If there was any manufacturing shop anywhere that wasn't looking to cut operating costs, you may be sure there isn't one any longer. Cost cutting is standard operating practice. And, as with any practice, there are benchmarks. Some shops will cut costs more effectively than others.

When it comes to cost-cutting performance, there are really only two approaches: cost cutting, and smart cost cutting. Shops and plants that take the first approach set a goal, say 15%, and work to reach that target. It can be a reckless process that doesn't account for the cost of cost cutting.

Operations that take the smart approach monitor, categorize, and evaluate costs, so that when decisions about cuts are made there is a complete understanding of the impact as well as the savings.

Depending on the operation, monitoring can be done in almost any category of cost, e.g., purchasing, or maintenance. But, energy-cost monitoring should be adopted by any shop or plant, as the first step toward energy management. John Harrison, a Senior Solution Architect with SAP Canada, created a checklist that shops can use to simplify the task of managing energy usage.

For example, operations that use gas-powered vehicles should be certain that these receive regular maintenance and checkups; that tires are properly inflated; oil changes are conducted regularly; and unnecessary extra weight is removed from the vehicle.

A similar holistic approach should be taken with natural-gas heating systems. Furnace or heating chamber walls and doors should be insulated to minimize heat loss, and to keep temperatures low outside on the outside surfaces of the equipment. Water-cooled parts should be reduced or eliminated inside the chamber, or if they are necessary then they should be well insulated to reduce heat transfer. Heat-transfer surfaces should be cleaned frequently, to maintain high heat-transfer efficiency in heat exchangers and other systems that use electrical elements, coils, or radiant tubes.

This approach increases in detail according to the specific facility. Reducing energy consumption is an ongoing effort, but one that will be more manageable if shop operators keep a watchful eye on equipment performance.

Logically, a cost-saving program focused on energy should be expanded to cover all plant system, to determine changes in performance over time, and versus industry standards. Industry standards are available for motor systems, hydraulics, insulation, air power, and steam, among others, including energy-purchasing methods.

Such extensive measuring and tracking is made easier with energy-management software programs, of which there are numerous offerings. One of the latest is the Quick Plant Energy Profiler, v. 2.0, an online software tool that plant personnel can use to diagnose quickly how energy is being used, and to identify the best opportunities for savings. It was developed by the U.S. Dept. of Energy Industrial Technologies Program.

It's designed so that users can create their own plan profile, and use it to provide rough estimates of performance. Quick PEP diagnoses the overall energy picture at a location, and presents a plan for further investigation. The results will help plant operators to focus on improving the performance of their energy-consuming systems.