Energy Efficiency Consideration in Business: A Business Manifesto

WHITE PAPER Energy EďŹƒciency Consideration in Business: A Business Manifesto

From: CamďŹ l Farr Date: November 2012

Energy Efficiency Consideration in Business – A Business Manifesto Article by Kit Oung

I first met Kit Oung at a BSI workshop in July, we were both invited speakers. Kit’s role as a leading energy academic and author was to deliver the energy landscape, mine was to demonstrate that energy management was indeed a catalyst for growth. We both share a passion to educate absolutely everyone about energy management and energy saving. I suppose you can call us Energy Evangelists. Kit has kindly written this white paper Energy Efficiency Consideration in Business – A Business Manifesto – Enjoy!

Bill Wilkinson, Managing Director Camfil UK

Being green or being sustainable has gained much ground in recent years. There are a lot of renewable technologies and “low energy” technologies available to support companies and public bodies to become greener. These range from the simple LED lighting, wood chip boilers, solar power and solar hot water systems to the high end wind turbines and waste digesters.

Companies investing in renewable energy will no doubt need to prove the green credentials. There are also a lot of service providers willing to testify how green companies and public bodies are. Some of these are ISO standards such as sustainability standards, energy and environmental management systems, resource reduction verification certification and guarantees of origins.

Governments and industry groups are also promoting the implementation of green technologies.

There are many legislations and incentives to implement renewable technologies.

Some

government departments are also embarking on reducing red tape and accelerate the planning processes to facilitate the roll out of green technology.

These are all good opportunity to reduce CO2 emissions.

Many companies have seized the

opportunity and invest in low carbon technology. LED lighting, solar power, solar hot water, wind turbines, heat pumps, and biomass boilers are very visible statement of being green. These types of project have much longer return on investments, typically ranging from six years to more than 15 1|P a g e

years. As such, companies should also be congratulated for breaking away from the traditional mind set of short- to medium-term financial gains and looking towards long term goals.

However, for each chosen low carbon technology, the strategy to implement them can increase or reduce the cost per tonne of CO2 abated. The lowest cost per tonne is by implementing energy demand reduction before low carbon technologies.

Some companies have implemented these technologies without (or forgotten about) reducing energy consumption. There are many examples where executives are interviewed on their low carbon technology in the news where the background shows employees working bright day light yet all of the lights are left ON.

Other examples are:

1. Installing wind-turbine powered light without turning the light off during day time 2. Installing water sprays for cleaning instead of24/7 running water. However washing only occurs for 2 hours/day 3. Installing low pressure drop filters on a ventilation system running at 10 air change when the application only needs 4 air change 4. Installing heat pumps without minimising the required air flow down 5. Installing new CHP plants without minimising the heat and power consumption

Are companies and public bodies focusing too intently on implementing low carbon technologies and lost sight on the quickest and lowest cost method to reduce carbon footprint? Is there any place for the old adage: reduce, reuse and recycle come into play in the low carbon economy? Does it make business sense to invest in green before reducing energy consumption?

Let’s consider the economics of lighting carbon footprint of a typical office building in Central London. This building is upgrading all of their existing T12 lighting. There are 100 light fittings; each fitting contains two 4ft fluorescent. The office is occupied 14 hours a day, 7 days a week. The lights are left ON 24/7 and consume 8kW of electricity. The electricity to light the building costs £6,475 per annum and emits 32 tonnes/year of CO2.

Four possible implementation strategies are available:

2|P a g e

Implementation Strategy

(1)

(2)

(3)

(4)

Use the same lighting by using occupancy sensors to turn off when not in use

Replace with T5 4ft twin lighting with integrated PIR

Replace with LED lighting

Replace with LED lighting powered by wind turbine

40,768

49,562

53,226

53,226

18

22

24

32

£10k

£20k

£23k

£162k

2.65

4.37

4.67

25.02

£545

£897

£970

£5,137

Electricity Saving (kWh/yr) CO2 Abated (te/yr) Capital Cost (£) Simple Pay Back (Years) Cost of Abated CO2 (£/te)

1. By simply turning off the light when they are not necessary gives the largest savings of 18 tonnes of CO2. Naturally, if the company decides to apply “the discipline” and turn off the lights at the end of each working day, e.g. the last one out to turn off the light, there would be zero capital cost involved.

2. For an incremental of four – six tonnes of CO2 savings, replacing the lighting with alternative lighting technology would cost an additional £400 per tonne of CO2.

3. The interesting fact is that to save the final eight tonnes of CO2 would require an incremental cost of £4,167 per tonne of CO2.

As responsible managers of the environment and as managers of company resources, energy reduction gives the biggest CO2 reduction and the lowest cost per tonne of CO2. These opportunities should be thoroughly exploited before considering installing low carbon technologies for the business.

3|P a g e

The energy management industries have been, to a large extend, dominated by the concepts developed by Frederick Taylor, who championed the scientific methods for manufacturing – management by data. Focusing purely on technical energy management and applying technology has its challenges and drawbacks.

Frederick Taylor left a clue: “I was a young man in years but I give you my word I was a great deal older than I am now, what with the worry, meanness, and contemptibleness of the whole damn thing. It is a horrid life for any man to live not being able to look any workman in the face without seeing hostility there, and a feeling that every man around you is your virtual enemy.”

Extracted from James Brown. 1963. The Social Psychology of Industry. Pelican Press.

Involving the efforts of colleagues and employees is important. In fact, Ken Iverson, the former CEO of Nucor Steel, says that technology contributes only to 30% of the company’s success. People and organisational culture is the remaining 70%. If employees are engaged and get involved, many of the opportunities to increase energy efficiency and reduce energy consumption will have no or minimal capital costs.

According to McKinsey and Co, if companies were fully engaged in boosting energy productivity the continent as a whole could hold energy demand at 2008 levels. Most energy efficiency in industry is achieved through installation of new technologies in an industrial facility, rather than through changes in how energy is managed. However, they are achieving only a fraction of the sizable energy reduction opportunities promised by innovation.

The economics for reducing carbon footprint favours energy reduction strategies before low carbon technologies. Companies wanting to reduce carbon footprint should first and foremost look for opportunities to reduce the quantum of energy consumed. Very frequently, the most obvious energy reduction opportunities are the easiest to be overlooked. Some of the examples are: 

Lighting



Excessive ventilation compared to demand



Simultaneous heating and cooling



Idle time in production



Generation of graded or waste products



Poorly executed maintenance and subsequent re-failure etc.

4|P a g e

The knock on effect of energy reduction are also numerous. For some companies, turning down the air supply could make the work place much quieter and therefore avoiding the need to provide ear muffs to dampen down the noise. In other companies, minimising the need for excessive heating or cooling could result in a smaller and more efficient boilers or chillers to be used. Reducing the energy consumption of plant machinery could also reduce the wear and tear of that equipment, prolonging the time between maintenance.

With many people solutions having no or little capital cost, it gives the highest return on investment – a possibility too good to ignore by professional managers and engineers alike.

From Camfil Farr It is considered that up to 50% of a building’s energy consumption originates from Air Handling Plant – of which filters and pre-filters form one element. Regarding energy efficiency and filters, the greater the pressure differential there is across a filter, the greater the energy consumed.

Camfil Farr are providers of Low Energy Air Filters. As such, both particulate efficiency and energy efficiency are considered as key performance criteria. Camfil Farr are keen to work with clients to develop savings reports that specify the level of savings actually made from their filter installations – over a period of time not just the initial installation.

Technology providers, facilities managers and end clients are keen to know what the energy savings have actually been at their sites. Vitally also, when the optimal time to change a filter might be in order to keep maintaining low energy costs and particulate efficiency and therefore a healthy building environment. __________________________________________________________________________________ About the Author Kit Oung is a practicing energy consultant specialising in energy and carbon reduction strategies using low-cost high-return opportunities and energy management systems. He has 15 years' experience in energy auditing and implements energy reduction projects for blue chip multinational companies including petrochemical, specialty chemical, pharmaceutical, food and beverage and large commercial properties across five continents. Kit is a British Standards Institute expert where he regularly reviews and provides inputs to various energy and environmental standards. He chairs two international standards committees to developing energy auditing standards. His books, Energy Management in Business: The Manager’s Guide to Maximising and Sustaining Energy Reduction (Gower Publishing) is available from Jan 2013. He is co-writing a second book to help businesses embarking on an energy management system. This book will be available from British Standards Institute in 2013.

5|P a g e

Kit, a Chartered Energy Management, Chartered Chemical Engineer and member of Chartered Management Institute, graduated from the University of Sheffield in 1997. In 2011, he completed both the General Management Certificate and the Professional Service Firm Leader from Judge Business School, University of Cambridge.

Linkedin: uk.linkedin.com/in/kitoung The book ‘Energy Management in Business’ by Kit Oung is available on Amazon: http://www.amazon.co.uk/Energy-Management-Business-MaximizingSustaining/dp/140945245X/ref=sr_1_1?s=books&ie=UTF8&qid=1350646851&sr=1-1

About Camfil Farr Camfil Ltd is the UK subsidiary of Camfil AB which trades as Camfil Farr or the Camfil Farr Group. Camfil Farr is a world leader in the development and production of air filters and clean air solutions. Camfil Farr is also one of the most global air filtration specialists in the world with 23 production units and research and development centres in four countries in the Americas, Europe and the Asia-Pacific region.

Camfil Farr, headquartered in Stockholm, Sweden, has approximately 3,350 employees and sales in the region of SEK 4.6 billion (c. £440 million). International markets account for almost 90% of sales. The company’s business is to provide customers with sustainable best-in class air filtration products and services within four main segments: Comfort Air; Clean Processes; Power Systems; and Safety and Protection.

With 49 years of experience in air filtration products and solutions, Camfil Farr delivers value to customers all over the world while contributing to something essential to everyone – clean air for health, wellbeing and performance.

See: www.lowenergyairfilter.co.uk and www.camfilfarr.co.uk

6|P a g e