AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE Acknowledgments
The Clean Energy Finance Corporation (CEFC) gratefully acknowledges the contributions of the following organisations
• Alan Pears
• Mars Australia
• BlueScope Australia and New Zealand
• Spirax Sarco
• CSR Limited
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Contents
Our commitment to manufacturing 3
Australian manufacturing 4
Getting control of the energy challenge 6
About this guide 9
Identifying gas efficiency opportunities 10
Best practice energy efficiency 12
Where to act: Steam systems 13 Where to act: Hot water 16 Where to act: Process heating 17 Where to act: Multiple technology applications 19 Where to act: Fuel switching 24
How to assess energy intensity 26
Essential skills for energy efficiency projects 28
Financing gas efficiency and fuel switching projects 30
Case studies 34
Glossary 36
PAGE 1 PAGE 2 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
Our commitment to manufacturing
The Australian Industry Group, the Clean with market reforms and the Australian or shifting from gas to lower intensity Energy Finance Corporation and the Domestic Gas Security Mechanism. The energy sources, this guide is aimed Energy Efficiency Council are pleased to extreme prices of 2017 – including some at providing useful insights into present a new resource for gas-intensive industrial offers above $20 per gigajoule technologies and equipment that can manufacturers: Australian Manufacturing – have thankfully abated. But prices make long-term differences. Gas Efficiency Guide. remain two to three times their historic average. It is unlikely they will ever Furthermore, the benefits of gas All our organisations have a strong return to the low levels on which industry efficiency can go well beyond cost and commitment to helping Australia’s used to rely, given the transformation emissions savings; they include reducing energy intensive manufacturing of the gas market by export demand, maintenance costs, improving the life industry reduce operating costs and international price pressure and rising expectancy of equipment, reducing carbon emissions. This guide will assist production costs. water consumption and improving the sector to remain cost competitive in site conditions. a global economy that is moving High gas prices could be a persistent fast towards lower emissions and challenge to industry. However, recent The opportunities are significant, cleaner energy. analysis has revealed an untapped however determining whether an opportunity to reduce industry approach will work for an individual Australia’s manufacturing sector has reliance on gas by at least 25 per cent business involves disciplined research confounded doubters in recent years in Australia, resulting in estimated and measurement to identify the by expanding strongly. The sector has emissions savings in the region of opportunities that are affordable the potential for even greater growth and feasible. 10Mt CO2e. amidst a new industrial revolution that is transforming industry yet again. This guide examines the energy needs This guide is intended to help with the However, energy costs loom as one of a wide range of manufacturers, from identification of possible initiatives at of the most significant headwinds to food processors to building materials the earliest stages of planning, before seizing this opportunity. producers and identifies areas of moving on to project-specific advice opportunity in terms of performance, from industry specialists. We hope it Recent high gas prices and unfavourable cost and paybacks. provides inspiration to those in the contracting conditions have put pressure sector who have been meaning to on tight operating margins for many Whether it is through maintenance take the first steps to achieving better manufacturers. Industry has been at improvement, replacing old equipment, gas efficiency, but weren’t sure the forefront of efforts to ease prices smart redesigns of industrial processes where to start.
Ian Learmonth Luke Menzel Innes Willox CEO, Clean Energy Finance Corporation CEO, Energy Efficiency Council CEO, Australian Industry Group
PAGE 3 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
Australian Manufacturing TAKING CONTROL OF THE ENERGY CHALLENGE
LESS GAS AUSTRALIAN WHERE TO ACT MORE BENEFITS INDUSTRY SIGNIFICANT OPPORTUNITIES
PROVEN LESS TECHNOLOGIES GAS $100B 900K HOT 81 25% GDP JOBS STEAM WATER
YEAR CARBON PAYBACK SAVINGS 5 10Mt NATIONAL ENERGY PROCESS FUEL FOOTPRINT INTENSIVE HEATING SWITCHING
PAGE 4 PAGE 5 Taking control of the 1 energy challenge
PAGE 6 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
The Australian manufacturing industry includes businesses engaged in the physical or chemical transformation of materials into new products1. Manufacturing is vital to the Australian economy, contributing around $100 billion (6.2 per cent) to Gross Domestic Product annually and supporting nearly 900,000 jobs, or 7.4 per cent of total employment.2
Australia’s manufacturers are the most Market Operator (AEMO) data, the represent an estimated emissions 3 energy intensive in the OECD and Australian Competition and Consumer reduction of 10 MtCO2e/year based on are also large users of natural gas. In Commission (ACCC) expects WA to be current levels. 2014-15 Australian manufacturing was well supplied with gas in the short to responsible for around 40 per cent of medium term8. These big improvements can be total natural gas consumption4. achieved through: With little prospect of major new This reliance on gas has been driven sources of supply in the southern • Equipment maintenance by twin forces. Historically, eastern states in the near-term9, future prices improvements Australia has benefitted from lower will almost certainly continue to be • Operational optimisation gas prices more than most other areas influenced by international LNG prices10 of the developed world because of and domestic demand. In this context, • Replacement of old equipment with the relatively plentiful availability of Australia’s manufacturers must anticipate more efficient, newer equipment low cost, conventional gas supplies. and adapt to prices much higher than • Smart redesign to improve industrial At the same time our geographical the historical average, as well as the processes isolation has meant there has been a potential for increasing • Fuel shifting from gas to solar lack of competition for Australian gas price volatility. thermal, solar PV, bioenergy and low from international customers, limiting emissions electricity. demand-driven price increases. These factors mean it is increasingly important that manufacturers move Every manufacturing operation is However, the east coast gas market now to unlock significant untapped different, and manufacturers need the is experiencing a mismatch between opportunities to reduce their reliance on right information and expert advice domestic supply and demand, gas through a more rigorous approach to identify the most appropriate driven by rapid growth in the liquid to energy efficiency and switching to energy solution for their activities. The 5 natural gas (LNG) export market and alternative cleaner energy sources. Australian Industry Group, Clean Energy exacerbated by regulatory uncertainty Quick action tailored to particular Finance Corporation and the Energy and exploration moratoria limiting the business needs can deliver much Efficiency Council developedAustralian potential for new gas supply6. needed energy cost savings, improve Manufacturing Gas Efficiency Guide, productivity and competitiveness, and As a result, Australian manufacturers a user-friendly resource for decision- help meet Australia’s targets for lower makers seeking to reduce their exposure are grappling with high gas prices and greenhouse gas emissions11. unfavourable contracting conditions, to rising gas costs. increasing margin pressures and Recent analysis has found that by We trust this material provides a useful 7 challenging the long-term viability of implementing energy efficiency resource to enable the adoption of a this important sector. measures and switching from gas to more cost-effective and efficient clean other clean energy sources, Australian The Western Australia market is energy solution for this important part of industry can reduce gas consumption our national economy. separate and somewhat insulated from by at least 25 per cent on current levels, the circumstances present on the east or 201 petajoules (PJ)/year12. This would coast. Based on Australian Energy
PAGE 7 ENERGY EFFICIENCY BENEFITS TO MANUFACTURING
Reduced maintenance Improved equipment improved energy Improved process
Reduced maintenance Improved equipment life Reduced water requirements and costs expectancy – reduced consumption and water – reducing the heat load operating hours and treatment costs – many on industrial systems may reduced thermal stresses steam system and heat Reduced water consumption Improved safety Reduced maintenance reduceImproved equipment the maintenanceimproved energyReduced maintenance Improved process Improved equipment mayimproved allow energy plantImproved process recovery efficiency costs on large plant assets equipment to last longer initiatives will also result in such as boilers. before requiring a reduction in water replacement or major consumption and less overhaul. water requiring chemical Reduced water consumption Improved safety Reduced water consumption Improved safety treatment prior to use.
Reduced maintenance Improved equipment improved energy Improved process
Improved energy Improved process Improved site safety and visibility and control – often energy working conditions understanding – reduction initiatives utilise – eliminating waste heat automatic controls with can provide a safer work installation of sub Reduced water consumption Improved safety
Reduced maintenance Improved equipment improved energy Improved process Reduced maintenance Improved equipment improved energy meteringImproved process and energy smaller error bands than environment where staff management systems are traditional control are at a reduced risk of critical to the longevity of systems. This can allow for exposure to high savings and can provide smoother and more temperature equipment ongoing value and automated control of or uncomfortable work
Reduced water consumption Improved safety Reduced water consumptionunderstandingImproved safety to plant connected systems. environments. operations.
1 https://www.industry.gov.au/industry/ManufacturingPerformance/Pages/default.aspx 2 Department of Industry, Innovation and Science (2015) Manufacturing Data Card - September Quarter 2015: https://www.industry.gov.au/industry/ManufacturingPerformance/Pages/ManufacturingDataCard.aspx 3 International Energy Agency (2017) Energy Efficiency Indicators Highlights. IEA/OECD, Paris, France. pp 7. 4 Australian Bureau of Statistics (ABS) (2016b) 4660.0 - Energy Use, Electricity Generation and Environmental Management, Australia, 2014-15, Released 12 Jul 2016 5 ClimateWorks Australia 2017, Solving the gas crisis - A big problem deserves a big solution. Melbourne, pp 3. 6 Mr Rod Sims, Chairman, ACCC - Shining a light: Australia’s gas and electricity affordability problem. National Press Club, 20 September 2017: https://www.accc.gov.au/speech/shining-a-light-australia’s-gas-and-electricity-affordability-problem 7 Ai Group (2017) Energy Shock: No Gas, No Power, No Future? pp 19. 8 Australian Competition and Consumer Commission (ACCC) 2017, Gas inquiry 2017-2020: Interim report - September 2017. Canberra, pp 13. 9 Australian Competition and Consumer Commission (ACCC) 2017, Gas inquiry 2017-2020: Interim report - September 2017. Canberra, pp 74. 10 ClimateWorks Australia 2017, Solving the gas crisis - A big problem deserves a big solution. Melbourne, pp 6. 11 Australia’s economy-wide target under the United Nations Framework Convention on Climate Change is to reduce emissions by 26-28 per cent on 2005 levels by 2030. By the second half of the century, achieving net zero emissions is likely to be necessary to meet international climate commitments. 12 ClimateWorks Australia 2017, Solving the gas crisis - A big problem deserves a big solution. Melbourne, pp 7.
PAGE 8 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
2 About this guide
Many opportunities to reduce gas Shell Energy's senior engineering team Please note: this guide provides consumption – either through energy identified a comprehensive list of gas advice of a very general nature, to aid efficiency measures or fuel switching – efficiency initiatives applicable to the identification of possible energy have not seen widespread adoption in Australia’s manufacturing sector. These efficiency and fuel switching initiatives. Australia due to historically low initiatives where tested with industry It should not be used as a substitute for gas prices. advisors and documented and refined specialist project-specific advice from for inclusion in this guide. industry professionals. As gas prices rise, decision-makers are becoming more focused on how they The initiatives are typically those which: can bring down gas costs. This guide brings together expert information • Have been demonstrated as and insights into proven and practical technically and commercially feasible initiatives that can help Australia’s to implement on manufacturing sites; manufacturers reduce energy costs, • Can be implemented at the design boost productivity and cut emissions. stage for new projects, or as a retrofit The CEFC and EEC developed this to existing equipment and systems; guide with technical input from • Can be implemented through independent engineering consultants, changes in practices and Shell Energy Engineering Pty Ltd. management.
PAGE 9 Identifying gas efficiency 3 opportunities
PAGE 10 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
Decades of low gas prices have energy efficiency opportunities across Identifying gas efficiency meant that many manufacturers have all of these functions, with some not prioritised examination of more opportunities benefiting multiple efficient operating systems or the use of functions. opportunities alternative fuels. There are also a number of ‘enabling Manufacturers typically use gas as an technologies’ – including sub metering energy source13: and analytics platforms – that can play a critically important role in identifying • To produce steam energy efficiency opportunities. • To produce hot water; and Across manufacturing processes there • Tor process heating systems. are also renewable energy options that can reduce or eliminate the need for Many manufacturing sub-sectors use conventional gas use, increasing energy gas for more than one of these functions diversity and minimising the business (Table 1). risk associated with energy costs. These The good news is that there is a options include bioenergy (biomass, significant untapped opportunity to biogas), solar PV, solar thermal and heat reduce reliance on gas by implementing pump technology.
TABLE 1: OVERVIEW OF TYPICAL GAS FUNCTION USE IN MANUFACTURING Food Beverage and tobacco products clothing and footwear leather, Textile, products Wood Pulp, paper and converted products Printing and coal products Petroleum Basic chemical and products Polymer and rubber products Non-metallic mineral products Primary metal and products Fabricated metal products equipment Transport Machinery and equipment Furniture
Steam generation 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3
Hot water generation 3 3 Process heating 3 3 3 3 3 3 3 3 3
13 Natural gas is utilised in some industries as a feedstock to the process, however this is beyond the scope of this guide. PAGE 11 4 Best practice energy efficiency
The best practice initiatives in this guide are presented on the following pages in a ‘dashboard’ format. Each initiative includes a detailed description of the possible improvement. Symbols indicate costs, payback period, and market readiness.
MANUFACTURING ENERGY EFFICIENCY DASHBOARD
Technology Upfront Cost The initiatives have been grouped according to the $ < $15,000 relevant technology area: $$ $15,000 - $50,000 • Steam systems $$$ $50,000 - $250,000 • Hot water $$$$ > $250,000 • Process heating • Multiple technology applications Indications of upfront cost have been assigned based on typical current costs of implementation of projects. • Fuel switching
Payback Period (Years) Readiness Rating < 1 Low hanging fruit A Well established technology, widely adopted < 2 Short term B Moderate uptake < 5 Medium term C Limited implementations in Australia/emerging < 10 Long term technology 10+ May never payback D Not commercially implemented in Australia
Indications of payback period have been assigned based A large number of variables influence cost, payback on implementing the project within an appropriate market periods, suitability and feasibility on any given project, sector and technology type suited to the application. and this indication should not be used as a substitute for project-specific professional advice. They are an indication only, based on a current average gas price. However, there is significant variation in gas Keep in mind that not all of the initiatives described are prices as well as unique site issues that will impact actual compatible with one another – it would not be possible to outcomes. implement all projects on the same site. Only simple economic payback has been considered To reiterate – this guide is intended to provide very – different internal rates of return and consequent net general advice and guide the selection of initiatives in present values have not been considered. the earliest stages of design. It should not be used as a substitute for project-specific professional advice.
PAGE 12 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
WHERE TO ACT: STEAM SYSTEMS
Opportunity Description Cost Payback Readiness
Once steam has been used, the hot condensate holds a large amount of recoverable energy (up to 25% of the initial steam energy). Returning this energy to the boiler can minimise gas use. Maximise Prior to collecting and returning condensate, the quality should be condensate $ <1 A 1 assessed to check it has not been contaminated by product, oil, return chemicals or other sources. Maximising the amount of condensate recovered and returned to the boiler will reduce gas consumption costs and reduce water consumption and treatment costs.
All boilers conduct a ‘blowdown’ process to clear a build-up of STEAM SYSTEMS chemicals and minerals dissolved in the water. This blowdown Total Dissolved process occurs at a set time interval and may purge the boiler Solids (TDS) unnecessarily. Installing sensors to measure the level of dissolved $ <2 A 2 control of minerals can allow the blowdown to be controlled and only occur blowdown when necessary. This can save energy by minimising the heat, water and chemicals lost during blowdown. Most steam systems utilise a small steam line to maintain the feedwater tank at 80-90°C. This hot water is then fed to the boiler and the high temperature helps to minimise gas use from a Maximise sudden drop in boiler temperature. Further efficiency gains can be feedwater $ <2 B 3 achieved by maintaining a high feedwater temperature using heat temperature sources other than steam injection. Feedwater temperature can be maximised through techniques such as condensate recovery, tank insulation, waste heat recovery, and economisers. The quality of the water entering the boiler has a direct relationship to the volume of boiler blowdown required to remove excess minerals. The boiler blowdown is a release of hot water and as such Water treatment is also releasing energy from the system. Water softeners in the to reduce blow $ <5 A 4 boiler make-up water, provide chemical treatment of the water, and down losses can minimise the need to conduct a boiler blowdown. Your water treatment provider can assist with optimising the chemical dosing of boiler make-up water. Hot, pressured water from the boiler blow down contains high levels of minerals and is not suitable for direct use in the boiler system. The heat from the blowdown stream can be used, Blowdown heat however, to maintain high feed water temperatures and pre-heat $$ <5 B 5 recovery make-up water. This is achieved by capturing blow down water, depressurising it to drive off flash steam which is then injected into the feedwater tank. The still hot water is then passed through a heat exchanger to heat the incoming make-up water.
PAGE 13 WHERE TO ACT: STEAM SYSTEMS
Opportunity Description Cost Payback Readiness
Due to variations in plant demand, a steam boiler will not perfectly match the requirements of the plant at all times. Therefore boilers are often operated at partial loads which reduces efficiency. For large systems that operate multiple boilers, it can be difficult to determine which boiler or combination of boilers is most efficient. You may also have multiple boilers operating at partial load. A boiler sequencer can assist with the control of multiple boilers by Boiler selecting the most efficient combination to operate. Sequencers sequencing and $$ <2 A 6 can not only improve total efficiency by utilising the most efficient STEAM SYSTEMS scheduling boiler, but will also reduce partial load operation. This can greatly reduce purge cycle and radiant heat losses. Sequencing control may be achieved through existing control panels, site SCADA system or a dedicated controller. Careful consideration should be given to the control logic of a sequencer in order to maximise efficiency. A review of the controls should be conducted if major changes to plant steam demand occur. Every steam system utilises steam traps in order to hold useful steam in the system, whilst releasing condensate. Steam traps often fail resulting in steam being vented from the system or condensate being held in the system. Both scenarios reduce total system efficiency. Identification of failed traps can reduce operating Failed steam costs of the steam system. A scheduled maintenance program for traps and steam $$ <2 A 7 steam traps should be implemented on a 6 or 12 monthly cycle. leaks This should include an ultrasonic and temperature bases survey of all traps followed by replacement of failed traps. This is also an opportunity to identify and replace traps that have been incorrectly selected or installed. Hard to access traps can be monitored remotely using a wireless steam trap meter. As steam is generated within the boiler, the water level changes and cool make-up water is provided to offset the steam demand. For boilers below 3MW, typical on/off water level control Modulating mechanisms can adequately maintain boiler operation, but water level $$ <2 A 8 efficiency can be improved through the implementation of a control modulating level control system. A modulating level control system provides smoother operation of the boiler and more efficient burner operation. Condensate captured from a steam system may be at a high temperature and a high pressure. Reducing the pressure of the Flash steam condensate allows the residual heat to create flash steam. This flash $$$ <2 B 9 recovery steam can then be utilised for lower temperature applications or waste heat recovery.
PAGE 14 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
WHERE TO ACT: STEAM SYSTEMS
Opportunity Description Cost Payback Readiness
A steam accumulator can be added to a steam system to provide additional storage. If correctly designed, this storage can be used to eliminate or minimise peaks in the steam demand of the plant. Steam This can provide energy savings by allowing one boiler to meet the $$$ <5 C 10 accumulator plant demand and eliminating the operation of a second boiler for the peak load. Steam accumulators should also be considered when designing a new or replacement system as a smaller boiler may be able to be purchased in conjunction with an accumulator.
The internal lining of a boiler’s combustion chamber is commonly STEAM SYSTEMS lined with refractory material to reflect the heat back into the Add/refurbish chamber. This material can become less effective as it ages and $$$ <5 A 11 boiler refractory covered by soot from combustion. Relining the boiler with new refractory material will assist in localising heat and minimising radiant losses from the surface of the boiler. Large boiler systems can benefit from a pressurised de-aerator over the traditional atmospheric de-aeration head. The de- aerator provides a mixing point for make-up water and recovered condensate to assist with oxygen removal from the make-up water. Pressurised The removed oxygen is then vented to atmosphere with a portion $$$ <5 A 12 de-aerator of heat from the system. A pressurised de-aerator allows higher temperatures within the aerator and therefore increases thermal efficiency. This also has the operational benefit of lower oxygen levels and therefore reduced system corrosion. During steam generation, water is heated to the point where it evaporates to create saturated steam. This steam is at a temperature where a small temperature decrease will result in condensate and the release of a large amount of heat. In some steam systems, particularly where power is generated from 13 De-superheaters steam, the steam is further heated to create superheated steam. $$$ <5 B Superheated steam has benefits for turbine operation during power generation, but is less thermally efficient for heat transfer applications. In these instances, the installation of a de-superheater to cool the superheated steam back down to saturated steam can be beneficial.
PAGE 15 WHERE TO ACT: HOT WATER
Opportunity Description Cost Payback Readiness
The requirements of a plant may change over time, or the operation of equipment may be changed by operators or service Reduce providers. Determining the site’s maximum hot water temperature, 1 hot water and decreasing the hot water heater’s output to match this can be a $ <1 A temperature simple measure to reduce gas consumption. Care should be taken to ensure that the temperature still meets any appropriate safety requirements. HOT WATER Much of the hot water use within the food manufacturing sector is used for cleaning purposes. Commonly this is through taps and hoses with no nozzles on the outlet. As such, it is common for far more hot water to be consumed than is actually necessary to Hot water use: 2 perform the function. There are a variety of nozzles available which $ <1 B efficient nozzles can assist in minimising the amount of hot water used. In addition, trigger control at the point of use can reduce unnecessary use of hot water. Operator training and engagement is often required to ensure the introduction of nozzles and triggers are accepted. Hot water systems can waste energy by the heater responding to heat losses in the pipework and distribution system rather than Hot water heater actual load requirements. Modern control units are available which $$ <2 B 3 control can measure the supply and return temperatures to determine if the temperature change is due to a load or standing losses and determine if the heater needs to operate. Some food manufacturers are operating steam systems as a result of historically available technology when the site may only require hot water. In these cases, steam is used to generate hot water and Condensing this consumes much more energy than direct hot water generation, 4 boiler due to the higher temperatures and evaporation process. If your $$$$ <10 B (generator) site only requires hot water, consideration should be given to replacing the boiler with a condensing boiler (generator) designed specifically for hot water production.
PAGE 16 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
WHERE TO ACT: PROCESS HEATING
Opportunity Description Cost Payback Readiness
Combustion air fed to process heating applications contains approximately 21% oxygen due to the makeup of the atmosphere. Supplementing combustion air with oxygen provides an oxygen Oxygen enriched environment which can assist with combustion efficiency. $ <5 C 1 enrichment Since using oxygen avoids heating up almost five times as much air, it can be worthwhile, especially for high temperature processes. Due to advancements in technology, this is becoming a viable approach, particularly in the metals processing sector.
Many process heating applications have been in operation for PROCESS HEATING a number of years without consideration given to the required operating temperature. Changes in raw material and final product Process specification may present an opportunity to reduce the operating $ <1 B 2 temperature temperature of the process without detrimental effects on the quality of the product. These process improvements can provide significant savings, however they may require detailed investigation to confirm viability. Many process heating applications utilise ovens and furnaces to localise the heat of combustion for specific applications. These ovens and furnaces are often long, with multiple burners and Air infiltration are enclosed with multiple access hatches and doorways. These 3 $ <5 A and seals access ways are often a source of heat loss due to lack of, or poor seals around the hatches. Thermal imaging along with insulation and seal specialists can assist with identification, costing and implementation of air infiltration initiatives. Recirculation fans can assist with providing an even heat distribution within process heating applications such as ovens and Recirculation furnaces. The small addition of electrical energy for fans can often 4 $$ <5 B fans decrease the gas requirements as heat becomes less localised around the burners and a greater thermal efficiency can be achieved. Pre-heating of products or material prior to entering process heating application can assist in reducing gas consumption. Product Exhaust gases may be able to be used in a waste heat recovery 5 $$ <2 B pre-heating process to pre-heat materials. This is particularly effective where the materials are in liquid form as this allows for good heat transfer with waste heat. Many process heating applications operate a number of associated fans and pumps which can save electrical energy if controls are linked to the combustion process. This may allow recirculation Process heat fans and pumps to operate on Variable Speed Drives (VSDs) and 6 ancillary $$ <2 A reduce consumption as the combustion load decreases. Installation controls of newer motors, fans and pumps can also result in additional electrical energy savings. Whilst the focus here is gas savings, electrical energy savings can assist in reducing project payback.
PAGE 17 WHERE TO ACT: PROCESS HEATING
Opportunity Description Cost Payback Readiness
Many high temperature process heating applications require cooling of components to minimise thermal stress and damage. Due to advancements in materials development, conventional Advanced materials may be able to be replaced with advanced materials 7 $$$ <10 D materials which are able to withstand higher temperatures with less thermal damage. As a result, the heat load on the system is often reduced. The advanced materials often result in a lower mass of components and this provides a further efficiency improvement.
PROCESS HEATING Many opportunities exist to reduce thermal/gas requirements through changes in the material handling processes. This does not utilise a specific technology to achieve efficiency but utilises improved process flow and/or controls to minimise heat Material requirements. An example of these improvements may include 8 handling reduction of product holding times between casting and further $$$ <10 B improvements processing in metal manufacturing plants. This allows the product to be received into downstream processes at higher temperatures and reduces the overall thermal energy requirements. Another example is the application of product sensors and controls to switch off (or idle) thermal equipment if product is not detected.
PAGE 18 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
WHERE TO ACT: MULTIPLE TECHNOLOGY APPLICATIONS
Technology Opportunity Description Cost Payback Readiness Area Plants operating less than 24 hours a day, or 7 days per week, may benefit from aligning boiler operation with production requirements. Many such plants start up the boiler prior to production, Steam resulting in an additional 1-2 hours of boiler Systems operation per day. Improving plant scheduling may involve determining the actual start-up time 1 Plant scheduling $ <1 Process A of the boiler and operator training or practice Heating changes to ensure the boiler is turned on a short time before the first production process Hot Water that requires steam. This can be a very low cost housekeeping opportunity and can minimise gas TECHNOLOGY MULTIPLE consumption through a reduction in purge losses and radiant heat losses. Within steam boilers, hot water systems and process heating, the efficiency objective is to Steam transfer the maximum amount of heat from Systems combustion into the water or process fluid. Maximise heat Therefore it is important to maintain clean heat 2 $ <2 Process A transfer transfer surfaces within the combustion chamber. Heating This can be achieved through a combination of water treatment to minimise scaling, combustion Hot Water analysis and control to minimise soot, and periodic cleaning of heat transfer surfaces. Combustion of gas should be periodically monitored to ensure that control systems are working properly and identify if there are improvements that can be made. Many existing Steam combustion systems rely upon mechanical Systems linkages between the gas inlet and combustion Combustion air control which wear with time and therefore 3 analysis and $ <1 Process A require periodic adjustment to maintain efficiency. tuning Heating Combustion analysis is already being conducted by your service provider for safety reasons but Hot Water should also be incorporated into scheduled maintenance for efficiency checks. Combustion service providers can typically tune the system whilst conducting the analysis. Old, unused steam and hot water lines provide a location for steam and water to collect and Steam Isolate unused cool. This can potentially reduce the temperature Systems 4 $ <2 A steam lines of steam and water nearby and reduce overall efficiency of the system. Unused lines should be Hot Water isolated from the system to minimise losses.
PAGE 19 WHERE TO ACT: MULTIPLE TECHNOLOGY APPLICATIONS
Technology Opportunity Description Cost Payback Readiness Area Sensor selection, positioning and maintenance Steam can have a large impact on the energy Systems Sensor selection consumption of a system. If a sensor is not 5 $ <1 A and placement accurate or is incorrectly positioned, the control Process system may be receiving the wrong information to Heating be able to efficiently control the system. The controllers for many thermal applications contain pre-programmed logic to define how the system will operate and respond to temperature Steam changes. The algorithms within these controllers Systems MULTIPLE TECHNOLOGY MULTIPLE may be basic and allow the system to overshoot 6 Process control $$ <2 A the temperature target and then drift back to the Process required level. This can waste significant gas and Heating can be avoided through the implementation of modern control algorithms with tighter control bands. When the burner is not operating in a combustion chamber, hot flue gases may be escaping from Steam the system. This can be reduced by installing Systems dampers to close off the flue. This initiative Flue gas shut off 7 can contribute small savings (1%) to the boiler, $$ <2 Process B dampers particularly in applications where the boiler may Heating cycle off for extended periods of time. These dampers do not provide any benefit for systems Hot Water when the burner is operating. A large heat user from steam and hot water systems is the CIP processes on food manufacturing plants. Often the CIP utilises a Steam Cleaning In number of rinse cycles and heated chemicals. Systems 8 Place (CIP) $$ <5 B Process optimisation of CIP may involve insulation optimisation of heated chemical tanks, and capturing Hot Water secondary or final rinse cycles and storing them to become the initial rinse cycle in the next CIP run. When steam, hot water and thermal fluids are generated at the source (such as a boiler), the hot fluid must then be transferred to the actual point of use on the plant. Whilst travelling through the Steam pipework, a significant portion of the heat can Systems be lost. Insulation and pipe lagging can greatly Pipe and valve reduce the heat lost from piping. Permanent 9 $$ <2 Process A insulation insulation should be installed on all hot pipe Heating work. Thermal imaging can be used to identify areas where additional insulation is necessary and Hot Water assist with quantifying the energy loss for business case development. Regular maintenance surveys of insulation should be conducted to ensure it is in place, in good condition and effective.
PAGE 20 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
WHERE TO ACT: MULTIPLE TECHNOLOGY APPLICATIONS
Technology Opportunity Description Cost Payback Readiness Area Air is needed for the combustion of gas to release useful heat. As large volumes of combustion air are typically provided at ambient temperatures, this Steam air is much cooler than the combustion chamber, Systems and more gas is used to bring the combustion Combustion air products (flame) up to the required temperature. $$$ <5 Process B 10 pre-heat Combustion air pre-heating increases air Heating temperature before injection into the combustion chamber and can reduce gas consumption. Hot Water Combustion air is typically pre-heated with waste heat from other sources on site, or the stack/ exhaust from the oven/furnace. TECHNOLOGY MULTIPLE Boilers for both steam and hot water lose waste heat through exhaust gases and radiant and convective losses. Radiant losses are related to the surface area, material and temperature of $$$ Steam the boiler. Covering exposed, high temperature Systems Boiler insulation (Depends <5 A 11 surfaces of the boiler with insulation can reduce on the m2 radiant and convective heat losses. Thermal Hot Water insulated) imaging can be helpful in identifying the hottest parts of the boiler and all areas that need insulation. The burner is a crucial piece of equipment in gas systems as it is the point of mixing for fuel and air, and is the actual point of combustion. Upgrading Steam existing burners to modern technology can assist Systems with air to fuel mixing, and heat distribution 12 Burner upgrade which contribute to efficiency gains. In addition, $$$ <5 Process A modern burners are typically able to achieve a Heating greater turn-down ratio, meaning that the boiler is able to operate more efficiently under low Hot Water load conditions. This can drive significant savings through a reduction in boiler purge cycles. Many existing combustion systems rely on a mechanical linkage between the gas inlet and combustion air control. These linkages are subject to incorrect tuning, wear and have limitations in Steam how closely they can control the fuel to air ratio. Systems Modern digital combustion control systems (also Digital commonly known as oxygen trim or air to fuel combustion <5 Process A 13 ratio controllers) can provide energy savings $$$ control Heating through a tighter control capability, independent operation of gas and air controls and more Hot Water consistent control with time. Many of these controllers can be connected to the site’s SCADA system to provide monitoring and reporting of the boilers.
PAGE 21 WHERE TO ACT: MULTIPLE TECHNOLOGY APPLICATIONS
Technology Opportunity Description Cost Payback Readiness Area In order to achieve good combustion of the gas injected into a boiler, water heater or process heater, air is also injected by a combustion air fan. These fans often operate at fixed speed with an inefficient damper to control air flow. Implementing a Variable Speed Drive (VSD) on Steam the fan and removing the damper can result Systems Variable Speed in a reduction of electrical energy consumed Drive (VSD) on by the fan and provide more accurate control <5 Process A 14 combustion of combustion air delivered. This control $$$ Heating air fan improvement improves the ratio of gas to MULTIPLE TECHNOLOGY MULTIPLE combustion air providing savings by minimising Hot Water unburnt gas in the flue and minimising excess heat removed by providing too much combustion air. Combustion air fan control is often incorporated with digital combustion control projects and combustion air pre-heat projects to maximise energy savings. From the combustion process in steam boilers and hot water heaters, a large amount of heat is lost in the exhaust gases vented via the flue. Heat from the exhaust gas can be recovered through the use of an economiser. The economiser is installed in the flue and feed Steam Condensing and water is passed through the economiser allowing Systems non-condensing <5 B 15 the water to be heated. There are condensing $$$ economisers and non-condensing economisers. Condensing Hot Water economisers will recover a larger amount of heat, however, water vapour in the exhaust will condense which is corrosive and special care with material selection must be taken when considering this type of economiser. Many industrial applications will require thermal energy which is derived from steam or a heat source. Often the remaining steam, condensate or heat source still has a significant amount of thermal energy available but at lower temperatures. This presents the site with an Steam opportunity to recover the lower grade heat Systems and use it in a different area of the plant. This Waste heat can offset gas consumption in other heating <5 Process B 16 recovery $$$ processes or at the boilers. Potential areas for Heating heat recovery include waste condensate, boiler blowdown, flue gases, combustion air preheating Hot Water and process streams that require heating or cooling. Heat recovery can also come from tertiary systems (such as compressed air and refrigeration) to provide heat for pre-heating or low grade hot water.
PAGE 22 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
WHERE TO ACT: MULTIPLE TECHNOLOGY APPLICATIONS
Technology Opportunity Description Cost Payback Readiness Area Cascading heat use aims to maximise drying processes by utilising the highest temperature heat source at the end of the drying process where moisture removal is most difficult. After the initial use of heat, the heat source is then utilised for multiple passes earlier in the drying Steam process. This is common in the paper industry Cascading heat Systems where steam is used at the final stage of the <5 B 17 use $$$ paper drying process. Excess heat from the steam Process and flash steam is then used in the previous Heating drying stage and so on, back to the beginning of the drying process. This method of control can TECHNOLOGY MULTIPLE maximise heat extraction from the source and maximise drying efficiency through the greatest temperature driver. Sub metering systems use a number of carefully placed energy meters (such as gas, steam or thermal meters) to pinpoint how different parts of the site are using thermal energy. This allows Steam energy wastage to be identified, and helps Systems in managing improvement. Connecting sub Sub metering meters to an energy management platform can 10+ Process B 18 systems $$$ automatically record data in one place, and Heating provide meaningful analysis of the data. Emerging data analytics techniques can increasingly reduce Hot Water the need for sub metering and improve feedback on operation. While most focus has been on electricity analysis, it can also be applied to gas. Plants that do not operate 7 days per week, or have a highly variable steam or hot water demand, may benefit from a low load boiler. This allows the large boiler to meet the plant demand during normal operation and the smaller boiler to operate during weekends or low load periods. This initiative can greatly minimise the Steam Boiler sizing and inefficiencies associated with purge cycles and Systems 19 $$$$ <10 A low load boiler radiant losses of an oversized boiler. Hot Water This approach may also apply to situations where there are small steam loads connected to a large steam system but distributed over a large physical area. In these cases, it can be viable to operate separate steam/heat systems to offset losses from large piping runs.
PAGE 23 WHERE TO ACT: FUEL SWITCHING
Opportunity Description Cost Payback Readiness
Where electricity is available in abundance or at low cost, heat pumps can be utilised for thermal energy, in the range of 65-150°C, to offset gas consumption. Heat pumps utilise a refrigeration cycle process to transfer heat from one stream to another whilst increasing the heat through an electric pump. Where traditional heat recovery is not possible due to a lack of 1 Heat pumps $$$ <5 D temperature difference, heat pumps can be used to take the heat from a warm stream and transfer it into a hotter stream.
FUEL SWITCHING Heat pumps are most efficient in systems where heating and cooling is required as one stream can be cooled whilst another is heated. They are especially good when the waste stream is humid, as they can recover the latent heat. Solar hot water systems can be used to eliminate or offset the hot water generation through steam or instantaneous systems. Solar hot water systems collect heat from direct sunlight in either a flat plate or evacuated tube system. Evacuated tube 2 Solar hot water systems are more thermally efficient particularly in cold weather. $$$ <5 B Usually solar hot water systems are fitted with a gas or electric heating booster to achieve the correct temperature when natural conditions are inadequate. Solar hot water systems may also be used as a preheating source for boilers. Many steam systems are designed to produce steam at a higher pressure than actually required on the plant, as this allows the pipework to be smaller with a lower capital cost. As a result, steam systems often incorporate a pressure reduction valve (PRV) to lower the pressure to the plant’s needs. During the pressure Condensing and reduction, pressure energy is lost. This PRV can be replaced 3 non- condensing $$$$ <5 C with a steam turbine to generate electricity through the process turbines of reducing steam pressure. No gas savings are achieved but the electricity generated can offset site electricity costs. These turbines work best in applications where steam demand is continuous. Effectively this is a form of cogeneration and the electricity is mostly produced from reduced energy waste. Thermal energy has traditionally been provided by gas systems, however there are a number of process heating applications such as heating, drying, melting and forming that may be conducted through electric-based thermal energy. There is Alternate potential to switch from gas based systems to electric based 4 process heating systems such as arc furnaces, infrared, induction, laser and $$$$ <10 C technology microwave systems. Whilst switching to alternate heating methods, implementation of other efficiency measures are often included to minimise energy requirements. This type of switching to alternate technologies is highly dependent upon the price and availability of electrical energy and relative capital costs.
PAGE 24 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
WHERE TO ACT: FUEL SWITCHING
Opportunity Description Cost Payback Readiness
Bio-fuels and production by-products can form an alternative to natural gas and may include sawdust, captured methane (from effluent treatment) and oven gases from metal manufacturing. Bio fuels and 5 Many boilers and combustion systems (such as cogeneration) $$$$ <10 C alternative fuels can be modified to make use of multiple fuels to offset purchased natural gas. Sources of alternative fuels may be available on site or may be purchased. Cogeneration (also known as Combined Heating and Power (CHP)) systems generate electricity from combustion (typically FUEL SWITCHING natural gas but biogas is also possible), and use the waste heat to provide hot water or steam. ‘Trigeneration’ refers to the same Cogeneration process but waste heat is also used by an absorption chiller to 6 and $$$$ <10 B create chilled water. The electricity produced by these systems is trigeneration cleaner and more reliable than grid electricity in some locations, but becomes less financially viable if gas prices rise faster than electricity prices. Maintenance requirements also need to be considered in the financial assessment. Solar thermal systems can use a variety of technologies to concentrate solar energy to heat a fluid such as molten salt, thermal oil or water. The thermal fluid can then be used for process heating, steam generation or electricity generation, 7 Solar thermal and can be stored for 8-10 hours to provide a thermal energy $$$$ 10+ D source when sunlight is unavailable. This is currently an emerging technology with a large potential to reduce or eliminate gas consumption. A large area is required to implement a solar thermal system with a very high capital cost.
PAGE 25 5 How to assess energy intensity
Understanding and changing the energy-intensity of 1. Measurement and analysis of gas consumption data any manufacturing process is complex. Experience points to a clear five-step process to continuous Energy losses associated with gas consumption are often not immediately improvement of energy use. obvious, as the losses are invisible: heat is dissipated, transparent gas is leaked or efficiency within closed pipelines is poor. FIVE STEPS TO CONTINUOUS IMPROVEMENT That is why quantifying and monitoring energy use is so important, so your business can effectively manage its consumption and cost on an ongoing 1. ANALYSE basis. GAS DATA It’s important to look at the overall consumption of the system, the individual consumption of each unit operation, and the interaction of the unit operations. This ‘systems approach’ establishes an understanding of the material and energy flows within the system. 5. MEASURE ENERGY 2. ESTABLISH AND VERIFY MONITORING AND BASELINE AND In an era of high gas prices, a good EFFECTIVENESS TARGETING TARGETS sub metering system and reporting is an essential management tool for businesses with a high exposure to gas.
Businesses should aim to have individual gas sub meters for each major appliance of the plant, allowing the distribution of gas load to be established. If steam is utilised onsite, total steam generation 4. IMPLEMENT 3. IDENTIFY and major steam applications should THE HIGHEST AND RANK RANKED OPPORTUNITIES also be sub metered. All gas and OPPORTUNITIES TO IMPROVE steam meters should take into account temperature and pressure to give a true indication of the energy content of the stream.
PAGE 26 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
2. Establish baseline and 3. Identify and rank 4. Implement opportunities targets opportunities An iterative approach to conducting Measurement of energy content alone Once this base level of information is upgrades is often effective – that is, is not adequate to manage the gas established, unit operations should be implementing an upgrade on unit system. Where possible, secondary ranked based upon: operations that consume the most factors should be measured to allow energy, assessing the energy impact 1. Size of energy consumption the energy to be converted into a key and how the upgrade has interacted performance indicator (KPI). 2. Quality of data available with other units, then reassessing the next largest energy consumer and 3. Possibility for energy efficiency For example, gas energy into a boiler potential savings. can be measured in relation to steam improvements. energy out of the boiler to establish At this point, detailed analysis of the 5. Ongoing measurement and the boiler’s energy efficiency. Or gas unit operations that consume the verification of effectiveness consumption for a process heating most energy should be undertaken to application can be measured and Following the implementation of an fully understand the unit’s operation related to units produced to create a initiative, it is important to conduct and develop a list of potential energy meaningful KPI (GJ/1000 production measurement and verification with efficiency initiatives. This may involve units). These straightforward KPIs can comparison to the baseline to ensure engaging a specialist to provide provide businesses with real visibility the initiative is successful and achieving systems/equipment specific review and into how productive you are being the objective established in the business more detailed measurements. Internal with the energy you are using, and the case. This presents an opportunity to business cases can then be developed information you need to improve that make adjustments to energy initiatives for project approval. productivity over time. Effective sub until the energy objectives are achieved. metering is essential to establishing Ongoing monitoring is also crucial after KPIs of this kind. you’ve undertaken an energy saving project; initially to establish that the targeted savings have been achieved, and then to ensure they are maintained. A range of energy management systems are available from different technology providers that can provide managers with an easy to interpret summary of their energy use and performance against KPIs.
PAGE 27 Essential skills for 6 energy efficiency projects
PAGE 28 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
A successful gas efficiency or fuel Projects with access to the skills and Confirm that these following skills and Essential skills for switching project needs a multi- expertise below have proven to be more expertise are present in the project team disciplinary team with a ‘can-do’ successful. by reference to previous project work, attitude, and strong management and reports and outcomes. energy efficiency projects leadership to ensure that the different A high level of skill and deep expertise A starting point for identifying potential technical disciplines work together in in all of these areas may not be found in service providers is available on the an integrated way to deliver the best one individual. Rather comprehensive Energy Efficiency Council member possible outcome. Integration is the key projects are most commonly database: to excellent long-term outcomes. undertaken by a team under expert and www.eec.org.au/membership/ experienced leadership. overview#/members.
ESSENTIAL SKILLS FOR ENERGY EFFICIENCY PROJECTS: TOP 10
Leadership & project Management Energy consumption, analysis 1. Leadership and 4. Business case 7. Energy efficiency, project management development and fuel switching and - ability to effectively lead project justification generation technologies and manage a gas - ability to undertake cost - understanding of energy Leadership & project Management Energy consumption, analysis Business case development Client procurement options Systems and processes efficiency or fuel switching benefit analysis and Energy e ciency Commissioningefficiency, and tuning fuelRisk management switchingStakeholder project in its entirety, from develop business cases. and generation scoping throughLeadership to & project Management Energy consumption, analysis technologies, systems and completion. 5. Client procurement processes.
Business case development Client procurement options Systems and processes options - ability to advise 2. Energy consumption, clients on the 8. Commissioning and assessments and analysis procurement models tuning - ability to ensure Business case development Client procurement options Systems and processes - understanding of energy available, and the most equipment is consumption, collection, appropriate model for a appropriately Leadership & project Management Energy consumption, analysis billing, modelling and given project. Energy e ciency Commissioning and tuning commissionedRisk management Stakeholder and tuned.
analysis,Leadership & project Management and abilityEnergy consumption, to analysis oversee energy 6. Interdependencies 9. Risk management assessments and audits. between systems and - ability to effectively Business case development Client procurement options Systems and processes processes and managing manage the risks 3. Measurement and operational impacts associated with a gas Business case development Client procurement options Systems and processes verification of energy - ability Energyto e ciency ensure Commissioning and tuning Risk management efficiencyStakeholder or fuel switching savings - ability to integration between project.
Leadership & project Management Energy consumption, analysis oversee a robust process systems and processes for measurement and whilst managing the 10. Stakeholder verification of energy operational impact of a engagement - ability to savings. gas efficiency or fuel effectively manage the switching project. stakeholders associated Business case development Client procurement options Systems and processes Energy e ciency Commissioning and tuning Risk management Stakeholder with a gas efficiency or fuel switching project.
PAGE 29 Financing gas efficiency and 7 fuel switching projects
PAGE 30 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
1. Financial Considerations
COSTS PAYBACKS NET PRESENT VALUE • What is the upfront capital Understanding the value of a project An alternative or complimentary expense (CAPEX) cost? can be as unique as your business approach when considering the • Are there any ongoing itself, with investments in energy often payback of an investment can be to maintenance, fuel or electricity providing advantages beyond just determine the Net Present Value (NPV). operating costs relating to the cutting bills. However, there are several NPV is used to calculate the present investment? easy methods to begin to understand value of an investment by the the financial benefits in the long term. • Can cost uncertainty be removed discounted sum of all cash flows These include: by fixing-in these future operating received from the project, providing an costs? estimate of how profitable the project SIMPLE PAYBACK or RETURN ON or investment will be. INVESTMENT REVENUES OR AVOIDED This calculation demonstrates the value of all future cash flows (positive COSTS A simple payback is the period of time required to recoup the cost of the and negative) over the entire life of an • What are the cost savings from the investment, or to reach the break-even investment, discounted to the present, project? point. with the initial investment a negative - This can be measured in It can be calculated as follows: cash flow showing that money is going absolute $/GJ of gas or $/kWh of out as opposed to coming in. electricity or in $ per unit output, To consider the NPV of the investment, Initial CAPEX i.e. fuel or electricity savings over speak to your bookkeeper, accountant the lifetime of the equipment. Projected Annual Savings or financial advisor for further details. - While some investments in (Avoided Costs – Operating Costs) energy efficiency can contribute to revenue, most improve profit margins and project viability by = Simple Payback (in years) reducing or avoiding operating costs. For example, an investment of $40,000 • How are the avoided fuel or on equipment, which avoids the need electricity costs expected to to spend $12,000 of ongoing gas costs change over the project lifetime? and requires $2,000 of annual, ongoing • Are there any other savings that maintenance operating costs, the can be attributed to the project, payback would be 4 years. such as savings from changes in associated processes, i.e. reduced $40,000 product handling or transport costs from process redesign? $10,000 ($12,000 - $2,000)
= 4 year Simple Payback
It is also worth considering, what are the gains once the investment has paid for itself? If an investment provides further value or efficiency to the company, it may be justified to accept a longer payback period.
PAGE 31 2. Financing Options
Finance Option Description Advantages Disadvantages
Self-funded From balance sheet / • Suitable if the investment • Less capital available cashflows. is smaller, or cashflows are for investment in core sufficient to support the business activities. expenditure, as may be simpler to organise. • Suitable if the investment doesn’t fit into existing debt arrangements. • No ongoing repayment costs directly related to the project. Asset / equipment A financier provides capital • Reduced or no upfront • Interest rates for loans loan to a borrower to finance a costs for the project. secured against the specific project or piece of equipment can be higher (e.g. chattel mortgage, equipment. • Loans are generally than general business commercial loan, secured against the lending interest rates. equipment loan) Repayment profiles can equipment. be tailored to suit the borrower’s cashflow, such as • Repayments are generally interest-only with balloon fixed and known in (lump sum) repayment, credit advance and can be finance (equal payments per tailored to cashflows. period), or other tailored • There are loans specifically repayment profiles. designed for energy efficiency projects, which generally have lower interest rates and longer finance periods. Asset / equipment The equipment is owned • Reduced or no upfront • Interest rates for leases lease by the financier and the costs for the project. secured against the borrower obtains the sole Interest charges can have equipment can be higher (e.g. finance lease, Hire right to use it. tax advantages. than general business purchase, operating lending interest rates. TRADITIONAL FINANCING OPTIONS lease) The borrower pays regular • Leases are generally payments to the financier. secured against the Ownership may transfer to equipment. the borrower at the end of • Repayments are generally the lease period. fixed and known in advance, and can be tailored to cashflows.
PAGE 32 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
Finance Option Description Advantages Disadvantages
Environmental / Finance to make • No upfront costs for the • Currently available in Building Upgrade environmental upgrades project. selected local council Agreement (EUA) to existing premises that regions across New South improve energy, water or • Loan repayments made Wales, Victoria and South waste efficiency or increase through a local council Australia. renewable energy. charge on the land (paid via Council Rates). • Limited to existing, non- Different from traditional residential/commercial financing options, an EUA • Allows owners to use buildings only. is secured and tied to the energy savings to pay back property rather than an project costs or reduce owner. energy bills for tenants. • No mortgage security required. Energy Services An Energy Services • Reduced or no upfront • Can be a higher cost than Agreement (ESA) Agreement (ESA) provider costs for the project. using other finance options will offer a ‘turn-key’ in isolation, due to transfer OTHER FINANCING OPTIONS solution. • Interest charges can have of risks to ESA provider. tax advantages. The provider designs, constructs, owns and often • Implementation and maintains equipment. operating risks are borne by the ESA provider.
3. Accessing finance 4. Government support and Energy Savings Schemes Businesses looking for ways of financing energy efficient equipment have several The Federal government, along with CEFC options available to them. By multiple State and local governments teaming with major Australian banks provide incentives for gas energy and specialist finance providers, it is efficiency and fuel switching projects via easier for businesses and consumers to grants and Energy Savings Schemes. secure discounted interest rate loans For up-to-date information on available to make clean energy improvements incentives please visit the Energy and upgrades. These programs are Efficiency Council website: targeted to the clean energy needs of www.eec.org.au. smaller-businesses, manufacturers and the agricultural sector, as well as smaller- scale commercial property.
For information about CEFC co-finance arrangements, please visit cefc.com.au
PAGE 33 8 Case studies ABATTOIR AND MEAT PROCESSOR A large modern abattoir and rendering plant is a supplier of sheep meat, skins, wool, co-products, cotton, grain and pulses to the global market. The site is a large energy user, relying heavily on substantial volumes of natural gas to produce steam for further processing and hot water production. The abattoir has invested in energy efficiency measures for the plant in the past, however recent gas price escalations highlighted a pressing need to further reduce site energy consumption. At the same time, the managing director was eager to take advantage of the New South Wales Government’s Gas Efficiency Program and Energy Savings Scheme. Run by the Office of Environment and Heritage (OEH), the scheme offers subsidies to offset the size of any energy saving investments, and ultimately improve returns.
Opportunities implemented Outcomes The site team responded pro-actively • Replacement of a steam strap with The implementation of these initiatives to the price shocks by embarking on a a condensate pump to redirect was able to: program of significant energy upgrades condensate from the drain back to the • Reduce gas consumption by 21% across its facility. Project opportunities feedwater tank (24,817 GJ/yr) in the boiler house and steam system • Blowdown heat recovery systems were were identified as the fastest path to • Monthly gas savings of $45,000 per also installed to recover heat lost to cutting gas consumption. month boiler blowdowns: The project team focused on the • Reduction in boiler water - Installation of a TDS sensor based following key opportunities: consumption of 8ML per annum blowdown system • Automated temperature control of • Reduced chemical use of $10-$15K - Installation of a blowdown flash tallow tanks per annum steam heat recovery system • Flash steam and condensate recovery With a total investment cost of - Installation of a blowdown residual to provide hot water $443,000, the project was able to heat exchanger provide a payback in under 10 months. • Steam pressure set point adjustment • Installation of two heat recovery allowing one of the boilers to be systems on flash steam that was decommissioned previously vented to atmosphere. • Installation of a new boiler feed tank with de-aerator and recirculation system quenching the flash steam (old tank was poorly insulated and had no de-aerator)
PAGE 34 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
BEVERAGE MANUFACTURER A manufacturing and distribution site for non-alcoholic soft drink products. The site operation is 24 hours per day 365 days per year with one primary steam boiler rated at 6MW. The steam produced from the boiler feeds production process including bottle warming and process cleaning, with a small portion used for hot water generation to supply the kitchen and toilet facilities.
Opportunities implemented Outcomes Installation of a combustion analysis The implementation of this initiative • Gas savings of $14,800 per year control system on the steam boiler. was able to: With a total investment cost of $11,850, • Reduce gas consumption by 9.5% the project was able to provide a (2,004 GJ/yr) payback in under 10 months.
BUILDING PRODUCTS MANUFACTURER A building products manufacturing plant producing various types of fibre cement products for the building industry such as weatherboard, flooring, eaves and soffits and internal wall linings.
Opportunities implemented Outcomes A new control system was installed • Water level control The implementation of this initiative on its 8MW boiler at this plant. The was able to: • Pressure and temperature set-point control system includes various features control • Reduce gas consumption by 5.6% to improve combustion and reduce (5,444 GJ/yr) emissions: • 3 Parameter trim (fuel/air ratio) based on exhaust gas O2, CO2, and CO • Gas savings of $42,000 per year • High precision control of air and gas valves and dampers using servo • TDS control with top and bottom With a total investment cost of motors blowdown $119,600, the project was able to provide a payback in under 3 years. • VSD on the combustion fan • Installation of steam flow meter
FOOD MANUFACTURER This site manufactures a wide range of small food products & utilises a small (2.5MW) steam boiler to support the production processes.
Opportunities implemented Outcomes The boiler previously utilised an The implementation of these initiatives • Gas savings of $9,500 per year injection nozzle style burner. This nozzle was able to: With a total investment cost of $59,400, was replaced with a Weishaupt burner • Reduce gas consumption by 6.9% the project was able to provide a with an integrated VSD to supply (797 GJ/yr) payback of 6.2 years. combustion air and an oxygen trim control system.
PAGE 35 9 Glossary
Term Definition
Boiler blowdown Boiler blowdown refers to the periodic release of hot water from a boiler to purge the build-up of Total Dissolved Solids (TDS). This prevents the build-up of minerals within the boiler that can foul the heat transfer surface and reduce efficiency of the boiler.
Clean In Place (CIP) Clean In Place (CIP) is a common term for the industrial cleaning of process lines and equipment which remain in a fixed location on the site. This often involves a number of rinse cycles with hot water and various chemical solutions.
Condensate This is the liquid formed once heat is removed from steam. As heat is removed from the steam, it changes from a gas to a liquid (a process known as condensation).
De-aerator A de-aerator is a device used in steam systems to assist with the removal of oxygen and other gases from the incoming water stream. The de-aerator is often part of the feed water tank.
De-superheater A device which reduces the temperature of superheated steam (back to being saturated steam) so that it can then be used effectively for heat transfer applications.
Flash steam Flash steam is produced from hot condensate at a high pressure experiencing a rapid decrease in pressure. This results in some of the condensate’s heat energy converting the water to steam (a process known as evaporation).
Purge cycle Purge cycle refers to the venting of air and gases within a combustion chamber during the ignition or start-up phase. This is a necessary safety measure to eliminate a build-up of combustible gases.
Pressure Reduction Valve (PRV) A device commonly installed on steam systems to reduce the pressure of the steam in a pipe down to the desired pressure for use in a particular application.
Saturated steam Saturated steam is the hot vapour that forms from the evaporation of water.
PAGE 36 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
Term Definition
Supervisory Control And Data Supervisory Control And Data Acquisition (SCADA) systems are commonly present on Acquisition (SCADA) industrial sites and are a control system utilising computers and networks to connect to equipment and devices.
Super-heated steam Super-heated steam is saturated steam that has been further heated to increase its temperature.
Radiant losses Radiant losses refer to the undesirable heat transfer from a hot surface to the surrounding material or medium. For example, a hot pipe will have radiant heat losses into the surrounding cooler air.
Refractory Refractory material or refractory bricks refers to a material that is resistant to heat. It is commonly used as a lining within boilers, furnaces and high temperature applications to contain the heat of combustion.
Thermal energy Thermal energy is the internal energy of a substance as a result of its temperature. For example, water at 90°C has more thermal energy than water at 25°C.
Total Dissolved Solids (TDS) This is a measure of the quantity of dissolved mineral and salt components within water. The higher the TDS content, the more likely scaling is to occur within the boiler, reducing efficiency.
Thermal imaging Also known as Infrared Thermography. This is a method for visualising heat losses by converting heat radiating from a surface into a coloured temperature scale.
Variable Speed Drive (VSD) A device fitted to an electric motor that regulates the speed of the motor through manipulation of the electrical energy.
Water softener A water softener is a device installed on the boiler make-up water. It contains resin beads with salt to remove hard water mineral components, such as calcium and magnesium. These minerals would otherwise readily precipitate within the boiler, creating scale which reduces the boiler’s efficiency.
PAGE 37 PAGE 38 AUSTRALIAN MANUFACTURING GAS EFFICIENCY GUIDE
Clean Energy Finance Energy Efficiency Council Ai Group Corporation The Energy Efficiency Council is Ai Group has been a leading industry The CEFC is responsible for investing Australia’s peak body energy efficiency, association in Australia for over 140 $10 billion in clean energy projects on energy management and demand years. Our membership includes behalf of the Australian Government. response. The Council is a not-for- thousands of businesses across key Our goal is to help lower Australia’s profit membership association focused sectors of the economy such as carbon emissions by investing in on making sensible, cost-effective manufacturing, construction, labour hire, renewable energy, energy efficiency and energy efficiency measures standard defence, ICT, food, pharmaceuticals and low emissions technologies. We also practice across the Australian economy. confectionery. support innovative start-up companies The Council works to promote through the Clean Energy Innovation stable government policy, provide We intrinsically understand the Fund. Across our portfolio, we deliver a clear information to businesses and challenges facing industry and remain positive return to taxpayers. householders and drive the quality of at the cutting edge of policy debate energy efficiency products and services. and legislative change – and strategic cefc.com.au business management. We work to eec.org.au provide our members with the practical information, advice and assistance they need to run their businesses more effectively, and provide a powerful representative voice at all levels of government through our policy leadership and influence.
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