Falling oil and energy prices, coupled with the Government’s review of alternate energy support do not mean that energy efficiency and ‘green’ manufacturing can be shifted to the back burner. Ruari McCallion casts his eye over the changing landscape.
Green, or alternate energy sources, are still regarded as something of a curiosity – something out of the ordinary, which supplement energy from “proper” sources. In fact, things have been changing, pretty significantly.
Wind power may not be totally reliable – it only works when the wind is blowing, obviously – but it is making a significant contribution to even high-intensity manufacturing consumers.
The example of Nissan tends to be trotted out when wind power is mentioned – and for a very good reason: the 10 turbines produce up to 7% of its Sunderland site’s energy needs and save it around £1m a year in electricity costs, as well as reducing its carbon footprint.
The three turbines at Ford’s plant a Dagenham, Essex, produce enough electricity to power 2,500 homes and save about 5,000 tonnes of CO2/yr.
In May 2015, Nissan submitted a revised planning application to develop 8.7 hectares of land at the Sunderland site into a 19,000 panel, 4.8MW solar farm (its previous application for a much larger facility were rejected in January).
Toyota is ahead in that particular field; its UK assembly plant at Burnaston, England, has a 17,000 panel solar array that generates 4.1 MW of electricity, which is claimed to be enough to make approximately 7,000 cars annually and helps to reduce the plant’s carbon footprint by up to 2,500 tonnes of CO2/yr.
Its Deeside engine plant in North Wales, near Chester, is comprised of nearly 13,000 panels and has a capacity of up to 3.8MW.
It says the power produced by the array will be enough to produce nearly 22,500 car engines and that the plant’s carbon emissions will fall by 1,800 tonnes a year, equivalent to the combined weight of 1,260 Auris hatchbacks.
Manufacturing: leaner, fitter – and greener?
Manufacturing has not only become leaner, more flexible and more productive in the past decade or so; it has been cleaning up its act, too – which is probably just as well, as the country’s target of reducing carbon emissions by 80% by 2050 remains in place.
Love Energy Savings (LES), a business energy price comparison website, pointed out that a report from the Department of Energy and Climate Change (DECC) included some possibly surprising statistics.
Transport is the largest consumer of energy in the country – no surprise there – but domestic usage had the second highest rate, at 27%; industry is now third, with a usage rate of just 17%.
It looks like the efforts put in to reduce consumption are now paying off. And it doesn’t stop there; because high energy users such as manufacturers have adopted green energy, sources such as wind and solar have been able to achieve benefits of scale and therefore become more viable in themselves, in a virtuous circle.
According to LES, the UK’s solar photovoltaic capacity experienced a growth of 89% due to the Renewables Obligation, which encouraged a high rate of solar panel deployment.
Just in time viability
A degree of real-world commercial viability has probably been achieved only just in time, because the Chancellor’s July Budget announced that subsidy schemes for solar panels and onshore wind farms were to be cut; the Climate Change Levy is also being eliminated.
Does this mean that we can go back to good ol’ coal and town gas? Probably not. The current low prices for oil and gas are very welcome, but history tells us they will not continue forever.
And there is the question of security of supply. Ofgem suggested last year that this winter – 2015/16 – there is a 1:12 chance of power cuts, for various reasons, including troubles in Ukraine and ISIS’ encroachment on Middle East oilfields.
You have two months to comply
Changes in ‘green’ subsidies and abolition of the Climate Change Levy do not mean that the Government has taken its foot off the legislative accelerator. The ESOS (Energy Savings Opportunity Scheme) Regulations 2014 enact Article 8 of the EU Energy efficiency Directive.
If you don’t know what that involves, you should make every effort to find out. It requires that all large businesses in the UK undertake comprehensive assessments of energy use and energy efficiency opportunities at least once every four years.
The deadline for the first compliance period is 5 December 2015. What is a large organisation? One that employs at least 250 people or has an annual turnover in excess of €50m (£37.5m) and a balance sheet in excess of €43m (£32.25m).
It is the nature of these things that requirements to comply will filter further down to smaller companies in the fullness of time, so even if your company is not that big yet, it should be aware of the requirements.
To comply, companies will have to appoint a “Lead Energy Assessor”, who will have to conduct an ESOS assessment.
It will measure your total energy consumption for buildings, industrial processes and transport; identify areas of significant energy consumption; identify cost effective energy efficiency recommendations for areas of significant energy consumption; and report compliance to the Environment Agency.
Organisations that are covered by ISO 50001 may not need to undertake the assessment; the Carbon Trust offers Lead Energy Assessors and has been working with a number of companies to help them achieve ISO50001.
It observes that the point of ESOS is not simply compliance; it is to identify opportunities to reduce energy use and therefore cut consumption, emissions and cost.
There is currently no statutory requirement to take action but failure to do so will mean that the regular ESOS assessments will be a financial outlay, while investment in the opportunities identified could help to achieve ISO 50001 certification.
So much for the regulatory and circumstantial framework. The bigger question is: how can UK manufacturing take advantage of the opportunities offered by ‘green energy’? Up till fairly recently, the answer has been: it hasn’t.
The alternative energy supply chain was notable for the absence of UK companies. However, efforts by the Government, particularly in the shape of GROW:Offshore Wind, have born some fruit, as Dominic Brown explained to The Manufacturer here.
