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24 Improving Steam System Performance

Steam System Basics

Section 2: Performance Improvement Opportunities

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OverviewThis section of the Sourcebook discusses importantfactors that should be considered when industrialfacilities seek to improve steam system perform-ance and to lower operating costs. Improvingsteam system performance requires assessing theentire system, identifying opportunities, andselecting and implementing the most feasibleprojects. In turn, this requires a systems approach.Similarly, proper selection of the best projectsrequires quantifying the benefits and costs ofeach project. Successful implementation of theseprojects requires the participation of all systemstakeholders including production, maintenance,and management. Generally, obtaining manage-ment participation requires communication ofthe analyses in economic terms. To address theseconsiderations, this section of the Sourcebookdiscusses:� The systems approach

� Common performance improvement opportunities

� Resources that can help identify and assess opportunities

� The economics related to steam system improvements.

Systems ApproachBecause of the many industrial uses for steam,there are wide ranges of steam system sizes, con-figurations, end-use applications, and operatingpractices. As a result, there are many differentways to improve steam system performance andidentify improvement opportunities. In general,performance is most effectively optimized when asystems approach is used.

A systems approach analyzes both the supply anddemand sides of the system and how they inter-act, essentially shifting the focus from individualcomponents to total system performance. Often,operators are so focused on the immediatedemands of the equipment that they overlook thebroader issue of how system parameters affect the

equipment. Similarly, a common engineeringapproach is to break a system down into its basiccomponents or modules, optimize the selection orthe design of these components, and then assem-ble these components to form the system. Anadvantage to this approach is that it simplifiesproblems. However, a disadvantage is that it oftenoverlooks the interaction of these components. Incontrast, a systems approach evaluates the entiresystem to determine how the end-use requirementscan be most effectively and efficiently served.

A systems approach also recognizes that systemefficiency, reliability, and performance are closelyrelated. For example, an efficiency loss such asheat loss across uninsulated pipe surfaces reducesenergy available to the end uses and requiresboilers to work harder to meet a given demand.Often, energy losses create additional systemstresses that accelerate wear and that can createloads for which the system was not originallydesigned.

Common PerformanceImprovement Opportunities

Several steam system improvement opportunitiesare common to many industrial facilities. Theseopportunities can be categorized according to thepart of the system in which they are implement-ed. Common performance opportunities for the generation, distribution, and recovery areas of asteam system are listed in Table 2.

� End-Use Improvement OpportunitiesThere are many ways to optimize steam usedepending on the process and the equipment.Specific End Uses for Industries of the Future(IOF) steam systems can be found in Table 1 ofthe End Use section. In some cases, equipmentcan be installed to make the process more effi-cient; for example, multiple-stage dryers areoften more efficient than single-stage dryers.However, in general, optimizing the efficiency ofsteam-supplied end uses requires a case-by-caseassessment.

A Sourcebook for Industry

Performance Improvement Opportunities

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BestPractices Steam SystemPerformance Tools

The U. S. Department of Energy (DOE) BestPrac-tices Steam effort has developed a suite ofresources and tools that can be used to identifyand assess steam system improvement opportu-nities. These resources and tools are described inthis section of the Sourcebook. Additional steamimprovement resources and tools are identifiedin the Resources section of the Sourcebook.

� Steam System Scoping ToolThe Steam System Scoping Tool is a spreadsheetprogram that can assist steam operation andmanagement personnel to assess their steam systems. The program is intended for use bysteam system energy managers and operationspersonnel in industrial plants. This tool alsohelps assess steam system operations againstidentified best practices.

The Steam System Scoping Tool contains sevenworksheets:

Improving Steam System Performance

Opportunity Description

Generation

Minimize excess air Reduces the amount of heat lost up the stack, allowing more of the fuel energyto be transferred to the steam

Clean boiler heat transfer surfaces Promotes effective heat transfer from the combustion gases to the steamInstall heat recovery equipment Recovers available heat from exhaust gases and transfers it back into the(feedwater economizers and/or system by preheating feedwater or combustion aircombustion air preheaters)Improve water treatment to minimize Reduces the amount of total dissolved solids in the boiler water, which allowsboiler blowdown less blowdown and therefore less energy lossRecover energy from boiler Transfers the available energy in a blowdown stream back into the system,blowdown thereby reducing energy lossAdd/restore boiler refractory Reduces heat loss from the boiler and restores boiler efficiencyOptimize deaerator vent rate Minimizes avoidable loss of steam

Distribution

Repair steam leaks Minimizes avoidable loss of steamMinimize vented steam Minimizes avoidable loss of steamEnsure that steam system piping, Reduces energy loss from piping and equipment surfacesvalves, fittings, and vessels are wellinsulatedImplement an effective steam-trap Reduces passage of live steam into condensate system and promotes efficientmaintenance program operation of end-use heat transfer equipmentIsolate steam from unused lines Minimizes avoidable loss of steam and reduces energy loss from piping and

equipment surfacesUtilize backpressure turbines instead Provides a more efficient method of reducing steam pressure for low-pressureof PRVs services

Recovery

Optimize condensate recovery Recovers the thermal energy in the condensate and reduces the amount of makeup water added to the system, saving energy and chemicals teatment

Use high-pressure condensate to Exploits the available energy in the returning condensatemake low-pressure steam

Table 2. Common Performance Improvement Opportunities for the Generation, Distribution,and Recovery Parts of Industrial Steam Systems




1. Introduction—provides instructions on howto use the guide and what is indicated by theresults.

2. Basic data—prompts the user to answer generalquestions such as the amount of fuel used, amount of steam generated, and other generalsystem data.

3. System profiling—assesses how the user tracks steam costs, benchmarks steam use,and measures important general operatingparameters.

4. Operating practices of the total system—queries the user regarding practices such astrap maintenance, water treatment, insulation condition, leak repair, and general equipmentinspection.

5. Operating practices of the boiler plant—queries the user on boiler efficiency, heatrecovery equipment, steam quality, and general boiler operation.

6. Operating practices of the distribution, end-use, and recovery portions of the steam system—queries the user about the use ofpressure reducing valves, condensate recovery,and the use of condensate to generate low-pressure steam.

7. Summary sheet—provides scores based on user responses.

� Steam System Survey GuideThe Steam System Survey Guide is a reference doc-ument that is intended for use by plant energymanagers and system operations personnel. The Survey Guide provides a technical basis foridentifying and assessing many potential steamsystem improvement opportunities. Althoughseveral of these opportunities can be identifieddirectly with the survey guide, others requiremore sophisticated measurements and data gathering methods.

The Scoping Tool and the Survey Guide are com-plementary. The Scoping Tool allows a user todetermine how well the system is performing andis also useful in tracking the effectiveness of systemimprovements. The Survey Guide provides a morequantitative description of the system operationand how to quantify some of the potential steamsystem improvement opportunities. These toolsare available from DOE’s Industrial TechnologiesProgram (ITP) BestPractices Web site atwww.eere.energy.gov/industry/bestpractices.

The Web site also offers links to other resourcesthat can assist end users in improving the per-formance and efficiency of their energy-intensiveutility systems.

� Steam System Assessment ToolThe Steam System Assessment Tool allows usersto assess potential savings from individualizedsteam system improvements. Users may inputdata about the condition of their plant and theSteam System Assessment Tool generates modelsof various improvement scenarios. Results detailthe energy, cost, and emissions savings that avariety of improvements could achieve.

The tool contains all the key features of typicalsteam systems—boilers, backpressure turbines,condensing turbines, deaerators, letdowns, flashvessels, and feedwater heat exchangers. Themodel analyzes boiler efficiency, boiler blow-down, cogeneration, steam cost, condensaterecovery, heat recovery, vent steam, insulationefficiency, alternative fuels, backpressure tur-bines, steam traps, steam quality, and steamleaks.

� 3E Plus Insulation Appraisal SoftwareBecause insulation is used in every steam system,its restoration, replacement, or installation arecommon improvement opportunities. A lack ofawareness regarding the energy losses and theassociated costs often results in a low prioritiza-tion of restoring or properly installing insulationon steam system surfaces. As a result, a softwareprogram known as 3E Plus was developed by the North American Insulation ManufacturersAssociation (NAIMA). The program increasesawareness among steam system operations andmanagement personnel of the benefits of insula-tion and assists these stakeholders in assessinginsulation opportunities.

3E Plus assists the user in assessing important insulation project factors such as energy savings,installation cost, and payback period for variousinsulation materials and thicknesses. Users of 3E Plus can estimate energy losses from uninsu-lated surfaces as well as potential savings fromvarious insulation options.

The program has general data for insulationcosts by type and can analyze insulation cross-sections that use several different insulation types.It also accounts for labor rates and productivity

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by region, estimating how difficult the installa-tion process will be based on general pipingcharacteristics. Users can quickly determine theeconomic feasibility of various insulation thick-nesses. Since the program also allows the user to evaluate various combinations of insulationtypes, 3E Plus can help the user optimize thematerial thicknesses within an insulation system.Download 3E Plus from the BestPractices Web siteat www.eere.energy.gov/industry/bestpractices.

� NIA’s Insulation Energy Appraisal Program (IEAP)

The National Insulation Association (NIA), anITP Allied Partner, has developed a training program that offers certification to professionalswho conduct insulation appraisals or specifyinsulation requirements. This program is intendedto provide credibility to insulation professionalsand to increase consistency of the message thatis presented to clients. This program has four keycomponents:� Awareness Building—an important way to

increase awareness of the potential cost savingsfrom insulation projects is to effectively promoteinsulation appraisal as a professional service.

� Information Gathering—determining the partsof the system that have the most attractiveinsulation improvement opportunities usuallyrequires input from the plant personnel.Improving the interview techniques of insula-tion professionals can increase the usefulnessof these assessments.

� 3E Plus—the 3E Plus program is an important tool for insulation professionals and specifyingengineers. Learning to effectively use this toolcan improve the quality of the assessment find-ings, presentation of recommendations, andcost-effective specification of new insulation.

� Reporting—accurately and effectively report-ing the results of an insulation assessment cansignificantly increase the probability that the recommendations will be implemented.

Information regarding the Insulation EnergyAppraisal Program (IEAP) can be obtained fromthe NIA Web site at www.insulation.org.

� Steam Tip SheetsSome improvement opportunities are available to many different systems. To increase industryawareness of several fundamental improvement

opportunities, ITP has developed steam tip sheetsthrough its BestPractices activities.

These steam tip sheets provide concise descriptionsof common improvement opportunities. BecauseBestPractices continues to develop and identifyenergy improvement programs, additional tipsheets are expected. Steam tip sheets available bythis Sourcebook’s publication date can be foundin Appendix B. Additionally, steam tip sheets canbe found on the BestPractices Web site atwww.eere.energy.gov/industry/bestpractices/.

Steam System Training� Steam End User Training This 1-day course covers the operation of typicalsteam systems and discusses methods of systemefficiency improvement. The training is designedfor plant personnel, such as energy managers,steam system supervisors, engineers, and equip-ment operators, who have steam system respon-sibilities in industrial and institutional plants.The course covers three key areas of potentialsystem improvement:

� Steam Generation Efficiency

� Resource Utililization Effectiveness

� Steam Distribution System Losses

The course introduces the Steam System ScopingTool and the Steam System Assessment Tool,both developed by DOE's BestPractices and usesthe Steam System Survey Guide as a technical reference. The training also introduces the 3EPlus insulation appraisal software and a course example is presented that uses this software.

� Steam Tool Specialist Qualification TrainingIndustry professionals can earn recognition asQualified Specialists in the use of the BestPracticesSteam Tools. DOE offers an in-depth, two-and-a-half-day training for steam system specialists,including two days of classroom instruction anda written exam. Participants who complete thetraining and pass the written exam are recog-nized by DOE as Qualified Steam Tool Specialists,and are listed on the BestPractices Web site. Specialists can assist industrial customers inusing the BestPractices Steam Tools to evaluatetheir steam systems.

The BestPractices Steam System Specialist Qualifi-cation training is primarily designed for steam



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specialists who are interested in becoming profi-cient in using the BestPractices Steam Tools. Tosuccessfully complete the Specialist QualificationTraining course, a participant must understand thefull suite of BestPractices Steam tools including:

� Steam System Survey Guide

� Steam System Scoping Tool – Accurate collection and input of data

for use with the tool

– Appropriate utilization of the software

– Interpretation of the software results

� Steam System Assessment Tool

– Accurate collection and input of data for use with the tool

– Development of representative system models

– SSAT limitations

– Individual project identification

– Development of practical methods to accomplish the appropriate projects

� 3E Plus

– Accurate data gathering for basic insulation related evaluations

– Development of evaluation techniques related to common insulation evaluations.

Class participants will receive a PrerequisiteTest/Study Guide before attending the class. ThisStudy Guide provides an indicator of the skilllevels necessary to successfully complete the Specialist Qualification training. Completion ofthis Study Guide is highly recommended, but isnot a requirement to take the training. Comple-tion of BestPractices Steam End User training isalso recommended prior to participating in theSpecialist Qualification training class, which covers the majority of the Specialist Qualificationtraining prerequisites.

To learn more about the Steam System SpecialistQualification training, visit the BestPractices Website at www.eere.energy.gov/industry/bestpractices.

Overview of FinancingSteam System Improvements

Very often, industrial facility managers must convince upper management that an investment in steam efficiency is worth the effort. The com-munication of this message can often be more

difficult than the actual engineering behind theconcept. The corporate audience will respondmore readily to an economic impact than to adiscussion of Btu, pounds of steam, and efficiencyratios. By adopting a financial approach, thefacility manager relates steam efficiency to corpo-rate goals. Collaboration with financial staff canyield the kind of proposal that is needed to convince corporate officers who have the finalword about capital investments such as steamsystem upgrades.

Before laying out some recommendations forhow to justify steam improvement projects, it isuseful to understand the world as the corporateoffice usually sees it.

� Understanding Corporate PrioritiesCorporate officers are held accountable to a chiefexecutive, a board of directors, and an owner (or shareholders, if the firm is publicly held). It is the job of these officers to create and grow the equity value of the firm. The corporation’sindustrial facilities do so by generating revenuethat exceeds the cost of owning and operatingthe facility itself. Plant equipment—includingsteam system components—is an asset that mustgenerate an economic return. The annual earn-ings attributable to the sale of goods produced bythese assets, divided by the value of the plantassets themselves, describe the rate of return onassets. This is a key measure by which corporatedecision-makers are held accountable.

Financial officers seek investments that are mostcertain to demonstrate a favorable return onassets. When faced with multiple investmentopportunities, the officers will favor those optionsthat lead to both the largest and fastest returns.

This corporate attitude may impose (sometimesunpleasant) priorities on the facility manager:assure reliability in production, avoid unwantedsurprises by sticking with familiar technologyand practices, and contribute to cost controltoday by cutting a few corners in maintenanceand upkeep. This may result in industrial deci-sionmakers concluding that steam efficiency is a “luxury” that cannot be afforded.

Fortunately, the story does not end here. What follows is a discussion of ways that industrialsteam efficiency can save money and contributeto corporate goals while effectively reducing



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energy consumption and cutting noxious combustion emissions.

� Measuring the Dollar Impact of Steam EfficiencySteam efficiency improvements can move to thetop of the list of corporate priorities if the proposalsrespond to distinct corporate needs. Corporatechallenges are many and varied, which in turnopen up more opportunities to “sell” steam efficiency as a solution. Steam systems offermany opportunities for improvement; the partic-ulars are shared elsewhere in this Sourcebook.Once the selections are made, the task is one of communicating the proposals in corporatefinancial language.

The first step is to identify and enumerate thetotal dollar impact of a steam efficiency measure.One framework for this is known as “life-cycle costanalysis.” These analyses capture the sum total ofexpenses and benefits associated with an invest-ment. The result—a net gain or loss on balance—can be compared to other investment options or tothe anticipated outcome if no investment is made.As a comprehensive accounting of an investmentoption, the life-cycle cost analysis for a steam effi-ciency measure would include projections of:

� Search and selection costs for seeking an engineering implementation firm

� Initial capital costs, including asset purchase, installation, and costs of borrowing

� Maintenance costs

� Supply and consumable costs

� Energy costs over the economic life of the implementation

� Depreciation and tax impacts

� Scrap value or cost of disposal at the end ofthe equipment’s economic life

� Impacts on production such as product quality and downtime.

One revelation that typically emerges from thisexercise is that fuel costs may represent as muchas 96% of life-cycle costs, while the initial capitaloutlay is only 3%, and maintenance a mere 1%.These findings may be true for boilers with a 20-year life operating at high rates of capacityutilization. Clearly, any measure that reduces fuelconsumption (while not impacting reliabilityand productivity) will certainly yield positivefinancial impacts for the company.

� Financing Steam Efficiency ImprovementsAs with any corporate investment, there aremany ways to measure the financial impact ofsteam efficiency investments. Some methods aremore complex than others are, and proposalsmay use several analytical methods side-by-side.The choice of analyses used will depend on thesophistication of the presenter and the audience.

A simple and widely used measure of project economics is the payback period. This is definedas the period of time required for a project to“break even.” It is the time needed for the netbenefits of an investment to accrue to the pointwhere they equal the cost of the initial outlay.For a project that returns benefits in consistent,annual increments, the simple payback equalsthe initial investment divided by the annual ben-efit. Simple payback does not take into accountthe time value of money; in other words, itmakes no distinction between a dollar earnedtoday versus a dollar of future (and thereforeuncertain) earnings. Still, the measure is easy touse and understand and many companies usesimple payback for a quick “go/no-go” decisionon a project. Five important factors to rememberwhen calculating a simple payback:

� It is an approximation, not an exact economic analysis

� All benefits are measured without considering their timing

� All economic consequences beyond the payback are ignored

� Payback calculations will not always find thebest solution (for the two reasons immediatelyabove) when choosing among several projectoptions

� Payback does not consider the time value of money or tax consequences.

More sophisticated analyses take into account factors such as discount rates, tax impacts, thecost of capital, etc. One approach involves calcu-lating the net present value of a project, which isdefined in the equation below:

Net present value = Present worth of benefits –Present worth of costs

Another commonly used calculation for determin-ing economic feasibility of a project is internalrate of return, which is defined as the discountrate that equates future net benefits (cash) to an



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initial investment outlay. This discount rate canbe compared to the interest rate at which a corporation borrows capital.

Many companies set a threshold (or hurdle) ratefor projects, which is the minimum requiredinternal rate of return for a project to be consid-ered viable. Future benefits are discounted at thethreshold rate, and the net present worth of theproject must be positive in order for the projectto be a “go.”

� Relating Steam Efficiency to Corporate PrioritiesSaving money should be a strong incentive foradopting steam efficiency. Still, that may not beenough for some corporate observers. The facilitymanager’s case can be strengthened by relating a positive life-cycle cost outcome to specific corporate needs. Some suggestions for interpret-ing the benefits of fuel cost savings include the following (finance staff can suggest which ofthese approaches are best for the current corpo-rate climate):

� A new source of permanent capital. Reducedfuel expenditures—the direct benefit of steamefficiency—can be thought of as a new sourceof capital for the corporation. The investmentthat makes this efficiency possible will yieldannual savings each year over the economiclife of the improved steam system. Regardlessof how the steam efficiency investment isfinanced—borrowing, retained earnings, orthird party financing—the annual savings willbe a permanent source of funds as long as thesteam efficiency savings are maintained on acontinuous basis.

� Added shareholder value. Publicly held corpo-rations usually embrace opportunities toenhance shareholder value. Steam efficiency can be an effective way to capture new value.Shareholder value is the product of two variables: annual earnings and the price-to-earnings (P/E) ratio. The P/E ratio describes the corporation’s stock value as the current stock price divided by the most recent annual earnings per share. To take advantage of this measure, the steam efficiency proposal shouldfirst identify annual savings (or rather, additionto earnings) that the proposal will generate.Multiplying that earnings increment by theP/E ratio yields the total new shareholdervalue attributable to the steam efficiencyimplementation.

� Reduced cost of environmental compliance.Facility managers can proactively seek to limitthe corporation’s exposure to penalties relatedto environmental emissions compliance. Steamefficiency, as total-system discipline, leads tobetter monitoring and control of fuel use.Combustion emissions are directly related tofuel consumption; they rise and fall in tandem. By implementing steam efficiency,the corporation enjoys two benefits: decreasedfuel expenditures per unit of production, andfewer incidences of emission-related penalties.

� Improved worker comfort and safety. Steamsystem optimization requires ongoing moni-toring and maintenance that yields safetyand comfort benefits in addition to fuel savings. The routine involved in systemmonitoring will usually identify operationalabnormalities before they present a danger toplant personnel. Containing these dangersprecludes threats to life, health, and property.

� Improved reliability and capacity utilization.Another benefit to be derived from steam efficiency is more productive use of steamassets. The efforts required to achieve andmaintain energy efficiency will largely con-tribute to operating efficiency. By ensuringthe integrity of steam system assets, the facili-ty manager can promise more reliable plantoperations. The flip side, from the corporateperspective, is a greater rate of return onassets employed in the plant.

� Call to ActionA proposal for steam efficiency implementationcan be made attractive to corporate decision-makers if the facility manager:

� Identifies opportunities for achieving steam efficiency

� Determines the life-cycle cost of attainingeach option

� Identifies the option(s) with the greatest net benefits

� Collaborates with financial staff to identify current corporate priorities (for example,added shareholder value, reduction of envi-ronmental compliance costs, and improvedcapacity utilization)

� Generates a proposal that demonstrates howthe steam efficiency project’s benefits willdirectly respond to current corporate needs.



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