Topic #3: Equipment replacement and process consolidation  

Unlock energy saving opportunities by reviewing and consolidating your processes, as well as replacing your equipment at the right time.

First, watch this video to learn how Replas, an Australian plastics SME, has found significant energy saving opportunities by replacing old equipment with newer technology, reducing engine sizes to match operational requirements, and modifying equipment parts to more energy efficient alternatives. These simple ideas can be implemented in your business too!



Overview

When it is time to replace your key equipment, a newer more efficient option will usually be available to you. This will of course deliver direct savings. However it is also important to know that the cumulative cost of powering and running the equipment far exceeds the initial capital cost. As Mark Jacobsen, Replas Director, says in the video above, “Energy efficiency and growing your business go hand in hand.”

It is therefore important to think about any upgrades or replacements within the broader process or system. This presents an excellent opportunity to review your overall system needs and identify refinements that can reduce energy use, improve productivity and save money.

In this section, you will find the tools you need to:

☑  Know the questions to ask when considering new equipment purchases
☑  Understand your operating needs, and choose equipment to match
☑  Build the business case
☑  Identify opportunities to change or upgrade equipment to deliver process and energy efficiencies
☑  Know when to think about upgrading or replacing equipment
☑  Understand the value of a building management system

Start by working through the Tutorial below, to identify priorities and opportunities specific to your business. Use the tools and resources provided on this page to take action, and remember to regularly refer back to your energy plan to ensure you stay on track.

Tutorial

Purchasing new equipment is often a big decision for a business. Fully understanding the whole of life energy costs, maintenance costs and energy efficiency opportunities will help ensure a smart decision is made. It is also a fantastic chance to engage suppliers and others to help.

Use the following tutorial questions to ensure you know the questions to ask when looking at equipment purchases (whether brand-new or just new to your business), and the larger system they fit within.

Question one:
Are you currently planning new equipment purchases? If yes, go to question 2. If not, read PACIA energy+ 5 Minute Guide #8 to find out how you can raise awareness in your business of what you should consider when looking at new equipment.

Question two:
Do you have to replace like for like or do alternatives exist? If yes, go to question 3. If not, talk with your staff and supplier to understand equipment options and their energy footprint.

Question three:
Does the new equipment form part of an operational process or does it stand alone? If yes, go to question 3. If not, ask your supplier for information on the equipment’s energy use over its life time and investigate whether more energy efficient alternatives exist for your entire process.

Question four:
How does the new equipment influence the process it is part of and what can be changed in the overall process to improve the energy efficiency of the whole system? See PACIA energy+ 5 Minute Guide #8 for ideas about checking system needs for heat, steam, compressed air and cooling required to ensure correct sizing and energy efficiency. Also view the above video to learn how a medium sized manufacturing company in the chemicals and plastics industry has driven down energy consumption significantly through equipment replacement.

 

Relevant PACIA energy+ 5 Minute Guides

Download the 5 Minute Guides under this topic, which provide you with detailed information and suggested actions when investing in new equipment and improving the system as a whole. Use these Guides to help you identify prioritised targets and actions to unlock savings through equipment replacement and process consolidation in your business. This will assist you to develop and act on your energy plan.

 PACIA energy+ 5 Minute Guide 3.1  PACIA energy+ 5 Minute Guide 3.2
5 Minute Guide 3.1
Key considerations to maximise the energy efficiency of new equipment purchases
[1.4MB]		 5 Minute Guide 3.2
Upgrading your equipment and processes to improve
energy efficiency
[2.2MB]


Additional resources

The following external resources relate specifically to this topic, and supplement the information provided in the PACIA energy+ 5 Minute Guides above.

  • Tax support for small investments: The Australian Tax Office provides information on small business instant asset tax write-offs, which may apply to purchases of new equipment such as pumps and compressors

  • Payback calculator: a number of these tools are available online, such as the WEG payback calculator for variable speed drives

  • Building the business case: There are many resources available on the web to help you measure the payback, an important part of building the business case. One example is EPA Victoria’s Calculating the Payback guide

  • Energy performance standards for equipment: The Australian Government’s E3 Equipment Energy Efficiency program sets out energy rating labels and standards for new equipment

Did you know?

Annual savings far outweigh purchase premium 

Consider the following: Choosing a slightly more efficient motor might involve a purchase premium of $300 – but it will deliver a saving of nearly $500 in electricity costs in the first year alone. The total savings could be $7,350 over the 15 year life of the motor. That represents a payback of around eight months.

Review of systems saves Huntsman Polyurethanes energy and money

For medium sized chemicals manufacturer Huntsman Polyurethane ANZ, excellent energy savings were found by reviewing some of the systems used around the plant and broader business. One initiative involved turning on a product line freezer at night instead of during the day to avoid wasteful interruptions. The team also identified that products could be shipped directly to customers, reducing carbon emissions. Read more about this case study.