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VAASA 2011 UNIVERSITY of VAASA Faculty of Technology Author: Jussi Peltomaa Topic of the thesis: Energy efficiency of industry – Present situation and saving potential of supporting processes Name of the supervisor: Adjunct Professor of Knowledge Management Marja Naaranoja Degree: Bachelor of Science in Economics and Business Administration Discipline: Industrial management Starting year of the studies: 2009 Completion year of the thesis: 2011 Number of pages: 36

FOREWORD The oversized use of fossil fuels has been given much attention in recent years. It has been known for a long time already that compared to their renewal, fossil energy resources are consumed at too high of a rate. The Earth Overshoot Day, i.e. the day when the renewable energy resources of the world have been used up for that particular year, was reached in 2010 on the 21st August. (Ministry of the Environment, 2010). The oversized energy consumption has caused discussion about the climate change and this discussion brings about stress for the biggest consumer of fossil fuels, the industry. The annual share of worldwide consumption of coal by the industry is 78%, the share in the consumption of electricity is 41%, and in the overall consumption of natural gas the industry consumes 35% (International Energy Agency 2010a, 32–35). The struggle against climate change has caused numerous changes in legislation and in the future the importance of energy policy will enhance further. In the efforts against the climate change, the improvement of energy efficiency is one of the most important tools, and


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numerous studies (Thollander, Dotzauer 2010; Thollander, Ottoson 2010; Thollander, Danestig, Rohdin 2007; Rohdin 2008; Trygg, Karlsson 2005; Trygg 2002) show that the potential of energy efficiency is essential in industry. One of the biggest questions is: how big is this potential in reality? In 2009, the overall energy consumption of Finnish industry was 508 PJ, and the overall consumption of electricity was 37 272 GWh. The share of the forest industry in the overall consumption of electricity was 19,000 GWh. The big share of the forest industry in the electricity consumption tells about the focussing of the Finnish industry on energy intensive sectors (Finnish official statistics 2009). I have received the subject for this thesis from the company Enersize Oy. The company in question is specialized in solutions increasing the energy efficiency of compressed air use. The future objective of the company is to develop an integral system of improving energy efficiency, which will help to improve energy efficiency in several different subsectors. This work, in turn, helps the company to achieve its objective by finding out the general situation of energy efficiency and the possibility of energy efficiency being present in the industry. The goal of this work is to increase the knowledge about energy efficiency of the industry and its savings potential. Energy efficiency of the industry can be improved in different subsectors. This thesis focuses on the production and support processes of the industry as well as on their possible energy efficiency potential. The thesis also studies energy efficiency programmes that are being carried out in Finland and Sweden, as well as the results of these programmes. To begin with, the thesis presents the operating commodities used in the industry and how they are used in production and support processes. After the presentation of the operating commodities, the fundamentals of energy efficiency will be scrutinised and the term “energy efficiency of the industry� will be defined. Following the fundamentals, the energy efficiency in Finland and the current programme of energy efficiency contracts will be examined. In energy efficiency agreements food industry, technology industry, and energy intensive industry are used as examples. After examining the situation in Finland, the energy efficiency programmes carried out in Sweden and their results are reviewed. The results of the thesis are finally presented in the conclusion and the summary.


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2. OPERATING COMMODITIES In industry, the manufacturing process can be divided into different processes – the production process and several support processes. The production process is a core process where the product is formed and manufactured into its final mode. Support processes are processes that support the production process. Operating commodities and operating commodity systems belong to the support processes and are a type of external auxiliary means with the help of which the production process functions. The purpose of the operating commodities is to produce additional value to the product that is manufactured. Energy is an operating commodity and with the help of the operating commodity systems, energy will give additional value to the products. Electricity is often converted to a mechanical force which propels the equipment. Thermal energy can be used in industry for heating the process flows. Compressed air, cooling liquids, fuels and electricity can for example be considered as operating commodities (Broughton 1994, p. 1–2).

Table 1. Examples of production and support processes Production processes:

Support processes:

Shaping Heating Melting Joining Blending Drying

Lighting Ventilation Compressed air Pumping Space heating Hot tap water Engine preheating Fans


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Operating commodity systems can be divided into four groups. The first group is the energy transportation operating commodities that contain fuels, vapour, electricity and heating/cooling liquids. The second group is formed by water and wastewater consumed by the process. The third group consists of compressed air, inert gases and hydraulic liquids. The fourth group contains ventilation and air conditioning (Broughton 1994, p. 1–2). The operating commodities are of great importance for the industry, and their usage is inevitable for maintaining the production. The activity field of operating commodities is extremely wide and often especially the selection of a right system is very important so the system will meet the requirements and needs of the company. At its best, the operating commodity system may function with high energy efficiency, but at its worst, it may spend constantly excessive energy and cause additional expenses for the company. By measuring the energy consumption of the operating commodity systems, an overall picture can be formed about the total energy consumption of the process (Broughton 1994, p. 1–2).

3. ENERGY EFFICIENCY Defining energy efficiency is not always simple, especially, if you are trying to compare the energy efficiencies of different branches of industry. Energy efficiency can be defined for example in the following way (Finnish Environment Institute 2008, 20–27): •

Obtaining the same production/value with lower energy consumption.

Obtaining larger production/value with lower energy consumption.

Achieving increase in the production volume or production value with a relatively smaller increase in energy consumption.

It is possible to improve energy efficiency by using energy more efficiently. The efficient use of energy may mean two different things: the volume of production received by entering a certain amount of energy into the process, or the optimisation of


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the amount of energy in relation to the energy demand of the process. According to the rules of thermodynamics, the coefficient of efficiency may by no means exceed 100%, since all processes are accompanied by a loss of energy. Improving energy efficiency reduces the amount of losses. Low energy efficiency is caused by an unbalance between energy supply and energy requirement which, in turn, may be related to poor planning, usage or maintenance. Low energy efficiency may be also caused by the unnecessary operation of equipment, using unnecessarily high temperatures as well as a lack of energy storing possibilities etc. (Finnish Environment Institute 2008, 20–27). To determine energy efficiency one can use different measuring instruments which are capable of monitoring the energy consumption in relation to some reference period, level or facility. BAT (Best Availability Technique) level may be used as a reference value. For comparing with reference facilities, benchmarking techniques may be used. Energy efficiency is often measured by finding a relation between the volumes of used energy to the production volume – in this case, it is called specific energy consumption. Specific Energy Consumption (SEC) can be defined as follows (Finnish Environment Institute 2008, 21):

SEC,

Specific Energy Consumption is often related to production, but energy consumption may also be related to the surface area or to the employee-specific indicators. Specific energy consumption may be compared with the selected reference value by the help of Energy Efficiency Index (EEI) (Finnish Environment Institute 2008, 22).

EEI


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BAT value, a value realized in the reference period or, while comparing with other operators, a benchmark value can be used as reference value. The intensification potential of energy consumption can be calculated by the help of energy efficiency index (Finnish Environment Institute 2008, 22).

Energy intensification potential

3.1. Energy efficiency in industry In industry one of the biggest challenges of energy efficiency, as modes of operation develop, lies in the increase of production volumes and production speeds. While the volumes are increasing, the equipment dimensioned for the initial production is too small, i.e. they are running at a poor coefficient of efficiency or causing excessively large pressure losses. Without an energy efficiency system, this kind of development is difficult to stop (Finnish Environment Institute 2008, 20–27). The increase of energy price has a large impact on the competitiveness of companies if companies in the western countries are compared to companies from countries of cheap workforce. Companies in the western countries lose when comparing their production costs to those of the companies from the countries with cheap workforce that is why the savings in energy costs are of vital importance. By improving the energy efficiency of industry, we can achieve big economic savings, and also improve the competitiveness of companies. Improving energy efficiency in industry is one of the measures that help to reduce the use of fossil fuels and to lower the CO2 emissions. It is vitally important for countries to participate in the improvement of energy efficiency with different programmes and tax abatements, since the highest motivator for the companies to reduce energy consumption is the decrease of expenses. The next most important aspect is the protection of environment and the third most important motivator is the achievement of the image of a green enterprise (Christofferssen, Larsen & Togeby 2006; Thollander 2008, 11; Finnish Environment Institute 2008, 20–27). In industry energy efficiency should be measured on the process level, where the energy levels and consumptions of individual equipment can be monitored and compared with the selected reference values. A systematic monitoring of energy efficiency helps to form the energy consumption of the whole production unit, and thus the energy


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efficiency of the whole unit can be monitored. The objective of monitoring the energy efficiency of a production unit should be the creation of a system that monitors the energy consumption and efficiency of processes. By measuring the energy efficiency at a factory area, the relation of primary energy consumption to the overall production can be monitored. By monitoring the measurements at a factory area, an understanding can be formed about the development directions of energy efficiency at that factory area. By measuring one can form an understanding about the real effect of energy efficiency programmes and equipment investments to competitiveness and their relation to the overall energy consumption. While comparing the results of the energy efficiency measurements of different sectors of industry or different countries you should take into consideration the conditions prevailing in each country. The possibilities for improving energy efficiency may be reduced in different countries, as the legislation and the environmental policy have a large impact on the behaviour of companies (Rohdin 2008, 10; Finnish Environment Institute 2008, 27).

3.2. Energy efficiency in Finland The agreement activities aimed at the energy efficiency in Finland started in 1997 when the first energy efficiency contracts were concluded. The first agreement period lasted until 2005, after which it was still continued until 2007. During the continuation period of the first programme, new energy efficiency agreements were planned under the leadership of the Ministry of Trade and Industry together with business sectors, associations and companies. While planning new energy efficiency agreements, objectives according to the European Union directive of energy services were used as a target basis. EU gave Finland a target directive, according to which the energy consumption should be reduced by 9% in the period of 2008–2016. A new and presently valid energy efficiency agreement covers years 2008–2016 (Finnish Environment Institute 2008, 29). Energy efficiency agreements are focussed on and planned separately for each business sector, and their objectives mainly correspond to the goals required by the directive of energy services. Each company belonging to the interest group of the business sector may join the energy efficiency agreements. The Finnish energy efficiency agreement activity is the most widely covering activity model in the whole EU area. The company joining the agreements is not required to perform any certain operations, but it can plan its actions itself. The companies should, however, establish their energy efficiency


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objectives for the whole agreement period, until the year 2016. The role of the Finnish government is mainly to offer support for the actions and for the energy inspections carried out by the companies. The company joining the agreement obliges to follow the activities of continuous improvement of energy efficiency, as well as to take into use innovative technology. Energy efficiency system based on continuous improvement activities has been developed for the companies who have joined, helping them achieve goals that they have set. The companies joined with the agreement should report by the end of February each year about the operations of the previous year. The report should include the energy consumption for the previous year, measures for intensifying it, investment costs for the intensification measures and the ways set objectives have been reached. The companies are able to receive feedback about their energy efficiency operations and the results available in the report (Pekkarinen 2010, 26; Finnish Environment Institute 2008, 29–33). The reports of the companies that have joined the energy efficiency agreements are not available, since they are strictly confidential and will not be handed over to third parties. The information available from the energy efficiency contracts is on a rather general level based on the summaries of the companies from the same sector. 3.2.1. Energy efficiency agreements: food industry This chapter will review the results of 2009 report of food industry companies that have joined the agreement. The report has been published by Motiva. By the end of 2009, 29 companies had joined the energy efficiency agreement of the food industry covering 65 places of business. In 2009, the total energy consumption of the companies was 2,210 GWh/year, from which the share of electricity was 771 GWh/year (35%) and the share of thermal energy/fuels was 1,439 MWh/year (65%) (Hyytiä & Elväs 2009a). In 2009, the companies reported about 44 actions improving the energy efficiency with overall savings of 21.43 GWh/year. The total investment costs of the actions were 450,000 €. From this improvement, the share of electricity was 1.18 GWh/year (6%) and the share of thermal energy/fuels was 20.25 GWh/year (94%). With the actions in 2009, the companies reported saving 290,000 € from their annual energy costs. The savings calculation is based on the following costs: electricity 68 €/MWh and fuel 25 €/MWh. The overall energy efficiency objective of companies that joined the agreement during the first two years, is 213 GWh, and the 40.1 GWh achieved by the end of 2009, is 19% from the overall objective. (Hyytiä et al. 2009a).


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3.2.2. Energy efficiency agreements: technology industry Chapter below will review the 2009 annual report on technology industry companies that have joined the energy efficiency agreement. By the end of 2009, 52 companies had joined the energy efficiency agreement covering 131 places of business. In 2009 the overall energy consumption of companies that had joined the agreement, was 1,639 GWh/year from which the share of electricity was 842 GWh/year and the share of thermal energy/fuels 797 GWh/year (Hyyti채 et al. 2009b). In 2009, the companies that had joined the agreement carried out 136 energy saving actions, by the help of which they achieved a 29.27 GWh saving in energy consumption. The share of electricity in the overall savings was 20.94 GWh (78%) and the share of thermal energy/fuels was 8.33 GWh (28%). The savings achieved by these actions corresponds to 1.79% of the energy consumption of the companies that have joined the agreement. The investment costs of the actions amounted to 3.56 million euros (Hyyti채 et al. 2009b). The objective of energy savings for companies that joined the agreement during the first two years was, for the whole agreement period, 185 GWh. By the end of 2009, 24% (44.1 GWh) was achieved from the overall objective (Hyyti채 et al. 2009b). 3.2.3. Energy efficiency agreements: energy intensive industry Energy intensive industry is one of the largest sectors in the energy efficiency agreements. Mainly companies that have the annual energy consumption of over 100 GWh will be approved in this sector of energy efficiency agreements. By the end of 2009, 37 companies had joined the energy efficiency agreement covering 143 places of business. The overall energy consumption of the energy intensive industry for year 2009 was 104,083 GWh from which the share of electricity was 27,794 GWh and the share of thermal energy/fuels 76,289 GWh. The energy consumption of thermal energy/fuels does not include fuels for the production of electricity (Hyyti채 et al. 2009c). In energy intensive industry, 103 energy saving actions were reported in 2009. The total energy saving of these actions was 681 GWh. The share of electricity in the overall savings was 112 GWh (16%) and the share of thermal energy/fuels was 569 GWh


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(84%). The total energy saving achieved by the actions corresponds to 0.65% of the total energy consumption of the sector. The investment costs of the actions amounted to 24.6 million euros and the decrease of the energy costs achieved by the actions was about 18 million euros (Hyyti채 et al. 2009c). The companies from the energy intensive industry that have joined the agreement determine themselves their individual saving targets for the agreement period. No business place specific saving targets are required from the companies that have joined the agreement. In 2009, only 14 companies have determined quantitative saving targets which correspond to 10% of the companies that have joined agreements (Hyyti채 et al. 2009c).

4. ENERGY EFFICIENCY OF INDUSTRY IN SWEDEN In Sweden, there are about 59,000 companies, from which 99% are not energy intensive, and the rest of the companies, about 600 in all, are energy intensive companies that use up the majority of the amount of energy used by industry. In Sweden, only 98% of the companies are classified as small or medium size companies.


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The study of energy efficiency of the industry plays an important role in Sweden, and valuable research work is being done in the country to improve the energy efficiency in the industry.

4.1. Program for Energy Efficiency Program for Energy Efficiency (PFE) was started in January 2005. The program was initiated by the Swedish Energy Agency (SEA), and was concentrated on the use of electricity in energy intensive industry. During the first two years, 98 companies from different fields of industry participated in the program. The overall consumption of electricity by the companies was 31,200 GWh/year and the consumption of total energy was 106,600 GWh/year. First, an energy audit was organized for all participating companies, thereafter; an energy management program was taken into use, where attention was paid to the organisation and its behaviour. Before the PFE program, the integral energy audits have been rare. The companies that have participated in the program received tax deductions provided that they act the way foreseen in the program and implement the proposed energy efficiency measures (Rohdin 2008, 11). As a result of these audits about 900 energy efficiency actions were carried out. The saving potential of the actions was about 1 TWh which was distributed evenly between the production processes and the support processes. 48% of the actions were focussed on the production processes and 52% on the support processes. The most widely spread actions among support processes turned to be actions related to the compressed air, pumps and fans (Rohdin 2008, 11).

The table shows the distribution of actions between production processes and support processes as well as their share in 1 TWh of the total saving potential.


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Table 2. Allocation of the actions of the PFE program and amount of savings (Thollander, 2007) Action:

Share from the total savings Quantity% (1 Twh)

Production process

48%

480 GWh

Pumps

17%

170 GWh

Compressors

10%

100 GWh

Other electricity powered

7%

70 GWh

Fans

6%

60 GWh

Motors

4%

40 GWh

Space heating and ventilation

3%

30 GWh

Indirect costs

2%

20 GWh

Chiller plants

2%

20 GWh

Lighting

1%

10 GWh

4.1.1. Case: foundry and cellulose/paper industry PFE program includes companies from different branches of industry. In this chapter, two branches of industry will be reviewed that have participated in the project – foundry and cellulose/paper industry. The companies operating in the foundry industry were classified as medium size companies and the companies operating in the cellulose/paper industry as large companies. In case of energy intensive companies, the price of products and production are largely influenced by the price of energy. The energy price affects the production and the expenses of foundries about 5–15%, and the costs of cellulose/paper factory even 20%. In energy intensive industry, where the energy price affects largely the expenses of companies, a long-time energy strategy plays a very important role for the optimisation and allocation of energy costs (Thollander, 2010b). Less than half of foundry companies participating in the PFE program had a long-time energy strategy. Among the companies of cellulose/paper industry, every fifth company lacked a long-time energy strategy. The largeness of these numbers can be explained with the fact that the companies are contributing to the core processes of the sector


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where energy management is not included. The results may appear slightly surprising, since according to researches, the company that establishes a long-time energy strategy and carries out the actions aimed at energy efficiency, can save up to 40% of its energy expenses. One of the explaining factors can also be the result of the PFE program research: 52% of actions increasing energy efficiency were focussed on the support processes. Concerning this kind of companies, the role and initial contribution of support processes is really much smaller than that of main processes. The improvements aimed at the main processes are often included in the strategy of the whole organisation, and thus their role is considerably bigger than that of the support processes, which mostly have a role on a lower, operational level. The adoption of energy strategy and management seems to be in relation to the size of the company and the level of its energy intensity (Thollander et al. 2010b; Christofferssen et al. 2006; Caffal 1996). The return on investments (ROI) plays an important role when the decisions are made about investments improving energy efficiency. For both branches of industry, the repayment period of three years or below is suitable for energy efficiency investments. According to the results, only about 40% of the companies of the cellulose/paper industry can obtain, to some extent, “clean papers� that are concerned with energy efficiency and energy management. In foundry industry, the corresponding number is only 25% (Thollander et al. 2010b). The absence of energy management and energy strategies in most energy intensive industries in Sweden, as well as the fact that Sweden is one of the most energy intensive countries in the world, arise thoughts that the role and situation of energy efficiency cannot be on a better level in none energy intensive small and medium size companies (Thollander, et al. 2010b).

4.2. Project Highland Highland project was started in Sweden in 2003 and it lasted until 2008. The target groups for the Highland project were small and medium size enterprises in Highland area. The first part of the Highland project has been assessed by now (Thollander, Danestig, Rohdin 2007). In Sweden, no program aiming at the improvement of energy efficiency oriented to the small and medium size enterprises has been carried out after 1990. Neither is this trend only a problem in Sweden, all over the world energy efficiency programs has become


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rare for small and medium size enterprises. 340 companies participated in the Highland project. The number of employees varied from only a couple of workers up to companies with 450 employees, the average being 72 employees. The overall energy consumption of participating companies was 1.1 TWh which covers about one half of the total energy consumption of the target group (Thollander, et al. 2007). The energy audits for the Highland project were organised by the Energy Agency of South-East Sweden, excluding some audits where the local energy enterprise assisted. The auditing was planned for two days: on the first day a visit to the company was organised, and on the second day the results of the visit were compiled into a report. The auditing method used in the project can be classified almost analogous to the first level walk-through analysis in the ASHRAE classification. In the Highland project, 340 energy audits were carried out in six different municipalities. 139 of these audits were performed in production facilities. The Highland project concentrated only on energy audits, the strategic measures were not much considered (Thollander, et al. 2007). In the Highland project, the proposals for improving energy efficiency are mainly focussed on such support processes as water supply, heating, cooling, ventilation, lighting, compressed air, training and decision-making. 643 improvement proposals were made in the whole project of which the total of 142 proposals has been implemented and 139 are planned to be implemented. Four most often implemented improvement proposals in the Highland project are also focussed on support processes such as ventilation, heating, lighting and compressed air. The strong concentration of proposals only on support processes can be explained by two reasons: the support processes play a bigger role for small and medium size enterprises than for the energy intensive companies which are target groups in PFE program. The other reason can be that the experts involved in the Highland project were mainly experienced in the field of support processes (Thollander, et al. 2007). 4.2.1. Results of the Highland project The first part of the Highland project has been assessed. This included 47 companies and the assessment of their audits. The overall expenses on energy, electricity and other carriers of energy and their saving potentials, as viewed in the Highland project, are presented in the next table.


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Table 3. Energy consumption and saving potential in the Highland project (Thollander et al. 2007) 47 assessed companies

The whole project (139 companies)

Use of electricity

100,347 MWh

230,347 MWh

Saving potential, electricity

21,262 MWh

43,532 MWh

Use of other energy carriers

81,348 MWh

209,612 MWh

Saving potential, other energy carriers

18,627 MWh

33,193 MWh

Total energy use

181,691 MWh

439,959 MWh

Total energy saving potential

39,889 MWh

75,725 MWh

The Highland project made 642 energy efficiency improvement proposals of which 142 proposals have been implemented and 139 are planned to be implemented. The energy efficiency improvement measures have always two sides. The first one is the cost of the improvements and the other is the repayment period in relation to the reduction of energy consumption caused by the measure. All 643 measures proposed by the Highland project will improve energy efficiency, but the question is, how many of the proposed measures are actually economically profitable to implement (Thollander, et al. 2007). 22% of all implemented measures in the Highland project were focussed on the heating, but this support process has an overwhelmingly large number of measures, over 100,


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the implementation of which has not even been considered. Ventilation had the biggest share of all implemented measures: 24%. Regarding ventilation, the number of implemented measures is bigger than the number of measures the implementation of which was not considered. Regarding compressed air, the majority of measures are related to areas that are not considered to be implemented. Regarding lighting, the number of not considered measures is almost twice as big as the number of implemented measures. One reason may be the relative simplicity of the first improvement measures related to lighting, such as switching off the lights when leaving the room, etc. An interesting fact was found in connection with the production processes. In the Highland project the small and medium size enterprises form the target group, the number of implemented measures in the production processes of the companies participating in the project is almost twice as small as the number of measures that have not been considered to be implemented (Thollander, et al. 2007). The share of the implemented measures in relation to the not considered measures can be a sign of a situation where the potential improvement measures are being searched from ever deeper levels. At some stage, economic borders will be encountered, after which it is not reasonable any more to carry out improvement measures, or the reduction in consumption caused by the improvement measures is marginal. Heating is a good example of such situation. Although a big share of implemented measures was focussed on heating, then a really big share remained unimplemented which was likely caused by the contribution and the cost required for the measures. Concerns the production processes, the situation is analogous. The contribution connected with the production processes is generally really big, and they will often not be implemented (Thollander, et al. 2007).

Table 4. Distribution of saving measures of the Highland project between different processes (Thollander, et al. 2007) Process

Share, %

Ventilation

24%

Heating

22%

Compressed air

17%


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Lighting

14%

Production process

13%

Training

5%

Water 4.3. Oskarshamn municipality

3%

In Oskarshamn, Sweden, a project aimed at energy efficiency and the reduction of electricity consumption in industry was carried out. In all 11 companies from different branches of industry were assessed. The project included nine factories and one nuclear power plant where two different areas were assessed. The objects to be assessed were selected to represent different branches of industrial and business activities as well as different intensities in connection with the consumption of electricity and energy. The total energy consumption of the companies participating in the Oskarshamn project was 176 GWh/year from which the share of electricity consumption was 87 GWh/year. The companies used district heat about 2 GWh/year and the consumption of oil was 79 GWh/year. The energy consumption varied in the companies from 1 GWh up to 70 GWh (Trygg, et al. 2005). The objective of the Oskarshamn's research was to concentrate on finding total changes in systems and not to increase the efficiency of existing equipment. During the project visits were made in daytime when the production was running and also at night when the task was to investigate energy consumption when the production was not running. The use of total energy was divided in the project into production processes and support processes. 11 production processes and six support processes (lighting, ventilation, compressed air, pumps, heating and hot water) were measured in eleven companies. The division into production processes and support processes gives a clear picture of energy consumption, and thus the consumption can be allocated separately for each process (Trygg et al. 2005). A diagram describing energy consumption in the above mentioned way was prepared for each company participating in the project. Two diagrams were compiled: the first diagram was drawn up before performing any measuring activities, and the second one was composed after the measuring activities. Thus, it was possible to compare the initial situation with the situation that would have been possible to achieve for each process and process commodity. The assessment of the visits and the measurements was


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performed by Linköping University together with a group of energy providers from south-east Sweden (Trygg et al. 2005). Processes such as heating, drying, cooling, melting and hot water, processes where it would be profitable to change the mode of energy source, were found among the companies assessed. The processes in question were mainly produced by the help of electricity, while the most effective would have been to change the energy mode for example to biofuel or even to oil. Measurements performed at night, when the production was not running, showed that in many factories the ventilation equipment and the electric motors were running as well as the lights were often switched on in the premises, although, there was no need for lighting. The share of the nightly energy consumption from the total energy consumption of the companies varied in different factories, but stayed within 11–48% (Trygg et al. 2005). In the Oskarshamn's measurements, the largest reduction potential in energy consumption was found in support processes. Among the investigated companies, the share of the support processes from the total energy consumption was 43 GWh/year before the measures were taken and, after the measurement activities, it would have been possible to reduce the energy consumption of the support processes by 28 GWh/year. After taking the measures, the amount of energy consumed by the support processes would be 15 GWh/year. Before the measurements, the division of the total energy consumption between the production processes and the support processes was 52% for the production processes and 48% for the support processes. After the measurements, it would be possible to considerably change the distribution of the energy consumption. The share of the production processes would be 67% and the share of the support processes 33% (Trygg et al. 2005). 4.3.1. Measures of the support processes and their saving potential The support processes have a quite high saving potential. Replacing the compressed air systems and the tools related to them with electrically powered tools would give a high energy saving potential. By this measure the efficiency of the tool could be increased even up to 90% while the normal compressed air would give only the efficiency of 5– 10%. At the Volvo's factory in Olofström, where the compressed air tools were widely used, the measure in question dropped the amount of energy related to compressed air


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from 12.1 GWh to 1.1 GWh which means a 91% smaller energy consumption (Åberg, Gralén, Björk, Räftegård, 2003; Trygg et al. 2005). Concerning lighting the reduction of energy consumption could be achieved by replacing the old luminaires with newer models, and, at the same time, by reducing the number of lamps. By controlling and adjusting the lights, it is also possible to achieve the improvement of the energy efficiency. By the measures related to the lighting, it would be possible to reduce the consumption from 9.9 GWh to 6.9 GWh which means the saving potential of 30%. With measures related to ventilation, the energy efficiency could be improved by reducing the operating times and changing the frequencies. An interesting measure related to ventilation was turning of the fan blades backwards in which case the fan needs less force for rotating. Due to these measures, the energy consumption of the ventilation would drop from 8.4 GWh to 2.8 GWh. The saving in the consumption would be 66% (Trygg et al. 2005). Concerning the pumps, it was noted that many companies had in use over dimensioned pumps that caused excessive consumption compared to the production. By changing the pump frequencies, the energy consumption of the pumps would drop from 5.6 GWh to 4.1 GWh, the reduction thus being 26%. When the production is running, the machines in operation produce themselves heat. If the heating is turned on at the same time, the ventilation and the cooling have to operate with a higher output than necessary. Many companies used electricity to produce hot water, while it would also be possible to use fuels. Concerning space heating and the hot water, it is possible to achieve even a 100% reduction in energy consumption as it is not necessary to keep the heating continuously on in all situations. For the production of hot water, alternative energy sources could be used (Trygg et al. 2005). The largest potential of energy consumption would be achieved with measures related to the compressed air. With measures relating to ventilation, it would be possible to achieve the second largest reduction in energy consumption. It would be possible to achieve the third largest reduction in energy consumption by measures relating to lighting. In the process of hot water making, only a little reduction in the consumption of electricity would be possible to achieve, since the process itself consumes very little electricity. Due to measures related to the support processes, the total electricity consumption could be reduced by 35% in the companies participating in the project. The average possible reduction in the total electricity consumption for the companies participating in the project would be 48% (production processes + support processes)


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and the corresponding figure in relation to the total energy consumption would be 40%. The annual reduction in CO₂ emissions for the companies in Oskarshamn would be 69,000 tons (Trygg et al. 2005). The expenses of the measures varied a great deal. For example, the improvement of lighting does not need large investments; while on the other hand, the changes in the compressed air systems require considerably larger investments. The difference between the investments and the savings is largely influenced by the prices prevailing in the market for electricity, district heating and oil. With following prices, a 4.37 million euro saving could be achieved: electricity 43 €/MWh, district heating 40 €/MWh and oil 78 €/MWh. The expenses related to the connection to the district heating network are not taken into consideration in this calculation. With the help of the measure in question, considerable reduction could be achieved in energy consumption and it was possible to allocate these reductions separately for each process. By reducing energy consumption, the competitiveness of the companies would rise, and the measures would partly help to hinder the transfer of the production of domestic companies to the countries with lower production expenses (Trygg et al. 2005). 4.3.2. Case: Scania AB Next, the Scania’s factory in Oskarshamn belonging to the automotive industry is reviewed. 2,172 workers are employed at the Scania’s factory and the area of the factory is 100,000 m². Before the measurement activities, the total energy consumption of the factory was 70,000 MWh/year. The energy consumption for the area was 700 kWh/m². The total electricity consumption at the factory was 40,000 MWh/year, and oil consumption was 30,000 MWh/year. At night time, when there was no production in the factory, the consumption of electricity was 5,000 MWh/year which was about 13% of the total electricity consumption of the factory. It would be possible to reduce the total energy consumption at the Scania factory by 27,000 MWh/year. After performing the proposed measures, the energy consumption would be 43,000 MWh/year. The energy consumption could be reduced by 39%. The result in question would mean the energy consumption of 400 kWh per square metre. After performing the measures, the total consumption of electricity would be 24,000 MWh. The reduction would be 40%. It was proposed for the Scania factory to give up using oil completely. In this case, the reduction in the consumption of oil would be 100 % (Trygg et al. 2005; 2002, 41–44).


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In the results of the measurement activities performed at the Scania's factory, a remarkably high saving potential in energy consumption was noted. Concerning the lighting, the energy consumption before measures was 6,500 MWh/year. After taking the measures, it would be possible to reduce the consumption to 5,000 MWh/year. The total saving would be 1,500 MWh/year by renewing the lighting with more energy efficient alternatives and by replacing the luminaires. The use of compressed air powered tools at the assembly factories is typical. At the Scania's factory, the energy consumption for compressed before the measures air was 6,000 MWh/year. By replacing the compressed air powered tools with the electrically powered tools, the amount of energy can be more efficiently focussed on the tools. After such electrification, the energy consumption of compressed air would be less than 600 MWh/year. The reduction in energy consumption would be 5,400 MWh/year (Trygg 2002, 41–44). Before making the measurements and taking the measures, the ventilation consumed energy 4,000 MWh/year. By reducing the operation time of ventilation, checking the rotation speeds and taking partly use of free cooling, the energy consumed by ventilation could be dropped to 1,000 MWh/year, which would give the reduction of 3,000 MWh/year compared to the initial situation. At the Scania's factory, a part of the building's heating was powered electrically and consumed energy 1,500 MWh/year. By replacing the electrically operated heating with an alternative system, for example with district heating, the total energy consumption could be reduced. The pumps used at the factory consumed energy in the amount of 2,000 MWh/year. By regulating the pumps and by reducing the idle running of as well as by monitoring their running speeds, the energy consumption could be reduced by 1,500 MWh/year, thus the consumption of pumps would be only 500 MWh/year. The energy consumed to press and fabricate truck moulds was 8,000 MWh/year. By reducing the idle running of machines, the energy consumption could be decreased by 500 MWh/year (Trygg 2002, 41–44). By improving the support processes using electricity, it would be possible to reduce the total energy consumption ca. 13,000 MWh/year. The amount of energy in question will not be completely released for the use in the company, but the reduction in the energy consumption allows transferring the unused potential to other stages of production (Trygg 2002, 41–44). The energy used at the Scania's factory includes electricity and oil. Oil was used for heating the premises 11,000 MWh/year. By taking into use the district heating, the oil


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heating could be removed completely, which would reduce the heating energy consumption by all 11,000 MWh. Previously, also the use of hot water was based on the energy produced with oil, but with the taking into use of the district heating also the amount of energy used for hot water production with oil can be completely given up. The annual reduction would be 1,500 MWh. The giving up of the use of oil would also remove the flue gases produced during the process. The annual volume of gases is 4,000 MWh. By replacing the use of oil with the district heating would give the reduction in the energy consumption of 15,000 MWh/year. In the initial conditions, the company used oil 30,000 MWh/year, and the annual consumption of district heat would be ca. 19,000 MWh (Trygg 2002, 41–44).

4.3.3. Case: ABB Figeholm Bruk AB The second company that was investigated in the Oskarshamn research was ABB Figeholm. This factory produces pressure vessels for industrial use. The area of the factory's premises is 11,200 m² and the annual number of working hours amounts to 5,000. Before performing the measurement activities, Figeholm's total energy consumption was 30,667 MWh/year, which means the energy consumption of 2,738 kWh per square metre. The share of electricity was 11,652 MWh/year and the share of oil 19,015 MWh/year. From the company's consumption of electricity about 14% or 1,642 MWh was annually consumed at the night time, when no production was running, or for the excessive idle operation of machines. After taking the measures, it would be possible to reduce the total consumption of the factory by 30%. After taking the reduction measures, the total energy consumption would be 21,466 MWh/year which would make 1,917 kWh/m². The consumption of electricity would be reduced almost by a half. After taking the measures, the electricity consumption would be 6,185 MWh/year. The consumption of oil would be removed completely, since it would be possible to replace the amount of energy produced with oil by district heating and biofuels. The amount of energy to be consumed by district heating and biofuels would be 15,281 MWh/year (Trygg 2002, 26–29). The saving measures of the ABB factory are mainly focussed on the support processes and the processes related to the systems operating commodities. The lighting of the factory uses electricity in the amount of 729 MWh/year. By installing presence detectors, dividing the lighting into groups and replacing the luminaires, it would be possible to reduce the energy consumption by 324 MWh/year. After taking the


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measures, the energy consumption for the lighting would be 405 MWh/year. Concerning compressed air, the energy consumption was 1,310 MWh/year. By replacing the compressed air powered tools with electrically powered tools, the consumption would be reduced by 1,179 MWh/year. After taking the measures, the energy consumption for compressed air would be not more than 131 MWh/year. The energy consumption of ventilation is 74 MWh/year. By regulating the operation times and the rotation speeds and by using free cooling, the energy consumption of ventilation could be reduced by 52 MWh/year (Trygg 2002, 26–29). Before taking the proposed improvement measures, the premises were partly heated with electricity. Replacing it with the district heating, it would be possible to completely give up the electrical heating. The energy consumption of the electrical heating is 304 MWh/year. The unnecessary consumption of energy at night time and the excessive idle running of machines consumed energy in the amount of 1,642 MWh/year. By monitoring the excessive energy consumption and by reducing the idle running, the unnecessary energy consumption was reduced by 1,598 MWh/year. After taking the measures, this kind of energy consumption would be only 44 MWh/year. The majority of energy necessary for heating the premises was produced with oil. The heating energy consumption was 1,941 MWh/year, and this can be completely given up by replacing it with the district heating and biofuels. By using district heating would cause also little reductions in energy consumption, for example, the hot water would be produced with oil and the corresponding consumption would be 10 MWh/year (Trygg 2002, 26–29).

6. CONCLUSION Energy saving agreements in Finland offers a good possibility for the companies to improve their energy efficiency. The program operates mainly on the companies' conditions, and the umbrella organisations of the energy efficiency agreements do not set any saving targets for the companies. The annual energy saving of the companies participating in the energy efficiency agreements has not yet been very large, but the agreement period will still last until 2016.


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Energy efficiency can be improved in many subsectors, but the largest potential is connected with the support processes. About a half of the measures improving energy efficiency are focussed on the support processes. The initial conditions for the improvement of energy efficiency of support processes is a cheaper alternative compared to the production processes that mainly are the core processes in the company. The specification of possible improvement measures is not worthwhile, since each company is different and needs an individual auditing before taking possible measures. In many cases, the changing of the whole system that needs improvements would give a bigger reduction in energy consumption.

By improving energy efficiency, it would be possible to reduce energy consumption even by 40%. Even a much smaller reduction in energy consumption would considerably decrease the production expenses of companies and their profitability would rise significantly. The contribution to energy efficiency has become an objective for many companies over the past few years and, for example, the improvement of energy efficiency of small and medium size enterprises is not yet a systematic activity. In energy intensive companies, energy efficiency plays an important role in the operations of the company, but irrespective of that, the contribution of many companies to the improvement of energy efficiency remains still minute. To improve the situation of energy efficiency, it would be useful to perform a wide investigation about the energy consumption of small and medium size enterprises in Finland and map the present energy efficiency situation of domestic companies. In Sweden, the research in question is being carried out for the first time after 1990, and this far, the published results show a considerable saving potential. The development of an integrated energy efficiency system is one of the future goals of Enersize Oy, and the results of this thesis will be used for the possible mapping of the system features. In this thesis, I have found answers to questions set by us and, in this respect, I consider the work successful. The thesis has fulfilled its objectives.


Energy efficiency of industry – Present situation and savingpotential of supporting processes