Adding up the cost of compressed air

25 February, 2016

If you have a KPI to reduce the cost of energy in your manufacturing facility, you need to look at the cost of compressed air for pneumatics. Most of us will know this. Yet many of us struggle to fulfil our energy saving KPIs. A 5-10 per cent reduction in energy spend is a big ask.

As a manufacturer ourselves we’ve tried a lot of different strategies. We work with many other leading manufacturers and there’s one thing that we’ve found. Saving costs on compressed air is difficult. Here are some reasons why.

1. We don’t know what air costs

We don’t know the cost of compressed air – it’s a free resource after all. With the cost of electricity nearly doubling over 12 years, and electricity consumption being 60 to 70 per cent of the total cost, compressed air is actually a highly expensive resource. Then we look at the wastage and recognise that we’re literally blowing money away.

These are great headline figures and get us all excited about fixing leaks in compressed air systems. We’ve seen the European Reports that show that 42% of the cost of compressed air is lost in leakages.

That’s when we commission leak identification reports.

2. Fixing leaks doesn’t work

This is one fact that few people recognise. Fixing an air leak alone does not reduce costs. We’ve tried it in Festo’s own manufacturing facilities. We’ve identified the leaks. We’ve fixed the leaks and it’s saved us little or nothing.

Let’s use an analogy that everyone knows. If you’re having a morning shower and your partner turns on the kitchen tap downstairs, the pressure tends to drop (at least it does in my old shower). Fix the leak from the kitchen tap and the pressure returns to normal in the shower. You haven’t saved any costs because the amount of water coming out is still the same.

The other point is that often leaks aren’t fixed at all. It’s not unusual when training on pneumatic systems that we’ll see tags identifying leaks that are still there years after being marked. That’s the real crux of the issue.

3. Your team doesn’t care about compressed air

No costs are being saved, because no one cares. We call this unconscious incompetence. Your engineers, operators, maintenance staff or the many other people who walk past leaks, poorly designed or maintained machinery day after day, don’t see this as part of their job.

I’ll take you back to another domestic situation. When I was a boy my father would always get on at me about turning off the light in my room. I didn’t. Now I have a go at my children when they leave the TV on standby, their phone in charging, computers left on. They don’t care. That’s because they don’t pay the bills. They have absolutely no idea about the real cost of what they’re using.

It’s the same in a manufacturing plant. Air is a free resource; so understanding that compressed air is an expense doesn’t occur to most people. It might be the fourth utility but it’s the one that’s always forgotten.

Until you add a KPI to reduce energy consumption to the Balanced Score Card of every employee, it’s unlikely that they will take responsibility. If they know that something needs to be done and they’re being measured on it, you could find that they then become consciously incompetent – at least that’s a small improvement. They might start to be part of the cure rather than the cause.

To make any significant change you have to change the culture of the organisation. It’s only by every person being responsible that substantive savings can really be made.

Education is the key

The key to this is education. Part of this education means they need to see what can be achieved to believe it can be done. It’s about turning the invisible resource of air into a visible asset and showing viable ways to reduce costs. That’s when you’ll make serious savings and hit your KPIs to reduce the cost of your energy.

www.festo-didactic.co.uk/eee