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OEM Report: Energy
Thursday | 19 March, 2009 | 5:30 am

Battling energy costs

By Modern Metals' staff

March 2009 - Metal casters require a lot of energy to run their businesses. As a result, the high cost of energy affects the industry directly. In an effort to help its members minimize these costs, the American Foundry Society, Schaumburg, Ill., launched a set of energy services as part of its Energy Solutions program.

AFS has partnered with TDI Consulting Inc., Lemont, Ill., a utility cost containment firm for electrical, natural gas, telecommunications, water and sewer expenses, to provide benefits for the organization's corporate members. The program includes services such as utility bill auditing, identifying refund opportunities, competitive rate assessments, advanced energy procurement assistance, contract reviews, electric conservation programs and alternative energy options.

A helping hand
Alfred Spada, director of marketing for AFS, says the organization was compelled to start the Energy Solutions program to offer its members something unique in the marketplace while helping them battle what he calls "a big problem."

"Our industry as a whole is extremely energy-intensive," says Spada. "We're taking metal and melting it down, so our furnaces use significant levels of energy. They aren't the most efficient machines in the world either. So we wanted to help our members who use a lot of energy but may not have a staff large enough to have an employee focus on things like that, whether it's electric costs, gas costs or any kind of utility costs. We wanted to help them with what's going on out on their shop floors, as well. For example, are they using the most advanced air compressors or the most energy-efficient motors? Those are the little things that can really add up in a large manufacturing operation."

Spada says the metal casting industry is composed of mostly small and midsized manufacturers, with 80 percent of companies employing fewer than 100 people.

"They don't have this kind of service on staff like bigger corporations do," he says. "So giving them a firm to turn to that can help them with these services is a great benefit. [The services] could save a company $2,000 a year or $50,000 a year. It differs from company to company. But the savings all go straight to the bottom line."

Money saved
TDI Consulting provides AFS corporate members with the knowledge and expertise to minimize costs and increase net profits from complex utility and telecommunication cost structures. It also assists members with energy procurement and conservation.

"TDI will help you walk through the plant floor and analyze places where you might be wasting energy with old machinery," says Spada. "On top of that, they'll also examine your utility bills and look for places where you're getting overcharged or where incorrect information is getting added to your bills. They'll help you negotiate what you should be getting in return funds from those utilities.

"TDI also helps you secure energy if you're in a deregulated state," he continues. "So if you have a variety of options for your energy, you can go to TDI, and they'll help you work through the different options and decide which is the best for your situation."

As a result of working with TDI, AFS members will benefit from reduced energy costs in numerous areas. A plant audit will identify any equipment that can be updated to become more energy-efficient. The price of changing equipment could be as low as $100 or as high as thousands of dollars, but TDI will recommend only upgrades that will give a company a payback within a certain amount of time. Cost savings can also come from the analysis of a company's utility bills. If TDI finds that a manufacturer is overpaying in a certain area, it will work with the utility companies to make sure the proper rate is issued.

"Energy prices have skyrocketed over the past few years, and many of our members aren't sure what to do about trying to stay competitive," says Spada. "As an association, it's our responsibility to respond to our members' needs and the industry's needs and help them in any way we can. They're all going to be big consumers of energy, so how can we help offset that a little bit? So we reached out to TDI to come in and provide these services so our members can increase their savings." MM

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