A systematic approach to power chain management
Energy-intensive industries such petroleum-chemical, water/wastewater, pulp and paper and data centers understand that electricity has become a very significant business expense. They also realize that quality power has become even more critical to the day-to-day conduct of their business, and that effective management of the power chain is essential to accomplishing their sustainability goals.
Energy-intensive industries such petroleum-chemical, water/wastewater, pulp and paper and data centers understand that electricity has become a very significant business expense. They also realize that quality power has become even more critical to the day-to-day conduct of their business, and that effective management of the power chain is essential to accomplishing their sustainability goals. Yet power remains one of the last unmanaged areas of the P&L statement in many enterprises, despite the broad ranging and valuable advantages that are available through full-scale management of a company’s usage of electrical power.
Often, the power system is a disparate collection of equipment that doesn’t always work in harmony to deliver the desired level of reliability, safety or operating costs. Because an enterprise’s power system evolves as the business evolves, it can become more complicated, inefficient and harder to manage over time — even as expectations for its performance rise.
Solutions that target an enterprise’s power infrastructure deal with managing the complete electrical power system contained within a manufacturing facility or any other entity where electricity must function without interruption. The power system consists of all of the electrical components and assemblies — from the generation source to the devices using electricity — plus all of the monitors, sensors, communications and computers that monitor, analyze and run them.
Because electricity powers so many 21st-century devices that are extremely sensitive to small power fluctuations, power reliability has become a critical concern. Interruptions of less than one second or minor voltage sags can impact an array of activities, idling workers, stranding customers and bringing business to an abrupt halt.
The cost to businesses is huge. In its 2001 publication, The Cost of Power Disturbances to Industrial & Digital Economy Companies , the Electric Power Research Institute (EPRI) estimates that the U.S. economy is losing between $104 billion and $164 billion a year due to outages, and up to another $24 billion due to power quality phenomena.
The demand for, and reliance upon, electricity has far outstripped the ability of the public utility grid to supply it. Moreover, many power outages and problems occur on the enterprise side — not the grid. Thus, managing the power chain within an enterprise has become vital to the ability to compete in today’s 24/7/365 global economy.
Managing an enterprise’s power infrastructure aligns power issues closely and strategically to five critical enterprise imperatives:
Operating cost efficiencies
Effective use of capital
This system-wide view is applied across the life cycle of the system. For example, up-front design and engineering decisions should be made with an eye toward future requirements for modeling and predictive analysis, for monitoring, and for cost-effective maintenance services.
Initial design and engineering of equipment, as well as the design of systems and subsystems, can play a paramount role in ensuring reliability at the start. A holistic electrical infrastructure can deliver a better alternative than can a disparate collection of electrical equipment.
For example, a diversified industrial manufacturer that promotes effective management of the enterprise-wide power infrastructure designed a cutting-edge distribution system with the industry’s first automatic hot-tie capability, which allows two UPSs to automatically transfer loads from one system to the other whenever necessary. The key to the innovation was a static switch that parallels the actual tie breaker. This system eliminated the need for a dozen downstream static switches, saving $600,000 in capital investment while improving reliability.
To stay up and running, critical systems and infrastructures — the power chain — require constant monitoring and vigilant management. Monitoring and data analysis — conducted onsite or remotely — provide instant visibility, isolating problems and their causes so they may be resolved quickly.
Remote monitoring, predictive analysis
Remote monitoring also has become more cost-effective, thanks to the Internet and to relatively low-cost wireless communications. In some remote monitoring configurations, when sensors detect problems or anomalies, they automatically generate an alert message. Companies have the choice of self-monitoring their equipment, or of tapping the 7/24/365 resources of a provider that has the capability of flagging and authenticating data sent from any location across the globe, evaluating it and then notifying the company and/or automatically dispatching technicians.
The value of monitoring system performance can be multiplied by modeling and predictive analysis. For example, one diversified industrial manufacturer focused on complete power systems helped a U.S. petrochemical plant avoid disaster through predictive analysis. Medium-voltage motors are critical to its continuous process.
When a motor fails — as several have in recent years — the outage costs more than $500,000 in lost production, lost profits, lost product and damaged equipment. When the manufacturer installed its own partial-discharge sensors on each motor and began monitoring them, ongoing predictive analysis of the real-time data revealed that one of the motors was within a few weeks of a catastrophic failure. The plant was able to change out the motor during a scheduled turnaround, and an unplanned outage was avoided, saving $500,000.
Energy maintenance cuts operating costs
To effectively manage a power system, plant managers must approach the situation through a system-wide view rather than as discrete parts, with the goal of optimizing the entire system. This has the potential to contribute to operating cost savings throughout the power chain.
For example, during the initial design stage of a project, the use of a specific breaker in one subsystem, although its cost may be greater than a typical breaker, may eliminate the need for more expensive equipment further down the line. Also, the foresight to include sensors and monitoring capabilities in original equipment can eliminate the costs of retrofitting these at a future date.
Historically, companies have managed energy consumption ad hoc — system-by-system or component-by-component — typically only as needs or ideas arose. Too often, the result has been short-term gains and overlooked potential. Management of the power system as a whole resolves many issues. A power system audit considers precisely where and how power is being consumed and then puts that information to work proactively. This ensures that an organization’s power infrastructure is equipped to operate cost efficiently at every critical point, and that fully experienced experts are continually managing energy issues.
Data show that the reliability of a power system may be three to five times worse than the original design if a system is poorly maintained. Power infrastructure solutions optimize maintenance dollars by combining a high-reliability, preventive and calendar-based maintenance program with performance-based maintenance for the balance of electrical equipment. This ensures that limited maintenance dollars are allocated to the most critical assets.
Effective use of capital
The cost-effective use of capital assets is among the most demanding goals of successful businesses. The high cost of building — or building on — and of upgrading aging facilities continues to be a significant challenge. Optimized capital use runs the gamut from the rapid commissioning of new equipment to life extensions for existing equipment.
Having a single point of accountability delivers the advantages of performance guarantees related to uptime, reduced or eliminated operating and maintenance costs and increased availability of capital funds previously spent on non-core assets.
Personnel safety and compliance are paramount issues in any organization. Focusing on the entire power infrastructure with solutions that encompass all three requisites: prevention, protection and preparation, is key to the success of the enterprise.
Prevention reduces the need for people to interact with dangerous electrical hazards. Protection helps make equipment safer through design and/or safeguards. Preparation includes safety studies to identify risks and the necessary training for those who interact with equipment.
Arc flash hazards have emerged as one of the most critical safety issues, affecting literally every person involved in installing, maintaining and troubleshooting electrical equipment. In the face of fewer resources and restricted budgets, cost-effective compliance with the latest arc flash safety requirements is a challenge that requires experts who have extensive experience in real world operations and a complete familiarity with all the standards.
Solution providers must have a comprehensive understanding of the separate industry standards required by OSHA, IEEE, NFPA and the NEC — as well as OSHA’s six-point compliance plan.
For an existing facility, power system solutions begin with an engineering model that identifies the worker hazards and ensures all electrical equipment is labeled to indicate the proper protective clothing for electrical workers in accordance with the consensus standards. From there, expertise and technology are applied to install engineered arc interruption solutions that can reduce hazards and associated risks to optimize the electrical safety of the facility.
Risk mitigation, single point of accountability
A single point of accountability, as well as depth of expertise, improves risk management in terms of uptime risk, cost risk, safety risk and time risk. This ranges from minimizing the risks of construction delays to managing the risk of downtime from power outages or quality anomalies. With a provider that is coordinating diverse activities, enterprises gain improvements in such cost risks as managing multiple vendors, integrating disparate systems, and unexpected needs for additional labor.
An enterprise that adopts this new management approach will strengthen its ability to compete. In a company with global entities and many points of criticality, management of the entire power chain can produce tens of millions of dollars a year in savings by closely aligning power solutions with business strategies. Managing the power system holistically will ensure that each portion of an enterprise has the level of power reliability, safety, asset and risk management and operating cost control that it needs.
Author Information Mike Longman is vice president of marketing and Power Chain Management for