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Industrial Energy Efficiency 101: The Basics of How Industry Uses and Conserves Energy

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Resource Type:
Report
Author(s): 
Robert Bruce Lung
Dow Chemical Company - St. Charles, La.

Above photo: The Dow Chemical Company’s operations in St. Charles, La.

Compared with the residential, commercial and transportation sectors, the industrial sector is the largest energy-consuming  sector of the U.S. economy. 

That’s no surprise: We rely on industry to process our raw materials and make all the products we use every day. Each year, the country’s 196,000  factories, refineries, steel mills and other industrial plants  use over 30 Quadrillion Btu of energy — that’s nearly one-third of the energy used to power the whole nation.

Components of Industry

So what is industry, exactly?

Manufacturing accounts for 85% of industrial energy use. That includes:

  •  Processing food and materials like petroleum, iron ore, bauxite,  wood, and other minerals
  • Refining oil and gas
  • Heat treating metal
  • Assembling cars (see photo, right)...

car manufacturing

  • …And numerous other processes

Industrial energy use also includes non-manufacturing activities, like:

  • Agriculture
  • Construction
  • Mining
  • Water and wastewater treatment

Energy Sources & Energy Uses

The types of fuels used within each industry – and even each plant – vary greatly due to production practices, weather, changes in the mix of production materials, and a slew of other factors.

Industry uses energy – usually in the form of electricity and fossil fuels, but also from renewables – for three main categories of energy uses: processes, crosscutting support equipment, and the facilities themselves. 

Process-related applications account for 80% of industrial energy use, and they  usually require fossil fuels like natural gas, petroleum and coal. This includes:

  • Process heating, which involves furnaces and ovens that smelt and cure raw materials
  • Chemical reactions, distillation and other processes needed to produce chemical compounds, plastic, steel, and other products

Crosscutting equipment and supportive systems account for 15% of industrial energy use, usually powered by electricity. This includes:

industrial pumps

  • Motor-driven equipment, like pumps (see photo, right), as well as air compressors, fans, mixers, combined heat and power generation, etc.)
  • Equipment handling applications that move everything from raw materials to finished products

Facilities themselves account for 5% of industrial energy use, usually from electricity. This includes building systems like:

  • Heating, ventilating and air conditioning
  • Lighting
  • Appliances

Common Energy Efficiency Practices

Industrial facilities and manufacturing plants engage in a variety of practices to save energy.

  • Energy assessments: The first – and, in the long run, most effective – step is getting an independent assessment to determine where the energy efficiency opportunities exist in a plant.
  • Energy management: In many cases, energy efficiency can be improved through changes in how energy is managed, instead of replacing equipment.
  • Energy standards: The International Organization for Standardization (ISO) offers a voluntary standard that provides a framework for managing and improving energy performance. Industrial plants – as well as corporations and other organizations – can implement the standard, which is called ISO 50001.
  • Energy-efficient processes and technologies: A variety of best practices and equipment can help industrial plants save energy. Examples include  combined heat and power (CHP) systems, which produce  electricity from recovered heat that is given off in various processes, variable speed drives, and advanced sensors and controls.

Photo above/right: 40MW CHP installation at ArcelorMittal Indiana Harbor in East Chicago, Ind., including a blast furnace gas recovery boiler and a condensing steam turbine.

Programs Supporting Industry

Many federal, state and utility programs help manufacturers improve energy efficiency. Federal programs include:

In addition, the Department of Energy (DOE)’s Industrial Assessment Centers and the U.S. Department of Commerce’s National Institute of Standards and Technology’s Manufacturing Extension Partnerships program offers energy efficiency solutions for small to medium industrial firms.

Lastly, the U.S. Department of Commerce’s National Institute of Standards and Technology’s Advanced Manufacturing Partnership performs research into new ways to manufacture existing products using emerging and new advanced technologies

Policies Supporting Industrial Energy Efficiency

Two proposed pieces of legislation have strong potential to bolster energy efficiency for industry.

  • The Energy Savings and Industrial Competitiveness Act of 2011 (ESICA), sponsored by Sen. Jeanne Shaheen (D-N.H.) and Sen. Rob Portman (R-Ohio), would make U.S. industry more energy efficient by:
  • Improving and increasing coordination of state, federal and non-governmental organizations and programs
  • Establishing a revolving loan program to help finance efficiency upgrades
  • Establishing a DOE program to help make companies’ supply chains more efficient.
  • Requiring DOE to make an inventory of cost-effective but under-used technologies for energy-intensive industries

In the House of Representatives, Reps. Charles Bass (R-N.H.) and Jim Matheson (D-Utah), introduced The Smart Energy Act. This bill would:

  • Provide incentives for implementing CHP
  • Require DOE to develop a strategic plan to achieve a two-fold increase in electricity generated from CHP
  • Direct DOE to establish research and development partnerships to promote energy efficiency technology development and commercialization, reduce industrial waste, and increase cost-competitiveness.

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