Workshop J Advancing Energy Management at the Plant Level and Best Practices in Energy Reduction

Transcription

1 Workshop J Advancing Energy Management at the Plant Level and Best Practices in Energy Reduction Tuesday, February 19, :45 p.m. to 3 p.m.

2 Biographical Information Timothy W. Ling, P.E. Corporate Environmental Director Plaskolite, LLC. P.O. Box 1497, Columbus, OH (614) Mr. Ling is the Corporate Environmental Director for Plaskolite, LLC., a Columbusbased manufacturer of continuously processed plastic sheet. Mr. Ling is responsible for Plaskolite s environmental compliance at its 10 manufacturing facilities in Ohio, California, Texas, Mississippi, Tennessee, New Jersey, Massachusetts and Mexico. He has over 28 years of experience in environmental engineering, both as a consultant to businesses, and now as in-house environmental manager. He has spoken and written on a wide range of environmental and energy management topics. Mr. Ling graduated at the top of his class with a Bachelor of Science degree in Civil Engineering from the Florida Institute of Technology (1989). He also holds a Master of Science degree in Civil Engineering from the University of Notre Dame (1991). He is a Registered Professional Engineer in the states of Ohio and Florida. Anthony J. Smith, P.E. Global Energy Coordinator Cooper Tire and Rubber Company 701 Lima Avenue, Findlay, OH (419) ajsmith1@coopertire.com Mr. Smith leads energy savings initiatives as the Global Energy Coordinator for Cooper Tire facilities around the world. Cooper Tire was founded over 100 years ago in Ohio and is headquartered in Findlay, Ohio with manufacturing plants in the USA, Mexico, England, Serbia, and China. Prior to taking his current role, he served as energy coordinator for the Findlay Ohio tire production facilities. Trained and certified as a Lean Six Sigma Black Belt, Mr. Smith uses the Six Sigma tools to lead cross-functional teams to solve energy efficiency problems, and has developed energy regression models for tracking and forecasting utility usages. He has authored numerous newsletter articles on energy topics and is also a frequent panelist and speaker on industrial energy efficiency. Mr. Smith holds a Bachelor of Science degree in Mechanical Engineering from the University of Dayton (2004). He is a registered Professional Engineer in the State of Ohio.

3 1 Advancing Energy Management At The Plant Level & Best Practices in Energy Reduction Timothy W. Ling, P.E. Corp. Environmental Director Plaskolite, LLC. Anthony J. Smith, P.E. Global Energy Coordinator Cooper Tire and Rubber Company

4 2 Plaskolite, LLC Plastic sheets & pellets Doubled in size in plants

5 Utilities Costs 3

6 4 Cooper Tires 100+ year history 13th largest globally & 5th largest in U.S. (based on sales) Eight tire manufacturing plants worldwide including Findlay, OH Intense focus on energy since 2007

7 Cooper Tire Brands 5 The Cooper brand is the company s flagship brand and offers a full line of great performing tires. The Mastercraft brand is well-known for its quality and outstanding value. Avon Tyres is one of Europe s leading tire brands and offers a complete product range for cars, motorbikes, vans and trailers. The Roadmaster brand has commercial truck tires for every application. The Starfire brand is dedicated to providing value at a reasonable price without sacrificing quality or performance. Mickey Thompson offers specialized racing, off-road and high-performance tires. Dick Cepek brand provides quality on and off-road products. A popular truck tire brand in Asia, the Dean brand is designed and engineered to meet the demanding performance requirements of fleets.

8 CSR AND SUSTAINABILITY REPORT Cooper produces an annual Corporate Social Responsibility (CSR) and Sustainability Report The report, which was published in July 2018, covers primarily 2017 performance and activities, and marks the sixth annual CSR report for Cooper It is available at coopertire.com

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11 9 Living In The Energy Space Since 2009 Utility metrics Energy efficiency almost routine BUT

12 10 Why Is My Electric Bill Still HIGH?

13 11 Here s The Problem % Total Bill Distribution+ Transmission 20% 40% Generation 80% 60%

14 12 The Problem $$/KWH costs (2001 vs. 2016) Overall increased 81% Generation increased 47% Distribution increased 223%!! Distribution cost consists of: KW demand charge (~20%) Riders & subsidies (~55%) Transmission costs (~25%)

15 13 Distribution Is Monopoly Non-bypassable cost Not transparent as to rate design Highly affected by PUCO actions

16 14 Rider & Subsidy Increases 55% of distribution, PUCO-approved Riders through ESP Subsidies through unique/ reasonable arrangements You re paying for another s electricity!

17 15 Electric Security Plan (ESP) Original intent (SB 221 in 2008) as a bridge mechanism to a fully deregulated market Since May 2015, Ohio is a fully deregulated market BUT

18 16 ESPs Here To Stay At least to 2024 and beyond?! Not as accountable (vs. rate case) Don t need to use rider for its intended purpose We re paying for inefficient power plants (OVEC) that aren t needed

19 17 But WAIT There s MORE

20 18 Losing for Winning KIKO precedent at Ohio Supreme Court Refunds due to improper rates are considered retroactive ratemaking under KIKO Utilities are not obligated to refund the improperly collected money

21 But WAIT 19 There s EVEN MORE

22 20 Transmission Costs 25%-50% of distribution charges and assessed by PJM Compensate transmission owners for upgrades 2 classes of upgrades: Baseline/Network PJM ordered Supplemental - proposed by individual transmission owners

23 21 Another Transmission Cost Increase NO rigorous review or oversight at PJM, PUCO or FERC Proliferation of supplemental transmission projects Gold-plating of these transmission projects

24 22 Another Transmission Cost Increase Cost switched from CRES portion to utility portion of bill - loss of market accountability Susceptible to rate modification AEP modified 1 CP to monthly 30-minute peak KW & total monthly KWH

25 23 49% increase in GS4 Transmission charge Reduced KW rate filed for April 2019

26 Supplemental transmission 24 projects exceeded PJM requested baseline projects for the last 5 year period!!! $ in millions

27 25 BTCR Pilot Program AEP & First Energy pilot programs Billing of transmission cost based on customer s 1 CP KW contribution but, at a higher rate Which is better: 1 yearly peak or monthly 30-minute peaks?

28 26 AEP KW Billing Demand Back to the Future! 30-minute KW demand now more important with AEP billing shift from KWH to KW 30-minute demand charges will exceed PJM capacity charge from CRES suppliers in 2019

29 AEP GS4 Subtransmission OAD Billing Riders Universal Service Fund (first 833,000 kwh) kwh /kwh Universal Service Fund (in excess of 833,000 kwh) kwh /kwh Power Purchase Agreement Rider kwh /kwh Basic Transmission Cost Rider (kwh) kwh /kwh Basic Transmission Cost Rider (kw) kw 5.03 /kw Energy Efficiency and Peak Demand Reduction Cost Recovery kwh /kwh Energy Efficiency and Peak Demand Reduction Cost Recovery kw 0.89 Retail Stability Rider (first 833,000 kwh) kwh /kwh Retail Stability Rider (in excess of 833,000 kwh) kwh /kwh Phase In Recovery Rider kwh /kwh Tax Savings Credit Rider kwh /kwh KW demand charges are 60% of the AEP monthly bill for a GS-4 customer using 9,000,000 KWH and 15,000 KW monthly demand

30 28 Page 122 of AEP Ohio tariff sheet (for GS-4): Billing demand in KW shall be taken each month as the single highest 30-minute integrated peak in KW as registered during the month by a 30-minute integrating demand meter, or indicator, or at the Company's option, as the highest registration of a thermal-type demand meter. The monthly billing demand established hereunder shall not be less than 60% of the greater of (a) the customer s contract capacity, or (b) the customer s highest previously established monthly billing demand during the past 11 months, nor less than 8,000 KW. If a plant makes a KW demand reduction in a month below 8,000 KW, the minimum demand clause takes effect!

31 29 What Can You Do? Be concerned about PUCO actions on your energy costs Try to make PUCO more accountable to Ohio citizens, not just to utilities Don t shift your costs to others, through frivolous subsidies

32 30 What Can You Do? Participate in BTCR pilot program - IF your KW during your PJM grid zone 1 CP is significantly less (20-35%) than your monthly peak KW Reduce your KW load through energy efficiency projects - KW is more important than KWH

33 31 What Can You Do? Advocate for more oversight of supplemental transmission projects Participate in trade groups that advocate for Ohio ratepayers Support free market legislation

34 32 HB 247 (Romanchuk) Customer refunds if charges declared illegal by courts Utilities to go through a distribution rate case to set rates Full ownership separation of electric generation plants from distribution utility

35 33 HB 247 (Romanchuk) Broad-based support (AARP, NFIB, OMA, Ohio Farm Bureau) But, utilities against it Many hearings in 2018, but stalled

36 34 Combined Heat and Power (CHP)

37 35 CHP Technologies Natural Gas Turbines Natural Gas Microturbines Steam Turbines Reciprocating Engines

38 36 Steps To Implementing CHP High level screening analysis Investment grade engineering study Final engineering design Project funding

39 37 CHP Tips Engage management EARLY!!! Look beyond energy savings for additional savings opportunities Boiler replacement or other infrastructure upgrades can increase justification for CHP

40 38 CHP Equipment Solar Taurus 70 natural gas-fired turbine (6.8 MW nominal) Rentech Heat Recovery Steam Generator (80,000 PPH) Vilter natural gas compressor

41 CHP 39

42 40 CHP Project Considerations Sized for 100% of thermal load (steam capacity of the plant) Turbine generator will provide 50-60% of the plant electricity capacity

43 41 CHP Project Considerations AEP offers energy efficiency rebate Federal tax credit reinstated (10%) Project payback just under 5 years vs. cost for a new boiler only Beware of KW versus KWH charges

44 42 CHP Project Schedule Investment-grade engineering study (2015) Final Engineering/Project Approval (2016) Equipment set in 2Q 2018 Commissioning in 4Q 2018

45 43 Trend: Lighting Circa 2009: LED not cost effective & light levels not there yet 2019: LED are cost effective, at adequate light levels Wholesale switch to LEDs Edgelighting vs. backlighting

46 44 Trend: Behind-the-Meter Don t draw electricity from grid = avoid utility charges Interconnection to grid is still a major consideration Need to keep utility from getting behind-the-meter

47 45 Trend: Behind-the-Meter Non-generation Energy efficiency Demand response On-site Generation CHP Battery Renewables (Wind & Solar)

48 46 Tip Of The Day DON T SWEAT THE STUFF YOU CAN T CONTROL SWEAT THE STUFF THAT YOU CAN CONTROL!!!

49 47 Final Thoughts Want to be fair, but this has been exploited by utilities (e.g., ESP) Not just energy efficiency, but also energy advocacy Think of other Ohio ratepayers

50 48 Final Thoughts HIGH cost of public policy, with more coming into distribution side Consider behind-the-meter projects, including on-site generation

51 49 Final Thoughts Increasing electrical costs challenge your plant competitiveness with other sites around the world Calculate the costs to ALL of your operations before sticking with the status quo of rate & rider increases

52 50 Final Thoughts Be PUCO, Legislature & PJM Reduce your load to avoid KW- & KWH-based charges & riders (e.g., LED lighting, CHP)

53 Burning Questions 51