Saving Costs, Saving the Planet: Covestro Wins with Energy Management and Sustainability
Challenges rarely come from just one direction. Like many businesses Covestro, a worldwide leader in polymer production, has been beset by industry, regional, infrastructure, and operational challenges. Despite these, Dr. Felix Hanisch, Covestro’s Head of Process Control Technology, showed attendees at the 2016 EMEA Users Conference how the PI System can help chemical process companies realize huge cost savings and produce significant environmental benefits.
Constraints in a Diminishing Market
Formerly part of Bayer, Covestro was divested into an independent entity in September 2015. With approximately 16,000 employees, 10,000 products, and €12 billion in annual sales, the company has had to deal with the typical issues of a startup company and the unique challenges that come with inheriting systems, policies, and procedures from a multi-faceted parent company.
The company is also facing both common industry challenges and the unique challenges of the European chemical market. Chemical plants are large capital assets with long lives – they can last 30 years. “Covestro has assets worth ... the GDP of a small nation,” said Dr. Hanisch. Because of the inherent dangers in the chemical industry and the longevity of plants there are physical limitations on innovation and systemic change is difficult. Supply chain changes are also problematic. “Production processes are highly networked and mingled,” explained Dr. Hanisch. There are transportation restriction regulating when, how, and if materials can be shipped, a scarcity of suppliers, and the manufacturing base has been steadily migrating away from Europe. As Dr. Hanisch said, all of this means “you can’t swap suppliers just because you’ve found someone cheaper elsewhere”. At the same time European regulations are increasing, European market share is shrinking, and the industry is changing with customers demanding increasingly complex and sustainable products.
“We can’t just relax and say well the entry hurdles to all markets are so high I’ll just keep doing what I have been doing,” said Dr. Hanisch. “Especially when we look at the Chemical industry in Europe.” The global chemical market share for Europe has been reduced “from 33% to 19% in the last 15 years and it’s predicted to go down further according to Roland Berger with assets moving to the Far East, Middle East, and Gulf Region,” said Dr. Hanisch.
It’s all about Data … Context … Action!
To address these challenges, Covestro has focused on improving operations in three areas: safety, reducing costs, and improving quality. As, Dr. Hanisch said, “Number 1 is always safety. Anything that helps and supports to make the plants run safe is appreciated. At the same time we need to reduce costs ... and one way to get more out of the plants without building new plants is to make sure you get more quality product out of the existing asset.” But those improvements must also keep sustainability in mind. As Dr. Hanisch explained, “At Covestro it’s all around people, planet, profit and we don’t only look our operations, our supply chain, our own production units, and how we ship the product but also what’s being done with the product and what’s the end of use concept for those products.”
During his talk, Dr. Hanisch urged chemical companies to develop their digital strategies along two axes: vertical integration and B2B integration. According to Dr. Hanisch, the focus for vertical integration should be on making the right data available to the right people within the enterprise so they can make better decisions. While the focus for B2B integration should be on sharing data with suppliers and customers in the value chain to “come up with better ideas [and] better service concepts.”
With this holistic focus on process and information improvement, Dr. Hanisch stressed the need for actionable information which can be quickly delivered throughout the enterprise. For Covestro, the PI System is a key part of the solution. Initially, Covestro leveraged many different systems to collect and manage data, but over time they standardized on the PI System and in 2007 signed an Enterprise Agreement with OSIsoft. With this foundation in place Covestro is better leveraging information and proactively affecting their bottom line.
Monitoring + Feedback Loop = Reduced Energy Use & Emissions
One example of this is STRUCTese, Covestro’s three-tiered energy management system. In the first tier, an energy efficiency check aggregates PI System data from all the production plants and delivers it for analysis to process expert and operators who identify potential places to save energy through small modifications, large investments, or by changing how the plant runs. From this, Dr. Hanisch explained that Covestro gets “a clearly prioritized project portfolio that we can then steer our investment budgets with and make sure the most promising projects are done.” The second tier is an online monitoring tool for operators. It leverages PI ProcessBook and visually shows – minute by minute – if operators are running in spec and how energy efficiency can be improved for the plant. In the third tier, energy and production data for all plants is standardized – regardless of plant type and process variations – so management can compare, plant by plant, primary energy use per ton of product produced. “There’s no hide and seek anymore,” said Dr. Hanisch.
These changes aren’t just improving access to information, they’re affecting Covestro’s bottom line. In 2009, STRUCTese was certified as an energy management system in Europe, which, as Dr. Hanisch said, entitles the company to receive large tax rebates. In addition, Covestro has:
- increased production.
- reduced energy consumption by 30% since 2005 and expects to achieve a 50% reduction by 2030.
- reduced CO2 emissions 39% per ton of product produced since 2005 and expects to achieve a 50% reduction by 2025.
Hanisch, Felix. PI in the Sky: What Cloud Computing, Big Data and I4.0 Mean for the Process Industry. OSIsoft.com. 27 September 2016. Web. 01 January 2017. https://resources.osisoft.com/Presentations/Keynote---PI-in-the-Sky--What-Cloud-Computing--Big-Data-and-I4-0-Mean-for-the-Process-Industry/