Price volatility, environmentalism, and emerging technologies eclipsing deregulation as primary industry driver
Waxman-Markey, cap and trade, smart-grid infrastructure, real-time pricing, demand response, on-site energy storage — never has there been a more fascinating — or challenging — time to pursue the field of energy or facility management, as we are experiencing the convergence of three long-gestating trends that will forever change the way we purchase, manage, and consume energy. Energy-price volatility peaked during the summer of 2008, and as expected, consumption behavior started to change. Environmental awareness (i.e., global warming) hit its tipping point around 2006/2007, evolving from a social to a legislative issue that no longer could be ignored or deferred. Lastly, energy efficiency emerged as one of the most dynamic segments of the energy industry, driven primarily by the goal of keeping rising energy costs in check.
Early signs of this convergence during the early 2000s led to highly progressive regulatory and legislative initiatives in California, which introduced a multitude of programs to manage per-capita energy consumption. According to Gov. Arnold Schwarzenegger, Californians use 40-percent less energy than the average American, while California's first-in-the-nation statewide green-building codes are further reducing the state's carbon footprint.
Not to be outdone, New York City Mayor Michael Bloomberg announced in April a major legislative package focused on creating a green-buildings plan for the City of New York. This initiative is the world's most comprehensive package of legislation to reduce greenhouse-gas emissions from existing government, commercial, and residential buildings. Once implemented, it will reduce energy costs by some $750 million a year while reducing citywide emissions by 5 percent, the equivalent of eliminating all carbon emissions from Oakland, Calif.
Clearly, a new era of energy efficiency is upon us. How, then, can we best prepare for the coming changes? One thing is certain: We do not have to look far for examples. This article discusses how energy-efficient technologies are being applied successfully in commercial and industrial facilities across the United States, reducing per-capita energy consumption.
DELIVERING ECONOMIC VALUE THROUGH ENERGY-EFFICIENT TECHNOLOGIES
Options for improving whole-building energy performance include, but certainly are not limited to, those in the following projects. In each case, energy consumption and, subsequently, carbon footprint and energy costs were reduced. Each project has been justified through life-cycle-cost analysis, and most have highly attractive paybacks.
Facility energy audit
With heating and cooling a significant budgetary expense, Waunankee Community School District in Waunankee, Wis., was looking to lower energy costs and improve long-term HVAC-system reliability.
A national HVAC company performed a thorough audit of the district's facilities to gain a baseline understanding of energy consumption and load profiles. Its solution included optimizing heating and cooling schedules, changing temperature set points, installing carbon-dioxide (CO2) monitors, installing lighting occupancy sensors, and retrofitting lighting to achieve greater efficiencies.
The retrofit project achieved an 18-percent reduction in electricity consumption and a 24-percent reduction in heating-fuel consumption. To ensure the perpetuation of those savings, the school district's facility managers and the HVAC company's engineering team continuously monitor and verify energy consumption.
Page 2 of 3
District-cooling retrofit and performance contract
Facing rising energy costs, aging infrastructure, and budget cuts, the North Carolina state government was looking to reduce energy consumption. It knew there was cost-savings potential in the existing chilled-water loop at the State Capitol in Raleigh, but did not have the money to fund a retrofit project. Knowing it would need to solicit third-party financing for the project, the government issued a request for proposals from performance-contracting firms. The request specified the state was open to new ideas and seeking creative solutions.
A provider of energy and energy-related products and services was awarded the contract based on its plan to retrofit existing assets and expand the district-cooling loop. The improvements included lighting upgrades, high-efficiency HVAC equipment, new energy-management control strategies, water-conservation initiatives, and a significant expansion and upgrade of the district-cooling system.
The district-energy solution integrated four technologies: district cooling, thermal-energy storage (TES), a chilled-water plant, and improved chilled-water delta-T.
The provider of energy and energy-related products and services for the North Carolina State Capitol selected a maker of wire-wound concrete tanks to build a 2.7 million-gal. chilled-water TES tank to augment the new high-efficiency chiller plant. With TES, the state was able to shift load to nighttime use in charging the tank, which, in turn, enabled the state to take advantage of time-of-use rates and use stored chilled water during daytime peak periods. Additionally, TES reduced project capital cost by decreasing the chiller-plant capacity necessary to support full load.
The state signed a 12-year performance contract with the provider of energy and energy-related products and services, and each building now is metered independently and billed in accordance with its own standard electric-utility tariff.
As the campus of the University of La Verne in La Verne, Calif., grew, improving plant efficiency and lowering facility costs became a top priority. To that end, the university's facilities department, working with an HVAC maintenance, service, building-automation, and retrofit contracting company, sought to optimize its HVAC system at the same time it upgraded its centrifugal-chiller plant.
Page 3 of 3
The central-plant expansion included the addition of a chiller and the conversion of the primary/secondary pumping loop to an all-variable-speed/primary-only system. Additionally, the university installed two components of ultrahigh-performance HVAC-optimization software: one that continuously gathers information about campus building loads and controls pump and chiller speeds to match central-plant chilled-water supply to real-time demand and another that provides the university's plant managers secure, real-time Web-based monitoring that enables automated measurement and verification, trend-data viewing, and energy-savings tracking. The combination of these software components is expected to ensure optimized HVAC-system performance for the life of the plant.
With the production of only the amount of chilled water required to maintain building comfort, the university's chiller-plant efficiency increased by 47 percent during the first six months of operation. During this time, the plant operated at an average of 0.55 kw per ton, compared with an average of 1.04 kw per ton prior to installation. Additionally, the project was supported by a $14,000 utility rebate. During the first year of operation, the university is expected to save more than 125,000 kwh of electricity and more than 70,000 gal. of water and reduce its carbon footprint by approximately 160,000 lb.
On-site solar-power generation
The Shops at Mission Viejo in Mission Viejo, Calif., operated by Simon Property Group, is the site of a 20,000-sq-ft solar-roof installation. During its first two months of operation, the 173-kw system created 24,510 kwh, which offset 33,047 lb of CO2 emissions. The 1,020 panels supply about 5 percent of the 4.2 million kwh the 1,150,591-sq-ft mall consumes annually.
Construction began Dec. 3, 2008, and was completed 20 days later. The project was funded partially through utility incentives, which helped mitigate total project installation cost by improving both project payback and net-present-value financial performance. To pay for the system, Simon Property Group entered into a multiyear power-purchase agreement with the project developer.
Combined heat and power (CHP)
When Shands HealthCare decided to build a cancer center in hurricane-prone Gainesville, Fla., it knew it needed an efficient, reliable, and environmentally friendly energy source to keep the hospital operational in the event of a power disruption. Following the Northeast Blackout of 2003 and hurricanes Katrina and Rita, emergency generators no longer are seen as viable for state-of-the-art digital hospitals. Shands required an on-site energy system that would keep the facility operational for days — not hours — after disaster strikes.
Shands selected the city-owned utility to finance, design, build, own, operate, and maintain an on-site energy center as part of a 50-year contract. The utility determined that a CHP energy system would be more efficient, reliable, and cost-effective than an N+1 emergency backup-generator solution.
The utility selected an international engineering consultant to manage the design and construction of the energy plant. The CHP system consists of a 4.3-Mw gas turbine capable of producing 800 bhp of steam and 2,400 tons of chilled water. Compared with a traditional central power plant, the on-site system produces 95-percent less nitrogen oxide, nearly 100-percent less sulfur dioxide, and 58-percent less CO2.
Our focus increasingly is shifting from simply using energy to managing it. The emergence of smart-grid communications infrastructure and monitoring/control technologies gradually will modify the way we consume and manage energy in our homes, offices, and factories. Just as telecommunications has evolved from basic services, the energy industry will evolve.
This new era of energy-efficiency management promises to be both fascinating and challenging. Over the next several years, with continued legislative and regulatory initiatives, we likely will see greater economic justification for market adoption. There will be more technologies — and more choices — as we look to reduce energy consumption and cost.
For past HPAC Engineering feature articles, visit www.hpac.com.
Peter Armstrong is a strategic-marketing and business-development professional with more than 15 years of experience in the global energy industry. He can be contacted at firstname.lastname@example.org.
Data courtesy of Pepco Energy Services