Henkel Lauded for Vastly Improving Its Water and Energy Efficiency Rates

by | Apr 19, 2022

HenkelGermany-based Henkel is a chemical and consumer goods company best known for making such products as Dial, Persil, and Loctite. Its adhesive technologies are used in shoes, cars, and phones. The company wants to reduce its CO2 emissions from its 185 production sites by 75% by 2030 from a 2010 baseline. 

The global consulting firm McKinsey & Co. looked into the company and expounded on its efforts to better its efficiency rates. One way is to halve its energy use per ton of product at its production sites by 2030. This equates to improving its efficiency rates by 5% to 7% per year.

Digitalization is a key element of our agenda for purposeful growth. And Industry 4.0 is an important pillar of our digital transformation journey, enabling us to leverage sustainability along the entire value chain and helping us to accomplish our ambitious target to become a climate-positive company by 2040,” says Henkel CEO Carsten Knobel. Industry 4.0 refers to the “fourth industrial revolution.” 

What strategies is it using? 

It is deploying a digital backbone that uses the cloud to link up its entire operations. It launched in 2013 and has 3,500 sensors combined with cameras and robots that feed 1.5 billion data points each day. “With the help of artificial intelligence and advanced analytics, Henkel is using the data it collects to improve its product quality as well as its operational, financial, and environmental results,” says McKinsey. 

The platform tracks the efficiency data regarding energy and water usage at each plant. It also follows the data associated with fossil fuels, sewage, compressed air, and steam. The information gives Henkel complete insight into its operations. If a specific machine uses more energy or water than usual, the system alerts managers and can fix the problem.

“We have been driving digital transformation at Henkel Laundry & Home Care consistently for many years. In 2013, we developed a unique cloud-based data platform called Digital Backbone to digitize our supply chain,” says Dr. Dirk Holbach, Chief Supply Chain Officer at Henkel Laundry & Home Care. “Today, this platform connects more than 30 production sites and six distribution centers around the world in real-time.”

What are the results?

At the company’s “lighthouse” facility in Düsseldorf — a model plant — the overall equipment efficiency increased 30% from a 2010 baseline. That’s where its Persil laundry detergent is made. At the same time, Henkel’s energy consumption fell by 38%, and its water consumption dropped by 28%. Its waste levels declined by 20%. 

The digital backbone also improved plant safety by 60%. For example, electronic warning zones will automatically shut down forklifts when workers get too close. 

Meantime, the digital backbone increased the business unit’s efficiency as well. McKinsey says its overall equipment effectiveness is up 10% between 2010 and 2019. The units energy consumption fell by 25% too, leading to a decline in CO2 emissions of 800 metric tons. 

“All told, the business unit achieved energy savings roughly equivalent to the annual energy consumption of 300,000 people,” McKinsey says. Its energy cost fell by nearly $20 million as a result. 

Henkel says that it fully supports the goals of the Paris climate agreement. To that end, it is focused on energy efficiency and reducing CO2 emissions. Its goal is to improve efficiency rates by 75% by 2030. And it is also done through decarbonization and using more renewable energy.

“With our vision to become a climate-positive company by 2040, we want to replace the last remaining fossil fuels used in our production with climate-neutral alternatives such as biogas or gas obtained from converting CO2,” Henkel says. “We also aim to supply surplus carbon-free energy that Henkel does not need for its own purposes to third parties.” 

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