(28c) Integrated Operational Strategy for Energy Conservation

Porcelain Industries is a mid size company that uses high temperature furnaces to enamel metal parts and sub-assemblies for use in appliance and energy industries. Between December, 07 and July, 08 we saw a doubling of natural gas costs. To counter this significant economic challenge we used a integrated approach consisting of three different strategies to manage the cost increase. 1) We changed our operations from 8 hours a day, 5 days a week to 10 hours a day and 4 days a week. 2) We performed an energy audit and identified key consumers of energy in our plant and found ways to reduce consumption. 3) We instituted a rigorous performance monitoring system with real time monitoring of energy usage for our furnaces and a weekly review of total energy consumption. These steps resulted in a 25-30 % decrease in natural gas usage per $ of revenue. We also used a futures contract to hedge our demand to have predictable costs and to ensure supply in case there is a supply disruption during the Hurricane season.

Future steps in efficiency improvement include capital projects to improve furnace throughput in the near term and development of next generation of coatings that mature at significantly lower temperatures in the long term.