The Role of Energy Audits in Optimising Business Costs

Tips and How-ToEnergy Efficiency 23rd August 2024

When it comes to businesses, whether they’re towering corporations or start ups, energy consumption looms large as a significant chunk of operational expenses. Consequently, business owners are constantly seeking innovative solutions to optimise their cost-effectiveness. Enter energy auditing—a pivotal tool in this quest for efficiency and financial cautiousness.

What is an Energy Audit?

An energy audit is a physical inspection or a survey conducted on homes, businesses, and other buildings led by an Energy Auditor to determine the energy the building uses. This allows the auditors to formulate ways and create a solid plan to reduce energy costs and greenhouse gas emissions.

Energy audits can be categorised into several types based on scope, depth, and purpose. Each type of energy audit serves different purposes and provides varying levels of detail and recommendations. The choice of audit type depends on factors such as the complexity of the facility, budget, and goals for energy efficiency improvements.

Here are the common types of energy audits:

Walk-through or Preliminary Audit

As its name suggests, the preliminary or walk-through audit is a facility walk-through around your business premises to identify energy use and performance. Thus, this is the simplest and quickest form of audit.

It involves a brief assessment of energy use patterns and basic recommendations for energy-saving measures. Typically, this audit includes a facility walk-through, reviewing past energy bills, and interviewing managers and staff about processes.

This assessment may be brief, but it can reveal clear energy-saving opportunities and provide qualitative insights into the potential savings from any new measures.

Detailed or General Energy Audit

Compared to the walk-through audit, the detailed or general audit is a more comprehensive type of audit that typically includes a more thorough inspection of energy systems and equipment. The results of this audit comprise data and additional information with various diagnostic tests, such as light levels, airflow, and temperature measurements. Hence, this is why they would take place over longer periods to provide a more in-depth energy consumption report.

Diagnostic or Comprehensive Energy Audit

The diagnostic energy audit is considered the third level of auditing where it is the most thorough compared to the two above. This process comprises a detailed analysis of energy use like the preliminary and detailed audit, but includes energy modelling and simulations. This extensive practice provides detailed and specific advice on investing in more sustainable energy solutions. Hence, this type suits companies with net-zero plans.

Apart from the previously mentioned audit types, there are lesser-known and specific audits that you ought to know more about.

Home Energy Audit

As the name suggests, this type of audit is specifically focused on residential buildings. This is similar to a walk-through audit but is custom to homes. The process for the home energy audit assessors is that they will conduct a room-by-room examination of the residence, including a thorough examination of energy use, energy bills, and basic building envelope and HVAC system inspection. Big residential buildings will be provided with recommendations for future energy-saving.

Industrial Energy Audit

This is another specific type of audit that targets industrial facilities. This involves a detailed assessment of energy use in manufacturing processes, HVAC systems, lighting, and other energy-consuming systems. This includes process integration and optimization to reduce energy consumption.

Financial Audit

This type of audit focuses on the financial aspects of energy consumption and savings. Detailed financial analysis, such as payback periods, return on investment (ROI), and lifecycle costing of energy-saving measures is what you can get from this auditing.

How do you know which energy audit is right for you?

Each of the above audit types is for a specific reason and depends on the target outcome. If you aim to identify potential savings for further studies, a Walk-Through Audit is the best choice, as mentioned above.

Also, different audits have different prices, so your budget should be considered when choosing the most appropriate type of energy audit for your needs.

How do Energy Audits work?

Energy auditing involves a systematic approach to understanding and optimising energy use. Here are the key steps to help you understand and show that this process is not as complex as you think.

• The company prepares a financial report in compliance with relevant legal and financial standards.
• The auditor obtains an understanding of the company, considering external factors that may have affected its operations during the reporting period. This is where data gathering takes place. Detailed information on energy consumption patterns, operational schedules, and physical characteristics of the facility are taken into consideration.
• The auditors analyse the financial information. Here they assess and evaluate risks and examine the company’s infrastructure to know the effectiveness of risk mitigation protocols.
• After identifying risks, the auditor reviews the financial report, ensuring its accuracy in light of these risks.
• Using their understanding of the business and identified risks, the auditor determines their approach.
• The auditor conducts a test on financial information supporting the financial report and issues an opinion on its accuracy.

Why do businesses need it?

An audit offers a comprehensive view of your company’s current energy consumption, providing insights into areas that could potentially be draining your finances.

Conducting an energy audit can elucidate your company’s energy usage and pinpoint opportunities for savings, potentially resulting in decreased energy consumption, enhanced productivity, and avenues for innovation.