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How to Calculate Energy Efficiency

How to Calculate Energy Efficiency

Energy efficiency can help mitigate environmental impact and encourage businesses to promote modern energy consumption. As we strive for a greener future, understanding the importance of energy efficiency becomes essential. 

In fact, calculating your business’s energy efficiency offers not only ecological benefits but also promises substantial savings on your monthly bills. These positive changes can give you the knowledge required for making more informed choices.

Keep reading to learn how to calculate energy efficiency, along with the importance of this evaluation and how you can improve your renewable energy sources. 

What Is Energy Efficiency and Why Does It Matter?

In order to achieve energy efficiency, businesses must maximise their energy usage. Becoming more energy efficient means upgrading your operations, such as installing LED lighting or adding insulation. 

The Energy Efficiency Ratio (EER) measures a cooling system’s ability to operate when the outdoor temperature is optimal. On the other hand, the Coefficient of Performance (COP) determines the efficiency of heating systems, indicating the ratio of useful heat output to the amount of energy input.

Understanding energy efficiency requires businesses to make a conscious effort to optimise their energy usage. However, there is more to this process than simply evaluating how much energy you use. Reduced energy consumption means fewer greenhouse gas emissions, which leads to a lighter ecological footprint and a healthier planet.

In 2022, renewable energy sources accounted for 32% of Australia’s electricity generation. This number will continue to grow the more businesses use energy efficient practices. Renewable energy is key to reducing greenhouse gas emissions and protecting the environment. 

Overall, calculating your business’s energy efficiency can help you adopt more sustainable practices when building toward a greener future. 

Factors Affecting Energy Efficiency in Your Business

One of the primary factors affecting energy efficiency is your choice of appliances and equipment. Selecting appliances with high energy ratings or superior energy performance becomes a conscious step toward optimising efficiency. 

Australia has an Energy Rating Label that determines whether a product is efficient or not. Being part of the Australian and New Zealand Equipment Energy Efficiency (E3) Program, businesses can view specific products like swimming pool pumps and heating systems before investing in them. 

It’s not only about the appliances you choose but how you use them. User behaviour also plays a role in energy consumption, as habits like turning off your lights when not in use can significantly impact overall efficiency. You can use more awareness to transform your routine to enhance energy conservation.

Other factors include building design and insulation. Well-insulated structures and strategically designed spaces can mitigate energy loss, ensuring that the energy spent on heating or cooling isn’t wasteful. Investing more time into the construction phase can help your business become more energy efficient in the future. 

Educating businesses about energy-efficient practices creates a culture of responsibility. For example, awareness campaigns, training programs and readily available information empower consumers to make informed decisions. In turn, you can build an energy-conscious environment to reduce needless energy wastage.

6 Steps for Calculating Energy Efficiency

You can calculate energy efficiency through ratios like the Energy Efficiency Ratio (EER) or the Coefficient of Performance (COP). These formulas refine complex energy calculations into tangible values. This means that energy calculations quantify the efficiency of appliances, helping businesses make informed choices.

Below are steps for calculating energy efficiency: 

1. Understand the Basics

The Energy Efficiency Ratio (EER) and Coefficient of Performance (COP) formulas will be your measurement systems. EER is relevant for cooling systems, while COP is commonly used for heating systems

As daily energy users, understanding and employing these formulas not only aids in selecting energy-efficient devices but also empowers businesses to contribute to a more sustainable future. 

2. Identify the System Output and Input

Choose the appliance or system you want to evaluate. Whether it’s an air conditioner, refrigerator, or heating unit, each has its specific calculations.

For cooling systems, note the cooling output in British Thermal Units (BTUs) and the electrical input in watt-hours. You should identify the heating output and the corresponding energy input for heating systems. 

3. Apply the EER Formula for Cooling Systems

You can calculate the EER by dividing the cooling output (in British Thermal Units or BTUs) by the electrical input (in watt-hours). The higher the EER, the more efficient the installed cooling system. 

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4. Use the COP Formula for Heating Systems

Businesses frequently employ COP in assessing heating systems. This ratio compares the heating output to the electrical or other input energy. A COP greater than 1 indicates a more energy-efficient heating system.

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5. Interpret the Results

The calculated ratios provide a representation of your business’s energy efficiency. Higher values signify better efficiency, suggesting that the system produces more output for the energy you consume. This step helps you make informed decisions when selecting or comparing appliances.

6. Compare and Make Informed Choices

Now that you have these calculations, you can compare the EER or COP values of different appliances. Opt for systems with higher ratios to ensure energy-efficient choices for your business’s cooling and heating needs. 

By understanding and applying these calculations, you can contribute to a greener and more energy-conscious environment. One where your choices align with a sustainable and eco-friendly future.

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Tips for Improving Energy Efficiency

You can enhance your business’s energy efficiency through various actionable steps. Considering these practical tips can be your roadmap to a more energy-conscious and cost-effective business lifestyle.

Below are ways you can improve energy efficiency: 

Upgrade to Energy-Efficient Appliances

When it’s time to replace old appliances, opt for models with a high energy rating. There are strict guidelines for the energy efficiency of these appliances. This ensures optimal performance with minimal energy consumption. 

You could choose solar panels or heating and cooling systems that can improve your thermal comfort.

Unplug and Power Down

An important portion of energy consumption comes from standby power. Therefore, you should unplug chargers and turn off electronics and machines when not in use, as this can prevent unnecessary energy drainage. 

Harness Natural Light

Take advantage of natural light during the day by opening curtains and blinds in the office. This habit reduces the need for artificial lighting, cutting down on electricity consumption. Natural sunlight can also charge solar panels and reduce your long-term energy costs.

Optimise Water Heater Settings

Lower the temperature setting on your water heater to around 120°F (49°C) to improve your business’s energy efficiency. This change not only prevents scalding but also reduces energy expenditure.

You should also keep your appliances and HVAC systems in top shape through regular maintenance. Clean water filters, well-lubricated components and maintained systems operate more efficiently.


Your business should embrace energy efficiency as a conscious decision. This awareness shows your commitment to a sustainable and economical future. From understanding renewable energy to calculating ratios and implementing practical tips, each step will encourage you to make a difference.

Contact Ecosaver today to learn more about energy efficiency and how it works. Our experts can help your business stand out in the renewable energy industry and invest in modern smart building technologies.

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