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Money is the energy saver for industries

resLoadSim model, smart grid, model, EU, energy, monitoring, grants, subsidies, ISO, industry, payback, energy consumption, plant, LED, costs, ECN, research, R&D, energy coordinator

resLoadSim model

Most of the industrial companies invest in (green) energy savings because of the direct financial benefits. Saving energy is no priority. This is the result from ECN interviews with seven companies in various sectors.

How do companies take their decisions on energy saving? To find out, ECN researchers engaged discussions with seven companies in the chemical, rubber and plastics industry and the asphalt industry. They questioned an energy coordinator, site manager, R&D manager, technical manager, managing director and operations director to gain insights into the behavior of companies with energy conservation.

The researchers wanted more clarity in which motives and frameworks influenced in their choices.

External stimuli are weak

Although an investigation of seven interviews is limited representative, ECN managed to filter a fairly unanimous picture about behaviors in energy savings.

  • A direct (financial) interest is the key driver for energy efficiency.
  • External stimuli from policies and customer requirements are weak and do not get direct business interests.
  • The implementation of energy saving measures depends mainly on the expertise and enthusiasm of ‘leaders’ within an organization and thereby support from management and board.

Priority

For most companies, the energy bill is so substantial that it is worth to pay attention to energy consumption. Yet energy savings are seldom a priority in asset management and resource planning.

  • In most cases, the 2% goal of energy savings is not translated the project level, such as purchase of new equipment
  • For projects, there are no resources allocated to energy: Leading motifs are usually lowering costs and increasing safety, quality and reliability, ECN writes in the report.

Energy is not that expensive, says a company. Saving energy is an extra benefit during projects with goals like expanding production, increasing logistics efficiency or reducing raw material and material consumption.

Long breath

Most energy-saving measures are no interventions in the production process itself. If so, this requires the stamina of the energy coordinator which needs to have a lot of knowledge to persuade his colleagues to start energy saving measures.

Interventions can only be started during

  • a production stop
  • the relocation of the production proces to another building or new plant

Such major changes can be reasons to purchase new, energy efficient machines.

Commitments

Most of the companies are focussing on reducing costs but they also have in mind what they are obliged to do by law. In addition to cost savings and obligations (compliance) a third reason is the ISO certifications related sustainability standards. ISO seems to encourage businesses to targets for Corporate Social Responsibility (CSR) commit.

Payback period

Usually the payback periods are 1 to 3 years. Only in exceptional cases the payback period is five years.

One company indicated that the acceptable payback period depends for instance on the lifetime period of installed equipment such as LED lighting, and the average payback on the projects.

By counting this way a company for some projects accepts, payback periods of 5 to 6 years. In case of the LED lighting project that was even seven years.

Grants

Companies wishing to invest in energy efficiency can rely on various grants. These grants reduce the payback period of energy saving measures.

But most companies do find grants convenient, but say they only take a look at the grants after the investment decision has already been taken!

A minority called subsidies unimportant or even undesirable. One company thinks that subsidies are not the way to save energy. More and stricter monitoring of actual energy consumption should be.

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