EAM Energy Management Tools for Facility Managers

May 15, 2009

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Topics

Total Resource Management (TRM) Overview Identifying Goals and Strategy Executing Strategy Getting Buy-in

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Enterprise Asset Management (EAM)*

Not simply “maintenance and repair” Goal: Optimal management of all physical assets

– Maximize the return on assets (ROA)– Maximize asset quality/condition/performance/availibility– Maximize asset life– Minimize operating and capital costs

Consider the entire asset lifecycle and the entire enterprise Recognize the interdependency of assets and operations Incorporate industry best practices Enabled by technology

– World wide web and corporate networks– Web-based software– Mobile devices and wireless data networks

Responds to increasing external business drivers– Global competition– Health, safety, environmental, and energy concerns and regulations

*www.wikipedia.com

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TRM Overview

• Founded in 1994

• >200 EAM Clients• >300 Sites

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55

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1515

2020

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19981998 19991999 20002000 20012001 20022002 20032003 20042004 20052005

$ M

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ns$

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150150

200200

250250

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350350

400400

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• >400 Staff Years of

EAM experience

• >$100M in EAM Services & Solutions

Consulting and Technology SolutionsFocused on Enterprise Asset Management (EAM)Global Project ExecutionOffices in/near Alexandria, Norfolk, Honolulu, Philadelphia, San DiegoIBM Advanced Business PartnerIBM Passport Advantage Resellerwww.trmnet.com

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TRM Services

EAM Consulting Services – Asset management strategy– Business process improvement– Performance metrics– Business case analysis– Enterprise IT systems deployment– EAM software performance management

Maintenance Consulting Services– Maintenance practice standardization – EAM System location/equipment hierarchy design– Field data collection

EAM System Services and Support– Requirements analysis, project planning, and change management– Systems design, configuration, and tailoring– System implementation, integration and deployment– eLearning, IBM-authorized, train-the-trainer, and end-user training – Onsite and on-call support

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TRM Subject Matter Expertise

Asset classes– Facilities– Fleet Vehicles– Electrical generation, transmission, distribution– Water and wastewater utilities– IT asset management

Facilities Condition Assessment Capital Project Planning, Prioritization, and Budgeting Service Management Maintenance best practices (RCM/FMEA, etc.) Inventory Management and Logistics Equipment Condition Monitoring Mobile work and inventory management

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Identifying Goals and Strategy

Decrease Energy Consumption

What Will You Measure?

How to Measure It?

What to Do with the Information?

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Federal Goals - E. O. 13423

Reduce 30 % by 2015

Reduce 30% by 2015

50% purchases must come from new renewable sources

Construct or renovate buildings in accordance withsustainability strategiesReduce 16% by 2015

Increase purchase of alternative fuel, hybrid, and plug-in hybrid vehicles when commercially available.

Reduce 2% annually through 2015Increase by at least 10% annually

Reduce use of chemicals and toxic materials and purchase lower risk chemicals and toxic materials.  Expand purchases of environmentally sound goods and services, including bio-based products.  95% percent of electronic products purchased must meet Electronic Product EnvironmentalAssessment standards

Energy Efficiency Greenhouse Gases Renewable Power Building Performance Water Conservation Vehicles Petroleum

Conservation Alternative Fuel Pollution Prevention Procurement Electronics

Management

Objective Requirement

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CURRENT SITUATION

THE FUTURE

Achieving Asset Health and Fitness

Source: Aberdeen Group

PREVENTATIVEPREVENTATIVE

REACTIVEREACTIVE

PASSIVEPASSIVE

PREDICTIVEPREDICTIVE

HOLISTICHOLISTIC

Applies all concepts to the appropriate assets to optimise, improve and evolveasset performance

Anticipate problemsbefore they occur.

Prevent breakdownsand maximises plant capacity by real-timemonitoring of asset condition indicatorsincluding vibration,quality degradation,

and run time and compares to

asset reference models.

One step ahead of breakdowns.

Usually involves missioncritical , complex and high capacity assets. Complete maintenance work and

inspections before failuresoccur.

Break-fix strategy.Potential for

significant assetdowntime and lost

capacity. Usually involves

non-mission critical and simple Assets

Maintenance relegatedto lower levels in

Organisation. Assets not critical, downtime,lost production or

capacity not important.

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Continuous CommissioningPreliminary Data Collection

(e.g. equipment nameplate information, set points, energy efficiency, operations limits)

Continuously monitor and run equivalent functional asset tests

Continuously record, analyze and interpret observations and functional test results

Manually correct problems, change installation, replace, repair

Report results. store and archive data

Asset Module

SCADA ; Meters

Condition Monitoring

Failure Hierarchies

KPI’s, Reporting, Analytic Tools

Commission fixes

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Executing Strategy

Automate Asset Management Processes and Resource Consumption

Configure and Capture HVAC Failure Hierarchies to Reduce Equipment Failure

Utilize HVAC Monitoring Software to Generate Alerts And Work Orders Within an EAM System

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Energy integration into EAM strategy…

Maintenance Program Management: factoring asset operating performance (Energy consumption) into maintenance strategy and activities

Event Management: alerting of existing asset condition or trend outside of optimum operating parameters for assessment or remediation

Asset Sustainability Spend$208 Billiion N.A. Market

87%

13%

C&I Energy Spend

C&I Maintenance Spend

EAM Objectives

Asset Sustainability Spend ($208B N.A. C&I Market)

4,475B kWh N.A. Energy Market 16,599B kWh World-wide Energy Market

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… to improve a company’s overall equipment operating performance at the least cost and environmental impact. Energy is the single largest indirect operating expense; > 60% of O&M expense Energy is the largest contributor of CO2 Gases which comprise 63% of all GHG

Energy integration into EAM strategy…

Planning: assessing existing asset configuration (design basis) and performance (energy consumption) for optimization

EAM Objectives

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Energy Program Management Asset Energy Consumption and Rates Utility Consumption Commodity Tracking Utility Consumption Cost Detail Tracking Preloaded UOMs, Energy Attributes and

Conversion Values Operational Performance History Key Performance Indicators and Graphs Energy Consumption Data Warehouse Standard Reports

System Requirements

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Event Management Consumption Visibility and Alert Management Operational Anomaly Identification Alert Management and Workflow Action Management and Planning Historical Impact Analysis Configurable Preferences & Process Integration Capabilities

Planning Energy Cost Integration Capital Planning Asset Design Change Management Procurement Engineering OEM Equivalency Evaluation MRO and Supplier Technology Collaboration Analytics & Reporting

System Requirements….

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Example: Pumping System Efficiency

Pumping efficiency SYS is defined as follows:

e

reqreqreq P

SGHQ

5308

HP kW Time (hrs)

Actual System Efficiency Calculated from Field Measurements (

Optimal System Efficiency (

300 235 6000 .55 .78

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Example: Improve Pump System Efficiency Inefficiency Causes (Leaks, Heat, etc.):

– Improper install– Misadjusted parts– Worn bushings– Worn rings– Worn gaskets

Corrections– Pump replacement– Replacing or refurbishing:

• Wear Rings• Impellers• Pump bowls

Process Change– PM’s– Inspections– Predictive Maintenance

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Example: Pump Efficiency Savings

Example

Efficiency testing and analysis indicate that a 300-horsepowerCentrifugal Pump has an operating efficiency of 55%. However the manufacturer’s pump specification indicates that it should operate at 78% efficiency. The pump draws 235kW and operates 6,000 hrs. per year.

Assuming that the pump can be restored to operate at its origin or design performance condition, estimated annual energy savings are as follows:

Savings = 235kW x 6,000 hrs./year x (1-(.55/.78)) = 415,769kWh/yr.

At an average cost of 5 cents per kWh, the estimated savings would be $20,786 per year.

The pump should have cost: (300 HP x .746 kW/HP x 6,000 hrs. x $.05/Kwh ) / .78 efficiency = $76,139 per yr.

Results in a 21% reduction in energy cost attainable through energy efficiency integrationwith asset management activities.

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Getting Buy-In

• Management Information• Return On Investment (ROI) Analysis

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Management Information

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EAM ROI

Shift focus from “cost” to “investment” & “payoff” Types of investment return

– Hard: reduced cost, headcount, etc.– Soft: real but not quantifiable (e.g., freed up time)– Risk mitigation: taking no action may cost more

C-Level Executives Want to Know– Capital required?– How long to show a return?– How long until cash-flow is positive?– Top-line growth– Bottom-line improvement– Improved brand identity

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Typical ROI Metrics

Top-line improvements– Improved quality– Assured scheduling– Uniform, standardized processes, practices, and data– Longer demand lead time– Shorter supply lead time

Bottom-line Improvements– Reduced cost of resources – Reduced process and equipment downtime– Reduced regulatory penalties– Reduced scrap and rework

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Methods of Financial Analysis

Net Savings Benefit/Cost Ratio Payback Period Internal Rate of Return (IRR)

Per period or over time

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Financial Analysis Example

Source: Infor

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Questions?