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Energy: Intensive

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Alternative energy is a hot, hot topic. While the U.S. energy mix still relies heavily on traditional sources like coal, natural gas, petroleum, hydroelectric and nuclear, renewables like solar, wind and biomass are making inroads into electricity generation. The countrys unofficial energy policy can easily be referred to as all of the above.

Still, homemade electricity is a relative rarity in the commercial or industrial landscape, and it is costly to get up and running. This leads many manufacturers to view the leap into alternative energies as risky. To overcome some of these objections, various municipal, state and federal agencies have offered incentives to encourage early adoption.

Three lubricant companies – Ultrachem, Croda and South Atlantic Services – have found that extra push helped tip the decision in favor of alternate energy. Each now boasts solar capability in their operations, and one is also completing an ambitious project to generate its electricity from waste landfill gas.

LubesnGreases talked to each of these about why they took the leap, the costs and the payback. The benefits, we heard, include an attractive return on investment, financial incentives, an easing of energy cost volatility – and bragging rights for themselves and their employees.

Sunny in Delaware

Ultrachem Inc. is an independent specialty lubricant compounder approaching its 50th anniversary. Privately held since 1984 by a group of key employees, Ultrachem supplies OEMs and the industrial maintenance markets, and has been heavily into synthetic lubricants since opening its doors in 1965. Major product lines include synthetic compressor oils, industrial hydraulic and gear oils, lubricants for the food processing industry, and private-label products.

Last May, Ultrachem announced that it would install a 185 kilowatt solar photovoltaic system on the roof of its manufacturing plant and headquarters in New Castle, Del. The now-complete system generates enough electricity to serve its annual needs with power to spare.

Robert Whiting, president, and Glenn Krasley, director of sales and marketing, said they had been thinking about going green for two to three years before making the move. They found their opportunity in a state pilot program that promotes the purchase, installation and use of solar cells, the Delaware Solar Renewable Energy Certificate.

Ultrachem would have to follow strict program guidelines, Krasley observed, but the chance to create almost 200,000 kilowatt-hours a year of green electric power was tempting. The rooftop installations photovoltaic panels would be manufactured by Delaware-based Motec Panels and guaranteed for 20 years. And weather patterns for the past 15 to 20 years conservatively showed that solar is a good choice for their location, said Whiting. Beyond the green appeal there were tax incentives, too, which proved to be the deciding factor.

Some 770 individual solar panels now cover Ultrachems plant roof, which is free of interfering buildings that could cast energy-robbing shadows. Whiting noted that all of Ultrachems electrical requirements are satisfied with the solar array, and excess electricity is sold to the local grid at retail rates. The project is interconnected to the New Castle Municipal Services Commission utility system.

Krasley remains enthused about the project. Whenever industry can reduce environmental impact, its contributing to the betterment of the entire planet, he said proudly. Sustainability should not just be a buzz word that you can tell your customers about. It needs to have real value and contribute to reducing your overall carbon footprint.

When you implement a sustainability program, it must start from the top and your entire organization needs to embrace the commitment. It should also include your supply chain. Once your employees begin to understand the impact and value, youll be amazed how the ideas start flowing for additional ways to reduce waste and conserve energy. Thats why we feel its so important to share our success with anyone who is considering an energy conservation or reduction program.

Tapping into Trash

Atlas Point, Del., home to Croda Inc.s synthetic esters plant, is where this company has chosen to install a landfill gas-to-power project. Croda, an international chemicals company headquartered in the United Kingdom with operations in 34 countries, has been aggressive in its pursuit of sustainability, including the use of renewable energies such as solar, wind and now biomass power.

Croda put a solar array atop its U.S. headquarters in Edison, N.J., in 2011, but the landfill gas project would prove far more complex and ambitious. Robert Stewart, Atlas Points site manager, shared some information about the project, which broke ground last June and was completed at year end.

The plant, he noted, is located about three and a half miles from the Cherry Island landfill, which is owned by the Delaware Solid Waste Authority. This made it convenient for Croda, since many landfill sites are too far removed to be practical. The reclaimed landfill gas, methane, is delivered to Atlas Point via a pipeline, and burned in a 2.2-megawatt combined-heat-and-power generator made by Cummins Power Generation.

Croda put $5.5 million into the project, and received a $500,000 grant from the Delaware Energy Efficiency Investment Fund, for a total investment of $6 million. Crodas president, Kevin Gallagher, estimated that the project will pay for itself in five to six years.

Already, the site is burning methane to fuel its boiler system and generate up to half of Atlas Points steam requirement, and soon will begin producing electricity as well. At full load, the Cummins engine will supply up to 75 percent of the plants electricity, or the energy equivalent of 3,500 homes. Croda is still working through the process of hooking up to the local grid, and hopes to be completely on line next month.

Stewart cited a number of benefits to the landfill gas system. Its a renewable source of energy for the site for the next 20 years, which fits Crodas corporate goal of generating 25 percent of the companys energy usage from non-fossil fuels by 2015, he explained. It provides a predictable and efficient source of power – both steam and electricity – at a lower cost. The site also will earn production tax credits equivalent to 1.1 cents per kWh generated.

Reduced emissions are another benefit; previously the methane gas was flared at the landfill site but now its a valuable resource. The landfill will be active for a long time, Stewart added. Currently the estimate is that theres about 35 years of usable methane gas available. And as the areas which are currently active are covered, the gas generated could last much longer.

Founded in 1971, South Atlantic Services Inc. in Wilmington, N.C., aims to be one of the top contract packagers in the country. In addition to automotive and commercial lubricants, it supplies antifreeze, diesel exhaust fluid, dry chemicals, cleaners and agricultural products. SAS services some very large customers, and must meet their diverse packaging requirements, delivery schedules and quality specifications in a cost-effective manner.

Frank Hamilton III, president, and Jeff Grizzle, operations vice president, shared some insights into their decision to go solar. For Hamilton, the decision was prompted by financial considerations, which included incentives from the state (North Carolina offers a hefty tax credit) and the federal government. Plus, the roof of SASs warehouse was an under-utilized asset which could be improved by the addition of a solar array which is essentially maintenance-free.

Thirty-five thousand square feet of that roof now sport a 500 kW solar energy system. The 2,033 panels are clamped directly to the standing-seam metal roof, so as not to penetrate its surface. Local workers installed the panels, and the project was managed by United Renewable Energy, a contractor with offices in Winston Salem, N.C. Hamilton pegged the investment at roughly $1.4 million.

Hamilton and Grizzle noted that SAS does not use the electricity it generates but sells it all to the local utility, Duke Energy. This brings in significant revenue, as the solar array creates enough power to supply the electrical needs of 50 homes. If kept in-house, the electricity would meet one-third of the SASs power needs.

There are some intangibles associated with the installation as well, Hamilton pointed out. One is that the panels may actually extend the life of the roof. The project may also be of interest to customers who are supportive of green initiatives. Retail giant Wal-Mart, for example, is strongly interested in reducing its carbon footprint and encourages all its suppliers to follow suit.

Each of these companies emphasized that the use of green energy has enabled them to gain favorable tax credits and incentives from local, state and federal governments. This has given them early payouts for their investment and the promise of more stable energy costs into the future.

Each chose a different path for the energy gained, channeling it either to reduce their costs or to gain revenue. In addition they have chosen different energy sources.

And happily, all three point out, green energy is a useful tool for their sales force to gain favorable attention from their customers.

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