How to gain competitive advantage from sustainable energy

According to the International Energy Agency, the industrial sector consumes around 54% of the world's total delivered energy. Energy intensive processes, involving heating, cooling, power and ventilation, mean that energy is a major overhead for most industrial manufacturers. Unless properly managed, it can also be a huge source of carbon emissions.  

Balancing commercial & environment goals

The most environmentally advanced businesses demonstrate that energy sustainability and profit go hand-in-hand. This is revealed by our survey of more than 1500 global business leaders, which showed that the greenest businesses are 2.5x more likely to be the strongest financial performers.

Many of these businesses are taking a decentralised approach to become energy prosumers rather than consumers. They're transforming energy from a fixed cost into a valuable asset, resulting in four key benefits:

1. Control and reduce costs - by using energy more efficiently and flexibly; producing power and heat/cooling more cost effectively, and generating income from monetising power flexibility.

2.  Improve operational efficiency - by gaining full visibility of energy waste and  identifying vulnerabilities in key processes and equipment.

3.  Improve energy resilience - to de-risk business operation by ensuring continuity and avoiding costly unscheduled downtime.

4.  Enhance environmental performance - to deliver on sustainability goals, meet stakeholder expectations and enhance brand reputation. 

New distributed energy opportunities

Advances in distributed energy technologies, digitalisation and new financing models are opening up affordable new opportunities to make long-term energy cost and carbon savings..But what are the best technologies and solutions to  transform energy and operational performance in industry?

Advanced energy insights

Industrial businesses have very different requirements and challenges, so each will follow its own individual sustainable energy pathway. However, it is essential for all organisations to gain complete visibility of how, when and where they are using energy across their entire estate. This means looking beyond the traditional metered data to gain a deep understanding how energy is being consumed across energy intensive equipment and processes.

With an energy management strategy that utilises real-time energy intelligence  to identify energy inefficiencies and wastage, businesses gain full vision of their energy and asset performance. This yields actionable and accountable energy insights to help companies improve cost and carbon performance, while also increasing production efficiency and resilience.

Wireless sensors linked to an analytics platform can pinpoint exactly how energy is being used, right down to the device level – identifying key areas to address for improved energy and operational efficiency.

Being able to monitor power-consuming, critical assets entails a simple installation process – at the circuit breaker. The sensors snap onto the outgoing electrical wire that powers each device, without disrupting operations.

Anomalies picked up by the Internet of Things (IoT) energy analytics software can be symptomatic of deep-lying faults in plant equipment or weaknesses in operational performance that are difficult to detect.

With energy intelligence, plant managers can inform  maintenance requirements to reduce downtime and increase productivity. It's sometimes possible to  identify potential equipment failures before they happen.

This advanced approach to energy intelligence is working for global building materials specialist CEMEX, which has achieved  cost savings and efficiency improvements at sites across the UK by using our Internet of Things (IoT)  software analytics and monitoring technologies.

By gaining  comprehensive and real-time insights into energy consumption and asset performance, CEMEX was able to identify inefficiencies, wastage and gain an overview of the overall health of its assets. This has enabled the company to implement energy reduction and process optimisation improvements.

CHP pays off

Many industrial sites have reduced their dependency on the electricity grid by generating low cost, low and zero carbon energy on-site.  Industrial sites are the biggest users of Combined Heat and Power (CHP)/cogeneration, which  can deliver major energy cost savings, compared to purchasing network electricity and using boilers to provide heat.

CHP achieves substantial energy savings by recycling the heat (that is wasted in centralised power production) as part of a single, high efficiency cogeneration process. In addition, there are no transmission losses in transporting power to end users from remote central generators.

The key cost saving advantage of cogeneration is spark spread (the difference in price between purchasing grid electricity and the natural gas used to generate that power). Gas prices have been substantially lower than power prices for many years, resulting in a highly favourable spark spread. CHP can thus deliver huge cost savings, while providing a secure and flexible energy supply. 

The financial benefits of CHP are evidenced by a rapid return on investment – often delivering a payback within 2-3 years, which makes it one of the best energy-saving solutions available. This provides opportunities for organisations to use cost efficiencies to fund pure green technologies with longer paybacks and more marginal economics.

CHP can also be used flexibly to reduce peak-time electricity costs or generate revenue via Demand Side Response. The potential to cluster energy assets in a decentralised smart-grid or virtual power plant is exciting and likely to become more commonplace in the future.

Centrica's CHP/trigeneration technology is supplying uninterrupted power to  Continental Automotive, along with high efficiency heating and cooling. We're protecting the manufacturer from grid outages to ensure production resilience, while reducing carbon emissions by 14% and avoiding rising energy costs.

Generating high grade heat affordably and sustainably is a huge challenge for industry, but high temperature heat pumps are now being used to supply high carbon intensity heat processes, such as drying, pre-heating and distillation. A waste heat interface recovers  heat from site processes, or CHP plant, and supplies it to the heat pump, which then upgrades the heat to a higher temperature. This can be used in processes, to  generate low pressure steam, or provide high temperature hot water.

Maximising renewable power

In a recent Centrica survey, over a quarter of the manufacturing respondents said that they had installed solar photovoltaic panels at their sites. We are helping Toyota to power production at one of its European Model Sustainable Plant at Burnaston.

Plant managers can increase renewable energy utilisation by combining battery storage and using stored power to avoid peak-time network electricity costs. In this way, they can optimise energy flexibility to generate income via the most lucrative demand side response (DSR) opportunities. Our Artificial Intelligence Virtual

Power Plants are taking DSR to a new level by aggregating multi-site distributed energy resources to maximise flexibility revenues.

As manufacturing and engineering businesses shift their fleets to electric vehicles, they can maximise the value of their on-site generation and storage assets by integrating them with on-site EV charging infrastructure.

For those sites that can't  install on-site renewable generation or storage, or who aren't ready to make the commitment, Corporate Power Purchase Agreements (PPAs) provide an alternative. PPAs can provide rapid, verifiable, low-cost emissions savings and support the growth of additional new renewable infrastructure.
Businesses that are reluctant to invest capital in sustainable integrated energy projects,  can fund infrastructure off balance sheet via flexible finance options.

Advanced distributed energy solutions are proven to deliver such strong and predictable returns, that major investment can be delivered through an operating cost model.

John Hyde is head of distributed energy commercial sales at Centrica Business Solutions

www.centricabusinesssolutions.com