guidelines for implementing iso 50001 energy change · 4.4.3 energy review 5 ... (enms) ensures...

Guidelines forimplementing ISO 50001 EnergyManagement Systemsin the oil and gas industry

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OGP Report Number 482

Guidelines forimplementingISO 50001 EnergyManagement systemsin the oil and gas industry

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GUIDELINES FOR IMPLEMENTING ISO 50001 ENERGY MANAGEMENT SYSTEMS IN THE OIL AND GAS INDUSTRY

Contents

Purpose of this guide 1

Guidelines for implementing ISO 50001Energy Management Systems in the oil and gas industry 2

1. Scope

2. Normative references 2

3. Terms and definitions 2

4. Energy management systems 2requirements

4.1 General requirements 2

4.2 Management responsibility 2

4.2.1 Top management 2

4.2.2 Management representative 2

4.3 Energy policy 4

4.4 Energy planning 5

4.4.1 General 5

4.4.2 Legal and other requirements 5

4.4.3 Energy review 5

4.4.4 Energy performance indicators 8

4.4.5 Energy baseline 11

4.4.6 Energy objectives, energy targets and 11energy management action plans

4.5 Implementation and operation 12

4.5.1 General 12

4.5.2 Competence, training and awareness 12

4.5.3 Communication 13

4.5.4 Documentation 13

4.5.5 Operational control 14

4.5.6 Design 14

4.5.7 Procurement of energy services, 14products, equipment and energy

4.6 Checking 15

4.6.1 Monitoring, measurement and analysis 15

4.6.2 Evaluation of legal requirements 15and other

4.6.3 Internal audit of the EnMS 15

4.6.4 Nonconformities, correction, corrective, 15and preventive action

4.6.5 Control of records 16

4.7 Management review 16

4.7.1 General 16

4.7.2 Input to management review 16

4.7.3 Output from management review 16

The oil and gas industry is energy-intensive.Energy efficiency and energy savings have longbeen essential to the industry’s operations. Theytranslate into cost savings and have in recent yearsassumed even more relevance in the context ofgreenhouse gas (GHG) emissions reductions, aswell as higher fuel prices and energy supplyconstraints in certain regions of the world. Energymanagement through a well-structured ‘energymanagement system’ (EnMS) ensures that energyissues are properly taken into consideration in allaspects of the industry’s activities.

In July 2011, the International Organization forStandardization (ISO) released the ISO 50001standard, Energy management systems—Requirements with guidance for use, whichprovides the essential framework and guidelinesfor establishing and operating an energymanagement system in general terms.

Beyond the generic guidelines andrecommendations of the ISO standard, thisdocument provides further guidance from a morespecific, oil and gas industry perspective, andincludes examples and case studies directlyrelevant to oil and gas organizations andoperations. It should be read in conjunction withISO 50001.

The aim of this document is to assist the oil and gasindustry in the creation and implementation ofenergy management systems in accordance withISO 50001. It is in no way intended to define orimpose rules, constraints or additional requirementsto the oil and gas industry beyond what is requiredby ISO 50001. It merely clarifies and interprets theISO standard in the context of oil and gasoperations, and provides contextual exampleswhere relevant.

The structure of this document mirrors that ofSection 4 of ISO 50001, as described in a publiclyavailable ISO publication (ISO, 2011). Some sub-sections of ISO 50001 are self-explanatory andare directly applicable throughout the oil and gasindustry. In such cases, no additional guidance isprovided beyond a short interpretation of the ISOtext where appropriate. For other sub-sections,there are specific circumstances or existingpractices in the oil and gas industry or in itsdifferent sub-sectors (upstream, midstream anddownstream) which warrant additional guidance,and this is presented mostly in the form of achecklist and/or good practice examples.

Where relevant, other public documents are alsocited as references.

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Purpose of this guide

1. Scope

No oil and gas-specific comments.

2. Normative references

No oil and gas-specific comments.

3. Terms and definitions

The terms and definitions given in ISO 50001 arevalid for this document.

4. Energy management systemsrequirements

Many sites or companies in the oil and gasindustry have already implemented managementsystems, mostly in the fields of quality (ISO 9001)and environment (ISO 14001). This shouldfacilitate implementation of an energymanagement system (EnMS) following ISO 50001because most requirements are of a similar nature,in particular those related to record keeping. Inthose cases where an EnMS is to be implementedas a stand-alone system, it may be necessary todefine basic processes.

Some oil and gas companies in Europe havealready adopted the EN 16001 European standardwhich addresses the same issues as EN 50001.With the promulgation of ISO 50001, EN 16001has now been withdrawn.

4.1 General requirements

Oil and gas industry activities encompass anumber of sub-sectors (upstream, midstream, anddownstream, with the latter split between refiningand distribution/marketing). Some oil and gascompanies are engaged in all sub-sectors whileothers only operate within a subset.

The scope of the EnMS may be company-wide,sector specific or may apply to specific sites (orsubsets within a site) at the discretion of eachcompany. In practice, certification to ISO 50001will often be obtained for specific sites. For eachsite, the boundaries are likely to be the same as forexisting ISO systems.

4.2 Management responsibility

4.2.1 Top managementActive top management involvement is recognizedas one of the key elements of any successful EnMS,in order to provide momentum, resources andcommunication within and outside the company.

Particularly in large organizations active in manydifferent sub-sectors, the appropriate level of ‘topmanagement’ needs to be considered carefully toensure a balance between a high level of visibilityand credibility, while being sufficiently close to thebusiness. The choice of management representativeshould follow the same considerations.

4.2.2 Management representativeThe size and composition of the ‘energymanagement team’ may be adapted to the scopeof the EnMS and may vary from a single person toa large team.

Even where the EnMS is company-wide and coversmany or all sub-sectors of the oil and gas business,consideration may be given to sector-focusedrepresentatives and/or teams in order to recognizeand capture the specific circumstances andrequirements of each sub-sector. Effectivecoordination at the corporate level should beconsidered to ensure cross-fertilization between sub-sectors, and consistent application of the commonEnMS principles and procedures and communicationthroughout the organization. Team members maybe recruited from different disciplines and companylevels to ensure that all relevant perspectives—strategic, operational/technical, environmental andeconomic—are taken into account.

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Guidelines for implementing ISO 50001 EnergyManagement Systems in the oil and gas industry

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Illustrative examples of energy management systems from specific oil and gas companies

Chevron

Chevron has implemented Energy Management Processes through its Corporate-wide OperationalExcellence System. Energy coordinators and/or Base Business optimization subject matter experts developand improve best practices that can be shared among business units and conduct energy assessmentsto assist in prioritizing energy conservation and optimization opportunities across the company.

ExxonMobil

ExxonMobil have implemented the Global Energy Management System (GEMS) throughout therefining and chemicals organizations. A related system, the Production Operations EnergyManagement System (POEMS), has been implemented in the upstream business.

Repsol

Organizational structure:

Planning

Organizational commitment

Processunits

Majorequipment

Utilitiessystems

Projectdesign

Personal accountability

StewardshipOperatingresults

Systemperformance

Continuous improvement

Management leadership

GEMS design

Management Leadership

Business Unit representatives(Business Unit EnMS sponsors)

TECHNICAL GROUP(Business Unit EnMS Coordinators)

EnMS Groups in each Unit (Business + Corporation)

Energy efficiencycoordination

Management group

Management Leadership: this personis in charge of the EnMS.

Each Business Unit has an EnMSRepresentative in this group.Normally these members are alldirectors; the reason is that they musthave the ability to make decisions(for example, related to the budgets).They manage the EnMS.

Each Business Unit also has an EnMSRepresentative in this group. This group has atechnical profile (it discusses objectives, plans,actions, etc.). It proposes improvements and actionsto be approved in the Management Group.

Each Business Unit has groups at Unit levels inorder to spread the energy efficiency programmesthrough their organizations.

Technical group

This groupcoordinates theTechnical Groupand givessupport to theManagementLeadership

4.3 Energy policy

The oil and gas industry is in the unique position ofbeing both an energy supplier and an energyconsumer. This may be reflected in the corporateenergy policy. Energy policies may be expressed in

stand-alone documents or integrated into existingenvironmental, HSE (health, safety, environment) orsustainability policies.

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Illustrative examples of energy policies from specific oil and gas companies

Repsol undertakes a commitment to make efficient use of energyat its facilities and during its activities, with the purpose ofpreserving natural resources, reducing atmospheric emissionsand helping to mitigate the effects of climate change.

Management will lead and promote energy efficiencyprogrammes, ensuring that the organization works inaccordance with the principles established in this policy.

Repsol will establish objectives and targets in order toimprove energy performance and reduce the relevantgreenhouse gas emissions. In order to achieve them,Management will ensure the availability of the necessaryinformation and resources.

Repsol will continuously improve the use of energy resourcesat its facilities and during its activities throughout their entire lifecycle, optimizing the technology and design of processes as wellas the operation of its facilities, and supporting the purchase ofenergy-efficient products and services.

Repsol will ensure compliance with the legal requirements inforce and other requirements to which the organizationsubscribes related to energy performance, including energyefficiency and the use and consumption of energy. The companywill also encourage the adaptation of its operations andfacilities to ensure compliance with any changes that may bemade to the legal framework in force, and will establishcommon standards for the management of energy efficiency inall the areas and countries in which it operates.

In order to promote greater awareness among allstakeholders, Repsol will provide them with reliable andtransparent information regarding its energy consumption, itscorresponding greenhouse gas emissions and the improvementactions undertaken.

Repsol considers that ‘complying and ensuring compliance’with this policy is the responsibility of all individuals who takepart in its activities.

Repsol energy policy

Chevron has incorporated energy performance into its businessfor more than two decades. In 1991, the company created theposition of Corporate Energy Coordinator and established theChevron Energy Index to monitor and foster energy improvementscorporate-wide. Since then, Chevron has improved its energyperformance by more than 30%.

To drive this agenda forward, Chevron is running two keyinitiatives: 1) to improve energy performance in existingbusinesses by developing and deploying Chevron best practices;and 2) to economically design new facilities with high levels ofenergy efficiency. Since energy costs (within a large energycompany) typically represent about 25–50% of total operatingexpenses in the company’s largest business segments, energyefficiency improvements also contribute to large cost savings.The points below provide an overview of Chevron’s lessonslearned and key energy efficiency principles.

1. Create a long-term vision of what excellence looks like inbusiness segments to help keep alignment and move towardsindustry-leading performance.

2. Create a culture where best practices are created, shared andfreely adopted.

3. Implement industry-leading targets and ensure consistency incalculation of performance gaps to industry-leadingperformance.

4. Use internal and external benchmarks to identify improvementopportunities.

5. Conduct internal energy reviews to provide expert feedback tolocal management.

6. Track and manage key energy metrics. 7. Focus on new projects with a secondary focus on replacing

equipment in existing projects.

Incorporating energy performance into Chevron’s business

4.4 Energy planning

4.4.1 GeneralEnergy planning and its elements described belowform the core of the EnMS. The first step is theenergy review which includes an inventory of pastand present energy use, a list of the variablesaffecting energy consumption, a definition of whatconstitutes a ‘significant energy use’, and ananalysis of these factors. It is followed by theselection of energy performance indicators. Thefinal outcome is the definition of an energy baseline.

4.4.2 Legal and other requirementsOil and gas companies are bound by the lawsand regulations of the countries in which theyoperate. Local personnel must be fully aware ofthe relevant energy-related national legislation,the requirements outlined by operating permitsand the constraints they impose and opportunitiesthey afford.

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A generic inventory of some energy consuming activities

Exploration:• Seismic

Field development:• Area clearing• Road construction• Infrastructure set-up• Drilling waste transport and treatment• Hydraulic fracturing• Construction of facilities• Raw materials• Transport and installation

Production:• Extraction (inc. pumping, gas lift, etc.)• Treatment (including utilities)• Auxiliaries (e.g. supply ships, living quarters,

workers’ transport, etc.)

Crude oil and gas transport:• Pumps and compressors (pipelines)• Rail, road and ship transport

Refining/petrochemical plants:• Process plants• Utilities• Tank farms• Auxiliaries• Terminals

Distribution:• Terminals• Depots• Rail• Trucks• Pipelines• Barges

Marketing:• Service stations

Site abandonment:• Demolition• Waste disposal

This list is for illustration only and is not exhaustive. It should be adapted to each specific case.

In view of the international character of thebusiness, certain activities may also need to conformto the laws and regulations of multiple countries.Corporate levels EnMS need to take this intoaccount so that they can accommodate compliancewith a diversity of regulations. Site level EnMS mustbe fully compliant with applicable local regulations.

4.4.3 Energy reviewEnergy planning implies an inventory of allsignificant energy consuming activities. In anorganization involved in many activities along theoil and gas supply chain, this may not be a trivialexercise.

In determining the scope of energy consumingactivities to be taken into account, considerationneeds to be given to the inclusion or exclusion ofenergy consumed by third parties on behalf of thebusiness (e.g. in transport or provision of services).

Frequency and depth of the review should reflectall relevant factors such as the age of the facility,previous reviews, progress already made,coincidence with maintenance outage ofequipment, structural opportunities, etc.

The inventory of energy-consuming activities shouldinclude, where relevant, the whole life cycle ofprojects from construction to abandonment. It canbe linked to the register of environmental impactselaborated under the scope of ISO 14001.

Information is commonly collected and generatedthrough:● operational data (from process data,

measurements, invoicing etc.);● energy assessments;● specific energy studies (in-depth studies to

improve a process); and● total site studies (to identify synergies between

plants).

Energy consumption figures should, preferably, beestablished on the basis of actual plant data althoughdesign data may be used as a second choice.

A critical review of the inventory may be carriedout to identify the most significant energyconsumers which might warrant further analysis.Definition of a ‘significance’ threshold becomes animportant matter in this respect. ISO 50001 doesnot impose criteria to define ‘significance’ butleaves it up to each organization to determine this.When first implementing an EnMS, a practicalapproach may be to first set the significancethreshold at a fairly high level in order to focusinitially on the larger energy consumers, leaving thesmaller ones to be dealt with in later reviewsand/or cycles. Significance criteria could bedefined using thresholds for absolute, specific orrelative indicators, e.g. above a certain totalenergy consumption (GJ); above a certain specificenergy consumption (GJ/t production); above acertain percentage of a site’s or company’s totalenergy consumption considered ‘material’; or a

certain percentage above an internal/externalbenchmark value.

In many of the complex operations common in theoil and gas industry, a simple tally of energy usedoes not provide a good basis for a validcomparison between figures from different operatingsites, or even from the same site over time.Performance analysis usually requires definition ofnormalized data (e.g. to allow for different levels ofactivity, different types of equipment, etc.) and/orperformance indicators (see 4.4.5).

An organization can improve its energy efficiencyover time through optimizing operating conditions,improving maintenance schedules and practices,sharing good practice and integrating the energydimension into all new projects (new units orrevamping of existing plants). The first two pointsare commonly addressed through on-site energyreviews or assessments involving a specialist teamvisiting a site over several days and working closelywith the local personnel. After making an inventoryand analysing performance, the team focuses onidentifying specific areas for energy performanceimprovement, and on developing concreteproposals and prioritizing actions.

Good practice may be derived from either in-company or wider industry experience.Opportunities may involve operationalimprovements, organizational changes, and minoror major investments. The experience gained by thevisiting teams helps dissemination of good practice.

Energy saving proposals are often categorizedaccording those items that require:● no investment (mostly related to improving

operation of the units);● minor investment (mostly related to minor

modifications and maintenance); and● significant investment (mostly related to

implementing new technologies or more efficientsystem designs).

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The first two categories usually focus onoptimization of existing systems and equipmentthrough operation or maintenance, and onimplementation of minor physical changes. Theymay address distillation processes, heaters andboilers, heat exchange and recovery systems,flares, steam system optimization, thermalinsulation, reduction of steam leakages, electricityproduction, major rotating equipment, fuelselection, housekeeping, etc. Up-to-date drawingsand manuals, and fit-for-purpose and correctlycalibrated metering devices are essential tomonitor energy consumption of the mainequipment. Modelling, optimization or advancedprocess control systems help achieve optimaloperating conditions in process units and utilitynetworks over time.

The third category may address heat integrationand recovery (new/additional heat exchangers,optimization/rearrangement within process unitsand/or between units), installation of moreenergy-efficient equipment (e.g. burners, majordrivers), use of excess gas or pressure energy (lostenergy through pressure drops), e.g. for powergeneration, upgrading of utility systems (combined

heat and power), and optimization of hydrogenproduction systems in refineries.

The Energy Star® programme, sponsored by theUS EPA, developed a useful detailed guide in thisrespect (LBNL, 2005).

The energy review invariably results in a largenumber of proposals that need to be prioritized.Clear prioritization criteria may be appropriate atthe outset. They are usually based on acombination of saving potential and financialreturn where significant costs are involved. The80/20 rule will generally apply, i.e. 20% of theproposals providing 80% of the potential savings.

The energy review should be documented in areport detailing the energy consumption structure,the improvement proposals and the intended timeschedule for implementation, as well as allsupporting technical data.

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Illustrative examples from specific oil and gas companies

ExxonMobil

Global Energy Management System (GEMS) best practice manuals

• Best practices are documented in a 12-volume set for:• Process units• Major equipment• Utilities systems• Project design

• Contain 1200 pages and identify more than 200 key energy variables

• Cover process units, major equipment and utilities

• Focus on key energy-related aspects of operations and maintenance

• Also incorporate energy efficiency into project design for new facilities

GEMS development

4.4.4 Energy performance indicatorsOil and gas operations are generally complex,involving many sub-activities with a high level ofvariability both between similar operating sitesand over time. Performance indicators that takethis diversity into account are therefore essentialfor understanding and analysing energyperformance. Energy performance improvementrequires efforts and actions at all levels of theorganization with indicators that are relevant andadapted to each level.

Definition of indicators should be as accurate aspossible, outlining scope and boundaries andidentifying the metric. They should preferably bein line with international reporting standards toallow for comparison and internal and externalbenchmarking. When evaluating energyefficiency using these indicators, care must beexercised to compare them in like categories.Indicator values will reflect energy efficiencyachieved by operational efficiencies and specificimprovement projects, but the overall values willvary greatly depending on many factors (e.g. forupstream, the type of hydrocarbon, reservoircharacteristics including age, the recoverymethod(s) employed, etc.).

Indicators based on operational data (lagging)Energy performance is commonly assessed with‘lagging indicators’ which are retrospective metricsbased on actual operational data, reflecting the as-is situation on energy performance.

Operational level indicatorsThese are typically relatively simple processfunctions calculated on a semi- or fully-continuousbasis serving to measure and monitor energyusage over the short term, down to a singleunit/facility.

They are commonly developed for each site andeach processing entity according to the specificlocal situation (see also 4.5.5).

Care must be taken to account for different qualitylevels of either products or resources whenassessing energy performance. One approachcould be to use exergy-based indicators ratherthan energy-based ones1.

Site level indicatorsThese are based on aggregated data from the siteand are commonly calculated on a quarterly oryearly basis. They serve to measure and monitorthe energy efficiency of the site over time and/oragainst peers.

Absolute energy consumption (in units of energyper year) may be used for management and/orfinancial reporting purposes but is of little interestas an energy performance indicator because itdoes not refer to the corresponding level of activity.

Specific energy consumption (expressed in units ofenergy per unit of production or feedstockprocessed) is a commonly used indicator. It is oftenreferred to as energy intensity. This is, however, oflimited use for comparison or benchmarking offacilities of different complexity or asset type (e.g.gas field/plant vs. oil field).

In many parts of the oil and gas industry, energyconsumption is the result of a combination of alarge number of factors. In oil and gas upstreamproduction operations this may include location,climatic conditions, reservoir characteristics, age,etc. In refining, energy consumption is dictated notonly by size (e.g. in terms of crude processing) butalso, and in a major way, by the complexity of therefinery. As a result, each operating facility has itsown structural energy consumption that reflects thespecific tasks that it carries out and the environment

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1 For a definition of exergy see http://en.wikipedia.org/wiki/Exergy

in which it operates. The specific energyconsumption, a relatively simple metric, may beinadequate as an energy performance metricbecause it does not account for this diversity.

In the refining sector most companies rely on theEnergy Intensity IndexTM (EII®) developed bySolomon Associates.

With the possible exception of shipping(IMO, 2009), industry-wide indicators have thusfar not been used in other oil and gas sub-sectors,particularly in upstream oil and gas production.

Corporate level indicatorsIn complex organizations, central monitoring andcommunication with corporate management can befacilitated by company-wide consolidated indicators.A problem that may occur is the use of different basesfor different operational units (e.g. barrels oil or gasproduced in upstream activities; tonnes of crudeprocessed in refineries; volumes of product sold,etc.). Site level indicators therefore need to be definedin a way that allows appropriate unit conversionfor later consolidation. A balance needs to bestruck between monitoring needs at corporate leveland the reporting effort this creates at the site level.

Indicators linked to EnMS implementation(leading)Implementation of an EnMS provides theopportunity to develop so-called ‘leading’indicators which, although not directly related toenergy performance, monitor the achievements inthe key work processes or managementapproaches, reflecting the status of implementationof certain EnMS elements. Examples include:● number of energy inventories done;● percentage of completed energy assessments

compared to plan;● number of energy-related non-conformities

(where operational practices or equipment meetcompany standards or good practice);

● percentage of energy-related improvementactions completed compared to plan;

● percentage of supplier assessments whereenergy has been included; and

● coverage of sites with EnMS.

Definitions and calculation considerationsExamples of some basic concepts and theirdefinitions are included below, ordered by level ofcomplexity. These types of indicators can bedefined for any type of facility, irrespective of sizeor configuration:

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Solomon Associates — Energy Intensity Index™ (EII®)

In close cooperation with the refining industry worldwide, Solomon Associates have developed their EnergyIntensity Index™ or EII® as the dimensionless ratio of the actual energy used by a refinery divided by astandard energy usage.

Each generic process unit type used in refineries has been assigned a standard energy factor determined bySolomon Associates from an analysis of their extensive dataset covering the majority of world refineries overa period of up to 30 years.

The standard energy usage of a refinery for a given period is the sum product of the individual factors bythe throughputs of the process units operated by the particular refinery during that period.

The EII® effectively takes into account both size and complexity, so that the EII®s of different refineries,and/or the EII® of a given refinery over time, can be validly compared. The lower the index the better theperformance.

a) Total energy consumption of a facility:This refers to the total amount of energyconsumed by the facility. It depends on theproduction level of the facility. More energy isused for higher activity levels than for lowerlevels. Values are obtained from meters, controlinstrument measurements, energy balances, etc.

b) Energy intensity, specific energy consumption,or fuel economy:For each sector, group, plant or facilitycharacterized by a single activity, the specificenergy consumption is the ratio of total energyconsumption of the activity or facility per unit ofactivity, measured in (energy units)/(productionor activity unit). Examples include:

• Transport sector: fuel used (energy units) perkm, or passenger kilometres driven, or percargo tonne km.

• Industrial sector: total energy consumed(including electricity, natural gas, and otherfuels) per tonne of product or per energy-equivalent mass or volume.

• Residential and commercial sectors: electricityuse per unit of surface area or volume.

• Electricity sector: power plant efficiency(GJout/GJin). For combined heat and powerplants, efficiency calculations need to takeinto account both electrical and thermaloutputs.

c) Energy intensity indicator or intensity index:The Energy Intensity (EI) indicator of a businessunit or facility compares its actual energyconsumption with the consumption a referencefacility with the same characteristics and activityas defined in Section 4.4.5.

In practice, the following equation can be used:

For a group of facilities, the energy intensity canbe calculated as:

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Illustrative example from specific oil and gas company

ExxonMobil

GEMS measurement: the following diagram illustrates the overall approach taken by ExxonMobil,from corporate level to field operator.

GEMS measurement

Corporate andplant management

Business teamsProcess engineersEquipment specialists

Shift supervisionConsole operatorsField operators

Plant/siteEnergy indexEnergy expenseProfitability

Area/complexImplementationLost opportunity

Unit/equipmentTargets and handlesActionable

Globalmeasures

Diagnosticindicators

Key energy variables

EI Indicator =Real Energy Consumption year X

Reference Energy Consumption year X

According to the same principle, a referenceenergy consumption could also be estimated,assuming that specific consumption corresponds toa reference value (in general for one year, calledyear/baseline). For a given year x, the baselineconsumption would be calculated with the followingformula:

Baseline Energy Consumption year X / reference =

∑ (Specific Consumption Reference x Activity Year X) facility

This value can be regarded as the ‘business-as-usual’ energy consumption, assuming individualplants operate at the same specific energyconsumption in all periods. To account for seasonalfluctuations in specific energy consumption, anannual average value can be used.

Where calculation of specific consumption iscomplex, statistical methods can be used.

It may be useful to differentiate between ahistorical baseline (past to present) and a projected‘business as usual’ baseline, and perhaps aprojection based on full implementation of goodpractice and standards.

4.4.6 Energy objectives, energy targets andenergy management action plans Overall objectives should be defined and beconsistent with the wider vision and objectives ofthe organization. They should then be translatedinto objectives and practical targets for eachsegment of the business, for each site andeventually for each processing entity withcorrespondingly decreasing time horizons.

A business segment or a site would typically haveyearly targets whereas operational indicators in aprocess unit would have to be met by each shift.Targets are often conveniently expressed in terms ofimprovement of the performance indicators over time.

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This indicator shows how the actual energyconsumption of facilities improved or worsenedcompared with a base year. Periodic monitoring ofthis indicator helps a facility track the relative statusand progress of its energy management activities(maintenance, operation, etc).

To determine the EI index of a business unit, oneneeds to know the Specific Consumption (SC) foreach production facility for both the reference yearand the year that is being studied.

Energy savings can be calculated based on percentchanges of an EI indicator relative to its base year.For example, using a base year of 1990, thenEI1990 = 1. If, for example, in 2010, EI2010 = 70,then this would represent a 30% energy saving in2010 compared to the energy that would otherwisehave been used in 2010 at 1990 levels.

4.4.5 Energy baselineThe energy baseline is one of the outputs of theenergy review. It is the quantitative reference to beused for assessing future actual data. It reflects thescope of activities under review. To be directlyuseful the baseline must be performance-basedwith normalized data and/or performanceindicators.

Additional guidance documents on energybaselines for both projects and for monitoring ofoperations are in preparation at the ISO.

One way to construct a baseline for monitoringcould be by assessing the reference energyconsumption for a facility for the current year (N)according to the specific consumption of individualunits or plants for the previous year:

Baseline Energy Consumption Year N =

∑ (Specific Consumption Year N-1 x Activity Year N) facility

EI Indicator =∑ (Specific Consumption Year X x Activity Year X) facility

∑ (Specific Consumption Base Year x Activity Year X facility

Objectives and targets at all levels should beregularly updated to reflect and take account of theresults of previous energy reviews in terms ofspecific items to be improved.

4.5 Implementation and operation

4.5.1 GeneralNo oil and gas-specific comments.

4.5.2 Competence, training and awarenessCompetences fall into two main areas:● the EnMS itself, i.e. all competences and

knowledge necessary for all actors to be aware,understand, operate and control the EnMS; and

● energy science, i.e. the technical understandingand expertise required to inventory and analyseenergy usage, and identify and take advantageof opportunities for improvement.

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Total

Cross-cutting matrix of the energy performance management framework

Holding Divisions

Commitments/Action plans

Subsidiary/Site/UnitsSector of activity(Business unit)

STRATEGY-VISION

OPERATIONS andPROJECTS

MANAGEMENT/ORGANIZATION

COMMUNICATION/INFORMATION/AWARENESS

R&D andTECHNOLOGY

operations/maintenance

new project

Energy CommitteeInput GroupPolicy

Corporate SocialReporting (CSR)

Energy Efficiencyand Environment

Energy auditframework

Road mapAction planTrainingSeminar

Scientific DivisionCorporateTechnology Group

GlobalKey PerformanceIndicator (KPI)

EE design

LTP

Ad hoc committee

Commitment andmotivation policy

TechnologicalinnovationsBest AvailableTechniques (BAT)

Consolidation/aggregation

Energy reporting

Identification ofmajor contributors

Good practices

Energy performance benchmarks

Technical standards

Steering/Coordination/Energy focal point

Implementationaudit methodology

Technologicalexpertise

Awareness campaign

Energycorrespondent

Energy audit/Energy balance/Gap analysis/Action plan

Energy performance objectives

Identification ofdetailed energyperformanceindicators

Instruments

Daily optimization

The degree to which energy science expertiseneeds to be developed in-house depends typicallyon the overall policy of the organization and itssize. Larger organizations may consider havingtheir own energy experts and assessment teams,whereas smaller companies may rely on externalexpert consultants.

A training plan may be included in the overallenergy planning cycle.

4.5.3 CommunicationInternal communication on energy-related issuescan make use of existing communication paths forenvironmental and safety topics. During theimplementation phase of the EnMS it could besufficient to perform a communication campaignfocusing solely on energy issues, and informingstaff about the EnMS itself as well as about therelated policies, targets and action plans in place.A communication plan may be included in theoverall energy planning cycle.

A successful communication campaign increasesawareness of all company staff of the importanceof good energy management, and motivates staffto achieve good energy performance and savings.

For external communication, the energy-relatedtopics can be easily integrated into existingenvironmental or sustainability reports (but it maynot necessarily be limited to this).

4.5.4 DocumentationThe documentation system required to run theEnMS and fulfil the requirements of ISO 50001(e.g. type of documents, information flows, controland archiving) is expected to have much incommon with what is necessary for other ISOstandard series such as ISO 9000 and 14000. Ahigh level of integration with such existingdocumentation systems may be sought.

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Illustrative example from specific oil and gas company

ExxonMobil

GEMS roll-out process:

GEMS roll-out process

3–6 monthspreparation

PreparationSite orientation

Select and train teamGather and review data

Arrange logistics

DeliverablesGap assessment

Gap closing optionsCost/benefit analysis

Milestone plan

Operations improvementsProcess units

Major equipmentUtilities systems

2–10 weeksexecution

0–8 yearsimplementation

Facilities enhancementsOptimizationsModifications

Additions

Transfer of ownership

Site

GEMS

4.5.5 Operational controlOperational level indicators are important tomaintain focus on energy use and efficiency, ensurethat energy is monitored and controlled where it isused, and identify deviations in performance at anearly stage. Operational procedures and workinstructions should be reviewed with regard toactivities influencing energy performance andrevised accordingly in order to ensure energy-efficient operation.

4.5.6 DesignThe original design of a facility can have a majorinfluence on its energy efficiency, impacting mostaspects of the operation of the future plant. (Seeillustrative example from Total.) Energyconsumption and efficiency should therefore be anarea of focus early in the design phase of anynew project involving either grass root facilities,new plants or major revamps at existing sites. Thisis particularly important in the latter case wherethe existing facilities and infrastructure will imposespecific constraints on, for example, heatintegration opportunities or installation ofadditional hardware. In all cases, it is preferableto take the whole site into account relative toenergy performance and the criteria used toassess it.

Energy-efficient design involves proper attention to:● the use of efficient energy converters (e.g.

electric motors, burners, variablespeed/frequency drives);

● minimization of heat/power/pressure losses;● optimization of pipe sizes to minimize life-cycle

costs;● heat and power integration, including optimum

use of waste heat;● integration/optimization opportunities with

neighbouring facilities;● application of best practice in building design

and construction; and● use of advanced, longer-life lighting systems

(e.g. LEDs).

In order to recognize the long-term value of energyefficiency clearly, it is essential that the future costof energy is accounted for correctly in projecteconomics, i.e. that the measurable benefits ofenergy efficiency be accounted for over the entirelifetime of the project. Building an energy-efficientplant may require additional investment but will bemore attractive than considering energy-relatedchanges at a later stage. Site-specific energyincentives, provided by local utilities, may also helpproject economics.

Another aspect of energy management is toconsider ‘life cycle’ energy performance over thelife time of an asset. For example, especially inupstream oil and gas operations, flow volumes canchange significantly over time as a field ramps upto peak production, perhaps levels out, and theneventually declines over time. If fluid productionand distribution systems are designed for maximumpeak capacity, then they will likely only operate fora limited time at design capacity, and may spendmost of their time at suboptimal operatingconditions which will degrade energy efficiencyand possibly lead to reliability issues. Designingfacilities to adapt to significant load changes overtime and maintain high efficiency operation couldlead to large operating expense savings over thelife of the asset.

Engineering standards and specifications as well asproject management procedures may be reviewedto reflect these requirements.

4.5.7 Procurement of energy services, products,equipment and energyISO 50001 requires the organization to evaluatethe lifetime energy performance of purchasedproducts and services that are expected to have asignificant impact on its overall energyperformance, and to make suppliers aware thatenergy performance is one aspect of theprocurement evaluation process. The standard ofenergy performance required for purchase approvalis for the company/organization to decide.

IPIECA • OGP

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4.6 Checking

4.6.1 Monitoring, measurement and analysisThe monitoring system required to run the EnMS isexpected to have much in common with what isnecessary for other ISO standard series such asISO 9000 and 14000. A high level of integrationwith such existing monitoring systems may beadvantageous. Monitoring results are used for theanalysis of all energy performance indicators.

4.6.2 Evaluation of legal requirements and other The compliance system required to run the EnMS isexpected to have much in common with what isnecessary for other ISO standard series such asISO 9000 and 14000. A high level of integrationwith such existing compliance systems may beadvantageous.

4.6.3 Internal audit of the EnMSInternal audits of the EnMS may be integrated inexisting audit schemes for quality or environmentalmanagement systems. A high degree of overlap

will occur, especially with regard to internal auditsas specified by ISO 14001.

Note that these are system or process audits. Theyare different from technical energy audits andreviews carried out under the EnMS.

4.6.4 Nonconformities, correction, correctiveaction and preventive actionThe continual improvement of energy performanceand the EnMS itself has much in common with whatis necessary for other ISO standard series such asISO 9000 and 14000 and, therefore, may followthe company’s existing procedures, e.g. the ‘plan-do-check-act’ approach. A high level of integrationwith existing systems for evaluation andinvestigation of nonconformities, as well as actionsetting and monitoring, may be advantageous.

The determination of nonconformities should bealigned with the organization’s energy policy andtargets, and should reflect the focus set by the

15



Total

Areas of energy focus at different stages of a project:

Scope of application

Daily monitoring of the system

Optimization of operating conditions

Maintenance of units and utilities networks

Improvement of reliability

Choice of process

Identification of improvement projects

Areas addressedin operational phase

Areas addressedin design phase

energy management plan. Examples of EnMS non-conformities include:● breaches of the criteria for efficient operation

and maintenance as defined under 4.5.5;● non-achievement of target values defined for

certain performance indicators as set under4.4.6;

● non-fulfilment of energy management plans asdefined under 4.4.6; and

● exceedance of deadlines for improvementactions as set under 4.6.4.

4.6.5 Control of recordsProcedures and systems required for record controlmay be similar to what may already be in place tocomply with other ISO standards such as the 9000or 14000 series.

4.7 Management review

The management review required under the EnMSis expected to have much in common with what isnecessary for other ISO standard series such asISO 9000 and 14000. A high level of integrationwith existing management review procedures maybe advantageous.

From the results of the management review,improvements and actions for the next activity cyclemay result. As a result of this review, the criteriondefining ‘significant energy uses’ for future activitycycles could be adjusted.

4.7.1 GeneralNo oil and gas-specific comments.

4.7.2 Input to management reviewNo oil and gas-specific comments.

4.7.3 Output from management reviewNo oil and gas-specific comments.

IPIECA • OGP

16

LBNL (2005). Energy Efficiency Improvement and Cost Saving Opportunities For Petroleum Refineries: An ENERGY STAR® Guide for Energy and Plant Managers. Ernest Orlando Lawrence Berkeley NationalLaboratory, February 2005, USA. www.energystar.gov/ia/business/industry/ES_Petroleum_Energy_Guide.pdf

IMO (2009). Guidelines for Voluntary Use of the Ship Energy Efficiency Operational Indicator (EEOI).International Maritime Organization, MEPC.1/Circ.684, 17 August 2009, London.www.mardep.gov.hk/en/msnote/pdf/msin0924anx2.pdf

ISO (2011). Win the Energy Challenge with ISO 50001. International Organization for Standardization,June 2011, Switzerland. www.iso.org/iso/iso_50001_energy.pdf

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References

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