NEW YORK — Firms with energy costs greater than 10 percent of total operating costs should invest in a new wave of industrial energy management software to achieve best-in-class operational excellence. This is the key finding in a new report from independent analyst firm Verdantix based on interviews with 127 energy directors in industrial firms and an assessment of energy software applications from 16 suppliers such as ABB, EFT Energy, IBM, Oracle, Schneider Electric, and Siemens.

Software helps firms minimize the impact of increasing energy costs. A Verdantix global survey found that 65 percent of industrial firms will spend more on gas and electricity in 2015 than in 2014. This reflects increasing energy prices. Since 2005, industrial electricity prices have increased by 4 percent annually in the U.S., 8 percent in Canada and the U.K., and by 14 percent in France. Over the same time period, natural gas prices for industrial firms have gone up every year by 15 percent in Japan, 10 percent in France and Italy, and 7 percent in Germany. Only in the U.S. and Canada have natural gas prices declined over this time period.

“As firms like Boston Scientific, Ford, and Pfizer battle to keep down operating costs, they have successfully reached out to industrial energy management software providers like EFT Energy to aggregate energy data, analyze usage trends, and visualize energy-efficiency programs,” said Alisdair McDougall, Verdantix industry analyst. “Forward-thinking industrial firms use energy-software applications to tackle energy resilience risks and cut costs from consumption during peak demand.”

Other findings from the Verdantix report, “Smart Innovators: Industrial Energy Management Software,” include:

• Innovative software suppliers such as Cascade Energy and Iconics compete with established enterprise software providers like Oracle and SAP as well as with global automation and controls suppliers, like ABB, Rockwell Automation, and Schneider Electric;

• Fragmented ownership of energy efficiency and a focus on maintaining plant output are the primary barriers to industrial firms investing in industrial energy management software; and

• Achieving ISO 15001 certification — which now exceeds more than 7,000 sites globally — strengthens the business case for investing in industrial energy management software.

“Energy managers considering an investment in industrial energy management software should follow five best practices for the RFP process,” said McDougall. “They need to assess data capture and IT systems integration, check alignment with processes, test analytical and energy modelling functionality, ensure scalability across sites, and certify configurability for different usage scenarios. Buyers should include proven specialists such as EFT Energy on their shortlists alongside software firms like OSIsoft and controls vendors such as GE and Honeywell.”

Publication date: 12/29/2014 

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