The Manufacturing Industry’s Electricity Demand, Explained
The manufacturing industry demands no small amount of electricity. While many facility managers clearly understand where the majority of that demand is consumed, there remains considerable opportunity to lower operating costs. Many factors ultimately shape your final energy bill, including local commercial energy rates and facility-wide efficiency.
How Much Electricity Does a Manufacturing Company Use?
US manufacturers use an average of 95.1 kilowatt-hours (kWh) of electricity and 536,00 Btu of natural gas per square foot annually. This average varies widely based on the size of the facility, the category of operations, and the age and efficiency of its equipment. Total energy consumption in the US increased 6% between 2018 and 2022, an acceleration from the 3.7% increase in the four years between 2010 and 2014.
How To Monitor and Improve Energy Efficiency in a Manufacturing Facility
Establishing a clear baseline is the most effective way to gauge and reduce electricity consumption. Our Commercial Energy Audit and Assessment services provide facilities with short-term and long-term energy data and a clear framework for improving efficiency.
Energy Benchmarking
These commercial energy assessments typically include a benchmarking exercise to establish baselines, which are useful for comparisons against similar manufacturing companies. Benchmarking can also compare your facility’s efficiency against Energy Star’s energy performance indicators.
Five Ways to Manage Electricity Costs in Manufacturing Facilities
There are many variables to consider when reducing electricity waste in manufacturing facilities.
Know Your Demand
Understand when your electrical needs peak and work to reduce demand systemwide at its highest. This process, known as peak management, can substantially lower your bill over time.
2. Know Your Demand Response
Utilize flexible scheduling to reduce consumption during peak energy rate periods.
3. Reduce Equipment Electrical Waste
Power down idling equipment whenever possible and implement a system to avoid idling unless necessary.
4. Upgrade to LED
Replace inefficient lighting fixtures to improve visibility and safety while reducing energy waste. LED lighting upgrades offer exceptional ROI for the vast majority of facilities.
5. Upgrade HVAC Equipment
Replace outdated HVAC equipment and introduce smart controls to optimize functionality year-round. Keen will help you find energy rebates, grants, and financing options to shorten your project’s ROI.
Read more: Electrical Load in Electricity
Manufacturing’s Energy Footprint
Energy improvements offer businesses a cost-effective way to lower operating costs and reduce their broader demands. Including all kinds of energy, manufacturers accounted for 35% of the US’s end-use energy consumption and 33% of total energy consumption. Natural gas powers roughly 33% of the industry’s energy, followed by electricity, much of it from fossil fuel power stations.
How to Read Your Manufacturing Energy Bill
Commercial utility bills may look slightly different depending on the provider, but they will always have a few key lines.
Meter charges - The fixed charge for being connected to the grid. This largely goes toward the supplier’s maintenance expenses.
Energy charges - The actual charges for the energy used during the specific period. This is sometimes labeled as “delivery” or “generation” charges.
Demand charges - The charges for the maximum amount of energy used at any given time during the billing period, typically measured in kilowatts (kW). This charge isn’t included on all rate plans.
Your bill will also include a summary of total energy use in kilowatt-hours by peak period during the billing cycle, an average cost, and total cost by time of day. This information can provide a clear path toward lowering expenses; our team can help!
Improve Your Manufacturing Facility’s Electricity Efficiency
Understanding and lowering your electricity use provides immediate and long-term savings that help your business grow. Our experienced energy consultants will identify the most cost-effective opportunities to save money and meet your organization’s environmental goals. Let’s get started; contact our team today.