The “invisible” nature of energy efficiency in the refining business means that these benefits are usually not noticed by the general public. Rather, this type of energy efficiency is reflected in the daily decision-making processes of a refinery’s operators and engineers, the upgrades to various pieces of equipment, and the daily disciplines of the operators.
National recognition of ongoing operational discipline
While many of these daily and weekly efficiencies will never make headlines in newspapers or magazines, over time, these types of incremental decisions add up. For Marathon Petroleum, this consistent focus has resulted in receiving significant national recognition of the company’s long-term efforts to improve operational efficiency versus the development of a single large-scale project.
Marathon Petroleum announced that six of its refineries have received the U.S. Environmental Protection Agency (EPA) ENERGY STAR designation for superior energy efficiency. These designations place these six refineries in the upper echelon of all refineries in the United States, in terms of converting energy inputs into output products. Although the recognition itself is new, the underlying work was done over many years.
EPA awards the ENERGY STAR designation only to facilities that have demonstrated exceptional levels of performance, relative to their peer group, in addition to demonstrating performance well above average levels in the industry. Therefore, the ENERGY STAR designation represents the continued demonstration of high performance, rather than a recent change.
For Marathon Petroleum, the announcement provides evidence that the cumulative effect of all of the energy efficiency improvements that have been developed over the past several years is now quantifiable through an independent third party (the EPA).
What ENERGY STAR certification actually measures
The ENERGY STAR designation is not awarded to a single piece of equipment or a single energy-saving project. Rather, the designation represents how a complete refinery facility operates. A refinery receives the ENERGY STAR designation if it demonstrates that it produces the same output with significantly fewer energy inputs.
The reduction in energy use results in lower operating costs, lower emissions per unit of production, and increased resilience to changes in the market (i.e., in the future, refineries will need to run more efficiently as the difference in profit margin between two similar refineries will become smaller).
Because the EPA assesses facilities on an annual basis, the designation is indicative of continued energy efficiency improvements, rather than merely achieving the first round of energy savings.
Why efficiency matters at the system level
Energy is a major portion of a refinery’s operating expenses. Consequently, even relatively minor increases in energy efficiency can have a substantial impact on a refinery’s profitability when implemented across an entire refinery.
Through improvements in how energy is consumed within the refinery, refineries can reduce downtime and increase flexibility in responding to changing demand for different products. As environmental regulations continue to tighten and operational requirements become more stringent, energy-efficient operation will become increasingly important.
Marathon Petroleum’s achievement of receiving multiple ENERGY STAR designations simultaneously indicates that the company’s energy management strategies are being implemented uniformly throughout its refining system, rather than individually at each of its locations. The systematic implementation of energy management strategies will contribute to improved performance across the entire refining network.
Implications beyond individual refinery sites
While the ENERGY STAR designation pertains to the individual refineries that receive the designation, there are implications of the designation that go beyond the individual facilities. Specifically, the designation indicates how corporate policies influence the operational decisions of refinery personnel and how the corporate operational culture influences the operational results of its refineries.
In addition, the designation emphasizes the importance of continuous improvement and disciplined operation in an industry characterized by large capital projects. Finally, the designation illustrates that the majority of the opportunities for progress in improving the energy efficiency of a refinery exist within the current assets of the refinery, rather than through the construction of new capital projects.
