Within the domain of sustainable manufacturing, most of the ongoing research efforts, regarding reduction in energy consumption, are focused on manufacturing processes while a little effort is being made to make other production related efforts energy-efficient. This paper presents an analytical effort for saving energy in a machine shop environment by optimizing assignment of manufacturing processes to various machines and grouping machines in various cells for minimizing parts transportation distance. A nonlinear mathematical model is developed that seeks minimization of total energy consumed in machining various quantities of multiple parts and their transportation within the machine shop. An algorithm based on simulated annealing metaheuristic is developed for solution of the mathematical model. The model is then applied for energy based revamping of a machine shop, which deals in manufacturing of various quantities of multiple jobs. It is found from its application that significant levels of production and transportation energies can be saved by assigning the manufacturing operations to the most appropriate machines and optimally grouping the machines into machine cells, respectively. The paper contributes towards energy conservation by optimizing facility layout and production planning of a manufacturing setup. (C) 2018 Elsevier Ltd. All rights reserved.