Improving Industrial Energy Efficiency

6th Annual High-Performance Manufacturing

ConferenceCobourg, November, 2010

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Presentation Overview

Why Energy Efficiency• CME/NRCan benchmarking survey• Government of Canada GHG emissions policy• Prices?

Where to begin

The CIPEC Approach • 7 Steps to improving your energy management practices• Practical examples

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148 plants participated in the study between October 2008 to July 2009

8 86

16

0

26

15

2

26

18

23

Prim

ary

Met

al

Chem

ical

Pape

r

Non

-Met

allic

M

iner

al

Petr

oleu

m a

nd C

oal

Tran

spor

tatio

n Eq

uipm

ent &

M

achi

nery

Food

& B

ever

age

Min

ing

Fabr

icat

ed M

etal

Plas

tics

Oth

er M

fg.

CME/NRCan Survey

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Low implementation of technical best practices (TBPs)

Most plants have implemented 42 percent of TBPs

Small- and medium-sized plants have implemented almost 10 percent less TBPs than large plants

Technical best practices

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Low implementation of MBP in• Primary Metal manufacturing• Other manufacturing• Fabricated Metal manufacturing

Low implementation of management best practices (MBPs)

Higher implementation rates of MBPs were observed in:• Chemical• Non-metallic Mineral • Transportation and Machinery• Food and Beverage

Management Best Practices

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Report findings

Energy projects managed on an ad-hoc basis, while best practices not widely implemented.

Large plants have implemented, on average, close to 30 percent more MBPs than SMEs.

When a company follows management best practices, they generally will have a higher implementation rate for technical best practices.

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Report findingsIf all the remaining economically feasible best practices were implemented, total Ontario industrial energy use would decrease from 2007 levels by 29%

0

100

200

300

400

500

600

700

800

2007 2010 2015 2020 2025 2030

Tota

l Ene

rgy

Use

(PJ)

Milestone Year

Economic Potential Scenario

Reference Case

29%

Reference Case and Economic Potential Scenario energy use for all industry

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Source: NRTEE Getting to 2050

Climate Change Policy

0

40

80

120

160

200

240

280

320

2005 2010 2015 2020

Mt

Co

2e

Additional reduction

GHG Emissions for Industry

610 Mt – Canada’s GHG emissions target for 2020

240 Mt – the amount Canada plans to reduce GHG emissions by 2020

120 Mt – the amount of GHG emission reductions to come from the industrial sector by 2020

Under the Government of Canada revised Turning the Corner – a plan to reduce greenhouse gas emissions by 17% from 2005 levels by 2020.

Energy efficiency (EE) key to Canada achieving it’s climate change commitments!

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Rising Energy costs

The report, done for Canadian Manufacturers and Exporters (CME) projects electricity costs for business could jump by between 47.1 and 63.7 per cent by 2015.

- CME September, 2010

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Industry Challenges

Difficult to obtain company financing to implement EE projects. Too much effort to access assistance, funding and incentives. Lack of human resources to focus on energy management. Production is the dominant focus. Do not know where to find reputable energy service providers. Do not know how to identify and assess EE opportunities. Have limited knowledge of EE opportunities/products. Advanced EE products are not easily available.

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7 Steps to Good Energy Management

1. Get Involved 2. Assemble an Energy Team3. Train Staff4. Assess Energy Use5. Eliminate Waste - Maximize Efficiency6. Capital Projects7. Report and celebrate

Where To Start?

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An industry/government partnership to promote energy efficiency

cut operating costs improve productivity reduce GHG emissions and air

pollution

Canadian Industry Program for Energy Conservation

CIPEC1.

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Executive Board

CIPEC Leader Companies

Sector Task Forces & Sector Associations

Task Force Council

Natural Resources Canada supports CIPEC at all levels

CIPEC Structure

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CIPEC Portfolio

Tools• CanMost• Boiler Efficiency Calculator• Energy Savings Toolbox• RETScreen International

Training• D2$ Energy management workshops• Qualified specialists• Customized for companies and

associations

Incentives• ecoEnergy Retrofit• Industrial assessments• Pilot projects• Solar energy for heating• Tax incentives (Class 29, 43.1, 43.2)

Information•Industrial Sector Task Forces•Technical guide books•Employee Awareness•CIPEC.gc.ca web site•Heads Up CIPEC newsletter

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Choose an energy champion Select team members

• Plant engineer, maintenance staff, financial advisor

Meet regularly to develop and implement an energy management plan

NRCan employee awareness program• “Team Up for Energy Savings”

Assemble Energy Team2.

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Dollars to $ense Workshops

Spot the Energy Savings Opportunities Energy Monitoring and Tracking Energy Master Plan Energy Efficiency Financing

Energy Efficiency Training

NRCan covers 50% of the cost of a customized workshops tailored to companies and sectors

Training to Build Capacity

+

3.

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Assess Energy Use4.

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Waste and Efficiency

3. UnderstandWhen

4. UnderstandWhere

6. MaximizeEfficiency

5. EliminateWaste

7. OptimizeSupply

Find the Savings

Opportunities

2. CompareYourself

1. UnderstandCosts

UnderstandPresentUsage

1. From the point of Purchase

2. To the point of End-Use

3. And, back to the point of Purchase (or supply)

5.

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Checklist of Opportunities

HVAC Motors Fans and Pumps Fuel-Fired Equipment and Boilers Insulation Refrigeration Compressed Air Lighting Heat Recovery

20 20

Operating cost after energy

efficiency project

Energy & non-energy savings

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

1 2 3 4 5 6 7 8 9 10

Years

Annu

al O

pera

ting

Cost

Avoided Cost from EE project

Capital Projects

“Do nothing” operating cost

6.

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101 Bayswater Ave.

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Windows vs Furnace

ROI

New Furnace: $1,600 ÷ $4,500 = 37% ROI

Windows: $500 ÷ $15,000 = 3.3% ROI

Simple Payback

New Furnace: 2 years 10 months

Windows: 30 years

Which is the better economic decision?

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Report and celebrate

Pulp and paper company 85 employees $600,000 annual energy bill $200,000 lighting retrofit project $95,000 in direct incentives

• $37,000 ecoENERGY Retrofit Incentive• $58,000 from utility

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Savings: - $100,000 per year - ROI < 13 months

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ecoENERGY incentive

Auto Parts Manufacturer 70 employees $1 million+ annual energy bill $100,000 air compressor retrofit $30,000 in direct incentives

• $20,000 ecoENERGY Retrofit Incentive

• $10,000 utility

Savings: - $50,000 per year - ROI < 18 months

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ecoENERGY Incentive

Food & beverage plant 80 employees $370,000 annual energy bill $37,000 boiler retrofit project $9,000 ecoENERGY Retrofit

Incentive

Savings: - $21,000 per year - ROI < 16 months

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WhoWhat Creates Savings?

Source: Good Practice Guide 84 Managing and Motivating Staff to Save Energy

"...those of us who call ourselves energy analysts have made a mistake...we have analyzed energy. We should have analyzed human behavior." (Cherfas quoting Schipper in Science, 1991)

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Where to Start

Become a CIPEC Leader! Go to:

CIPEC.gc.caFor more information:

Richard JaneckyOffice of Energy EfficiencyNatural Resources CanadaTel: 613.992.3286Cel.: 613.808-4002E-mail: rjanecky@nrcan.gc.ca