CEM Strategic Planning and Management 5 — Questions and Answers
Question 1: Which strategic planning tool maps the relationship between organizational strengths, weaknesses, external opportunities, and threats relevant to energy management?
- Gantt chart
- SWOT analysis (Correct answer)
- Ishikawa (fishbone) diagram
- Monte Carlo simulation
Correct answer: SWOT analysis
SWOT analysis helps energy managers assess internal capabilities and external market factors to develop strategies that leverage strengths and mitigate risks.
Question 2: A city government wants to reduce municipal energy costs by 25% in 10 years. Which governance structure best supports this goal?
- Delegating energy decisions entirely to individual department heads
- Establishing a cross-departmental energy steering committee with executive sponsorship (Correct answer)
- Hiring a single energy analyst with no reporting authority
- Outsourcing all energy management to the lowest-bid utility consultant
Correct 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.
Question 3: Under ISO 50001:2018, what is the minimum required output of the strategic energy review process?
- A signed energy performance contract with an ESCO
- An updated list of energy performance indicators (EnPIs) and a confirmed energy baseline (Correct answer)
- A five-year capital expenditure forecast approved by the board
- A third-party energy audit report certified by a licensed engineer
Correct 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.
Question 4: An energy manager proposes bundling several small energy projects into a single portfolio submission to management. The primary strategic advantage of this approach is:
- Avoiding the need for individual project justifications
- Achieving a more favorable blended payback that offsets longer-payback projects with quick wins (Correct answer)
- Eliminating the need for measurement and verification after project completion
- Reducing the scope of ISO 50001 compliance requirements
Correct 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.
Question 5: Which risk is most commonly associated with energy performance contracting (EPC) from the facility owner's perspective?
- The ESCO failing to install the guaranteed equipment
- Savings not materializing as projected if the ESCO's guarantees are poorly structured (Correct answer)
- The utility increasing rates beyond the projections used in the contract
- Employees resisting the use of more efficient equipment
Correct 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.
Question 6: 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:
- The facility is more efficient than 40% of similar buildings
- The facility is less efficient than 60% of similar buildings and has significant improvement potential (Correct answer)
- The facility qualifies for ENERGY STAR certification
- The facility uses 40% less energy than the national median
Correct 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.
Question 7: In strategic energy planning, sensitivity analysis is used to:
- Measure how sensitive employees are to changes in workplace temperature settings
- Assess how variations in key assumptions (energy prices, savings rates) affect project financial outcomes (Correct answer)
- Determine the optimal thermostat setpoint for occupant comfort
- Calculate the sensitivity of metering equipment to electromagnetic interference
Correct 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.
CEM Strategic Planning and Management 5
Which strategic planning tool maps the relationship between organizational strengths, weaknesses, external opportunities, and threats relevant to energy management?