Mass production of medicine bottles in a factory.
Energy management has rapidly emerged as a crucial business priority for companies within the sector, once considered a peripheral issue. With energy expenses ranking as the third-largest variable cost, and sometimes even exceeding direct labor costs, businesses must address energy inefficiencies effectively to ensure survival. The absence of guidance often leads organizations to measure the wrong metrics in ineffective ways, resulting in suboptimal resource allocation and missed opportunities for efficiency improvements.
You can also read: Energy Management Systems – Assessing Performance
A structured approach to energy management is crucial for addressing this challenge, with internal benchmarking serving as the foundational step to differentiate between base loads —the energy consumed when no production occurs— and variable or process loads related to manufacturing activities, enabling businesses to accurately quantify these components and identify areas for improvement.
External benchmarking expands this analysis by allowing companies to compare their energy performance against industry peers, facilitating the identification of best practices and setting improvement targets.
Additionally, drilling down to the machine level provides detailed insights into energy usage, empowering organizations to optimize performance at a micro-scale.
Internal benchmarking approach. Courtesy of Energy Management in Plastics processing – a framework for measurement, assessment, and prediction.
Understanding base and variable loads is essential; reducing base loads offers immediate cost savings; while optimizing process loads requires nuanced interventions to enhance operational efficiency without compromising output or quality. Assessing performance and generating production accountability is paramount in effective energy management.
Furthermore, predicting costs based on historical energy usage corrected for production volume enables accurate budgeting and resource allocation. By leveraging sales forecasts to anticipate production volumes, companies can proactively plan for energy expenditures, enhancing financial predictability and operational stability.
Companies benefit significantly from continuous data collection and analysis, which reveals patterns and trends over time, enabling them to track how process changes, management initiatives, or external factors impact energy consumption.
A critical consideration in evaluating energy efficiency is the influence of production volume on specific energy consumption (SEC). An example of the study conducted by the Institute of Materials, Minerals and Mining, illustrates how variations in production volume can distort SEC metrics, as higher production volumes tend to lower kWh/kg values due to simple amortization.
Production volume and SEC Courtesy of Energy Management in Plastics processing – a framework for measurement, assessment, and prediction.
Assessing energy efficiency based solely on SEC values can lead to misleading conclusions, especially when production volumes fluctuate. Relying on simplistic metrics like kWh/kg may overlook the relationship between production volume and base load, potentially hiding inefficiencies. For instance, a decrease in SEC might seem like an efficiency improvement, but it could simply be due to increased production volume, spreading the base load over a larger output.
To avoid such pitfalls, a holistic understanding of energy usage dynamics is essential. By integrating production volume, energy consumption, and base load considerations, companies can gain actionable insights into their energy performance, driving sustainable improvements and optimizing resource utilization.
The journey towards effective energy management begins with internal measurements, providing insights into current energy usage and paving the way for performance assessment and prediction. However, to drive substantial improvements, companies must also engage in external benchmarking against industry standards.
Empowering individual factory or process area managers with performance targets based on real production volume and internal energy benchmarks derived from historical factory performance fosters accountability and drives efficiency gains.
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There is no life without Plastics. Plastics have become integral part of modern day life. Humanity has to learn to responsibly use Plastics , practicing - Reduce, Reuse, Recycle.