Strategic Planning and Management Flashcards

Which strategic planning tool maps the relationship between organizational strengths, weaknesses, external opportunities, and threats relevant to energy management?

Answer: SWOT analysis

SWOT analysis helps energy managers assess internal capabilities and external market factors to develop strategies that leverage strengths and mitigate risks.

A city government wants to reduce municipal energy costs by 25% in 10 years. Which governance structure best supports this goal?

Answer: Establishing a cross-departmental energy steering committee with executive sponsorship

A cross-departmental steering committee with executive support ensures coordinated action, accountability, and sufficient authority to drive enterprise-wide energy goals.

Under ISO 50001:2018, what is the minimum required output of the strategic energy review process?

Answer: An updated list of energy performance indicators (EnPIs) and a confirmed energy baseline

ISO 50001:2018 requires the energy review to produce updated EnPIs and a verified energy baseline as the foundation for measuring improvement.

An energy manager proposes bundling several small energy projects into a single portfolio submission to management. The primary strategic advantage of this approach is:

Answer: Achieving a more favorable blended payback that offsets longer-payback projects with quick wins

Portfolio bundling allows high-ROI quick wins to offset less attractive projects, improving the overall business case and gaining approval for a broader program.

Which risk is most commonly associated with energy performance contracting (EPC) from the facility owner's perspective?

Answer: Savings not materializing as projected if the ESCO's guarantees are poorly structured

Poorly structured guarantee clauses, exclusions, or measurement disputes can result in savings shortfalls that leave the facility owner holding the financial risk.

An energy manager benchmarks their facility's energy use intensity (EUI) against ENERGY STAR data and finds it is in the 40th percentile. This means:

Answer: The facility is less efficient than 60% of similar buildings and has significant improvement potential

A 40th percentile EUI means 60% of comparable buildings perform better, indicating substantial room for improvement before reaching top quartile performance.

In strategic energy planning, sensitivity analysis is used to:

Answer: Assess how variations in key assumptions (energy prices, savings rates) affect project financial outcomes

Sensitivity analysis stress-tests financial models by varying key inputs (e.g., energy price escalation, realized savings percentage) to reveal which assumptions most affect project viability.