Kimberly-Clark Triangulates To Make the Business Case: Q&A with Juan Marin

Kimberly-Clark is currently aiming for a 20% reduction in absolute greenhouse gas emissions by 2022. The target, which is part of the American multinational personal care corporation’s sustainability goals, was initially set in 2015 against a 2005 baseline.

The baseline year was chosen because that’s when the company first began tracking greenhouse gases, explains Juan Marin, energy solutions manager for Kimberly-Clark. “It’s 20% because that was the output of running models to be sure the target is aggressive enough. We ran the Sectorial Decarbonization Approach, The 3% Solution of the WWF, and we submitted the numbers to ScienceBasedTargets.org for them to verify.”

Marin, a longtime member of the Energy and Climate Solutions team, says that the company’s strategy for reaching their target has three pillars: the execution of energy projects, the execution of alternative and renewable energy projects, and lean energy management.

Recently we caught up with him to find out more about this strategy and how his team makes the business case for energy-related projects.

How is Kimberly-Clark doing in relation to the 2022 goal?

We are making great progress. The consolidated greenhouse gas progress during 2018 is 18.6%, and that is without considering some of the renewable energy that we started buying in 2018. If we include the greenhouse gas reductions out of the power purchase agreements of renewable energy in North America, that number is around a 26% reduction since 2005. But we want to play by the rules as defined in the goal.

What contributed to that location-based reduction in the past year?

The big win was the execution of around 220 energy conservation projects across the company. That’s 25% more projects than in 2017. We have 70 manufacturing sites around the world with different processes — tissues, family care, baby and childcare, adult fem care.

It’s the implementation of best energy practices around lighting, compressed air, variable frequency drives, and heat recovery. In 2018, those projects saved us around 80,000 metric tons of greenhouse gas. That helped us to improve energy efficiency. Since 2005, our progress is a more than a 30% improvement in energy efficiency.

How do you determine which projects to pursue?

Our team has the capability to do energy assessments. We travel all around the world doing those, identifying opportunities across Kimberly-Clark. Then we start what we call a triangulation process, which is our team working with that particular manufacturing site leadership and the sector or business unit’s leadership.

The three sides of the triangle are giving visibility into the opportunities, getting alignment about the resources in terms of funds and people to execute those projects, and focusing on the great impacts that we can achieve on savings and greenhouse gases.

Are there challenges that come up during this process?

Our team, the Energy and Climate Solutions team, does not own the capital. Funds for projects are owned by every region and business unit. So all energy conservation and efficiency propositions and projects are competing against other priorities.

That is why we need to come in with solid technologies and financial analysis to demonstrate that we have a winning proposition that can be included in the capital investment plan. We team up with the sector leaders and plant managers to give visibility into the opportunities that we can realize through energy conservation projects.

So you always have to make the business case?

That’s exactly right. It’s also speaking the language of the business. Usually we in energy, climate, and sustainability talk about “greenhouse gases” and “a percentage of renewable energy” and “energy efficiency” and “energy intensity.”

But the language we must speak at Kimberly-Clark with the business side is the financial impact those projects will have and the savings the projects will deliver. For instance, our 20% greenhouse gas reduction target for 2022, that’s what we communicated externally in our sustainability report. But also we have an internal target about the savings that we can deliver with the achievement of that goal.

What advice do you have for other energy managers?

Instead of trying to develop that business case as an island, collaborate with the business unit to develop the financial analysis. For instance, instead of us running the financial numbers for the project, we use the financial analysts in every region where we operate to identify the financial KPIs. This helps us speak the same language and stay aligned with their expectations.

Speaking of collaboration, what is Kimberly-Clark’s lean energy management program?

Lean energy means working with lean principles and continuous improvement tools to deploy three main elements: operational systems, management infrastructure, and mindset, behaviors, and capabilities. Operational systems are process improvement opportunities that will give us energy savings and energy efficiency. Management infrastructure involves the installation of energy meters and dashboards that show real-time energy consumption to operators and creating KPIs at the same level of other priorities such as safety, quality, and delivery.

The third element is mindset, behaviors, and capabilities — working with the people in the middle, providing training opportunities, creating an awareness campaign, creating a recognition program. So far we have the lean energy strategy fully deployed in 35 manufacturing sites. It is saving us around 80,000 metric tons of greenhouse gases, and a substantial amount of money as well.

You mentioned renewable energy — how is that going?

At the end of 2017, we communicated that a third of our electricity purchased in North America will be from renewable energy sources. So 2018 was the realization of that. We got the benefits of the two wind farms in Texas and Oklahoma. Also in 2018, we started the execution of four co-generation plants: two in North America and two in Latin America Operations.

This year we are exploring opportunities in the UK, Singapore, and China, and we are looking at projects in LAO, Europe, and the Asia Pacific.

What’s next for energy management at Kimberly-Clark?

We are focusing on delivering the goals for 2022, but beyond that is the identification of new technologies we can deploy at our manufacturing sites. For example, we have the best practice of installing blowers on the vacuum in our tissue process. This gives us a 50% reduction in electricity consumption in the vacuum section of a tissue machine, which is 40% of the electricity consumption in the whole tissue machine. Finding similar technologies will help us keep up the pace in energy conservation.

We want to have lean energy deployed in 100% of our manufacturing sites. The next step is going to an artificial intelligence between our meters and the variables that we can control. Now we have visibility into energy consumption and operators can react. What we’re shooting for is that will be fully automatic so the system can take control of those variables to guarantee that we are reducing energy.

In renewables and alternative energy, we’re trying to find opportunities in terms of solar, wind, and co-generation plants for big tissue facilities. And take advantage of a hopefully lower cost for renewables in the future to help us put together and justify the business case.

We are currently accepting submissions for the 2019 Energy Manager Awards. Learn more and submit a project or product here.