September 4, 2008

Time For U.S. Manufacturing To Consider Energy Efficiency

While many manufacturers have been reluctant to invest in energy efficiency and have deferred domestic investments due to market uncertainty, a new report by American Council for an Energy-Efficient Economy, titled “Trends in Industrial Investment Decision Making,” says economic indicators suggests that the industrial sector is poised for a new period of major capacity investments, because existing capacity is approaching full utilization.

In addition, the report reveals that a number of market trends are beginning to favor a shift to domestic production for domestic consumption. The report says this new period of major capacity investment represents a chance for program managers to influence energy efficiency at facilities.

Compared with commercial or residential sectors, energy efficiency investment in the industrial sectors typically requires longer project cycles and have limited opportunities for retrofitting. But the report says the efficiency savings in the industrial sector can be large and cost-effective when implemented as part of a normal capital investment cycle.

In a May, ACEEE released a report showing that by investing in cost-effective but underutilized energy-efficient technologies in the future, the U.S. can reduce energy consumption by an additional 25 to 30 percent or more over the course of the next 20 to 25 years.

The U.S. manufacturing sector spent $5.9 billion dollars on capital expenditures and $20.7 billion dollars on operating costs for pollution prevention and treatment in 2005.

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