Guidance for Plants Affected by Covid-19

The global pandemic caused by COVID-19 is affecting energy performance at many manufacturing sites.  Consequently, sites enrolled in the Challenge for Industry may face difficulties improving their energy performance during the 2020 and 2021 benchmarking period. Additionally, plants that achieved the Challenge in late 2019 or in 2020 may face delays or difficulties completing and submitting the application for Achiever recognition.

New sites interested in registering for the Challenge for Industry but experiencing non-normal production during 2020 and 2021 may be concerned about selecting a baseline period that is appropriate.

To address these issues, EPA is providing additional flexibility for current and prospective plants participating in the Challenge for Industry that have faced non-normal production and challenges due to COVID-19.

Non-normal production caused by COVID-19 includes, but is not limited to:

  • Periods of plant shutdowns.
  • Reduced operating and production schedules (1 shift vs. 3 shifts).
  • Reduced product volumes due to decreased demand, safety measures, etc.
  • Increased energy consumption due to higher ventilation rates, new HVAC set points, cleaning, etc.

If you have additional questions or circumstances not listed above, please contact Walt Tunnessen at tunnessen.walt@epa.gov.

The sections below provide additional guidance for current and prospective Challenge plants.

Currently Enrolled Plants

Plants currently registered for the Challenge for Industry (Challenge) whose five-year performance period ends during 2020 will be granted a 1-year extension if the plant’s energy performance was negatively affected by COVID-19. Additionally, plants with five-year performance periods ending in 2021 or 2022 will also be granted a 1-year extension if energy performance was negatively impacted by non-normal production due to COVID-19.

If your plant was affected, you are not required to request an extension.  Instead, extensions must be noted and reported in the application for recognition materials (e.g. SEI and PE Checklist) when the site applies for recognition for achieving the Challenge for Industry in the future.  Additionally, the PE reviewing the plant’s performance must confirm that the plant experienced non-normal operating and production as a result of COVID-19.

Plants that achieved the Challenge for Industry performance goal during the second half of 2019 or during 2020 but have not been able to complete the recognition application because of challenges created by COVID-19 will be allowed to submit applications beyond the usual 6-month deadline. 

Examples:

Situation:  Plant A is in the final year of its 5-year performance period and production was reduced by 40% during 2020 because of COVID-19.  Although the plant was on track to reduce energy intensity by 12%, after COVID-19 hit, the plant’s energy intensity increased significantly.

Remedy:  Plant A will be given an extension (6th year) so they can try again to reduce energy intensity and achieve the Challenge once production returns to normal.  

Situation:  Plant B registered for the Challenge with baseline period ending in July 2018. The plant’s 5-year Challenge performance period runs from August 2018 to July 2023.  During the 2020 period, the plant was shut down for several months.

Remedy:  Plant B still has two years to achieve the Challenge.  However, if the 2020 plant shut-downs resulted in longer-term impacts to energy performance or faced additional impacts during 2021, the plant would be granted an extension (6th year) if needed.

Situation: Plant C achieved the Challenge goal during its performance period ending in December 2019.  Due to COVID-19, the plant’s energy manager and the corporate engineer were re-assigned to other activities and could not complete the recognition application within 6 months of the plant achieving the Challenge.

Remedy:  EPA will accept Plant C’s recognition application even though it is after the usual 6-month deadline.  Plant C’s energy manager should note in the email sent to EPA with the SEI and PE check list that the application was delayed due to COVID-19.

Prospective Plants

Participating in the Challenge for Industry requires plants to select and register an energy performance baseline that is reflective of recent operations.  However, plants that have experienced non-normal production during the year 2020 or 2021 due to COVID-19 should select a recent 12-month baseline period that reflects normal production, such as during 2019.  Using a baseline period based on lower than normal production volumes or higher energy consumption levels will not provide an accurate reflection of the plant’s energy performance, which is necessary for participating in the Challenge for Industry.

To track progress towards achieving the Challenge for Industry, the plant should begin its 5-year performance period in the month following the end of the baseline period but in the year when production has returned to normal. For example, if the plant’s baseline period ends in December 2019, tracking would begin in January 2021, assuming production has returned to normal.

Plants that wish to use a regression-based energy model to track performance must also use a baseline period that reflects normal production. Plants are advised to exclude data from 2020 in the baseline period if non-normal production was experienced. Using multiple years of data from periods of normal production for the baseline is also encouraged.

Examples:

Situation:  Plant D would like to register for the Challenge for Industry but was shut down from April 2020 to June 2020.

Remedy:  The plant could use a either calendar year baseline period of January 2019 to December 2019 or a period covering April 2019 to March 2020. Either baseline period would be acceptable.  If the plant chose a baseline period ending in March 2020, the plant would begin tracking progress towards meeting the Challenge for Industry beginning in April 2021, if production has returned to normal.

Situation: Plant E has experienced non-normal production volumes due COVID-19 but would like to take the Challenge.  The plant’s parent company also has a fiscal year reporting cycle that spans October-September and would like to remain on that reporting cycle.

Remedy:  The plant can use a baseline period of October 2018 – September 2019 which is the most recent 12-month period of normal production within the company’s fiscal year reporting cycle.  The plant would begin tracking progress towards achieving the Challenge for Industry beginning in October 2021 if production has returned to normal.