Benefits of Green Manufacturing

CPAs & Advisors

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One of the top manufacturing trends today is “Green Manufacturing.” Green manufacturing can be applied in two aspects. First, using renewable energy systems and clean-technology equipment. Second, reducing pollution and waste by minimizing the use of natural resources, recycling, reducing emissions, and reusing waste.

This initiative has become popular over the past few years, and continues to gain interest by consumers. Manufacturers in particular are usually portrayed negatively in the public’s eye in relation to environmental issues. The rolling smokestacks, environmental waste dumping, and inefficient depletion of natural resources are all stigmas typically associated with manufacturers. Even though these perceptions are not always true, it is something that has been associated with the “image” of manufacturing plants.

Green manufacturing has the benefit of not only setting your company aside from this negative perception, but also saving you “green” in the process. Going green can result in reduced costs and higher efficiency. Companies can better utilize the raw materials they have, cutting down on any excess waste, and even use that waste efficiently in other processes. Companies that can find renewable resources will not be dependent on supply and demand pricing of non-renewable resources. This can help keep costs more controlled, and not as susceptible to the swing in market prices.

Consider different ways to manage energy use in your facility:

  • Simply replacing lighting with energy-efficient products and controls can reduce energy consumption by up to 50 percent
  • Electric motors are responsible for almost 70 percent of all energy consumed in industrial applications. Energy efficient motors and drives can contribute a 30 percent energy savings with a seven-month return on investment.
  • Heating and cooling costs can be reduced by as much as 25 percent by operating the system efficiently.
  • Renewable sources of energy to power the facility can be a great long-term savings resource.

Tax credits for certain energy-saving property investments are available. There is a 30 percent credit for solar, fuel cells, and small wind asset purchases. A 10 percent tax credit is available for geothermal, micro turbines, and combined heat and power assets. To be eligible, you must own or have built the equipment, equipment must be placed into service the year you take the credit, and the equipment must meet specific performance and quality standards.

Green manufacturing not also has savings benefits, but a competitive advantage that can be used in marketing efforts. Becoming a green manufacturer can be a great reputation boost and create a positive perception about your company with consumers. Green companies can also become more competitive in government contracts; many contracts are available only to green businesses. Green purchasing companies may also only do business with green manufacturing companies. Going green can create numerous sales opportunities that would not be available otherwise.



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