Taking responsibility for energy

Posted on 7 Apr 2011 by The Manufacturer

While there is consensus among the majority of academics, politicians and business leaders regarding climate change, much more still needs to be done to instigate the change necessary to maintain atmospheric CO2 at an acceptable level. Reducing energy consumption is key to this change but perhaps, as an energy intensive sector, manufacturers need to do more. Tim Brown explores alternative energy use within manufacturing.

Nuts & Bolts

In this article you can find out:

● The science supporting the idea of human influenced climate change is growing stronger and the previous concerns may have been understated.

● The Government has initiated its Renewable Heat Incentive (RHI) scheme and will grant subsidies worth £860m for geothermal heat pumps, solar thermal plants and biomass boilers.

● Heating is responsible for almost half (46%) of the UK’s climatechanging emissions, mostly from heating rooms and water in homes and workplaces.

● Ford Dagenham has this year committed to install its third wind turbine.

● Not all manufacturing businesses are suited to alternative energy sources.

The implementation of an economic level playing field through a global approach to carbon trading is unlikely to emerge in the foreseeable future. While many developing nations and emerging economies such as China and India continue to baulk at the suggestion of a global carbon price, developed economies will have to shoulder the burden of initial cap and trade schemes if they are to gain traction.

What’s more, gas prices rose by 20 per cent in 2010 and energy prices are likely to continue to climb and the science supporting the idea of human influenced climate change is growing ever stronger and, if anything, the previous findings are now considered somewhat understated. Thus the impetus for action is obvious. Finding new and more efficient ways to power industrial sites is becoming an increasingly important strategy to maintain both prosperity and environmental sustainability.

While most businesses have now implemented an environmental strategy, the uptake of onsite renewables and alternative energy generation is still in its infancy. A raft of options exists for the generation of energy and heating that will not only reduce utility bills but are also more environmentally friendly.

Hot Facts

● Heating is responsible for almost half (46%) of the UK’s climate-changing emissions, mostly from heating rooms and water in homes and workplaces.

● The Renewable Heat Incentive could cut carbon emissions by 60 million tonnes in a decade. That’s the equivalent of taking almost 2.5 million cars off the road every year for ten years.

● The UK is committed to producing 12% of heat from renewable sources by 2020 – it is currently just 1%.

Last month the Government initiated its Renewable Heat Incentive (RHI) scheme aimed not only at decreasing energy use but also at generating £4.5bn of investment for the green economy.

The Department of Energy and Climate Change (DECC) says it will grant subsidies worth £860m for geothermal heat pumps, solar thermal plants and biomass boilers.

The Incentive will include a tariff paying a fixed amount per kilowatt-hour of heat produced over a 20-year period. It will apply to heating systems installed by homes, industry and government since July 15, 2009. Following parliamentary approval for the rules – due in July – £15m will be made available to help cover the price of renewable heating systems for 25,000 households. The rest of the incentives, including for businesses, will be phased in over the following 18 months.

The world’s first financial incentive of its kind to revolutionise the way heat is generated and used in buildings was launched by Energy Secretary Chris Huhne. “Renewable heat is a largely untapped resource and an important new green industry of the future,” he said. “This incentive is the first of its kind in the world. It’ll help the UK shift away from fossil fuel, reducing carbon emissions and encouraging innovation, jobs and growth in new advanced technologies.” In addition, unsecured interest-free Energy- Efficiency loans of up to £100,000 (£200,000 in Northern Ireland) are available for SMEs through the Carbon Trust for replacing or upgrading existing equipment with a more energy-efficient version to fund projects such as lighting, boilers or insulation. A similar scheme is managed by Loan Action Scotland.

Natural gas powered micro-CHP units (micro combined heat and power) generate electricity and utilise heat by-product to provide an efficient mechanism for producing both. Companies such as Ener-g provide significant incentives to install one of their CHP systems, often with no upfront cost and a significantly reduced energy bill.

Wind energy finds a fan in Ford
Of course heating is far from the only onsite alternative energy source available. Ford Dagenham has this year committed to its third wind turbine which will be installed on the eastern edge of the site later this year. The three blade turbine, standing 120 metres tall, will take up its prominent residence alongside the Thames and in doing so will increase the site’s production of clean electricity from 6.7 million kilowatt hours to 11.5 million kilowatt hours (enough to power 1,400 homes).

Ford’s existing two turbines, standing either side of the Dagenham estate, power the Dagenham Diesel Centre, where production volumes of low-carbon engines are rising. The third turbine was ordered to maintain the plant’s green energy supply. Planning permission was granted for the new turbine last year.

Joe Greenwell, Ford of Britain chairman, said: “Ford Dagenham is at the forefront of sustainable business – in both its manufacturing technology and its products. Low emission cars are increasingly in demand, with Ford’s ECOnetic range leading on performance and production.” Dale Vince, managing director of wind turbine partner Ecotricity, added: “When household names like Ford use windmills for their everyday operations, it’s a sign that wind energy has come of age. It’s special to see demand for cleaner engines grow – and built by the power of wind.”

Look before you leap
International consultancy Environ works with clients to help resolve their most demanding environmental and human health issues. Although a proponent for environmental improvement, company principal Dave Covell says investing in renewable energy is not always the right decision for companies.

“Not all manufacturing businesses are suited to alternative energy sources. The main issue is that many industrial sites, particularly those with large energy consumptions, can only ever hope to generate a very small percentage of their energy from renewable sources,” says Covell.

“For many manufacturing businesses it could cost far more to set up and install alternative energy than could ever be clawed back and would not be a sensible business decision. Often, much better financial returns can be made through investing in upto- date energy efficiency technologies like modern air compressors and intelligent control systems.” According to him there are often also location restrictions, with many manufacturing sites being short of space for core activities, let alone having space for alternative energy technologies.

Additionally, many could face planning constraints – locations close to residential areas will find alterations to the appearance of their premises, or additional noise, however well-intentioned, hard to achieve through the current regime and emerging localism agenda.

“As a rule of thumb, for businesses where energy is more than about 30% of operating cost or where profit margins are very small and energy costs relative to profit made are significant, looking at energy efficiency is a much better option for increasing overall profitability. These companies should make sure they fully understand their energy consumption and the reasons why it varies and as a starting point try and identify what their base load energy requirement is and minimise this.”

However, Covell does concede that for certain businesses alternative energy is a viable choice. The best approach, he says, is to look for synergies within a business to make the overall process as efficient as possible. “For instance wood, paper and packaging companies can burn their waste to generate heat, while dairies and food manufacturers can use anaerobic digesters to convert their waste products into energy.” Indeed a host of alternative energy sources are available onsite and as Covell rightly points out, playing to the existing strengths of the company is important when considering making the investment in onsite generation. Regardless of the risks, it cannot be denied that under the right circumstance and with the right management, the potential for great rewards exist in the alternative energy arena.

No matter whether it be solar, wind, thermal, anabolic or biomass, there are enough options available to investigate whether alternative energy is right for your business and, for the sake of the environment, the time to act is now.