The start of a new year is a time to reflect on the past and look into the future. This is a particularly interesting time for energy. In 2007, we’ve seen a growing awareness of the crucial and rising impact of energy security, cost and pollution, to the success of our companies, our economy and our communities.
This visibility is a welcome change, but much of the current energy discussion is disjointed and has shades of “magic bullet” thinking. It focuses on isolated actions and technologies, and rarely captures the benefits of integration discussed so many times in this column. When companies, communities and even entire countries or regions consciously put together programs to educate and reward people and implement end-use efficiency measures, heat recovery, efficient energy distribution and lower-carbon fuel choices, the results are breakthroughs in energy productivity. These breakthroughs fundamentally change the economic, political and environmental playing field for energy.
In the industrial context, one of the most obvious areas is heat recovery. I never fail to be amazed by the frequent assumption that the massive amounts of heat produced as a byproduct of industrial processes and generating electricity is nothing more than a waste product to be eliminated with costly cooling towers using vast amounts of valuable water.
One of my industrial clients has declared 2008 to be the year when heat recovery will be a major strategic focus, recognizing the value of the millions of dollars wasted on valuable fuel. A group of senior operational managers from the United States and Europe recently gathered in Germany, a country that has long recognized the value of heat recovery in both industry and community. In a couple of days, they were updated on different heat-recovery strategies, technologies and management approaches. By the end of the two days, the group not only had gained some new knowledge, but had developed a lengthy list of possible heat-recovery and cogeneration actions that collectively will save a significant amount of money. Heat recovery strategies generally also create over-proportional reductions of greenhouse gases, a major factor in an increasingly carbon-conscious world.
What mainly caused me to think of this event in the context of some year-end reflections was the visit we made on the third day to the Gersthofen Industrial Park near Augsburg in Bavaria. An integrated past is ever-present at the industrial site, founded in 1900 by Hoechst to take advantage of integrating run-of-river hydroelectricity with canal transportation.
During the past century, it has evolved into an industrial park that is home to 12 separate companies and facilities. However, rather than each of these facilities being an independent “energy island,” Gersthofen Park gives us a glimpse of the benefits that can be gained by energy integration.
Energy services are provided by a dedicated company that all the factories on the site use. This company, an affiliate of MVV Energie, the city utility in Mannheim, provides electricity and gas, as well as process steam, heating, compressed air, oxygen, water and wastewater, along with security, site rail transportation and other services.
The high level of integration results in lower costs, reduced pollution and greater reliability. It also is easier to adapt the service mix to accommodate changing end-user needs and available technologies. Duplication of equipment and staff is minimized, further reducing the overall cost and environmental footprint.
Efficiency also is part of the offering, with tenants and the service company meeting regularly to review and implement recommendations from any of the 1,600 employees or 12 companies on the site. These are rewarded with cash payments equal to at least 10% of the annual savings for the individuals or teams concerned.
This level of integration doesn’t happen by chance. It requires a slew of changes in management attitude, utility and municipal regulation, acceptance of new operating practices and implementing unfamiliar technical approaches. However, this 100-year-old industrial site has evolved from a late 19th century to a 21st century example of the clear benefits of energy integration, and remains globally competitive in an increasingly carbon-constrained world.
Industrial energy productivity strategies will increasingly demand the rational integration of efficiency, heat recovery, cogeneration, renewable and traditional energy sources in a single seamless approach. Will 2008 be the year when you accelerate the implementation of these approaches in your plants?
Peter Garforth is principal of Garforth International LLC, Toledo, Ohio. E-mail him at email@example.com.