Industrial Utility Efficiency    

How has 3M Canada Cut Energy Use by 32%?

3M is recognised as a world leader in energy efficiency, hands down. Since 2008, the company has reduced energy use by 32%. This result by far exceeds the 20% reduction goal, aspired by many companies.

How does 3M work with energy? What can other companies learn from their experience?

I brought these questions to Andrew Hejnar, Energy Manager of 3M Canada, and the results of our conversation are shared in this interview article.

 

How Does 3M Make Big Decisions About Energy?

Energy management at 3M is an integral part of the company’s general business strategy. Energy is understood as a means of advancing the long-term goal of #improvinglives -- lives of employees, lives of clients, and life of society.

3M Company has been at the forefront of sustainability since 1975, when 3M launched Pollution Prevention Pays as a means of empowering employees to guide the company’s sustainability efforts. One of the directives in the 1975 corporate policy, which has not changed in 30 years, is that 3M “will prevent pollution at the source wherever and whenever possible.”

A separate Energy group was formed at 3M Canada in 2007.

The 2025 sustainability goals include specific energy use goals:

  1. Increase energy efficiency by 30%.
  2. Reach 25% level of using energy from renewable sources in total electricity use.
  3. Reduce GHG emissions by 50% compared to 2002.

At 3M, energy efficiency goals are set at the corporate level as part of the general business strategy. The complete list of sustainability goals and summary of progress report is published on the 3M corporate website here.

 

3M Adheres to Best Practices to Achieve Energy Reduction Goals

To achieve energy use reduction goals, 3M relies on established best practices compiled in ISO 50001 and further in Superior Energy Performance program (SEP), established by the US Department of Energy.

According to DOE, “The facilities in SEP have met the ISO 50001 standard and have improved their energy performance up to 30% over three years.”

DOE have proven that “energy performance improvements at the certified facilities were significantly greater—up to 65%—compared to the non-certified facilities.”

ISO Graph

Most 3M plants have passed both ISO 50001 and SEP certifications already. The rest are working towards being fully certified. To maintain ISO 50001 certification, plants submit annual reporting, which helps keep the plant on track and maintain performance. The next milestone is to develop and implement a corporate-wide energy management standard. 

 

Three Pillars of Energy Management at 3M

Being a leader in innovation, 3M could not have possibly stopped at just implementing the best energy management practices, the company had to advance them.

In many companies, energy management work is understood as the implementation of new machines and processes. 3M works in a broader business context to achieve better results and do it faster. Energy management at 3M is supported by three pillars:

1.     Monitoring and Targeting (M&T)

‘You cannot manage what you do not measure’ - Lord Kelvin’s idea has been popularised by management guru of the 20th century, Peter Drucker. 3M has embraced this idea. The company collects energy data, both in physical and $-terms, and then processes it using regression analysis to produce baselines in accordance with recommendations of IMPVP and requirements of SEP. This approach enables sensible monitoring of consumption in real-life conditions.

‘Energy is often invisible. M&T makes it visible,’ – Andrew Hejnar. 

Deviations from baseline predictions are closely monitored to ensure stable, efficient performance. In some instances, operators are required to monitor energy consumption continuously at machine level and report deviations in excess of 3% as they occur.

2.     People

3M considers people to be the key to success of energy management, because no technology works without people. 3M has consistently integrated sustainability culture into daily operations since 1975. 

Today, every employee, from CEO to janitor, has to take sustainability training during onboarding process and repeat this training every two years.

Sustainability culture pays off handsomely: operational and behavioural changes contribute 30% to overall consumption reduction with zero capital investment. Atop of measured energy use reduction, managers at 3M report higher productivity of employees engaged in energy efficiency work.

3.     Technology and projects

Energy efficiency technologies and energy waste reduction projects form the most obvious pillar of energy management – implementation of efficiency projects, installation of new machines, and controls.

Current energy management projects at 3M go far beyond VFDs and LEDs. Among implemented projects are heat recovery from ovens and compressors, installation of electric blowers and mixers instead of using compressed air, and installation of a behind-the-meter CHPs.

 

How Does 3M Find Energy Projects?

The energy management team of 3M Canada consists of four people; obviously not enough to do all the work on their own. 3M used to hire consultants to find and evaluate projects. Today, the energy management team facilitates and coordinates work of plant engineers and employees, who identify, evaluate, and implement most of the projects.

Here are a couple of tricks of the trade:

Energy Treasure Hunt

A group of engineers from different plants joins the local team to perform an Energy Treasure Hunt at a selected plant. First, the combined team walks the plant floors in an effort similar to a walk-through energy audit. Then, a brainstorming session follows. The generated results are left to a local team for deeper evaluation.

All employees contribute ideas to energy reduction

If nobody does efficiency work on a regular basis – results never come.

Since 3M wants efficiency to happen, the company rewards employees for improvement suggestions, even when these suggestions turn out to be unfeasible and not implemented. Since 1948, 3M has allowed employees to dedicate 15% of their paid time to their own projects. This is when innovation, including ways to reduce energy use, is born.

 

How Does 3M Evaluate Energy Projects?

While many companies limit their choice of energy projects with those promising an under 2-year payback, 3M takes a longer perspective to achieve much higher results.

3M evaluates energy projects based on NPV over 10 years -- the same ratio company uses for all CAPEX projects.

What differentiates energy projects, however, is that non-direct financial benefits, such as employee comfort or sustainability impact, are considered during evaluation.  To account for these benefits, projects can apply for a contribution from internal Sustainability Fund final financial evaluation.

 

How Does 3M Monitor Results of Energy Projects?

Measuring results in energy is rarely a straightforward process.

Many companies set reduction goals in absolute numbers: ‘Reduce consumption by 20 GWh by 2020 compared to 2010.’ Though absolute metric is easy to track, aiming for it may limit business growth. The same trouble happens with measuring reduction in %% of absolute numbers. Measuring energy use reduction in %% of sales is fogged by profit margin variations.

3M has set reduction goals as percentage of the value predicted by regression-based baseline specific to each plant.

In effect, each plant competes with itself in energy intensity reduction. Each plant is different. Each plant manufactures its unique set of SKUs. Competition with itself is the only way actual efficiency changes can be registered. In my opinion, this approach manifests the bold commitment to integration of energy efficiency and business.

This is hardly the simplest method, but 3M is hardly a simple company. Use of baseline method supports core business: if plant increases production, it is not penalized for extra energy use. In fact, aiming for  energy efficiency often leads to higher asset utilisation, lower stoppages, and higher production throughput. On the other hand, decreased production does not contribute to energy savings either.

 

3 Tips to Succeed with Energy Projects from 3M

Andrew Hejnar recommends:

1.     Secure high-level support of energy projects as soon as possible.

Energy touches every aspect of manufacturing process. Changes require will, coordination, and cooperation, not to mention funding and resources. All these are much easier to secure with a high-level champion.

2.     Involve utilities.

Energy efficiency specialists at utility companies are involved in dozens of projects that may benefit your plant. These people are willing and available to help find projects, provide temporary metering equipment, and to form projects in a way to secure the most incentives.

‘A plant walk-through with a utility rep often opens a different perspective’, - Andrew Hejnar.

3.     Energy management is a team game.

Energy links all equipment and most manufacturing processes. Every process requires energy. Thus, to be successful, energy management must be a collaborative process as well. A plant may invest thousands/millions in highly efficient machines; still a sloppy operator or an outdated procedure may waste all the savings. On the positive side, joining forces with existing plant-level sustainability specialists may help HQ implement an energy project faster, because local people know local ways to get things done.

 

What Can You Do to Replicate 3M’s Success in Energy Management?

To find out how well does your scores vis-a-vis energy management best practices and how much can your plant cut energy costs, we have developed an Energy Management Score™ assessment – a free online tool.

3M Canada scored 96% on EM Score™ and has reduced utility bills by 32% over 8 years. What is your score? Take a test at Energy Management Score™ Assessment. It takes only 15 minutes to find your score.

Succes in Energy Management graph

For more information please contact Anatoli Naoumov MBA, CMVP, GreenQ Partners, tel: 416.728.7239, email: anaoumov@greenq.ca or visit www.greenq.ca.

To read similar Energy Management articles visit https://www.airbestpractices.com/energy-manager/corporate-sustainability-programs.