Benchmarks Energize Industrial Efficiency

Feb. 9, 2008
Learn how your energy consumption compares with other companies in your industry.

You're reading a story in your favorite trade publication (hopefully IndustryWeek) about the successful energy-savings features that a steel mill implemented two years ago. The information provides some valuable tips but isn't directly relevant to your industry because you work at an oil refinery.

That's where benchmarking tools such as the Environmental Protection Agency's Energy Performance Indicator (EPI) tool come in handy. The ideal way to understand where energy-reduction opportunities exist is by comparing your operations to a like industry, says Gale Boyd, director of the Triangle Census Research Data Center in the Department of Economics at Duke University.

"Particularly for a small manufacturer, they may know how Plant A is doing compared to Plant B, but they may not know that Plant A is barely average compared to the industry," Boyd explains. "So if their peers are doing better, that tells them something about what they should be able to do, and since a lot of businesses are in competition to improve, knowing where you stand in the race is an important part of the picture."

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Boyd has been working with the EPA's Energy Star program to develop performance indicator tools for various industries, including the energy-intensive cement, oil, corn refining and petrochemicals sectors. So far, Boyd and the EPA have completed EPIs for the cement, corn refining and motor vehicle manufacturing industries. In 2008 Boyd expects to complete EPIs for the pharmaceutical, glass and parts of the food processing industry. Boyd also began work recently on the pulp and paper and petrochemicals sectors.

The EPI is an Excel-enabled tool that allows users to input certain plant data that is calculated based on a formula. Participants can then compare their data to the industry average and see their percentile ranking. To view an example of an EPI in the cement industry visit and click the "Download the Cement Plant EPI" link. A plant is considered to be efficient if it ranks in the 75th percentile.

"So it answers the hypothetical question that if all the plants in the industry look just like mine, where would I rank? And we turn the ranking into a scale of one to 100, so if you're in the top 10 percent of performers, you would get a score of a 90th percentile."

Once a ranking is achieved, the participating company can then use the information to assess its strengths and weaknesses and develop energy-savings measures.

"In every one of these industries the opportunities are different," Boyd says. "In auto assembly, it's painting cars. In corn refining it might be cogeneration as well as efficient operation of pumps and motors. For cement you have the kiln itself, which is a huge energy user but also all the grinding that goes into preparing limestone feedstock."

The performance indicators are part of the EPA's Industries in Focus tools designed for specific manufacturing sectors. Resources include energy guides that provide energy-savings recommendations and analytics for a particular industry and networking events and meetings.

About the Author

Jonathan Katz | Former Managing Editor

Former Managing Editor Jon Katz covered leadership and strategy, tackling subjects such as lean manufacturing leadership, strategy development and deployment, corporate culture, corporate social responsibility, and growth strategies. As well, he provided news and analysis of successful companies in the chemical and energy industries, including oil and gas, renewable and alternative.

Jon worked as an intern for IndustryWeek before serving as a reporter for The Morning Journal and then as an associate editor for Penton Media’s Supply Chain Technology News.

Jon received his bachelor’s degree in Journalism from Kent State University and is a die-hard Cleveland sports fan.

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