Improving the bottom line of a pharmaceutical manufacturing company is trickier than in most other industries. Pharmaceutical manufacturers are faced with several different cost pressures: improved margins, patent expirations, generic drug competition, significant R&D investment to stay competitive, etc. If not managed properly, any of these could severely hurt the bottom line and potentially put a pharmaceutical manufacturing company out of business. Therefore, it is essential to find strategic ways to alleviate these pressures and protect revenue – without compromising time to market or product quality.
One strategic way to achieve this is through energy management – more specifically “active” energy management. Yes, the energy challenges are the same in all industries – the cost of energy is rising and sources are becoming scarcer. But for a pharmaceutical manufacturing plant, investing in energy management not only presents a huge cost savings opportunity, it also presents a way for executives to offset cost pressures that aren’t a factor in other industries.
Passive vs. Active
Why is “active” energy management so important? Because, this is where you fully realize your energy efficiency potential – and this is how you reap long-term savings benefits. Pharmaceutical manufacturing plants spend an average of $1 billion in energy consumption each year, the majority of that due to HVAC systems. Following this approach, a savings of up to 30% can be achieved.
This process follows a 4-step lifecycle approach:
1. Energy Audit & Measure
2. Fix the Basics
3. Optimize through Automation & Regulation
4. Monitor, Maintain, Improve
Step 1 is passive energy efficiency (basic energy efficiency fixes such as switching to high efficiency motors or lighting). Steps 2 – 4 are active energy efficiency (continuous measurement, monitoring, and control of energy usage). The full lifecycle of this process significantly reduces energy consumption, which improves operational expenses. To dive a bit deeper, I recommend reading this informative white paper, published by Schneider Electric.
Pharmaceutical Manufacturing & Active Energy Management
Environmental control protects product quality – the core of strict regulatory compliance standards in the pharmaceutical manufacturing world. The operation of a pharmaceutical manufacturing plant depends on maintaining specific temperature and humidity settings. Implementing 24/7 environmental monitoring ensures that the required settings are always maintained So, although regulatory compliance is not dependent upon energy efficiency, investing in it can be a catalyst to achieving it.
In addition, continuously maintaining these settings often results in an abundance of energy wasted, which equals money wasted. Through proper measuring and auditing this waste can be safely eliminated.
Regular equipment maintenance usually means lower repair costs as well as significant energy efficiency benefits. Yet, most companies conduct maintenance annually at best.
Motor management is key in a pharmaceutical manufacturing plant. Motors power the HVAC systems, and consume 60% to 70% of the electrical energy. To maximize motor efficiency, the motor system should be evaluated “as a wholes’ (pumps, compressors, motors, and fans) rather than as separate components. A strategic motor management policy can help reduce energy consumption from 2% to 30%.
Air must be filtered, treated, and conditioned to specific temperature and humidity settings to avoid product quality issues. As such, it’s not uncommon to find air flow rates set higher than required – causing energy waste. This waste and can be avoided by controlling the motor speed with variable speed drives (VSD) and a building management system (BMS).
Pharmaceutical manufacturing plants use compressed air when spray coating or packaging, which comes into contact with the product and if not filtered to meet standards, can alter product quality. These systems, with only 10% electrical conversion efficiency, are among the least energy efficient systems in a pharmaceutical manufacturing plant. Compressed air should be used in strict moderation – turned off when not needed or replaced for a higher efficiency compressor. Reducing energy consumption in the compressed air system is inexpensive and can result in savings from the total electricity consumption of up to 50%.
Some additional active energy management measures include using VSDs in pumping systems, occupancy monitoring through presence detectors & CO2 monitors, and power quality correction to reduce energy loss. Here is a really good article from PharmTech, which identifies more energy savings opportunities.
Adding Up the Benefits
As long as we’re faced with the world’s energy dilemma, the cost to pharmaceutical manufacturing companies will rise. Through an active energy management approach, up to 30% cost savings can be realized – and with proper monitoring and maintenance, an 8% loss of that savings can be avoided.
Budgets are tight, which means resources are limited. With an active energy management investment, you have a round-the-clock, reliable resource – reducing the need to invest in additional staff.
Becoming a good corporate citizen has its cost benefits as well. According to the Dow Jones Sustainability Index, “the annual share performance of sustainability leaders exceeded that of sustainability laggards by 1.48 percentage points during the period 2001-2008.”
Let’s not forget, as environmental government policies come forth, so will additional costs. One example is the implementation of carbon taxation. China is already considering a carbon dioxide emissions tax, according to a recent article from Bloomberg Businessweek. This is sure to spark a government trend across the globe.
And finally, it goes without saying, noncompliance of regulatory standards can result in millions in revenue loss. The savings achieved through active energy management can be reinvested in other areas of cost concern – including ensuring regulatory compliance.
Active energy management is essential for pharmaceutical manufacturing plants to take full advantage of their energy efficiency potential, maximize their cost savings, and sustain the benefits over the long term.
How is your pharmaceutical manufacturing plant addressing this multimillion dollar issue?