards and consistency across the industry”, Hipkiss adds. But ESTA does have its own specific role to play too. “At its core, the Association’s members seek to help organisations across the public and private sectors to save money and reduce emissions by cutting energy consumption and managing energy more effectively. That covers a whole range of issues and solutions, from compliance through a diverse spread of technologies to training and service delivery-but all under the umbrella of improved energy performance”

Changing landscape

One  of the biggest challenges, especially for the energy users, is the way the ‘landscape’ changes. “In some ways, this changing landscape offers opportunities” he says. “We’ve seen how technologies have changed over the years, often quite rapidly. That has meant that further savings are always available. But change can also mean uncertainty and this can be distinctly unhelpful. All organisations need to be able to plan ahead and that will depend on being able to forecast the return on investment.” A political decision can ruin a business case overnight and he highlights the case of the CRC Energy Efficiency Scheme. “Many participants invested in automatic meter reading (AMR) as a way of increasing their share of the recycled outlay on carbon allowances.” he recalls. “These people suddenly found the carpet pulled from under their feet when the Government reduced the scheme to a pure energy tax.”The capricious nature of these changes makes investment committees wary of investing in energy efficient programmes as the rules may change almost without warning. Here Richard Hipkiss feels that the industry has to stress that energy efficiency is not just about taking advantage of transitory financial incentives. “The essential message I want to put across is that energy efficiency simply makes good business sense. After salaries and facilities, energy is usually the largest cost to the organisation-and crucially it is one that you can do something about.”

October 2012