Cost Avoidance

Cost Avoidance is the measurement and verification (M&V) of energy and cost savings because of energy management projects. The result is the dollars you avoided spending because of the implementation of energy management activities.

EnergyCAP UtilityManagement™ Cost Avoidance methodology and core calculations date back to 1982, when EnergyCAP UtilityManagement’s predecessor (FASER Energy Accounting) first introduced Cost Avoidance. UtilityManagement uses the Whole Facility Method in the International Performance Measurement & Verification Protocol (IPMVP). Members of the pioneering team of software engineers and developers who introduced Cost Avoidance are still refining and enhancing EnergyCAP UtilityManagement today. Over the years, these principles have served the needs of thousands of energy managers and assessed billions of dollars in energy management projects.

EnergyCAP UtilityManagement calculates the savings attributable to energy management by comparing current bills with an adjusted baseline year. The process automatically accounts for major variables, including weather (degree days), billing period length, floor area changes, and commodity price, and lets you enter adjustments for other changes such as occupancy, schedule, and equipment retrofits.

Accurate cost avoidance analysis of energy saving projects helps you make better decisions about future spend. Knowing exactly how much energy you’re no longer using, and paying lower bills, opens opportunities to fund other projects, add tools, and address staffing needs.

Energy management projects look vastly different across industries. Retail may focus on lighting and HVAC adjustments based around traffic foot patterns, while large government, higher education, and commercial campuses prioritize installing more efficient materials across all of their buildings. No matter what industry you serve, quantifying the outcome of your energy saving projects is key to managing and controlling energy costs.