I was interviewed for an article regarding green factory facilities in China, it’s an extensive subject with few column inches and not limited to China. I listed more than 165 strategic methods for creating a green facilities, far too many to review in one article. Here is the link for the report your reference:
Green Facilities Becoming Reality in China
Savings in costs making sustainable China factories economically viable
by Ben Paul on Tue, 2010-08-10 19:57
Green facilities may be good for the planet, but they’re not easy to achieve. Many businesses that need to emphasise near-term cashflow may want to go green but end up settling for cheap and dirty. However, there are a number of options that can help companies be both environmentally sustainable and economically viable – especially for companies that can afford to think long-term. “You’d be surprised at the low-cost or no-cost opportunities I find just walking around in a factory,” John Herbert, founder of environmental consultancy Kelcroft E&M Limited said.
Of course, the greatest savings often come from making investments in making investments in design or technology that cuts resource use. However, as Herbert points out, there are important opportunities – both in building design and in outfitting – that can result in long-term savings for manufacturers setting up their plants in China.
RightSite talks with green industry experts about how to make such eco-friendly facilities sustainable for even the most frugal investors.
Given the benefits of eco-friendly buildings, it can be surprising that those elements have not been integrated into every factory. The prospect of delays caused by cost premiums, underdeveloped technology, and conservative ownership, however, may forestall adoption of even the most promising design improvements.
A business-owner might decide against a more eco-friendly facility because of the higher base costs. For firms constructing an environmentally-sustainable factory, the costs are typically 100 percent higher than for a building without such environmental features, according to Bernd Reitmeier, shareholder of the Startup Factory Incubator Project.
Even more conservative estimates suggest companies should expect to make a sizable investment.
It depends on how much technology is used,” Yan Zhu, Vice General Manager of Jiaxing CECIC Environmental Protection Technology Co. said. “Compared to normal plants, generally it adds 18 to 19 percent to the construction costs.”
This can cause hesitation whether the building company is building for themselves or intends to lease it. In the case of the Kunshan facility Reitmeier is supervising, rental rates are around 40 RMB/sqm/month – nearly three times more than a typical workshop.
Controlling Conservation Costs
Sustainability will cost more initially, but with the right planning such investments can pay off. For one, saving energy is rarely about buying expensive new equipment, but rather building in savings from the beginning of a project.
Thus, for companies preparing to build a factory, savings can be built into the facility itself. Stefan Rau, Group Executive Director of planning firm Metropolitan Synergies, said decisions as routine as the building’s orientation can have a huge impact on energy usage during the plant’s lifetime.
“Most factories have one air conditioning system and another system for floor ventilation,” Rau said. “But by building with…an aerodynamic design, you can create a system of natural ventilation.”
He also pointed to elements like installing skylights to reduce the need for artificial lighting, as well as building insulation layers into walls.
Markus Diem, Director of the Energy Department at MUDI, agrees that a building’s structure is often the most important element in increasing energy savings. With this in mind, he designed a recent project’s building as a closed ‘enveloping’ system to strictly regulate the amount of hot or cold air passing though.
“The most efficient part is the building envelope,” Diem said, “a big part of most buildings’ energy loss is that it literally goes right out the window.”
Energy savings are not just for businesses that can afford to custom-build a factory – there are also plenty of opportunities to outfit an existing production center.
Herbert said that in many plants he visits, the planning has been focused on the manufacturing process itself, without taking into account energy factors.
According to Herbert, a common case is when foreign companies from areas like the U.S. or Japan bring equipment over from their home plants, but find that the voltage is inappropriate for Chinese powers systems. As a result, many simply plug the machinery into transformers.
While this may offer a quick way fix to the problem, Herbert notes that, “right there you lose one to two percent of the energy just going through that.”
Instead, he said companies could invest in purchasing and training their staff on a new, China-made version of the equipment and eliminate the recurring costs.
Another place for savings is in boilers that produce steam. Herbert said in factories that use steam, the condensation can be collected and reused.
“It’s already chemically treated and already hot, so you don’t have to go through those processes again,” Herbert said. “Just through that a business can save two to three hundred thousand [renminbi] a month, and there’s no running cost.”
The benefits of energy-efficient production facilities extend beyond the factory itself: according to Diem, they can also be good for marketing.
“Green is fashionable right now to investors,” Diem said. “When I started this company five years ago it wasn’t so high in demand, but now everybody wants that as part of their building.” Products certified as made in sustainable settings are eligible to use certain advertising on their packaging that Herbert says attracts consumers and boosts the company’s image. “We get calls from companies whose buyers want a carbon label on the products,” Herbert said. “[businesses realize] they need to set a framework and market their product’s greenness.”
According to several surveys taken over the last few years, more than 40 percent of consumers in the U.S., UK, and EU said they would pay more for environmentally-friendly products. In line with this potential for growth in consumer goods, Herbert said he has seen an increasing demand among companies to become certified and expects that will only increase in the future.
How to Communicate Sustainability to Investors
Despite initial price concerns, shareholders can be convinced to approve sustainable plants. Herbert’s main suggestion to companies staff looking to pitch such an idea is to think like a customer. What will impress the customer will impress the manager. Customers will pay more for green-produced products…and will avoid buying products that aren’t made in a clean way,” Herbert said.
To resolve questions about costs, Reitmeier advises characterizing the project as an investment that will be fully recovered by the time the company’s time there ends.
“Most factories will be leased out for three to five years,” Reitmeier said, “So you have to explain that the payback comes in one to three.”
Rudy Tandjono, Director of Operations for architecture firm iHabitat, suggested a longer-term perspective, saying that even a 10 percent saving over the course of five to ten years of operation in a factory would be worthwhile. Vincent Cheng, Associate Director of consulting firm Arup, adds that features that reduce energy costs like an increased use of natural lighting also improve employee productivity, a notion echoed by Diem. “There’s research out there that shows an energy-efficient building is more comfortable,” Diem said, “so if the people working in such a building are more comfortable, they will also be more efficient.”
A More Sustainable Future
Between savings on utility costs, increased marketing potential, and more efficient employees, the outlook for eco-friendly factories seems bound to increase.
For Rau, an increase in the number of green facilities is not far away. “I think that’s understood on a political level right now,” Rau said, “but it needs to be communicated to independent factory owners that there are lots of opportunities out there for this kind of thing”
— John Herbert, Consultant, Kelcroft