Finding and Implementing Energy Efficiency Projects in Industrial Facilities

S. AFLAKI, P. Kleindorfer, V. Sáenz de Miera Polvorinos

Production and Operations Management

May-June 2013, vol. 22, n°3, pp.503-517

Departments: Information Systems and Operations Management, GREGHEC (CNRS)

Keywords: Sustainable operations, Energy efficiency, Kaizen, Carbon footprinting

This study addresses the challenges of finding and implementing profitable energy efficiency (EE) projects, a critical foundation for sustainable operations. We focus on manufacturing enterprises, but many of our findings apply also to the back office of service operations. Our starting point is that, in nearly every industrial enterprise, there are many profitable EE projects that could be implemented but are not. An oft-cited hindrance to implementation is the lack of an internal management framework in which to find, value, and execute these projects. Using a conceptual approach, we rely on proven sustainable operations tools to develop such a framework. We identify three major value drivers of EE projects: savings intensity, 'green' image, and project complexity. We then describe a framework for understanding the context of EE projects in industry, with an underlying analytic foundation in optimal portfolio analysis. A case study of a large manufacturing site is used to illustrate emerging best practices'based on Kaizen management principles'for integrating EE project management with operations, engineering, and strategy