Evaluation and implementation of DSM strategies to improve the profitability of marginal cement grinding plants

Abstract

The cement industry in South Africa is becoming increasingly competitive. Established cement producers have old inefficient production plants that have to compete with new cement producers abroad. These new cement companies are entering South Africa with more energy efficient production equipment that gives them an advantage when the current increases in electricity tariffs are considered. Established local cement plants have to investigate new initiatives to become more competitive. Replacing old and inefficient equipment with modern energy-efficient equipment is in most cases not a viable option. This is due to the large initial capital expenditure, long payback periods and installation downtime. Cement producers must rather aim to decrease their energy consumption with minimal capital expenditure and zero influence on production output, quality or safety. Established cement grinding plants are among the industries most affected by steep electricity tariff increases. In most cases the pre-clinker processes of marginal plants are already decommissioned and thus the majority of these operations focuses on performing finishing/cement milling due to the plants geographic distribution advantage. These plants seldom run at full capacity as a result of inefficiencies. This spare capacity can, therefore, be utilised by implementing demand-side management electricity savings initiatives. Load management was proven a cost-effective method for reducing energy costs on marginal cement grinding plants. Load management takes advantage of Eskom’s time-of-use tariff structures by shifting the operation of electricity intensive components from high demand (high cost) periods to low demand (low cost) periods while still maintaining the same production output. Effective load management will reduce electricity cost without influencing production output, quality or safety. An effective load management method was researched and implemented on two marginal cement grinding stations. Previous evaluation strategies have not created a platform on which the performances of different cement plants could be compared; therefore, a more comprehensive method for evaluating load management was developed. The evaluation strategy analyses the reduced electricity cost and compares it with the electricity cost of a more modern cement grinding plant to determine whether the marginal cement plant remains competitive. In this study, the electricity costs of marginal cement plants are lowered by more than 10% by executing the proposed load management strategy. The evaluation strategy also found that load management could improve a marginal cement grinding plant’s electricity cost intensity to such an extent that the electricity cost differs by only 1% when compared with modern cement grinding plants operating as per normal production schedules. Load management was, therefore, a cost-effective solution to reduce electricity costs on marginal cement grinding plants and remains competitive with modern cement grinding plants.