If the ‘80s and ‘90s were about building bigger and better, the 2020s have brought into sharp focus the impact that global overconsumption is having on our environment and society. According to the OECD, we will need 2.3 planets to meet our material resource needs by 2040 if we continue to grow consumption at the current pace. Tackling the throwaway culture of past decades is more than just the latest sustainability trend, it is a huge opportunity for forward-thinking, innovative companies to identify new areas of growth and operational efficiency gain. Here, I explain why extending the life cycle of resources that are already in service is both good business and good for business.
The circular economy is an economic concept that supplants our throwaway culture by prioritizing – among other factors – the lifetime extension, material reduction, and reuse and recycling of products. In contrast to the traditional linear model of “take-make-dispose,” in a circular economy we keep resources in use for as long as possible, extracting the maximum value from them, and then recovering and regenerating products and materials at the end of their useful life.
Encouraging Product Durability and Repairability
Industries across the world are facing unprecedented environmental and economic challenges driven by the accelerating effects of the climate crisis, the aftershocks of a generational global pandemic, rising inflation, and real risks of energy and supply chain disruption. Indeed, ABB’s Energy Insights survey of 2,300 large and small businesses worldwide revealed that 92 percent of business leaders are concerned about the threat energy costs pose to the profitability and competitiveness of their business, with 74 percent having taken some action, or looking at potential actions, to mitigate fluctuating energy costs and security.
Increased focus and pressure on energy costs have encouraged companies to put their electrical power distribution assets under closer scrutiny. With this threat in mind, one approach that is taking hold among forward-thinking organizations is intelligent, preventative service and support. Rather than seeing service as a reactive intervention, they are recognizing that running a piece of critical equipment to the point of failure could cost up to 10 times more than investing in a program of regular maintenance to extend the life cycle and productivity of electrical assets, in addition to avoiding the environmental impact of buying new equipment.
One of the greatest opportunities for savings on carbon, material and cost is retrofitting – upgrading outdated components so that the existing electrical system lasts much longer and is running as efficiently as possible, which in turn minimizes the risks of breakdowns and expensive downtime.
In fact, 50 percent of electrical equipment like metal cabinets, steel plates and busbars – products with high embedded carbon and material footprints – can be used perpetually without being replaced if outdated components such as circuit breakers, electrical switches, fuses and contactors are regularly monitored, maintained and upgraded.
Extending the Life Cycle of Equipment by up to Three Decades
With this approach, we have seen some of ABB’s clients’ facilities reduce the cost of operating equipment by a third while extending the lifetime of critical infrastructure by as much as 30 years. In terms of best practice, early adopters are taking a preventative approach, replacing older, non-digital circuit breakers with more intelligent, digitally enabled breakers linked to cloud-computing platforms that enable the seamless provision of value-added services.
These can provide real-time data and analysis on asset condition, performance and potential safety issues, helping operators prevent potential hazards before they arise and minimizing disruptions to production.
For example, when two of Finland’s biggest hydropower plants, located in the Arctic Circle and operated by Kemijoki Oy, wanted to upgrade their dated circuit breakers, ABB proposed and installed a retrofit solution, which avoided having to replace the entire switchgear operation.
The plants – Matarakoski completed in 1995 and Kelukoski in 2001 – have an 11 MW output and power some 10,000 family homes between them. They had been running on their original SF6-based HPA circuit breakers and, despite being technically competent, the aging circuit breakers were no longer in line with Kemijoki’s strict environmental diversification program.
Lack of available spare parts was also becoming an issue for breakers that had been in commission for around 30 years. Another consideration was the key part Kemijoki hydropower plays in the country’s energy security and production, meaning downtime had to be kept to a minimum.
A customized 12kV version of the ABB medium-voltage VD4G vacuum circuit breaker family was specified, which clears potentially harmful short-circuit faults in tens of milliseconds, thereby preventing severe damage and lengthy plant downtime. The retrofit solution also meant downtime was reduced to hours rather than weeks, ensuring the power was kept on without any disruption.
Kemijoki Oy is a great example of an operator that is embracing the circular economy. The project demonstrates the integral role a strong servicing partnership can play in helping companies achieve their sustainability goals. The retrofit solution was achieved because of the close working relationship between ABB and Kemijoki Oy, which saw the value of bringing in an expert servicing partner to inspect, analyze and evaluate the health of its electrical equipment, before suggesting a bespoke solution.
Such partnerships can show where energy use can be optimized, or where equipment requires maintenance and simple and cost-effective fixes to lower energy consumption and reduce the risk of outages. In heavy industries such as oil and gas, or tightly controlled industrial environments such as food and beverage manufacturing, this is business critical as even a brief black-out can result in severe production losses, with devastating knock-on impacts on revenue.
And this is where retrofitting equipment with more advanced, digitally enabled products and systems is really taking off.
Digital solutions, such as ABB’s Ability™ Energy and Asset Manager, which have monitoring and diagnostic capabilities, offer companies the potential to shift to a new, predictive, proactive model of maintaining their equipment. At present, the norm for many companies is to let their electrical equipment run for a few years before shutting down for one or two weeks to check for any issues. But, with condition-based maintenance, the equipment itself identifies whether something is outside of normal parameters, so issues can be addressed before they become failures.
Such an “intelligent” approach not only makes financial sense, but also ensures that the lifetime of machinery is optimized, with equipment failures and production stoppages minimalized.
The bottom line is that by tackling throwaway culture and adopting the principles of a circular economy brings many business benefits, including cost savings, improved productivity and output, reduced environmental impact and increased innovation. Retrofitting is something many commercial operators have been talking about for years but now just might be the time they finally feel the urgency to implement it.
Dr. Matthew Wise (Matt) is the head of strategy and business development at ABB’s electrification service division, based in Zurich, Switzerland.
Wise is responsible for driving the strategy, sustainability and business growth agenda of ABB’s newest division, which was created at the beginning of 2022, to bring into greater focus service’s role to improve the availability, reliability, predictability and sustainability of electrical infrastructure globally.
Prior to this, he held multiple roles in ABB’s corporate and business area strategy teams, and, most recently, was responsible for driving the implementation of ABB Electrification’s 2030 sustainability target framework.
Before joining ABB, Wise worked as a management consultant in the London office of Marakon, a boutique strategy advisory firm.
He holds a Master of Chemistry degree from Oxford University and completed a doctorate in supramolecular chemistry at the École Polytechnique Fédérale de Lausanne (EPFL).