Mehul Shah Research Analyst Matthew Littlefield Sr. Research Analyst

1. Energy Management: Driving Value in the Industrial Environments Mehul Shah Research Analyst Matthew Littlefield Sr. Research Analyst

2. Why Now? • In the US, the industrial sector accounts for about one third of total energy consumption, which is more than any other sector, including: residential, commercial, and transportation¹ • Globally, the industrial base now accounts for nearly half of all energy consumed². • In the top 10 most energy intensive industries, the cost of energy can ranges from 3.3% to 56% of the total dollar value add of production³. ¹ "Annual Energy Outlook 2009", Department of Energy, Energy Information Administration, March 2009 ² "International Energy Outlook", Department of Energy, Energy Information Administration, May 2009 ³ "Energy Trends in Selected Manufacturing Sectors", Environmental Protection Agency, May 2007

3. Agenda • Research Frameworks • Survey Demographics • Making the Best-in-Class • P.A.C.E. (Pressures, Actions, Capabilities, Enablers) • Recommended Actions

4. Aberdeen’s Competitive Framework • In the research study, Aberdeen asked how companies performed with respect to Overall Equipment Effectiveness, Energy Efficiency and Operating Margin. Each respondent is subsequently categorized into: • Best-in-Class – Top 20% performers • Industry Average – Middle 50% performers • Laggards – Bottom 30% performers

5. Aberdeen’s PACE Framework Pressures – What market pressures are driving executives to focus on energy management? Actions – What strategic actions are they taking in response to those pressures? Capabilities – What process, organizational, knowledge management and performance management differences enable greater business performance? Enablers – What technologies support the capabilities?

6. Agenda • Research Goals • Survey Demographics • Making the Best-in-Class • P.A.C.E. (Pressures, Actions, Capabilities, Enablers) • Recommended Actions

7. Study Demographics Geographies Industries Food/Beverage 7% Automotive 12% North America 6% Pulp & Paper Europe 9% 18% Industrial Equipment Asia-Pacific Chemicals Other 14% 9% Industrial Products 15% 67% Metals 9% Utilities 10% 10% Between February and March 2009, Aberdeen examined the use, the experiences, and the intentions of more than 232 enterprises on energy management

8. Mode of Manufacturing Source: Aberdeen Group, April 2009

9. Agenda • Research Goals • Survey Demographics • Making the Best-in-Class • P.A.C.E. (Pressures, Actions, Capabilities, Enablers) • Recommended Actions

10. Best-in-Class Defined

11. Maturity with an Energy Management Program 50% 40% 22% 25% 20% 10% 8% 0% More than 3 years 1 to 3 Years Less than 1 year Currently in No Plans Planning Stages Overall Source: Aberdeen Group, April 2009

12. Agenda • Research Goals • Survey Demographics • Making the Best-in-Class • P.A.C.E. • Pressures • Recommended Actions

13. Need to reduce costs in 80% manufacturing operation Maintain or achieve a competitive 46% advantage Want to be a thought leader in 20% sustainability Elevated economic and consumer Overall 17% uncertainty 0% 50% 100%

14. Agenda • Research Goals • Survey Demographics • Making the Best-in-Class • P.A.C.E. • Strategic Actions • Recommended Actions

15. Strategic Actions 69% Redesigning / optimizing processes to be energy efficient 67% 51% Create / Improve visibility into energy across the enterprise 62% Include energy management in enterprise- 41% wide Corporate Social Responsibility 32% Initiatives BIC Overall 15% Create or improve collaboration across functional groups 17% 0% 40% 80% Source: Aberdeen Group, April 2009

16. Establishing a Energy Management Culture 70% 59% 58% 40% 37% 35% 24% 23% 0% Energy Management is one of the top three Energy Management is one of the central part of focus areas of company's strategic agenda the organizations culture Source: Aberdeen Group, April 2009 BIC Industry Average Laggards Cross-functional team across multiple plants to ensure best practices are shared and implemented. We track energy usage by asset. Our focus is to create a culture of energy and sustainability ~ Maintenance Manager, Food & Beverage

17. Agenda • Research Goals • Survey Demographics • Making the Best-in-Class • P.A.C.E. • Capabilities: Process • Recommended Actions

18. 100% 82% 58% 57% 49% 49% 50% 39% 39% 38% 31% 30% 26% 19% 0% Standardized Standardized Established formal Established short term processes to monitor processes to monitor energy management and long term goals energy across the emissions across the programs endorsed for individual plants / enterprise enterprise by senior management facilities Best-in-Class Industry Average Laggards Process Capability Source: Aberdeen Group, April 2009 Each production area is tracked for Power Usage and we have monthly targets identified and mangers report what activities contributed to over target condition, and identify countermeasures to correct ~ Maintenance Manager, Automotive

19. Agenda • Hypothesis • Survey Demographics • Making the Best-in-Class • P.A.C.E. • Capabilities: Organization • Recommended Actions

20. Organizational Structure Source: Aberdeen Group, April 2009 We have created an energy conservation work group that teleconferences monthly to identify savings opportunities, review energy usage and determine a path forward in energy usage reduction ~ Mid Size Chemical Company

21. Agenda • Hypothesis • Survey Demographics • Making the Best-in-Class • P.A.C.E. • Capabilities: Performance and Knowledge Management • Recommended Actions

22. Knowledge Management Source: Aberdeen Group, April 2009 We've trained employees on our goals and solicited their input on potential projects. We've also formed special committees to perform some of the initiatives, and posted our goals on plant bulletin board ~ Director of Manufacturing

23. Performance Management Source: Aberdeen Group, April 2009

24. Agenda • Research Goals • Survey Demographics • Making the Best-in-Class • P.A.C.E. • Capabilities: Enablers • Recommended Actions

25. 100% 69% 62% 60% 56% 56% 50% 50% 40% 39% 33% 33% 31% 29% 27% 24% 22% 0% Energy Efficient Employee Training Updated Energy Technology to Consultants Hardware & Certification Delivery Systems automate collection and monitoring of energy data Best-in-Class Industry Average Laggards Enablers for Energy Management Source: Aberdeen Group, April 2009

26. Technology Tools 50% 46% 46% 44% 42% 42% 37% 34% 33% 30% 30% 26% 26% 24% 25% 22% 21% 21% 21% 20% 18% 18% 15% 11% 9% 5% 0% Energy Alert / Event Dashboards Predictive Analytics SPC (Statistical Environment Workflows Management Management Maintenance Process Control) Management Best-in-Class Industry Average Laggards Source: Aberdeen Group, April 2009

27. Interoperability with Energy Management Tools 50% 45% 41% 35% 30% 26% 25% 17% 17% 9% 9% 0% Asset Management Dashboards & Advanced Process Analytics Control BIC Industry Average Laggards Source: Aberdeen Group, April 2009

28. Agenda • Research Goals • Survey Demographics • Making the Best-in-Class • P.A.C.E. • Recommended Actions

29. Recommended Actions • Include energy management in corporate wide sustainability initiative • Establish executive level sponsorship for energy management programs with roles and responsibilities defined at an departmental level to drive the success of such programs • Include energy data (consumption, costs etc) as part of the optimization process to schedule maintenance and production activities • Provide real-time as well as historical energy data to appropriate employees as actionable intelligence • Invest in automating energy management to gain visibility into energy data and integrate it with existing technology investments

30. Contact Aberdeen Mehul Shah Phone: 617.854.5212 Mehul.Shah@Aberdeen.com Matthew Littlefield Phone: 617.854.5204 Matthew.Littlefield@Aberdeen.com