Optimizing Energy Consumption For Effective Energy Management

WBSP072: Optimizing Your Facility’s Energy Consumption w/ Mike Nager

Energy consumption is a significant expense for manufacturers, often listed as one of the heaviest items on a profit and loss statement. While manufacturing executives are aware of energy costs, they frequently struggle to enforce energy-saving procedures effectively. The push for quality and productivity can unintentionally lead to decreased energy management and increased energy consumption. Therefore, to uncover cost-saving opportunities, a comprehensive approach that integrates energy costs into product costs and performance metrics is essential. Adopting Industry 4.0 technologies can also provide valuable historical data that can help in optimizing energy consumption and provide more savings. 

In this podcast, we explore the world of energy consumption and optimization with Mike Nager, an industry expert in industrial control systems. His valuable insights will shed more light on the organizational metrics and KPIs that often overlook the cost-saving opportunities available through effective energy control and policies.

Uncovering Hidden Energy Costs in Manufacturing

Energy is a major input for any manufacturing operation. Some industries are more energy-intensive than others, but all manufacturers use some level of energy. In North America, energy prices are generally lower than in other parts of the world, such as Europe. However, even in North America, there are opportunities to save money on energy costs. For instance, in discrete manufacturing, such as stamping, soldering, and plating, energy consumption remains high even during non-production periods. A startling discovery revealed that nearly 90% of the energy used during production hours was still consumed over the weekend when no production occurred. This insight shows how important it is to manage energy use carefully, even during downtime.

Best Practices For Reducing Energy Consumption

Here are some key strategies for businesses to significantly reduce their energy consumption, leading to cost savings and environmental benefits:

  • Implement Advanced Control Systems for Energy Savings

To combat excessive energy consumption during downtime, advanced controls for remote and scheduled operation of machinery are essential. For example, solder baths, which require substantial energy to maintain molten metal, can be scheduled to heat up only when production is imminent, rather than staying heated throughout weekends. This approach not only conserves energy but also operational efficiency challenges, traditionally measured by throughput rather than energy efficiency. Advanced control systems can be integrated with existing machinery for remote monitoring and adjustments, ensuring that energy usage aligns with production KPIs, and reducing waste.

  • Make Energy Efficiency a Measurable KPI

Incorporating energy consumption into key performance indicators promotes energy efficiency. By making energy management measurable and accountable, companies can foster proactive behavior among employees. Transparency and fairness in the system are crucial to ensure accurate and fair assessments. Establishing energy KPIs allows for regular monitoring and reporting, which can highlight areas where energy use can be optimized. By setting clear energy targets, companies can drive continuous improvement and engage all levels of the organization in energy-saving initiatives. This approach aligns energy efficiency with broader business goals, creating a culture of sustainability and accountability

  • Utilize Technology for Energy Monitoring

Historically, energy plants used a single electric meter for overall energy measurement, making it difficult to identify specific waste areas. Today, advancements in electric meters allow for monitoring individual equipment or machinery, providing detailed insights into energy usage. This granularity enables operators and engineers to identify and address high-energy-consuming processes effectively.

Additionally, integrating energy data into Manufacturing Execution Systems and Enterprise Resource Planning systems is crucial for comprehensive analysis, allowing manufacturers to combine scheduling data, maintenance records, and energy consumption patterns to identify cost-saving opportunities.

Adopting European Energy Efficiency Methods

European manufacturers, facing higher energy costs, have adopted rigorous energy management practices. Automated lighting and extensive use of skylights in buildings are common strategies to reduce energy usage. The higher return on investment for energy-saving initiatives in regions with elevated energy prices drives these practices.

The Role of Predictive Maintenance

Predictive maintenance, facilitated by sensors and meters, enables companies to schedule maintenance based on actual needs rather than a fixed schedule. Predictive maintenance systems use data from sensors to monitor the condition of equipment and predict when maintenance is needed. This reduces the risk of unexpected breakdowns and extends the life of machinery. By aligning maintenance schedules with actual equipment conditions, manufacturers can avoid unnecessary downtime and improve overall efficiency. This proactive approach to maintenance saves money and supports energy efficiency by ensuring that equipment operates optimally, reducing energy waste.

Enhancing Energy Management with AI and IoT

Advancements in artificial intelligence and the Internet of Things are revolutionizing energy management in manufacturing. AI can analyze energy consumption patterns and detect anomalies, such as a gradual increase in energy use indicating a filter needing replacement. IoT devices enable real-time monitoring and control of equipment, further enhancing energy efficiency.


Effective energy management extends beyond manufacturing to various industries, including retail and transportation. Leveraging advanced technologies, integrating energy data with MES and ERP systems, and adopting predictive maintenance practices enable substantial energy savings. These efforts contribute to environmental sustainability, which is increasingly important to consumers and regulatory bodies. Manufacturers must adopt a proactive approach to energy management, utilizing technology and integrating energy efficiency into core operations to remain competitive and sustainable in the long term.

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