CHICAGO — The key performance indicators (KPI; also called metrics) in the laundry industry are labor, inventory and utilities.
Each of those metrics can be positively affected to make improvements in the bottom line of a laundry business. When it comes to utilities—electricity, water and natural gas—there are practical steps that a laundry can take to see lowered usage and increased savings.
David Bernstein, president of Lapauw USA, addressed the topic of improving utility usage during the Association for Linen Management (ALM) webinar called Key Performance Indicators in Utility Management.
“As we talk about utilities in our facilities, we’re going to answer some specific questions in regards to each of these utilities. How and what should I track? How much do I use? How much does it cost? What can I do to positively impact those metrics?” says Bernstein.
HOW TO TRACK
Bernstein says that the first thing a laundry needs to do when it comes to utility management is to set a benchmark.
He recommends that, every day, laundries have somebody in the facility go out to each of the meters for each utility. Take meter readings at the same time every day. Write them down, and at least weekly put them into a spreadsheet to start tracking usage, based on pounds processed on a daily basis, he says.
“Going out and taking readings is a very important thing to do because you only get your utility bills, and when you get your utility bill, unless you’re taking meter readings, you’re at the mercy of your utility company,” he says.
He says that laundries that take meter readings can compare those readings against the utility bills.
Beyond looking at meter readings for the entire facility and the utility bills, Bernstein says laundries also have the opportunity to put meters on individual machines.
“I was in a plant in Texas where each of their dryers had an individual gas meter so they could track on a dryer-by-dryer basis the efficiency of those machines,” he says. “Maintenance was able to use that as a leading indicator to tell them when it was going to be time to do some maintenance on those pieces of equipment.”
Bernstein notes that there are many automated systems on the market, and there are several companies that will not only go out and monitor the productivity of the plant, but can also monitor utility usage in a plant. In addition, there are centralized systems that can be installed in a plant.
“There are a lot of ways you can track, but the main thing you should be doing, in my opinion, is set up a spreadsheet so you can track exactly at the same time every day your meter reading, so you can track what your usage was from day-to-day, month-to-month and year-to-year,” he says.
WHAT TO TRACK
What is it that a laundry should be tracking as it looks at each of these types of utilities?
“We have demand and we have usage and we have the KPI we’re going to look at to determine the health of our facility. KPIs are really no different than when you go to your doctor’s office,” says Bernstein.
For electricity, he says that on the demand basis, a laundry is going to look at kilowatts.
“You have peaks and you have valleys, and over time you end up using a certain number of kilowatts, and so the usage, what you see on your electric bill, is those kilowatt-hours, that’s the usage of kilowatts over time,” says Bernstein. “And that leads us to the important metric when we talk about electricity: kilowatt-hours per pound.”
The metrics are similar when it comes to tracking water and natural gas usage. For water, the demand is gallons per hour, and the key performance indicator is gallons per pound. For gas, Btu is the demand, Btu per hour is usage, and Btu per pound is the key performance indicator to look at.
TRACKING AND INFLUENCING ELECTRICAL USAGE
For each utility, Bernstein recommends carefully examining the bill received. On the electric bill, a laundry will see two entries: demand and usage. Usage is the amount of electricity used over time.
“Then you’ve got the demand charge,” he says. “Your electric company is going to monitor those peaks and valleys in your request, if you will, for power. For instance, if you start up a motor and your motor doesn’t have an inverter or a variable-frequency drive, it’s going to require a large inrush of current to get that motor running.
"If you have a bank of motors, a bank of washers, let’s say you start all of those washers at the same time and then at some point, they all go into extract at the same time, those motors are going to be requiring a lot of power all at once, so the demand for electricity looks to the electric company to be very, very high. Your demand charge is based upon how much electricity you try to use in a very short period of time.”
Bernstein’s first piece of practical advice to lower the usage of electricity is for laundries to stagger startups. By staggering equipment startup, a laundry’s demand to the electric company will appear to be lower, resulting in a lower demand charge.
Also, a laundry will see on its bill, as well as on the meter, something called a multiplier or a correction factor. Bernstein says laundries need to know what this is in order for their tracking numbers to come close to what the utility company is going to charge.
“Knowing these metrics allows us to create charts to look at our usage over time to figure out why you are using more electricity,” he says.
How much electricity a laundry uses depends upon several factors, says Bernstein.
“The kind of equipment you have in use, for example, if you have a vacuum soil-sort system, that’s a lot of motors creating quite a few horsepower in order to move product from one place to another,” he says. “Your washer-extractors, depending on how many motors they have. Air compressors are a big user of electricity in facilities. Older lighting, you may find there is a very fast return on investment for replacing older lighting with high-efficiency lighting.”
Another way a laundry can save money on electricity is rate mitigation.
“You may recall a few years ago in California, they had rolling blackouts,” says Bernstein. “There simply wasn’t enough power to meet the summertime demand. So they went to industrial users and said, ‘We’ll make you a deal, if you will switch your hours to our low-demand off-peak hours for electricity demand, we’ll give you a discount for every day that you do that.’
“There was a large healthcare launderer in the L.A. basin who did take advantage of that. They switched from a daytime shift to an evening shift and they saved a lot of money.”
Another way to possibly save money, Bernstein says, is for a laundry to verify that it’s on the right rate schedule. He says that if a laundry hasn’t spoken with a utility representative for a while, call and have him or her come in and make sure that it’s being billed on the right rate schedule.
“Maybe when you opened your facility, you were only doing 3 million pounds. Now you’re doing 8 million pounds,” he says. “It’s possible that there may be some discounts and incentives because now you’re a larger user that you’re not taking advantage of. This goes for electricity, gas and water.”
Bernstein says that there are several other simple ways for a plant to reduce electricity usage. Turn off both lights and equipment when not in use, and load washroom equipment properly.
Finally, he stresses that with all three utilities, proper maintenance is always key.
“People know about lubrication and belts and all of those kinds of things, but what some people don’t realize is even loose electrical connections actually use more energy than really tight and clean electrical connections,” Bernstein says. “That’s something that your engineering staff should be checking on a regular basis.”
Check back Thursday for tips on water and gas usage.
Have a question or comment? E-mail our editor Matt Poe at [email protected].