What is an Energy Management System, Why Use One and What are the Benefits?

19th October 2023

what is an energy management system, why use one
franziska curran anthesis

Franziska Curran

Principal Consultant


Increasing gas and electricity prices and volatility, a changing climate, and the need to target net zero emissions have all combined to create an era of uncertainty around the future of energy use in Australia. This is of particular concern for businesses with high energy consumption.

What is known is that we need to get better at managing energy, and we need to find systematic ways to reduce our consumption.

This is what an Energy Management System can offer – a sophisticated and clear path forward, to lower risks, reduce costs, and support energy-based action towards net zero.

What is an Energy Management System?

An Energy Management System – or EnMS – is a systematic planning tool that assists companies to understand their energy consumption, align stakeholders, and implement continuous improvements in the way an organisation uses energy.

Central to an EnMS are both technical and stakeholder elements. The process is structured around Objectives, Targets, and an Action Plan – which in alignment, form the backbone of an EnMS. They inform energy managers what the current energy use is, where they are headed in regard to energy management efficiencies and why changes are important.

Another core element is understanding and measuring the Energy Performance Indicators (EnPIs) related to Significant Energy Users (SEUs). Understanding how much energy is being used, how measuring progress is tracked will feed into the targets. EnMS processes for measuring, tracking and reporting EnPIs against targets, is the powerhouse of an EnMS that will make improvements and get things done.

Companies can also align their EnMS to be certified under the international EnMS standard, ISO50001. This provides the benefit of a detailed and comprehensive, industry-backed standard to guide their framework.

energy management system - eaguk.org - ndevr environmental
image source: eaguk.org

What are the benefits of an Energy Management System?

Energy is a critical component of business with a high cost and high contribution to greenhouse gas emissions. Therefore the efficient management of energy, especially for larger businesses is key to managing high and often volatile costs and also managing the transition to a lower emissions future. 

The benefit of a high-quality, comprehensive energy management system is that it serves as an overarching method to measure, monitor and achieve best practice in the use of energy resources. 

An effective energy management system provides a framework of practical processes and procedures to deliver on an organisation’s energy objectives.

What kind of business should use an Energy Management System?

Every business and its requirements are unique, and key to the successful implementation of an EnMS is that it is aligned with existing business priorities and systems. The EnMS should be a key component of an organisation’s broader continuous improvement efforts and is applicable for any organisation that wants to understand and reduce energy consumption.

Companies of different sizes can benefit from an EnMS to gain insights into their energy consumption and demand. An EnMS is a must for high energy users such as manufacturing and processing plants, who report under the National Greenhouse and Energy Reporting Scheme (NGERs), and is applicable to anyone who manages multiple assets that consume energy, such as building managers.

Many companies and facilities that consume a lot of energy typically have sophisticated ways of measuring and tracking energy consumption but may be a step away from bringing these processes together into a coordinated EnMS.

Taking the first steps to implementing an Energy Management System

For organisations with the resources and budget to implement an Energy Management System, here are some important steps to consider upfront:

  1. Ensure senior management commitment: Implementing an EnMS is no small endeavour, and prior to implementation it is essential to confirm senior management understands the benefits and resourcing requirements to ensure the EnMS will be supported.
  2. Build your team: Select an EnMS Champion in the leadership team and identify staff across the business who would be enthusiastic participants in a team-leading and implementing the EnMS. Consider leveraging an external technical expert to bring the EnMS framework together.
  3. Take stock of existing processes: This could be a self-gap assessment to identify what elements of an EnMS framework are already in place, and how pre-existing processes may fit together. At this stage, it is worthwhile considering whether aligning with ISO50001 would suit your needs.
  4. Resourcing: Address the gaps from the outset to implement the EnMS with the best chance of success.

As global and national drivers for climate change push for net zero and other emissions reduction targets, energy efficiency plays a central role in the transition to a low carbon economy. Putting processes in place to effectively manage and reduce energy consumption will help reduce exposure to risk, and enable businesses to get ahead of the game in the race to net zero. For large energy users, an EnMS can play an important role in this transition.