U.S. manufacturing has been making progress in reducing its energy intensity, reports the Energy Information Administration (EIA). In its eighth Manufacturing Energy Consumption Survey (MECS), the EIA found that from 2010 to 2014, manufacturing fuel consumption increased by 4.7 percent, while real gross output increased by 9.6 percent—or more than twice that rate—resulting in a 4.4 percent decrease in energy intensity.
Some of the improvement results from efforts by manufacturers to lower their energy consumption. However, the EIA found that the majority of the change resulted from a slowdown in the most energy-intensive industries and an uptick in output from sectors that are less energy intensive, particularly the manufacture of transportation equipment.
Energy Per Unit of Output
Energy intensity is the ratio of energy use to output or the quantity of energy required to perform a particular activity expressed as energy per unit of output or activity. Sector-specific intensities may refer to energy consumption per household, per unit of commercial floorspace, per dollar value of industrial shipment, or another metric indicative of a sector. Improvements in energy intensity result from energy efficiency and conservation as well as structural factors not related to technology or behavior.
15,000 Establishments Sampled
The latest MECS release provides manufacturing energy consumption, energy expenditures, and other energy-related metrics based on data collected in 2015, which reflects activity in 2014. The EIA has conducted the MECS survey eight times since the initial MECS in 1985. The 2014 MECS sample size of approximately 15,000 establishments was drawn from a sample frame representing 97 percent to 98 percent of the national manufacturing payroll.
Manufacturing Shift
The EIA notes that while many manufacturing establishments are taking steps to reduce their energy consumption, the energy-intensity decrease for total manufacturing is mostly the result of a shift of manufacturing output from energy-intensive industries, such as the manufacture of metals, chemicals, paper, and petroleum and coal products, to less energy-intensive industries. If major industries had maintained the same proportions of the manufacturing sector, the energy-intensity decline between 2010 and 2014 would have been 0.7 percent instead of 4.4 percent, says the EIA.
The EIA says transportation equipment manufacturing, an industry with a relatively low energy intensity, was one of the fastest growing sectors in the period reviewed. Gross output in transportation equipment manufacturing grew 30.8 percent, much faster than the 9.6 percent increase in overall manufacturing output between 2010 and 2014.
Natural Gas
Considering fuel use, natural gas made up a larger share of manufacturing use, while fuels such as coal and coke, fuel oil, and other petroleum liquids made up smaller shares. Natural gas consumption for manufacturing was 5.9 quadrillion British thermal units (Btu) in 2014, or 39 percent of the total fuel use in manufacturing, compared with 37 percent in 2010. On an economic basis, natural gas has become more cost-competitive with coal and requires lower expenditures per unit of energy than fuel oil or liquefied petroleum gas.
In addition, natural gas boilers emit fewer environmental pollutants per Btu than those that use coal and other common fossil fuels.
“As such, manufacturers may be able to avoid the expenses associated with pollutant mitigation and follow-up as required by regulations such as the EPA’s boiler maximum achievable control technology (MACT) standards,” says the EIA. “Natural gas combustion is not subject to the same restrictions under the boiler MACT that apply to coal, oil-based fuels, and biomass.”
Employment
The EIA found that although manufacturing output and fuel consumption rose between 2010 and 2014, U.S. manufacturing employment decreased over that period, yielding an increase in labor productivity.
“Manufacturing processes continue to evolve, incorporating more electronic and robotic devices each year, which may be a direct factor in increased labor productivity,” said the EIA.
More information on the latest MECS is here.