Energy Audits Pinpoint Ways to Save

Feb. 8, 2005
Talk about ROI! Make a no-cost energy audit your plant’s next investment.
Old school thinking had it that energy usage was pretty much a fixed cost on the operations ledger. While that notion has faded under the influences of deregulation, fluctuating costs, energy shortages and waves of new energy purchase and conservation strategies, many food processing companies have yet to give energy management the attention it merits.That’s a mistake. Fortunately, it is one that can be easily and economically rectified beginning with an energy audit of your plant and operations network. There’s no reason to waste your energy today. No-cost and low-cost energy audit opportunities often are only a phone call or an e-mail away. Furthermore, utility companies themselves are realizing the benefits of helping customers and prospective customers manage their energy wisely. They realize that a company they can help control and manage its costs is more likely to remain a long-term customer.A good energy audit will consist of a comprehensive examination of a plant and its processes, along with its energy bills, meters and other systems of measure, to determine energy usage, cost and efficiency. An effective auditor also will alert the processor to the best available options in energy-saving equipment, energy purchasing, scheduling, rebates and financing options for energy-related constructions, installations and upgrades.Some food processors are ahead of the general curve for American industry when it comes to energy-saving savvy. Some even have made a high priority of energy conservation and efficiency in their plant systems and have benefited handsomely as a result.

Is energy management a priority within your company? Energy management may not be part of your job, but it should be an explicit part of someone’s job description. Moreover, it’s everyone’s responsibility.

Check with manufacturing, engineering, maintenance and operations executives and with plant managers, logistics heads and others in charge of energy-intensive operations regarding energy auditing and implementation of best practices.

Offices, too, should be audited for energy efficiency, and office personnel indoctrinated into energy-saving practices. Adopting and implementing best practices in energy management will almost certainly produce quick savings. Revisiting those practices regularly will assure those dollars don’t slip through the cracks later on.

ConAgra Foods Inc., Omaha, Neb., for example, gives awards to its production facilities for outstanding energy savings through its Sustainable Development program, which recognizes company efforts that simultaneously enhance the environment and the corporation’s bottom line. Its 2004 award winners included modification of boil times and temperature for the sanitation systems at a grocery products plant in Trenton, Mo., and a project that recycled blanch water for heat recovery and reuse in a potato products plant in Park Rapids, Minn. One purpose of the Sustainable Development program, which has slashed more than $60 million from the corporation’s operating costs in the past five years, is to seed other plants and divisions of the sprawling ConAgra production network with proven money-saving concepts. The Refrigerated Foods Group received Best Practices recognition for reducing energy consumption at all plants by 3 percent. At least one divisional engineering head has hired a prominent engineering firm to conduct extensive energy audits at all of the division’s plants to extract comparable savings in 2005 and beyond.Grab low-hanging fruitEnergy guidelines and gurus can be found almost anywhere. But a lot of the guiding wisdom today derives from the simplest of principles: Use energy only at the exact time, the exact place and in the exact amount you need to produce the volumes and quality your customers require.While that principle sounds simple, the breadth of its application consistently escapes many food processors. Energy providers point out most companies focus on the energy consumed by lighting, heat and other basic facility requirements. These costs comprise only about 40 percent of the average manufacturer’s energy costs and, in an energy-intensive business like food, they may comprise an even smaller percentage. A sharp-eyed energy savant may uncover countless points along production lines for energy savings and help slash the cost of that other 60 percent of the plant’s total energy bill, which often is invisible to management. While independent energy use experts may find solutions that escape conventional audits, such resources are not always cheap. And while they may well be worth their fees over time, you may want to start with no-cost and low-cost audits to identify the low-hanging fruit that yields quick and easy energy and cost savings. Utility companies across the country provide audits that not only help identify the energy wasters in your plant, but also unveil cost- or energy-saving options you may not have known existed.The federal government and many states, too, offer free energy audits, rebates and other incentives plus financing options that can make energy-efficiency upgrades affordable -- even painless. The federal government’s Industrial Assessment Centers program (www.oit.doe.gov/iac) provides comprehensive industrial assessments at no cost to manufacturers. Teams of engineering faculty and students from 26 universities located across the country conduct energy audits or industrial assessments, and advise manufacturers on ways to save energy, as well as reduce waste and improve productivity. Universities with high-profile engineering departments often can provide energy audits that go beyond the scope of a utility-directed audit. “The University of Florida in Gainesville has a program that trains industrial engineers. It will send students and faculty to conduct very comprehensive audits,” says Rob Jennings, account manager for TECO Energy Inc. and its regulated utility subsidiary Tampa Electric Co. (www.tampaelectric.com). “They may make recommendations on waste management and other things beyond energy that can also save a company money.”The U.S. Dept. of Energy’s Industrial Technologies Program (ITP) (www.eere.energy.gov) invests in “leapfrog technologies that will provide dramatic energy and environmental benefits,” according to promotional material. ITP provides cost-shared funding for research and development projects. Collaborative partnerships take aim at industry-specified targets that will help realize national goals for energy and the environment. The Energy Dept.’s State Energy Program (SEP) also provides grants to states and directs funding to state energy offices from technology programs in DOE’s Office of Energy Efficiency and Renewable Energy. SEP allows states to use federal grants to pursue energy priorities. It also funds programs to deploy emerging renewable energy projects and those that advance other energy efficiencies.The DOE’s Office of Industrial Technologies offers Toolbook – A Complete Financing Guide, with updated information on financing available for technologies that optimize energy efficiency and reduce pollution.State offices are good places to seek energy audits and explore methods of funding energy-saving technologies and other measures. State projects may involve several funding sources including DOE and private industry.California strikes goldEnergy shortages in the Golden State have been national news. But efforts to promote energy-saving measures merit equal attention.The California Energy Commission (www.energy.ca.gov) claims roughly one-third the electricity used in California goes to industry, agriculture and water/wastewater treatment. The state actively promotes development of new sources of energy and wise energy usage. Its Energy in Agriculture program assists food processors, food and fiber producers and irrigation districts in adopting energy efficient technologies and practices that reduce energy consumption and adverse environmental impact.

Ever get that restaurant-type feeling that you’re being overcharged when you read your energy bill? What -- you don’t read it at all?

You’re not alone. Utility bills are largely overlooked and almost always assumed to be accurate. Yet estimates of incorrectly calculated energy bills range as high as 75 percent, according to Jim Galbo, principal of Independent Utility Consultants in Amherst, N.Y. These errors cost many manufacturers tens of thousands of dollars or more each year.

A utility bill auditing company can identify and correct errors, can recover overpayment, and even collect interest on the overcharges.

“A utility bill auditing company will conduct a four to six year review of electric, natural gas, propane gas, water, waste water and sewage bills looking for errors,” says Galbo. “These errors may include rate classifications, meter multipliers, meter malfunctions, misread meters, general miscalculations, power factors, erroneous tariff interpretations and transport fee charges, among others.”

Analyzing four to six years of energy charges is a time-consuming process, Galbo emphasizes. For a complete history evaluation and analysis of all utility bills, the auditor may receive up to 50 percent of the recovered amounts in payment.

But food processors rank high among industries in energy usage, and the amounts recovered can be substantial. Furthermore, the processor retains all of the savings from accurate future billings resulting from the audit. Galbo warns against signing agreements with bill auditors who demand ongoing payment for the savings.

Contact Jim Galbo at Independent Utility Consultants: (877) 482-7283.

Food processors are encouraged to refine their processes with energy-efficient technologies and practices, including peak load reduction -- i.e., altering shifts to reduce energy consumption during periods of heaviest usage. The California Energy Commission offers a series of handbooks on energy efficiency, including How to Hire an Energy Auditor to Identify Energy Efficiency Projects; Energy Accounting: A Key Tool in Managing Energy Costs; How to Finance Public Sector Energy Efficiency Projects; and How to Hire an Energy Services Company.Pacific Gas & Electric (www.pge.com), California’s largest energy provider, actively assists its customers in energy management. “We offer integrated audits, auditing operations and making recommendations,” says Phil Pennino, account representative to 30 of the largest accounts served by PG&E. “The recommendations might be introducing adjustable speed drives, microsensors or changing the flow process for high-efficiency chillers. We also encourage our processor customers to take advantage of rebates that help offset some of the capital costs of implementing energy-efficient technologies.” (See sidebar, “Grimmway Farms saves more than $300,000 annually,” below.)PG&E assigns representatives to large processing firms like Kraft, Del Monte, and Nestle USA. The utility offers Standard Performance Contracts (SPC) as an incentive to implement energy-saving systems. It also counsels manufacturers in load management.All of California’s investor-owned utilities participate in the SPC Program.“We try to get companies to take the load off our energy systems during the peak hours of noon to 6 p.m.,” says Pennino. “We like them to understand the benefit of reducing usage as much as they can during these times. Some companies look at our cost/benefit analyses and adjust their production and energy usage where they can to capitalize on the incentives.”Energy savings in the Sunshine StateFlorida’s horrendous 2004 hurricane season put the spotlight on one of the state’s top energy priorities: identifying “interruptible customers,” that is, those customers that can be disconnected during capacity shortages without suffering serious consequences.“Obviously, food processors and cold storage operators need energy nearly all the time,” says Jennings of TECO Energy. Jennings’ industrial customers include the Cargill and Florida’s Natural juice operations, Smithfield Foods and an assortment of seafood processors and cold storage providers. In preparation for the storms, some companies installed backup generators -- a measure encouraged by Florida energy providers to ease load demand during blistering summer days as well as natural disasters. TECO’s Standby Generator Program gives monthly dollar-per-kilowatt credits to companies that install generators large enough to sustain plant operations during emergencies and agree to emergency interruption of normal electrical service. TECO energy audits are funded through a “conservation clause” that calls for a portion of energy billing to be set aside for conservation measures. Audited customers are informed of varying time-of-use rates, which encourage operation during off-peak hours. Companies that do not qualify for TECO programs are often referred to federal Dept. of Energy programs where they may still find financial advantage in energy upgrades. Processors also have incentives to upgrade to more energy-efficient equipment. Programs include rebates for retrofitting to fluorescent lighting and fixtures that are more energy efficient than existing lighting and dollar-per-ton rebates for air-conditioning units with high energy-efficiency ratings. Per-watt rebates applied to other plant equipment can also offset some of the cost of retrofitting. Upgrades without upfront capitalMinnesota customers have upgraded equipment and facilities with no upfront capital and a guaranteed positive cash flow resulting from energy savings. The Shared Savings program offered by Alliant Energy and Interstate Power & Light has reduced energy needs and costs and even reduced labor requirements and improved productivity for some customers capitalizing on the plan. The program makes not just a claim but a guarantee that savings in lower energy bills will pay for capital improvements aimed at more efficient energy usage.Alliant Energy (www.alliantenergy.com), which serves customers in portions of Illinois, Wisconsin, Minnesota and Iowa, has a good reason to assist clients with the financing of energy-efficient capital upgrades. It’s more cost-effective for the utility to save generation than to build new power plants and to upgrade infrastructure. Alliant recognizes that payback on energy-efficiency projects may not be as competitive as other investments, so it has removed the risk portion of the equation by guaranteeing plus-side cash flow based on energy savings. The program begins with a no-cost audit from an Alliant Energy-Interstate Power & Light account manager who analyzes the plant, calculates energy savings and presents an improvement plan. Energy savings and quantifiable non-energy savings (usually resulting from environmental and safety measures) pay for the project. The plan requires zero upfront cost and a five-year repayment in monthly bill installments. Customers can relieve capital constraints by listing the payment as an operating cost. Start saving todayNo-cost and low-cost energy audits are great ways to jumpstart your energy-efficiency efforts and drop dollars – often quickly – to the bottom line. Check with local utility providers on available audits. Utility company audits may vary in their range and degree of sophistication. Some may focus almost entirely on general facilities costs such as lighting, heating and air-conditioning. But others can make useful suggestions about processing equipment and other systems with less obvious potential for energy savings. Check web sites for state and federal programs offering energy counsel, economic incentives and energy audits. And don’t forget universities offering comprehensive energy audits, particularly those involved in the federal Industrial Assessment Centers program listed earlier in this article. Contacts at these offices may be able to direct you to specialists in your own area as well.
Grimmway Farms saves more than $300,000 a year

There’s expense…and then there’s expense.

Capital expense was the primary concern when Grimmway Farms designed the refrigeration system for its Mountain View plant in Bakersfield, Calif. The design called for small pipe to save on the cost of construction.

But that expense seemed penny wise and pound foolish when the company broke down its operational expenses several years later.

Results of Grimmway Farms’
Mountain View upgrade

Annual Facility Consumption: 9,400,800 kWh
Project Cost: $793,000
Annual Electricity Savings: 3,491,085 kWh
Annual Cost Savings: $339,683
Peak Demand Savings: 436 kW
SPC Incentive: $300,000

Data provided by Pacific Gas & Electric
“Drink a soft drink with a cocktail straw, and see how hard it is. Now try using a bigger straw, one of those 3/8 inchers they give you with the jumbo drinks,” suggests Ron Black, general manager of engineering and construction for Grimmway Farms, the largest shipper of carrots in California. “By increasing the pipe size on our refrigeration system, we made it easier to draw the liquid through. And the compressors don’t have to work as hard. That saves energy.”

The success of the Mountain View plant relies heavily on its refrigeration system for hydro-cooling and cold storage. What made the investment doubly enticing was that the capital cost of reworking the refrigeration system into a more energy-efficient operation was also reduced by financial incentives provided by its utilities provider, Pacific Gas & Electric (www.pge.com).

Reworking the refrigeration system involved more than increasing the size of the piping. Insulation had begun to deteriorate, and the system controls were not functioning effectively. So inefficient was the system that it required more than one compressor during light load conditions.

Grimmway’s comprehensive solution eliminated an entire engine room and its two refrigeration compressors from the system. In addition to the piping and insulation upgrades, the carrot processor installed new valves for better control. State-of-the-art digital, programmable temperature and defrost computer controls helped optimize the refrigeration cycle.

The energy savings tallied from the investment were 3,400,000 kWh per year – enough to qualify for PG&E’s Standard Performance Contract (SPC) program and its $300,000 incentive. This offset a large part of the cost of the capital-intensive energy project.

The SPC Program, administered by the state’s investor-owned utilities, provides significant incentive payments to companies that retrofit their commercial and industrial facilities with energy-efficient systems. The incentives are based upon kilowatt-hour and therm savings that are measured and verified by the participating company for two years following implementation of the project.

“In effect it has really been a program of partnership…both locally here with the Kern Division and through the main office in San Francisco,” says Black.


Energy providers will roll out the red carpet for big customers…and the red wagon, too, when needed.

Food processing operations are often some of the biggest users of energy in a given region. Utility providers should be anxious to keep them happy.

Publix, with retail stores and processing facilities for dairy, bakery, deli and produce in the area of Lakeland, Fla., is a favored customer of local utility provider Lakeland Electric.

“The Publix dairy plant is contracted to receive 27 tractor truckloads of raw milk per day,” notes Lakeland Electric key account executive, Ron Pierce. “So it is important to keep them up and running.”

As the utility’s largest customer, Publix negotiates a favorable energy contract rate with Lakeland Electric. But it’s on the service end where the utility steps up its attention.

An advanced transfer system that encircles the Publix processing complex monitors and controls feeds and distributes power as needed. The system design was a joint effort of Publix and Lakeland Electric. The utility has advised and provided engineering assistance to Publix on the energy angle of other projects, too, including a recent freezer installation for ice cream storage.

“Our service emphasizes power quality and reliability,” says Pierce. “The utility is ready to assist at any time.”

That claim was put to the test when a fire disrupted energy distribution to the dairy facility at the Publix processing complex.

“We worked with Publix around the clock after the fire,” says Pierce. “They had a new modified atmosphere banana storage facility under construction. A new feed had been installed, but we hadn’t installed the switch-gear yet. We were able to put it in the dairy.

“Within seven hours they had the new feeds.”

Top 10 Energy Efficiency Recommendations
for Bread and Bakery Products
  1. Use most efficient type of electric motors
  2. Analyze flue gas for proper air-fuel ration
  3. Use energy-efficient belts and other improved mechanisms
  4. Install compressor air intakes in coolest locations
  5. Reduce the pressure of compressed air to the minimum required
  6. Eliminate leaks in inert gas and compressed air lines/valves
  7. Insulate bare equipment
  8. Insulate steam/hot water lines
  9. Install timers and/or thermostats
  10. Install setback timers
Editor's Note:

  • Use demand controller or load shedder
  • Minimize water usage
  • Optimize plant power factor
  • Preheat boiler makeup water with waste process heat
  • Repair faulty insulation in furnaces, boilers, etc.
  • Use outside air for compressor intakes
  • Lease/purchase baler; sell cardboard to recycler
  • Improve lubrication practices
Source: Energy Information Administration survey; via Alliant Energy
Most of these recommendations also were suggested for plants processing fluid milk, sausages and prepared meats, meat packing, poultry processing and flour and grain mill products categories. Additional recommendations from these other food categories include: