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Cost benefit analysis of putting in a powder coat paint line at Everbrite, LLC

Cost benefit analysis of putting in a powder coat paint line at Everbrite, LLC

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Powder Coat Pp Powder Coat Pp Presentation Transcript

  • Case Study: Installation of New Powder Coat Paint Line Everbrite, LLC Pardeeville,WI By Derek Gates
  • Everbrite, LLC  A leading producer in indoor/outdoor electronic and neon advertising signs, menu boards, and scoreboards, etc.  Customers include McDonalds, Pizza Hut, Mobil gas station, DLK, and many more  Founded in 1927 in Milwaukee  Grown to about 1,200 employees in 11 different locations (5 in WI)
  • Project Description  Project focus: paint line process in the sheet metal section of the facility  Concerns  Quality of paint job  Environmental emissions  Employee exposure to chemicals/fumes
  • Current Sheet Metal Paint Process  Parts are prepared (manually sanded and wiped down) to help paint adhere to surface better  Parts are hung on a conveyor system  Parts go into paint booth via conveyor and are painted  Go into curing oven to bake and dry
  • Problem ID: Current Paint Process  Open-Ended Wet Spray Paint Booth  System was grandfathered in; old equipment, ventilation, etc.  Leads to inadequate paint jobs and poor air purity  Many parts are “defective”- need to be re- prepped and re-painted  Employees handle and are exposed to amounts of solvents, paint thinners, etc. which are hazardous  Majority of Haz. Waste of facility produced here
  • Picture of Spray Booth
  • Problem ID: Current Process (Production)  Shipping  Some parts need to be powder coated, so they are shipped out; leads to issues with quality and hinders productivity  Lost time on labor-handling, inspecting, and inventory on shipped parts  WIP Materials
  • Solution  Implement a new powder coating paint line  Will greatly reduce environmental safety concerns  Will increase quality of product, productivity, and lead to more business
  • Solution: Proposed New Powder Paint Line  Preparation-5-Stage Wash system  Parts treated with chemicals to enhance ability of paint to adhere to surface  Powder Paint Booth  Bake Oven  Parts moved via conveyor system
  • What is Powder Coating?  Applying dry paint to a surface  Paint powder is applied to the surface and put in an oven to bake  Results in a durable, even-coated finish  Preparation and baking are key to a good finish
  • Advantages of Powder Coating  Releases little to no VOCs and HAPs into environment (solvents, thinners)  Reduces employee exposure to these harmful chemicals  Reduces burden of EPA compliance for facilities  Overspray of powder is easily recyclable  Better paint quality  No drips, runs, or other imperfections  Reduces defected parts; less preparation time  Durable, Non-Corrosive Finish
  • Problem Solution: Air Emission Permit  Obtain a new air emission permit  Everbrite is currently under a Part 70 permit  Requires extensive reporting and not many advantages  Everbrite should obtain a Registration Operating Permit (ROP)
  • ROP Permit  Allows facilities to change processes/do construction without obtaining other expensive construction permits  Saves time and money  Must stay within limits of ROP during construction  Less extensive and less frequent reporting and recordkeeping than Part 70  Easy application process; short waiting time  Don’t need to hire consultant to handle permit  Costs less than Part 70  Doesn’t Expire
  • Emission Citations  Under Part 70- Automatically considered a High Priority Violation (HPV)  Forwarded to the EPA  Possibly referred to the Department of Justice
  • Emission Citations  Under ROP- not automatically HPV  Facility is sent a Letter of Notification (LON)  Facility replies on how to make sure the violation doesn’t re-occur  Follow up visit *Depends on violation for both Part 70 and ROP  ROP most likely less serious than Part 70
  • Expected Results/Benefits  VOC/HAP emissions will decrease  Less employee exposure  Less Hazardous waste produced  Less recording/reporting to EPA  Not as much administrative burden to keep records
  • Benefits  Reduction in:  Shipping costs  Labor Costs  Paint/Chemical Costs  Better employee morale due to working with new equipment  Better quality of product
  • Cost/Benefit Analysis for a New Dry Powder Coat Paint Line at Everbrite, LLC Annual costs with current paint system in place  Shipping out parts to be powder coated $717,886  Paint Chemicals  Solvents, Hardeners, Accelerators, Catalysts, Thinners $15,990.76  Preparation materials  sanding equipment, rags $6,558.29  Paint costs $26,386.84  Hazardous Waste Disposal $12,349.12  EPA Reporting $1,500  Labor Costs (Shipping Employees) $52,125 Total $832,796.01 Costs to implement new System  Paint System  5-Stage Wash System  Conveyor System  Curing oven  Stack Package (Ventilation)  Installation  TOTAL $580,000  Paint Booth/Accessories $73,058  2 additional full-time employees (Paint/Prep Workers)  $16.33/hr x 40 hrs/wk x 50 wks x 2 Workers $65,320  Cost of New Powder Paint (2/3 cost of Wet Paint) $17,679.18  Hazardous Waste Disposal $1,467.86  EPA Reporting  One-time $1,100 fee + $35.71 per ton emitted $1,308.81 Benefits  Savings (20% of annual costs above)  Shipping $143,577.20  Paint Chemicals $3,198.15  Preparation materials $1,311.66  Paint Costs $5,277.37  Labor Costs (Shipping Employees) $10,425 Total Benefits $902,623.23 NET SAVINGS FOR FIRST YEAR -$69,827.22
  • Cost/Benefit Analysis Over 5 Years Costs with current paint system in place over 5 years  Shipping out parts to be powder coated $3,589,430  Paint Chemicals  Solvents, Hardeners, Accelerators, Catalysts, Thinners $79,953.78  Preparation materials  sanding equipment, rags $32,791.45  Paint costs $131,934.20  Hazardous Waste Disposal $61,745.60  EPA Reporting $7,500  Labor Costs (Shipping) $260,625 Total $4,163,980.03 Costs to implement new System  Paint System  5-Stage Wash System  Conveyor System  Curing Oven  Stack Package (Ventilation)  Installation  TOTAL $580,000  Paint Booth/Accessories $73,058  2 additional full-time employees (Paint/Prep Workers)  $16.33/hr x 40 hrs/wk x 50 wks x 2 Workers x 5 yrs. $326,600  Cost of New Powder Paint (2/3 cost of Wet Paint) $88,395.90  Hazardous Waste Disposal $7,339.30  EPA Reporting $2,144.05 Benefits Over 5 Years  Savings (20% of costs above)  Shipping $717,886  Paint Chemicals $15,990.76  Preparation materials $6,558.29  Paint Costs $26,386.85  Labor Costs (Shipping Employees) $52,125 Total Benefits $1,896,484.14 LIFETIME NET SAVINGS (5 yrs.) $2,267,495.90
  • Cost vs. Benefits over 5-Year Period Cost Benefit $2,500,000.00 $2,267,495.90 $2,000,000.00 $1,500,000.00 Dollars $1,000,000.00 $832,796.01 $500,000.00 $0.00 -$500,000.00 1 2 3 4 5 6 Year
  • References  Larry Boehm, CHMM, Senior Environmental Specialist with AlphaTerra Science  Marge Erdman, Accounting/Plant Controller for Everbrite, LLC  Kelly Tomko, Freight Claim Coordinator/EPA Administrator for Everbrite, LLC  Daniel Guirl, President of G.A.T. Systems  Kristin Hart with the Wisconsin Department of Natural Resources  Darren Nosek with Dietz Supply Company  Registration Permits. Wisconsin Department of Natural Resources. 23 April 2009. Printed 17 June 2009. http://dnr.wi.gov/air/permits/streamlining/regpermits.html  Powder Coating Process. Nordson Corporation. 2009. Printed 6-17-2009. http://www.nordson.com/Businesses/Powder/WhyPowder/powdercoatingproce  Benefits of Powder Coating. Nordson Corporation. 2009. Printed 6-17-2009. http://www.nordson.com/Businesses/Powder/WhyPowder/benefitsofpow dercoating.htm