Energy Efficiency, a key question forbusiness success

Tommaso Auletta, Chalmers Energy Conference 2013, 16052013

About me

§ Tommaso Auletta

§ October 1972

§ Italian

§ 1999-2003 PhD in Nanotechnology from Universiteit Twente (NL)

§ 2003-2005 Post Doc KTH

§ ABB

§ 2005-2007 Project Manager Corporate Research (CRC)

§ 2009-2011 Group Manager CRC

§ 2011- Date Head of Energy Efficiency Sweden

© ABB GroupMay 10, 2013 | Slide 2

© ABB GroupMay 10, 2013 | Slide 3

Power and productivity for a better worldABB’s vision

As one of the world’s leading engineeringcompanies, we help our customers to useelectrical power efficiently, to increaseindustrial productivity and to lowerenvironmental impact in a sustainable way.

Energy efficiency: what is it?

© ABBSeptember 2011 | Slide 4

Base case Increased output,same kWh input

Reduced kWhinput, equal output

kWh kWh kWh

Energy/electricity input (kWh)

Process- or discrete output (e.g. tons, units)

Energy Efficiency

© ABB GroupMay 10, 2013 | Slide 5

World primary energy demand under current policiesDemand and related emissions rise in parallel

2009 2020 2035

+50%

Source: IEA WorldEnergy Outlook2011

The IEA Current Policies Scenario describes a future in whichgovernments make no change to existing energy policies

2009 2020 2035

+51%

World energy demand(in million tonnes of oilequivalent, Mtoe)

Energy-related CO2emissions (in gigatonnes)

12,13215,124

18,302

28.8

36.143.3

Uncertain future development

§ Energy price?

§ Laws and regulations, e.g.taxes on CO2 emissions,PFE which companies willhave to face?

§ Developing countries willstart competing even onhightech products

§ Rebalancing between emerging anddeveloped markets

§ Increasingly interconnected economies

§ States balancing negative impacts ofglobalization

§ Productivity imperative for developedcountries

§ Environmental protection – Pricing the planet

Source: McKinsey

Global forces that will change business the coming decadeProductivity and Resource Efficiency are strong drivers

= Energy Efficiency

Energy efficiencyLargest potential for emissions abatement

2009 20352020

*Carbon capture and storage

CO2 Emissions (Gt)

World energy-related CO2 savings potential by policy measure under450 Policy Scenario relative to Current Policies ScenarioKälla: IEA, World Energy Outlook 2011

New PolicyScenario

450 PolicyScenario

2020 2035

Efficiency 72% 44%

Renewables 17% 21%

Biofuels 2% 4%

Nuclear 5% 9%

CCS* 3% 22%

Energy savings in OECD countries due to energyefficiency since 1973 – final energy use

© ABB Inc.May 10, 2013 | Slide 9

This saving corresponds tothe production of 2500new nuclear power plants

Source: IEA, 2007,”Energy use in thenew millennium:trends in IEAcountries”

Historical productivity improvements

Source: McKinsey&Company

90% of the manufacturers said that improvements in theirenergy efficiency will be a critical factor for businesssuccess in the next two decades

Source: TheEconomistIntelligence Unit,”Trends in globalenergy efficiency2011”

Enercy Efficiency critical factor for success

… but there is still a lot to do

§ However, only 34% of the respondents had done acompany-wide energy audit and only 40% said they hadmade energy efficiency investments in the past threeyears.

Source: TheEconomistIntelligence Unit,”Trends in globalenergy efficiency2011”

Why is not industry investing more in EE?

42%Lack of clear-cut financial case for energy efficiencyinvestments

28%Lack of funds

27%Lack of information about Energy Efficiency

options

Source: TheEconomistIntelligence Unit”Trends in globalenergy efficiency2011”

Using energy more efficiently brings benefits alongmany fronts

§ Curbs emissions of carbon dioxide

§ Saves money through productivity gains and waste reduction

§ Increases competitiveneness

§ Reduced costs

§ Increased productivity

§ Reduced maintenance

§ Supports compliance with increasing regulations

§ Reflects favorably on a company’s sustainability performance andbrand

Energy Efficiency

The holisticapproach

Energy CarriersAir/Water

Gas

Thermal

Electrical

OperationsP

rodu

cts

Sys

tem

s

Rel

iabi

lity

Org

anis

atio

n

§ Building blocks already in place but need to be assembledfrom an energy perspective

§ Packaging and structuring of an energy strategy all throughthe entire organization

Energy Strategy a cornerstone for Energy work

ABB's proposed solution

• Frequency control of pumps

• Heat recovery from rolling oil

• Better adapted hydraulics

• Reduced use of compressed air

• Hot Flow

Total possible savings• Financial savings 1.7 million per / year

• Payback from 0 to 1.2 år

• Energy saving 2 GWh / year

• Reduction of cooling water by 44 000m ³ / year

• Reducing the air pressure with 1.356 millionm³ / year

Energy Analysis at Sapa Heat Transfer ABGave savings in million class in several areas

Month DD, Year | Slide 17© ABB Group

Högskolan i Jönköping

§ New control systemcontrols the ventilation forcarbon dioxide in thecourtroom

§ Better air and less use offans

§ Reduces powerconsumption and wear onthe fans

§ Costs for energy anddistrict heating reduces1-1.5 million per year

© ABB GroupMay 10, 2013 | Slide 19

Some energy efficiency projects at ABBFrom large to small

EcoDriving

LV Motors is investingin energy-savingEnergy Savings Fund has co-funded twoenergy saving projects in LV Motors, a freecoolign system and two electrical handtools, which saves both money and energy.

Leakage applicant camerafind minimum emissionsABB's internal energy savings fund contributes toenvironmental investment in new technology for leaks ofSF6 gas in high voltage switchgear and Production.

Remember-short leads racefor energy thievesA thesis in environmental and energy showed clearlywhere energy thieves were and how they could beeliminated. Encouragement came in the form of supportfrom ABB's Energy Savings Fund,

Changing the lighting in theworkshop of Service

Make use of waste heatfrom pressing and drying,Figeholm

New washing process, Cewe-Control