NEG reduces operational costs with guaranteed energy savings from Siemens

Dedicated to practising sustainable manufacturing, Nippon Electric Glass (NEG) wanted to invest in its Wigan facility to become more energy efficient and improve operational efficiencies in incumbent processes and equipment.

Steve Keeton, Managing Director at NEG explains, “For over a decade we’ve been conscious of the requirement for energy efficiency. Not just because we’re such a high energy intensive user and it costs a lot of money but also because of the wider moral and ethical dilemmas around the amount of energy we use ourselves, particularly from carbon sources.

“So we buy ethically and there’s a nod to circularity because 50% of our product goes into wind turbine blades but we wanted to level up and invest in improving energy-efficiency at our Wigan site.”

The business turned to Siemens to analyse factory processes and recommend a strategic approach to enhancing its energy use. After a full assessment of the Wigan facility, Siemens identified key areas where processes and equipment could be implemented to refine efficiency. This included installing new Siemens motors and controllers, new water pumps, flow meters and replacement of nearly 3000 LED light fittings.

Drawing on the expertise of its financing arm – Siemens Financial Services (SFS) – Siemens guaranteed the expected savings over the course of the five-year contract.

“Typically you’d just do one project at a time and try to justify it on its own merits. That means the smaller more complicated ones are often left on the sidelines. But SFS enabled us to package these altogether into one regular payment,” noted Keeton.

“What’s more we didn’t have to start repaying the finance until we’d seen the benefit of the projects. So the benefit was all frontloaded for us. Only when the verified savings came in did we start repaying the lease. We’ve actually managed to achieve more savings than those guaranteed so not only did the team at Siemens exceed expectations but we’ve also been able to bolt-on further projects since.”

Under the energy performance contracting agreement, the end-to-end solution from Siemens spread NEG’s payments over the five-year term to align with the guaranteed savings, effectively making the investment net zero cost. With the installation of the technology, NEG is now seeing significant reductions in operating costs, totalling around EUR 3 million across the financing period.

“Because the Siemens teams were ideal partners for us, we’ve spun a new project out of this relationship. We are now working on the business case for a digital twin which will help us to identify bottlenecks and other critical areas. It really makes a difference working with people who understand the industry so well and who help make investment in greener processes affordable.”

Carolyn Newsham, Digital Industries Financing Partner, Siemens Financial Services GB&I, “By leveraging the full force of digitalisation and the Siemens family, NEG was able to structure investment around reliable savings estimations. This has not only produced major savings in both financial and energy terms but also paved the way for future projects to continue to reduce its carbon footprint.”