In this paper, we propose to increase the efficiency of drilling rigs DR, through measurement, modeling, adjustment of DR. operation, and incorporating an energy storage flywheel system FW resulting in significant reductions in fuel consumption and pollutant emissions. In this regard, we propose to: a) Develop a full system model of all power producing and consuming machinery and process components in the DR and utilize some system measurements and a neural net based identification approach to best fit the model to test data. b) Utilize the model in (a) to investigate alternative operation modes for the drilling rig to reduce fuel consumption and the resulting air pollutants. The model will also guide integration of an energy storage flywheel FW system into the drilling rig to replace a diesel generator DG in order to operate the remaining DG's at more efficient power levels and yet still handle peak power events with the energy stored in the FW. The model will also be employed to simulate charging of the flywheel from the braking energy as a result of inserting (tripping) the drillstring DS into the hole, and the subsequent use of this renewable energy for powering circulation such as pumps, drawworks, lights.