Best Practices -- Productivity Surge

Jan. 21, 2005
Schulte Corp.'s double-digit growth demanded more power.

Prior to its new electric distribution system, Schulte Corp. caused a flicker in the neighborhood. The manufacturer of home storage and organization products based in Bloomington, Ind., literally caused the lights to flicker in homes and businesses close to the plant located on Liberty Drive.

According to Steve Koehl, plant engineer at Schulte, "We were essentially a bad [utility] customer.

"My home is about a mile from the plant, and I could literally tell if we were running our equipment in the factory because I could see my desk lamp flicker."

According to Koehl, Schulte has been experiencing double-digit growth for the last four years and desperately needed to expand operations. The biggest factor in the expansion -- getting the appropriate electric service needed to support operations.

"At our Liberty Drive plant the utility [company] currently isn't able to supply our needs because we do resistance welding, which is very brutal on power systems," says Koehl. "The utility measures an item they call flicker. To hold that flicker number down, the utility company asked us to put a limit on our production and expansion at the facility."

Schulte needed a resolution in order to grow. So, the 180-employee company began moving to a bigger plant. In fact, it moved to another Bloomington plant equivalent to 11 football fields, or 630,000 square feet. (The Liberty Drive plant still operates, but all operations eventually will relocate.)

Once a larger plant was found, Schulte moved to the second step of solving it's energy crisis -- eliminating the need to interlock welding machines, which essentially kept two machines from operating at the same time because of the power drain, thus causing the company to have to put more equipment on the floor just to keep up with demand.

"What [interlocking] did to us was reduce capacity on those two machines by 25%," says Koehl. "Basically I'm telling our shareholders that if I spend a million dollars on a machine, I'm only going to give $750,000 in return."

Another issue that needed to be addressed was moving the welding service transformers to within a few feet of the production equipment.

"In the Liberty Drive plant, power had to be transmitted some distance across our plant to the actual process. There's a phenomenon that occurs called voltage drop over those types of distances that severely impacts the amount of energy that's available to actually cause the weld to occur. In the new facility, which is four times the size the Liberty Drive plant, there was just no way that we could transmit that power across a plant that size and be able to live with the voltage drop that would occur. We would not have obtained quality welds."

The solution: Schulte needed to get on a transmission line where the substation was large enough to service the load. The company called on Cinergy Solutions, a diversified energy company located in Cincinnati, where Schulte's corporate headquarters is also located.

"Cinergy was able to come to the table with a solution that allowed us to keep operations in Bloomington, and at the same time remove capacity constraints that we were operating under and give us enough capacity for growth well into the future."

In fact, the company plans to double its workforce within the next five years.

According to Jerry King, director of business development at Cinergy, a high-voltage substation that has two large step-down transformers, one that goes to the weld power and one that goes to house (non-production) power, was built outside the building to alleviate Schulte's problems.

"On the inside of the plant Cinergy put in three weld substations, a house substation and a substation to power finishing. What took away the flicker problem was how we sized the transformers and minimized the amount of impedance in the system," explains King.

Cinergy also gathered all involved parties to ensure that Schulte's process would not impact others.

"Basically we coordinated with local utilities and vendors and suppliers," says Ray O'Neal, also a director of business development with Cinergy.

According to Cinergy, cost for the project was in the $1.4 million range.

"But the benefits to them come in two ways," says O'Neal. "It comes in dollars saved on energy, because during our process we realized they could buy energy at a cheaper rate at a higher voltage, and in future capacity."

Indeed, "The new system keeps us from having to buy or build new equipment for hopefully some time," says Koehl. "We have the ability to put six of these large welding operations on this new system and possibly even beyond that -- that's what it's designed for."

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