2020-05-22

Investing in the sun

Long before the global pandemic struck, KION Group had already begun reaping the benefits of switching to renewable energy as an alternative option at some sites and projects around the world. COVID-19 may have slowed the pace of bringing other initiatives forward on schedule, but the Group forges ahead with plans of implementing solar energy systems into some targeted facilities in Europe and investing in green energy solutions. Whether it’s the photovoltaic system on the rooftop of its newest production facility at KION, or the massive rooftop of solar panels installed in 2018 at the production facility in North America, the most recent data collected at both sites is a clear indication that ‘going solar’ has been a good investment.

1972. No, this is not the year that KION India was launched, but rather it is the number of solar panels that are in place on the roof of the new production facility, and which are helping the management team to realize a 65-percent reduction in energy costs annually.

“When we began planning the construction of our new site, we were really looking for energy independence because the supplies of electric energy are quite erratic in India and we realized that using solar energy was the only cost-effective solution to helping reach our goal,” explains Sunil Gupta, the president at KION India.

India currently finds itself in a massive energy transition and over the last four years, it has been remarkable to see how far the Indian renewable energy industry has advanced and that includes KION India joining the trend in late 2019, when it launched its new production site – Factory 2.0 – just outside the city of Pune in the state of Maharashtra.

A success on so many levels

“You can build new factories that are efficient in terms of the layout and productivity, but that is not necessarily impressive anymore. However, when you add in measures that make a facility sustainable, well, that makes customers, vendors and employees stand back and take notice because they see that we are taking this key issue seriously. It is important to everyone on so many levels,” admits Gupta.

“It is a ‘win-win’ for both the government and our business when we take advantage of the net metering system,” he notes, stating that the government placed a strong focus and orientation on increasing solar energy solutions over the last two years because they are simply not in a position to meet the industrial competitiveness from a cost perspective using traditional electricity modes.

The brand-new 700 kWp rooftop solar plant is synchronized with grid power, a diesel generator and an energy storage system and generates automatic reports in real time. At full efficiency, they have calculated a 65-percent reduction in annual energy costs. Add in a significant drop in the number of power cuts, the low maintenance of the photovoltaic system and the built-in safety parameters and you have a management team that was convinced this was the way forward.

“As a leader in our industry, we feel we have a responsibility to our customers, vendors, employees and the communities around us to build a plant that is not only cutting-edge in manufacturing standards, but also one that contributes to improving our environment. These assorted groups are impressed when they see a company of our size aggressively tackling the issue of sustainability in our country,” beams Gupta.

"What's really fantasctic is how little maintenance is required to manage our PV system!"

Sunil Gupta, President, KION India

Sealing the deal with customers

85%. This is what the management team at KION North America in Summerville, South Carolina says it has been able to offset from its utility bills since its solar panels were installed in 2018. “If I had to make the decision all over again, I would do it in a heartbeat,” admits Daniel Schlegel, the vice president of Operations at KION NA, with regard to the decision in 2017 to put a photovoltaic system in place. He said that with the support of federal and state subsidies back then, it made the overall cost for KION NA very attractive. He explained that their plant is a 1 MW (megawatt) system with a fixed rate sold to the energy provider over a 10-year period.

“It is not so common in US industry to see factories with solar panel roof systems and when we, the world’s largest producer of electric trucks, take customers up on the roof and they look out over the vast number of panels – all 3,643 of them – well, it can really impress them and convince them of our commitment and what our electric trucks could do for them,” explains Schlegel.

Adds Max Vome, the HSE&S manager in Summerville, in the first seven months after the system was installed, they were already generating energy equal to an impressive 88.3 percent of their own consumption.

“To put this in perspective, our 1MW photovoltaic system could power around 110 single-family homes annually.” Vome also stated that the panels are quite robust and the wind rating for them was not even close to being reached during 2019’s major hurricane, Dorian. It’s clear that going solar has been worth it for so many reasons: “Our energy bill has gone way down since 2018 and the maintenance is very minimal. I do not see how we could achieve this otherwise,” concludes Vome.

A 10-year strategy to making a reduction with renewable resources

30% by 2027. This is the target set by KION Group to reduce its energy-related CO2 emissions over a period of ten years and utilizing renewable energy solutions plays a big role in the targets laid out back in 2017. As Gordon Riske, Group CEO, stated in the company’s recently released Sustainability Report 2019. “The company is working on making energy consumption as efficient and sustainable as possible. We are systematically promoting the use and generation of renewable energy at all our sites. In 2019, we have ensured that, going forward, electricity for our sites in Germany, Italy and the Czech Republic will come from renewable sources.” He then adds, “Joining the KION site in Summerville, our new plant in India is now also equipped with a photovoltaic system. We are also testing the use of photovoltaics in our other new construction projects, notably at our plant in Poland, which is currently being built.”

10% today. After the first three years, the Group has already achieved one-third of its goal and according to Dr. Holger Hoppe, the senior director of sustainability management at the company, it is primarily due to executing the two important levers – energy efficiency and green electricity. “From existing projects, we have learned that investing in renewable energy makes sense from a financial standpoint and it is why we continue to identify additional areas where we can use solar power to greatest effect,” says Hoppe. A third lever, namely revisiting the composition of its service van fleet, will play an important role in reaching the remaining 20 percent.

"With our new contract to supply Germany and Czech Republic, we continue to buy our electricity as before, but now included in the package are additional ‘green’ sources of where that energy comes from and we estimate we can save the Group EUR 500,000 annually."

Simone Vosseler, Vice President, Procurement Indirect Materials & Services

The role of managing reduction priorities comes into play as a ‘next step’ to selecting the appropriate suppliers and renewable energy source. According to Simone Vosseler, a vice president for Procurement Indirect Materials & Services, as of January 2020, all Linde EMEA, STILL EMEA and KION Warehouse Systems production sites in Germany and the Czech Republic are now purchasing green electricity from two suppliers. “Our Italian production site in Luzzara has been purchasing green electricity from a local supplier, and soon – by 2021 – we will have a French partner supplying us in France. Ideally, we would like to have as few providers as possible based on the achievements so far, we are going to extend the purchasing of ‘green energy’ throughout the Group. “With our new contract to supply Germany and Czech Republic, we continue to buy our electricity as before but now included in the package are additional ‘green’ sources of where that energy comes from and we estimate we can save the Group EUR 500,000 annually.

Vosseler and her colleague, Christian Lüders, a commodity manager for Indirect Material & Sites, explained that several solar-driven projects are in various planning stages and much of the decision process is in the hands of the respective facility management teams. On the list for now is a solar power plant in Aschaffenburg, Germany where the energy generated would be used in a pilot plant for hydrogen production at the site. The hydrogen will then be used for the hydrogen-fueled trucks built there.

In addition, the possibility of equipping the new plant Kołbaskowo with its own photovoltaic system is currently being explored.

Summed up Hoppe: “When we research buying green energy, we place a lot of emphasis on having certain guarantees and certifications in place, such as the energy source to be used as well as getting the best price possible, of course, but that is only half of the story. As a leader in our industry, we have a responsibility where our plants are located to reduce our footprint, and we need to be open and have a dialogue with all who are impacted to ensure the best solutions possible going forward.”

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