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Barriers to Energy Barriers to Energy EfficiencyEfficiency

Energizing Cleaner ProductionEnergizing Cleaner Production

Management Course Management Course

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Session Agenda:Session Agenda:

Review of barriers - approach

Four main barriers & examples

Guidance to policy makers

Role of companies, CP Centers and others

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Review of Barriers to Energy Review of Barriers to Energy Efficiency in IndustryEfficiency in Industry

Four steps:• Energy Efficiency Survey• Regional Stakeholder Workshop• Desk-top reviews of key barriers• Reporting

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Four barrier categoriesFour barrier categories

• Lack of management awareness

• Limited knowledge and information

• Lack of financing

• Limited policies and enforcement

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• task 1a: Meeting with top management• task 1b: Form a Team and inform staff• task 1c: Pre-assessment to collect general information• task 1d: Select focus areas• task 1e: Prepare assessment proposal for top management approval

Step 1: Planning and Organization

• task 2a: Staff meeting and training• task 2b: Prepare focus area flow charts• task 2c: Walkthrough of focus areas• task 2d: Quantify inputs and outputs and costs to establish a baseline• task 2e: Quantify losses through a material and energy balance

Step 2: Assessment

• task 3a: Determine causes of losses• task 3b: Identify possible options• task 3c: Screen options for feasibility analysis

Step 3: Identification of Options

• task 4a: Technical, economic and environmental evaluation of options• task 4b: Rank feasible options for implementation• task 4c: Prepare implementation and monitoring proposal for top

management approval

• task 5a: Implement options and monitor results• task 5b: Evaluation meeting with top management

Step 5: Implementation and Monitoring of Options

• task 6a: Prepare proposal to continue with energy efficiency for top management approval

Step 6: Continuous Improvement

Step 4: Feasibility Analysis of Options

• task 1a: Meeting with top management• task 1b: Form a Team and inform staff• task 1c: Pre-assessment to collect general information• task 1d: Select focus areas• task 1e: Prepare assessment proposal for top management approval

Step 1: Planning and Organization

• task 2a: Staff meeting and training• task 2b: Prepare focus area flow charts• task 2c: Walkthrough of focus areas• task 2d: Quantify inputs and outputs and costs to establish a baseline• task 2e: Quantify losses through a material and energy balance

Step 2: Assessment

• task 3a: Determine causes of losses• task 3b: Identify possible options• task 3c: Screen options for feasibility analysis

Step 3: Identification of Options

• task 4a: Technical, economic and environmental evaluation of options• task 4b: Rank feasible options for implementation• task 4c: Prepare implementation and monitoring proposal for top

management approval

• task 5a: Implement options and monitor results• task 5b: Evaluation meeting with top management

Step 5: Implementation and Monitoring of Options

• task 6a: Prepare proposal to continue with energy efficiency for top management approval

Step 6: Continuous Improvement

Step 4: Feasibility Analysis of Options

But first…But first…In what step(s) In what step(s) of the of the methodology methodology do we do we encounter encounter barriers to barriers to EE?EE?

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Lack of management awarenessLack of management awareness

• Company management awareness is essential to improving energy efficiency

• Root cause of other barriers:– Production is more important– Lack of investment capital– Limited policies/systems/processes– Hierarchical structures

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Lack of management awarenessLack of management awareness

Barrier: Focus on production output and turnover instead of• Producing safely• Producing more efficiently• Reducing production costs

Result: Energy assessment & option implementation difficult

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Lack of management awarenessLack of management awareness

Barrier:

Environment seen as• Compliance issue• Cost burden

Result: Companies not willing to look at environment unless they absolutely need to

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Lack of management awarenessLack of management awareness

Barrier:

“Only new technology can improve energy efficiency”

Result:

Less focus on low cost / good housekeeping options

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Lack of management awarenessLack of management awareness

Barrier:

Immature systems to manage energy, e.g.• Policies• Management systems• Environmental / Energy Manager

Result: • Management not sufficiently informed• Staff less able to take initiatives

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Lack of management awarenessLack of management awareness

Barrier:

Hierarchical management structures

Result: • Staff inhibited to give suggestions• Approval for options takes longer

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Limited knowledge and informationLimited knowledge and information

Barrier: Poor information systems• Few meters for electricity, water etc• Lack of monitoring equipment• Information held by different people• Lack of communication• Multiple sets of data• Limited data from contractors

Result: Not measuring is not knowing!!• No insight into energy/resource losses• Improvements from options cannot be measured

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Limited knowledge and informationLimited knowledge and information

Barrier:

Limited internal knowledge and expertise• Lack of training • Limited written procedures/documents

Result: • Energy losses through poor operations• Difficult to identify, investigate, implement

options

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Limited knowledge and informationLimited knowledge and information

Barrier: Difficult to access external information and expertise• Information scattered over many organizations• Language barrier• Internet access

Result:

Companies don’t know how to identify and solve problem

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Lack of financingLack of financing

Barrier:

Money available, but not now!• Budget round• Permission from head office

Result:

Delayed implementation (= sometimes no implementation!)

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Lack of financingLack of financing

Barrier:

Lack of money to invest in options• Long payback period• High investment• Unable to get a loan• Uneasy about taking loans• Perceived barrier???

Result:

Much less options get implemented than possible

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Limited policies and enforcementLimited policies and enforcement

Barrier:

Lack of effective policies

Focus on command-control policies (legislation)

Different per country!

Result:

Industry not encouraged by government to improve energy efficiency

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Limited policies and enforcementLimited policies and enforcement

Barrier: Weak enforcement of legislation• Limited funds for enforcement• Bribing of government officials is cheaper• Stealing of electricity

Result:

Continued environmental pollution / energy wastage

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Limited policies and enforcementLimited policies and enforcement

Barrier: Focus on short-term economic gain• Conflicting policies• Many agencies with role in energy• Under-pricing of resources• Subsidies of petrol/electricity

Result: • Companies more discouraged than

encouraged to reduce resource use• The economy wins (in the short term…)

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What can policy makers do?What can policy makers do?

Five step approach:• Analyze the problem & set scope• Identify main barriers• Identify existing and new policy

instruments• Evaluate policy instruments• Select policy instruments

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What can Companies, CP Centers What can Companies, CP Centers and others do?and others do?

This is what we need to know

from you!!!

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Barriers to Energy Barriers to Energy EfficiencyEfficiency

Thank you for your attention! Thank you for your attention!

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This training session was prepared as part of the development and delivery of the course “Energizing Cleaner Production” funded by InWent, Internationale Weiterbildung und Entwicklung (Capacity Building International, Germany) and carried out by the United Nations Environment Programme (UNEP)

The session is based on the report “Barriers to Energy Efficiency in Industry in Asia – a review and policy guidance” from the “Energy Efficiency Guide for Industry in Asia” developed as part of the GERIAP project that was funded by the Swedish International Development Cooperation Agency (Sida)

While reasonable efforts have been made to ensure that the contents of this publication are factually correct and properly referenced, UNEP does not accept responsibility for the accuracy or completeness of the contents, and shall not be liable for any loss or damage that may be occasioned directly or indirectly through the use of, or reliance on, the contents of this publication.

The report and references are available on www.energyefficiencyasia.org

AcknowledgementsAcknowledgements