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Updated 21 Jan 2019

Energy efficiency and its influence in the manufacturing sector

Government says industrialisation successes in SA might not be realised without efficient energy management. Are you doing enough to address your factory’s energy reliance?

26 April 2018  Share  0 comments  Print

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With the rising cost of energy affecting companies’ margins around the country (and the world), manufacturing sector executives might find it challenging to use resources more effectively.

Director of Africa Integration and Industrial Development at the Department of Trade and Industry (DTI), Nigel Gwynne-Evans, says that for any near- to medium-term industrialisation objectives to be realised, there has to be innovative thinking around the production and supply of energy – and how it’s used by industrial businesses. 

Globally, energy efficiency in manufacturing remains a key talking point too, with academics weighing in on better ways to run factories.

A business model for better energy management in manufacturing

According to Gökan May and Dimitris Kiritsis, authors of a paper titled Business Model for Energy Efficiency in Manufacturing, traditionally, manufacturing companies focus their business models on delivering high-quality tangible products at low cost. “However, in the last decade, pure low-cost strategies are not as effective as they used to be,” they say.

Related: 3 Trends impacting the future of manufacturing

Concerns over climate change, dissipation of resources, increasing cost of energy, stricter energy regulation policies by government and changing attitudes of society toward manufacturing businesses are factored as key drivers towards a shift in business models amongst manufacturers.

Improving energy efficiency in a factory, particularly one that’s already been running for years, can be challenging for managers and business owners to deal with. And while May and Kiritsis offer valuable insights in their paper that can help you to develop a long-term strategy to reduce energy reliance, what can you do today?

Easy ways for manufacturers to become more energy-efficient

Energy -efficient -factories

Energy is a significant overhead for businesses, from small start-ups to larger corporate organisations. In the manufacturing sector, energy is a key ingredient to keep cogs turning and conveyor belts running. Industry insiders say that once you also factor in the necessary responsibilities and compliances that manufacturers must adhere to on a daily basis, energy costs can start to mount up no matter where you sit in the value chain.

Here’s how you can address energy management in you manufacturing business:

1. Identify the factory’s energy usage peaks and valleys

Your journey to energy-efficacy can start by creating a peak demand analysis. Why do this? It’s because your peak demands for energy change and you can calculate them over a 15-minute interval where your business uses the greatest amount of energy in any given billing period.

It’s said that active energy monitoring, using modern utility monitoring meters and smart analytics dashboards can equate to nearly 30% off a factory’s monthly electricity bill.

Once your energy inefficiencies and waste, down-time energy consumption, and peaks have been identified, you can start to develop efficiency strategies.

2. Appoint a manager or team to holistically look at energy use

According to Gert Kruger, an industrial energy solution consultant with Power-Star South Africa, energy consumption and energy management is becoming more and more important to manufacturers and commercial businesses.

Related: 3 Funding methods to kick off your manufacturing start-up

“Small initiatives like changing to LED lighting and monitoring air-conditioning temperatures should be easy to implement on a departmental or office level. But, real energy management touches the fundamentals of how you do business and this will require the support from decision-makers.”

He says that larger businesses in South Africa have already employed energy or sustainability managers or they are making use of energy management consultants to reduce their energy reliance.

“They understand that electricity is a resource to be managed and that effectively doing so will impact their bottom line. Investment in energy measurement and management could yield a considerable return,” he adds.


If you would like to make your factory more energy efficient, talk to our manufacturing sector experts about tailored financial solutions that can help you fund a new energy monitoring system or even solar solutions, depending on your growth aspirations.

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