Demand management: Create a competitive edge by monitoring energy use
Bob Zak, Powerit Solutions -- Manufacturing Business Technology, 10/28/2008 3:40:00 PM
Industrial manufacturers consume roughly one-third of the power used in the U.S. This fact is not lost on utilities and energy service providers. Lucrative programs and new incentives exist today for industrial companies as power providers try to find ways to tap into the demand side and create more capacity. With new control technology solutions available today and good strategies for implementation, it is now possible for foundries to take advantage of these opportunities to improve their bottom lines.
Utilities traditionally operate in a "give the donkey a carrot and the stick" type of mentality. These days the "carrot" typically is an incentive program like Demand Response where power providers offer to pay an end user to curtail power during brief, capacity-constrained hours. With usually 10-minute, 1-hour, or 24-hour notices, the user is asked to reduce electrical load for a few hours and is paid handsomely for every kW of reduction they deliver. The "stick" is a painful boost in prices for energy consumed during times of peak demand. In the not too distant future, it may be very expensive to run a manufacturing business during peak demand times.
The opportunities for manufacturers center on how to minimize the impact of increasing demand charges while at the same time positioning themselves to take advantage of lucrative earning incentives for programs like Demand Response. What before was a risky and difficult prospect can now be a true operating advantage for manufacturers deploying the right technology.
Intelligent energy management
Manufacturing facilities are not the same as commercial buildings. Limiting electrical demand without the right controls in a typical office building may result in a room getting a little warm, but it certainly cannot be called a critical event, whereas curtailing equipment on the factory floor without the proper automated controls in place can be devastating to the process—and, therefore, to the business.
Many industrial facilities use automation to control processes and increase manufacturing efficiency and reliability. In most cases, these same facilities use only manual procedures—if anything at all—to control how power is used. It is a surprising number, but less than 1 percent of all commercial and industrial companies rely on automated systems to measure and manage power consumption. The reason companies do not currently participate in energy management to reduce peak demand most often is risk. Many site managers are not confident the actions taken will produce benefit that will outweigh risk being taken.
But "intelligent" energy management can remove that risk and provide great efficiency, much as when companies automated many of their manufacturing processes. Intelligent energy management systems offer these benefits:
• Energy-savings actions are consistent, and the human factor (with manual reductions) is controlled.
• High-level calculations determine exact action needed; only the exact power needed to meet goals is shed, no more.
• Facilities receive instant access to energy data to make more informed decisions and gauge program success.
• The user predefines how the system will act under certain production situations, moving the decision to a financial one instead of an emotional one.
• Payback is usually less than 18 months and results are very measurable.
The type of energy automation used in manufacturing plants should be a type suited to its environment and needs. The construction of the solution from the controller to the I/O devices to the interface should be industrial-grade and specific to various manufacturing applications. New technologies for reducing installation costs such as wireless I/O and standard interfacing protocols—for communicating with existing automation—will keep the payback very enticing.
The system itself and the company providing it should be integrated not only with expertise on utility billing and rate scenarios, but also the specific needs of the factory. One of the best ways to evaluate this is to look for experience in your type of application and talk to current users.
Turning on revenue generators
Using the types of automated technology available today to carefully manage energy usage can provide a significant advantage over those companies that pass on these opportunities. Many utilities also offer innovative financing and grant programs that pay for some or all of the necessary technology investment—preserving valuable cash.
We have entered a "perfect storm" for investing in these types of energy management opportunities. In a market where uncontrollable costs such as energy, fuel, and raw materials continue to escalate, technology has once again risen to the occasion, offering a chance to pick up some well-needed ground.
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About the author:
Bob Zak is president of Powerit Solutions, a supplier of automated energy management solutions.
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