The future of energy management

The technology to better manage production and energy systems is out there. Why is it taking so long for industrial plants to adopt it?

By Bill Holmes, Holmes AutoPilot

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In the early 1970s, I was part of the development team for the On-Condition Maintenance System for the F-15 fighter jet. It was the first computer-based advanced instrumentation system for a U.S. Air Force plane. It changed the whole concept of aircraft maintenance from one of scheduled maintenance to conditioned-based and predictive maintenance.

In the early 1980s, when I was an assistant professor at Purdue University and consulting with building owners to help them reduce their energy costs, I used what I had learned about monitoring airplane systems to design, build, install, and operate a similar system for all types of facilities. Using real-time screens and historical reporting, the system showed when, where, and how efficiently every utility dollar was spent within a facility. That first system evolved over time into the AutoPilot Industrial Diagnostics & Optimization System (iDOS) as it exists today.

The system was designed to monitor key parameters and continuously analyze the thermodynamic efficiency of not just production and energy systems but the facility as a whole as well. It also identified waste and diagnosed specific problems, allowing operations and maintenance to move from a reactive to a proactive approach.

I understood that what I learned in the Air Force about planes also applied to buildings. To fly a plane, a pilot must have real-time data on all aircraft systems and have it presented in a clear and easy-to-understand format – via cockpit gauges. To run a building efficiently, operators must have the same information.

Fast-forward to December 2016. Unfortunately, little real progress has been made in the past 35 years. Rather than energy professionals basing fees on creating, verifying, and maintaining actual savings, a billion-dollar industry has emerged based only on “preparing” to save energy. Practitioners make their money from energy auditing, benchmarking, training classes, certifications, energy modeling, writing reports, filling out forms, and selling equipment. In spite of the fact that this is ostensibly the Information Age, not the Estimation Age, more cities and states are making old-fashioned energy audits mandatory. They seem to be following the advice of the late management consultant Peter Drucker: “When a subject becomes obsolete, we make it a required course.”

Barriers to progress

Why don’t industrial plants have the information they need to operate all of their production and energy systems as efficiently as possible on an ongoing basis? The technology obviously exists. Just look at airplanes, automobiles, medicine, smartphones, and nearly every other sophisticated device or system other than buildings.

And yet those in the energy profession still don’t give clients the information they need. They still use temporary instrumentation, energy audits, and benchmarking to produce mountains of reports and justify capital projects.

One answer to why this occurs can be found in the Product Adoption Lifecycle (as can be found online at

Consumers, according to the Product Adoption Lifecycle, can be grouped into one of five categories:

1. Innovators – Interested in anything new, quick to adopt, and willing to pay a high price to be among the first to have a new product.

Our early iDOS systems incorporated the Apple II and Hayes modems shortly after they appeared on the market. We switched to the IBM PC when it was introduced. Starting with the Basic program language, we moved to Microsoft Windows and Excel in 1985. I was at the Microsoft conference in New Orleans in 1992 when Access was introduced. We immediately adopted it for data storage. In 2008, we switched from a PC-based to a cloud-based system utilizing the MySQL database.

2. Early adopters – Defined as young and restless, early adopters are opinion leaders. They were our first clients. We always referred to them as our champions.

3. Early majority – Value shoppers. Members of the early majority carefully observe the early adopters but wait to adopt innovative products until they are sure they will get value from them. They became clients only after visiting sites where iDOS had been in operation, talking to the owners, and viewing the results.

4. Late majority – As skeptics, members of the late majority wait until an innovation has been accepted by a majority of consumers before adopting it themselves.

We had few of these. Most skeptics wanted us to guarantee savings ahead of time. Many took the offer of utility companies who claimed they could provide the same information and service for free. However, the utilities didn’t have the same expertise or information.

5. Laggards – Traditionalists, laggards are the very last to adopt a new product. In my experience, this group largely describes the entire energy establishment, which has built a huge bureaucracy that is the source of all of its income and is content to use 40-year-old methods in working with clients.

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