Challenge/Solution Case Study:
Reducing Energy Costs for an HVAC Equipment OEM
EFI Group established a basis for immediate and future energy cost reduction actions for the client by linking specific processes to their respective utility costs, thereby enabling utility costs to be treated as a controllable operational budget item versus a relatively uncontrollable fixed budget item.
Historically, utility costs were booked as fixed expenses and thus were difficult to control. The client sought to understand the impact of utility costs on the plant’s operational budget, as well as any opportunities to control those costs.
EFI Group’s challenge was to thoroughly understand the electrical power, natural gas, propane, water and fuel oil costs, which included:
- Analyzing historical trends
- Quantifying energy consumption for individual processes
- Developing specific opportunities to reduce costs
EFI Group reviewed past utility statistics and provided graphical representations of both usage and costs, defining and quantifying major uses (contributors) to ensure an understanding of the specific areas/processes using utilities.
EFI Group then separated fixed costs (space heating) from variable costs (specific to an operating process), enabling a clearer picture of the effect of utility cost on changes in operational output, as well as the utility cost effect on the unit cost of the operation.
The team was able to define significant opportunities for cost reduction and calculate expected savings opportunities using the major components of utility use, primarily electrical power and natural gas costs.