Benchmarking Sectors and Certifying Industrial Plants Presented by: - PowerPoint PPT Presentation

Benchmarking Sectors and Certifying Industrial Plants Presented by: Gale Boyd PhD, Duke University & ENERGY STAR Benchmark Developer

Information is a Common Barrier to Efficiency Is 10 MMBtu per vehicle for Is 10 MPG for a 2-door a plant that makes the economy car high or low? 2-door economy car high or low? Answer: Common Knowledge Answer: ?

Estimating the “Energy Efficiency Gap” Engineering models can estimate best practice, while statistical models are typically average practice. – Measures of energy intensity based on averages are of limited use in managing energy use or goal setting. – Averages can only tell us if we are above (or below) but not by how much. – A more useful measure represents where a company or plant lies within a distribution of peer performance. “Is my performance close (or far) from the industry best practice?”

Plants Within Industries are Not All the Same

Energy Star Energy Performance Indicator (EPI) • The EPI is a statistical model of plant energy use • Since “plants are not all the same” a statistical model is used to make an “apples to apples” comparison. • Statistical models can - – Relate energy use to production activities • Primary business of a manufacturing plant • Incorporate the specific type or mixture of products – Include external factors that influence energy use • Variation in materials arising from upstream integration (make vs buy) • Capacity and utilization • Heating and cooling loads driven by geographic location

What are the Basic Inputs to an EPI? • Plant level total primary energy (TPE) – Total BTU’s (GJ) of fuels – kWh of electricity purchased from the grid is converted to BTUs (GJ) at average power plant thermal efficiency • Production activities are captured by: – Production - Level and Mix • “Levels” may be flows of common inputs, products shipped, labor hours, or a combination. • Mix are typically shares of different products with dollars or physical units as the denominator – Capacity and utilization – when data are available • May include industry specific factors – Input mix – Upstream integration – Climate (e.g. HDD and CDD)

Example of an EPI Input Screen Nitrogenous Fertilizer Plant Energy Performance Indicator Draft Version 1.1, Release XX/XX/2018 Plant Characteristics Current Plant Reference Plant Enter Name Enter Name NAICS Code: 325311 Year: 2016 2015 ZIP or Postal Code: 27705 Choose US or International Units: US Units Location: Durham, NC Ammonia: 150,000 short tons 0 Production of Final Sold Product 30-Year HDD (deg F): 3,457 Urea: 200,000 short tons 0 30-Year CDD (deg F): 1,417 Ammonium Nitrate: 120,000 short tons 150,000 UAN: 500,000 short tons 250,000 MAP: 0 short tons 0 DAP: 0 short tons 0 Other Production Notes Other Product Value Share: 5% % ($/TVS) 25% Details Ammonia Producer: yes yes/no no Urea Producer: yes yes/no no Ammonium Nitrate Producer: yes yes/no yes Phosphates Producer: no yes/no no Production Worker Hours: 200 1000 person hours 100 Energy Consumption Electricity Onsite Renewables Gas** Distillate Oil Residual Oil Coal Other Select Units Enter Name Annual Purchases & Transfers 600,000 1,300,000 Annual Cost ($)* Enter cost Enter cost 2016 Enter Name Annual Purchases & Transfers 70,000 20,000 2015 Annual Cost ($)* Enter cost Enter cost * Entering cost data is optional and does not impact the computation of the Energy Performance Score. **Do not include natural gas purchased as a feedstock; only include natural gas used for heat and power.

Example of an EPI Results Screen Results Your Current Plant Your Reference Plant Average Plant Efficient Plant Enter Name Enter Name Enter Name Enter Name Display energy results in: US Units 2016 2015 2016 2016 76 46 50 75 Energy Performance Score (EPS) Source Energy (MMBtu) 7,793,208 770,958 10,375,841 7,835,307 Site Energy (MMBtu) 3,347,200 258,840 4,456,447 3,365,282 Annual Energy Cost ($/year) $0 $0 $0 $0 403,800 126,000 403,800 403,800 Total Production (short tons of N)* Energy Cost/Total Production ($/short $0.00 $0.00 $0.00 $0.00 tons of N)* Energy Intensity (Source MMBtu/short 19.30 6.12 25.70 19.40 tons of N)* *Production units in the Results section match those selected in the above Plant Characteristics section. Enter Name (2016) Enter Name (2015) 100% 100% 90% 90% EPS = 46 EPS = 76 80% 80% 70% 70% 60% 60% 50% 50% 40% 40% 30% 30% 20% 20% 10% 10% 0% 0% 0 5000000 10000000 15000000 20000000 25000000 30000000 0 500000 1000000 1500000 2000000 Source Energy (Million Btu) Source Energy (Million Btu)

A Variety of Data are used in EPI Industry Studies Focus industries Product mix Units Inputs Size or capacity Climate Other Cement 3 Product Types Tons - Capacity & # of Kilns Person hours Corn Refining 5 Product Types Bushels Corn Capacity Feed moisture Dairy - Fluid Milk * 6 Product Types Gallons Whole milk - CDD Person hours Dairy - Ice cream * 4 Product Types Gallons 2 types - CDD Person hours Ethyl Alcohol ** Single Gallons - - - - Food - Juice 8 Product Types Gallons 2 types - - - Food - Frozen Fried Potatoes Single Pounds - - - Warehouse (frozen) Food - Tomato products ** 2 Product Type 2 types - - Person hours Baking - Cookies & Crackers 3 Product Types Pounds - - - - Baking - Bread & rolls 5 Product Types lbs Raw dough - HDD, CDD Freezers Glass – Flat Single Pounds Sand - - - Glass – Container Single - Price Pounds Sand, Cullet - - - Iron and Steel - Integrated 4 Stages *** Tons - Furnace capacity - Iron and Steel – Minimills * Single - Price Tons Scrap Furnace capacity - - Person hours Metal casting - Iron 4 Product Types - Price Tons - HDD - Person hours Metal casting - Investment steel * Single $ Value - - Metal casting - “Other” steel * 3 Product Types $ Value - - - - Metal casting – aluminum 3 Product Types - Price Tons - - HDD - Motor Vehicle - Assembly Vehicle Size Number of Vehicles - Production Capacity HDD, CDD Air Tempering 5 Product Types Tons of N - Capacity - Person hours Nitrogen Fertilizers Vehicle Powertrains - Motors 5 component types # of engines - Facility size (ft2) HDD, CDD Vehicle Powertrains - Transmissions Single # of transmissions - Facility size (ft2) HDD, CDD Pharmaceuticals 3 Activity Types **** Share of Floor Space - Facility size (ft2) HDD, CDD Operation hours Printing - Lithograph ** 6 Product Types $ Value 6 types - HDD, CDD - Pulp Mills 3 Product Types Tons 2 types - - Water treatment Water treatment, Paper & Board Integrated Mills 3 Product Types Tons 3 types - - Bleaching chemicals Ready Mix Concrete ** 2 Activities Tons, Miles - - - -

A Variety of Methods & Results Embody the EPI 75 to 50 th Focus industries Statistical Model Year # of plants Data source Returns to Scale Cement log normal (heteroscedastic OLS) 2000-2008 96 Industry VSR 0.92 LR -6.1% VSR Constant LR Corn Refining half normal frontier 2004-2009 37 -14.5% Industry Dairy - Fluid Milk * log normal OLS 2002 258 CM 0.85 -29.0% 1.05 Dairy - Ice cream * log normal OLS 2002 89 CM -23.9% Ethyl Alcohol ** log normal OLS 2007 111 CM 0.70 -35.4 Food - Juice log normal OLS 2002 44 CM 0.84 -41.8% Food - Frozen Fried Potatoes log normal OLS 2002 27 CM 0.91 -16.0% Food - Tomato products ** log normal OLS 2002 40 CM 1.11 -43.7% Baking - Cookies & Crackers log normal OLS 2002 64 0.71 -30.9% CM Baking - Bread & rolls log normal OLS with Kernel 2010-2012 135 Industry 0.78 -15.8% Variable Glass – Flat log half normal frontier 2002 38 CM, MECS -16.3% Glass – Container log normal OLS 2002 62 CM, MECS 1.03 -11.6% Iron and Steel - Integrated log exponential frontier 2005-2012 14 Industry 0.72 SR 0.99 LR -4.5% Iron and Steel – Minimills * log normal OLS 2002 39 CM, MECS VSR Constant LR -12.1% Metal casting - Iron log normal OLS 2006 83 CM, MECS 1.06 -23.2% Metal casting - Investment steel * log half normal frontier 2007 51 1.03 -32.8% CM Metal casting - “Other” steel * log normal OLS 2007 59 CM Variable -25.8% Metal casting – aluminum log normal OLS 2007 290 CM, MECS 1.05 -28.3% VSR Constant LR Motor Vehicle - Assembly Gamma frontier 2003-2005 33 Industry -21.4% Nitrogen Fertilizers* log normal OLS 2002-2012 NR CM Constant LR -24.4 Vehicle Powertrains - Motors log normal OLS with Kernel 2010-2012 23 Industry Constant LR -17.9 Vehicle Powertrains - Transmissions log normal OLS with Kernel 2010-2012 13 Industry Constant LR -23.3 Pharmaceuticals log half normal frontier 2004-2006 61 Industry VSR 0.98 LR -30.1% Printing - Lithograph ** log half normal frontier 2007 775 CM 1.0 -35.0% Pulp Mills log normal OLS 2002 28 CM, MECS 1.05 -36.1% Paper & Board Integrated Mills log normal OLS 2002 99 CM, MECS 0.71 -19.5% Ready Mix Concrete * log normal OLS 2008-2009 62 Industry 0.83 SR 0.89 LR -35.5%

Performance & EPI Changes Over Time 100 90 Total reduction Average annual change 13.0% 1.2% 80 Energy Performance Score 70 60 50 1997 Distribution of U.S. Cement 40 Manufacturing Plant Efficiency 30 20 2008 Distribution of U.S. Cement 10 Manufacturing Plant Efficiency - 3.000 4.000 5.000 6.000 7.000 8.000 9.000 10.000 Million Btu Source Energy per ton of Clinker