Today's whiz-bang automated handling systems may be revolutionizing your DC operations, but they're also running up your power bill. Here are some ways to ease the pain.
Ben Ames has spent 20 years as a journalist since starting out as a daily newspaper reporter in Pennsylvania in 1995. From 1999 forward, he has focused on business and technology reporting for a number of trade journals, beginning when he joined Design News and Modern Materials Handling magazines. Ames is author of the trail guide "Hiking Massachusetts" and is a graduate of the Columbia School of Journalism.
Under pressure to meet the demands of omnichannel fulfillment and a rising tide of e-commerce orders, many warehouses have turned to automated material handling systems as a way to boost accuracy, cut labor costs, and speed up fulfillment. Equipment such as automated storage and retrieval systems (AS/RSs), conveying systems, lifts, and shuttles can go a long way toward helping DCs achieve those objectives.
The solution comes with a steep price, however. Automated facilities may see their electric bills climb to meet the increased energy demands of running these powerful machines.
In response, facilities are seeking out new ways to optimize energy consumption while keeping the pedal to the metal on fulfillment speed, according to Markus Schmidt, president of Swisslog Warehouse & Distribution Solutions, Americas. But what can they really do in this regard? We decided to ask the experts for some advice. What follows are their five top suggestions for ways to hold down your power costs.
1. Plug into the IoT. Intrigued by the notion of the Internet of Things (IoT) but haven't yet found a reason to take the plunge? This may be just the excuse you're looking for. The IoT, essentially a network of connected devices that communicate with one another automatically, can provide a big assist to DC managers looking to reduce their energy consumption. To begin with, it can supply vital data on a facility's energy usage patterns, which users can then analyze with an eye toward identifying savings opportunities. For example, by attaching power-usage sensors to individual pieces of material handling equipment, users can monitor energy consumption throughout their facility in real time, Schmidt said. Armed with this information, they can track changes in energy consumption for every room, aisle, drive, and motor in the building, identify inefficiencies, and make adjustments.
Another way to use the data is by analyzing it for purposes of integrated energy management control. In this approach, users set a baseline level of energy consumption for each machine, then manage their operation so multiple devices share their combined power "budget" in the most efficient way. For example, two sensors can communicate and delay the start of one machine by a few seconds in order to minimize the peaks in power draw that occur when two machines start up simultaneously, said Samuel Schaerer, controls development manager with the Swisslog Warehouse & Distribution Solutions Technology Center.
2. Recuperate and recharge. Energy "recuperation" is another strategy for cutting the amount of electricity required to run large material handling systems, according to Swisslog. Just as hybrid automobiles recharge their batteries by braking at stoplights, AS/RS cranes, miniload cranes, shuttle systems, and conveyor lifts can generate their own electricity. They do this by using their motor as a generator, creating electricity from friction when braking. The electricity they generate can then help power the unit itself or even be shared with others.
Energy recuperation offers considerable potential for savings. For example, AS/RS cranes can cut their energy draw as much as 20 percent by powering their horizontal motion using the electricity recuperated by their own downward vertical motion, according to Swisslog. Likewise, shuttle systems can cut their power consumption by 20 percent by timing the acceleration of one shuttle to occur at the same time that another shuttle hits the brakes.
3. Slow down and lose the weight. Automated conveyor systems consume the most electricity while they are running at high speed, so facilities can save serious money by automatically throttling down the systems during off-peak periods, a Swisslog analysis shows.
One way to capture those savings is by installing photo eyes that determine when a section of conveyor is idle, then send that signal through an IoT network to a central controller, the company said. Particularly effective in large-scale systems with thousands of feet of powered conveyors, these systems can save significant power by switching off certain conveyor zones—or even a specific motor on a single roller—when not in use.
Another way to cut the amount of electricity consumed by mobile material handling systems is to put the machines themselves on a diet. In recent years, some manufacturers have redesigned equipment like automated guided vehicles (AGVs) and AS/RS stacker cranes using lightweight materials, slashing 20 to 30 percent of the vehicles' weight without compromising their load-carrying capability, said Swisslog. Compared with their heavier brethren, these lightweight machines draw far less power from onboard batteries or the facility's grid.
4. Use smart software to save volts. Heating and lighting are the top two energy drains in warehouses. As a result, the path to power savings usually begins with a few basic steps like installing efficient LED lighting, adding skylights to capture natural daylight, installing loading dock seals and shelters, and adding building insulation.
Once they've completed those steps, managers can squeeze some additional savings out of their operations through the smart use of software. One way to do this is by automating the controls for various building functions, said Norm Saenz, managing director at the consulting firm St. Onge Co. For example, they might use a warehouse control system (WCS) to automatically turn off equipment when it's not in use.
In facilities that use electric vehicles, software such as lift-truck fleet management systems can play a big role in energy conservation efforts. Among other applications, managers can use these systems to collect data on battery charging patterns and power consumption, which they can then mine for energy-saving opportunities, Saenz said. For example, the data might show that switching to quick-charging equipment would help avoid the power peaks caused when all of the fleet's vehicles try to recharge at the same time.
5. Soak up the sun. Many industry professionals took notice when UPS Inc. announced plans to install $18 million worth of solar panels on facilities around the country—a move the company estimates will cut each building's power bill in half. Drawn by such promises, an increasing number of warehouse and distribution facilities are adding solar panels to their vast expanses of flat roof.
And it's not just facilities located in the South. Although it was once thought that solar panels only paid off in sunny desert locations, that's simply not the case, said Richard Murphy Jr., president and CEO of Murphy Warehouse Co., a family-owned logistics service provider based in Minneapolis. The technology actually works in any environment—from Arizona to Minnesota—because solar panels function most efficiently when they're cold, he said.
Along with helping trim a DC's electric bill, solar panels can generate extra savings when a facility hooks them up to industrial batteries that store backup power. Among other benefits, having a reserve power supply on hand might allow a company to avoid buying costly diesel generators for emergencies, Murphy said.
Alone or together, these five creative strategies are helping managers minimize their DCs' power consumption. The steps require some effort, to be sure, but the payoff can be huge. By giving them a try, managers can not only trim their electric bills, but also "green up" their operations. On top of that, they stand to achieve a quicker return on investment on the automated equipment that is fast becoming essential to meeting today's demands for lightning-fast distribution and fulfillment.
Congestion on U.S. highways is costing the trucking industry big, according to research from the American Transportation Research Institute (ATRI), released today.
The group found that traffic congestion on U.S. highways added $108.8 billion in costs to the trucking industry in 2022, a record high. The information comes from ATRI’s Cost of Congestion study, which is part of the organization’s ongoing highway performance measurement research.
Total hours of congestion fell slightly compared to 2021 due to softening freight market conditions, but the cost of operating a truck increased at a much higher rate, according to the research. As a result, the overall cost of congestion increased by 15% year-over-year—a level equivalent to more than 430,000 commercial truck drivers sitting idle for one work year and an average cost of $7,588 for every registered combination truck.
The analysis also identified metropolitan delays and related impacts, showing that the top 10 most-congested states each experienced added costs of more than $8 billion. That list was led by Texas, at $9.17 billion in added costs; California, at $8.77 billion; and Florida, $8.44 billion. Rounding out the top 10 list were New York, Georgia, New Jersey, Illinois, Pennsylvania, Louisiana, and Tennessee. Combined, the top 10 states account for more than half of the trucking industry’s congestion costs nationwide—52%, according to the research.
The metro areas with the highest congestion costs include New York City, $6.68 billion; Miami, $3.2 billion; and Chicago, $3.14 billion.
ATRI’s analysis also found that the trucking industry wasted more than 6.4 billion gallons of diesel fuel in 2022 due to congestion, resulting in additional fuel costs of $32.1 billion.
ATRI used a combination of data sources, including its truck GPS database and Operational Costs study benchmarks, to calculate the impacts of trucking delays on major U.S. roadways.
There’s a photo from 1971 that John Kent, professor of supply chain management at the University of Arkansas, likes to show. It’s of a shaggy-haired 18-year-old named Glenn Cowan grinning at three-time world table tennis champion Zhuang Zedong, while holding a silk tapestry Zhuang had just given him. Cowan was a member of the U.S. table tennis team who participated in the 1971 World Table Tennis Championships in Nagoya, Japan. Story has it that one morning, he overslept and missed his bus to the tournament and had to hitch a ride with the Chinese national team and met and connected with Zhuang.
Cowan and Zhuang’s interaction led to an invitation for the U.S. team to visit China. At the time, the two countries were just beginning to emerge from a 20-year period of decidedly frosty relations, strict travel bans, and trade restrictions. The highly publicized trip signaled a willingness on both sides to renew relations and launched the term “pingpong diplomacy.”
Kent, who is a senior fellow at the George H. W. Bush Foundation for U.S.-China Relations, believes the photograph is a good reminder that some 50-odd years ago, the economies of the United States and China were not as tightly interwoven as they are today. At the time, the Nixon administration was looking to form closer political and economic ties between the two countries in hopes of reducing chances of future conflict (and to weaken alliances among Communist countries).
The signals coming out of Washington and Beijing are now, of course, much different than they were in the early 1970s. Instead of advocating for better relations, political rhetoric focuses on the need for the U.S. to “decouple” from China. Both Republicans and Democrats have warned that the U.S. economy is too dependent on goods manufactured in China. They see this dependency as a threat to economic strength, American jobs, supply chain resiliency, and national security.
Supply chain professionals, however, know that extricating ourselves from our reliance on Chinese manufacturing is easier said than done. Many pundits push for a “China + 1” strategy, where companies diversify their manufacturing and sourcing options beyond China. But in reality, that “plus one” is often a Chinese company operating in a different country or a non-Chinese manufacturer that is still heavily dependent on material or subcomponents made in China.
This is the problem when supply chain decisions are made on a global scale without input from supply chain professionals. In an article in the Arkansas Democrat-Gazette, Kent argues that, “The discussions on supply chains mainly take place between government officials who typically bring many other competing issues and agendas to the table. Corporate entities—the individuals and companies directly impacted by supply chains—tend to be under-represented in the conversation.”
Kent is a proponent of what he calls “supply chain diplomacy,” where experts from academia and industry from the U.S. and China work collaboratively to create better, more efficient global supply chains. Take, for example, the “Peace Beans” project that Kent is involved with. This project, jointly formed by Zhejiang University and the Bush China Foundation, proposes balancing supply chains by exporting soybeans from Arkansas to tofu producers in China’s Yunnan province, and, in return, importing coffee beans grown in Yunnan to coffee roasters in Arkansas. Kent believes the operation could even use the same transportation equipment.
The benefits of working collaboratively—instead of continuing to build friction in the supply chain through tariffs and adversarial relationships—are numerous, according to Kent and his colleagues. They believe it would be much better if the two major world economies worked together on issues like global inflation, climate change, and artificial intelligence.
And such relations could play a significant role in strengthening world peace, particularly in light of ongoing tensions over Taiwan. Because, as Kent writes, “The 19th-century idea that ‘When goods don’t cross borders, soldiers will’ is as true today as ever. Perhaps more so.”
Hyster-Yale Materials Handling today announced its plans to fulfill the domestic manufacturing requirements of the Build America, Buy America (BABA) Act for certain portions of its lineup of forklift trucks and container handling equipment.
That means the Greenville, North Carolina-based company now plans to expand its existing American manufacturing with a targeted set of high-capacity models, including electric options, that align with the needs of infrastructure projects subject to BABA requirements. The company’s plans include determining the optimal production location in the United States, strategically expanding sourcing agreements to meet local material requirements, and further developing electric power options for high-capacity equipment.
As a part of the 2021 Infrastructure Investment and Jobs Act, the BABA Act aims to increase the use of American-made materials in federally funded infrastructure projects across the U.S., Hyster-Yale says. It was enacted as part of a broader effort to boost domestic manufacturing and economic growth, and mandates that federal dollars allocated to infrastructure – such as roads, bridges, ports and public transit systems – must prioritize materials produced in the USA, including critical items like steel, iron and various construction materials.
Hyster-Yale’s footprint in the U.S. is spread across 10 locations, including three manufacturing facilities.
“Our leadership is fully invested in meeting the needs of businesses that require BABA-compliant material handling solutions,” Tony Salgado, Hyster-Yale’s chief operating officer, said in a release. “We are working to partner with our key domestic suppliers, as well as identifying how best to leverage our own American manufacturing footprint to deliver a competitive solution for our customers and stakeholders. But beyond mere compliance, and in line with the many areas of our business where we are evolving to better support our customers, our commitment remains steadfast. We are dedicated to delivering industry-leading standards in design, durability and performance — qualities that have become synonymous with our brands worldwide and that our customers have come to rely on and expect.”
In a separate move, the U.S. Environmental Protection Agency (EPA) also gave its approval for the state to advance its Heavy-Duty Omnibus Rule, which is crafted to significantly reduce smog-forming nitrogen oxide (NOx) emissions from new heavy-duty, diesel-powered trucks.
Both rules are intended to deliver health benefits to California citizens affected by vehicle pollution, according to the environmental group Earthjustice. If the state gets federal approval for the final steps to become law, the rules mean that cars on the road in California will largely be zero-emissions a generation from now in the 2050s, accounting for the average vehicle lifespan of vehicles with internal combustion engine (ICE) power sold before that 2035 date.
“This might read like checking a bureaucratic box, but EPA’s approval is a critical step forward in protecting our lungs from pollution and our wallets from the expenses of combustion fuels,” Paul Cort, director of Earthjustice’s Right To Zero campaign, said in a release. “The gradual shift in car sales to zero-emissions models will cut smog and household costs while growing California’s clean energy workforce. Cutting truck pollution will help clear our skies of smog. EPA should now approve the remaining authorization requests from California to allow the state to clean its air and protect its residents.”
However, the truck drivers' industry group Owner-Operator Independent Drivers Association (OOIDA) pushed back against the federal decision allowing the Omnibus Low-NOx rule to advance. "The Omnibus Low-NOx waiver for California calls into question the policymaking process under the Biden administration's EPA. Purposefully injecting uncertainty into a $588 billion American industry is bad for our economy and makes no meaningful progress towards purported environmental goals," (OOIDA) President Todd Spencer said in a release. "EPA's credibility outside of radical environmental circles would have been better served by working with regulated industries rather than ramming through last-minute special interest favors. We look forward to working with the Trump administration's EPA in good faith towards achievable environmental outcomes.”
Editor's note:This article was revised on December 18 to add reaction from OOIDA.
A Canadian startup that provides AI-powered logistics solutions has gained $5.5 million in seed funding to support its concept of creating a digital platform for global trade, according to Toronto-based Starboard.
The round was led by Eclipse, with participation from previous backers Garuda Ventures and Everywhere Ventures. The firm says it will use its new backing to expand its engineering team in Toronto and accelerate its AI-driven product development to simplify supply chain complexities.
According to Starboard, the logistics industry is under immense pressure to adapt to the growing complexity of global trade, which has hit recent hurdles such as the strike at U.S. east and gulf coast ports. That situation calls for innovative solutions to streamline operations and reduce costs for operators.
As a potential solution, Starboard offers its flagship product, which it defines as an AI-based transportation management system (TMS) and rate management system that helps mid-sized freight forwarders operate more efficiently and win more business. More broadly, Starboard says it is building the virtual infrastructure for global trade, allowing freight companies to leverage AI and machine learning to optimize operations such as processing shipments in real time, reconciling invoices, and following up on payments.
"This investment is a pivotal step in our mission to unlock the power of AI for our customers," said Sumeet Trehan, Co-Founder and CEO of Starboard. "Global trade has long been plagued by inefficiencies that drive up costs and reduce competitiveness. Our platform is designed to empower SMB freight forwarders—the backbone of more than $20 trillion in global trade and $1 trillion in logistics spend—with the tools they need to thrive in this complex ecosystem."