Plant Engineering Energy Study: Less than half of manufacturers conduct energy audits
Energy is the largest cost area for many manufacturers, yet fewer than half of manufacturing facilities conduct even an annual energy audit. That is the key finding from Plant Engineering’s recent research study of U.S. manufacturers. The full report is now available here.
The survey found that just 47% of facilities conduct even an annual energy audit of their plants. While just over a quarter of those respondents perform an energy audit annually, only 5% conduct an audit twice a year, and 9% conduct an audit quarterly.
"Energy is a raw material, like steel, plastic, and other materials that go into making a finished manufacturing product. We think it is unlikely manufacturers would not audit the materials that come into their facility. Yet that appears to be happening with energy in many plants in America today," said Plant Engineering content manager Bob Vavra. "Manufacturers who do not understand their energy usage in all areas are missing a huge opportunity to better manage their overall costs and deliver greater savings and profits."
Plant managers cite a lack of management support—including financial support—as the primary challenge in building an energy management program. The survey found 33% of plant managers said a lack of resources was the primary barrier to a program, while 19% cited a lack of buy-in from management and 13% said there was a problem with calculating the ROI of such a project. Just 15% said the biggest problem was a lack of buy-in from line workers.
Despite this, most plants have an aggressive energy reduction goal, and most expect to meet those goals. More than 70% of plants have an energy reduction goal of at least 10%, and 5% have a goal of more than 20%. More important, 89% of plant managers said they believed their energy management goals were achievable. Those cost savings do not translate into greater compensation for the plant manager, but just 22% of plant managers are compensated for achieving energy management goals.
Utilities have emerged as a key partner in energy management programs, and most plants understand the value of that relationship. Two-thirds of plant managers said they work with local utilities on energy management, and 78% cite the utilities as a valued partner. Of those plants which don’t work with a utility, 46% said they were unaware their provider had a program and 33% said they didn’t consider themselves a large enough customer to be in the program.
"It’s clear that all parties involved in industrial energy management need to do a better job educating the end users on the value of a sound energy management program," Vavra said. "Utilities need to continue their outreach to industrial users of all sizes. Manufacturing suppliers must continue to explain how the combination of energy audits and energy management systems can help plants get a true understanding of their energy use. Plant managers must have a better understanding of the ROI of energy management and be able to effectively carry that message throughout their organization."
Alternative energy sources have gained some attention, but most are still not in widespread use. Co-generation is used by 21% of plants, with solar (13%) and wind power (9%) each having some use. Still, 49% of plant managers said they do not use any alternative fuel sources.
The survey was conducted by Plant Engineering June 14-23, 2013, to better understand the areas of responsibility and challenges plant managers face when it comes to measuring and monitoring energy consumption. The survey looked at the various kinds of energy sources, including electrical, compressed air, and natural gas, and the energy management programs for each source. It also looked at how manufacturers are working with local utilities on energy conservation programs, as well as manufacturers’ use of alternative fuel sources.
To download the full report, click here