Manufacturerwww.ima-net.org Fall 2016

THE ILLINOIS

VFDs CAN SIGNIFICANTLY LOWER ENERGY COSTS

Managing your energy strategyall year round

mHUB is Chicago’s first manufacturing innovation center — opening in JanuaryWhat every manufacturer should know about TSCA reform

16Managing your energy strategy all year round

Mission StatementThe object for which the IllinoisManufacturers’ Association wasformed is to strengthen the eco-nomic, social, environmental andgovernmental conditions for manu-facturing and allied enterprises inthe state of Illinois, resulting in an enlarged business base andincreased employment.

ChairmanWilliam M. Hickey, Jr.

PresidentGregory W. Baise

EditorStefany J. Henson

The Illinois Manufacturer is publishedquarterly by the Illinois Manufac -turers’ Association. All rightsreserved. The title, The IllinoisManufacturer, is a trademark of theIllinois Manufacturers’ Association.

Copyright 2016© IllinoisManufacturers’ Association.Reproduction of all or any part isprohibited except by written permis-sion of the publisher. Published arti-cles do not necessarily reflect theviews of the magazine or its pub-lisher. Information in this publica-tion should not be substituted foradvice of competent legal counsel.

For address changes and adjust-ments, write to The IllinoisManufacturer. Presort standardpostage paid at Bloomington, IL.Postmaster: Send address changesto The Illinois Manufacturer, 220East Adams Street, Springfield, IL62701. Telephone: 217-522-1240.

If you have any questions, please contact Stefany Henson,Editor and Director of Publicationsat 217-718-4207, or email shenson@ima-net.org.

Fall 2016

Share your company newswith IMA . . . News information, press re leases and articles may besent to Stefany Henson, Editor and Director ofPublications, Illi nois Manu facturers’ Associa tion(IMA), 220 East Adams Street,Springfield, IL 62701, oremail: shenson@ima-net.org.

ColumnsPresident’s Report: Restructuring and competition have had a suppressing effect on Illinois energy prices, though our robust generation mix has also played a vital role ................................................................................... Page 4

Legislative Report: Why join the IMA? It’s very simple — there is no other association in Illinois fighting for manufacturers’ interests every single day ...................................................................................... Page 6

Management Strategies: Budget for success: With Q4 2016 underway, it’s time to think about 2017 — by Adam Hackman, MIS of Illinois ................ Page 9

Energy & Environment: Four reasons investment and natural gas strategies work the same way — by Constellation ...................................... Page 13

Legal Issues: What every manufacturer should know about TSCA reform — by William J. Walsh, Clark Hill PLC ..................................... Page 15

Government Initiatives: Intersect Illinois seeks to position the state at the forefront of 21st-Century manufacturing — by Jim Schultz, Chairman and CEO of Intersect Illinois ...................................................... Page 19

Tax & Accounting Issues: Five features of tax deductions for energy efficient manufacturing buildings by Daniel Hurtado, RSM ................. Page 21

IMA Member News ................................................................................ Page 28

New IMA Members: Welcome! ................................................................. Page 30

IMA Calendar of Events ......................................................................... Page 30

Water Resource Recovery: The unique partnership of two industry leaders — by Bruce Hauk and Debra Shore, Illinois American Water ......................................................... 7

Variable Frequency Drives can significantly lower energy costs — by Richard Reese, CEM, CEA, Ameren Illinois Energy Efficiency Program .................................... 11

mHUB is Chicago’s first manufacturing innovation center —opening in January — by Dan Naumovich ................................... 22

Understanding the range of factors that influence energy prices can be a time-consuming and confusing process. Constellation, the IMA’s endorsed energyprovider, has various market intelligence publications available to keep you informed.

The Illinois Manufacturer is underwritten by Constellation — an Exelon Company

7

American manufacturing is at acrossroads. Foreign competi-tion, rising operational costs,

and the search for a qualified work-force are enough to keep any manu-facturer awake at night. However,partnerships between private andpublic organizations with visionaryand proactive strategies can offerU.S. manufacturers a competitiveadvantage.Manufacturing is vital to the

country’s economy, but it can leavebehind a big environmental foot-print. The opportunity for compa-nies to save money through environ-mental stewardship has often beenconsidered an elusive, if not entirelyunattainable, “win-win” scenario. But when it comes to water, all

that is changing.Most manufacturers in the United

States are paying full-price to usehigh-quality drinking water forprocesses that do not necessarilyrequire potable water. It’s an expen-sive and ultimately wasteful practice.Fortunately, an affordable, safe, andpractical alternative to potable watercan be found in municipal effluent— that is, treated wastewater fromhomes, businesses, and industries.As leaders in the water industry,

Illinois American Water (IAW) haspartnered with the MetropolitanWater Reclamation District of GreaterChicago (MWRD) on an innovativeeffluent reuse project. This public-private partnership will offset manu-facturers’ operational expenses bysupplying companies with low-costtreated effluent, also known as recy-cled water. Properly recycled watermeets health and safety standardsrequired for the vast majority ofindustrial uses, such as fabricating,processing, washing, diluting, cool-ing, and transporting. This partnership will explore

opportunities for industrial reuse ofeffluent water from MWRD’s CalumetPlant, which treats approximately 237million gallons of wastewater per daywhile eliminating 90 percent of con-taminants. IAW will build and main-tain the necessary infrastructure to

deliver the recycled water to industri-al users while MWRD continues toprocess and treat wastewater. Once-used recycled water will be conveyedback to MWRD for another round oftreatment and subsequent reuse.As both a member of the Illinois

Manufacturers’ Association (IMA) anda steward of our natural environ-ment, IAW shares a common interestin helping preserve, protect andenhance manufacturing operationswhile also advancing sustainablewater solutions throughout theChicago area. A growing percentageof the U.S. population recognizes theimportance of water stewardship andexpects companies to adopt greenerpractices, yet day-to-day industrialoperations are often inherently waterintensive. Recycled water provides anopportunity for manufacturers witheven the largest water footprint tobecome environmental champions. The idea that saving money and

saving water are on opposite ends ofthe spectrum is an outdated way ofthinking, long past its sell-by date.Instead MWRD and IAW are seekingto capture the economic value inwhat was once considered waste.Recycled water is an affordable andrealistic alternative for manufacturers

currently paying full-price for potablewater. It’s good for the planet andgood for the bottom line.

Illinois American WaterIAW serves approximately 1.2

million people in 127 communitiesacross the state of Illinois, providinghigh-quality water and wastewaterservice. IAW is a regulated utilitygoverned by the Illinois CommerceCommission. The company opera-tions follow strict regulations createdby the United States EnvironmentalProtection Agency (USEPA) that helpto provide high quality drinkingwater.IAW’s parent-company, American

Water, was founded in 1886 andtoday is the largest and most geo-graphically diverse publicly tradedU.S. water and wastewater utilitycompany. With headquarters inVoorhees, New Jersey, the companyemploys 6,700 dedicated profession-als who provide regulated and mar-

see WATER page 14

WATER RESOURCE RECOVERYThe unique partnership of two industry leaders

by Bruce Hauk, President, Illinois American Water and Debra Shore, Commissioner, Metropolitan Water Reclamation District of Greater Chicago

Metropolitan Water Reclamation District of Greater Chicago’s Calumet Plant

14

damper to control the flow of liquidsor gases. The VFD allows the motorto speed up or slow down to providethe necessary pressure — eliminatingthe need for dampers and valves. The sheer size of some of those

motors made the Aventine projectunique. “It’s not common to install VFDs

on 400 horsepower motors,” saysSchultz. “Those are some very, verybig dogs — but the bigger themotor, the bigger the savings.” In fact, by modifying just 12

motors, Aventine has reduced itsannual electrical use by more than 4.2million kilowatt-hours a year. Thoseenergy savings boost the bottom lineby nearly $300,000 every year — andhelp the environment, too.To help fund the improvements,

Ameren Illinois provided more than$170,000. The incentive money cutAventine’s project costs by morethan half. And because Aventine haslimited funds for capital projects,receiving incentives through AmerenIllinois helped push the project tothe forefront. The project proved to be a wake-

up call to the power of energy effi-

ciency. With an eye for energy effi-ciency, the team at Aventine hopes totransform their workplace — original-ly built in 1899 as a sugar processingfacility — one project at a time.

Resources available for VFD projectsThe Ameren Illinois Energy

Efficiency Business Program has anumber of valuable resourcesdesigned to help with your VFDenergy efficiency project. The pro-

gram offers free energy consulta-tions, which can help identify thebest applications for a VFD anddetail how to secure cash incen-tives to offset project costs. For alimited time, Ameren Illinois canprovide businesses with a cashincentive of $115 per horsepowercontrolled for motors of 500 horse-power or less, which could cover

up to 75 percent of the projectcost. The program also offers $0.06per kWh saved for VFD installa-tions on motors larger than 500horsepower. Your facility may alsobe eligible for an additional incen-tive bonus when you completeyour project before March 31, 2017.To schedule an energy consulta-

tion or inquire more about VFDs,please call us at 866-800-0747. Youcan also get more information atActOnEnergy.com/VFD.

About the Ameren Illinois EnergyEfficiency ProgramSince 2008, the award-winning

Ameren Illinois Energy EfficiencyProgram has helped Illinois busi-nesses save over $360 million inenergy costs. Utilizing more than$85 million in cash incentives, busi-ness customers have been able tocut project costs, decrease paybackperiods, and move energy efficiencyprojects forward. n

References1. U.S. Department of Energy (DOE).

Variable Speed Pumping: A Guide toSuccessful Applications. May 2004.

Visit ActOnEnergy.com/VFD or call866-800-0747 for more information.

ENERGY COSTSCont. from page 12

ket-based drinking water, waste-water and other related services toan estimated 15 million people in 47states and Ontario, Canada.

Metropolitan Water ReclamationDistrict of Greater Chicago The MWRD’s mission is to protect

the health and safety of the publicin its service area, protect the qualityof the water supply source (LakeMichigan), improve the quality ofwater in watercourses in its service

area, protect businesses and homesfrom flood damages, and managewater as a vital resource for its serv-ice area. MWRD’s strategic plan

includes a goal to pursue resourcerecovery, including reuse applica-tions for treated wastewater. n

WATERCont. from page 7

For a limited time, AmerenIllinois can provide businesseswith a cash incentive of $115 per horsepower controlled for motors of 500 horsepower or less . . .

Metropolitan Water Reclamation District of Greater Chicago’s Calumet Plant