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Understanding lighting subsidies

April 29, 2009
Government-subsidized lighting can be part of a winning strategy.

Presidents and recessions come and go, but opportunities for plant professionals to improve the efficiency of their operations through sustainable and sensible methods are plentiful. In the United States, manufacturing is a most energy-demanding business and, regardless of what a company produces, there’s always potential for improvements and savings.

The most favorable initiatives manufacturing plants can introduce are immediate implementations of energy-efficient methods and cost-saving technologies. Ideally, these implementations are relatively low in cost, with the idea that small modifications and reasonable budgets can result in profitable improvements with short payback periods. Sticking to the basics is the best way to pinpoint which methods can be deployed immediately and which energy-efficient technologies have the quickest paybacks with the largest cost savings.

Evaluate, upgrade and train

The first action you should take is to walk through the plant during an off-shift to monitor how the plant functions when operations are silent. Finding idling mechanical and electrical equipment that can be turned off and finding opportunities to cut water consumption instantly decrease utility bills. Being able to monitor and control what, when and how long a device is operating contributes to instant cost savings that accumulate over time and extend equipment life.

The second initiative you should take involves lighting. Change out inefficient light fixtures and replace them with energy-efficient fixtures and lamps. This produces more rapid cost savings. It’s a technologically simple modification that can be implemented quickly to begin saving money. The high-efficiency light fixtures you’ll install have wider spreads, higher lumen outputs and less power consumption, and are designed to eliminate dirt buildup within the fixture. A plant that replaces inefficient with modern fixtures can significantly reduce energy consumption and maintenance work.

Until relatively recently, it was difficult to advocate for energy efficiency initiatives in a credible manner because so few companies had taken on these improvement measures. As technology and the energy-efficiency knowledge base expanded and grew, industry noticed positive outcomes that led the way to greater improvements and more participation from all industries.


An example of such an undertaking is Harry & David, the Oregon-based fruit-growing, packaging and shipping company. This company used high-efficiency lighting equipment to shrink its annual energy bill. The goals were simple: reduce energy consumption, reduce energy costs, improve light quality and improve productivity.

Harry & David replaced its relatively inefficient metal-halide lights with 825 high-efficiency six-lamp T5 and T8 fixtures controlled by occupancy sensors. This resulted in an estimated annual savings of more than 970,000 kWh and nearly $38,000 in energy costs, which shows what happens when you make a 44% cut in electricity consumption. The total project came in at $344,000, offset by an Energy Trust incentive of $122,000, to make the out-of-pocket cost only $222,000. This yielded a simple payback period of 5.7 years. These estimates were made before any Oregon Business Energy Tax Credits were included. With those tax credits, the payback period could be reduced to within the range of 3.5 years to 4.5 years.

Beyond that time, Harry & David has what is essentially a free lighting system. The company estimates that by investing in energy-efficiency improvements for more than 15 years, it’ll save more than 6,500 mWh annually, thanks to high-efficiency lighting and equipment. This initiative exemplifies how plant owners can undertake planned business energy solution methods and incorporate them into the plant infrastructure to yield successful, energy-efficient implementations.

It’s crucial to have a knowledge base for your facility and have a detailed breakdown of how each device operates. This leads to the backbone behind the third initiative. The best way to monitor each device is with training that ensures the staff understands and controls each piece of equipment in the plant. Additional staff roles and responsibilities, on top of their typical duties, can foster a sense of management and oversight for each piece of equipment. As equipment operating methods become finely tuned over time, overall plant efficiency will increase.

These three basic ideas lead to quick and simple cost savings by providing a respectable decrease in utility consumptions during a period of two years to four years. In addition to cost savings, these simple techniques might lead to tax reimbursements and tax incentives.

Understand subsidies

If you want to pursue a fresh and innovative alternative method to achieving cost savings, look no further than the California Energy Commission (CEC) activities with its Public Interest Energy Program (PIER). Through funding from the Department of Energy (DOE) to the tune of $18 million a year, the PIER program works closely with private and public utility companies to train, research, develop and deploy emerging energy-efficient technologies for industrial water and energy use.

To date, the Industrial Energy Efficiency Program has delivered more than 65 technical training workshops attended by more than 1,500 plant professionals, and conducted nearly 40 industrial plant assessments that identified savings of more than 23 million therms of natural gas and nearly 40 million kWh of electricity, which represents an annual cost savings to California industry of nearly $19 million.

PIER Program Manager Pramod Kulkarni states that bold manufacturing pioneers working with funding from government-backed programs like PIER have led to emerging technologies being incorporated into the daily operations of facilities to produce dramatic, positive results. The results include impressive cost savings, increased tax incentives and reimbursements, reduced energy consumption, increased marketability and rapid returns on investments. Kulkarni says that it can be difficult for a plant manager to volunteer a facility for such bold initiatives, but the results could be ground-breaking for the company and profitable in a short time.

Kulkarni points out that as the United States continues its 2009 investment in sustainable design and funding for innovative technologies and energy efficiency, more such projects will come on line. Tax incentives will increase and positive future outlooks for the success of the emerging technological implementations within the manufacturing plant industry will grow.

The CEC and the PIER program stand alone as the role model for the rest of the United States in demonstrating how a government program is working closely with utility companies and industrial facilities to help reduce costs and improve energy efficiency. Following in its footsteps, manufacturing plants should leap into bold initiatives and work with such programs and their utility companies. Investment in such programs is increasing and the outlook is good. Having the opportunity to use successful innovations, resources, direction and funding of past achievements has never been available to the degree that it is today.

Anatoliy A. Zeltser, EIT, is an electrical engineer at KJWW Engineering in Chicago (www.kjww.com). Contact him at [email protected] and (312) 356-3722.

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