Reducing the carbon footprint is one of the many benefits of lean manufacturing, and the U.S. Department of Energy recently announced it will be increasing its efforts to aid the manufacturing industry in moving toward greener, more energy-efficient operations. The main reason behind the Clean Energy Manufacturing Initiative (CEMI) expansion is to help strengthen the business sector, which has been on the rise for the past few years, but original equipment manufacturers (OEMs) will likely see numerous other benefits of the DOE's latest offering as a result.
How will the initiative benefit the industry?
The CEMI was introduced in March 2013 to aid the manufacturing industry in becoming more competitive on a global scale, in part by focusing on the production of clean energy technology, but also by making all sectors of the industry more energy efficient. The DOE originally promised to provide support in terms of upgrading facilities, researching new clean-energy technologies and reducing the cost of developing these offerings.
"In part due to a dramatic increase in domestic energy production and the Obama administration's policies and support, the U.S. manufacturing sector has seen a resurgence in recent years, adding 700,000 jobs since 2009," Energy Secretary Ernest Moniz said in a release. "Continued smart investments in advanced manufacturing technologies, and the American workforce today, will strengthen our competitive edge for decades to come."
The DOE's recently announced expansion to the CEMI included the partnership of two organizations, the Council on Competitiveness and the Alliance to Save Energy, which will work together to strategize ways to meet President Barack Obama's goal of doubling energy efficiency by 2030. In addition to committing $23 million in funding for 12 different projects, the DOE is working to recruit more manufacturers into the Better Plants Program, which requires participants to reduce their energy expenditure by 25 percent within a 10-year period.
How will these efforts affect OEMs?
Primarily, making the switch from older equipment to more energy-efficient technologies can help reduce OEMs' carbon footprints, and at the same time it will also free up a significant amount of funds. The DOE reported that it costs $200 billion annually for manufacturers across the nation to power their factories. Around 140 companies operating about 2,300 facilities have already made changes to reduce energy consumption, with the help of the Better Plants Program, and have saved $1.7 billion collectively over a four-year period.
These improvements are intended to make domestic manufacturing companies more competitive with the rest of the world. According to Natural Gas Intelligence, the manufacturing sector has seen roughly double the growth of the U.S. economy as a whole since the end of the recession, and the CEMI is set to help fuel that growth into the future.
What additional benefits will OEMs see from this shift?
When OEMs become more energy efficient, they will likely see numerous improvements. The cost efficient manufacturing practice can help save funds that will then be able to go toward other projects. There may be initial costs associated with transitioning the factory to new, greener equipment and practices, but they will be recouped through long-term benefits, such as more efficient production, lower operational costs and even better client retention. Making clean-energy efforts can help strengthen an OEM's brand and give it an edge over the competition, making it more appealing to consumers and driving business.