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“Retrofit” – A Business Opportunity for Small and Medium Enterprises! ~ Recommending Retrofit ~Hirokazu Taniguchii

<Series 2 / complete>


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In the first part, we you talk about the “Warning for the danger posed by the use and throw culture of Japanese people”, and “Relationship between retrofit and sustainable technology”. In this part, please share your thoughts on the “Benefits and challenges of retrofit”, and “Product examples for retrofit”

Advantages of “Retrofit”

“Retrofit” enhances energy-saving performance by increasing the efficiency of only the important parts in a machine. I will talk about the advantages of “Retrofit” with the example of an air conditioner of Daikin Industries, Ltd. that won the Energy Conservation Award in 2016. Replacing only the compressor and control board with higher performance parts in an outdoor unit of Daikin air-conditioner (see the figure below) in the middle of its service life, the energy-saving performance of an air-conditioner improved by 15%. There is a significant reduction in the cost compared to replacing the entire outdoor unit with a new product. The work requires less than a day, and there is no need to worry about hindering the weekday work of a building, etc. by carrying out the retrofit on holidays. This method is environmentally friendly as the amount of waste is also reduced to 1/3. This method is not the same as just replacing components, and the unit is reborn as equipment with higher performance. The Energy Conservation Center focuses on popularizing “Retrofit” from the perspective of energy conservation.

Challenges for “Retrofit”

However, there are still some challenges to popularize “Retrofit”. There is a conflict of interest between manufacturers (equipment manufacturers) and users. Manufacturers want to sell new products so that their profit increases. If the “Retrofit” technology increases performance and service life, then the manufacturers will be naturally concerned that product sales will go down for a while. On the other hand, the big appeal for users is the advantage of high performance and extended service life at a low cost and short installation time. This conflict is the major challenge concerning the popularization of “Retrofit”. Establishment of a business model that is beneficial to manufacturers and users, even when “Retrofit” is used. That is, efforts are necessary so that users are convinced to continue using the products of manufacturers such that there is no decrease in sales, which is the concern of the manufacturers.
The ease of using retrofit varies depending on the size of the equipment and machines. For example, it would be difficult to use “Retrofit” in large-scale equipment and systems such as airplanes due to the connection and fitting between the different components. In the case of small household appliances, etc., purchasing a new product is cheaper than repair. Therefore, products suitable for a “Retrofit” are medium-sized equipment and machines.

“Retrofit” – A Business Opportunity for Small and Medium Enterprises!

As mentioned above, “Retrofit” is suitable for medium-sized equipment and products, and the business involves replacement or addition of components. From this perspective, this domain is an opportunity for not only the original manufacturers of equipment and machinery but also for other small and medium enterprises. In the field of machine tools, machine elements, and functional coating, etc. some small and medium enterprises have expanded their business opportunities by developing the “Retrofit business”.

The following table summarizes the products etc. in fields where the “Retrofit” business has already been deployed.

Accelerating the Spread of “Retrofit” Through “Visualization of Effectiveness”

At this center, we have been studying on how to visualize the energy conservation effect of retrofit. When enterprises make a capital investment, they consider the usefulness of retrofit from many perspectives, such as contribution to the business, investment recovery, energy conservation, ease of disposing of existing parts, and obstacles to business during the retrofit work. While examining the visualization of retrofit effect, we also tried to devise usefulness indicators focused on energy conservation experimentally and evaluated several retrofit cases. The figure below shows one such example. For example, in the case of machine tools, retrofit is much more useful from the viewpoint of energy conservation, than replacing the entire equipment, that is, replacing equipment from the perspective of energy saving is difficult. When comparing the usefulness of retrofit in machine tools and industrial furnaces, retrofit is found to be more useful in the industrial furnaces (heat-resistant coating of the outer wall), where the same amount of investment brings about a seven-fold reduction in the amount of carbon dioxide.

In this way, we believe that through “Visualization” of the usefulness of retrofit will enable enterprises to make accurate investment decisions. Like energy conservation, specific “Visualization” of the usefulness and effect of retrofit in the general manufacturing field will be an effective means of promoting business for enterprises engaged in retrofit and useful for making accurate investment decisions for the enterprises introducing retrofit. I consider that “Visualization” will further accelerate the spread of retrofit.

Finally, “Retrofit” is effective not only in the CO2 reduction efforts that are in progress at the Energy Conservation Center, but also an effective “Means of manufacturing” for the industrial world. I am convinced that retrofit will become increasingly popular in many more industrial fields in the future.

○“Retrofit” in this series
The concept of “Retrofit” includes “Overhaul”, “Repair/Service”, and “Minor changes” in a broad sense. However, in this series, “Retrofit” is defined and treated as given below.

To exceed the previous performance by replacement of components in machinery that have deteriorated due to aging or to add new functions by addition of parts.


Use and Throw Plastic Umbrellas - Are Japanese People Headed in the Correct Direction? ~ Recommending Retrofit ~

“Retrofit” – A Business Opportunity for Small and Medium Enterprises! ~ Recommending Retrofit ~

Hirokazu Taniguchi
Energy Conservation Center
Managing Director, Doctor of Engineering

Mr. Taniguchi majored in physical metallurgy at the University. By simulating the diffusion behavior of solute atoms in metals using a computer, he clarified the relationship with physical properties. (Graduated in 1981)
He worked with a steel manufacturer after graduation where his responsibility was the development of converters and continuous casting equipment used in the steelmaking process, new product development of high strength steel sheets for automobiles, and design of manufacturing equipment from materials. His next responsibility was research planning at the headquarters division and was a member of the international project for steel-based body weight reduction of vehicles where he studied body structures for the next generation vehicles.
After joining the Energy Conservation Center in 2010, he has been involved in policy planning support, guidance to businesses on energy conservation, and development of energy conservation tools, etc. to date.

<The Energy Conservation Center>
A group of experts who contribute to society through a wide range of activities such as diagnostics and advice to factories and buildings on energy conservation, issuing information on energy saving, and support for nurturing energy conservation human resources, etc
For details, please visit our Website

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