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What is the best method to measure savings in energy efficiency projects?

Published on Dec 20, 2025
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One question that often persists in projects related to energy efficiency is 

“How to measure the savings?”

Because once a system is deployed, what you only get to know is the energy consumption with the system in place. It isn’t easy to interpret how much the consumption would be if the system were not in place, as there could be changes in weather, occupancy or operational usage.

Until IPMVP entered.

What is IPMVP?

The International Performance Measurement and Verification Protocol (IPMVP) provides an overview of best practices available for verifying results of energy efficiency, water efficiency, and renewable energy projects. It may also be used by facility operators to assess and improve facility performance.

IPMVP originated from a collaborative effort initiated by the U.S. Department of Energy in early 1994. 

Nearly 30 years ago, energy efficiency projects were smaller projects designed and defined in hundreds of different ways, resulting in multiple documentation and transaction costs. This meant higher costs for energy efficiency projects and a higher cost of financing them.

The goal of IPMVP was to develop an approach to measure and verify savings from energy efficiency investments, which was a barrier to the growing efficiency industry. The first North American protocol was published in 1996 with methodologies compiled by hundreds of industry experts primarily from the United States, Canada, and Mexico. The protocol was then internationalised in 1997 through the participation of national organisations from nearly 12 countries and individual experts from more than 20 countries. 

In 2001, IPMVP Inc. was established as an independent non-profit corporation to manage the protocol globally, and in 2004, it was renamed the Efficiency Valuation Organization (EVO), which is responsible for maintaining and updating IPMVP.

What does IPMVP do?

IPMVP today provides a framework that is used to:

  1. Verify whether a project has the potential to perform and save energy, and
  2. Quantify site-level energy and cost impacts from the project.

Both components are essential to the measurement and verification (M&V) of savings.

Energy, demand, water, greenhouse gas emissions, or other savings in a facility cannot be directly measured because savings represent the absence of energy/water consumption or demand. Instead, savings are determined by comparing measured energy consumption or demand before and after implementation of an energy efficiency measure (EEM), making suitable adjustments for changes in conditions. The comparison of before and after energy consumption or demand must be made consistently. The graph below is a depiction of the same.

Source: EVO World

And IPMVP also defined various approaches to determine the energy savings.


If the purpose of reporting is to verify the savings from equipment affected by the energy efficiency project, a measurement boundary should be drawn around that equipment, and measurement requirements for the equipment within the boundary can then be determined. Energy consumption and/or demand may be directly measured or determined by direct measurement of key variables that can be reliably used to calculate demand or energy consumption. The approach used is a Retrofit Isolation Option (Option A or B)

If the purpose of reporting is to verify and/or help manage total facility energy performance or verify the savings from multiple EEMs with interactive effects, the meters measuring the supply of energy to the whole facility can be used to assess performance and savings. The measurement boundary, in this case, encompasses the whole facility. The approach used is Option C: Whole Facility.

Source: EVO World

If the Baseline Period or Reporting Period data are unreliable or unavailable (e.g., new construction), energy data from a calibrated simulation model can be applied for either a portion or all of the facility. The measurement boundary can be drawn accordingly. The approach used is Option D: Calibrated Simulation.

ASHRAE Guideline 14 was published in 2002, making it a more recent development that builds upon and complements the IPMVP framework

While ASHRAE guideline 14 focuses specifically on technical engineering approaches, with four defined compliance paths for calculating energy and demand savings, as follows:

Source: ASHRAE Guideline 14–2002

Also, ASHRAE Guideline 14 prescribes a baseline model to determine the consumption or demand if the EEM were not implemented. Here’s how it prescribed the baseline model accommodating changes in weather, days, occupancy, solar irradiance and production capacity, to name a few.

Source: ASHRAE Guideline 14–2002

So, next time someone talks about energy or even water savings, you know how to verify it!

Please do visit us on the website for more information, and maybe tell your friends about it too. It will go a long way in keeping our energy and environment managed better.

Written by Zodhya

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