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PA Manufacturer Energy Savings Report

Enspi identifies $50K savings

Executive Summary

PA MANUFACTURER is a specialized manufacturer of washers, springs etc, whose energy consumption has recently increased due to higher peak demand. This report outlines several opportunities for PA MANUFACTURER to optimize their energy costs and improve efficiency. By implementing the recommended actions, PA MANUFACTURER can achieve estimated annual savings of $40,000 to $50,000.
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Introduction

PA MANUFACTURER's operations involve energy-intensive manufacturing processes,including high-speed blanking, machining, and heat treatment. These processes,combined with lighting, heating, and other utility demands, lead to significant electricity usage and high energy bills. This report presents a detailed analysis of PAMANUFACTURER's energy usage and provides clear, actionable recommendations to reduce energy costs and improve efficiency.

Analysis of Current Electricity Usage

PA MANUFACTURER’s electricity consumption over the past 12 months shows high energy use during peak summer months. The billing period from July to August recorded peak consumption of 85,937 kWh, resulting in total charges of $6,897.76. The on-peak load during this period contributed significantly to high costs.

Key factors driving PA MANUFACTURER's energy costs include peak demand charges,reactive power penalties, and general generation and distribution costs.

Opportunities for Cost Savings and Efficiency Improvements


      1. Power Factor Correction

  • Description: PA MANUFACTURER incurs reactive power charges due to a low power factor, leading to additional costs. Installing capacitor banks can improve the power factor, reduce apparent power, and eliminate reactive power charges.
  • Current Situation: PA MANUFACTURER's reactive power charge is $714.30 per month, caused by a power factor below the acceptable threshold. A typical target power factor is 0.95 or higher, which can significantly reduce these charges.
  • Calculation: The current reactive demand is 197.4 KVAR. Installing appropriately sized capacitor banks can help offset this reactive power, improving the power factor and reducing apparent power demand.
  • Estimated Savings: $500 per month, equating to $6,000 annually.


    ‍2. Load Shifting and Demand Management

  • Description: Shifting high-energy-consuming processes to off-peak hours can help PA MANUFACTURER reduce peak demand charges. This is particularly effective during summer months when peak demand rates are highest.
  • Current Situation: PA MANUFACTURER operates two shifts, with significant energy consumption during peak hours. Shifting some operations to the "lights out"overnight shift can lower peak demand.
  • Operational Suggestions: Focus on shifting energy-intensive processes, such as heat treatment and machining, to off-peak hours (7 PM to 5 AM). Implementing automated scheduling can ensure these shifts occur consistently.
  • Estimated Savings: $800 - $1,000 per month, totaling $9,600 - $12,000 annually.


    ‍3. Automated Demand Response (ADR)

  • Description: Implementing ADR systems can automatically reduce non-essential loads during peak times, further helping to reduce peak demand charges.
  • Potential Equipment: Install ADR-capable controllers on non-critical equipment such as HVAC systems and lighting. These controllers can receive signals from the utility to reduce load during peak events.

  • Incentives: PA MANUFACTURER may be eligible for incentives from grid operators or utilities for participating in ADR programs, which can further reduce costs.
  • Potential Impact: Additional savings and eligibility for incentives related to grid stability programs.
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      4. Solar Installation

  • Description: PA MANUFACTURER can offset 55% of its energy usage by installing rooftop solar. This will reduce dependence on external power supply, particularly during peak hours, resulting in significant cost savings.
  • ROI Analysis: Assuming an installation cost of $2 per watt and a capacity of 250kW, the total cost would be approximately $500,000. With monthly savings of$2,500, the payback period would be roughly 17 years, excluding incentives.
  • Incentives: Utilizing incentives like USDA REAP and PA PACE could cover up to 40%of installation costs, reducing the payback period to approximately 10 years.
  • Estimated Savings: $2,500 per month, totaling $30,000 annually.



    ‍5. Heating and Building Renovations

  • Description: Upcoming heating system upgrades should incorporate energy-efficient systems, including improved insulation and efficient heating solutions.Leverage incentives like PA RISE for cost support.
  • Renovation Plan: Upgrade insulation in the production and office areas to reduce heat loss. Replace existing heating systems with high-efficiency units that have programmable thermostats for better control.
  • Potential Impact: Reduced energy costs related to heating and cooling, leading to better energy efficiency and improved comfort for employees.



    6. Energy Efficiency Upgrades

  • Description: Upgrading lighting and machinery for better efficiency can lead to reduced base load consumption. Incentives from PA PACE and similar programs can support these upgrades.
  • Lighting Upgrades: Replace existing lighting with LED fixtures, which consume upto 75% less energy. Estimated savings from lighting upgrades could be $150 - $200per month.

  • Machinery Upgrades: Upgrade old machinery to energy-efficient models where possible. Variable Frequency Drives (VFDs) can be added to motors to optimize energy use based on load requirements.
  • Potential Impact: Continuous reduction in energy consumption and operational costs, with potential savings of $1,800 - $2,400 annually from lighting upgrades alone.




    7. Rate Structure Review

  • Description: Engaging with West Penn Power to negotiate a more favorable rate structure could lead to reduced charges, especially during high-demand periods.
  • Current Rate Structure: PA MANUFACTURER is currently on a rate structure that
  • includes high peak demand charges during summer months. Negotiating a different
  • structure or participating in a demand response program could yield savings.
  • Estimated Savings: $400 - $600 per month, equating to $4,800 - $7,200 annually.
Summary of Recommended Actions and Expected Savings

Next Steps

  1. Power Factor Correction Consultation: Engage a specialist to assess and install capacitor banks to improve the power factor and reduce reactive power charges.
  2. Load Shifting & Demand Response Implementation: Adjust operational schedules to shift high-energy processes to off-peak hours, particularly during the summer.
  3. Solar Vendor Engagement: Begindiscussionswithsolarvendorstoscopeoutaproject to offset 55% of energy consumption.
  4. ADR and Rate Structure Negotiation: Reach out to West Penn Power to discuss alternative rate structures, demand response programs, and ADR incentives.
  5. Energy Efficiency Upgrades: Identify Lighting and machinery that could be Upgraded for energy efficiency and explore relevant incentives.
  6. Heating System Renovation Planning: Plan and Implement Energy-efficient upgrades during upcoming building renovations.


Conclusion

Implementing these energy-saving measures can lead to significant cost reductions for PA MANUFACTURER, with estimated annual savings of $52,200 to $57,600. These actions will not only lower operational costs but also enhance PA MANUFACTURER’s energy efficiency and sustainability, positioning the company for long-term success in managing energy costs.