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Improving Energy Performance in Canada – Report to Parliament Under the Energy Efficiency Act - 2003-2004

Chapter 6: Industry

Energy Use and Greenhouse Gas Emmissions

The industrial sector includes all manufacturing industries, all mining activities, forestry and construction; however, it excludes electricity generation. This sector uses energy in industrial processes as a source of motive power to produce heat or to generate steam. Overall, industrial energy demand accounts for 38.7 percent (3176 petajoules) of secondary energy use and 33.8 percent (163 megatonnes) of greenhouse gas (GHG) emissions (including electricity-related emissions).

Within the industrial sector, energy is consumed primarily in pulp and paper, mining, petroleum refining, and smelting and refining industries. Pulp and paper alone accounted for almost 27 percent of total industrial energy demand in 2002 (see Figure 6-1).

In most industries, energy purchases account for only a small proportion of total expenditures. However, for some relatively energy-intensive industries – cement, chemicals, and pulp and paper – this share is higher than 14 percent (see Figure 6-2). For cement, in particular, the share is as high as 39 percent.

Actual industrial energy use increased by 16.9 percent (459 petajoules) between 1990 and 2002. This increase was driven by a 43.5 percent increase in industrial activity, measured as a combination of physical units of production, gross output and gross domestic product (GDP). However, some of this increase in energy use that would have resulted from the increase in activity was offset by improvements in energy efficiency and structural change – the shift to less energy-intensive industries (such as electrical and electronics).

Three main factors influenced energy use:

• activity – increases in physical units of production, gross output and GDP contributed to a 43.5 percent increase in industrial activity resulting in a 1183-petajoule increase in energy use
• structure – the change in the mix of activity toward less energy-intensive industries resulted in a 338-petajoule decrease in energy use
• energy efficiency – due to a 14.2 percent improve-ment in energy efficiency (between 1990 and 2002), the industrial sector avoided 386 petajoules of energy use in 2002 alone

The change in energy use between 1990 and 2002 and the estimated energy savings due to energy efficiency are shown in Figure 6-3.

Between 1990 and 2002, industrial GHG emissions including electricity-related emissions increased by 15.2 percent. Excluding electricity-related emissions, industrial GHG emissions increased by only 8.2 percent over the same period. Most of this increase occurred in the upstream mining industry, while mining (excluding upstream), manufacturing and construction industries realized a 3.4 percent decrease in GHG emissions.

Natural Resources Canada (NRCan) delivers initiatives to increase energy efficiency in the following components of the industrial sector:

• industrial processes and technologies
• equipment
• buildings (refer to Chapter 5)

Industrial Processes and Technologies: Industrial Energy Efficiency

(Canadian Industry Program for Energy Conservation [CIPEC] and Industrial Energy Innovators [IEI])

Objective: To help Canadian industry use energy efficiency investments to improve competitiveness and to contribute to Canada's climate change goals.

CIPECis a unique industry-government partnership committed to promoting and encouraging energy efficiency improvements and reductions in GHG emissions through voluntary action across Canada's industrial sectors. CIPEC comprises 25 sector task forces that involve more than 45 trade associations.

CIPEC, a sector-level program, and IEI, a company-level program, both address barriers to planning, implementing, tracking and reporting energy efficiency projects in industry. Key elements include the establishment and tracking of energy efficiency improvement targets and plans, and the development of products and services that overcome barriers to continued energy efficiency improvements. NRCan provides support via employee awareness kits and events, best-practices guides, technical information, energy audits, benchmarking and workshops on energy management.

CIPEC targets all of industry, including mining, manufacturing and construction as well as upstream oil and gas and electricity generation. Between 1990 and 2002, CIPEC mining, manufacturing and construction industries achieved an average energy-intensity improvement of 1.9 percent per year, thereby avoiding 23.8 megatonnes in GHG emissions. During this same time period, all CIPEC industries (including oil and gas and electricity generation) achieved an average energy-intensity improvement of 0.7 percent per year, thereby avoiding 25.2 megatonnes of GHG emissions. Effective energy management by CIPEC companies resulted in $3.4 billion in savings in 2002. As Figure 6-4 demonstrates, significant energy intensity improvements occurred in the latter part of the last decade. Between 1996 and 2002, energy intensity decreased by 11.0 percent.

According to a recent study, there is a statistically significant difference between energy consumed by CIPEC participants and non-participants:

• Growth of energy consumption for CIPEC participants was approximately half of that of non-participants (2.2 percent growth versus 5.4 percent growth).
• Three times more participants reported reduced energy use than non-participants.
• Fifteen percent fewer participants reported an increase in energy use than non-participants.

Key 2003-2004 Achievements

• Recruited 147 new Industrial Energy Innovators (see Figure 6-5).
• Initiated 152 Industrial Energy Audits.
• A study completed in May 2003 found that industrial companies that have participated in Dollars to $ense workshops have together saved more than 3 petajoules of energy and 184 kilotonnes of carbon dioixde (CO₂) equivalent per year.

For more information:
oee.nrcan.gc.ca/cipec/ieep

Industrial Processes and Technologies: Cleaner Fossil Fuel Power Generation

Objective: To design, develop and deploy technologies for power generation from fossil fuels with increased efficiency, and reduction and ultimately elimination of emissions of acid rain precursors, GHGs, particulates and identified priority substances – mercury, trace elements and organic compounds.

Research focuses on improving performance and reducing emissions for existing fossil fuel power plants and on developing new advanced cycles for conversion of fossil fuels to electricity with complete or near complete capture and elimination of CO₂ and other emissions. Additional research undertaken includes issues associated with the transport and storage of CO₂.

Key 2003-2004 Achievements

• Developed Canadian technology roadmaps that identify technologies that will be needed for the clean and efficient use of coal with CO₂ capture and storage – to be published in 2005.
• The Canadian Clean Power Coalition completed its evaluation of clean coal technology options for new power plant construction and is proceeding with plans to build a new clean coal technology power plant meeting near zero emissions into the atmosphere by 2010.
• Commissioned a new pressurized gasifier pilot plant capable of operating at 1400°C. The unit, the only one of its type in North America, will act as an economical testbed for Canadian utilities interested in advanced technology development, hydrogen production and CO₂ capture. Gasification provides high electricity generation efficiency; allows CO₂ capture at low cost and low energy penalty; permits economical, highly efficient removal of sulphur oxide, nitrogen oxide and mercury; and will provide energy security through clean use of Canada's indigenous coal reserves.
• Designed, manufactured, tested and patented a 100-megawatt equivalent oxy-fired gas turbine. The technology enables CO₂ and mercury capture through O₂/CO₂ combustion.
• Implemented with Canadian International Development Agency (CIDA), Canada Climate Change Development Fund, the Chinese government and private sector partners, a $3.1-million research and technology transfer project for power generation in China that will result in GHG reductions of up to 3.5 million tonnes over 10 years.
• Devised a new combustion protocol for assessing energy and emission performance of bitumen/water emulsions for industrial applications. This emulsified fuel can replace natural gas in the steam-assisted gravity drainage recovery of oil sand bitumen.
• Developed and tested, in cooperation with Ontario Power Generation, a low-cost sorbent injection, mercury capture technology for coal-fired electric utility boilers.
• Successfully demonstrated a new measurement and characterization methodology for PM_2.5 fine particulate matter emissions. Application of Canada-wide standards to large industrial sources in 2010 will require reliable measurement methods.

For more information:
nrcan.gc.ca/es/etb/cetc/cetc01/htmldocs/programs_e.html

Industrial Processes and Technologies: Processing and Environmental Catalysis Program

Objective: To solve industrial process problems and undertake research in areas with high potential for significant environmental and economic benefits.

The program's facilities, including semi-pilot scale plants, are used for process testing and the evaluation of novel concepts in chemical and energy conversion, including hydrogen production from hydrocarbon and renewable sources. Clients include oil and gas companies, petrochemical companies, original engine manufacturers, waste oil renderers and specialty ceramic manufacturers.

Key 2003-2004 Achievements

• Developed a process for stabilizing/conditioning a diesel fuel derived from waste motor oil. CANMET Energy and Technology Centre (CETC) received its first royalty payment from licensing the process to a Malaysian company. A commercial plant was commissioned in December 2004.
• Developed ceramic membranes for hydrogen separation at high temperatures. This is an enabling technology to improve energy efficiency and economics of hydrogen production and hydrogen recovery in the petroleum/petrochemical industries. Reproducibility of membranes is now approaching 100 percent.
• Developed zero emissions ammonia fuel cells in collaboration with CANMET Materials Technology Laboratory. Proof of concept has been demonstrated, resulting in two peer-reviewed journal publications. Preliminary assessment indicates a significant market opportunity exists for 10-20 kilowatt fuel cells in distributed power generation. Two ammonia producers have expressed interest in this technology.
• Developed a technology for the production of low-sulphur, high-cetane blending stock from waste restaurant grease and vegetable oils. Life-cycle analysis shows a 23 percent reduction in GHG emissions using a 20 percent blend of tallow-derived SuperCetane and diesel fuel. A 20-litre production run was done for the Government of Ontario using soy oil as a feedstock.
• Developed a highly energy-efficient process for converting naphtha to olefins. Catalyst testing was done for Valeo Management Services, a technology development company spun off from Concordia University.
• Developed pyroelectric generation technology. This technology produces electricity from low-grade waste heat for increased industrial plant efficiency, and it avoids GHG emissions due to combustion of fossil fuels to provide part of or all of the power requirements of an industrial plant. The power density of lab-scale prototype units has reached 300 watts per litre of active material.

For more information:
nrcan.gc.ca/es/etb/cetc/cetc01/htmldocs/programs_pec_e.html

Industrial Processes and Technologies: Industrial System Optimization Program

Objective: To support the development and adoption of innovative energy-efficient practices in Canadian industry to continuously improve its energy efficiency and productivity, while decreasing GHG emissions and other environmental impacts.

The program focuses on systematic industrial process analysis methods and techniques, such as Process Integration (PI) and advanced process control systems, to identify and correct inefficiencies in plant operation taking into account energy, economy and environmental aspects. It seeks to meet its objective by performing leveraged research and development through national and international collaboration. Furthermore, the program disseminates technical information that will encourage the adoption of these practices in targeted energy-intensive sectors of Canadian industry including pulp and paper, oil upgrading and refining, petro-chemicals, steel, chemicals, solid wood, and food and drink.

Key 2003-2004 Achievements

• Completed a successful collaboration in PI with Cascades Inc., a North American leader in the production, conversion and marketing of packaging products; this collaboration entailed training engineers and the completion of two PI studies. This initiative allowed Cascades to identify cost-effective energy savings of $4.5 million per year, with an average payback period of eight months, and GHG emission reductions of 34 kilotonnes per year.
• Disseminated information on the value of PI by participating in a series of six technical workshops with representatives of energy-intensive Canadian industries, and through a unique and high quality Web site.
• Conducted a survey on energy performance of sawmills in the province of Quebec that showed that there is room for significant energy savings. Furthermore, decision-making tools were developed for better process operation and energy management in sawmills using a data mining approach.

For more information:
cetc-varennes.nrcan.gc.ca/en/indus.html

Industrial Processes and Technologies: Industry Energy Research and Development (IERD) Program

Objective: To encourage and support the development and application of leading-edge, energy-efficient and environmentally responsible processes, products, systems and equipment in industry.

Financial support is provided for commercially confidential applied research and development (R&D) activities, which is repayable if the project is commercially successful. Program clients from all industrial sectors range from small- and medium-sized companies to multinational corporations.

Key 2003-2004 Achievements

• Further to the successful completion of an IERD-supported R&D project, Turbocor Inc. of Montréal, Quebec, is commercializing a novel compressor for refrigeration applications that requires no lubricating oils and has no chlorofluorocarbons. This represents a breakthrough in industrial and commercial refrigeration and is generating energy savings of 30 percent. Turbocor won a Canada's Energy Efficiency Award in early 2003, the 2003 Air-Conditioning, Heating and Refrigeration Expo's "Energy Innovation" Award and most recently the 2004 U.S. Environmental Protection Act Climate Protection Award, which is given to organizations for the extraordinary accomplishments that have made significant contributions to protecting the environment.
• Société des technologies de l'aluminium du Saguenay in Chicoutimi, Quebec, is working at developing, in partnership with Lauralco Inc. in Deschambault, Quebec, an automated anode replacement and positioning system. This system will increase energy efficiency of the aluminum smelting process and reduce GHG emissions. This system is forecast to be in service by end of 2004.
• Systèmes d'Optimisation Énergétiques Inc., Saint-Mathieu-de-Beloeil, Quebec, is a young company that is developing a new mechanical transmission for diesel generator sets. The projected energy savings is in the 15 to 25 percent range. This new device will also permit extension of the diesel engine life by 25 percent.

For more information:
nrcan.gc.ca/es/etb/cetc/cetc01/htmldocs/factsheet_industry_energy_research
_and_development_program_e.html

Industrial Processes and Technologies: Emerging Technologies Program (ETP)

Objective: To support the identification and demonstration of new and emerging energy-efficient technologies.

Projects are co-managed and cost-shared with industry and other stakeholders, such as gas and electric utilities, other governments and equipment manufacturers. Financial support is provided for the development and testing of pilot plants, prototypes and full-scale field trials to evaluate operating performance, energy efficiency and environmental impacts. NRCan's financial support is repayable from any cost savings or revenues realized from a project.

Key 2003-2004 Achievements

• NRCan is supporting Sirex Engineering of Mississauga, Ontario, in its development of a production-scale process that recycles post-industrial polyethylene cross-linked foam waste material into foam sheet products. Pressure on landfill sites will be alleviated and substantial energy reduction will be achieved by supplanting or replacing a new stream of polyethylene foam and the depletion of petrochemical feedstocks.
• Westport Research Inc. of Vancouver, British Columbia, with NRCan support, has delivered and installed a natural gas engine for stationary power generation to a water/wastewater treatment facility in Grande Prairie, Alberta, and by September 2004 will complete a one-year field trial of a low-emissions (17.8 percent less CO₂) natural gas engine for stationary power generation using the Westport high-pressure direct injection technology.

For more information:
nrcan.gc.ca/es/etb/cetc/cetc01/htmldocs/funding_programs_etp_e.html

Industrial Processes and Technologies: Industrial Energy Innovation

Objective: To assist major industrial energy consumers to reduce the energy intensity of their operations and to reduce GHG emissions, by-product emissions of CO₂ and other GHGs.

Industrial combustion processes are the major sources of industrial GHG emissions. Because they operate at low thermal efficiencies of 30 to 50 percent, there are major opportunities to improve industrial energy efficiency and productivity while significantly reducing GHG emissions.

CETC's work in this area includes changing the interaction of the combustion system with the process, with advanced tools and technologies. As well, together with the Large Final Emitters Group and the Office of Energy Efficiency, CETC held technical workshops with major industry sectors (steel, mining, smelting and refining, cement, lime, and pulp and paper) and with CIPEC, industrial associations and individual companies to help define and map partnerships for a generic industrial combustion R&D program and applications to take advantage of these opportunities, with potential energy and GHG reductions of 10 to 40 percent. In addition, it is engaged in developing generic tools and technologies that cross industry sectors, fuels and furnaces.

Key 2003-2004 Achievements

Numerous projects contributed the following:

• greater energy efficiency in the making of iron and steel
• higher energy efficiency and reduced GHG emissions in coking processes used in the iron and steel industry
• development of high-efficiency, low-nitrogen-oxide burners for industry
• application of low-cost computational fluid dynamic (CFD) modelling as a pre-cursor to large engineering projects to inject natural gas into blast furnaces and upgrade a refinery heater
• improved performance and reduced emissions in flaring emissions in refining and chemical industries through flare tip redesign and a software tool to assess oil field emissions
• test facility for combustion performance of bio-oil in micro-turbine and other combustors
• developed scanner technology that monitors burner performance and optimizes operation for industrial applications

For more information:
nrcan.gc.ca/es/etb/cetc/cetc01/htmldocs/programs_e.html

Industrial Processes and Technologies: Minerals and Metals Program

Objective: To reduce GHG emissions from Canada's Minerals and Metals Sector by enhancing mineral and metal recycling processes and practices, and by assessing alternate production processes. The initiative has a GHG reduction target of at least 1.65 million tonnes of CO₂ equivalent per year, by 2010.

The Minerals and Metals Program is a component of the Government of Canada Action Plan 2000 on Climate Change. The Minerals and Metals Program was restructured in 2003-2004 to allocate $10 million to two distinct areas: Enhanced Emission Reduction for Minerals and Metals, and Enhanced Recycling. The Program is managed by a Steering Committee consisting of representatives from Environment Canada, Industry Canada and Natural Resources Canada (Chair) and two program-area-specific Advisory Committees, consisting of experts in the field and representatives from industry, government and non-governmental organizations. Daily operations are overseen by the CANMET Mineral Technology Branch. The Enhanced Emission Reduction for Minerals and Metals program area supports activities that will increase the use of fly ash, blast-furnace slag, silica fume and other Supplementary Cementing Materials (SCMs) in concrete to displace Portland cement, thereby reducing the GHG intensity of concrete production. The Enhanced Recycling program area aims to increase Canada's potential to recycle all materials by developing new approaches and improving upon existing recycling infrastructure, practices and policies.

Key 2003-2004 Achievements

• EcoSmart^TM Foundation Inc. received funding for several technical studies and a national expansion to broaden the impact of its work.
• CANMET's Materials Technology Laboratory began development of a user-friendly tool for contractors wanting to use SCMs in their construction projects. The program also supports a broad range of initiatives such as examining cogeneration and CO₂ sequestration.
• The Enhanced Recycling program raised awareness of many important issues among a broad group of stakeholders across Canada, especially at the municipal and regional level, through participation in various communications opportunities. Other activities included completion of a scan of metals and minerals recycling programs to determine effectiveness and ongoing improvements in statistics/data collection for secondary resources in order to identify gaps in current recovery strategies.

For more information:
nrcan.gc.ca/mms/canmet-mtb/mtl/research/concrete_e.htm

Equipment: Energy Efficiency Standards and Regulations

Objective: To eliminate the less energy-efficient models of energy-using equipment from the market through minimum performance regulations under the Energy Efficiency Act.

The Energy Efficiency Regulations incorporate national consensus performance standards that include testing procedures to determine the energy performance of the equipment. They prohibit the import of, or interprovincial trade in, prescribed products that fail to meet minimum energy performance levels and labelling requirements.

Key 2003-2004 Achievements

• Pre-published eighth amendment to the Energy Efficiency Regulations to increase the minimum energy-performance standards for clothes washers and gas-fired and electric storage water heaters, and to establish minimum energy-performance standards for water chillers and exit signs.
• The cumulative annual reductions in CO₂ emissions resulting from the aggregate energy savings attributable to the eighth amendment to the Energy Efficiency Regulations are estimated to be approximately 0.19 megatonnes in the year 2005 and 3.61 megatonnes in the year 2020.

For more information:
oee.nrcan.gc.ca/regulations/home_page.cfm

Equipment: Labelling and Promotion

Objective: To promote the production, purchase and use of more energy-efficient equipment.

The initiative consists of EnerGuide for Equipment, which provides comparative information on the energy performance of equipment – including heating, ventilating and air conditioning (HVAC) – and the ENERGY STAR^® label, which allows industrial purchasers to identify the most energy-efficient products available based on a standard set of criteria.

Key 2003-2004 Achievements

• Market studies completed for compressors, uninterruptible power supplies, battery chargers, arc welding and pumps.

For more information:
energuide.nrcan.gc.ca/
or
oee.nrcan.gc.ca/equipment/
or
energystar.gc.ca

Equipment: Mine Ventilation

Objective: To reduce energy consumption and GHG emissions associated with mine ventilation through infrastructure automation (to support demand-based delivery systems), ventilation network optimization and management, and less air-volume demanding technology.

Mine ventilation systems that were traditionally designed to operate at maximum flow (peak production 24 hours a day and 7 days a week) are being adjusted to match actual production needs. Ventilation is required in underground mines to maintain a safe working environment by diluting and removing harmful pollutants (dusts and gases) and providing a thermally suitable working climate. Providing sufficient and suitable ventilation can account for 40 percent of the energy consumed underground by a mining operation. Efficient energy savings at less than peak demands range from linear for the heating/cooling systems to a cubic relationship for the primary fan system. However, optimizing energy use is not straightforward, as it depends on the specific consumption profile for each mine and therefore needs evaluation on a case-by-case basis.

Key 2003-2004 Achievements

• A "ventilation on demand" feasibility study continued for a deep-ore zone with INCO Limited's Creighton Mine. The focus was to reduce the energy demands of the existing ventilation system, delay any need for mechanical refrigeration and identify, track or control the production requirements to achieve these savings.
• A ventilation benefit analysis was completed on the potential impact of converting from diesel to fuel-cell powered production equipment. This study showed that ventilation could be reduced but other contaminants became the limiting design criteria, and the reductions in energy, GHG emissions and cost were very dependent on factors such as the mine's energy consumption profile.
• There was a collaborative development (funded by the Office of Energy Efficiency) of a mine life-cycle ventilation demand simulator. This initial simulator, which is part of an NRCan engineer's ongoing doctoral thesis, will determine where the optimal energy environment and cost benefits in mine ventilation networks exist.

For more information:
nrcan.gc.ca/mms/canmet-mtb/mmsl-lmsm/mines/air/air-e.htm