Improving Industrial Energy Efficiency 6 th Annual High- Performance Manufacturing Conference Cobourg, November, 2010

2 Presentation Overview  Why Energy Efficiency CME/NRCan benchmarking survey Government of Canada GHG emissions policy Prices?  Where to begin  The CIPEC Approach 7 Steps to improving your energy management practices Practical examples

3 148 plants participated in the study between October 2008 to July 2009 CME/NRCan Survey

4 Low implementation of technical best practices (TBPs)  Most plants have implemented 42 percent of TBPs  Small- and medium-sized plants have implemented almost 10 percent less TBPs than large plants Technical best practices

5 Low implementation of MBP in Primary Metal manufacturing Other manufacturing Fabricated Metal manufacturing Low implementation of management best practices (MBPs) Higher implementation rates of MBPs were observed in : Chemical Non-metallic Mineral Transportation and Machinery Food and Beverage Management Best Practices

6 Report findings  Energy projects managed on an ad-hoc basis, while best practices not widely implemented.  Large plants have implemented, on average, close to 30 percent more MBPs than SMEs.  When a company follows management best practices, they generally will have a higher implementation rate for technical best practices.

7 Report findings If all the remaining economically feasible best practices were implemented, total Ontario industrial energy use would decrease from 2007 levels by 29% Reference Case and Economic Potential Scenario energy use for all industry

8 Source: NRTEE Getting to 2050 Climate Change Policy Additional reduction GHG Emissions for Industry  610 Mt – Canada’s GHG emissions target for 2020  240 Mt – the amount Canada plans to reduce GHG emissions by 2020  120 Mt – the amount of GHG emission reductions to come from the industrial sector by 2020 Under the Government of Canada revised Turning the Corner – a plan to reduce greenhouse gas emissions by 17% from 2005 levels by Energy efficiency (EE) key to Canada achieving it’s climate change commitments!

9 Rising Energy costs  The report, done for Canadian Manufacturers and Exporters (CME) projects electricity costs for business could jump by between 47.1 and 63.7 per cent by CME September, 2010

10 Industry Challenges  Difficult to obtain company financing to implement EE projects.  Too much effort to access assistance, funding and incentives.  Lack of human resources to focus on energy management.  Production is the dominant focus.  Do not know where to find reputable energy service providers.  Do not know how to identify and assess EE opportunities.  Have limited knowledge of EE opportunities/products.  Advanced EE products are not easily available.

11 7 Steps to Good Energy Management 1.Get Involved 2.Assemble an Energy Team 3.Train Staff 4.Assess Energy Use 5.Eliminate Waste - Maximize Efficiency 6.Capital Projects 7.Report and celebrate Where To Start?

12 An industry/government partnership to promote energy efficiency  cut operating costs  improve productivity  reduce GHG emissions and air pollution Canadian Industry Program for Energy Conservation CIPEC1.

13 Executive Board CIPEC Leader Companies Sector Task Forces & Sector Associations Task Force Council Natural Resources Canada supports CIPEC at all levels CIPEC Structure

14 CIPEC Portfolio Tools CanMost Boiler Efficiency Calculator Energy Savings Toolbox RETScreen International Training D2$ Energy management workshops Qualified specialists Customized for companies and associations Incentives ecoEnergy Retrofit Industrial assessments Pilot projects Solar energy for heating Tax incentives (Class 29, 43.1, 43.2 ) Information Industrial Sector Task Forces Technical guide books Employee Awareness CIPEC.gc.ca web site Heads Up CIPEC newsletter

15  Choose an energy champion  Select team members Plant engineer, maintenance staff, financial advisor  Meet regularly to develop and implement an energy management plan  NRCan employee awareness program “Team Up for Energy Savings” Assemble Energy Team2.

16 Dollars to $ense Workshops  Spot the Energy Savings Opportunities  Energy Monitoring and Tracking  Energy Master Plan  Energy Efficiency Financing Energy Efficiency Training NRCan covers 50% of the cost of a customized workshops tailored to companies and sectors Training to Build Capacity + 3.

17 Assess Energy Use4.

18 Waste and Efficiency 1. From the point of Purchase 2. To the point of End-Use 3. And, back to the point of Purchase (or supply) 5.

19 Checklist of Opportunities  HVAC  Motors  Fans and Pumps  Fuel-Fired Equipment and Boilers  Insulation  Refrigeration  Compressed Air  Lighting  Heat Recovery

20 Operating cost after energy efficiency project Energy & non-energy savings 0 500,000 1,000,000 1,500,000 2,000,000 2,500, Years Annual Operating Cost Avoided Cost from EE project Capital Projects “Do nothing” operating cost 6.

Bayswater Ave.

22 Windows vs Furnace ROI New Furnace:$1,600 ÷ $4,500 = 37% ROI Windows: $500 ÷ $15,000 = 3.3% ROI Simple Payback New Furnace: 2 years 10 months Windows: 30 years Which is the better economic decision?

23 Report and celebrate  Pulp and paper company  85 employees  $600,000 annual energy bill  $200,000 lighting retrofit project  $95,000 in direct incentives $37,000 ecoENERGY Retrofit Incentive $58,000 from utility 7. Savings:- $100,000 per year - ROI < 13 months

24 ecoENERGY incentive  Auto Parts Manufacturer  70 employees  $1 million+ annual energy bill  $100,000 air compressor retrofit  $30,000 in direct incentives $20,000 ecoENERGY Retrofit Incentive $10,000 utility Savings:- $50,000 per year - ROI < 18 months

25 ecoENERGY Incentive  Food & beverage plant  80 employees  $370,000 annual energy bill  $37,000 boiler retrofit project  $9,000 ecoENERGY Retrofit Incentive Savings:- $21,000 per year - ROI < 16 months

26 Who What Creates Savings? Source: Good Practice Guide 84 Managing and Motivating Staff to Save Energy "...those of us who call ourselves energy analysts have made a mistake...we have analyzed energy. We should have analyzed human behavior." (Cherfas quoting Schipper in Science, 1991)

27 Where to Start Become a CIPEC Leader! Go to: CIPEC.gc.ca For more information: Richard Janecky Office of Energy Efficiency Natural Resources Canada Tel: Cel.: