Buildings and Energy Efficiency

Energy efficiency is often compared to picking up dollar bills off the ground. It is, in theory, one of the simplest ways to save money in a facility.

In commercial buildings, those dollar bills can be hanging around within close reach. As a recent analysis from FirstFuel pointed out, nearly half of the efficiency opportunities in commercial buildings can be realized through changes to behavior or tweaks to equipment operation schedules. That doesn't mean equipment retrofits aren't needed, but it illustrates the relative simplicity of savings potential.

However, what if those dollar bills were stuffed underneath a conveyer belt at a pulp mill? Or shoved behind the freezer coils at a meat processing facility? Picking up those bills wouldn't be nearly as simple.

Reaping savings in the industrial sector is more like a scavenger hunt, or like sitting in one of those money machine booths grasping at dollar bills as they wildly whip around.

"There's a myth in the industry that energy efficiency is always easy," said Marcus Wilcox, CEO of Cascade Energy, in an interview. "Efficiency is in the industrial sector is always more work, and it requires a good amount of experimentation."

Oregon-based Cascade Energy has done technical energy engineering work at 4,000 corporate and industrial sites over the last twenty years. A few years ago, the firm developed its own piece of intelligent efficiency software, called Sensei, which focuses on how to tweak operations to save energy in industrial facilities.

Wilcox said that other pieces of energy management software Cascade experimented with had a "decidedly commercial feel to them" and failed to provide the diverse functionality needed for the challenging industrial sector. So Cascade designed its own.

"A lot of those platforms had artificial barriers that limited data, operated very slowly, or that didn't account for the incredible diversity of assets in a facility. They also didn't account for the events that can change how equipment is operated. There are so many variables," explained Wilcox.

So what makes the industrial sector so much different? Here are a few factors to consider.

Industrial environments are extremely complex

In an office building where usage patterns are less varied, it's fairly easy to model energy consumption and normalize it against external factors, therefore providing solid predictions on how to operate equipment. But in an industrial facility where weather, product variation and constantly changing schedules are the norm, predictions are far more difficult.

For example, a pulp mill may see dramatic changes in energy use day to day based on the size of logs, volume of logs and whether they are wet or dry. Cascade models those variables through a regression analysis and provides real-time recommendations for making tweaks to operations that can reduce energy consumption.

The Israeli company Lightapp does something similar in the manufacturing sector by monitoring how materials input, maintenance routines and other factors impact production efficiency. Both companies see operations and maintenance as a core way to address energy use.

"There's a whole greenfield of efficiency that hasn't been tapped through O&M. But you need a tool that can take a tremendous number of independent variables and make sense out of them," said Wilcox.

Efficiency is a relatively low priority for many industrial companies

At most facilities, energy efficiency ranks below safety, meeting environmental regulations, and productivity. So getting a facility manager to care about energy use requires a lot more than walking in with a cool-looking dashboard. Industrial customers are very risk-averse and will not make changes to existing processes if they could jeopardize the flow of operations.

"We know that energy is not the most important thing for them. They're already used to measuring everything, and they're used to seeing copious amounts of data, so there needs to be an extremely good link between action and measurement of the results," said Wilcox.

Even when industrial customers show interest, they are often very slow to integrate new processes. That means a company like Cascade has few chances to sell a new product or service throughout the year, and usually needs a window of opportunity when there is downtime at a plant. In addition, a deep understanding of the equipment at a facility may only be held by a few people with deep-seated resistance to change. This "tribal knowledge" factor can make continuous process improvements tough.

Energy savings in the industrial sector are often "lumpy"

Due to the wide range of variables in the industrial environment, savings don't always come as consistently as they often do in the commercial sector. This makes efficiency opportunities highly variable and can make monitoring and verification much more technical. Like any customer, companies in the industrial space want to know what the savings will be upfront before a project is approved -- making accurate modeling extremely important. 

Despite those challenges, Cascade has seen some pretty significant savings across its portfolio of companies. The food giant Sysco reported a 35 percent drop in energy use at its warehouses since 2006 after it partnered with Cascade for energy monitoring and equipment upgrades (PDF). Another customer, the polymer manufacturer Fitesa, is cutting energy use by nearly 20 percent a year through better monitoring of production lines.

These savings are not all through software. Cascade also plays a more traditional energy management role by designing projects and installing equipment. But the software-based approach can have a big impact itself. Lightapp, another industrial efficiency company that focuses on streamlining operations through software, said its 40 customers have seen yearly energy savings of between 6 percent and 15 percent.

The industrial space is extremely technical, however. And both companies have to work hard to convince plant managers and other operators they can meet those technical challenges and bring real savings without interrupting the flow of production.

"Energy efficiency is a business decision. No company is going to do industrial energy efficiency because of the way it makes them feel," said Wilcox. "If you’re going to do deep conservation in the industrial sector, you can’t ignore the technical components that are radically different from commercial or residential."

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