The quest to standardize energy management processes

Newly formed industry group aims to boost U.S. manufacturing’s global competitiveness through energy efficiency.

By Sidney Hill, Jr. December 12, 2012

As industrial energy management becomes a mainstream movement, the push to establish standards in this realm will gain momentum as well. Already, groups are collaborating on everything from best practices for launching energy management programs to the development of communications protocols for integrating energy management devices from different vendors.

Speaking of best practices, the U.S. Dept. of Energy (DOE) is launching a program through which industrial companies can gain official certification that they have made exceptional strides in improving energy efficiency. The DOE’s Superior Energy Performance (SEP) program will award companies Silver, Gold, and Platinum designations based on their documented levels of increased energy efficiency over a given three-year period.

While the DOE created the program, a newly formed group called the U.S. Council for Energy Efficient Manufacturing (U.S. CEEM) is taking the lead in promoting the program within the manufacturing community. U.S. CEEM elected its first slate of officers this past October.

The new chairman is Fred Fendt, whose regular job is Global Manager of Energy Efficiency and Conservation for the Advanced Materials Division of the Dow Chemical Company. He spoke with Control Engineering about how the SEP program and U.S. CEEM can help individual companies become more energy efficient while also boosting the global competitiveness of the entire U.S. manufacturing sector.

CE: Please explain the origins of the U.S. Council for Energy Efficient Manufacturing. How did it get started, and what are its primary goals?

Fendt: The effort started with the Dept. of Energy’s Superior Energy Performance program, or SEP. In a nutshell, SEP starts with the ISO 50001 standard, which is a methodology for making sure a company’s energy management program is documented, repeatable, and transparent. It then adds requirements for establishing a baseline for a company’s current energy usage and then showing continuous improvement over a number of years. Those two elements added together make up the SEP program.

CE: You’re the newly elected chairman of the council. How did you get involved with this organization? 

Fendt: I worked with a group of people from other companies and industries to develop both the ISO 50001 standard as well as the SEP program. We realized that when SEP was to be rolled out to industries-which is happening now-that we would need a steering group to provide a consistent voice to industry, talking about the efficacy of the program and providing feedback information to the program’s administrators about how well the program was working and what could be done to make it more effective. That was the beginning of U.S. CEEM.

Once we formed the organization, we quickly realized that U.S. CEEM had a lot of value beyond just promoting SEP. In my mind, U.S. CEEM is unique for two reasons:

  1. It covers every industry that uses energy-automotive, chemical, glass, steel, food manufacturing, etc.
  2. It’s not focused on policy issues. It focuses on the technical impact of energy management programs on the member companies. It will evaluate how much energy management programs actually improve energy efficiency within companies, and then report that information to the membership.

CE: In a presentation to a group working on ANSI standards for energy management, you mentioned that one of U.S. CEEM’s primary functions would be defining industry goals and objectives related to energy management. Have you identified the manufacturers’ primary energy-related needs? And what goals and objectives should companies look to achieve when it comes to energy-efficient manufacturing?

Fendt: We’ve begun that process. Many of the elements of the ISO 50001 standard and the SEP program reflect conversations we’ve had with industry representatives about what they want to accomplish by practicing energy efficiency. One thing we learned through those conversations is that energy efficiency is not necessarily the same thing to all industries. For instance, I work for Dow Chemical. Our definition of energy efficiency is going to differ somewhat from that of General Motors or Weyerhaeuser or an electronics company, simply because the nature of their businesses is different.

U.S. CEEM wants to make sure that any methodologies we adopt for measuring energy efficiency can be applied across industries. That is likely to be our biggest challenge.

CE: When you look at ISO 50001, which is the foundation for SEP, does it not address the nuances of different industries as they relate to energy management?

Fendt: Generally, ISO standards don’t tell you how to conduct processes. They tell you how to document and manage processes that you develop on your own. The idea is to have a manual that will allow an outside party to come in and go down the checklist to validate that you are actually adhering to the processes you’ve created.

ISO standards don’t address process improvement. In my mind, that’s why SEP was needed. SEP tells companies that while you’re following the ISO 50001 requirements, which mean establishing energy management processes that are documented, repeatable, and transparent, you also should establish a baseline for your energy usage and develop methods for continuous improvement relative to that usage.

If a company simply adopted ISO 50001 alone, it could have an energy management program that was completely standardized, documented, and repeatable, but it wouldn’t reduce its energy use. In fact, over time the company probably would increase the amount of energy it uses, while remaining fully compliant with ISO 50001 because that program was not driving the right behavior.

The SEP program offers companies the best of both worlds. It says do ISO 50001, which gives you a method for creating standardized processes, but also adds the dimension of forcing you to look at ways of actually improving energy efficiency.

CE: With that in mind, are you forming industry subgroups to help companies determine how to best drive energy efficiency within their specific businesses?

Fendt: I don’t think we’ll have specific industry subgroups, particularly in the near term, because the organization is not that large. There are currently only 15 to 20 member companies.

We have looked at the DOE’s Manufacturing Industry Consumption Data lists to see which industries use energy in the U.S., and we’re trying to recruit members from that list. We have been successful in recruiting companies from a broad cross section of industries-from food manufacturing to steel, pulp and paper, automotive, and electronics. Our goal is to represent all U.S. industries that use energy.

We envision ourselves being more like a user group that you would see in the IT field, except it would be for energy management professionals. For instance, I’m in the chemical industry. If my company decided to put in a heat exchanger that uses technology we don’t have experience with, we may find someone in this group from the paper industry who has used that same type of exchanger for years. We can tap into their expertise to make our transition to that new technology easier. With that type of knowledge transfer taking place, everybody wins because everyone becomes more energy efficient.

CE: There are different levels of SEP certification. What do you measure to determine if a company is at the Silver, Gold, or Platinum level?

Fendt: The SEP documentation is very specific about the calculation procedures, as well as the measurement and verification procedures. You define the area you’re going to work with for purposes of certification-whether it’s an entire site, one particular plant within the site, or just an operation within a plant. You define where you’re drawing the box. Then you define the specific energy usage you’re going to manage within that box. Is it just steam? Is it just electricity? Or is it all energy coming across the fence line? Once you determine those parameters, you establish a baseline of how much energy is being used within that box before you implement an energy management program.

When your program is in place, you measure your progress each year against that baseline. A 5% improvement from the baseline will earn a Silver designation. A 10% improvement nets a Gold designation, and Platinum requires a 15% improvement from the baseline. Typically, three years will be the time period for measuring improvement. However, there have been some pilots in which measurements were taken after one or two years for purposes of validating the process.

CE: What were the results of those pilots?

Fendt: The most extensive pilots were conducted in conjunction with an organization called Texas Industries for the Future. They have posted case studies from some of those pilots on their website. (See Pilots demonstrate superior performance below for more information on these projects.)

CE: How can SEP and U.S. CEEM help boost overall U.S. manufacturing competitiveness?

Fendt: U.S. CEEM will help manufacturers become more competitive by promoting energy efficiency. Energy costs money. So, when manufacturers reduce energy use, they are reducing the cost of manufacturing goods, which makes them more competitive.

SEP will help manufacturers achieve energy efficiency first by giving them the tool of ISO 50001 to create structured, regimented energy management programs. I’ve always told my colleagues at Dow Chemical that if you’re going to have an energy management program in your plant, you might as well do it against ISO 50001, because it will ensure that your program has a solid structure. Adding the SEP part-establishing an energy usage baseline and measuring improvement by open and transparent calculation methods-provides a level of credibility outside of the company, especially if you can report a continual stream of improvement over a number of years.

That helps when working with customers that require certain levels of energy efficiency, which is a growing requirement across supply chains.

Sidebar: Pilots demonstrate superior energy performance

The tales of two companies illustrate how the Superior Energy Performance (SEP) Program can drive energy efficiency across multiple industries. Cook Composites and Polymers Co. and Freescale Semiconductor operate two of five Texas-based plants that piloted the SEP program from 2008 to 2010. The pilots were monitored by an organization called Texas Industries of the Future, which was established in 2001 with funding from the U.S. Department of Energy.

The DOE chose to fund projects in Texas because that state ranks first among U.S. states in industrial energy use, consuming 19% of all energy used in industrial settings across the country. Texas Industries of the Future is charged with facilitating the development, demonstration and adoption of advanced technologies and best practices for reducing industrial energy usage, emissions and costs. The overriding goal is making Texas-based companies more competitive.

There’s also an expectation that strategies that show success in these Texas demonstration projects can be spread to companies across the U.S. And SEP’s track record in Texas pilots has led to that program now being rolled out nationwide.

In one pilot, Cook Composite and Polymers deployed the SEP program in its Houston-based plant, which supplies synthetic resins to the composites and coatings industry. This plant was chosen because it had been experiencing dramatic increases in annual energy costs. In 2008, energy accounted for 20% of the plant’s operating budget.

When Cook adopted SEP, two of the plant’s major energy-consuming systems were targeted for projects to improve energy efficiency. Two years later, these systems were using 14% less energy and the plant had earned SEP Gold Certification.

Though they are in a completely different industry, the Freescale Semiconductor Fabrication plant in Austin, Texas, registered similar results with SEP. Following roughly the same process as Cook, Freescale reduced its plant’s annual electricity consumption by 28 million kilowatt hours and its natural gas consumption by 26 million British thermal units over a two-year period. That cut the plant’s energy bills by more than $2 million a year and earned the facility the SEP Silver Certification.

Both plants also now have programs in place to continue improve their energy performance in the future.

Learn more about the Superior Energy Performance Program.

To learn more about the U.S. Council for Energy Efficient Manufacturing, follow this link:

To read the full case studies on these projects, visit the Texas Industries of the Future website.