1) Tefen is an international management consulting firm that aims to improve organizational performance and competitiveness for its clients.
2) The document discusses achieving energy efficiency (E3) at a petrochemical site with little or no capital expenditures. It emphasizes focusing on behavioral and maintenance issues rather than just technical upgrades to find quick savings.
3) Tefen's approach involved broadly engaging the organization to identify efficiency opportunities, pursuing both immediate no-cost initiatives and low-cost investments, and designing cultural and process changes for continuous improvement. This allowed over €1 million in annual recurring benefits to be achieved within 4 months.
1. S t r a t e g y O r g a n i za t i o n a l D e ve l op m e ntO p e r a t i o ns E xc e l le n c e P ro j e c t Ma n a g e m e n t
Achieving Energy Efficiency
at little (or no) capex
Key lessons learned from a
real project experience
Green Forum 2010
London, October the 4th
, 2010
2. Workshop Agenda
2
• Introduction to Tefen and to Energy Efficiency Excellence
(E3
) key concepts
• Key Lesson learned to achieve E3
in a petrochemical site,
based on Tefen experience
3. Tefen: who we are
3
Tefen is an international management consulting firm
Founded in 1982, the company has amassed a reputation for improving and enhancing
performance excellence in some of the world's largest and fastest growing companies
From strategy through implementation, we create value by optimizing the competitiveness,
innovation and agility of our customers at every stage of a firm’s life cycle
Our innovative hands-on approach has achieved success in delivering quantifiable and value-
driven results
Our worldwide offices:
London
New York
Milan
Munich
Bucharest
San Francisco
Tel Aviv
Washington, D.C.
Warsaw
Our mission: to create value by making our customers competitive, innovative and agileOur mission: to create value by making our customers competitive, innovative and agileOur mission: to create value by making our customers competitive, innovative and agileOur mission: to create value by making our customers competitive, innovative and agile
4. Tefen : What we do in the Oil & Energy industry
4
• M&A advisory
o Asset evaluation and transaction support
o Business model design
o Economic modeling of key strategic alternatives
• VBM (Value Based Management)
o KPI system development
o MBO framework and incentive packages design
• Risk Management system design
• M&A advisory
o Asset evaluation and transaction support
o Business model design
o Economic modeling of key strategic alternatives
• VBM (Value Based Management)
o KPI system development
o MBO framework and incentive packages design
• Risk Management system design
Corporate issues
We support our partners in
undertaking strategic decisions
blending analytical precision
with innovative insights and
approaches…
We support our partners in
undertaking strategic decisions
blending analytical precision
with innovative insights and
approaches…
Assets People
• ZBC (Zero Based Costing)
• Standardizing oil stations
development processes
• Optimizing & monitoring labor
costs
• Maintenance productivity
• Coordination and Program
Management
• HR processes optimization
• Scheduling of field workforce
(e.g. field technicians)
• Purchasing optimization programs
• Large scale & Step-Change improvement programs
Operations excellence
… radically improving
operational performance
to achieve sustainable
standards of excellence
… radically improving
operational performance
to achieve sustainable
standards of excellence
• Analytical insights to support business decisions
o Analytical models to support strategic multi-year plans
o Evaluation to support complex business decisions (e.g. modeling options
of long-term supply contract)
o Detailed sensitivity analysis on macro-economic scenarios
• Sales & Marketing Strategy
o Competitive analysis and positioning
o Sales and distribution: organization and strategy
o Brand strategy design , branding strategy optimization, brand positioning
and restyling for oil stations
networks
• Analytical insights to support business decisions
o Analytical models to support strategic multi-year plans
o Evaluation to support complex business decisions (e.g. modeling options
of long-term supply contract)
o Detailed sensitivity analysis on macro-economic scenarios
• Sales & Marketing Strategy
o Competitive analysis and positioning
o Sales and distribution: organization and strategy
o Brand strategy design , branding strategy optimization, brand positioning
and restyling for oil stations
networks
Business Strategy
… fine-tuning the
details of business
strategies to extract
the maximum
value…
… fine-tuning the
details of business
strategies to extract
the maximum
value…
Sustainable value creationSustainable value creation
5. Energy Efficiency Excellence (E3
) isn’t an option…
5
The energy consumption in Petrochemical sites
usually accounts for roughly 40-50% of cash
operating costs
The energy related issues in petrochemical sites is
growing due to market and regulatory pressure
Energy Efficiency Excellence (E3
) must be a primary
value creation – and environmental sustainability –
lever for Petrochemical operators
… and must be conceived as a strategic and fundamental challenge
by the whole organization
6. A “little capex” approach is possible to achieve E3
6
“Baseline consumption levels”“Baseline consumption levels”
InefficienciesInefficiencies
Actual consumption level
Levers and approaches for Energy Efficiency Excellence (E3
)
• Need for significant capex, especially
for major upgrading / replacement
initiatives
• Deferral of expected benefits after
the completion of implementation
• Most of the baseline already targeted
• Need for significant capex, especially
for major upgrading / replacement
initiatives
• Deferral of expected benefits after
the completion of implementation
• Most of the baseline already targeted
• A cost-effective way to identify and
implement quick-win with an immediate
impact
• Most of these opportunities are usually
unexplored and latent in organization
• Achieving tangible improvements on
EBIT with minimal investment
• Unlocking of long-term sustainability
• A cost-effective way to identify and
implement quick-win with an immediate
impact
• Most of these opportunities are usually
unexplored and latent in organization
• Achieving tangible improvements on
EBIT with minimal investment
• Unlocking of long-term sustainability
Technical approach
Focus on major
assets upgrading /
capex to reduce the
“baseline”
Technical levers
No intervention on
people
Purely a technology
and “hardware” issue
Managerial approach
Root cause analysis of
existing inefficiencies
Search for behavioral and
maintenance levers to
stick consumption to the
“baseline minimum”
Focus on long term
sustainability through
culture change
7. Key concept is to have a balanced perspective …
77
Key levers
Early fixes of steam losses
Development of E3
compliant approaches /
procedures
Identification and
elimination of maintenance
“bad actors”
Goals and KPIs definition
Key levers
Early fixes of steam losses
Development of E3
compliant approaches /
procedures
Identification and
elimination of maintenance
“bad actors”
Goals and KPIs definition
Maintenance
dimension
Key levers
Creation of a non-itemized
dedicated budget to speed
up approval and execution
Acceleration of less
complex investments with
good ROI
Identification of a single
focal point for investments
execution
Key levers
Creation of a non-itemized
dedicated budget to speed
up approval and execution
Acceleration of less
complex investments with
good ROI
Identification of a single
focal point for investments
execution
Key levers
Strengthening of operator
care energy consumption
parameters monitoring in
routine walks
Structured organizational
presidium (processes, roles)
Review of job descriptions
Review and strengthening of
individual objectives
Field personnel training
Key levers
Strengthening of operator
care energy consumption
parameters monitoring in
routine walks
Structured organizational
presidium (processes, roles)
Review of job descriptions
Review and strengthening of
individual objectives
Field personnel training
Organizational
and behavioral
dimension
Focused
investments
dimension
Focus on “hardware”Focus on operational dynamics
… considering short & medium term issues across organizational &
behavioral and Maintenance & Investments management dimensions
8. We’ll share our key lessons from real experience
88
A refinery operator, aimed at enhancing its energy efficiency to
reach the boundary between 1st
and 2nd
quartile.
Background
Project goals
A 5% - 10% of saving over the refinery energy cost base.
More than € 1 million of yearly recurring benefits achieved through
quick hit in less than 4 months.
Around 30% of savings coming from no-capex initiatives, other 40%
coming from small investments (€0,5-1 mln), with payback within 1 or
2 years.
Overall mobilization of the organization towards E3
issues.
Identify and execute immediately all no-capex initiatives that could
improve energy efficiency.
Design a medium/long-term Energy Efficiency Excellence Strategy
and realistic execution plan.
Significantly improve Ell Solomon quartile refinery positioning.
Results
9. An enlarged participation is key to achieve E3
Energy Efficiency is a deeply cross – functional issue
involving a multiplicity of referents within a refinery
Enlarged involvement, both vertical and horizontal, is
needed
Involvement of all Departments with directly or indirectly impact on energy
efficiency
Focus on field personnel
Utilization of an effective mix of tools, to facilitate
participation and contribution from all stakeholders, is key
“Energy fairs”, brainstorming and communication sessions to build and
strengthen the momentum for change
Group workshops, to analyze cross – functional issues
Individual interviews to identify, analyze in depth, quantify and validate
improvement opportunities
10. Change is to be ignited and continuously steered …
An interactive approach is
used to map optimization
areas, mobilizing the
organization …
… an analytical focus is
needed to select best
options. Quick-hits are
launched to achieve
immediate results
... managerial and organizational
aspects are developed to ensure
a continuous improvement
process…
… a consistent
roadmap is designed
to support the project
implementation phase
in the medium-long
term
Tefen’s Managerial Approach
Perdite di vapore
Organizzativi culturale
Ottimizzazione energetica nella
gestione impianti
Non considerare i
problemicome
proprima c ome di
qualcun altro
Carenza di
personale (tech,
man,ese)
Gestione delle
emergenze/urgenze
sia operativa sia
manutentiva)
Assenza finora di riunioni
di coordinamento
tecnologica e
multifunzionale
Sfruttamento limitato
delle figure già preposte
all’ottimizzazione
energetica
Focus operativo
(organizzazione)
principalmente su
rese e prodotti
Mancata
attenzione ai
dettagli
Non adeguata
comunicazione
interfunzionale
Sfruttamento limitato
delle figure già
preposte
all’ottimizzazione
energetica
Strumentazione di
base tenuta
valvole
Perdite vapore +
cort…..xxxx
Rifacimento/sostituzi
one linee vapore
ditracciamento
Ritardate
eliminazioni
perdite di vapore
Eliminazioni linee di
trac ciamento previo utilizzo
materiali isolanti ad alto
coefficiente isolamento
Ritardate manovre
operative sui forni Mancanza target di
riferimento specifici
Gestione non
ottimale delle
variabili di
processo
Analizzatoriin
linea/inferenziali
Mancanz a o
staratura
strumentazione
utilities
Gestione
combus tibili
Motorielettrici
sovradimensiona
ti
Funzionalità
strumentazione
Serrande aria ai forni
meglio gestibili
Cattivo controllo
eccesso di ossigeno
nei forni
Controllo
combustione
+<funz bruciatori
Pompe in marci con
prevalenza
superiore al
necess ario
Inverter per motori +
ventole
Parzializ zazione
portate macchine
rotanti
Designed managerial and organizational levers
Identifiedorganizationandprocesscriticalities
IMDN07 - Topping plant
burne rsreplacement
MD N03- Adjusting
flowcompressors
IMDN02 - Lighting systems
energy c onsumption
optimiza tion
Management of energy
efficiency equipment
Steam loss and condensate
recovery
Thermalintegration
Optimizing energy management systems
Power plant optimizationHeat loss
Steam
consumption
optimization
FOE consumption
optimization
QH N04- Installazione
rapportatoridi vaporeU1000
QH E05- Optimizing with
automatic oxygen/ draft
furnaces re gulation-step1
QHE07- PA plant optimization
QHE06 - Pre ssure and
te mperature opt imization
QH E08– Opt imizing plant
automatic control
IMD E02 - C O2 analy zer installation
in plant furnaces
IMDQ0 7- Fuel ga s loss
elimination
QH N03- Optimizing with automatic
oxygen/ draft furnaces regulation
IMDN08- Installing doors
forc leaning ovens
IMDQ02- Optimizing with
automatic oxygen/draft furnace s
re gulation– step3
QHN01 - Optimizing with
automatic oxyge n/ draft
furnaces regulation-step2
QH E02- Stripping steam
consumption opt imization
QHE03- Stripping ste am
cons umption optimization
Topping pla nt
QH E04– Ste amconsumption
optimization and Amine
Re generation pla nt4
QHE09- Side stripper steam
c onsumption optimiza tion
Topping plant
QHN02– Steamconsumption
optimizat ion in amine
regenera tion process
IMD Q0 8- Replac ing the control
ins trumentation of the plant s team
stripper
QHN05- Steamc onsumption
optimization plant6
IMDN09 - Residuetherma l
balance of toppingplant
IMD E0 5– ReduceFOE
consumption topping plant3
IMDE06- R educe
FOEconsumption
de sulphurisationoil plant 2
IMDE01- R educt ion
FOE consumption
plant 1
IMDQ05 - Improving
integration the rmal plants
IMDN06- Repla cementof
condensa tedra ins-
step2
IMD E03- Re placement of
1000conde nsate drains
IMDE04- Rev amping LS
steamc ircuit s torage fuel
Oil plant
IMDQ06- Reva mping
basic ins trumentation
IMDQ03 - Verifyhe atingneed
f or lines and ta nks andsteam
networksrationa lization
IMDN0 5- R eplacementof
condensatedra ins
IMD E07– Inverterinstallation on
cha rge pump Topping plant
IMDN04– Inverterinsta llation
onpumps ov ersizedele ctric
engine
QHN06– Plant factor
c orrection
IMDN01– HSst eam-
rolling optimization
proc ess
IMDN10- A ir temperature
cooling with f ogging syste m
IMDQ04– Insula tion
improvement with bet ter the rmal
insulation coefficient material
ILPE0 1– Self steam produc tion
ILPE04 – Rankinemini
cycle res idualc ircuit
ILPE 06-
Turboexpander
ILPE07 – Prefla shpillars
insta llation
ILPE08- Lighting
ins tallations consumption
reduction
ILPE02- Prehea tersair
furnace pla nt3
ILPE05 - “Pinch Technology”
application
ILPE03Improving
efficiency and heat
insula tion
QHE01- Steamconsumption
optimization and Amine
Regeneration plant5
Illustrative
Illustrative
illustrative
illustrative
illustrative
illustrative
illustrative
illustrative
… managing a structured approach that balances a creative and
mobilizing approach with sound and solid analytical methods
11. Consider “hardware”, but focus on soft causes …
11
Opportunity map for Energy Efficiency Excellence (E3
) in a refinery
Quick Hits Small / quick-pay-back investments Long-term / large investments
Illustrative
Illustrative
EE33
… balancing a creative and mobilizing approach with sound and
solid analytical methods
Plant 5 burner
substitution
Regulation of
compressors’ flows
Optimization of
illumination systems
consumption
Management of
equipments energy
efficiency
Steam losses and
condense recovery
Thermal
integration
Energy optimization in plant management
Power Plant
Consumption
optimization
Heat losses
Steam
consumption
optimization
FOE
consumption
optimization
Installation of steam
ratios regulators
Optimization of
furnaces oxygen /
draught ( 1nd
step)
Plants PA optimization
Pressure an d
temperature
optimization
Plan automatic control
optimization
Installation in the furnace
of CO / O2 analyzers
Elimination of fuel losses
through torch
Optimization of furnaces
oxygen / draught (2 nd
step)
Installation of
additional doors to
clean furnaces
Optimization of furnaces
oxygen / draught through
automated regulation
Optimization of furnaces
oxygen / draught ( 2nd
step)
Plant 7 Stripper and side
strippers steam consumption
optimization
Plant 6 stripper steam
consumption
optimization
Plants 9-10 steam consumption
optimization
Plant 12 side stripper steam
consumption optimization
Steam consumption
optimization in the amina
regeneration process
Plant 14 metering
instrumentation
substitution
Plant 13 steam consumption
optimization
Thermal balance of
topping residual
Plant 3 FOE
consumption reduction
Plant 2 FOEE
consumption
reduction
Plant FOE
Consumption
reduction
Pant thermal integration
improvement
Substitution of
condense drains
(2nd step)
Substitution of 1000
condense drains
Fuel oil system LS
circuit revamping
Basic
instrumentation
revamping
Rationalization of the
consumption on the
entire steam system
Substitution of
condense drains
Installation of expanders on
over -dimensioned pumps
Installation of inverters
on over -dimensioned
pumps motors
Plant 4 factor
collection
HS rolling
process
optimization
Inlet Air in GT cooling
through fogging
system
Insulation enhancement
with the use of new
materials with higher
insulation coefficient
Steam auto -production
Ranking mini
cycle Topping
residue circuit
Turboexpander
Plant 6
Installation of preflash
columns
Reduction of consumption
of the illumination
systems
Furnace air preheater
Application of the
“Pinch Technology”
Improvement of
the efficiency of
thermal insulation
Plant 11 steam consumption
optimization
12. Focus on all areas that contribute to E3
losses
12
Improvement areas Examples of opportunities
Steam New approach to the measurement and maintenance of lines of steam
Improved steam and condensate demi water recovery
Automatically set steam quantities proportional to fluids
Pumps, engines,
illumination
system
Effective air coolers preventive maintenance
Ensure pumps and compressors absorption proportional to flows
Improvement efficiency illumination technologies
Utilities
production and
consumption
Solve inefficiency and / or losses in the production/utilization of utilities
Installation of fogging system to reduce power consumption in summer months
Use of steam when temperature cools down (Demi water)
Optimization of the water energy potential used in refinery
Furnaces and
burners
Critical review of target oxygen percentage in furnaces
Reduction of excess hydrogen in the burner
Increase frequency of burner cleaning
Substitution of Fuel Oil burners with Fuel Gas ones (optimization of consumption)
Heat Assessment of thermal insulation
Reconfiguration of the pre-heating circuits to optimize energy consumption
Reconfiguration of the use of fuel, isolate liquids from hydrocarbon to reduce the final
consumption
Processes and
procedures
Missing targets for consumption
Improvement in the allocation of human resources & in reporting and monitoring
systems
Partial list
extracted from
Tefen database
Partial list
extracted from
Tefen database
13. Leverage on immediate or fast payback initiatives
13
• Quick Hits are usually
implementable in 1-2
months
• Small & fast payback
investments are
implementable within
preventive maintenance
or during small
slowdowns
• Large investment are
usually the ones
included in long term
strategic revamping
initiatives
14. Transform quick wins into long term performance
1/2
14
First implementation of Quick-hits obtained quick response on predicted targets
After a short period of time it was registered a tendency to go to previous poor performance
The new organizational model (structures, processes, measurements), put quick hits back on track
and even further improved performance
t1 t2
Illustrative
Illustrative
Quick wins can be implemented rapidly --
… but need to be translated into long term performance through people and
process levers
Stripping
steam
consumption
optimization
15. 15
First implementation of Quick-hits significantly reduced level and variance of % oxygen
After a period of time a new procedure, training and monitoring system was put in place
The new system overachieved performance targets both in level and variance of oxygen in the
furnaces
Quick wins can be implemented rapidly…
… but need to be translated into long term performance through people and
process levers
Transform quick wins into long term performance
2/2
Oxygen %
optimization in
combustion
chambers
16. Manage E3
barriers across your organization
16
Areas of
improvement
Examples of common barriers
Corporate
culture
Energy inefficiencies not seen like costs
No focus on the soft issues related to the energy performance
Lack of trainings and communication campaigns on the matter
KPI system with weak incentives
Organizational
and managerial
issues
Poor accountability on energy performance
Lack of a reference point for energy conservation issues
Lack of systematic root causes analysis & monitoring of energy
consumption
Lack of clear incentives
Maintenance
Management
Lack of focus on the day-by-day activities of most operative human
resources
Non-effective procedures to tackle maintenance inefficiencies
Lack of common maintenance procedures “designed for E3
”
Investments
management
Lack of clear focus on energy conservation investments
Excessive complexity for smaller and short payback investments
Lack of structured procedures for major E3
investments
Partial list
extracted from
Tefen database
Partial list
extracted from
Tefen database
17. Improve, but don’t jeopardize your organization
17
Creation of a new Department fully
dedicated to Energy Conservation
For each site or centralized for all sites
360° coverage of matters related to
energy performance (e.g. procedures,
operations, investments, etc.)
Clear objectives for the dedicated
department as well as for all other
existing Functions
Breakthrough solution to create
immediate awareness
Strong commitment from top
management
High ROI expected
Responsibility for energy efficiency
is given to already existing
Functions
For example, Area Technology for the
more operative side of the project
Creation of a new role with E3
managerial responsibility
Coordination activity for all production
sites
Reporting directly to top management
It is the best solution in cases were
the starting point is already
acceptable
only a continuous improvement process
is needed
Radical boost –
Centralized model
Ongoing improvement -
Shared responsibility model
18. Measure hard and soft dimensions of E3
...
18
KPIs are divided into three main
categories, all three are important
Organizational and procedural
dimension
Technical and operational performance
Individual and Function-level targets
Clear targets should be set coherently
with the area they need to measure
Managerial roles: targets linked to the
overall energy performance (e.g.
reduction of the energy consumption,
reduction of energy expenses, etc.)
Operative roles: targets tailored on
their job description (e.g. cut of the
steam consumption for each shift, cut of
combustion gases) to increase positive
competition
Organizational and
procedural KPIs
Theymonitor the effectiveness of
the process and mechanisms of
coordination put in place to
optimize the energy performance
Technical and operational
KPIs
Theymonitor the energy
performance in theproduction
processes vs. technical and
operational targets
Individual /Functional-
level KPIs
Theymonitor the individual and
function-level targets for the
optimization of the energy
performance
Executive
synthesis
Solomon Ell
indicators
Synthesis of all
key indicators
… to monitor progress, steer the implementation and reinforce the
change of focus
19. And now... Where is your organization standing?
1. Are you addressing E3
as a strategic challenge or is somewhat an option for you?
2. Are you addressing little or no-capex initiatives to achieve E3
? Do you even think is it
possible in your organization?
3. Do you have a balance perspective? Are you considering short and medium term
issues across organizational, behavioral, maintenance and investments management
practices to achieve E3
?
4. Are you fostering an enlarged participation across all key actors in your site?
5. Are you comprehensively and periodically mapping all possible root-causes for Energy
Efficiency losses, both hard & soft, short & medium term?
6. Are you leveraging on quick hits and fast payback initiatives?
7. Is your organization capable to transform quick wins in sustainable performance?
8. Are you managing all potential barriers to E3
in your organization?
9. Are you capable to improve your organization E3
readiness without jeopardize it? (i.e
raising costs, defocus from process)?
10. Do you have an organizational-wide shared commitment and vision towards E3
in your
organization?
20. w w w . t e f e n . c o m
S t r a t e g y O p e r a t i on s E xc e l le n c e P r o j e c t Ma na g em e n t O r g a n i za t i o n a l D e ve l o p m e n t
Contact:
Fabio Nicolò – Partner
Mail: fnicolo@tefen.com
Mobile: +39 340 3331807
Via Privata Maria Teresa, 8
20123 Milano
Tel: +39 02 36572150
Fax: +39 02 36572176
Editor's Notes
Good morning to everybody!
..I am Fabio Nicolò, partner of Tefen and responsible for the energy practice in Europe…
Let me tell you the way we would spend the next half hour
… a Brief introduction
…. Some of our key lessons learned to Achieve Energy Efficiency Excellence (that we call E3)
Tefen is an international management firm…many offices around the world
…since 1982…with some of the world largest and fastest growing companies
…our services span from strategy to execution
..we are characterized by an hands on approach…
Partnering with clients from very senior consultant all the way to the most junior ones…
By the way… This is our second year as sponsor for this event
We have an extensive experience in the Oil & Energy industry
We focus on create sustainable value for our client…
…from strategic innovation….
…to operation excellence programs…
… and now let’s go into the subject of the workshop
We would like to start with few general statement we think important as…key ingredient for your …food for thought..!
….
Then we will present you some of the key lessons learned and results from a real and recent case.
First…
Energy Efficiency Excellence…E3..is NOT an option!!!.....
….and must be conceived ad a strategic..fundamental…challenge by the whole organization!!!
Since…as far as our experience…making organization truly embrace this priority vertically and horizontally…IS quite a Challenge!!!
..and this is the primary challenge for the industry senior executives…about you….
…A “little capex” approach is possible to achieve E3…!!!
E3 has fundamentally two drivers…baseline consumption levels…and…inefficiencies..
If you focus on the first…you concentrate on major assets upgrading…technical levers..no intervention in people
When you focus on the second….you concentrate on the root-cause analysis of the existing efficiencies…..focus on behavioral and maintenance levers…
….you basically focus on long term sustainability through a cultural & managerial shift
The first approach is conceptually easy..but economically and financially hard to pursue…especially in these times…
The second is a bit more difficult..but more cost effective and long lasting…and it can foster significant EBIT improvements!!
…so..in this context the key concept is to have a balanced perspective…
…considering short & medium term issues…across organizational; Maintenance and investments management practices
Strengthening of operator care energy consumption parameter monitoring…
Early fixes of steam losses
…creation of non-itemized dedicated budget to speed up approval and execution…
E3 investments need to be managed differently ..different criteria..different time constraints.. Capex dimensions (can be small)…and almost counter intuitively…usually faster paybacks
…Now we would like to share with you some key … concise … lessons learned from our experience….
…due to time constraints I will not articulate in details…
I would like more to give you some concise flash statements…
Food for thought ingredients…to ignite the following discussion….
We will use one of our several project in this area…
..we worked for a large refinery operator.. .to help them achieve E3 in the fastest and most sustainable way…
..
Project yielded 5-10% saving over their energy cost base…
1 milion euro on a yearly base, from quick hits action completed in 4 months
30% saving coming from no or little capex initiatives (the last ones with fast paybacks…
An enlarged participation is key to achieve E3!!!...
E3 id determined throughout the organization…
From the top management..to the operator regulating the steam flow in the ammine washing cycle ….or the oxygen percentage in the burners, …..or switching off or on the pumps
Opportunities, especially in the field people are a latent knowledge… they are below the level of attention of site managers as single opportunities…
Often it is known what you should do..it is simply not a priority…and it is not measured or rewarded..!!
Hence…a structured utilization of an effective mix of tools to foster participation is key!!
SLIDE NASCOSTA – solo in back up
you need to consider “hardware”, but also focus on soft causes…
It this real examples we’ve used a comprehensive, solid root-cause analysis, to map of possible poor E3 performance..
I am sure you’ll recognize most of the areas…
… Thermal integration…steam/heat losses…equipment energy efficiency optimization…energy optimization in plant management…
…in this case we’ve found more than 40 different actions to improve E3…
..but look at the colors…green are quick hits…blue are small/fast payback investments… violet are the more traditional large structural investments…
What a glance isn’t it? By focusing on large structural capex initiative, the violet ones…you are only poorly covering all your possible poor E3 causes… and there are some areas were soft issues makes the difference
…hence and again… you need to focus on all possible E3 loss causes…
We found that type of E3 losses are more common to several refineries than we thought….so our message to you is to check it up on those area…
Some are almost trivial though impact a lot the refinery energy consumption…
For example…
…steam/condensate recovery…
..pumps..or compressor absorption proportionate to flows..
..review of target oxygen in burners
..ecc…
All of these are partial examples of a longer list of area that we think every refinery should look into with a comprehensive and solid analytical approach
The results of the previous statements is almost trivial…
…but often overlooked in our experience….
….so…
Be sure to leverage on immediate or fast payback initiative..
This pie represents the split of benefit coming from different type of E3 opportunities we found in this case…
Almost 60% of benefit are coming from no or little capex initiative…
Even when investments are necessary,… they are usually between 0,5-1 million with a payback of 1-2 years
But… you also need to transform quick wins into long term performance…
……………..
This graphs is relative to the concentration of steam per cube meter in a stripping column ..before and after the implementation of a quick hit…
Before there was a difficulty in monitor fluid composition…
That turned into an excess in steam utilization to target product specification…
..by just inserting a base loop in the DCS with the correct set point and an appropriate training to the DCS operator…
The performance dramatically improved….
..but the improvement was not lasting…as you see…
..it tended to go back to previous poor performance…even with the base loop in place….
This was mainly due to operator behavior…
…once proper monitoring, rewarding procedures and training were reinforced …
The performance improved drastically even below expected target (that were already below data book target….)
This improvement translated into a 1.000 to 1.800 K€ and year
..and this is another good example of the same key issue…
Here we observe a graph plotting the oxygen % in a burner…
You can see that before the quick hits implementation there was a bad and highly variable performance, mostly significantly above data book target (the green line)….
… by simply setting a proper target and training and sensibilizing the operator to stick to that target….
The performance improved…got closer to target and became less variable..among operators….
…but again… it took a reinforcement of training, and relative monitoring procedure to really chance and uniform the operator attitude to this type of control….
This improvement translated into a 230K€ to 500 K€ a year..
What we have seen is only the top of an emerging iceberg…
You really have to Manage the E3 barrier across your organization….
And there are many barriers…
Of many differnt types…
Overall we think that the core probelm is that Energy inefficiency aren’t seen as costs!!...
We often see poor accountability on energy performance….
Lack of clear incentives…
That translates in lack of E3 focus in dayly activity across the refinery
And a one-fits-all approach to manage invements…!!
So… you need to improve your organization but not to jeopardize it!!
It really depends on were your atarting point is…
If you need a real change, from a total lack of E3 awerness,.. Then you might need a Radical boost leverigni a centralized model….
Like..creation of dedicated department
Clear and reinfroced top down objective…
If, most nicely, you are in a situation already acceptable but with space for improvement…
You might want to be sure to strenghtend a shared responsabily model, were E3 related responsability is more naturally encoded in each fucntion obkectives..
And processes and procedure are aligned to E3
Few organizational proceudre in place but measure and rewards their implementation in the daily rotuine.
Commit to and share the path with all organization…
Make all opportunity, important…
Celebrate eraly wins