Background Information

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1 Industry Sector Background Information Industry Automation Division Nuremberg, September 5, 2013 Automation solutions for the food and beverage industry With commercial revenue of over 15 billion US dollars worldwide estimated for 2014, the food and beverage industry is one of the world s highest revenue sectors of industry (Source: Frost & Sullivan). Trends such as increasing urbanization, demographic changes and the ongoing rise of the middle class in high-population countries such as China, India and Brazil are driving up demand for high-quality foods. At the same time, tastes and trends are becoming ever more discerning, requiring food and beverage manufacturers to produce not only higher volumes but also an increasing number of different products and variants. Companies operating in this industry are faced with five key questions: How can energy and water be more efficiently used? How can recipe modifications be implemented quickly and flexibly at the lowest possible cost? Where is there further scope for savings in maintenance and repairs? How can quality controls and quality assurance be successfully implemented worldwide across different locations? And finally: How can seamless product traceability be implemented in line with statutory regulations? Siemens provides support for food and beverage producers in their endeavors to extend, optimize and modernize their manufacturing capacity with a comprehensive portfolio of products. The industrial corporation provides integral solutions for energy distribution such as Totally Integrated Power (TIP), which opens up substantial scope for savings in industrial and special-purpose buildings. Its process control system Simatic PCS 7 and Simatic Batch help sustainably improve production flexibility and quality, and ensure automated reproducibility and accuracy, allowing suppliers the flexibility of production on demand in line with dynamic changes in consumer behavior. Solutions such as Simatic IT Unilab and Interspec guarantee reproducible production quality by defining recipes to the highest possible degree of accuracy and ensuring that these are adhered to across every process step with the utmost simplicity and reliability both within a single facility and across different Industry Sector Industry Automation Division Gleiwitzerstr Nuremberg Page 1/6

2 production sites. The Motion Control System Simotion offers scope for resetting filling and packaging machines in line with the demands of new products or formats, simply by pressing a button. Totally Integrated Automation (TIA) makes for optimum production efficiency. The concept allows the simplest and most comprehensive possible communication between automation components, ensuring a seamless flow of information from the field level up to the MES Manufacturing Execution System). Alongside the wide variety of offered solutions, its global presence and extensive services, Siemens also provides its customers with the benefit of many years of experience in the food and beverages industry. Siemens employees work in close cooperation with customers in subsegments such as beverages, dairy products, sugar, bakery, edible oils or tobacco, in some cases with a track record stretching back over decades. This level of in-depth expertise lays the foundation for bespoke solutions and systems for customers across the food and beverages industry. Cohesive solutions for effective automation A glance into the production plants operated by food and beverage manufacturers throws up a highly inconsistent picture. A large number of traditional production plants are badly in need of widespread modernization, not only to comply with statutory regulations but also to save energy or increase productivity. What are needed here are comprehensive and primarily also cohesive automation and drive solutions which offer smart networking and intuitive control. The aim is to make traditional manufacturing processes more efficient through the use of modern automation technology. Our customers should be able to concentrate their efforts on the art of producing food and beverages. This is why we attach such importance to providing cohesive systems designed for the simplest, quickest and most intuitive possible operation which provide tangible productivity and efficiency gains at the same time, explains Gunther Walden, Head of the Vertical Subsegment Food & Beverages at Siemens Industry. Siemens was quick to recognize the opportunities presented by integrated product and production life cycles, ringing in a whole new era of data integration on the automation level with its Totally Integrated Automation (TIA) concept as long ago as Since then, the industry supplier has continued to drive forward the monitoring and control of machines and processes from the field level to the production control center. Today, components from the sensor in the mixer or filling plant through the controls to the control center all speak a common language around the world. Posi- Page 2/6

3 tion sensors, contactors, frequency converters, electric drives, peripheral systems, machine controls or the human machine interface (HMI): All systems supplied by Siemens are coordinated to work together and have the capability to exchange information directly. All the necessary information and data flows seamlessly on the visualization level with the Simatic WinCC SCADA system and through the Simatic PCS 7 process control system to the enterprise management level totally without a media break, allowing users to analyze processes, arrive at a clear diagnosis and optimize processes. At the same time, integrated automation systems provide a solid basis for seamless product traceability and energy management. Automation technology continues to provide a powerful lever for more efficient, more flexible operational sequences. Production data evaluation helps companies to save energy, drive down costs and comply with the rules of industry regulators, concludes Gunther Walden. Targeted reduction of energy consumption and costs Energy has evolved as a substantial underlying cost factor in the food and beverage industry. In addition, the law demands more energy efficiency and the consumer is voicing demands for sustainable green production. With its B.Data energy management software, Siemens provides a powerful tool for the efficient use of energy. The software logs the status quo of all energy and material flows required in production, from water, electricity and heat through to pressure or steam. This allows individual loads in the production process to be assigned to individual users and energy consumption to be documented. Based on specific key performance indicators (KPIs), B.Data provides a substantiated basis for decisions relating to the necessity for energy optimization. Even the implementation of fundamental actions such as the detection of leaks, more even load distribution and the avoidance of load peaks can produce energy savings of between five and ten percent without the need for any additional investment. Changes such as introducing more energy-efficient motors can mean further energy savings of 40 percent. Combining electrical drives with the right frequency converters to reduce energy consumption can result in savings of 70 percent for fans, pumps or compressors. Siemens also supports beverage producers and breweries with a broad range of services designed to optimize the energy consumption of processes, machines and plants over the entire life cycle. Services include support for customers introducing an energy management system to ISO 50001, and assistance in the design and Page 3/6

4 implementation of energy data management systems and also energy analyses for machines, production lines or plants. To help finance efficiency measures, many projects customers are able to call on performance-based contracts which entail payment of the service provider through the energy cost savings achieved meaning that no up-front investment is required. Using data as a productivity lever Conversely, the industry is becoming increasingly more focused and globalized in nature. Large corporations operating across national boundaries and continents produce in highly automated factories, in which mechanical and electrical systems have reached a level which only allows minimal further optimization at relatively high expense. However, new potential for rationalization can still be exploited through the technical linkup of individual process steps. Siemens provides support to this type of customer by increasing the degree of integration between automation solutions and IT networks, with a view to collecting and preparing information on every production level and from different process steps. New IT solutions and software modules help to optimize the entire process rather than only individual production steps as was the case in the past. We are experiencing how production data is turning into another form of raw material which has to be used as effectively as possible, says Gunther Walden. The use of IT and software applications for industry has evolved into a key competitive factor. The flows of data are fed from a large number of different sources: Motors register their vibration behavior, providing information about their condition and future maintenance requirement. Process instruments deliver ever more precise and extensive data from an ever growing number of measuring points around the manufacturing process. Sensors pick up currents and energy consumption, code readers and RFID systems track the progress of raw materials and products across every process step, and continue to monitor them on their way to the supermarket shelf and the checkout. This wealth of data provides transparency in even the most complex of processes, and helps companies to control production and distribution in line with their targets with the utmost clarity and efficiency. Products to a consistent standard of quality Safe, high-quality foods are something we take for granted in this day and age. Consumers have also come to expect a consistent standard of quality and taste Page 4/6

5 no matter where and when a product is purchased. These two underlying expectations pose a considerable challenge for manufacturers. Branded goods which are globally available and which consumers expect to taste the same in every country are generally produced in parallel in many different factories at regional level. The challenge here is to guarantee a consistent quality of taste using local raw materials processed in regional production sites. One of the ways in which Siemens helps producers to meet this challenge is by offering a batch package for its Simatic PCS7 process control system which ensures precisely defined recipes, and a Manufacturing Execution System (MES) which allows, for instance, individual locations to exchange production data on a global basis. Reducing costs for filling and packaging Siemens is also highly sought after as a technology supplier in the field of filling plants and packaging areas which entail high costs for beverage and food manufacturers. Responsible for driving up costs in this field are primarily insular solutions which impede the seamless optimization of production processes or increase the work involved in programming and control. Siemens addresses this demand with its Optimized Packaging Line (OPL) concept: by using standardized components, data interfaces and open software systems and modules, the plant complexity of packaging lines can be minimized. The OPL concept coordinates hardware, software and communication and adjusts them ideally to the specific filling and packaging needs of the producer. The benefit for the customer: Substantially fewer hardware components such as controls, HMI, drives and network components are needed in comparison to heterogeneous systems. This in turn drives down investment and maintenance costs. Faster commissioning, shorter programming times and simpler line integration provide added cost benefits. Under the bottom line, OPL increases plant availability, transparency and efficiency in operation, and allows continuous optimization and faster adjustment of plants to meet changing requirements. OPL can also cut the costs associated with training, operation and maintenance. Ensuring food safety Alongside customer demands for transparency, food and beverage manufacturers are also subject to regulatory requirements. Due consideration has to be given to the stipulations set out by the Food & Drug Administration (FDA) in the USA, the Traceability Regulation EU 178/ 2002 in the European Union or the directives of the International Food Standard (IFS). Statutory regulations prescribe seamless and Page 5/6

6 traceable product identification. Cohesive IT-supported automation concepts are playing an ever more important role in the traceability of food and beverages. Using modern solutions, all the necessary data is precisely captured at each checkpoint and every individual quality control carried out along the entire value chain from the raw material through to the packaged product. This involves the use not only of Siemens process instrumentation and process control systems, but also RFID systems and optical code readers from the Simatic Ident portfolio. Contact for journalists: Siemens AG, Media Relations Peter Jefimiec, phone.: The Siemens Industry Sector (Erlangen, Germany) is the world's leading supplier of innovative and environmentally friendly products and solutions for industrial customers. With end-to-end automation technology and industrial software, solid vertical-market expertise, and technology-based services, the Sector enhances its customers' productivity, efficiency, and flexibility. With a global workforce of more than 100,000 employees, the Industry Sector comprises the Divisions Industry Automation, Drive Technologies and Customer Services as well as the Business Unit Metals Technologies. For more information, visit The Siemens Industry Automation Division (Nuremberg, Germany) supports the entire value chain of its industrial customers from product design to production and services with an unmatched combination of automation technology, industrial control technology, and industrial software. With its software solutions, the Division can shorten the time-to-market of new products by up to 50 percent. Industry Automation comprises five Business Units: Industrial Automation Systems, Control Components and Systems Engineering, Sensors and Communications, Siemens PLM Software, and Water Technologies. For more information, visit Page 6/6