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Energy Cost per Unit

Energy consumption cost allocated to each unit produced — increasingly important for sustainability reporting and cost reduction.

Formula

(Total kWh × Cost per kWh) ÷ Units Produced

Benchmarks

World-class: Consistently reducing year on year Good: Below industry average Typical: At industry average Poor: Above industry average or unknown

What Is Energy Cost per Unit?

Energy Cost per Unit measures the energy expense allocated to each unit of production. With rising energy costs and increasing sustainability requirements, this metric is growing in importance for both cost reduction and ESG reporting.

The Formula

Energy Cost per Unit = Total Energy Cost ÷ Units Produced

Where Energy Cost = kWh consumed × cost per kWh.

Data Requirements

SourceRequiredWhat You Need
Machine DataYesProduction count; power consumption data (if available)
ExternalYesUtility bills, electricity rates, power meter readings

Energy Cost per Unit is a Phase 4 metric — it requires external utility data and ideally equipment-level power metering.

Why It Matters

  • Sustainability reporting — ESG metrics increasingly required by investors and customers
  • Cost reduction — energy is often the third-largest production cost after materials and labour
  • Equipment efficiency comparison — identifies which assets are energy-intensive relative to output
  • Idle running visibility — equipment running when not producing is pure energy waste

Best Practices

  • Install sub-meters for equipment-level energy tracking where feasible
  • Identify and eliminate idle running — equipment consuming energy without producing
  • Track by product type, since different products have different energy profiles
  • Implement energy efficiency projects starting with the highest-consumption equipment