By Zac Bloom, Vice President, Head of Sustainability and Renewables
An Energy Master Planning exercise can be undertaken for a multitude of reasons and at a variety of levels. Establishing a clear intent for the plan is essential to making the most of the time and money invested in the plan. If done correctly, it should do more than diagnose today’s problems. While the future is uncertain, a good plan should provide you with a blueprint of what to build, when, and why based on your goals, constraints, and today’s energy landscape. Is your purpose scenario-planning to test electrification and fuel-switching pathways against rate design and grid constraints? Is it cost estimation to turn ideas into project budgets with realistic outage windows and interconnection timelines? Is it an audit of whether you can meet carbon goals given a particular Renewable Energy Credits (REC), demand management, and load-shaping strategy? Or is it a blueprint you can phase over time through your capital-planning stage gates?
This guide argues that in many cases it should be a combination of all of the above: a build-ready plan that integrates engineering, utility rate design and policy forecasts, and hard construction estimates so that leadership can approve, fund, and deliver projects instead of filing another study on the shelf. In this post we have tried to identify the key components of creating an actionable plan, and seven key decision points to consider when embarking on an energy master planning initiative.
Turning Plans into Projects
Turning plans into projects requires a disciplined operating model that runs in a loop: Discover → Decide → Fund → Build → Verify → Re-forecast. It is also important to integrate work with scheduled renovations and new construction to the maximum extent possible so electrification projects and envelop upgrades ride existing budgets and outage windows, reducing net capital expenditures and downtime. Construction timelines and investments must also do their best to align REC and carbon accounting impacts with public goals and reporting frameworks.
A good Energy Master Plan doesn’t end with a binder—it begins a build program. If you use the six decisions laid out in this blog post, staff the work like a project, and tie scenarios to rate design, incentives, and capital planning, you get a living roadmap that retires old infrastructure, sequences new systems, and withstands real-world constraints. Re-forecast it annually, measure success in projects built, dollars saved, and emissions reduced.
The teams that develop and implement Energy Master Plans are more project teams than report committees. Plans often require valuable input and buy-in from a wide range of stakeholders:
· Finance/CFO to define capital structure and target hurdle rates.
· Facilities & Operations to align standard operating procedures and construction guidelines, and outage windows.
· Capital Planning/Design to orient the construction and renovation roadmap.
· Sustainability teams to ensure renewable and decarbonization goals can be met.
· Information Technology to review building management systems and data needs.
· Communications/Human Resources to drive change management.
These internal stakeholders must be coordinated alongside the external specialists: mechanical engineers to model loads and electrification; utility rate design analysts to navigate demand charge structures and time of use rates; market and regulatory forecasters, renewable energy and carbon accounting experts to validate; cost estimators to design estimates and schedules; and an owner’s project representative to keep scope, budget, and timelines on track.
The Six Key Decisions for Every Energy Master Plan
- Ambition & Guardrails. Targets (net‑zero, emissions intensity, local or state goals), risk appetite (commodity exposure, REC strategy), siting constraints, operational requirements.
- Data & Baseline. Energy consumption and interval data, bills, utility rate design, asset inventory and replacement dates, occupancy and production schedules, Scope 1 and 2 boundaries, account meters and sub‑meters.
- Scenario Design. BAU (Business as usual) vs. alternative scenarios incorporating efficiency + controls, electrification (space heat, Domestic Hot Water, process), on‑site generation & storage, off‑site procurement (Power Purchase Agreements/RECs), fleet conversion, demand response/load curtailment.
- Economics That Survive Reality. CapEx (capital expenditures) and OpEx (operational expenditures) expectations based on escalation and inflationary assumptions, incentives, tax treatment, rate design ‑forecasts, back up generation requirements, interconnection costs and upgrades. Establishing Net Present Value/ Internal Rate of Return (IRR)/Payback requirements and goals help to quickly home in on the most financially realistic solutions. Key sensitivities: energy prices, labor, materials, carbon price, interconnection timelines.
- Policy & Incentives. Map current/future rules, state and federal incentives and funding, and safe‑harbor timelines. Define REC/Emissions Factors treatment for claims and disclosures. Note local building performance standards and ordinances.
- Delivery & Governance. Consider portfolio sequencing, outage windows, commissioning, and measurement and verification using key performance indicators established upfront in order to make sure the Plan meets expectations.
CES: Helping Clients Develop Energy Master Plans
Over the years, Competitive Energy Services (CES) has helped several of our clients develop Energy Master Plans. Developing an effective Energy Master Plan requires sound mechanical engineering team and construction estimators, but also a comprehensive understanding of energy markets, policy, and technology trends, which CES can provide.
Our deep energy expertise helps end users evaluate such questions as what the best contracting mechanism is for energy and/or environmental attributes, whether it makes sense to deploy renewable electricity generation located onsite behind-the-meter or offsite, how state and federal policy and incentive programs can impact the economics of renewable energy and alternative fuels, how changes in the grid supply mix and end user’s usage patterns will impact electricity pricing and rate design, and how emissions mitigation policy may impact natural gas economics and transportation reliability as the gas system is phased out, to name a few examples. Our prior experience also helps us guide our clients as an owners agent, to avoid common pitfalls and focus on a practical planning approach.
CES provides energy users a range of services to help navigate the full Energy Master Plan development process, depending on client’s specific case and needs. Our 25+ years of experience advising energy users how to purchase energy, navigate wholesale and/or retail energy markets, and evaluating new project opportunities gives us a unique perspective and approach to long-term strategic planning. To discuss your energy master plans in more detail, please contact Zac Bloom, Vice President, Head of Sustainability and Renewables at zbloom@competitive-energy.com.
Photo by: TU IS