It’s a phenomenon well-known to car shoppers. They buy a brand-new car for what appears to be a great value. As they motor around town, they realize it’s not all they had hoped for: the horsepower lags, it guzzles gas, and the suspension is shot – they feel every bump in the road. Their four-wheeled investment has turned into a four-star disappointment.
Take that realization and multiply it exponentially. That’s the pain executives can experience when a new, long-anticipated industrial plant delivers higher energy costs than expected. It can be a nightmare when, right out of the gate, a new facility’s production cost is higher than those of its competitors and peers.
What just happened here? Why is profitability not up to par? All the building blocks were in place: Trusted engineering firms completed the design using modern methods and equipment, and construction was completed near budget and scheduled targets.
As you drill down, you may realize that energy costs were not prioritized like they could have been. Waste in energy conversion, distribution, and use directly impacts profitability — and minimizing it is one of industry’s biggest opportunities to enhance bottom lines.
How Energy Costs Can Sabotage Your Profitability
“Energy costs can be easy to overlook, with initial budgeting most often focused on upfront costs,” said Robert Sabin, consulting engineer at Emerson Process Management. “But it’s the ongoing nature of wasted energy costs that can be a major drain on your profitability.”
Waste is rampant. Consider a 2012 study for the United States Department of Energy, which found that 37 percent of energy that comes into industrial sites is lost. Additionally, a United Nations study found that industrial operations in developed countries could improve energy performance by 5 to 30 percent.
Why These Costs are Overlooked – and How to Address ThemHere are three reasons we often hear that explain why energy efficiency can be overlooked:rn
- “We need to limit capital costs.” In reality, optimal energy performance can often be built
- “No one mentioned it.” Engineering, procurement and construction (EPC) companies often have no incentive to consider new designs or technology that will minimize energy operating costs.
- “It’s the way we’ve always done it.” Technology improves constantly, and leaders can drive plant designers to harness those new capabilities.
The Stealth Competitive Advantage: Improved Energy Performance for Little or No Added Cost
Ready to take control? These five best practices can help business leaders build Top Quartile Performance into their next capital project:
1. Consider the whole as much as the parts.
“Much of the focus on energy improvement centers on the efficiency of discrete equipment, such as motors, heaters, and boilers,” Sabin said. “While this is important, what is potentially even more valuable in terms of saving energy is coordinating groups of equipment, processes, and operating areas. Deploying automated processes and technologies will play a crucial role in this coordination effort for maximum payback.”
2. Check into the latest tech.
Technology that would optimize energy performance in capital projects is often either underutilized or left out altogether. For example, for the past 60 years, the approach to combustion control has typically been based on fuel-to-air curves — the ratio of air to fuel in a combustion process. Today’s technology allows control using math calculations that eliminate the wasteful “cushion” that comes with curves. Other tools now available include wireless energy measurements, real-time monitoring for leaks and venting, adaptive combustion control, and automatic coordination strategies.
3. See the forest for the trees.
We like to say that granularity is real vision. Traditionally, new processes, plants, and mills have been built with only the instrumentation that is required to run the operation. But to effectively monitor and drive energy efficiency, operations teams need a granular picture of energy use that can only be provided by measuring all significant energy flows. These technologies are relatively inexpensive to install when a process is first designed and built.
4. Don’t overlook — or accept — the “little things.”
A bit of venting here, some steam leaks there. Each of these many factors — among the most common and obvious energy losses at a typical industrial site — are small on their own, but add up to big losses.
“New processes should be installed with real-time monitoring of significant potential leak points so that maintenance will know immediately when energy waste starts so they can stop it before it grows,” Sabin said.
5. Consider that reliability is key for efficiency.
Plant reliability and energy efficiency go hand-in-hand. New tools have emerged in recent years to monitor equipment and processes so that failures that will impact reliability can be seen and addressed before unplanned outages occur. Real-time alerts of impending issues allows orderly shut-down or alternate operating scenarios that mitigate losses. Proper training can help ensure that your staff is making the most of these tools.
As executives consider the priorities of safety, quality, and reliability during the construction planning process, they often overlook optimizing the design for energy efficiency. That’s a mistake since it is more cost-effective and easier to deploy solutions when capital projects are first conceived and during the early design.
“Well-conceived energy management and monitoring tools and procedures can help operations personnel achieve Top Quartile Performance in their industry by automatically incorporating energy use into process control at the outset and delivering real-time alerts on an ongoing basis when targets are missed,” said Sabin. “This combination will yield a plant that’s energy-efficient today – and every day.”
For additional articles related to Emerson’s energy consultant Robert Sabin, visit the Emerson Process Experts blog.