Getting Energy Smart

March 1, 2005
More manufacturers are cutting energy costs through strategies ranging from deployment of in-house energy management systems to broader use of alternative fuels.

Montreal-based Abitibi Consolidated Inc. faced a Y2K-like deadline in 2001 when the province of Ontario confirmed plans to deregulate the electric power market in May. The large newsprint and value-added paper company had five plants in Ontario and spent more than $100 million on electricity annually. In order to prepare for the radical fluctuations that were coming in its energy costs, the company created an in-house energy management application.

One of the keys to the company’s response was to create its own energy generation capacity at a number of its plants. The company determined when to use its own energy generation vs. the electricity coming off the grid, depending on the costs. Abitibi installed a system from OSIsoft Inc., of San Leandro, Calif., that monitored costs, weather and other factors that could affect electricity prices. E-mail warnings were sent when costs from the grid made self-generation less expensive.

Price gyrations

In 2002, prior to deregulation, companies were paying $43 per megawatt hour. Once deregulation was unleashed, prices skyrocketed, moving to $75 during the winter of 2003 due to cold weather conditions. And prices sometimes swung wildly, at one point, hitting $800 for one megawatt hour.

Using its energy management system, Abitibi was able to shut down its consumption of grid electricity and use its own. During some periods of sky-high costs, Abitibi actually shut down one of its plants to sell its self-generated energy to the gird, taking advantage of the high market prices. “Another scenario might be that you run a mill on its own generation during the day when prices are high, then purchase power at night when it’s cheaper,” says Guy Roussel, senior analyst, IT planning at Abitibi.

Welcome to the complexities of managing power at a manufacturing plant. Costs of traditional energy started to skyrocket a couple of years ago. To mitigate the energy rollercoaster, companies have turned to their automation systems and to alternative energy sources. Many plants now use alternative fuels to run their plants, and when market prices go out of sight, they will even shut down production and sell their energy to the local power grid.

An energy management system monitors conditions and sends signals when it is optimal to change the energy source. “In the paper industry, they use different sources to make steam,” says Gregg Le Blanc, product director and strategist at OSIsoft. “If they monitor that closely with the software, they can rectify the problem of high energy costs by switching to alternative energy sources.”

Le Blanc notes that the energy management system is always just a tool to help to make decisions on what’s optimal. Ultimately, it just alerts a human being that a decision needs to be made. “An energy management system doesn’t replace human involvement in the decision-making process,” says Abitibi’s Roussel. “It simply provides the information to facilitate real-time business decisions.”

Alternative fuels

In addition to using alternative sources of energy to run plants more cost-efficiently, companies are also using different kinds of fuel to create energy. A wide range of alternative fuels is now available to run plants. “Alternative fuels include biomass, which is wood chips, recycled paper, manufacturing byproducts, even garbage,” explains Mark Converti, senior segment manager for power generation capabilities, at Honeywell Inc., of Morris Township, N.J. “Alternative fuels also include methane, blast furnace gas and other off-gas products. It’s all waste fuel that is in some way combustible.”

Yet each of these different kinds of fuels comes with its own challenges. For one, the air mixture varies. The temperatures generated by burning different fuels vary, and finally, the emissions produced by each fuel are different. Honeywell helped a power plant retrofit its boilers to accommodate a variety of fuels and adjust its environmental impact. Honeywell’s system works to optimize the combustion within the boiler, which helps to mitigate the inconsistencies in alternative fuels such as biomass.

According to Converti, when you burn alternative fuels, a new set of concerns must be addressed. “We work with a crude oil company in Alberta whose boilers are fueled with all types of things that are heavy in methane,” says Converti. “When you’re switching out alternative fuels, you have to worry about BTU (British Thermal Unit) content.” He notes that boilers can be designed to deal with inconsistent fuels such as garbage. “Boilers can burn it, but you have to optimize the fuel/air ratio, and as well as optimizing on the inlet, you have to optimize on the outlet to control the varying emissions.” He notes that control systems can now optimize these variants, which makes alternative fuels more plausible than in the past.

Another responsibility that is being taken on by control systems is helping to maintain a secure energy flow at the plant. The ability to secure the energy flow can differ depending on the needs of the plant. In the case of Abitibi, sometimes a secure flow of energy for plant operations isn’t as important as being able to get a high market price for self-generated electricity. In other cases, plant shutdowns are highly expensive and need to be avoided at almost all costs.

What’s it mean?

“When people start to talk about [energy] security, it can mean any number of things,” says Joe Weiss, executive consultant with KEMA, a Dutch engineering consulting company with U.S. offices in Burlington, Mass. “In the traditional definition, it’s making sure electricity flows back and forth. But with technology, security can mean cyber security, keeping the energy network safe.”

For some companies, security is a matter of being able to monitor remote sites from a central location. “As for security, we can monitor a site without being on site,” says OSIsoft’s Le Blanc. “If the system detects something subnormal, you can see it without having a physical presence at the plant.” The monitoring is helpful when energy prices surge and a decision has to be made about whether to change power sources or shut down a plant. “If you can see prices rising on a grid that a plant draws electric power from, you can start to divert power from other sources.”

Those other sources available to plants are growing, as high energy prices bring new players and new fuels into the market. Control systems can now monitor the energy landscape and offer alternatives to traditional sources. “Ten or 20 years ago, you bought energy from a single source. You would use two or three sources at the most. You were basically locked in on price,” says Eric Petela, director of energy optimization at software vendor Aspen Technology Inc., of Cambridge, Mass. “Now, instead of having a regular supplier, you have 20 or 30 suppliers, and they’re competing by changing the contract details.”

Energy concerns will continue to be a major part of automation systems. The systems are being tailored to accommodate a very fluid energy market. Complexities include everything from tracking the daily—even hourly—changes in energy pricing to tracking the variety of alternative energy sources that are available. Securing a consistent flow of energy is important, but even that can now be altered by systems that can alert operators when conditions arise that make the sale of site-produced energy back to the local power grid more financially attractive than running the plant.

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