Data is the key to sustainability in 2024
With an ESG Summit on the first day of Automation Fair, repeated references across keynotes along with both a large, dedicated area and a variety of sustainability related exhibits from both Rockwell and its partners on the exhibition floor delivering solutions to address the manufacturing sectors contribution to climate change was pervasive.
At the ESG Summit speakers covered the current state of industrial sustainability, the role of technology in addressing the challenges manufacturers are facing in their transformation, and the factors that are likely to accelerate the transition.
Sustainability starts with data As companies continue efforts to move to net zero, decarbonizing energy supplies can’t be the sole goal. Manufacturers must prioritize a focus on energy efficiency. To do this companies need to have data, to set a benchmark, to report performance and also to optimize processes, and there was a clear theme through the presentations in the role of technology in enabling this.
Tom O’Reilly VP, Sustainability at Rockwell Automation quoted a Rockwell Automation survey in which 96% of respondents rated digital as important to sustainability improvements with 45% indicated it was vital.
In leveraging technology companies can start to get visibility of the overall impact of projects to a company’s overall sustainability goals.
Digitization and sustainability go hand in hand Andrea Ruotolo, Global Head of Customer Sustainability at Rockwell Automation, emphasized that digital transformation would go hand in hand with the transition to sustainability and that sustainability should both be embedded across an organization but also integrated to support a holistic overview of the impact of efforts on the business.
In integrating these different data sets companies can see not just the sustainability impact, but also the implication to a business, as reinforced by Andy Kohok, Managing Director at Accenture. “Key performance indicators (KPIs) have to be merged between business operations and sustainability to realize the positive and negative impacts—only then can you make the right decisions. The assembly line that’s making product is also impacting carbon emissions, water and energy use.”*
"Key performance indicators (KPIs) have to be merged between business operations and sustainability to realize the positive and negative impacts—only then can you make the right decisions."
Manufacturers won’t be able to ignore the need to operate more sustainably. “Sustainability reports will be as important as financial reports,” emphasized O’Reilly who referenced incoming reporting regulations such as the EU’s Corporate Sustainability Reporting Directive (CSRD), requiring any companies with turnover of more than Euro 150 million selling into the EU to report their scope 1 and scope 2 emissions in 2025. Beyond reporting, companies “will have to have goals and show year on year progress, starting in 2025.”
"Sustainability reports will be as important as financial reports."
The aforementioned role of digital transformation can accelerate progress to sustainability goals across different business functions. In design, Rodrigo Alves Manager, Sustainability & Energy Management Business EMEA, at Kalypso (a Rockwell Automation Business), explained how CAD and PLM tools can be enhanced with digital solutions to speed up the introduction of new products to market, considering substitution of raw materials, the impact in a circular economy and, within PLM, conducting lifecycle assessments (LCAs).
Alves emphasized how utilizing machine learning, customers can “dispatch different energy sources across the day based on tariffs and availability of solar energy” to optimize both the use and sustainability of energy.
FactoryTalk Energy Manager launched At the event, Rockwell showcased FactoryTalk Energy Manager, an extension to Rockwell’s FactoryTalk Software targeted at helping customers with enabling faster data-driven energy savings and identification of losses. This has been released the week before. The tool can integrate energy data with production data, such as from the MES or PLC, to understand the energy consumption footprint of a machine and identifying if it’s underperforming. This can support both with saving energy but also influence production scheduling.
The integration of these technologies and aligning with sustainability is a challenge for many companies, who are not just facing a workforce shortage but also competing for talent for both digital transformation and sustainability skillsets. Alves highlighted the resources available to customers through consulting services that can help with audits, design and implementation of process savings, and better integration of other energy sources.
To further augment the rapidly growing Kalypso business, Rockwell acquired Knowledge Lens, which offers applications supporting carbon accounting and emissions monitoring, alongside digital consulting.
Business models for sustainability The concepts to transition to net-zero are not just about new technology. One company that stood out leveraging an innovative business model was Energy Drive. James Hynd (CEO of Energy Drive) explained how the company has introduced an Energy Savings as a Services (eSaaS) model. Energy Drive works with a company’s rotating assets, introducing large variable frequency drives (VFDs) to reduce energy consumption (and therefore also emission). There’s no CapEx / upfront cost for the customer, rather Energy Drive is paid on the amount of energy a customer saves. Energy Drive leverages their domain expertise on the processes, conducting analytics to optimize the usage of the motor. For one partner (Sibanye-Stillwater gold mining in South Africa) Energy Drive was able to optimize the ventilation system of a mine, by having two fans directly coupled to two induction motors as opposed to the established practice of running one fan at a time. This approach enabled Sibanye-Stillwater to make 62% savings in energy in the first shaft and a further 48% in the second.
*Source: https://www.controlglobal.com/sponsored-content/article/33014493/the-intersection-of-sustainability-and-productivity
The full house at the ESG summit, emphasized the growing interest Rockwell clients are placing on understanding and improving their environmental footprint. This reflects the growing attention and commitments across the manufacturing sector. In the first six months of 2023, the number of manufacturers having committed to Science Based Targets Initiatives (SBTis) for emissions reduction, increased by 40%.
Efficiency is not an alternative to decarbonization The also show some progress, for example: for manufacturing companies renewables energy as a proportion of total energy has grown from 14% to 20% between 2019 and 2022, and almost two thirds of manufacturing companies expect sustainability budgets to increase over the next 12 months.
However, in terms of the real impact the changes are still not where they should be whilst it’s encouraging that more companies are looking to invest, only a quarter of companies expect to increase budget by more than 10%.
And although renewable energy use is increasing this hasn’t yet resulted in a reduction in the use of fossil fuels. Companies aren’t going to be able to just decarbonize their energy, a dedicated effort in reduce energy consumption through efficiency efforts will also be paramount.
For many companies this will require efforts with digital Transformation and sustainability to go hand in hand, which will require companies getting a handle of their data to move their energy management from basic to best practice and will be critical not just for internal monitoring, but for the reporting to comply with forthcoming legislation, as well as for optimizing processes and products to be more sustainable. The graphic below identifies six areas for energy management and the end goal in terms of best practices to enable improved energy efficiency.
Test you energy management maturitySide note: companies interested in understanding their current level of maturity can complete the Energy Maturity Assessment. This tool will help industrial companies to compare their practices to their industry peers and provides access to a whitepaper on moving from basic to best in class.
The launch of FactoryTalk Energy Manager will offer manufacturers with improved visibility of the energy profile across a manufacturing process as well as the ability to optimize some of these process through the application of analytics. The challenge moving forward will be how it can integrate this data with other systems across the manufacturing to give a holistic view of the impact of changes across business functions and KPIs to augment decision-making efforts. Whilst many technology vendors are introducing some variant of a digital thread approach across an organization, providing some robust real-world examples of success will be important for Rockwell to clearly articulate and reinforce to customers the connection between sustainability and business success.
