Inside the call for a manufacturing "greenprint"

On September 9, a coalition of groups involved in U.S. manufacturing called on the federal government to strengthen its strategy for “smart, safe, and sustainable” production. One of the specific requests in the call was that the government establish a $2 billion public-private partnership to research and develop a manufacturing “greenprint” for sustainable manufacturing.

But what exactly is the greenprint? Is it a technology product or system you can buy? Is it template or “blueprint” of best practices companies should follow? To find out, I talked to leaders at a couple of the organizations making the call for the stronger federal strategy: Rockwell Automation, a provider of industrial automation and plant information solutions, and the American Council for an Energy-Efficient Economy (ACEE), a nonprofit organization that advances energy efficiency. In phone interviews with John Nesi, VP of market development for Rockwell Automation, and R. Neal Elliott, associate director for research at ACEEE, I learned quite a bit about the greenprint concept.

For starters, the greenprint is not a single thing you can buy, nor is it a rigid framework for energy efficiency. Instead, the greenprint is a concept with multiple supporting technologies that gets manufacturers to the next level of energy efficiency, while supporting the ability to manage energy costs more dynamically as utilities update the nation’s electrical grid. The components of a greenprint could include smart sensors and intelligent controls, more efficient drives and motors, and just as importantly, the software to tie it all together and correlate energy use to traditional metrics for manufacturing success like throughput, capacity utilization, and quality. The organizations making the call for an improved federal manufacturing strategy see the success of greenprint as being accelerated if the government adds funding for research & development, as well as better financing to make the technologies more affordable for U.S. manufacturers.

The need

One of the main goals behind the greenprint concept is to make energy management a more “real-time” aspect of operations. According to Nesi, all too often in manufacturing companies today, energy use is backward allocated for the entire plant.  “The long-term vision of the greenprint is to go from what I call passive allocation of energy costs to active, automated demand management of your energy costs as part of the bill of material of the products you are producing,” says Nesi.

To get to this next level, says Nesi, much more granularity is needed over energy consumption within plants, as well as the ability to correlate real-time energy use with plant data on production availability, performance/throughput, and quality–the type of measures that go into the overall equipment effectiveness (OEE) metric. To achieve this granularity, some new control technology might be needed, as might some new software for energy management and plant intelligence.

Nesi contends, however, that for many manufacturers, realization of the greenprint will depend more on correlating trends to arrive at better intelligence, rather than a wholesale upgrading or replacement of their controls and plant automation infrastructure. “What people don’t recognize is that they are already automating all of this machinery inside their factory-they already have IT systems hooked up to it-and if they just leverage some of the sensing capabilities that are built into the load … you can take a look at your energy management from the ‘load out’ rather than from the ‘supply in,’” he says.

ACEEE’s Elliott says that while industrial automation has done much to make individual machines or production processes more efficient, what is needed is a more systematic approach that gets entire plants or supply chains optimizing their processes with energy efficiency in mind. For example, he says, industry could do more to correlate quality trends on parts defects to energy waste. Since it takes as much energy to make a bad part as a good part, and a bad part can create bottlenecks further downstream in the supply chain potentially holding up value-added processes that depend on that part, improvements to quality could lead to significant energy savings. Supply chain partners might also consider using “lean and green” methods to improve energy efficiency, he adds. “That’s the real key that we are looking for … trying to really exploit those systems opportunities that exist in manufacturing,” says Elliot.

Potential objectives

Nesi says he hasn’t looked into what might included in a public/private partnership for greenprint, but expects that the associations involved in the call, such as ACEEE and the National Association of Manufacturers, will be able to work out the details of any such public/private partnership program. ACEEE’s Elliott says there are plenty of potential objectives that a $2 billion public-private partnership program might address. Among these:

• Expand the Industrial Assessment Center program under the Department of Energy (DOE), which Elliot says is currently funded at about $4 million a year, eventually up to about $40 million annually.
• Expand the Industrial R&D program under the DOE from current funding of $18 million a year, to as much as $250 million annually.
• Developing funding and finance mechanisms for manufacturers to invest in greenprint technologies. Elliott says there is a bill currently working its way through the U.S. Senate (S-661,  Restoring America’s Manufacturing Leadership through Energy Efficiency Act of 2009, sponsored by Sen. Jeff Bingham, Dem., N.M.) that envisions a revolving loan mechanism to encourage energy efficiency investments, and calls for funding of $90 million per year. Elliot says this type of mechanism would help, but should have a higher level of funding to accelerate greenprint adoption in U.S. plants.

What’s next?

Elliott says there are some encouraging signs from the Obama Administration that it is serious about strengthening the federal strategy in support of manufacturing, including the recent naming of Ron Bloom as manufacturing policy advisor for the Administration. But it’s too early to predict what sort of response the Administration will make in regards to the call, he adds, although some DOE officials already are talking to the associations about the implications of the call.

Elliott says that whatever gets decided in terms of a federal manufacturing strategy, the other concern is that the government stick to its funding commitment. In recent years, says Elliott, federal funding for manufacturing-related R&D and programs has been cut when the overall federal budget needs to be trimmed during appropriations.

What funding for greenprint and energy efficiency technologies has going for it, says Elliott, is a strong payback potential, as evidenced by ACEEE research that show that energy efficiency remains America’s cheapest, cleanest, and fastest energy source, as well as a recent study from McKinsey & Company that looked at the payback of energy efficiency measures.  As Elliott puts it, “we have a lot of proof points.”

What’s your view? Is it time the federal government reinvigorate its manufacturing strategy and increase funding for technologies that fall under the greenprint concept? Are you all for such increased funding, but don’t think it stands much of a chance, given our current economic and budgetary challenges? Please post a thought or email me at rgmichel@gmail.com.