Navigant Research Blog

Automation Gives Manufacturers an Energy Boost

— October 17, 2014

According to the U.S. Manufacturing Purchasing Managers’ Index, a measure developed by financial research firm Markit, manufacturing activity in the United States in September reached its highest point in more than 4 years.  Factory employment, though still well below pre-2008 levels, reached its highest level since March 2012.

U.S. manufacturers are getting a boost from low energy costs, driven primarily by the bonanza of low-cost natural gas (and, to a lesser extent, by distributed renewables, often onsite at plants).  But what’s going on inside U.S. plants is equally important.  Increased energy efficiency, enabled by a revolution in process automation technology, is also helping U.S. manufacturers compete with manufacturers that enjoy low-cost labor in developing countries, particularly China.

Excess No Longer Success

Since peaking around 1999, the primary energy use in the U.S. manufacturing sector has declined steadily, according to the American Council for an Energy-Efficient Economy, from about 35 quadrillion BTUs annually to less than 31 quads.  Energy intensity – the BTUs used per dollar value of shipments – has declined even more dramatically.

The shift is coming as a shock to old-line factory managers unused to calculating energy as a key metric of efficiency and productivity.  “No one ever got fired for purchasing a pump or a machine that’s too big for the job,” said Fred Discenzo, manager of R&D at Rockwell Automation, at a recent energy management conference in Akron, Ohio.  In manufacturing, “excess capacity has always been the safe option.”

Rockwell is among an emerging segment of technology vendors that is trying to change that, through what it calls “the connected enterprise.”  What that means is connecting the factory floor to the C-suite with far greater visibility and immediacy than before.  Another name for this change might be “extreme granularity.”  In the near future, energy use will be measured not at the factory or line or machine level, but at the individual process level, per unit of production: how much energy did it take to make this widget or valve or bag of ice, and where in the process can that energy use be optimized?

The Next Revolution

Advances in factory-floor networks, wireless sensors, virtualization, and monitoring equipment are enabling these improvements in manufacturing efficiency, energy conservation, and quality control.  These twinned revolutions – cleaner, cheaper, more distributed energy coming into the plant and sophisticated automation technology reducing energy intensity inside the plant – will result in changes that have far-reaching implications for the manufacturing sector, and for the economy.  “The new era of manufacturing will be marked by highly agile, networked enterprises that use information and analytics as skillfully as they employ talent and machinery to deliver products and services to diverse global markets,” concluded a 2012 McKinsey study entitled Manufacturing the Future.

At 32% of total energy consumption, industry uses more energy than any other sector of the U.S. economy.  Manufacturers that adapt to the new realities of energy, by changing the ways in which they source and use electricity, will be more competitive on the global stage – and could help usher in the new economic upswing that politicians and analysts have been dreaming of for years.

 

Trucks Largely Overlooked in Emissions Targets

— October 15, 2014

In the transportation sector, trucks are a bit like offensive lineman in football: the heftier bodies do the hardest work, but they don’t get the same amount of attention as the smaller and more nimble players.  But trucks will need greater recognition for their impact on fuel consumption if goals for signification emissions reductions are to be reached.

Most of the discussion (and efforts) around improving fuel economy and reducing greenhouse gas (GHG) emissions is centered on light duty (LD) cars and the Environmental Protection Agency’s (EPA’s) ambitious Corporate Average Fuel Economy (CAFE) requirement, while neglecting the first rules for medium and heavy duty (M/HD) truck emissions reductions that the EPA implemented in 2011.  M/HD trucks and buses are expected to represent 32.6% of the total fuel consumption in the United States, according to Navigant Research’s report, Transportation Forecast: Global Fuel Consumption. Considering that light trucks (including minivans and SUVs) represent 51% of LD vehicles sold in the United States (according to Automotive News), trucks are the clear majority in the opportunity to reduce emissions.

Energy Consumption in Transportation by Vehicle Type, United States: 2014-2020

John truckblog chart

(Source: Navigant Research)

The alternative fuel truck options on the market (including electrified, natural gas, and propane vehicles) are insignificant in comparison to the numerous alternative car choices.  According to Navigant Research’s report, Transportation Forecast: Medium and Heavy Duty Vehicles, alternative vehicles (which also include buses) are expected to represent just 3.3% of all new large vehicle sales in 2014.

PEV Gap

Because of the surge in fuel production and the low price, natural gas vehicle development and sales have the greatest momentum among alternative fuel trucks.  Global truck and bus manufacturer MAN will be adding compressed natural gas (CNG) trucks to its offerings, while GM is adding a CNG bi-fuel option for its 2015 Silverado and Sierra pickup trucks.  Westport recently launched an enhanced spark-ignited (ESI) natural gas system that the company claims offers a 10% improvement in power and torque over a baseline diesel engine.  For the conversions market, Skygo Fuel Systems now offers a bi-fuel system that continuously blends natural gas and diesel based on performance requirements.

Natural gas has the advantage over full electrification in the truck market, as it can provide similar driving range to diesel without being weighed down by batteries, and the bi-fuel option provides a safeguard if a natural gas refueling station isn’t conveniently accessible.

A significant draw for electrification of utility vehicles is the ability to provide exportable power. Pacific Gas and Electric, which is one of the largest truck fleet operators in the United States, has partnered with EDI to develop a Class 5 utility truck that can be used to provide temporary power when an outage occurs.  Electric power takeoff (ePTO) trucks can operate equipment throughout the day without having to run the diesel engine, which can result in much greater reductions in fuel savings than using battery power when the vehicles are in motion.

The gaping hole in the truck lineup is in the lack of hybrid and plug-in pickup trucks. Truck manufacturers such as Ford are focused on lightweighting via aluminum rather than electrifying the drive train.  Nissan created a pickup version of its LEAF battery electric vehicle (BEV) but has no intention of commercializing it.

 

Epic Electric Transmission Crosses the Rockies

— October 14, 2014

One of the most ambitious high-voltage transmission system and utility-scale energy storage projects in history is happening in the American West.  Designed by Duke American Transmission in a partnership with Pathfinder Renewable Wind Energy, Magnum Energy, and Dresser-Rand, the massive plan was recently announced.  As I have discussed in a previous blog, the utility-scale wind generation projects in progress across the High Plains and the Midwest are epic, to say the least.  Transporting this energy to major population centers such as Los Angeles represents major challenges and huge transmission system investments.  The intermittency of the wind resource needs to be managed, as well.  That is why this proposal represents some very creative thinking and engineering.

Driving cross-country from San Francisco to Northern Wisconsin on I-80, I began to better understand the massive geographical challenges that transmission utility planners and operators face.  The idea of moving twice the power that the Hoover Dam in Nevada produces from Chugwater, outside of Cheyenne, Wyoming, to Southern California includes building high-voltage direct current (HVDC) transmission lines across mountain passes up to 11,000 feet in Wyoming, and slightly lower passes in Nevada and California.  These lines will take years to fund and build, creating significant opportunities for major suppliers like ABB, which recently announced new 1,100 kV HVDC transmission system capabilities.

Salt Storage

The other really striking part of this announcement is the grid-scale storage project, which proposes to excavate salt caverns in central Utah and use them to store the wind energy as huge volumes of compressed air, serving as a massive battery, larger than any storage system ever built.  Compressed air would be pumped into these caverns at night, when wind power generation is peaking, and discharged during the day during periods of higher demand. 

The proposal is currently going through what may be endless approval processes at the state and federal levels, but a decision could come as soon as 2015.  In many ways, this new and novel proposal reminds me of the Pacific Gas and Electric (PG&E) Helms pumped storage solution that has been operating since 1984, storing Diablo Canyon’s nuclear output at night by pumping water up into a lake and then discharging it through turbines for peak generation.  The Duke project could be an epic feat of American power engineering to rival Hoover Dam itself.

 

What Robots Can Teach Us about Energy Management

— October 14, 2014

The Tennessee Valley Authority (TVA) has learned some valuable lessons from a study involving the use of robotics to simulate human behavior.  The results show that dramatic improvements in efficiency can be obtained with a combination of new technology and a focus on energy efficient construction techniques.

The 5-year Campbell Creek project involved three similar Knoxville, Tennessee-area homes.  Each has the same floor plan, with two stories, and measures between 2,400 and 2,500 square feet.  Here is how they differ:

  • Builder House: This was the control home, or benchmark, built to represent a typical residence constructed for the Tennessee Valley and built to local building codes.
  • Retrofit House: This house was essentially the Builder House, but retrofitted with energy efficiency technologies, such as more energy efficient windows, ENERGY STAR appliances, compact fluorescent lights, sealed attic with foam insulation, and high efficiency heat pumps.
  • High Performance House: This house was built using the latest available construction technologies aimed at energy efficiency, as well as PV panels and solar water heating to help make it a near zero energy house.

The TVA then outfitted each home with robotic devices to mimic human behavior.  For example, a robotic arm on the refrigerator in each home would open the door simultaneously at 3:00 in the afternoon, when kids typically arrive home from school.  Each home had the same automated systems to turn on lights, televisions, appliances, and showers.  The homes also had a device that replicates how a person’s body heat affects the temperature and humidity of a room.  In addition, each home had hundreds of sensors installed to monitor energy consumption of all the subsystems.

Results and Lessons

The Builder House had a utility bill of about $1,600 a year, the Retrofit about $1,000, and the High Performance was slightly more than $400, according to project managers.  Based on the Home Energy Rating System (HERS) Index, the homes scored as follows: Builder House, 101; Retrofit House, 68; and High Performance House, 34 (a lower score is better).

The TVA project was conducted with partners Oak Ridge National Laboratory (ORNL) and Electric Power Research Institute (EPRI).  Near real-time data from the project as well as archived results are available at the EPRI web site.

These are not exactly startling results, but this intriguing study has valuable lessons for all stakeholders – utilities, homebuilders, and homeowners.  One main lesson is that doing basic things like tightening a home’s envelope with enhanced insulation and energy efficient windows will have lasting benefits.  Also, investing in the most efficient HVAC and water heating systems one can afford will pay off in energy savings.  The manager of the project, David Dinse, who has just retired, told me the project has generated quite useful data – so why aren’t more builders and utilities taking these lessons and running with them?

 

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