Real Prospects for Energy Efficiency in the United States (2010) / Chapter Skim
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4 Energy Efficiency in industry
4 Energy Efficiency in industry
Pages 185-260
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From page 185... ...
It focuses on the potential for improving energy efficiency cost-effectively in four major energy-consuming industries -- chemical manufacturing and petroleum refining, pulp and paper, iron and steel, and cement -- and discusses the role of several crosscutting technologies as examples. In addition, this chapter identifies major barriers to the deployment of energy-efficient technologies, outlines the business case for taking action to improve the energy efficiency of U.S.
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From page 186... ...
According to the International Energy Outlook 00, the industrial sector worldwide used 51 percent of the total delivered energy (or 50 percent of the primary energy) in the year 2006, and its demand was pro jected to grow by an annual rate of 1.4 percent between 2006 and 2030 (EIA, 2009a)
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As shown in Figure 4.1, these industries are responsible for more than 70 percent of industrial energy consumption. Industries that are less energy-intensive include the manufacture or assembly of automobiles, appliances, electronics, textiles, and other products.
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Industrial Energy Use (Excluding Nonfuel Uses of Coal, Oil, and Natural Gas) , in Selected Years from 1978 to 2004 (in quadrillion Btu)
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have caused a decline in energy intensity and in total industrial energy use. By comparing the energy intensity of manufacturing across 13 countries that are members of the International Energy Agency (IEA)
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industrial sector gross domestic product (GDP) , energy use, structure, and energy intensity, 1985–2003.
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industrial energy consumption substantially to reflect the nation's economic slowdown, rising energy prices, and the passage of the Energy Independence and Security Act of 2007 (P.L.
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, a portfolio of advanced policies3 was estimated to reduce energy consumption in the industrial sector by 16.6 percent relative to a business-as-usual (BAU) forecast, at no net cost to the economy (IWG, 2000; see also Brown et al., 2001, and Worrell and Price, 2001)
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The CEF study, Scenarios for a Clean Energy Future (IWG, 2000) , does not use a single hurdle rate.
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fore casts a BAU industrial-sector consumption of only 34.3 quads of energy in 2020. Scaling the 16.6 percent savings estimate to this lower level of future baseline industrial energy consumption suggests a savings of 5.7 quads, or a possible pol icy-induced reduction in industrial energy use to 28.4 quads.4 These sector-wide 4When the panel applies older estimates of percentage improvement to newer (and lower)
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From page 195... ...
. Scaling this estimate to reflect the downward forecast of future industrial energy consumption suggests an economic savings potential of 2 quads.5 In combination with the sector's other energy efficiency opportunities identified in the CEF study, this brings the total estimate of economic energy-savings potential to 7.7 quads, or 22.4 percent of the Annual Energy Outlook 008 (EIA, 2008)
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3) as "the leading cross-segment opportunity." This estimate for CHP is considerably less than the 2.0 quad estimate from Scenarios for a Clean Energy Future (IWG, 2000)
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energy consumption. However, only 5 of the 19 technologies identified are related to CHP technologies (i.e., advanced cogeneration, steam-injected gas turbine, gas turbine process heater, gas turbine drying, and fuel cells)
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from a baseline forecast of 6.08 quads. b6.1 percent of the 2.31 quads of energy consumption forecast for the paper industry in 2020 by the Annual Energy Outlook 008 (EIA, 2008)
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cIncludes CHP systems, which contribute an estimated savings in 2020 of 0.7–6.8 quads. Tracking Industrial Energy Efficiency and CO Emissions (IEA, 2007)
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For natural gas, 468 million therms of natu ral gas are forecast to be the magnitude of economic efficiency opportunity in the industrial sector, representing 13 percent of the base use of 3590 million therms in 2016. Figure 4.4 presents the two supply curves, which identify the least-expensive efficiency measures.
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Energy Efficiency in Industry 0 0.50 0.45 per Kilowatt-hour Saved 0.40 Levelized Dollars 0.35 0.30 0.25 0.20 0.15 0.10 0.05 0.00 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% Savings Potential as a Percentage of Base Electricity Use 1.20 Levelized Dollars per Therm Saved 1.00 0.80 0.60 0.40 0.20 0.00 0% 2% 4% 6% 8% 10% 12% 14% Savings Potential as a Percentage of Base Natural Gas Use FIGURE 4.4 Energy efficiency supply curves for California through 2016. The width of each portion of the curves is proportional to the amount of energy that can be saved.
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, a wide array of advanced industrial technologies could make significant contributions to reducing industrial energy consumption and CO2 emissions. Possible revolutionary changes include novel heat and power sources and systems and innovative concepts for new products and processes that take advantage of developments in nanotechnology and micro manufacturing.
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4.3 OPPORTUNITIES FOR ENERGY EFFICIENCY IMPROVEMENTS IN FOUR MAJOR ENERGY-CONSUMING INDUSTRIES In the chemical and petroleum refining, pulp and paper, iron and steel, and cement industries, numerous opportunities exist for energy efficiency improvements. These opportunities are characterized below in three timeframes: 5–10 years, 10–25 years, and beyond 25 years.
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Raw materials include hydrocarbons from petroleum refining, mined chemicals and minerals, and even such animal and plant prod ucts as fats, seed oils, sugars, and timber. For energy sources the industry uses petroleum-based feedstocks, natural gas, coal, and electricity -- and, to a lesser but growing extent, biomass.11 Products include thousands of bulk and fine organic and inorganic chemicals, polymers, agricultural chemicals, and fertilizers.
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energy consumption for these industries from 1985 through 2002 (EIA, 2002)
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The absolute energy consumption of petroleum refineries in the United States must be adjusted to account for increasingly heavy crude slates over the coming years. When one adjusts for the use of heavier crude slates, the energy consumption of a refinery increases per equivalent amount of refined product.
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In summary, the chemical and petroleum-refining industries have many similarities in raw materials, energy sources, process equipment and control, and the opportunity to achieve significant energy efficiency improvements. They differ in key ways centered around the breadth of product lines and the areas in which innovation will gain them a competitive advantage.
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This allocation process, as with all the other allocations, is largely decided on the basis of business need. At any given time, more product may be more important than lower energy consumption.
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The highest estimate is a range of 1.40 to 3.28 quads in 2020 (23 to 54 percent of projected energy consumption in this industry) published in a DOE (2006b)
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TABLE 4.7 First Use of Energy for All Purposes in the Pulp and Paper Industry (Fuel and Nonfuel) , in Primary Energy, 2002 (trillion Btu)
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. The Pulp and Paper Industry Energy Bandwidth Study concluded that applying current design practices for the most modern mills can reduce the energy consumption of the pulp and paper industry by 25.9 percent and that the implementation of advanced technologies could reduce mill energy consumption by even more (41 percent)
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study for the DOE Industrial Technology Program indicates that the pulp and paper industry can reduce energy consumption by 25 percent (0.6 quad) by 2020 by accelerating the adoption of proven technologies and process improvements.
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steel industry in world markets has been eroding over the past three decades with manufacturing moving offshore, particularly to Asia. Table 4.8 indicates that between 1997 and 2006, imports of iron and steel products increased from 41 million tons per year to 65 million tons per year.
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Percent Change Imports Steel mill products Ingots, blooms, billets, slabs, etc. 6,358 9,317 46.5 Wire rods 2,237 3,046 36.2 Structural shapes and pilings 1,141 1,146 0.5 Plates 2,939 3,416 16.2 Rails and accessories 238 352 47.9 Bars and tool steel 2,627 5,111 94.5 Pipe and tubing 3,030 7,545 149.0 Wire drawn 655 903 38.0 Tin mill products 638 749 17.4 Sheets and strips 11,294 13,686 21.2 Total steel mill products 31,157 45,273 45.3 Other steel products 3,233 6,941 114.7 Total steel products 34,389 52,214 51.8 Iron products and ferroalloys 6,659 13,110 96.9 Grand Total, Imports 41,048 65,324 59.1 Exports Steel mill products Ingots, blooms, billets, slabs, etc.
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One means of improving the efficiency of blast furnace ironmaking has been by recovering blast TABLE 4.9 International ComparisonEnergy Intensity of the Iron and Steel Industry of Selected Countries Energy Intensity, Energy Intensity, Percent Difference Percent Difference 1995 2005 Compared with the Compared with the (Btu/tonne) (Btu/tonne)
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iron and steel industry must become more resource efficient and less capital intensive. Figure 4.5 shows the energy con 60 50 Million Btu per Ton 40 30 20 10 0 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2001 2002 2003 2004 2005 2006 Year FIGURE 4.5 Energy consumption in the U.S.
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Box 4.5 indicates that the iron and steel industry can reduce energy consumption by 0.3 quad (22 percent) by 2020 by accelerating the adoption of proven technologies and process improvements.
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This would require a focus on new technologies instead of incremental process improvements.14 4.3.4 Cement Industry The cement industry is among the largest industrial energy consumers in the United States and the world, accounting for 5 percent of the energy used in the U.S. manufacturing sector, or 1.3 quads (EIA, 2002, Table 2a)
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cement industry improved steadily during the 1970s and 1980s as wet kilns were replaced by more modern facilities (Figure 4.7)
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Wet kilns <0.5 million tons/yr capacity 6.2 Wet kilns ≥0.5 million tons/yr capacity 5.6 Dry kilns <0.5 million tons/yr capacity 4.9 Dry kilns ≥0.5 million tons/yr capacity 4.1 Long dry kilns 5.1 Dry preheater kilns 4.1 Dry preheater-precalciner kilns 3.8 Source: van Oss, 2005. Chemicals 7.8 Transportation Aluminum 0.9 28% Petroleum Refining 7.3 Industry 33% Fabricated Metals 0.7 Forest Products 3.3
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that yield only modest energy efficiency improvements for the dry kiln process, controls (savings up to 3 percent in the electricity used) , and possibly blending and roller mills (payback periods not provided; total savings of up to 10 percent)
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9 Specific Energy Consumption (Million Btu per Ton) 8 7 6 5 4 Wet 3 Dry Either 2 Clinker (Average)
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A Cement Industry Energy Intensities by Region and Subregion Region Energy Intensities Subregion Energy Intensities MJ per kg Clinker MJ per kg Clinker Region Name 1990 2000 Subregion Name 1990 2000 I
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(2004) identify potential energy savings of up to 20 percent from the deployment of blended cement technologies.
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. It should be noted that carbon capture and storage technology requires substantial energy itself, so that its deployment would confer a significant energy efficiency penalty in the production of cement.
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(2004) , is 0.29 quad, or 67 percent of projected energy consumption in 2020.16 The CEF study (IWG, 2000)
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The following seven subsections summarize these crosscutting technologies. 4.4.1 Combined Heat and Power Combined heat and power units transform a fuel (generally natural gas)
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Despite the efficiency gains that it offers, CHP has been limited in its devel opment owing to a variety of regulatory, structural, and economic factors, includ ing local restrictions on air emissions; backup energy fees (i.e., for standby power) charged by utilities; costs associated with site-specific engineering and design; dif ficulty in obtaining a suitable natural gas supply contract; restrictions on selling electrical power to the grid; and the challenges of obtaining permits and meeting safety regulations.
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A third, intermediate estimate based on the CEF study (IWG, 2000) is that CHP could cost-effectively expand the energy savings by 2.0 quads (Lemar, 2001)
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The energy used for separations totals about 4.5 quads per year, or 47 percent of all the energy used in manufacturing. Both distillation and membrane separation are described below to illustrate current and potential innovations that might reduce the energy intensity and total energy use of U.S.
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According to that report, membrane separation is the most widely applicable of all technologies for reducing the energy of separation processes in the petroleum, chemical, and forest products industries (Nenoff et al., 2006; Banerjee et al., 2008)
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The energy savings in the chemical industries alone has been estimated at about 95 trillion Btu/year by 2025, a reduction of about 2.5 percent in the total energy consumption by those industries (Worrell et al., 2004)
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In its fiscal year (FY) 2009 budget submission, the DOE estimates potential energy savings from these programs in the year 2020 of 103 trillion Btu and carbon savings of 1.5 million metric tons of carbon equivalent.
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that Uses an optimized combination of radiant and convection heating for processing materials, Decreases energy consumption by a factor of three, Reduces heating times by an order of magnitude, and Produces high-performance forgings with improved tensile and fatigue properties. Field testing of the system in a full-scale production setup demonstrated a cost savings of 40−50 percent owing to reduced energy consumption, increased throughput, and improved consistency in the process and product:
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Energy Efficiency in Industry 4.9 Efficiency FIGURE 4.8 Continuous-belt infrared furnace for high-performance aluminum forgings. Testing of this system at Queen City Forging Company confirmed that it is more than three times more energy-efficient than current convection furnaces in preheating aluminum billets.
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New fabrication processes are those crosscutting processes that support sev eral energy-intensive industrial processes. The approach is to develop technolo gies that will improve yields per unit of energy cost for multiple elements of the manufacturing supply chain and will reduce waste and/or improve energy effi ciency while demonstrating air- and water-neutral production methods.
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paper industry approximately $200 million annually in energy costs.18 New kinds of sensors employ a variety of technologies that in the past were usually associated with individual measurements rather than with monitoring. For example, an X-ray diffraction sensor developed under the ITP allows online monitoring of the composition, specifically the phase, of steel as it is being manufactured.
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This is based on replacing a diffusion junction with a very precise, very small capillary, to allow small amounts of fluid to flow without serious restriction. A detector has been developed to predict the flooding of distillation columns.
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Save Energy Now was created to help reduce energy consumption at industrial process sites in the wake of Hurricane Katrina. It initially focused on steam and process heat in a select group of 200 of the nation's largest manufacturing facilities (there are about 6800 manufacturing facilities that use more than 1 trillion Btu annually)
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ITP has developed a suite of B software-based decision tools to help industrial plant personnel identify energy efficiency improvements for plant process and utility systems. These are available free of charge and can be downloaded from the DOE's Web site.
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Shown are the estimated savings in industrial energy costs identified by the DOE's Save Energy Now 4.10 Efficiency assessments in 2006. Most of the savings had estimated payback periods of less than 2 years.
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Shown 4.11 Efficiency are the estimated savings in industrial energy costs identified by the DOE's Save Energy Now assessments in 2006. Most of the savings had estimated payback periods of less than 2 years.
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. R&D opportunities suggest the possibility of further energy efficiency improvements to industrial steam and process heating.
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, it is estimated that industrial motor energy use could be reduced by 11–18 percent if facility managers undertook all cost-effective applications of mature, proven efficiency technologies and practices. Specifically, the implementation of all well-established motor system energy efficiency measures and practices that meet reasonable investment criteria could yield annual energy savings of 75–122 bil lion kWh.
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Cost and per formance improvements are still needed, including reductions in the cost of cool superconducting materials. 4.5 BARRIERS TO DEPLOYMENT AND USE The broader application of industrial technologies that are available for deploy ment is impeded by barriers such as the relative high risk and costs associated with new industrial technology, a lack of specialized knowledge relating to energy efficient improvements, and an inadequate flow of information.
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Since energy costs are typically small relative to the costs of materials, labor, and plant and equipment, they usually are not the factor driving new investments. Relatively high initial costs for industrial energy efficiency improvements can be an impediment to investments.
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. Business managers in commercial and industrial sectors are facing knowledge barriers, but commercial managers are more likely to adopt new technologies because the main efficiency improvements are related to common technologies, such as lighting and air-conditioning.
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Investments in industrial energy efficiency technologies are hindered by mar ket risks caused by uncertainty about future electricity and natural gas prices and unpredictable long-term product demand. The high cost of capital and constrained credit markets are also significant barriers to energy efficiency improvements in industry.
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A modification of depreciation schedules would remove a significant barrier to industrial efficiency investments, but it would require legislative action (Brooks et al., 2006)
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To remain competitive, industry must find ways to reduce its energy consumption, and higher energy costs can make efficiency invest ments more cost-competitive. Of course, the cost of efficiency invest ments can also rise with energy costs (perhaps lagged by a few years)
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Secondary or collateral benefits such as increased productivity, improved product quality, reduced labor costs, and enhanced reliability are often strong drivers for energy efficiency improvements (Worrell et al., 2003)
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I.3 Industry has experienced a significant shift to offshore manufacturing of components and products. If the net energy embodied in imports and exports is taken into account, the energy consumption attributable to industry would be increased by 5 quads.
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2005. Clean Energy Technologies: A Preliminary Inventory of the Potential for Electricity Generation.
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2001. Scenarios for a clean energy future.
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2008. Energy Intensity Indicators in the U.S., Highlights of Trends, Industrial Total Energy Consumption.
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2002. 2002 Manufacturing Energy Consumption Survey.
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2007. Energy myth nineEnergy efficiency improvements have already reached their potential.
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Industrial Sector. Report prepared for DOE, Office of Energy Efficiency and Renewable Energy.
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2006. World's Best Practice Energy Intensity Values for Selected Industrial Sectors.
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DOE 2006 Save Energy Now Assessment initiative: DOE's Partnership with U.S. Industry to Reduce Energy Consumption, Energy Costs, and Carbon Dioxide Emissions.
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