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Facing the future of carbon with sustainability

The recent Garnaut Report and National Greenhouse Energy Reporting (NGER) scheme have laid the foundation to combat climate change in Australia. Corporations registered under the NGER scheme are required to report greenhouse gas emissions and energy consumption.

The data collected will reflect the total emissions from two principal categories:

  • Scope 1: Greenhouse gases emitted into the atmosphere as a result of a corporation?s activities.
  • Scope 2: Emissions generated for the consumption of electricity, heating, cooling or steam at the facility but produced by external sources.

The carbon price calculation will be based on the NGER data submitted via the scheme?s Online System for Comprehensive Activity Reporting ? NGER Reporting Tool (OSCAR) system.

The recently released Green Energy Future Plan has provided some clarity for industry to mitigate the business impact of such legislation. The key elements of the plan include:

  1. Introduction of the $23 per tonne carbon tax on 500 of the biggest polluters starting on 1 July 2012, followed by an emissions trading scheme in 2015.
  2. Promotion of investment in innovative renewal energy to the tune of $13 billion.
  3. Further encouragement of energy efficiency through the $1.2 billion Clean Technology Program.
  4. Creating opportunities in the land sector to reduce pollution.

A new independent Climate Change Authority will be set up to monitor the progress of the carbon price mechanism and make recommendations to government.

To date, the NGER scheme has been driven largely by the need for compliance, rather than motivated by an improvement to the bottom line. The Aberdeen Group report1 concludes that compliance with current and future regulations is the top driver behind corporate focus on carbon management in the USA. In addition, cost reduction and achieving a competitive advantage are the primary drivers behind energy management programs.

{{image2-a:l-w:450}}The current legislative environment presents a major opportunity for senior management within the mining, energy and minerals sectors to develop integrated, sustainable plans for improving energy efficiency while mitigating the impact of the carbon price. In addition to meeting corporate business objectives, companies can become responsible members of the community, thereby enhancing their company brand and image.

However, NGER report generation can be cumbersome for many companies, as several disparate systems may exist which require manual manipulation, thus compromising data integrity. In response, companies implement energy management systems on an ad-hoc basis to monitor Scope 1 and 2 emissions.

This is further compounded by the level of resources committed to such programs and the shortage of staff with appropriate skills. Embedding contractors from automation companies can minimise the impact of total cost of ownership without comprising the level of skills required to facilitate the legislative requirements.

Integrating energy management as part of the overall automation and information strategy based on standardised processes and procedures can be scalable to accommodate future expansion. The ability to automate the interface with the OSCAR database would result in higher data quality and efficiency.

Predictive modelling of emissions allows for comparisons to be made against real-time data ? a valuable tool to validate, audit and maintain compliance with regulatory agencies. Many of the solutions available for this type of monitoring have the capability of distinguishing between Scope 1 and Scope 2 whilst meeting NGER standards.

Research by the Aberdeen Group1 and the ARC Advisory Group2 indicate that those companies that undertake energy management strategies are more likely to see rapid return on investments. In fact, the companies defined as Best in Class by the Aberdeen Group reported decreases in energy consumption of up to 15 per cent and emissions by 12 per cent.

Installing energy management systems to monitor emissions, energy consumption and points of wastage will enable companies to assess their current performance and establish benchmarks. Once current levels are established, real-time monitoring of the overall production facility allows data to be captured, analysed, stored and shared. With this knowledge, peak energy costs can be addressed, energy consumption optimised and productivity improved.

Effective energy management is more than just data collection. Initial analysis of energy usage throughout the plant, building historical records, establishing corporate targets and decision-making processes must be intrinsic to the overall strategy. The benefits of employing an energy management system will be evident relatively quickly as the efficiency of the company improves.

The key strategies identified by the Aberdeen Group for best in class corporations to facilitate improved energy management are:

  • Facility and production monitoring to understand where energy is being used.
  • Incorporating embedded energy as a raw material into bill of materials.
  • Identifying short-term quick fixes.
  • Storing data collected to build a historical reference.
  • Adapting energy consumption to maximise the cost-benefits available through off-peak rates, seasonal variations and load shedding.

There are several simple ways to modify production processes which quickly improve energy consumption. These include using appropriately sized compressors, variable speed drives and motors, changing heavy-load shifts to non-peak times, properly maintaining equipment and assets, and only procuring ingredients and components when they are needed. These ?quick fixes? have been shown by many industries to be worthwhile activities that required little capital investment and had instant effect on energy consumption and emission generation.

A significant proportion of emissions generated by a plant is created through the operations carried out on-site. For most mining applications, it will be based around contaminants trapped in water and air that are released to the environment through the extraction and processing of ore and minerals. Combustion of waste, fugitive methane release in coal mining, and flue emissions have been highlighted as significant contributors to greenhouse gases released under Scope 1.

Further improvements to energy management include the creation of alternative energy sources such as solar, wind or biofuels. The capture of methane as an alternative fuel source or as a fuel to create diesel from coal, represents additional options for many coal mine operators. Heat-recovery systems can be used by many industries as supplements for heating water and boilers. Many of these technologies are still in the initial stages of design, but will represent opportunities for companies to grow in new directions and not be confined to traditional business activities.

In a 2010 submission on Energy Efficiency Opportunities to the Federal Department of Resources, Energy and Tourism, one Australian coal mining company estimated that upgrading the SCADA system to provide real-time energy usage could potentially reduce engineering expenditure by 25 per cent to 30 per cent. A further improvement to the conveyor automation systems would have the potential to provide energy savings in the order of 1000 megawatt hours per year and lower emissions by approximately 1100 CO2eT per annum.

{{image3-a:l-w:450}} Plantwide automated systems for power and energy management, such as those available from Rockwell Automation, provide valuable tools to identify and optimise asset and energy use, including that outlined in the above example. The software for auditing and monitoring via dashboards, data historians and predictive modelling provide extensive visibility of energy usage and forecasting capabilities. With these strategic tools in place, along with establishing sound project management methodologies, the ability to optimise processes and holistically manage energy and carbon emissions is greatly enhanced. Training staff to raise awareness of sustainability further facilitates the energy and carbon management policies established by a company?s key stakeholders.

Coupled with process optimisation, intelligent motor control, asset management, power monitors, and improvements in devices such as variable frequency drives, compressors, chillers and burners, a company?s facilities are not only more sustainable but will be better able to manage, and consequently reduce, the levels of Scope 1 and 2 emissions.

As a corporation improves its sustainability policies to manage energy consumption and emissions, there will be opportunity to invest in the research and development of new technologies and skill sets. This may have the potential to increase, rather than decrease, employment levels as companies seek to lower the cost burdens associated with a lower carbon economy. Foreseeable roles may include emissions specialists, R&D and tradespeople to develop and install alternate energy sources and ?carbon accountants?, skilled in emissions trading and reporting.

Sustainability strategies need not be confined to larger plants, but are often scalable to mid-range enterprises. Using appropriate equipment for production facilities and integrating all the processes over a common platform, it is possible to maximise energy efficiency, minimise emissions, and become a sustainable enterprise, regardless of the organisation size.

Many mining companies have incorporated strategies to become sustainable and responsible corporate citizens. Mine site rehabilitation, water reclamation, and involvement in the indigenous community have been implemented for many years. Taken a step further, increasing the efficiency of a mining operation will not only lower the impact on the local environment, but will also lower emissions in accordance with evolving regulatory requirements.

Shareholders and consumers are now better able to gauge a company?s commitment to sustainability when making their decision to buy, based on the yearly sustainability report and ?scorecard? that often accompanies a company?s annual report. A buying decision based on responsible corporate citizenship is becoming a driving force for the environmentally conscious consumer.

It is imperative that business find a balance between strong financial outcomes and the responsibility to sustainable energy consumption and carbon emissions. Incorporating power and emissions monitoring tools into mining, energy or minerals processing plants, to facilitate sustainability, should be viewed as a long-term proposition and therefore be a part of a company?s overall strategy, where the rewards are more than regulatory compliance.

Michael Loke is the industry manager for sustainability with Rockwell Automation.


  1. Aberdeen Group. Carbon and Energy Management in Manufacturing Operations, 2010.
  2. ARC Advisory Group. Best Practices in Energy Management, 2009.

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