 "Em'power'ing efficiency in chemical industry: Dr Naushad Forbes, Director, Forbes Marshall")
One can control a few things. Raw material costs are a given by international commodity prices and not by individual companies. Companies can only control processing costs, of these, fuel costs tend to be the most significant. The rise in fuel costs has hit all industries, significantly especially chemical industry, where fuel costs are a high percentage – about 1/3 or more of conversion costs.
We have seen a positive change in the approach towards energy efficiency. Ten years ago, energy conservation was something good to do. As prices - for materials and finished products - are increasingly dictated by global markets, what remains within our control is conversion cost, and energy costs are perhaps our greatest opportunity for cost reduction in the country today.
Optimising energy resources
The high cost of energy is a great prompt for focussing on energy efficiency. Twenty five years ago, energy conservation was good to do because it was ‘good to do’. Today energy conservation is a must to survive – a much more compelling driver. Looking at the energy conservation paragraph in any chemical company’s annual report, one can see consistent progress year on year on reducing energy consumption. The average saving for the industry as a whole is a 5% improvement in energy consumption year on year for the last twenty years – a very substantial saving.
It is essential to take a holistic view of plant economics. One should aim for the right steam system the first time. Sometimes one is tempted to go in for short term efficiency measures or look for less expensive solutions and look at doing something later, this proves to be expensive in the long term. One should have an energy conservation target and track it monthly. One should put in place the right diagnostics to help you know how you are doing on a daily basis instead of using thumb of the rule or guesswork.
In tough economic conditions
The starting point of right energy management strategy is to know here one is. Sometimes one thinks that because one has installed the best equipment, one has the best efficiency, but how one operates that equipment is what determines the result. Our studies have shown that average boiler efficiency is 70% for an oil fired boiler against an optimal efficiency of 85% and is 60% for solid fuel boilers against an optimal efficiency of 80%.
The process industry is so broad based, that it is difficult to apply a single formula but it should continue to do well by investing in process efficiency enhancement, whether its steam as a utility or automation and control of processes. While the potential for energy conservation has always been huge, the change in the demand for conservation to survive is creating the momentum for energy conservation that we are seeing today.
Role of top management
We have found that companies with the most effective energy conservation programme have a very powerful combination of committed top management, imaginative utility manager and engineer and resourceful technicians. So while committed top management is essential, it is not enough in itself. One needs the right flow of energy saving proposals from imaginative utility managers for top management to approve and one needs skilled technicians to ensure that whatever equipment is installed, performs effectively.
The author is the Director of Forbes Marshall, Pune
We have seen a positive change in the approach towards energy efficiency. Ten years ago, energy conservation was something good to do. As prices - for materials and finished products - are increasingly dictated by global markets, what remains within our control is conversion cost, and energy costs are perhaps our greatest opportunity for cost reduction in the country today.
Optimising energy resources
The high cost of energy is a great prompt for focussing on energy efficiency. Twenty five years ago, energy conservation was good to do because it was ‘good to do’. Today energy conservation is a must to survive – a much more compelling driver. Looking at the energy conservation paragraph in any chemical company’s annual report, one can see consistent progress year on year on reducing energy consumption. The average saving for the industry as a whole is a 5% improvement in energy consumption year on year for the last twenty years – a very substantial saving.
It is essential to take a holistic view of plant economics. One should aim for the right steam system the first time. Sometimes one is tempted to go in for short term efficiency measures or look for less expensive solutions and look at doing something later, this proves to be expensive in the long term. One should have an energy conservation target and track it monthly. One should put in place the right diagnostics to help you know how you are doing on a daily basis instead of using thumb of the rule or guesswork.
In tough economic conditions
The starting point of right energy management strategy is to know here one is. Sometimes one thinks that because one has installed the best equipment, one has the best efficiency, but how one operates that equipment is what determines the result. Our studies have shown that average boiler efficiency is 70% for an oil fired boiler against an optimal efficiency of 85% and is 60% for solid fuel boilers against an optimal efficiency of 80%.
The process industry is so broad based, that it is difficult to apply a single formula but it should continue to do well by investing in process efficiency enhancement, whether its steam as a utility or automation and control of processes. While the potential for energy conservation has always been huge, the change in the demand for conservation to survive is creating the momentum for energy conservation that we are seeing today.
Role of top management
We have found that companies with the most effective energy conservation programme have a very powerful combination of committed top management, imaginative utility manager and engineer and resourceful technicians. So while committed top management is essential, it is not enough in itself. One needs the right flow of energy saving proposals from imaginative utility managers for top management to approve and one needs skilled technicians to ensure that whatever equipment is installed, performs effectively.
The author is the Director of Forbes Marshall, Pune