Robin Kent thinks a lot of plastics processors are leaving money on the table — in some cases, millions of dollars — in the mistaken assumption that energy is a fixed cost over which they have little control. In fact, the Australian-born consultant contends that about 30 percent of a processor's energy costs are variable and discretionary, and that learning how to manage them more efficiently can provide a significant competitive advantage.
Such savings tend to drop directly to the bottom line. ``Depending on the profit margin of the site,'' he explained, ``the savings can be expressed in terms of sales value equivalents. If the profit margin is 5 percent, then every $1 saved through energy management is the equivalent of $20 in additional sales.'' Better yet, competitors can't stop you from making such gains.
That said, competitors in some unlikely places are ahead of many U.S. companies when it comes to exploiting this advantage. The most energy-efficient plastics plant he's ever been in, for example, is in Malaysia.
Kent, a materials engineer with a doctorate in solid-state polymer physics, is founder and managing director of Hitchin, England-based consulting firm Tangram Technology Ltd. The 36-year plastics industry veteran formed Tangram in 1996 to address the needs of plastics processors, window systems suppliers, window fabricators, specifiers and consumers in the United Kingdom. Over the years he has become an expert on energy management for all types of plastics processes, and consults for clients all over the world.
During a four-hour workshop in Chicago that kicked off the recent Sustain '08 plastics business summit, Kent briefed attendees on some of his key findings. He said that all too often measuring energy is seen as a difficult, expensive exercise that has little or no bearing on practical production. Managers tend to consider it an uncontrollable overhead and hence a low priority.
In fact, energy efficiency should be a key contributor to good productivity. It can cost very little to start managing energy, and companies can realize worthwhile savings almost immediately. However, if it cannot be measured, it cannot be controlled, so it is vital to start by grasping your company's energy usage needs and patterns.
Labor costs represent, on average, only about 10 percent of a plastic product's cost, and overheads account for about 35 percent (with materials accounting for the balance). Yet, Kent said that three-quarters of most companies' cost-containment efforts go toward reducing labor costs, and only 15 percent toward reducing overhead expenses.
He is not opposed to such popular actions as changing to more energy-efficient light bulbs, but said, ``In most plastics plants, the lighting load equals only 5-6 percent of a company's overall energy cost. That's not a lot.''
The main electrical energy users are motors and drivers, heaters and cooling systems, along with lighting systems. Start by counting the motors, heaters and lights and drawing up an energy-map spreadsheet of your site to locate areas for monitoring and improvement. Few companies actually check their electricity meters each month against the bills from their energy provider; rather, they just blindly pay the bill, even when these bills might amount to a couple million dollars a year.
So, Kent advised, learn to read your energy bill, and to analyze your usage trends. Be sure to calibrate the maximum number of kilowatts per hour load to match your needs. For example, a warehouse might require 20 percent of the load needed by a processing plant — yet he's seen plenty of companies paying many times more than necessary to operate their warehouses.
He urged every firm to plot the number of pounds of material processed in a month vs. the kwh per month, using a scatter chart. The base load (the amount used for heating, lighting, compressors and pumps when you have no production at all) is a fixed overhead; the process load, by comparison, is variable.
Product mix can have a big bearing on energy usage for plastics processors. Extrusion, for example, always uses less energy than injection molding. Managers should factor such data into their product pricing, Kent suggested, or at least into their assessment of a product's profit margin.
Motor management is extremely important. About two-thirds of energy used in plastics processing is in motors, and the cost of motors is in the operation, not the purchase. About 40 days of continuous running usually equals the cost of a motor.
``Map your motors,'' advised Kent. And ``do not rewind your motors, ever! Rewinding motors builds in energy inefficiency,'' at the cost of about 1 percent per rewind. When using a variable-frequency drive, slowing down the motor speed by just 20 percent halves the energy usage.
Also a $1,500 ultrasonic tester can help you find compressed-air leaks in your plant. Such devices, equipped with a set of headphones, can be used effectively in loud factory environments.
``Buy one — no discussion,'' says Kent. Walk around your plant and listen for a hissing sound. ``Every leak costs you at least $150 a year.'' Get rid of your compressed-air screwdrivers, and replace them with direct-drive electric screwdrivers.
``Everywhere you have a compressed-air line, you have a significant opportunity for re-engineering, and cost savings.''
And, unless you are an injection molder that needs really fast cycle times of, say 4.5 seconds or less, ``don't even consider buying a hydraulic injection press under 600 tons,'' according to Kent. Hybrid presses may also provide a viable option, but general-purpose, low-tonnage hydraulic presses simply waste money, he claims.
Only 5-10 percent of the total energy used in injection molding, he noted, is actually put into the polymer; the other 90-95 percent is used to operate the machine. And presses use between 52 and 97.5 percent of their running energy when they are idling.
Other significant factors to consider include polymer drying, water cooling and lighting.
Kent noted there are specific differences between processes — be it thermoforming, injection or extrusion blow molding, rotomolding, or even expanded polystyrene foam molding.
The fundamental disconnect, he said, is this: ``Nobody needs approval to spend money on energy. But everybody needs approval to spend money on saving energy.''