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This lecture focuses on understanding the energy flows in a production process, from raw materials to final products, by developing process recipes and block flow diagrams. It covers the allocation of energy usage, identifying key energy drivers, using Pareto analysis to prioritize energy-saving efforts, and ensuring energy and mass conservation through energy and mass balances. The lecture also delves into the importance of understanding unit operations, energy conversion efficiency, and the role of energy in transforming materials into products. It emphasizes the significance of energy and mass balance equations, the use of constitutive equations for energy flow characterization, and the application of thermodynamic principles to calculate energy costs and optimize system efficiency.