Understanding The True Meaning Of Asset Sustainability
Posted by: Daniel Stouffer / Category: Climate ChangeWhat factors determine whether a particular asset is efficient or not within any given organization? Put it another way, what are the important metrics when it comes to assessing the viability of an asset and its return on investment? Traditionally, these factors are centered around performance based on specific purpose and the benchmarks used reflect manufacturer or industry expectations.
Asset sustainability is now becoming more widely recognized as an indicator of value. Companies understand how their activities may impact the people and environment all around them and are beginning to interpret the true meaning of corporate social responsibility. The company understands that it relies on natural resources to operate and that it must be a better steward of these resources.
How can a company minimize its exposure while at the same time trying to balance true profit potential? In the modern era this is going to be an increasingly difficult juggling act, especially as engaged stakeholders seem to have visibility into every action.
The concept of asset sustainability concerns the volume of energy that the company is responsible for buying and utilizing. The energy in turn creates greenhouse gas emissions and this is a source of great anxiety in our society in general. Energy, therefore, needs not only to be treated as a scarce commodity, but we also need to analyze the sustainability of each asset using this energy.
Typically, an asset is purchased for a particular purpose and its efficiency measured according to industry or product benchmarks. In short, the asset is termed to be operating efficiently and to purpose if it performs as measured by specific parameters. Very rarely is it measured according to its carbon output, or determined to be ultimately sustainable, or not.
Asset design and manufacture will in future be based on asset sustainability. This is a novel concept and dictates that actual efficiency may need to be less than ultimate efficiency, if it is determined that by going for the ultimate, the product will become environmentally unsustainable.
How do we determine asset sustainability? We need to monitor each piece of equipment to show its energy consumption statistics. Again, this is not undertaken by the majority of companies, many of whom are only beginning to realize how their energy-related carbon footprint can be controlled by electricity use. We will need to look behind the meter to monitor each asset and will then be able to compare against historical records.
We can no longer expect assets, once installed, to merely perform to expectations until they are replaced, but rather asset sustainability has more importance.
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