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WASHINGTON – Today, the Energy Department released the On the Path to SunShot reports, a series of eight research papers examining the state of the U.S. solar energy industry and the progress made to date toward the SunShot Initiative’s goal to make solar energy cost-competitive with other forms of electricity by 2020. The solar industry is currently about 70 percent of the way towards achieving the Initiative’s 2020 goals, but as solar has become more affordable, helping the industry grow by an astonishing 23-fold since the beginning of the Obama Administration, new challenges and opportunities have emerged.

The reports released today explore the lessons learned in the first five years of the ten-year Initiative and identify key research, development, and market opportunities that can help to ensure that solar energy technologies are widely affordable and available to power millions more American homes and businesses.

“Solar energy is an integral part of our nation’s ongoing energy revolution,” said U.S. Secretary of Energy, Dr. Ernest Moniz. “The U.S. has over 10 times more solar installed today compared to 2011 when the SunShot Initiative was first launched, and the overall costs of solar have dropped by 65 percent.  The Administration’s continued efforts through the SunShot Initiative will help to further reduce costs to make solar energy more accessible and affordable for American families and businesses.”

Launched in 2011, the SunShot Initiative was created with the goal to reduce the cost of solar energy technologies by 75 percent within a decade across the residential, commercial, and utility-scale sectors. Since then, solar technologies, solar markets, and the solar industry have changed dramatically. The On the Path to SunShot series serves as a follow-up to the 2012 SunShot Vision Study, which analyzed the economic and environmental benefits that would result from achieving SunShot’s ambitious 2020 goal. This new study series explores the areas of focus that could help the United States to achieve cost-competitive solar energy.

Among the conclusions from the study series, a recurring theme emerges that sustained innovation across all levels of the industry—from cell efficiency improvements, to faster and cheaper installation methods— will help to achieve the Energy Department’s SunShot goals.

The On the Path to SunShot series was developed in collaboration with leading researchers from the National Renewable Energy Laboratory, Lawrence Berkeley National Laboratory, Sandia National Laboratories, and Argonne National Laboratory.

Source: Energy.gov’s New Study Examines Progress Toward Sunshot Initiative Goals, Identifies Emerging Solar Energy R&D Opportunities for 2020 and Beyond

New reports from Navigant Research and Grand View Research raise two interesting questions: What is the relationship between energy management systems and building energy management systems (EMS and BEMS)? How are the definitions of these two terms changing as technology evolves and energy efficiency becomes a priority?

The Navigant research predicts that the global building energy management systems (BEMS) market will grow from $2.8 billion last year to $10.8 billion in 2024. The study clearly points to the fact that buildings – now “intelligent buildings” — are in the middle of great changes in telecom, information technology and energy generation.

The nature of the technology is that buildings are networked to create efficiencies. “Intelligent buildings become nodes in the Energy Cloud,” Navigant Senior Research Analyst Casey Talon told Energy Manager Today. “In other words, these facilities can be assets to balance grid pressures and sites for renewables and distributed energy resources to expand customer choice. The capacity to manage energy consumption in a dynamic way with automation, controls, and analytics is fundamental to the concept of the intelligent building, and this functionality is exactly what helps the intelligent building interact with the Energy Cloud.”

The Grand View Research Grand View Research took a broader view. It looked at the overall energy management sector. The report defines EMS to include power and energy, telecom and IT, manufacturing, retail and office, healthcare and other categories, according to the press release.

The research found that the global market will reach $58.59 billion by 2020. International standardization and global initiatives will be key drivers, the report found. The largest product segment is industry energy management systems (IEMS), which generated 60 percent of the overall category’s revenues last year.

A tremendous amount has been written during the past couple of years on BEMS and EMS. As time passes, it will become important for the vast ecosystem to understand how the two fit together. This will be especially vital from the marketing and technical perspectives.

An obvious goal of EMS and BEMS is more efficient energy use. However, things can get a bit tricky. Creating an energy-neutral building is difficult, but relatively straight forward. Depending upon the precise definition used, a building that meets certain goals – usually generating as much or more energy than it uses during given period of time – meets the objective.

However, to really get a picture of the impact that building is having, wouldn’t it be just as relevant to consider a broader set of variables? For instance, if the building is constructed in a rural area not served by mass transportation, it is fair to assume that more energy would expanded in workers commuting to work than if the building is closer to population centers or near a railroad station.

That context is one of the ideas behind The Sustainable Communities and Climate Protection Act of 2008. The Institute for Local Government says that the California law, which also is known as SB 375

…builds on the existing framework of regional planning to tie together the regional allocation of housing needs and regional transportation planning in an effort to reduce greenhouse gas (GHG) emissions from motor vehicle trips.

The law assumes that where the building is (in relation to transportation) is important. Thus, the determination of how energy efficient the building really is goes beyond the energy use of the building itself. In other words, it is technically correct but misleading to say that a building that generates as much as energy as it uses is energy efficient if it requires hundreds of people to drive commute to it via car every weekday.

That’s important. If energy efficiency is measured on a community-wide scale, the way in which managers approach things will be different. In such a context, it may not be necessary for each building in a community to generate as much energy as it uses. It may only matter what the numbers are on the broader communitywide scale.

Another way to phrase the question at the top of this post is this: How does adding tremendous connectivity and communications capabilities to the overall power grid change the role of an individual building in the context of its community?

EMS and BMS will infrastructure will be used to create and operate smart cities. The bottom line is that building managers and owners will need to understand where buildings fit in the big picture: How are the management capabilities and analytic data derived created by sensors and other equipment in the building relevant outside the structure? A good first step to answering this question is clearly defining the limits of EMS and BEMS.

BOULDER, Colo.–(BUSINESS WIRE)–A new report from Navigant Research examines the major trends and market issues expected to shape the future of intelligent buildings in 2016 and beyond.

Buildings are becoming data-rich environments as owners and key decision makers continue to invest in a variety of solutions that embody the technology foundation of the Internet of Things (IoT) and cloud computing. As building energy management systems (BEMSs) gain greater market penetration, building control algorithms are beginning to provide data beyond energy efficiency, including details on space utilization and operational efficiency. Click to tweet: According to a new report from Navigant Research, global BEMSs is expected to grow from $2.8 billion in 2016 to in $10.8 billion in 2024.

“Intelligent building solutions represent a new generation of tools that leverage today’s data-rich commercial building environment to help stakeholders across the value chain,” says Casey Talon, senior research analyst with Navigant Research. “This report highlights how intelligent buildings, in 2016 and beyond, will the generate more revenue, meet changing occupant demands, and respond to evolving policy pressures impacting the facilities industry.”

According to the report, just as the intelligent buildings industry is evolving, the power sector is also undergoing a shift from a linear framework of power generation and consumption to an interactive network, also known as the Energy Cloud. In the Energy Cloud, intelligent buildings join renewable energy, storage, and electric vehicles to become the energy nodes that replace the traditional, massive fossil fuel generation resources, while the IoT and cloud computing provide the platform of intelligence for the communication and analysis of energy data.

The report, Intelligent Buildings: 10 Trends to Watch in 2016 and Beyond, presents the top 10 trends for the intelligent buildings market in the coming decade. The report examines the major market issues driving investment in intelligent building solutions, as well as the business case and opportunities associated with various intelligent building solution areas, such as building energy management systems (BEMSs), intelligent lighting controls, and HVAC optimization. Each of the topics in this white paper is examined more deeply in research reports from Navigant Research’s Building Innovations Research Service and ongoing research. An Executive Summary of the report is available for free download on the Navigant Research website.

About Navigant Research

Navigant Research, the dedicated research arm of Navigant, provides market research and benchmarking services for rapidly changing and often highly regulated industries. In the energy sector, Navigant Research focuses on in-depth analysis and reporting about global clean technology markets. The team’s research methodology combines supply-side industry analysis, end-user primary research and demand assessment, and deep examination of technology trends to provide a comprehensive view of the Energy Technologies, Utility Transformations, Transportation Efficiencies, and Buildings Innovations sectors. Additional information about Navigant Research can be found at www.navigantresearch.com.

About Navigant

Navigant Consulting, Inc. is an independent specialized, global professional services firm that combines deep industry knowledge with technical expertise to enable companies to defend, protect and create value. With a focus on industries and clients facing transformational change and significant regulatory and legal issues, the Firm serves clients primarily in the healthcare, energy and financial services sectors which represent highly complex market and regulatory environments. Professional service offerings include strategic, financial, operational, technology, risk management, compliance, investigative solutions, dispute resolutions services and business process management services. The Firm provides services to companies, legal counsel and governmental agencies. The business is organized in four reporting segments – Disputes, Investigations & Economics; Financial, Risk & Compliance; Healthcare; and Energy. More information about Navigant can be found at navigant.com.

* The information contained in this press release concerning the report, Intelligent Buildings: 10 Trends to Watch in 2016 and Beyond, is a summary and reflects Navigant Research’s current expectations based on market data and trend analysis. Market predictions and expectations are inherently uncertain and actual results may differ materially from those contained in this press release or the report. Please refer to the full report for a complete understanding of the assumptions underlying the report’s conclusions and the methodologies used to create the report. Neither Navigant Research nor Navigant undertakes any obligation to update any of the information contained in this press release or the report.

The energy efficiency gap doesn’t exist because of a lack of effort or will, it exists because we have approached it from the wrong direction, write Ada Ámon and Ingrid Holmes.

Ada Ámon is a senior associate and Ingrid Holmes is a director at climate change think-tank E3G.

Energy Efficiency First: it’s a phrase that has been bandied about a lot over the past months. Vice President Šefčovič said “the energy we don’t use is our first fuel”.  But when we look at capital flows into this sector and the actual energy savings being delivered, it is clear that there is much more to be done to make good on this ambition.

The European Commission has admitted that the energy efficiency targets for 2020 will not be reached. But drawing the conclusion that the energy efficiency gap can’t be closed and so we should give up is the wrong one. The gap exists not because we haven’t been trying hard enough in policy terms: it exists because politically we have failed to properly grasp the shape of the challenge.  In short, we haven’t been thinking about energy efficiency in the right way.

We should be thinking of energy efficiency as infrastructure and prioritising actions to incentivise investment as we would for other infrastructure priorities. This view is backed up by the heavyweight economic consultancy, Frontier Economics, which found a strong case for reclassifying energy efficiency as infrastructure.

The key conclusions they drew from their extensive review of the academic literature is that energy efficiency requires huge upfront capital investment that will be locked for decades in form of physical assets that provide services and fulfil fundamental needs of society: the ‘textbook’ definition of infrastructure.

So it should not be surprising that the UK Government has included energy efficiency within its infrastructure planning arrangements and this summer Scotland announced that improving the energy efficiency of Scotland’s homes and non-domestic building stock will be designated a National Infrastructure Priority. This year also saw collective action from 36 NGOs, think tanks, business associations and companies from 18 countries in the form of a statement calling on G20 leaders to make energy efficiency an infrastructure priority.

Frontier Economics also point out that the multiple market failures around energy efficiency create a strong case for governmental interventions to drive this investment forward. In the same way other market failures are currently being tackled to deliver the EU’s internal energy market, a digital single market and the Capital Markets Union.

The strong public interest case related to improving the energy efficiency of the EU economy only reinforces the intellectual rational for declaring energy efficiency a public infrastructure investment priority. Macroeconomic analyses undertaken in for the UK, Germany and Hungary show very favourable returns on public investment  – in terms of revenue streams to government, current account deficit reductions due to lower imported energy costs and widely distributed job creation.

Wouldn’t these be good enough reasons for any savvy finance minister to consider accommodating energy efficiency within infrastructure budget and planning to deliver the investment needed to harvest these vast macroeconomic gains?

Apparently not. Perhaps mainly because the benefits are just not visible currently in EU or member state decision making. Making energy efficiency a public infrastructure priority would address this ‘invisibility’ problem. Treating energy efficiency like other public infrastructure would require both the European Commission and Member State Governments to undertake a full economic appraisal of the costs and benefits on delivering investment programmes.

This would completely change the optics around the affordability discussion that led to a measly 27% energy efficiency target being agreed by the European Council last year. It would also help open up a discussion on what constitutes the best value public spending decisions – which is just what we need to see in the context of decisions about delivering the Energy Union.

It would also have the effect, at a member state level, of shifting decisions when it comes to national budgets. The capital allocation to energy efficiency programmes would be taken out of the discussion on operational spending priorities and put to decisions about capital investment.

The European Fund for Strategic Investment (EFSI) already recognises this value through positive screening measures for energy efficiency included within the EFSI scorecard. This opens up questions about why under the terms of the Financial Stability Pact there aren’t measures to incentivise investment in this highly productive sector.

Finally, in defining energy efficiency as infrastructure, the logic should follow and State Aid rules need to be revised where currently supply side infrastructure is allowed 100% public finance support but for energy efficiency only 30-50% is the limit.

So if Mr Šefčovič is really behind his own words then ‘First’ really should mean first. It means thinking of energy efficiency as an infrastructure priority. Energy efficiency should be the base-load infrastructure from which Europe’s Energy Union supply side infrastructure is built.

Once the energy system planning has been done right, energy efficiency must then be given the same political and financial support as supply side energy infrastructure projects receive. This will mean moving forward in a comprehensive way to address the multiple financial, economic, market and institutional barriers that exist at EU and member state level to deliver Energy Efficiency First.

The time has come to walk the talk on Energy Efficiency First and translate this slogan into a set of real political priorities and actions. We can start by declaring energy efficiency a key infrastructure priority within the Energy Union and lead the way for member states to do the same.

Date: September 2nd, 2015
Author: Robert Spence

One of the most common ongoing challenges for mining companies is minimizing energy consumption. Due to the energy-intensive nature of mining, it’s the one variable every company would love to control.

In the United States, fossil fuels represent the largest portion of a mine’s total energy use at 35 percent, followed by electricity at 32 percent. Along with resulting in significant savings, reducing energy consumption at a mine can also reduce greenhouse gas emissions.

As commodity prices remain stagnate and operating costs go up, the time is now for mining companies to investigate renewable energy sources and shed their reliance on external energy sources. We present the framework to achieve this.

Develop a plan

Sounds simple enough but developing a solid plan is critical to reducing energy consumption in mining. A thorough plan should outline the company’s objectives while revealing short and long-term goals to achieve it. It should also establish a starting base in order to consistently evaluate and fine-tune actions. Never underestimate the powers of a thorough plan

Choose a management system

Once the plan is developed, it’s time to choose an energy management strategy. They’re great tools to streamline processes as they are tied directly to mine production systems, providing consumption data. In fact, these management systems can provide:

  • Real-time energy consumption.
  • Energy consumption forecasting based on specific parameters.
  • Establishing optimal energy consumption targets for each mine area.
  • Identifying and quantifying consumption above targets.
  • Identifying and analyzing root causes of over-consumption.
  • Reporting of over-consumption and changes in daily consumption.
  • Understanding energy drivers such as process variables linked to energy consumption.
  • Real-time calculation of sustainability Key Performance Indicators, such as kWh/t.
  • Providing validated data to justify future capital investments and/or process changes.
  • Creating energy models to forecast energy consumption and to determine energy targets.

Investment

Once the management system is selected, and a company has reviewed its regular energy consumption, the next step is to invest. One of the main products at the core of an energy efficiency strategy is smart meters. These unique devices have the ability to deliver critical information such as voltage, current, neutral and earth current, power, frequency, power factor, demand, energy and time-of-use metering from the mine loads.

Smart mining breakers are another potential investment as they assist in obtaining actionable energy data, including:

  • kWh meters helps optimize costs and their allocation.
  • Harmonic distortion rates show the quality of the electrical supply.
  • Alarm notifications help secure operational control and maintenance planning.
  • Continuously activated event logs and tables ensure equipment operates correctly, thus maximizing energy efficiency.

Continuous improvements

The real trick to reducing energy consumption is through continuous improvement. By continually monitoring, tweaking and reporting new updates, companies can steadily improve system stability and unplanned downtime. In addition, such systems can assist in tracking and investigating frequency stability, voltage variations, imbalances, harmonics and other conditions in order to maintain a high level of power quality, including resolving problems before they develop.

Article online at: http://www.miningglobal.com/operations/1652/The-framework-for-reducing-energy-consumption-in-mining

Date: August 24th, 20145
Author: Karen Henry

Electricity accounts for 32 percent of a mine’s total energy use, so finding ways to reduce energy use can result in significant savings for mining companies. Grinding and ventilation offer the greatest potential for reducing energy use in the coal mining industry, according to an article on the coal mining industry, according to an article on the World Coal Website.

In addition to savings achieved through improvements in equipment efficiencies, the article outlines a number of strategies and technologies that can be used to further reduce electricity use:

  • Create a strategic plan. Creating a plan will not only help the mine achieve long-term results, it will also provide a base upon which to consistently evaluate and fine-tune actions against planned objectives.
  • Choose an energy management strategy that will achieve the best results. A passive energy management strategy leverages systems that are designed to use less energy. An active energy management strategy relies on deploying and monitoring motor controls, ventilation controls or process optimization to achieve the best results.
  • Choose an energy management system (EMS) that is tied directly to mine production systems. In addition to providing data about real-time energy consumption, this type of EMS is also able to identify and quantify consumption that exceeds targets, identify and analyze the cause of over-consumption, analyze elements that are driving energy consumption, calculate key performance indicators, provide validated data to justify future capital investments, and create reports and energy models to forecast energy consumption and determine energy targets.
  • Invest in smart meters. Smart meters deliver rich information about energy use from critical mine loads.
  • Use smart mining breakers to obtain actionable energy data. In addition to their typical protection capabilities and robustness for harsh coal mine environments, these breakers deliver energy information thanks to integrated meters.
  • Monitor power quality and reliability. Sophisticated power quality monitoring and reporting provides the information needed to validate compliance, improve system stability and minimize unplanned downtime.

It’s also important to choose a trusted engineering partner with proven energy consulting experience. Integrating the right tactics with the right partner can help optimize energy consumption throughout the mine’s lifecycle.

Article online at: http://www.energymanagertoday.com/tips-reducing-energy-consumption-mining-industry-0114886/

By: James Madej

The idea of big data – collections of information so large that only advanced analytical systems can make sense of them – has gained traction in a growing number of industries over the past few years.

The energy sector, its customers – and the environment – can also benefit from the use of big data. The appropriate use of information and analytics will be critical to achieving our shared economic and environmental goals, especially given the urgency of climate change. Bringing American energy into the 21st century is imperative – and an incredible opportunity.

How big is the opportunity? Consider this, the U.S. is dead last among developed nations when it comes to energy productivity. Shockingly, the U.S. wastes more energy than it uses. A whopping 57 percent of the energy flowing into our economy is simply wasted as heat, noise, or through leaks. Even China, a so-called developing nation, ranks ahead of the U.S. in terms of the efficiency of its energy infrastructure. Analyzing and understanding where, why and how this waste occurs and finding ways to fix the problem is – you guessed it – a job for big data.
To encourage the types of data-driven insights needed to achieve meaningful economic and environmental advancement, the Commission on National Energy Efficiency Policy – formed through the Alliance to Save Energy – has called for a doubling of U.S. energy productivity and efficiency by 2030. Achieving this goal could add 1.3 million jobs to our economy, boost GDP by 2 percent, and reduce carbon emissions, as well as oil and gas imports, by more than 30 percent.

Even with renewed attention and support from policy-makers and politicians, achieving these goals will not be easy. It is important that everyone recognize that getting there will be a marathon rather than a sprint. Here is how we will get there – and how data will help – especially as it relates to our use of electricity:

  • The first step is to outfit and update our energy infrastructure with the steel and software necessary to collect and analyze the required data.

    This calls for a greater level of sophistication around data collection and analysis, as well as a broader set of information than might have been considered in the past. We need not only performance and consumption statistics, but also behavioral and demographic information – and with them the ability to ensure customer privacy and data protection.

  • Lay out the potential of big data so every customer – whether they are large or small, residential or commercial – understands how it can support energy savings and provide an environmental upside.

    The goal is to provide customers with the right information in simple formats that can be used immediately to make smarter energy consumption decisions. Using big data to improve energy choice, applications and management will be a game-changer in terms of energy efficiency and economic growth.

  • Put big data – and the insights it provides – to work to improve operations and shape public policy for the benefit of our business, our customers, our communities and our environment.

The cost of doing this will not be trivial. According to the Utility Analytics Institute the industry is poised to invest more than $2 billion on its data infrastructure over the next 12 months. And that is in addition to the more than $2.5 trillion the International Energy Agency estimates the industry needs to invest by 2035, most of it to replace aged equipment.

Energy companies will shoulder an increasing responsibility for conserving energy and addressing climate change. To support the necessary investment, an innovative regulatory framework is needed; one that rewards companies for providing economic and environmental benefits and penalizing them for falling short. Measures such as the Energy Savings and Industrial Competitiveness Act of 2015 – introduced by Sens. Rob Portman (R-Ohio) and Jeanne Shaheen (D-N.H.), passed Congress and was signed into law by President Obama on April 30, 2015 – are a step forward.

The energy industry’s use of big data may seem abstract and future-focused. However, real progress is being made at a number of companies across the U.S. These investments are improving operational efficiency, reducing the cost of energy for our customers and helping protect the environment.

Madej is senior vice president and chief customer officer for National Grid.

Original article online at: http://thehill.com/blogs/congress-blog/energy-environment/247559-big-data-means-big-energy-savings

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World leaders have shaken hands on the new Sustainable Development Goals that will hopefully be shaping global and local agendas and policies over the next 15 years. The UN Sustainable Development summit coincided with the 7th edition of Climate Week, which was jam-packed with well-timed announcements and strong messages in favor of a low-carbon economy.

The media spotlight shone brightest on groundbreaking commitments from big brands such as Starbucks, Nike and Walmart, all carrying the same message: Going low-carbon and investing in renewable energy is a tremendous business opportunity. By announcing their participation in the RE100, a global renewable energy campaign led by the Climate Group and CDP, the companies have pledged to become 100 percent powered by renewable energy. Put simply by another leading signatory, IKEA: “Generating our own energy renewably will insulate us against the price fluctuations in energy costs.” Indeed: Shrewd companies will be able to invest profits made from renewable energy generation back into their business and ensure the wellbeing of the resources their future depends on.

The growth of the renewable energy sector has seen another record year, according to the Renewables 2015 Global Status Report. The cost of renewable power has fallen considerably in recent years while consumer demand for affordable, clean sources of energy has soared. Alongside the RE100 initiative, the Buyers’ Principles also builds on the compelling business case for renewables, while working to facilitate access and wide-scale adoption of renewable energy among companies. Launched by the World Resource Institute (WRI) and WWF, the Buyers’ Principles advocate for six criteria that would significantly help companies meet their ambitious purchasing goals, including an emphasis on the access to new projects that reduce emissions beyond business as usual.

Signatories of the Buyers’ Principles – including Intuit, Yahoo, Staples, Microsoft andeBay – will be happy to know that access to renewable energy products and premiumRenewable Energy Credits (RECs) is already available; businesses have the means take action. The savviest ones have not missed the opportunity to do so.

While cloud solutions represent a major growth opportunity for SAP, energy-intensive data centres remain one of the main challenges to tackle, for the market leader in enterprise application software. SAP’s quick growth has also bulked its electricity use and CO2 emissions, adding to the 2 percent of global greenhouse gases emitted by the IT sector. Given the significance of its electricity consumption, accounting for one quarter of total CO2 emissions, the company decided to look for a way to power its operations worldwide with 100 percent renewable electricity, and get #readyfor2020. Opting forGoldPower, premium renewable energy certificates (REC), the company has started leveraging renewables as a powerful differentiator for attracting and retaining customers, employees and investors. So far, the Walldorf, Germany-based multinational has been on the winning side: Aside from powering all operations and major events with 100 percent renewable energy at a competitive price, SAP’s actions spell out a genuine commitment to sustainable development and social responsibility.

SAP is just part of the growing number of companies who have electricity as a prime resource in their value chain. Being able to trace the origin of power has never been more important. Renewable energy products such as RECs offer a unique ability to support new renewable energy projects and to engage with stakeholders. RECs contain and disclose the renewable sources from which the electricity is consumed and are issued for every megawatt-hour (MWh) of electricity produced by a power station. Products such as GoldPower ensure certification by the Gold Standard Foundation on the additionality claim of each power plant that generates the respective RECs. This claim ensures that the plants would not have reached financial closure without the revenues from the sale of environmental attributes.

The need for reliable certification systems to identify the sources of electricity has become increasingly imperative amid all the pledges for going 100 percent renewable. RECs can provide companies with much needed solutions in the rapidly changing energy market. As underlined by many RE100 signatories, the failure to adequately manage corporate energy can leave a company vulnerable to risks, such as changing regulations, legal requirements and price fluctuations. What is more, being seen as a big polluter carries detrimental effects for any brand – a prime example being the ongoing scandal involving Volkswagen.

Lowering risk, saving millions and boosting brand value – all benefits that these forward-thinking companies can already expect to cash in for parting from fossil fuels and integrating renewable energy into their business. Savvy companies that are quick to act will stay ahead of the curve and profit from the ongoing transition to the low-carbon economy. It’s time for business to ink in their sustainable development goals alongside world leaders and ensure that they will be around over the next 15 years and beyond.

Source: Nadia Kähkönen’s #BusinessCase: Why Renewable Energy Will Make or Break Business Success on Sustainable Brands

Savvy companies can use their warehouse management systems to uncover hidden inefficiencies that waste energy and money.

By Ben Ames

A bustling distribution center is a crucial cog in most logistics operations, but these busy facilities can also run up big bills of their own, not to mention suck up energy. In the relentless search to cut costs and “green up” their distribution operations, many companies are turning to an unlikely tool—their warehouse management system (WMS).

DCs have traditionally used their WMS platforms to direct basic material handling operations, such as planning a swift, efficient path for moving goods through the DC and directing complex tasks like picking and shipping. That hasn’t changed. But now, some are finding that every time the WMS identifies a wasteful step in a distribution operation, it’s also an opportunity to trim the building’s power bill—cutting costs and saving the planet at the same time.

The typical DC incurs expenses around the clock, burning electricity to keep the lights on and conveyors humming, hosting up to three shifts of pickers and drivers each day, and heating or cooling large volumes of air. Reduce that electric bill, and a DC manager can cut the company’s utility costs and shrink its carbon footprint. That’s good for company budgets, the environment, and the corporate image. The only problem is figuring out how to get it done.

With the ability to instantly analyze thousands of moving pieces in a complex logistics operation, WMS software can provide the answer. For example, the software might be able to uncover opportunities to save energy by cycling conveyor belts off during idle times or using occupancy sensors to switch off lights in empty rack aisles.

“You can use a WMS both to run a warehouse most efficiently and to get maximum productivity,” says Jason Mathers, senior manager for supply chain logistics at the Environmental Defense Fund (EDF), an advocacy group that partners with companies to find ways to reduce their environmental impact. “The goal is (to figure out) how to run a variable volume through a distribution center,” Mathers says. “These are very dynamic environments. You want to be able to scale up how you use equipment to meet peak demand, but you don’t want your system optimized for peak flow when it’s the slow time of year.”

When it comes to energy-saving strategies, Mathers speaks from experience. Through its Climate Corps program, EDF matches business school students with companies on 10-week fellowships to find energy savings that benefit both the environment and the bottom line. Companies that have enlisted these specialists to identify savings opportunities in their warehouses include Adidas AG, Coinstar, Mondelez International Inc., Target Brands Inc., and Recreational Equipment Inc. (REI).

The results can be jaw-dropping. For instance, in 2013, Office Depot Inc. brought a Climate Corps intern into its retail and supply chain operations in Boca Raton, Fla., and identified potential long-term savings opportunities of $6 million in its building systems and operations alone, thanks to annual electric savings of 32,000,000 kWh and an annual reduction in carbon dioxide emissions of 16,000 metric tons.

Not all companies will uncover savings of this magnitude, of course, but that’s not to say they shouldn’t give it a try. They might be surprised by how much waste they can root out. “There are energy efficiency opportunities just waiting to be found,” says Mathers.

So how do you go about identifying those opportunities—and where does your WMS fit in? What follows are four ways to leverage the power of software to cut both warehouse costs and your carbon footprint:

1. Buy electricity at off-peak rates. A large warehouse can cut its electric bill by participating in a demand response program with its local utility, Mathers says.

For power companies, the cost of producing electricity varies widely across days or even hours, such as when a producer has to fire up additional generators to meet peak demand or when low rainfall causes a hydroelectric dam’s production to drop. The price we pay for electricity, however, does not fluctuate in most places (except in regions that have deployed smart meter technology).

To compensate, some utilities will actually pay large customers—such as warehouses—to shut down key pieces of equipment during periods of peak demand. A DC that can use its WMS to ramp down operations at key times and reschedule them for nonpeak periods can reap a big return.

“The cost of generating one more kilowatt of electricity at 4 p.m. on a hot day in Texas is quite significant,” Mathers says. “So this is one way for companies to reduce their power bill and their carbon footprint.”

2. Rein in forklift costs. Seasonal and cyclical factors can have a big effect on warehouse energy costs. Rising oil prices can boost the cost of operating trucks and forklifts, and the extremes of winter cold or summer heat can punch a hole in any heating or air conditioning budget.

“The pressure to save money in warehouses goes up with variables like fuel costs,” says Thomas Kozenski, vice president of industry strategy for JDA Software Group Inc. “Because people have budgets, if gas prices suddenly go bananas, they’ve got a problem. And they will do something—anything—to cut those costs.”

One way to slash fuel costs is to use the WMS to identify wasteful forklift travel patterns. Whether the facility runs lift trucks powered by propane or by batteries, it will save money and energy by finding shorter, more efficient routes, Kozenski says.

Another approach is to calculate the smallest number of forklifts a facility needs to get the job done. A surefire way to avoid rising fuel bills—and emissions—is to avoid buying that extra forklift in the first place.

“That could allow a user to use eight forklifts, whereas if you didn’t have a WMS, you might need 10 or 12 forklifts to get the work done,” Kozenski says.

3. Cut packaging waste. A WMS application can also shrink warehouse costs by cutting waste in packaging. If you’re running a high-volume fulfillment and shipping operation, chances are, you’re shipping part of your profits out the door every day.

“Part of sustainability is figuring out how you can use less material to get the job done,” says Kozenski. “You get boxes at home delivered by UPS, filled with popcorn, white Styrofoam, or shredded newspaper.”

Many WMS platforms can calculate the optimal “package profile,” that is, the minimum size box and smallest amount of packing material needed to prevent damage to the package’s contents during shipping. The result is an instant reduction in material costs and environmental impact, but there are additional benefits.

Thanks to the compact design, those smaller boxes can be packed more densely onto a truck, while reducing the potential for damage during transport. This approach can also save money on shipping costs at a time when both UPS Inc. and FedEx Corp. have adopted dimensional weight pricing for ground shipments, charging more for packages with greater volume.

4. Boost labor efficiency. Workers cost money, whether it’s measured in salaries or the cost of keeping a workspace warm, well lit, and ventilated. That means DCs can cut costs by helping pickers do their jobs more efficiently, using an approach called “system-directed work.”

Built into many WMS applications, this function identifies ways to avoid unnecessary travel between racks, shelves, and pick stations. Instead of requiring pickers to return to a central location after finishing each task, a warehouse can use radio-frequency (RF) equipment or voice technology headsets to immediately direct them to the next task.

“We tell the operator what to do, then what to do next, then what to do next, then what to do next,” Kozenski says. “The workers love it—they can just do their job, and at the end of the day, they get to go home and have a beer.”

This approach is also helpful for training new hires, a task that can be a full-time job in an industry where employee turnover runs as high as 20 percent per year, he says. Once a client has loaded a detailed warehouse map into its WMS, the system can easily direct new hires to the location of a certain aisle, row, or shelf.

A PAYOFF ON SEVERAL LEVELS

Cutting warehouse costs by reducing fuel consumption, electric bills, and greenhouse gas emissions is an investment that pays off both in more sustainable operations and in bottom-line profits. However a company justifies the decision to run a more efficient distribution center, it will see a payback on several levels.

“Some companies are more interested in green operations and sustainability than others, but everybody is interested in cost savings,” Kozenski says. “Efficiency is not a separate application.

“We’re in a world where all our customers are in continuous process improvement (mode),” he adds. “They are always looking for an additional way to save a little more money.”

Original article online at: http://www.dcvelocity.com/articles/20150723-four-ways-your-wms-can-cut-costs-and-green-up-your-dc/

June 29, 2015

Today, Naya Energy CEO and Founder, Ketan C. Patel, will speak at BOMA International’s 2015 Every Building Conference & Expo in Los Angeles, CA. He is presenting a session on Global Energy Initiatives Track, “What the West can Learn about ‘Going Green’ from the East.”

Mr. Patel will share how energy management in Asia differs from the West. Asian companies and managers value solutions that are both easy to deploy and quick to produce savings. Focusing on tangible solutions has allowed Asian companies to “Go Green” (save energy) by “Growing Green” (growing profits).

For more information, please visit:

http://www.bomaconvention.org/boma2015/public/SessionDetails.aspx?FromPage=Calendar.aspx&SessionID=659&SessionDateID=40