The surprising reason why American manufacturing is getting greener.
Ken Silverstein is editor-in-chief of Public Utilities Fortnightly. Contact him at email@example.com.
Natural gas, which not long ago was thought to be in short supply, has transformed electric generation, allowing it to be cleaner and more efficient. The main beneficiaries are manufacturers, which are voracious consumers of energy, but which now can choose where to get it - from utilities, or by generating it themselves.
Consider Proctor & Gamble, which takes advantage of a type of on-site generation called "combined heat and power," a process that yields both kilowatt-hours and useful heat as byproduct. P&G's Wyoming County, Pennsylvania manufacturing facility also enjoys easy access to the nearby Marcellus Shale region - all of which has improved the company's finances and its environmental record.
Proctor & Gamble's on-site operations now are more efficient than if it had bought power from central-station utility generators, which lose energy as it travels through the transmission network. In fact, conventional generation has an efficiency rate of about 51 percent, whereas the CHP units like the ones used by the consumer product maker can achieve 75 percent, says ICF International.
About 82,000 megawatts of installed onsite CHP now exists across the country at almost 4,000 industrial and commercial facilities, adds ICF. That's about 8 percent of the U.S. electric generation base.