Volvo Group North America was able to achieve a 25 percent energy reduction goal five years ahead of schedule through innovative partnerships such as the EDF Climate Corps program and the Department of Energy’s Better Plants program.
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Leading companies take their environmental responsibilities seriously. They use decisive action to minimize the impact of their business operations on the environment, often in turn bolstering their bottom line. For example, excessive electricity use, often an indicator of inefficient operations, wastes money and can have an undesired effect on a business. Seeing an opportunity to turn this around, a growing number of corporations across multiple sectors have started to actively manage their energy use. Manufacturers in particular have a significant opportunity to reduce electricity use while making their businesses stronger. Take for example Volvo Group North America, which in 2010 set a goal to reduce energy intensity use by 25 percent by 2020 – and achieved it five years ahead of schedule by reducing energy consumption in their manufacturing plants.
How? Volvo Group North America’s Rick Robinson, director for health, safety and environment, and Bert Hill, manager for the same department, have discovered a successful way to leverage partnerships to achieve scalable environmental wins through a unique energy management model for their manufacturing plants. The model is simple: set a target and then establish third-party partnerships to help accomplish it–and, it’s been incredibly successful. A range of different partners help Volvo by bringing different skills to the table. Michael Kijak, Energy Manager at the Volvo Group’s New River Valley plant says, “Partnerships have helped Volvo’s New River Valley plant drive significant improvements in energy efficiency. They are a necessary part of our program because they give us the extra ‘energy’ needed to tackle issues and showcase our achievements. They also provide technical expertise, additional tools and a new group of colleagues across many industries.”
To manage these partnerships, Volvo Group North America built a five-step energy management framework, developed through experience – or what they call “learning by doing.” Their model has evolved into a battle-tested playbook that they return to time and time again. This approach has proven to be a scalable model, with the ability to be replicated not only across multiple plants, but across the manufacturing industry.
The “Learning by Doing” Model
The first two steps to Volvo Group North America’s model involve deliberate research, preparation and planning. They started by setting a goal that committed to a measurable reduction in energy consumption within a set time frame. They chose to focus on a 25 percent reduction in energy intensity and set a 10-year timeframe to complete it.
Volvo’s next step was to identify the right partners to work with. Finding partners is key, as they bring best practices, expertise and the manpower necessary for implementation. On its quest to meet its goal, Volvo developed notable longstanding partnerships with the Department of Energy’s (DOE) Better Plants program, and the Environmental Defense Fund’s (EDF) Climate Corps program, as well as other short-term partnerships with vendors and consultants.
Once its partners were in place, Volvo sprang into action, kicking off multiple energy-saving initiatives based on the recommendations of its partners. This led them to step three: supporting their relationships. Volvo knew they needed to ensure that there was sufficient internal bandwidth and funding, as well as a main point of contact to manage each relationship, so they made this a management priority.
Volvo’s fourth step was an important, yet commonly overlooked one: to communicate about each win. Staff took the time to internally and externally share success stories to inform employees and customers about their initiatives. Once a proven track record of success was established, Volvo scaled each partnership. They encouraged new locations to replicate the work through webinars, in-person gatherings or visits to the pilot facility.
Success in Action: the Volvo Group and EDF Climate Corps partnership
In 2011, the Volvo Group’s Mack Trucks facility in Macungie, Pennsylvania began working with EDF Climate Corps – a program that embeds trained graduate students within companies to accelerate energy projects over the summer. These fellows work on-site, side-by-side with staff to build the business case for investment in energy efficiency and clean energy, and identify multiple strategies for improving energy performance. By signing up for EDF Climate Corps, Mack Trucks gained a summer-long resource who could identify efficiency projects, analyze them to determine which were the most promising and then lay the groundwork for implementation.
The Volvo Group’s first fellow, Rohini Sankapal, spent ten weeks examining projects such as variable frequency drives for motors, occupancy sensors for lights, high-volume, low-speed fans, and found opportunities to fix multiple compressed air leaks. In total, Sankapal’s recommendations had the potential to save Volvo more than 2 million kilowatt hours of electricity annually.
Having found success with the program, Mack Trucks continues to participate in EDF Climate Corps, and has shared information about its successful partnership with its counterparts at other Volvo Group manufacturing facilities. Because of this, the Volvo Group Powertrain facility in Hagerstown, Maryland and the Volvo Construction Equipment facility in Shippensburg, Pennsylvania elected to participate in EDF Climate Corps as well. Through six of these summer fellowships so far, Volvo’s facilities have received help with, and recommendations for, projects that could save more than 9.5 million kilowatt hours of electricity annually.
What’s next for the Volvo Group?
Although it has already met its energy savings goal, the Volvo Group has not stopped its intense focus on energy reductions. One of the newest initiatives Volvo is pursuing – energy treasure hunts – follows the same, scalable model. The treasure hunts are focused on low- or no-cost energy projects. Teams of employees spend time in the facility, uncovering opportunities by observing conditions and interviewing staff members. Because Volvo had already accomplished many capital-intensive projects and “low-hanging fruit,” staff see these treasure hunts as a great way to start working on the more behavioral aspects of energy management.
In 2015, Volvo Group North America committed to reduce their energy intensity by another 25 percent over the next ten years. To get there, they plan to continue ongoing work with key partners, such as EDF Climate Corps and DOE’s Better Plants program, and to expand their focus to include exploring renewable energy, engaging energy suppliers and tackling water efficiency.
For other manufacturers looking to achieve energy reductions, utilizing a similar partnerships model is a great first step. For more information on the model and Volvo’s work, click here.
Liz Delaney is the program director for EDF Climate Corps, a program that embeds trained graduate students in organizations to help meet their energy goals by accelerating clean energy projects in their facilities. Through its work with close to 400 organizations, Climate Corps has uncovered nearly $1.5 billion in energy savings — simultaneously improving an organization’s bottom line and environmental impact. You can find her on Twitter at @LizDelaneyLobo.