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Energy Budgets at Risk (EBaR)

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Energy Budgets at Risk (EBaR)

A Risk Management Approach to Energy Purchase and Efficiency Choices (Wiley Finance)

Wiley,

15 min read
10 take-aways
Audio & text

What's inside?

Energy costs are many companies’ biggest – and volatile - expense; now, a new method helps you manage this large exposure to risk.

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Editorial Rating

7

Qualities

  • Innovative
  • Applicable

Recommendation

Since the first oil embargo in 1973, energy prices have increased and become more volatile, creating the corporate need for better financial tools to evaluate energy costs. Enter energy economist Jerry Jackson, developer of the "Energy Budgets at Risk” (EBaR) analysis that technically oriented managers can use to make sharper decisions about how and when to upgrade systems to achieve energy efficiency. EBaR is a trademarked cost and risk analysis tool, and Jackson explains it (and, in truth, promotes it) clearly. Although his book is a bit repetitive and loosely organized, it contains all the formulas, graphs and rationales needed to explain EBaR’s statistical approach. getAbstract recommends this to math-minded managers who seek new ways to assess and control their organizations’ energy costs – and to help the planet along the way.

Summary

More Volts for the Buck

Managers who use Energy Budgets at Risk (EBaR) analysis techniques can cut their facility’s annual energy costs from 20% to 30%, thus increasing their cash flow. EBaR helps managers quantify the risk of investing in upgraded, modified or redesigned energy-efficient systems. It is an innovative structure for assessing and enumerating the risk inherent in energy costs. Organizations can use it to lower their power costs, to evaluate the purchase of new energy-efficient technology or to weigh the decision to redesign or improve existing energy-use systems.

Energy expenses are one of the two most significant costs businesses face (the other is health care). EBaR is meaningful as a comprehensive quantitative way to analyze energy investments and purchases in the same kind of detail that you exercise in evaluating other investments. It uses risk management tools developed and polished in the financial-services sector. Properly applied, this approach can reduce costs, increase cash flow, meet your company’s risk tolerance needs and boost your bottom line.

EBaR is especially critical as rising costs, green energy initiatives and the quest to develop...

About the Author

Jerry Jackson is an energy economist, consultant and Texas A&M professor with 30 years of experience in developing and applying practical solutions to difficult energy industry problems. He has worked with more than 20 Fortune 500 companies, as well as start-ups, utilities, state agencies, research labs and the U.S. Department of Energy.

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