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Clean Power Plan Means Significant Savings for Manufacturers



The ability of U.S. firms to manufacture goods and sell them to world markets has propelled the nation into its current position as a world's greatest economy. Despite this historic strength, global competition for export markets, foreign investments and raw materials is intensifying, and U.S. manufacturing is struggling to remain competitive.

However, new studies by Dr. Marilyn Brown and the Georgia Institute of Technology and the Alliance for Industrial Efficiency have found that implementation of the Obama Administration's Clean Power Plan (CPP), state climate and energy policies and investments they are spurring in energy efficiency and cleaner sources of energy provide a way for manufacturers to be more competitive, not less.

During a telephone news conference, Dr. Marilyn Brown, the Georgia Tech study's author, said that if states were to adopt a low-cost Clean Power Pathway to compliance, U.S. industries could have an estimated annual energy savings of $39.6 billion (8.3%) in 2030. Over 15 years, cumulative savings of $442 billion could be used for plant modernization, product improvements or many other possibilities with favorable impacts on local jobs.

"Manufacturers can become more competitive by improving the energy efficiency of their operations in order to cut their energy bills," said Dr. Brown. "An added benefit is that their carbon pollution would be cut simultaneously. Transitioning to a low-carbon economy will also create opportunities for business growth. Many business owners and industry leaders are motivated not just by the `push' of environmental regulation, but also by the `pull' of potential cost savings, new customers, higher staff retention and good publicity."

Conversely, Dr. Brown said that if business is done as usual, energy bills of U.S. industries could rise by 44.2% over the next 15 years.

The Alliance study - State Ranking of Potential Carbon Dioxide Emission Reductions through Industrial Energy Efficiency - also demonstrates that states could help the industrial sector seize opportunities to cut carbon emissions, while saving money and making manufacturers more competitive, by making energy efficiency and clean energy investments associated with climate change policy compliance.

"In the debate about how states are going to tackle emissions, the report shows businesses can slash emissions and save money on electricity bills at the same time," said Jennifer Kefer, Executive Director of the Alliance. "By investing in industrial energy efficiency, including combined heat and power, states can also achieve nearly one-third of their CPP targets."

Kefer cited Nissin Brake, an Ohio-based auto parts company, as an example of what other U.S. manufacturers might expect from industrial efficiency investments.

"Nissin Brake partnered with its utility - AEP Ohio - since 2008 to install a variety of energy efficiency improvements to its facility, including compressed air, chiller and manufacturing equipment upgrades," Kefer said. "Nissin Brake estimated savings of $3.4 million in avoided energy costs since 2008, while investing only $1.7 million, through its participation in AEP Ohio's program."

Elinor Haider, VP for Communications & Public Affairs at Veolia North America, an operator and developer of global energy efficiency solutions, said these kinds of savings are not atypical.

"Simultaneous production of power and thermal energy - also known as combined heat and power (CHP) or cogeneration - consumes less fuel than if produced separately and can exceed 80% efficiency," said Haider. "We also put our money where our mouth is when it comes to industrial efficiency. Not only does Veolia advise clients to use such efficient and sustainable approaches to save money, but we also apply CHP best practices to operations, ensuring the most efficient use of our own resources."

The new Georgia Tech study examined the finalized CPP developed by the U.S. Environmental Protection Agency and the Obama Administration.

For more information contact:

Georgia Institute of Technology

North Avenue

Atlanta, GA 30332

404-894-2000

www.gatech.edu

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