Non-Energy Benefits: Reducing Payback and Improving Performance

With growing energy supply concerns and rising costs, energy efficiency is a critical component of industrial energy resilience and competitiveness by directly reducing energy operating costs. However, it is difficult to receive approval for energy efficiency projects, so implementation rates are low, even when meeting capital project payback period criteria. It is in addressing this barrier that non-energy benefits (NEBs) become critical. NEBs are the additional impacts that can come from energy efficiency projects that lie outside of the energy savings scope. Research has shown that such projects in manufacturing plants have also yielded valuable benefits outside of simple energy cost reductions, such as reduced maintenance costs, safety improvements, decreased pollution, and enhanced productivity. There are many NEBs that can be considered for a given project, but the most important factor is in determining impacts that are valued and defensible in a particular manufacturing environment. This can be easier said than done and while some NEBs are readily quantified, such as maintenance cost savings or utility rebates, others are more difficult to quantify, such as employee satisfaction. Additionally, the NEBs concept may also be applied in energy-related projects that go beyond simple efficiency measures, for example, electrification and fuel- switching to lower-carbon fuels, which companies might pursue in order to achieve other strategic objectives. The inclusion and quantification of NEBs in the decision-making process for energy projects can improve the overall financial payback period while also demonstrating a positive impact on the firm's key performance metrics and business strategy.