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Tools for Evaluating Energy Efficiency of Steel Production: Lessons from Sweden and Europe
KTH, School of Industrial Engineering and Management (ITM), Energy Technology, Energy and Climate Studies, ECS.ORCID iD: 0000-0002-3618-1259
2014 (English)Licentiate thesis, comprehensive summary (Other academic)
Abstract [en]

The European Union faces challenges related to climate change, security of energy supply, and competitiveness of European industries. Energy efficiency indicators are required for monitoring and controlling the effectiveness of policies such as the recently endorsed Energy Efficiency Directive. This thesis aims at assessing whether traditionally used energy efficiency indicators capture the development of energy efficiency in the iron and steel sector. The study is based on results from two statistical methods: a top-down, i.e. Malmquist productivity index, and a bottom-up, i.e. partial least squares regression.

The specific energy consumption (the indicator representing the sector within the Odyssee energy efficiency index) was scrutinised together with associated indicators based on economic production using the aforementioned statistical methods. The results demonstrated the specific energy consumption does not capture the characteristics of the value chain of steel products. Therefore, it is not sufficient for capturing the energy efficiency of iron and steel industries. Previous studies suggest using indicators based on economic production (e.g. value added) since they represent the value chain to larger degree. However, the value creation process of companies belonging to larger international groups cannot be estimated reliably. Furthermore, the trends of both types of indicators tend to be highly influenced by structural changes, veiling the actual efficiency development.

Energy use statistics published by international organisations were also compared for the Swedish case. The results demonstrated that international organisations use different methodologies for allocating energy use statistics between consumption and transformation sectors. The method has significant implications on the trends observed, if based on openly available statistics.

This thesis complements previous research by reviewing implications of traditional energy efficiency indicators based on company data, national statistics or openly available statistics and contributes with insights essential for future efforts towards improving energy efficiency indicators for the steel industry.

Abstract [sv]

Den europeiska unionen står inför utmaningar relaterade till minskad klimatpåverkan, säkerställd energitillgång samt konkurrenskraften hos europeisk industri. Energieffektiviseringsindikatorer krävs för att övervaka och kontrollera effektiviteten hos energipolicy såsom det nyligen antagna energieffektiviseringsdirektivet. Den här avhandlingen syftar till att bedöma om traditionellt använda energieffektiviserings-indikatorer fångar järn- och stålsektorns utveckling inom energi-effektivitet. Studien är baserad på resultat från två statistiska metoder: en top-down-metod, Malmquists produktivitetsindex, och en bottom-up-metod, partiella minsta kvadratmetoden.

Den specifika energikonsumtionen – indikatorn som representerar sektorn i Odyssees energieffektiviseringsindex – granskades tillsammans med andra energieffektivitetsindikatorer med hjälp av de ovan nämnda statistiska metoderna. Resultaten visade att specifik energikonsumtion inte fångar karaktären av stålprodukternas värdekedjor. Indikatorn är därför inte tillräcklig för att fånga energieffektivitet inom järn- och stål-industrier. Tidigare studier föreslår att använda indikatorer baserade på ekonomisk produktion (exempelvis förädlingsvärdet) då de representerar värdekedjan till högre grad. Förädlingsvärdet kan dock inte uppskattas tillförlitligt för företag som tillhör större internationella grupper. Trend-erna hos båda typerna av indikatorer tenderar dessutom att påverkas av strukturella förändringar, vilka döljer den riktiga effektivitetsutvecklingen.

En jämförelse gjordes även av energianvändningsstatistik publicerad av olika internationella organisationer för det svenska fallet. Resultaten demonstrerade att internationella organisationer använder olika metoder för att allokera energianvändning mellan konsumtions- och omvandlings-sektorer i statistiken. Metoden påverkar observerade trender signifikant om de baseras på öppet tillgänglig statistik.

Avhandlingen kompletterar tidigare forskning genom att belysa innebörden av traditionella energieffektiviseringsindikatorer baserade på företagsdata, nationell statistik eller öppet tillgänglig statistik samt bidrar med insikter som kommer att vara väsentliga för framtida satsningar i att förbättra energieffektiviseringsindikatorer för stålindustrin. 

Place, publisher, year, edition, pages
Stockholm: KTH Royal Institute of Technology, 2014. , 50 p.
Series
TRITA-ECS, 14/03
Keyword [en]
energy efficiency, indicators, iron and steel sector, systems analysis
Keyword [sv]
energieffektivitet, indikatorer, järn- och stålsektorn, systemanalys
National Category
Energy Systems
Research subject
Energy Technology
Identifiers
URN: urn:nbn:se:kth:diva-149348ISBN: 978-91-7595-230-7 (print)OAI: oai:DiVA.org:kth-149348DiVA: diva2:739556
Presentation
2014-09-19, Learning Theatre (M235), Brinellvägen 68, Stockholm, 10:00 (English)
Opponent
Supervisors
Available from: 2014-08-28 Created: 2014-08-20 Last updated: 2014-08-28Bibliographically approved
List of papers
1. Methodological differences behind energy statistics for steel production – implications when monitoring energy efficiency
Open this publication in new window or tab >>Methodological differences behind energy statistics for steel production – implications when monitoring energy efficiency
2014 (English)In: Energy, ISSN 0360-5442, E-ISSN 1873-6785, Vol. 77, no SI, 391-396 p.Article in journal (Refereed) Published
Abstract [en]

Energy efficiency indicators used for evaluating industrial activities at the national level are often based on statistics reported in international databases. In the case of the Swedish iron and steel sector, energy consumption statistics published by Odyssee, Eurostat, the IEA (International Energy Agency), and the United Nations differ, resulting in diverging energy efficiency indicators. For certain years, the specific energy consumption for steel is twice as high if based on Odyssee statistics instead of statistics from the IEA. The analysis revealed that the assumptions behind the allocation of coal and coke used in blast furnaces as energy consumption or energy transformation are the major cause for these differences. Furthermore, the differences are also related to errors in the statistical data resulting from two different surveys that support the data. The allocation of coal and coke has implications when promoting resource as well as energy efficiency at the systems level. Eurostat's definition of energy consumption is more robust compared to the definitions proposed by other organisations. Nevertheless, additional data and improved energy efficiency indicators are needed to fully monitor the iron and steel sector's energy system and promote improvements towards a greener economy at large.

Keyword
energy and resource efficiency, iron and steel sector, energy use statistics
National Category
Energy Systems
Identifiers
urn:nbn:se:kth:diva-148578 (URN)10.1016/j.energy.2014.09.020 (DOI)000346542500044 ()2-s2.0-84909987499 (Scopus ID)
Funder
Swedish Energy Agency, 36365-1
Note

QC 20150213. Updated from accepted to published.

Available from: 2014-08-08 Created: 2014-08-08 Last updated: 2017-12-05Bibliographically approved
2. Capturing energy efficiency in European iron and steel production: comparing specific energy consumption and Malmquist productivity index
Open this publication in new window or tab >>Capturing energy efficiency in European iron and steel production: comparing specific energy consumption and Malmquist productivity index
2014 (English)In: Energy Efficiency, ISSN 1570-646X, E-ISSN 1570-6478, Vol. 7, no 6, 955-972 p.Article in journal (Refereed) Published
Abstract [en]

European iron and steel producers are working towards increased energy efficiency to meet requirements set by European policies such as the Energy Efficiency Directive. In this study, we show that the Specific Energy Consumption (SEC), representing the iron and steel sector in the Odyssee Energy Efficiency Index (ODEX) - the tool for policy evaluation recommended by the European Commission, is insufficient for capturing energy efficiency trends of European iron and steel production. European producers focus on niche markets, diversifying and specialising their set of products well beyond crude steel, which is the benchmark product for deriving the SEC. We compare the SEC with the more comprehensive Malmquist Productivity Index (MPI) methodology, which is calculated using Data Envelopment Analysis (DEA) techniques. An evaluation of energy efficiency trends during 2000 – 2010 showed that the SEC overestimated energy efficiency improvements for European steel industries, while underestimating the improvements achieved by Swedish steel industries. A comparison between the SEC, the MPI/DEA approach and energy intensity based on value added in the Swedish case provides further insight to the methodological differences between the approaches. We conclude that the approaches highlight different aspects of energy efficiency analyses, and that the SEC is not sufficient for capturing energy efficiency of steel industries.

Keyword
policy evaluation, energy efficiency, specific energy consumption, SEC, iron and steel production, Malmquist Productivity Index, Data Envelopment Analysis
National Category
Energy Systems
Identifiers
urn:nbn:se:kth:diva-144051 (URN)10.1007/s12053-014-9264-8 (DOI)000344533500003 ()2-s2.0-84920709109 (Scopus ID)
Funder
Swedish Energy Agency
Note

QC 20141204

Available from: 2014-04-07 Created: 2014-04-07 Last updated: 2017-04-28Bibliographically approved
3. Economic and operational factors in energy and climate indicators for the steel industry
Open this publication in new window or tab >>Economic and operational factors in energy and climate indicators for the steel industry
Show others...
2015 (English)In: Energy Efficiency, ISSN 1570-646X, E-ISSN 1570-6478, Vol. 8, no 3Article in journal (Refereed) Published
Abstract [en]

European steel producers need to increase energy efficiency and reduce CO2 emissions to meet requirements set by European policies. Robust indicators are needed to follow up these efforts. This bottom-up analysis of traditional energy and climate indicators is based on plant level data from three Swedish steel producers with different product portfolios and production processes. It concludes that indicators based on both physical and economic production are interlinked with aspects both within and outside the company gates. Results estimated with Partial Least Squares Regression (PLSR) confirm that steel production has complex relationships with markets, societal context and operational character of the industry. The study concludes that: (i) physical indicators (based on crude steel production) may be useful at the process level, but not at the industry-wide level, (ii) the value added is not a reliable alternative since it cannot be properly estimated for companies belonging to larger international groups, and (iii) structural shifts may influence the results significantly, and veil improvements made at the process level. Finally, harmonized system boundary definitions are vital for making indicators comparable between companies. The use of traditional indicators, as defined today, may lead to uninformed decisions at the company as well as policy levels.

Keyword
specific energy consumption, CO2 emissions, physical and economic indicators, industrial evaluation, iron and steel industry
National Category
Energy Systems
Identifiers
urn:nbn:se:kth:diva-148579 (URN)10.1007/s12053-014-9296-0 (DOI)000353824300004 ()2-s2.0-84907653015 (Scopus ID)
Note

Updated from from submitted to published.

QC 20150521

Available from: 2014-08-08 Created: 2014-08-08 Last updated: 2017-12-05Bibliographically approved

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