Evaluating Organizational Aspects

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4.3.1 Qualitative Evaluation

The usual method for evaluation is an energy and environmental management audit. It reviews the adequacy and effectiveness of the management structures, working relationships, utilization of personnel, adequacy of the lines of communication and clarity of company objectives related to the implementation of energy and environmental policy, if any.

Various tools are used in carrying out an energy and environmental management audit but the most common are interviews, questionnaires and reviews by checklists or an energy management matrix.

Some of these tools are provided in Toolbox III-1. The focus here is on the results that an energy and environmental management audit is expected to provide. It is possible to follow the steps in Figure 4.1 and use the questionnaires in Toolbox III-1 as a check list for a quick review in order to see which of the required structures, actions and procedures are fully or partially implemented and which ones are missing completely.

Box 4.1: Sample Scope of Work for Environmental Audit Required by Development Bank

1. Nature of the Project to be Supported

1.1 Description and Context of the Proposed Project

2. The Existing Company/Facility Conditions

2.1 Description of Processes, Facilities and Assets

2.2 Key Environmental, Health and Safety Aspects of the Company/Facility (if any)

2.3 Facility Location and Description of Natural Environment

2.4 Facility and Site History

3. Corporate Environmental, Health and Safety Management

3.1 EHS Policies and Practice

3.2 Organization of EHS Management

3.3 Contingency Planning and Emergency Procedures

3.4 Staff Training and Supervision

3.5 Internal and External Stakeholder Dialogue

4. Company's Environmental Performance

4.1 Local/National Regulatory Requirements

4.2 Applicable EU (World Bank/Other) Requirements and Standards

4.3 Inputs, Products and Releases

Raw Materials Source and Consumption (where appropriate)

Water Source and Consumption

Energy Source and Consumption

Greenhouse Gas Contribution

Intermediate Products Arising

Wastewaters/Effluent Amounts and Quality

Air Emission Amounts and Quality

Wastes Amounts and Characteristics

4.4 Process Efficiency

4.5 General Housekeeping Issues

4.6 Product-Related Issues

4.7 Material Handling and Storage

4.8 Hazardous Materials Management

4.9 Waste Management (inc. PCBs and Asbestos)

4.10 Soil, Surface and Groundwater Contamination

4.11 Current Environmental Expenditure

5. Health and Safety Performance

5.1 Local/National Regulatory Requirements

5.2 Applicable EU/International Requirements and Standards

5.3 Key Health & Safety Issues

5.4 Control of Major Accident Hazards

5.5 Current Health and Safety Monitoring Practice

5.6 Summary of Regulatory Compliance Status

5.7 Summary of Health and Safety Expenditure

6. Other Worker Related Issues

6.1 Forced Labor

6.2 Harmful Child Labor

6.3 Discriminatory Practices

7. Conclusions and Recommendations

7.1 Summary of Regulatory Compliance Status

7.2 Key Risks and Liabilities

7.3 Process Efficiency and Environmental Opportunities

7.4 Environmental Action Plan

Source: EBRD, http://www.ebrd.com/about/policies/enviro/procedur/procedur.pdf, Annex 3.

Table 4.1 Performance Measurement and Evaluation Review

Which performance aspects need to be monitored?

What related values are measured?

Why are they measured?

Is there any performance target?

What is the frequency of measurements?

Who measures?

Where is the source of data?

Who acts on data?

What do they do?

The key areas to be assessed are whether appropriate performance measurements are performed at all and secondly whether appropriate structures for performance evaluation are in place. These can be checked effectively if a simple table (Table 4.1) is completed for each performance aspect that has to be managed.

Such a table should be complemented by the assessment of the completeness of performance measurement systems. This requires determining whether all relevant performance indicators are measured, and if not, which ones are missing. This assessment should be done during the course of EEA.

A thorough analysis of organizational aspects related to the appropriateness of structures for energy and environmental management will reveal which aspects of the existing energy and environmental management organization require improvement. In short, improvements can be required in one or more of the following areas:

• top management commitment to energy and environmental performance improvement;

• a declared energy and environmental policy with clear objectives and targets;

• assigned responsibilities for energy and environmental performance;

• adequate levels of staff awareness, motivation and skills;

• an appropriate metering system for performance monitoring;

• a reporting and communication system for checking progress, providing feedback and communicating results.

How to implement the required improvements or set up management structures from scratch will be explained in the next chapter by elaborating upon the steps in Figure 4.1 and illustrating them by real case studies.

4.3.2 Quantitative Evaluation

In order to quantify the performance of current energy and environmental management practice, we need to use real data on production, energy and raw material consumption, emissions and waste. Further,

Production [t /m]

Figure 4.4 Sample Scatter Indicative on Energy Management Performance we need to prepare a scatter diagram in order to take a look at emerging data patterns, as elaborated in detail in Part I Chapter 3. Owing to variations of internal and external factors, the different values in the scatter diagram will not fall neatly on the 'best fit' line but will be spread above or below the line.

The extent of the scatter will indicate how strong or weak the current energy and environmental management practice is. A small scatter (less than 2 %-3 %) generally indicates good management practice, while larger values like 11.5 % that characterize the case study from Table 3.1 in Part I Chapter 3 (see Fig. 4.4) will indicate that there are significant opportunities for improvement.

However, scatter is only an approximate indicator of performance because it is possible to find small scatter values where, after analysis, performance may turn out to be quite bad. Typically, this may be the case when production output varies considerably while energy consumption remains almost constant. Statistically, scatter will be small, but actually this is a very wasteful operation, and energy management is weak or nonexistent.

The interpretation of the data pattern from a scatter diagram can indicate the performance of an existing management practice. Looking again at our tuna-canning case study, even though only monthly energy/production data are available, we are still able to identify a number of areas of concern that provide opportunities for performance improvement. Even if limited information is available, it can still be used to set the general direction for performance improvement across the business based on the qualitative assessment of energy and environmental management performance as shown before.

This can be summarized along the following lines:

(1) Production planning should be focused on avoiding large variations and low daily production output, thereby reducing the cost of energy and environmental compliance in the unit cost of products.

(2) Energy consumption in production should be tightly controlled so that it varies in accordance with production variations. This way, variable energy consumption can be reduced.

(3) Utilities should improve the efficiency of energy supply thereby contributing to the reduction of fixed energy consumption and environmental releases. It is worth mentioning that fixed energy consumption is not only caused by utility sections. It may be also the consequence of operational practice in production. For instance, if water or steam flows are controlled by overflow or bypass instead of by a stop valve, the energy consumption, as well as resulting environmental impacts, will be constant whatever the production activities are.

Such qualitative assessment is a useful first step in establishing the current position and giving the direction for performance improvement but it cannot provide proposals for specific technical measures for performance improvement. To obtain such proposals, we need to evaluate the ongoing operational practices in a factory.

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