Here's where Singapore firms fail in energy management: study

Energy management isn't all about technology.

Energy intensive companies in Singapore are performing well in core aspects of energy management, but need to improve people-centric aspects, such as organisational structure, performance management and incentives, to fully realise and sustain the benefits of energy management, according to a study by Accenture.

Accenture, with support from the National Environment Agency (NEA), undertook a qualitative survey of 100 energy intensive companies in Singapore as part of the study, with the aim of helping these companies assess their current level of maturity of energy management capability. The findings are published in a report, Driving Energy Transformation, as companies in the industry sector respond to mandatory energy management requirements under the Energy Conservation Act (ECA), which came into force on April 22, 2013. The Act requires companies to take steps toward managing their energy consumption and boosting energy efficiency.

The report shows that, in comparison to their technological capabilities, most organisations are relatively less mature in the ‘softer’ people-centric aspects of energy management. These include organisational structures, roles and responsibilities, rewards and incentives, skills and training.

“It is easy to assume that efficient energy management is an issue of technology alone,” said Ynse de Boer, managing director of Accenture Sustainability Services for ASEAN. “To achieve sustained success, however, it is critical that companies empower people as agents to drive transformational change within a more holistic and structured approach to energy management.”

The report also reveals that levels of energy management maturity vary between different industry sectors and within some industries, highlighting the diverse nature of opportunities across Singapore’s industrial companies. For example, biomedical manufacturing and petrochemicals have high maturity levels in energy management. On the other hand, transport engineering has lower maturity levels, which means that sector may have an opportunity to embrace energy management principles.

The report also reveals that Singapore-based organisations, with local operations only, have a somewhat lower level of maturity in energy management, compared to business units of global multinationals and locally-headquartered multinationals.

The Accenture report recommends that policy makers could support companies by helping to establish internal reporting capabilities. A common set of tools would help businesses plot trends, identify energy intensive processes and measure their performance against benchmarks. The report also suggests that the variance in energy management maturity could be addressed if policy makers and companies collaborate to establish a common platform to share best practices across and within industry sectors.

“Companies that lag behind can now seize the opportunity through the ECA to catch up with the pack,” said Mr de Boer. “Singapore companies could work towards achieving greater benefits if they aim for a more comprehensive Enterprise Energy Management approach, covering technology, people and processes in a way that supports transformational change, improves compliance and potentially reduce costs.”