Reducing costs through enhanced reliability
Virve Viitanen, Head of Customer Care and Support, ABB Motion Services, explores strategies for businesses in the energy sector to improve the reliability of their equipment. Implementing effective measures can reduce operational costs and manage the risks linked to unexpected equipment failures and downtime.
Unplanned downtime regularly results in high costs for industrial businesses. That’s according to an ABB survey of 3,215 plant maintenance leaders across various sectors, including energy, metals, utilities, food and beverage, and chemicals. In the energy and power generation sector alone, an hour of unexpected downtime can cost nearly USD180,000 and 69 percent of industrial businesses experiencing these shutdowns at least monthly.
Reliable equipment delivers clear advantages in reducing unplanned downtime, maximizing operational uptime, improving performance, and ensuring continuous equipment availability. However, despite the well-recognised benefits of reliability, current maintenance practices often fall short.
The benefits of predictive maintenance: maximizing uptime and efficiency
Downtime’s potentially damaging effects range from lost production and wasted materials to reputational harm and a loss of competitiveness. Despite these well-known risks, many businesses still rely on reactive “run-to-fail” maintenance strategies, where equipment is allowed to run to failure before it is fixed, or time-based/preventive maintenance strategies, where businesses perform maintenance to equipment routinely after a set time.
Our research indicates that 21 percent of businesses surveyed use reactive maintenance strategies, with 80 percent of them experiencing unplanned downtime monthly, higher than the average 69 percent.
In contrast, those using condition-based or predictive maintenance reported the greatest uptime improvements over the past year. Predictive maintenance uses continuous data about asset performance to identify potential risks and issues before any equipment fails. Digitalization enables operators to maintain assets through assessment and optimization by gathering, monitoring and analysing data to track performance outcomes.
Using insights from these digital solutions allows informed decisions on the most effective reliability strategies. With their ability to align maintenance with business priorities, outcome-based agreements represent a compelling next step for industrial businesses.
For instance, a Belgian sugar-processing plant who boosted process uptime and energy efficiency by 12 percent using digital-monitoring solutions. Facing critical downtime, data revealed high vibration on a fan due to built-up sugar particles. A simple clean and filter replacement helped the plant make savings of €4,000 per year per fan. The monitoring system optimized maintenance cycles too, identifying an optimal annual cleaning cycle.
The next step in reliability
Encouragingly, 66 percent of decision-makers plan to increase reliability and maintenance investments in the next three years, recognising its importance. However, further education on the full benefits of reliability – including maximizing uptime, reducing costs, and ensuring peace of mind – remains crucial.
Businesses could consider introducing an outcome-based strategy, where service partners are paid for achieving set outcomes, such as increased uptime or energy savings. As many as 87 percent of decision makers surveyed expressed interest in agreements like these, signalling growing demand for methods that prioritize reliability over simply being reactive to failures.
One of the most effective ways to achieve reliability is through long-term, outcome-based maintenance agreements with service providers. The energy and power sector showed the most interest in these outcome-based models, with 91 percent responding positively showing the potential improvements and saving could be significant. These agreements provide access to expertise to help businesses achieve desired outcomes like increased uptime.
Recognising the importance of reliability, renewable generator, Statkraft, entered a 10-year outcome-based services contract with ABB for its Lister Drive project in Liverpool, UK. This involved installing a 40-ton flywheel to stabilize the local grid. ABB’s comprehensive maintenance strategy, including planned and rapid response services, helps ensure high uptime levels. Digitalized equipment also enable remote monitoring and proactive corrective actions.
Outcome-based agreements such as the one between Statkraft and ABB are gaining popularity because they increase uptime, energy savings, and most valuably are giving companies the opportunity to free up personnel to focus on their business goals and objectives. They also allow plant maintenance leaders to retain control while designing customised strategies with the service partners to meet specific targets.
These models rely on digitally connecting equipment for accurate condition monitoring to fix issues before downtime occurs.
Recommendations for businesses
To improve reliability and reduce the high costs and frequency of downtime, industrial businesses should implement these key actions:
- Analyze the effects of downtime. Understand the direct and indirect costs, identify critical equipment, and consider the broader business implications. This provides a solid baseline.
- Prioritize reliability when investing in new equipment, and invest in reliability-centred services, like modernization or reconditioning. Reconditioning variable speed drives, for instance, restores factory quality while avoiding up to 80 percent of emissions from new purchases.
- Digitalize motor-driven equipment and applications. This allows businesses to remotely monitor the health and performance of an asset, shifting to lower-risk, condition-based maintenance based on continuous equipment data.
- Consider long-term, outcome-based service agreements. Most businesses plan to increase maintenance investments. Outcome-based models, paid based on achieved uptime and efficiency targets, offer cost-efficiency, sustainability, competitiveness and peace of mind, allowing more focus on core operations.
By auditing impacts, prioritising reliability, digitalizing, and exploring outcome-based services, businesses can proactively reduce downtime risks and optimize maintenance strategies.
The value of reliability
Investing in reliability provides a critical business advantage by decreasing the risk of costly unplanned downtime. Prioritizing reliability through digital technologies and outcome-based services means businesses can optimize performance, control costs, and drive sustainable operations.
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