PDP Needs Assessment Iron and Steel Sector Thailand

NEEDS ASSESSMENT
Energy Efficient Technologies for the Iron and Steel
Sector in Thailand
www.efficiency-from-germany.info
Imprint
Authors
Karun Pantong
Monthon Kumpaengseth
Supalerk Kanasook
Thomas Chrometzka
Milou Beerepoot
July 2014
Publisher
Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH
On behalf of the
German Federal Ministry for Economic Affairs and Energy (BMWi)
Cover Image
"Stahl-Zentrum", HKM, Duisburg-Huckingen
Contact
Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH
Köthener Str. 2, 10963 Berlin, Germany
Fax: +49 (0)30 408 190 22 253
Email: [email protected]
Web: www.giz.de/projektentwicklungsprogramm
Web: www.efficiency-from-germany.info
This publication is part of the Project Development Programme (PDP) South-East Asia. PDP South-East Asia is implemented by the
Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH on behalf of the German Federal Ministry for Economic Affairs
and Energy (BMWi) under the “energy efficiency – Made in Germany” initiative. More information about PDP and about energy efficiency
markets in South-East Asia can be found on the website www.giz.de/projektentwicklungsprogramm.
This publication, including all its information, is protected by copyright. GIZ cannot be liable for any material or immaterial damages
caused directly or indirectly by the use or disuse of parts. Any use that is not expressly permitted under copyright legislation requires the
prior consent of GIZ.
All contents were created with the utmost care and in good faith. GIZ assumes no responsibility for the accuracy, timeliness, completeness
or quality of the information provided.
Content
1.
2.
3.
4.
Introduction
Sector analysis iron and steel sector Thailand
Consulting actions iron and steel sector Thailand
Needs assessment iron and steel sector Thailand
4.1
Energy Efficiency Technology assessment survey
4.2
Energy Efficiency Technology assessment ISIT
4.3
Results
5. Conclusions
6. References
Annex 1
1. Overview of EE policies for the industry sector in the EU and Germany
1. EU Regulations:
2. German Regulations:
Annex 2
Priority Analysis of Energy Efficiency Technology required by the Steel Industry in Thailand
1
2
5
6
6
6
7
8
9
10
10
10
10
12
12
i
List of Figures
Figure 1: Importance of energy efficiency according to iron and steel sector respondents
Figure 2: Top 6 barriers to energy efficiency scored by iron and steel respondents
Figure 3: Drivers for energy efficiency in the Thai iron and steel sector
Measurement
W
kW
MW
GW
MJ
Watt
Kilowatt
Megawatt
Gigawatt
Mega joule
Wp
kWp
MWp
GWp
Watt peak
Kilowatt peak
Megawatt peak
Gigawatt peak
Wh
kWh
MWh
GWh
Watt hour
Kilowatt hour
Megawatt hour
Gigawatt hour
List of Acronyms
ii
BMWi
German Federal Ministry for Economic Affairs and Energy
EAF
High Efficiency Electric Arc Furnace (EAF)
EE
Energy Efficiency
EEDP
Energy Efficiency Development Plan
EEAP
Energy Efficiency Action Plan
EPPO
Energy Policy and Planning Office (EPPO), Ministry of Energy, Bangkok
ESCO
Energy Service Company
GIZ
Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH
ISIT
Iron and Steel Institute of Thailand
PDP
Project Development Programme
PM
Power Management (PM)
VSD
Variable-speed drive
VDMA
German Engineering Federation
2
3
4
NEEDS ASSESSMENT: ENERGY EFFICIENT TECHNOLOGIES FOR THE IRON AND STEEL SECTOR IN THAILAND
1. Introduction
In order to tackle the major future energy challenges of Thailand - energy supply security, increasing energy costs,
dependency on energy imports as well as increasing pollution and carbon dioxide (CO2) emissions - the Thai
government formulated a 20-year Energy Efficiency Development Plan (EEDP) and introduced the 20-year Energy
Efficiency Action Plan (EEAP) in early 2013. The overall aim of the EEAP is to reduce energy intensity in 2030 by
25% compared to 2010, which is equivalent to a reduction of final energy consumption by 23.5% or about 38,200
tons of crude oil equivalent (ktoe) in 2030. A very important sector for realising energy efficiency in Thailand is the
industry sector; especially the energy intensive industry sector can benefit from energy savings.
The steel industry has a rather small share in the industry sector in Thailand, accountable for approximately 4% of
total industrial energy consumption in the country (EPPO 2011). It is, however, an energy-intensive industry with an
energy intensity of up to 3,156 MJ/ton of semi-finished products in 2010 (ISIT 2012). Furthermore, through a
comparison with international best practices, and considering the current technology and production process in
Thailand, the Iron and Steel Institute of Thailand (ISIT) estimates a potential of 10 - 33% for energy conservation in
this sector (Ibid., p. 21).
In the framework of the German Federal Ministry of Economic Affairs and Energy (BMWi) Project Development
Programme (PDP) Energy Efficiency in South-East Asia, a sector analysis and needs assessment has been conducted,
in order to identify most effective energy efficient technologies in the iron and steel sector, and to see where potential
business partnerships between German and local companies in the iron and steel sector in Thailand can be promoted.
This report describes a sector analysis of the iron and steel sector in Thailand, the consulting actions that have been
exchanged with the iron and steel sector as well as a needs assessment for know-how and capacity building on energy
efficient technology.
1
2. Sector analysis iron and steel sector Thailand
A sector analysis was conducted in order to learn more about factors that influence energy efficiency engagement in
the Thai iron and steel sector. An Energy Efficiency (EE) survey has been developed and conducted to look at current
barriers, drivers and EE technologies. It combines two methods: interviews conducted with iron and steel industry
expert as well as questionnaires sent to in-house experts of companies in the iron and steel industry sector.
For the EE survey, persons who function as a link between the management level and employees were identified as
target group. In Thailand, each large factory has a person who is responsible for all energy issues, especially energy
auditing and reporting. Therefore, these persons seemed to be a suitable contact person. In the end, 23 steel
companies remained and received the questionnaire1.
In addition, a semi-structured interview was conducted with a representative of the Iron and Steel Institute in
Thailand (ISIT).
Results of the EE survey amongst iron and steel industry representatives can help in getting a general impression of
the factors influencing energy efficiency engagement in the Thai iron and steel sector. First of all, a very general
question asking for the importance of energy efficiency showed that on a 1 to 5 point scale, the score of the
respondents leaves no doubt, all respondents answered by marking the “5” level (Figure 1).
Figure 1: Importance of energy efficiency according to iron and steel sector respondents
The next question asked for scoring barriers to energy efficiency in the iron and steel sector. The most important
barrier for the participants of the steel sector is “Uncertainty about future energy prices” (Figure 2). Since this
sector is an energy intensive industry, the concern outweighs all others. A clear signal for increasing future energy
prices would therefore yield more investment in energy efficiency. Without a clear signal of a rise in future energy
prices, these investments are likely to be postponed further. Interestingly, the current military regime has very
recently given signals in which they state they want to reduce energy subsidies and let energy prices reflect better
their real costs (thus implying increasing energy prices).
1
2
In order to increase the relevance of the survey for the GIZ project TGP-EEDP, another 39 questionnaires were sent to the
non-energy intensive food sector. Overall response rate was 27.4%. In this report the authors only present findings for the
iron and steel industry. Results of the surveys in all industries are published in Landgraf, R.(2014).
NEEDS ASSESSMENT: ENERGY EFFICIENT TECHNOLOGIES FOR THE IRON AND STEEL SECTOR IN THAILAND
Figure 2: Top 6 barriers to energy efficiency scored by iron and steel respondents
Moreover, the respondents see that the energy managers do not have enough influence within their companies.
Other departments within the companies are more important and have more power to make company decisions.
The level of power of an energy manager within an organisation is crucial, as he or she is responsible for pushing
energy efficiency investments forward. In addition, if staff is only insufficiently trained, as described in barrier
“Insufficient training of staff”, they cannot implement energy efficiency measures effectively. Even if they want to
follow orders from the energy managers, they may be not able to do so.
Further relevant barriers for the steel industry are “Insufficient internal capital budget” and “General political and
economic situation”. The first refers to the economic situation of most steel producing companies. The iron and
steel sector is challenged by a world-wide overproduction of steel and a high level of competition especially from
Chinese steel exporters. This yields to decreasing profit margins and makes external financing, especially for larger
investments, more difficult. The difficult market environment is the reason for this high score. Low profit margins
are responsible for a low amount of equity positions and hinder investments – energy efficiency investments are, of
course, no exception. The other barrier “General political and economic situation” refers to the same problem, as
the general economic situation of Thailand influences the market environment for steel producing companies. Also,
political decisions, especially on energy or trade issues, can greatly influence businesses. In addition, considering
the political unrest in Thailand at the time the survey was conducted, this fact is likely to have driven the high
scoring.
3
Furthermore, the survey asked for drivers of energy efficiency in the Thai iron and steel sector (Figure 3). The
driver “Reducing Energy Bill” was considered to be the most important according to respondents in the iron and
steel industry, with an average score of 4.33. The driver “Expectation of increasing future energy prices” is ranked
as the second most important, with an average score of 4.0. Both drivers are different in terms of time. Driver
“Reducing Energy Bill” addresses high current energy bills whereas driver “Expectation of increasing future energy
prices” addresses future energy prices and therefore future energy bills. In other words, high energy costs today are
considered more important drivers for the adoption of energy efficiency technologies than potential high energy
costs in the future. This result represents the dynamic dimension of energy efficiency investments.
Figure 3: Drivers for energy efficiency in the Thai iron and steel sector
4
NEEDS ASSESSMENT: ENERGY EFFICIENT TECHNOLOGIES FOR THE IRON AND STEEL SECTOR IN THAILAND
3. Consulting actions iron and steel sector Thailand
Over the course of the past months, there have been several encounters between the Iron and Steel Institute of
Thailand (ISIT), the branch association of the iron and steel sector in Thailand, and the GIZ team members.
On 28 October 2013, a first meeting with ISIT took place, in which ISIT introduced their plan to develop an energy
efficiency action plan for the iron and steel industry in Thailand and their search for international experiences on
energy efficiency policies addressing energy intensive industries2. At that occasion, the GIZ team offered help in
identifying best practice examples of realising energy efficiency in the industry sector in Germany. Follow-up
communication took place on 12 November 2013 by offering an overview of energy efficiency regulations in the EU
and Germany for energy intensive industries, including links for more information (Annex 1).
Further follow-up took place on 14 November, when the GIZ introduced knowledge on sector guidelines on
improvement of energy, environment, and safety aspects, and conduct capacity building measures (trainings and
consulting services) for specific target groups.
Furthermore, Mr Pasin Placksiri was interviewed as part of the sector analysis in January 2014.
On 24 March 2014, a meeting was set up between ISIT and the GIZ team to continue the discussion on encouragement
of energy efficiency in the iron and steel sector in Thailand and how synergies can be created by collaborating on this
topic3. In the meeting the state of affairs of the ISIT “5 Year Action Plan” for the iron and steel industry was discussed
as well as the ISIT ESCO project where the aim is to facilitate ESCO services in the steel industry. GIZ explained in
which areas it could support ISIT. One of the interesting topics of discussion was the work that ISIT was about to
conduct in analysing the needs and interest for energy efficiency technologies by surveying 30 of their member
factories. It was decided that GIZ would be further involved in this process (further steps described under section
4.2).
Present in this meeting were Mr Nattapon Ratanamalee (ISIT); Mr Pasin Placksiri (ISIT), Mr Thomas Chrometzka (GIZ) and Ms
Milou Beerepoot (GIZ)
3
Present in this meeting were Mr Hin Navawongse (ISIT), Mr Pasit Placksiri (ISIT); Mr Monthon Kumpaengseth (GIZ), Mr
Supalerk Kanasook (GIZ), Mr Karun Pantong (GIZ), Gisa Holzhausen (GIZ), Dr. Milou Beerepoot (GIZ), Thomas
Chrometzka (GIZ)
2
5
4. Needs assessment iron and steel sector Thailand
4.1
Energy Efficiency Technology assessment survey
In the survey conducted amongst iron and steel industries (as described in Chapter 2), one of the questions referred
to energy efficiency technologies. Respondents were asked to select energy efficiency technologies which are already
implemented in their companies in order to discover the current and planned technologies used by iron and steel
companies. The list of selected technologies was based on earlier research (U-nontakarn, 2012) and included:
1.
Insulation
2. VSD (variable-speed drive) for Fan & Pump
3. Power Management (PM)
4. Cogeneration
5. O2 Control
6. Waste Heat Recovery
7.
High Efficiency Burners (like Regenerative burners, Recuperative burners, Oxy fuel, Low NOx burners)
8. High Efficiency Electric Arc Furnace (EAF)
9. Operation Optimization and Control
10. Hot Charging System
The respondents were asked which energy efficient technologies the company already installed and which
technologies were planned or not (yet) planned. The first 5 technologies (nr 1 to 5) listed above are basic technologies
that are easy to implement, the following 5 (nr 6 to 10) can be defined as advanced technologies.
The results show that four out of five basic technologies are already widely installed. One basic technology,
Cogeneration, is not installed in the steel companies participating in the survey. Advanced technologies which are
already installed on a small scale are Waste Heat Recovery systems. All listed technologies for steel companies are
already planned or under discussion. Therefore, the current technology mix shows that most basic technologies are
widely installed already, and demand for advanced technologies does exist.
4.2
Energy Efficiency Technology assessment ISIT
As a result of the consulting actions of GIZ to ISIT, GIZ was involved in the discussion in ISIT regarding most suitable
energy efficiency technologies for the iron and steel sector in Thailand. After a general agreement between GIZ and
ISIT on the basis of a meeting on 24 March 2014, a follow-up meeting took place e.g. on 21 April 2014 to further
identify the needs of the iron and steel sector on energy efficiency technology interest. On the basis of discussing
ISIT’s analysis of interest and priority of energy efficiency technologies based on interviews and questionnaires
amongst their members, a technology priority list could be identified as shown in Annex 2. On 16 May, the GIZ team
participated and contributed to a focus group meeting to share ideas and provide suggestions on ISIT's 5-year EE
Action Plan for which an important part of the meeting was to discuss about EE technology. Another such focus group
6
NEEDS ASSESSMENT: ENERGY EFFICIENT TECHNOLOGIES FOR THE IRON AND STEEL SECTOR IN THAILAND
meeting with participation of the GIZ team took place on 30 May 2014. On the basis of the discussion regarding the
exercise on priority analysis of energy efficiency technology at ISIT (Annex 2), the technologies ranked as 1st priority
seem to be most relevant for first consultation activities.
Comparing the list of selected technologies in the survey (section 4.1) with the list of technologies in the priority
analysis of ISIT is showing some parallels. However, the list of technologies as listed in the ISIT analysis has a much
more detailed level than the more general list of technologies in the survey and can therefore not exactly be compared.
Given the fact that the first 5 technologies in the survey are already state of the art technologies, as confirmed by the
survey, these are not explicitly listed in the ISIT analysis. Regarding the “advanced technologies” in the survey,
Energy Efficiency Technology in Electric Arc Furnace Steelmaking Process is listed as 1st priority in the ISIT analysis
and is indicated as a technology of interest in the survey. Different types of high efficiency burners have been ranked
as 1st or 2nd priority in the ISIT analysis and as a technology of interest in the survey. Hot charging systems, a
technology of interest as indicated in the survey, have been split up in the ISIT analysis in different technologies and
were ranked as 1st, 2nd and 3rd priorities, depending on the specific type of technology
4.3
Results
On the basis of the survey results as well as the exchange of ideas between ISIT and GIZ, potential energy efficiency
technologies to be introduced in the iron and steel sector as well as priorities for consultation on energy efficiency for
the iron and steel sector can be identified. On the basis of the survey results, cogeneration seems to be a basic energy
efficiency technology that is not yet widely deployed while the other 4 basic technologies are already in place. The
more advanced EE technologies are all planned to be implemented and could therefore be suitable candidates for
consultation towards the iron and steel sector in Thailand. On the basis of the discussion regarding the ongoing
priority analysis of energy efficiency technology at ISIT (Annex 2), the technologies ranked as 1st priority seem to be
most relevant for first consultation activities.
7
5. Conclusions
The Thai Government is aiming to reduce energy intensity in 2030 by 25% (compared to 2010). Since the industry –
especially the energy intensive industry – is an important sector for realising energy efficiency in Thailand, this needs
assessment was conducted to support and identify how the industry can benefit from energy savings. The assessment
shows that the iron and steel sector in Thailand has undertaken several measures to identify technology solutions
that could be implemented in the sector to tap energy efficiency potentials.
Based on the results of the assessment and the wish of ISIT for more support when it comes to technology transfer
the Project Development Programme is aiming to initiate close cooperation with the German Engineering Federation
(VDMA). VDMA represents over 3,100 mainly small/medium size member companies in the engineering industry in
Germany, making it one of the largest and most important industrial associations in Europe. Since VDMA covers the
entire process chain (from components and plant manufacturers, system suppliers and system integrators to service
providers) the association has specialized subgroups e.g. the thermo process technology group (http://tpt.vdma.org/)
and the metallurgical plants and rolling mills group (http://huw.vdma.org/en/home). ISIT could greatly benefit from
a close cooperation in regard to VDMA’s institutional knowledge, as well as their members’ expertise.
In a next step, the Project Development Programme will organize a symposium for both associations and their
members. On the basis of the technologies identified in chapter 4.3 further cooperation between German and Thai
companies will be supported.
8
NEEDS ASSESSMENT: ENERGY EFFICIENT TECHNOLOGIES FOR THE IRON AND STEEL SECTOR IN THAILAND
6. References
EPPO. 2011. Thailand 20-Year Energy Efficiency Development Plan (2011 -2030), Energy Policy and Planning
Office (EPPO), Ministry of Energy, Bangkok.
ISIT. 2012. Investment opportunity in the iron and steel, petrochemical and food processing industry; presentation
from Iron and Steel Institute of Thailand (ISIT), URL http://www.giz.de/fachexpertise/downloads/ 2012-enwikrom-pep-informationsworkshop-thailand-eneff.pdf. [Retrieved on March 10, 2014].
Landgraf, R., 2014, Promoting energy efficiency in the Thai Industrial sector: sector analysis and assessment of the
planned EPC scheme, Potsdam
U-nontakarn, P. 2012. Energy efficiency potential in thai industries, URL
http://thailand.ahk.de/fileadmin/ahk_thailand/projects/
energyefficiencydelegation/05_analysis_of_energy_efficiency_potential_in_thai_industries_bright_unontakarn.
pdf.
9
Annex 1
1. Overview of EE policies for the industry sector in the EU and Germany
1. EU Regulations:
EU Directive: 2012/27/EU
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2012:315:0001:0056:EN:PDF
-
Large energy intensive companies are legally obligated to undertake an energy audit every 4 years. Audit
manager can be external or internal. If an internal audit manager is chosen, neutrality has to be assured,
e.g. audit manager should not to be directly engaged in the activity audited.
-
EU ETS (Emission Trading System), mandatory system for the energy producing sector as well as for
energy intensive industries as refineries, coke ovens, iron and steel, cement, glass, ceramics, pulp and paper
etc.;
o
marked-based system with a cap on carbon emissions
o
the third trading period (2013-2020) just began. Biggest change: the cap will now be reduced
automatically by 1.74% each year.
o
at first the certificates were mostly allocated free, now a progressive shift towards auctioning has
been undertaken
o
A fund fed by the EU ETS supports energy efficiency projects (amongst others)
More about EU ETS: http://ec.europa.eu/clima/policies/ets/
-
Eco-design guideline: set rules or voluntary agreements on the eco-design of energy related products
(excluding vehicles). The most famous example is the ban of energy inefficient lighting in households.
More about eco design: http://ec.europa.eu/energy/efficiency/ecodesign/eco_design_en.htm
-
Energy efficient companies are favored in public award procedures and public purchasing (EU Directive:
2012/27/EU Article 6)
2. German Regulations:
http://www.iea.org/policiesandmeasures/energyefficiency/?country=Germany
http://www.ahk.es/fileadmin/ahk_spanien/Jornadas/III_Jornada_HispanoAlemana/Ponencias_III_Jornada_HA_Eficiencia_Energetica/02_Ecofys_-_Sven_Schirmschar.pdf
-
Financial support for the introduction of Energy Management Systems in energy intensive enterprises
(which follow DIN EN ISO 50001)
-
Loans with low interest rates for investments in EE for SMEs
-
For promotion of cogeneration of heat and power regulatory mandatory targets and financial incentives are
in place
-
10
Financial support of Research and Development
NEEDS ASSESSMENT: ENERGY EFFICIENT TECHNOLOGIES FOR THE IRON AND STEEL SECTOR IN THAILAND
-
Support for EE pilot projects, e.g.: In July 2013 “Wulf Zargen GmbH & Co. KG“, a steel architrave producer,
has successfully introduced an innovative software, which helps reducing energy and resource consumption
significantly. This pilot project was supported by the German Ministry of Environment with 750,000 Euro.
-
Technological Standards, e.g. Limits on emissions and waste gases lost allowed on small and medium sized
firing installations
-
Regulations for the construction of industry buildings
-
Information campaigns, e.g. “Initiative Energieeffizienz” managed from the German Energy Agency
http://www.dena.de/en/projects/electricity/initiative-energieeffizienz-energy-efficiency-campaign.html
-
Energy intensive industries can benefit from tax credits if they show engagement in energy efficiency
-
Financial support of EE alliances of enterprises and support of energy efficiency consultations
o
The idea is, that local companies form a network and cooperate in terms of energy efficiency
o
Benefits: improve expertise, cost-efficient training for energy managers, minimizing search and
decision making costs,
 On average (in Germany): Participating companies have double of energy efficiency
progress than industry average and they reduce annual energy costs by 220,000 Euro.
o
EE networks are successfully implemented in China (by State Grid Corporation of China (SGCC) in
cooperation with GIZ), 573 networks with ca. 6000 participating companies, for more information
see attached presentation
11
Annex 2
Priority Analysis of Energy Efficiency Technology required by the Steel Industry in
Thailand
(Source: ISIT)
1st Priority
2nd Priority
Energy Efficiency Technology in Electric Arc Furnace Steelmaking Process
Scrap Preheating
Slag foaming
Using C from plastic and tires
Neural Network
Efficient Ladle & Tundish
Scrap Management
Preheater
Energy Efficiency Technology in Hot Rolled Coil Process
Direct rolling and Hot charge
Emulsion Fuel
High Efficiency recuperator
Insulation of Furnace
Advance Descaling Nozzle
Air Compressor for Atomize air
Combustion Setting
Oxygen Enrichment
3rd Priority
Continuous scrap feeding
Ladle-EAF synchronization
Biomass Thermal
gasification
Roller water cooling bottom
furnace
Emisspro
Process Control
Energy Efficiency Technology in Cold Rolled, Coated steel and pipe steel Process
Combine line (Coated & Colour
Turbulent Pickling
Ball Blowing Type
coated)
Solid State Welding
Solar Water Heater
Submerged Combustion Burner
Energy Efficiency Technology for Utilities
Cooling Tower
VSD –AC, CT, Chiller, Pump
Oxy-Fuel Burner
Pump Management
Regenerative Burner
Solar PV
Boiler
LED Light
Compressed Air Management
Biomass Boiler
Combustion Setting
Waste Heat Recovery
High Efficiency Recuperator
Remark: The list in the table will be updated after a final stakeholder meeting.
VSD: Variable Speed Drive
AC: Air Compressor
CT: Cooling Tower
12

Download Report