Energy Savings in Industrial Processes: The Influence of Electricity Emission Factor and Financial Parameters on the Evaluation of Long-Term Economics and Carbon Savings

The assessment of energy savings is not a trivial matter, as we have direct meters for consumption, but not for the absence of consumption. Calculating a simple difference between consumption before and after the implementation of an energy saving measure is also an incomplete assessment. The only way to determine energy savings is to compare the consumption that would have occurred in the absence of the saving measure with the actual consumption, with reference to the same external conditions and the same period. This is what the international IPMVP® protocol establishes. This study, based on two case studies of industrial energy saving measures, explores the aspects of the calculation related to decarbonization and economic evaluation. In particular, sensitivity analyses of energy and economic indicators are carried out based on factors that evolve over time, such as the rate of inflation and discounting of investments and the variation in the carbon dioxide emission factor for electricity production. The main results highlight that the assumption of a constant electricity emission factor leads to an overestimation of the total CO2 savings from energy efficiency interventions that can be more than 40%. The uniqueness of this paper is the application of a standardized savings evaluation procedure (IPMVP®) in order to analyze the sensitivity of economic savings towards some key financial parameters, and the specific fitting of an electricity emission model to the Italian power sector in order to correct the carbon savings evaluation to the projected emission factor evolution.