energy management at john deere - iowa economic … management at john deere | ... rate case (“get...

11 April 2013 Iowa EDGE Industrial Energy Management Workshop

Joanne Howard, Manager Energy & Climate Strategy

Energy Management at John Deere

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Agenda

• About John Deere

• The Energy Efficiency Thread

o Facilities

o Manufacturing

o Employee Communications

o Design

• Concluding Comments

Iowa EDGE | 11 April 2013 2

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Committed to those linked to

the land

Founded in 1837

Core values: Integrity, Quality,

Commitment, Innovation

A world leader in providing advanced

products and services for agriculture, forestry,

construction, lawn and turf care, landscaping and

irrigation. A leading worldwide manufacturer

of off-highway diesel engines. One of the

largest equipment finance companies in the U.S.

3 Iowa EDGE | 11 April 2013

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Diversity of Product Lines and Application

Deere engines and equipment provide power to implements such as balers,

planters, seeders, plows, and scrapers; they load, haul, push, dig, grade, rake,

and apply a wide variety of materials; and they harvest, haul, cut, and process

grass, crops, and trees.

Deere manufactures over 100 different machine forms with over 1,000

applications.


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John Deere Manufacturing Locations

$36.16B in Net Sales and Revenue for FY2012

Greater than 55,000 employees worldwide

Operations in more than 35 countries


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Deere in Iowa

• ~12,900 Employees in Iowa (plus another 2,000 that live in Iowa)

• ~13,000 Retirees in Iowa

• ~1,500 Supplier contracts

• ~117 John Deere dealerships

• Major facilities in:

• Des Moines

• Waterloo

• Ottumwa

• Dubuque

• Davenport

Iowa Produced Products •Cotton Harvesting Equipment

•Planting Equipment •Spraying Equipment •Tillage Equipment •Ag Tractors •Components •Foundry •Engines •Hay & Forage Equipment •Articulated Dump Trucks •4WD Loaders •Motor Graders •Skidders •Wheeled Feller Bunchers •Backhoes •Compact Tracked Loaders •Crawler Dozers •High-Speed Dozers •Knuckleboom Loaders •Skid Steer Loaders •Tracked Feller Bunchers •Tracked Harvesters


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Energy is vital to John Deere


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It’s All Tied Together

Greenhouse Gas

Reduction

Energy Reduction

Cost Reduction

Environmental Sustainability

Strategy

Business Financial Metrics


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Facility: Efficiency - New


From the Deere Archives: 26 January 1932

History

• 1973 – Formal EM program

begins

• 1973 – 84 – Demand /

Efficiency Focus

• 1984 – Intervened in First Utility

Rate Case (“Get the price

right.”)

• 1986 on – Focus on Special

Contracts, Rates and

Government Affairs to Achieve

Reliable Service with the Best

Value to John Deere, and

encourage energy efficiency

• 2003 began GHG inventory

• 2007 joined EPA Climate

Leaders

• 2008 set global GHG reduction

goal

• 2013 launch of suite of eco-

efficiency goals

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Energy Usage and Opportunities


Enterprise Energy Usage

Fixed

Facilities

Variable

Production

Opportunities

• Capital Projects

• Procurement Projects

• Employee Engagement

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Facility Operation: Energy Efficiency = Lower Operating Costs

• Top Management Commitment

• Enterprise Energy & Climate Community of Practice

• Regional Energy Teams

• Unit Energy Champions

• Goals & Results Reporting

• Typical Energy Efficiency Projects: Lighting, Compressed Air, Motors, HVAC, Building Envelope

• Fuel Switching Projects: Biomass, Natural Gas

• Alternative Energy Projects: Solar


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The How

• Energy audits

• Incorporation in standards

• Energy projects need to meet the same financial hurdle rates as all other capital investment projects

• Partnerships – Trade organizations, IIEG, IECA, CII

• Effective utility energy efficiency programs

• 6 factories that use MidAmerican’s program

• 2 factories that use Alliant’s program

• 30 April: John Deere Dubuque Works is receiving an Alliant energy efficiency award for a major project, 2nd year in a row


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Factory HVAC Solution 105 HVAC units retrofitted with new controls & VFDs

Operational Results

• Units operate at reduced frequency/power but similar output

• Common control system for all units

• Future network connectivity for monitoring/control

Financial Results

• Over 7 MM kWh electrical savings

• Less than 1.5 year simple payback

Environmental Results

• Over 6,000 mtCO2e GHG reduction


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Manufacturing

Our Major Processes

Weld/Fabrication

Machining

Paint

Assembly

How

Standards

Competency Best Practice Sharing

Technology Innovation Paths


• Use 18” OC riser and nozzle spacing instead of typical 12”

• Demonstrated to be as effective

• Reduces pump energy by about 50%

• Reduces evaporation and hence heating energy

Paint Pretreatment Energy Conservation Example

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PNEUMATICALLY

OPERATED LIFT

TABLE

PNEUMATICALLY

OPERATED

TILTING TABLE

PNEUMATICALLY

OPERATED GRAVITY

MANUAL CONVEYOR

SYSTEM.

Hood Assembly Conveyor Design Example Zero Power – Utilizes Gravity and Pneumatic System


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Education and Communication

• Factory Posters

• Articles for plant electronic newsletters

• Informational slides on intrafactory TV

• Table tents for all break areas

• Energy etiquette flyers

• Security guards conduct audits

• Shutdown list for all departments

• All employee energy training

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Low Cost/No Cost

Setting timers on (2 new) washers so they are only warm when people are actually working.

Over $11k/year savings

Wire mist collector on grinder so it shut offs when the grinding wheel shut off.

Over $3k/year savings


Energy Treasure Hunt Pilot in May

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Global Design Tool Creation

Team

LEED Benchmarking (Ramos, Montenegro)

Internal Process Owner Feedback

Deere Tools

Industry Standards, Best

Practices

Design Tool

Project Name1-Jun-10

Design Consideration Class "A""3"

Class "B""2"

Class "C""1"

Real Estate(Site & Facilities)

Most convenient and efficient

condition for employees and

operations. Future flexibility and

expansion is considered.

Minimal consideration given for

convenient and efficient condition for

employees and operations. Future

flexibility and expansion is

considered but has l imits.

Future business operations could be

compromised by location issues.

Location may cause employee

attraction and retention issues.

Brand

Statement

Facility is recognizable as a John

Deere facil ity and embodies the

Company's core values. Facility is

recognizable as a Fortune 500

business. Facility is marketing

enabled to support customer visits.

Most public areas are recognizable as

a John Deere facil ity and support

l imited customer contact.

No marketing value to the location.

Facility is not appropriate for

customer or public visits. No Fortune

500 "feel" for facil ity.

Accommodations for business

visitors are minimal.

Business

Interruption

Production and information loss can

be recovered within least amount of

time


be recovered within time frame of

days rather than hours under most

conditions.


be recovered within a time frame of

weeks or months.

FM Global

ComplianceRisk to business is as low as can be

provided by a facil ity.

Limited protection of assets, business

processes, data, and production. May

impact insurance premiums to

Company.

Fire or severe weather events may

render the facil ity unusable. May

impact insurance premiums to

Company.

Building CodesHighest level of fire protection, lowest

energy consumption, highest level of

l ife safety. Redundancy of key systems

is provided.

Provides a safe and stable working

environment. Provides normal

minimum levels of fire protection and

life safety.

Likely to have low fire protection,

structural, and life safety

requirements.

Standards

Supports business continuity

directives and initiatives. Highest

first capital investment but lowest l ife

cycle operating costs. Provides for the

most flexible and adaptable

environment to support future

business needs.

Limited support of business continuity

directives and initiatives. Expect some

negative audit results. Mid-range first

capital investment but higher l ife

cycle operating costs. Provides some

flexibility and adaptability to support

future business needs.

Does not meet business continuity

directives. Expect many negative audit

results. Lowest first capital

investment but highest l ife cycle

operating costs. Cost of expansions

will be more than a typical new stand

alone project. No reserve capacity for

building util ities and support

systems.

Overall Class Rating:

• A process for all phases of design from construction through decommissioning

• Life cycle cost analysis tools/templates

• Common language/terminology

• Selected design solutions; linkage to JD tools, ABC matrix alignment

Design Guidelines Tool Goal


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JD SUSTAINABLE GUIDELINES TOOL

Filtering capability will produce customized strategy lists and design guidelines:

Location Project Phase

Facility Type

User Group

Custom JD

Project Strategy

Custom JD Project Strategy

Filter 3

Filter 2

Filter 1

Database of over 1,000 natural resource efficiency design strategies


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Energy Efficiency is a Foundational Element

Suppliers

•Drives efficient flow of goods and materials

Facilities

•Reduces operating costs

Products

•Demanded by Customers

Solutions

•Customers exist in a world of finite natural resources


Operational Footprint Customers Footprint

Employees – Understand it and can get behind it

Communications and Citizenship Policy, Standards & Regulations

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Energy Strategy Concluding Comments

• It’s a journey

• Globally competitive – all costs matter

• We have regional variations

• There is always opportunity

• It’s not easy (capital, time, resources constraints) – need to prioritize

• Lighting, HVAC, VFD projects are still there

• But, need to expand focus beyond the ‘usual suspects’

• Be vigilant on integrating with business processes

• Always need to tie: Greenhouse gas reduction=Energy reduction = Cost reduction

• Communicate, communicate, communicate


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