First off, congrats to the energy team Ed, Lisa, Songyang, Allan, and the recently departed Chad on saving almost $14M cumulatively since the start of the energy manager program at UHN! And now, some background information on how I came up with this number. It started with a question:

“If we are doing so much energy management, why are the bills still higher!?”

This question is a common one faced by many energy managers. There are numerous reasons why utility bills could continue to rise despite energy efficiency improvements, including rate escalation, weather variability, building expansions, space use changes, equipment degradation, and more.

The key answer to this question is actually another question – “How much would we be spending without energy management?” The new VP of our department, Ron Swail, challenged me to answer this question when he first came on board at UHN.

In order to do this, I built a weather regression model for each UHN site based on past weather and utility consumption data from before the first energy manager was hired at UHN. Weather regression correlates past weather with past energy consumption in a “baseline” formula to predict future energy consumption under different weather conditions (for example, during a hotter summer more electricity will be consumed for air conditioning). Thankfully, our fearless leader Ed Rubinstein has been keeping detailed utility and weather records for many years while he was developing the energy management program at UHN.

We also have records of past building expansions and renovations and estimations of their energy impacts. Where significant impacts occurred (ie large increase to building floor area), an adjustment is added to the baseline based on estimated/measured increase in energy consumption.

Now that we have a formula to calculate our expected energy consumption, we can apply the current utility rates to figure out what the cost would be. I conducted this analysis for each site and added them all up to come up with the following chart for all of UHN:

Cost Savings

Although actual costs (blue line) continued to rise until 2017, we can see that our “business as usual” cost (red line) was still significantly higher. The green area in between represents the costs savings with the green bar graph helping to visualize the same numbers. Did I mention that since UHN hired its first energy manager, we have saved almost 14 million dollars!!!!

To give you an idea of the cost escalation of utilities, I produced the same graph based only on actual energy consumption:

GJ Savings

To produce this graph I converted all of our energy consumption (kWh, m3 gas, ton-hours cooling, lbs steam) to a common unit of energy – the gigajoule (GJ). In 2013 and 2014, our expected energy consumption increased significantly due to addition of buildings (KDT) and weather effects. However, our actual consumption goes up much less than the baseline, meaning our energy efficiency projects are working and making our buildings more efficient. In 2016 and 2017 our expected consumption decreases, likely due to the cool summers requiring less electricity for air conditioning (I’m guessing this trend will reverse for 2018!). Note that in 2015 and 2016, our actual energy consumption went down while our costs went up!

This type of analysis is extremely useful for explaining the value of energy management to higher level and non-technical leaders in your organization. With a more accurate representation of just how much energy managers are contributing to cost savings, leaders can make more informed decisions on project priorities and budget allocations.

How did we achieve these savings? That’s a question for another blog here, here, here, here, here, here, here, and here.