Asset Procurement: What Sets Smart Organizations Apart from the Rest

The Chinese government is expected to be proactive in ensuring that it will be able to achieve its emissions reduction and energy efficiency targets. It is also about time that the Western world should have a look at what China is doing. The Chinese government took the center stage at the Summit in Copenhagen where it pioneered in taking initiatives towards a comprehensive greenhouse gas emissions reduction. At this point in time, China is making sure that it is "getting there".

The Chinese government has just announced that any new, fixed asset procurement initiatives must first pass stringent, energy-saving assessments. As such, all new investments must be first assessed by independent institutions, before being rubberstamped by government regulators. Each asset will be viewed on its merits based on its energy consumption and ultimate efficiency.

Maybe the Western world should take a leaf out of the book of the Chinese regulators, who seem to be taking very proactive steps to ensure that that country achieves its projected energy efficiency and emissions reduction projections. China took the center stage at the Copenhagen Summit, where it was the very first to take a step forward to comprehensive GHG reduction initiatives. They now appear to be taking steps to ensure that they "get there."

The new laws, nationwide, come into effect on November 1 of 2010. Asset procurement will not only be regulated this way, but every equipment will be monitored to make sure that it achieves its target energy consumption. The regulations further stipulate that the more energy that an individual asset uses, the more detailed an energy-saving report must be compiled.

China is still undergoing a very rapid industrial expansion. Regulators understand that asset procurement is an integral part of this expansion and, as they fully intend to meet their energy and emissions goals, they are initiating these far-reaching asset procurement restrictions.

As energy consumption per unit of gross domestic product was far short of its annual targets in 2009, the new Chinese rules are a way of accelerating efficiencies in order for the government to meet their lofty goals. In a statement, the Chinese National Development and Reform Commission said that "it is very important and urgent for us to curb excessive growth of energy consumption and create energy use efficiency."

Of course it is far from likely that such regulations governing asset procurement will be introduced in Western economies, but individual organizations should nevertheless approach the issue from the same perspective. All items of equipment should be assessed using energy efficiency as a prime metric. This could help ensure that the raw cost of energy will be constrained as long as possible, and that GHG emissions are also curtailed.

When individual assets are measured to determine their energy efficiency, ultimate performance can be revealed. If energy use levels fluctuate from the baseline, or norm, potential problems can be anticipated and preventative maintenance engaged. This can only help to improve uptime and productivity as well.

Should new rules set by the Chinese government become effective, China will increase its competitive stance in the worldwide market. This helps in the motivation of other organizations across the globe, to make sure that energy use is reduced when possible. Asset procurement is now seen in a totally different light.