The unique challenges of industrial energy efficiency
According to the U.S. Energy Information Administration (EIA), industrial sector energy use accounts for more than 30 percent of the country’s total energy consumption. Further, the EIA predicts that this percentage will continue to increase over the next 30 years. This growing energy use also provides opportunities for substantial energy savings.
Unlike many commercial and residential buildings, industrial facilities have unique energy requirements. While commercial buildings might be able to save on lighting or HVAC, industrial facilities’ major energy consumption – and thus opportunities for savings – are related to production. Each manufacturing plant has specialized equipment and processes, which are necessary for production but also create two unique energy efficiency challenges: quantifying energy savings and capturing utility incentives.
Quantifying energy savings. ENERGY STAR® and DesignLights® Consortium provide energy savings estimates for lighting and other equipment commonly used in many types of facilities. However, these rating organizations do not provide savings estimates and guidance on selecting the most energy-efficient production equipment for specialized industrial settings. In order to accommodate a new product line, a bottling facility may need to purchase a new packing machine, which can vary widely in price and energy consumption. In most cases, calculating the return on investment on the more efficient equipment can be complicated, often requiring pre- and post-metering verification for energy savings and potential productivity increases. As a result, industrial facilities often have to rely on custom metering to verify the potential savings of energy efficiency measures.
Capturing utility incentives. Nearly all of the 3,000 electric utilities in North America offer rebates for energy efficiency upgrades. However, most utilities define incentives for common equipment upgrades, like lighting, refrigeration, and HVAC. As a result of the specialized equipment and processes, identifying and capturing energy efficiency rebates for industrial utility customers poses a difficult challenge. Often, an industrial facility will need to partner with the equipment vendor to effectively measure energy savings and secure custom incentives from the utility. For companies with industrial facilities spanning multiple utility territories, managing the rebate process becomes cumbersome and complex.
Fortunately, the benefits of participating in utility energy efficiency programs outweigh these challenges for many industrial facilities. Energy efficiency upgrades and process improvements can result in more than just energy savings. Industrial facilities also benefit from increased production with more efficient processes, savings on water and other raw materials, and increased profitability from the decreased production costs and time.
The utility of the future
Participating in utility energy efficiency programs simply makes good business sense. The utility business model is expected to evolve rapidly to include distributed energy resources (DERs) in their program offerings. These new services may include demand response, energy storage, and electric vehicle charging infrastructure.
The key to unlocking industrial energy efficiency benefits is an upfront analysis to accurately predict the effect of energy efficiency upgrades on energy consumption and overall production. Leidos works with industrial customers across North America to perform energy analyses, quantify investments in energy efficiency, and manage energy efficiency initiatives. We provide custom metering and monitoring to verify potential energy savings, and we work with trade allies and utilities to secure incentives for these initiatives. With more than 30 years of experience managing energy efficiency programs for both large industrial facilities and utilities, we have a comprehensive understanding of industrial energy efficiency programs.