Can Manufacturers Maximise Energy Efficiency Through Operational Excellence Alone?

The notion of operational excellence in manufacturing has been around for decades. Manufacturing managers face extreme challenges as they try to balance a range of often conflicting objectives. These include producing product reliably, meeting quality standards, operating safely, minimising costs, maintaining a heathy, motivated and skilled workforce, social objectives and now environmental objectives.

In trying to deal with these challenges, the search has been on for the silver bullet that would make all of this possible. This spawned a family of approaches, evolving from Quality Circles to TPM to World Class Manufacturing to Lean to Six Sigma and to various hybrid approaches, such as so-called “Lean Sigma” for example. What I’d like to answer through this post is whether use of such approaches can be successfully applied to energy efficiency, and whether they are enough to deliver optimal energy efficiency performance on manufacturing sites.

There are a few common threads with all of the approaches to operational excellence in manufacturing. These are as follows:

Measure performance outcomes – this can be achieved through approaches such as visual management, and includes systems, many of which involve data acquisition and are becoming increasingly web-based
Measure and control performance inputs – the philosophy here is that by controlling processes closely, the desired outcomes will be achieved
Standardise work practices – everyone should complete tasks in the same way, and each task should be improved continuously over time
Communicate results widely – this is a participative management principle which underscores that everyone can contribute to improved performance
Solve problems formally – the focus is on continuous improvement, with the results achieved used as feedback for use in future problem solving events. Problem solving is also conducted in a participative manner
Integrate performance measurement and management as far as possible – the interrelationships between various performance outcomes is understood and an optimum is sought between various performance indicators rather than a maximum for each one. Some cost savings may need to be foregone to achieve specific quality objectives, for example.
Focus on the customer – by meeting customer requirements (both internally and externally) waste associated with spurious objectives is eliminated

Without embarking on an organisation-wide “change programme”, I can assure you that if you simply incorporate the above principles into how you manage your manufacturing operations, you will improve performance levels. But are such approaches enough to maximise energy efficiency potential?

Energy efficiency is undoubtedly an “operational excellence” issue. Reducing energy consumption reduces costs, and this is often the biggest driver for the pursuit of energy efficiency. Equipment that is well-maintained tends to consume less energy. Maintaining high quality levels and reducing rework has a positive effect on energy efficiency. These are just some examples to show that energy efficiency is already intertwined with all of your other operational objectives. There are many energy efficiency issues that are under the direct control of plant operators – air and steam leaks are a simple example, as are simple tasks such as switching off equipment and lighting that are not required. It is therefore straightforward to integrate such energy efficiency tasks into philosophies such as TPM, which encourages autonomous maintenance. While energy efficiency practitioners do tend to focus heavily on services, there are typically significant energy efficiency opportunities inherent in core manufacturing processes. Some of these are quite simple e.g. operation of heated processes at lower temperatures. Others are more complex e.g. minimising agitation rates using variable speed drives without compromising product characteristics. The need to involve operational personnel in energy efficiency initiatives is therefore non-negotiable.

The above opportunities are fairly obvious. At the next tier of technical complexity are the simple, but less well-known operational changes that can yield large energy savings, such as evaporator temperatures on refrigeration plants, chiller plant temperature set-points, excess air levels on boilers and the pressure settings used on air compressors. At a similar level of complexity are simple plant modifications, such as insulation of hot and cold surfaces, daylight harvesting, increased condensate recovery and many others which I tend to find in many (but certainly not all) manufacturing plants that I visit. There is a growing awareness of these “no-cost/low-cost” opportunities, but their level of penetration in industry suggests that there remains significant scope for their adoption.

At the next tier of technical complexity are those opportunities such as speed changes for pumps and fans, alternative compressor and condenser controls for refrigeration plants, impeller changes for pumps, boiler feedback control systems, power factor correction systems and the like. These are opportunities that require a low to moderate amount of capital, yield good returns but are fairly technically complex to identify and develop. The level of penetration of many of these types of opportunities varies widely in industry.

Finally we enter the realm of technical complexity which considers systems at an integrated level and which may involve large, capital-intensive options. These are projects such as major fuel switches for steam generation, cogeneration projects, heat recovery projects, alternative furnace technologies and the like. These projects require an extensive amount of due diligence prior to implementation, and come with increased risk.

What I have tried to show with these examples is that while there are some “low-hanging fruit” available in terms of operational excellence approaches to energy efficiency, when viewed in its entirety, this can be a very complex and diverse field. The level of technical knowledge required is generally not found among manufacturing staff, not because they cannot acquire it, but more because it is not a core function. Manufacturers tend to focus on manufacturing product, and that in itself is a massive task given the challenges I mentioned at the start of this post. Very large manufacturing businesses may well have a central “energy team” that can provide assistance to local manufacturing sites. In most cases however, manufacturers do not have such resources, and once the first-order operational energy efficiency opportunities have been exploited, further progress on energy efficiency becomes limited. This is where I believe such organisations should recruit the help of specialists in the energy efficiency field. By combining the manufacturers’ knowledge of their core processes with the skills of a highly trained expert, significant further savings could be unlocked. And in most cases, the savings generated would be many multiples of the costs of the services acquired. This is particularly true when one considers the growing number of energy efficiency incentives available in South Africa (e.g. 12L and 12i tax incentives) as well as looming punitive measures such as the Carbon Tax.

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