Post on 25-Jun-2018
Energy Management Measures
Evaluation and Financing
Energy Management
Carlos A. Santos Silva
Outlook
Energy Efficiency Measures
Project Evaluation
• Definitions
• Evaluation metrics
• Example
Financing Energy Efficiency
• Performance Contracts
• IMPVP
Energy Efficiency Measures
Implementing Energy Efficiency
Energy Audit
ECM
Design and Implementation
Measurement and Verification
Energy Conservation versus Energy Efficiency
Energy Conservation: use less of a certain energy service
• Eliminate Waste
• Rational use• Eliminate stand-by is a energy conservation measure
• Using natural light instead of artificial light
Energy Efficiency: use less energy resource for the same service
• More efficient appliances
• Alternative energy sources
• Alternative processes• Replace light bulbs by fluorescent lights
• Heating hater with solar energy
Implementing Energy Efficiency
Energy Audit
EE Measures
Design and Implementation
Measurement and Verification
Energy Efficiency Measures
Reducing load
Increasing efficiency
Reducing unit energy cost
Space heating and Cooling
Reduce heat exchange losses through the envelope
• Insulation
•Ceilings
•Floors
•Walls
•Light colored external surfaces
Reduce heat exchange losses through
windows
Reducing heating losses
• Open blinds and shades on sunny winter days, and close them at night
• Use an inexpensive door sweep to reduce air leakage under exterior doors
• Install Air-Lock vestibule system or revolving doors
• Reduce heat to unused rooms in the house, and close their doors.
Reducing cooling losses
• Open windows at night to bring in cool night air and close them and the blinds and shades during the day
• Shade west facing windows
• Plant trees that leaf out during the cooling season on the west and south sides of your house.
HVAC systems
• Reducing heating losses
– Set the air conditioning to a maximum of 20°C
– Close fireplaces when not working
• Reducing cooling losses
– Set the air conditioning to a minimum of 25°C
• All year round• Clean filters regularly
• Schedule automatic control
Hot Water
Boilers
• Reduce the temperature setting of your water heater to 40 °C maximum
• Reduce hot water loads
• Add an insulating wrap to older water tanks
•Due maintenance
• The main inefficiency source is lack of excess air
Appliances
Freezers and Fridges
• Regular operation
• Keep your refrigerator door closed whenever possible.
•Maintain your refrigerator between 3-5°C
•Maintain your freezer at -18°C.
•Disconnect fridges not very used or old
•Maintenance
•Unfroze once a year to avoid ice build-up
• clean dust out of the coils behind and/or under
Cooking appliances
Use microwave ovens for cooking small meals
Adjust the flame on gas cooking appliances so it is blue,
not yellow
Use toasters, kettles and coffee pots with time limited
shut off switches
House keeping
Run clothes and dishwasher only with a full load / or
use half load programs
• Air dry dishes in your dishwasher
• Wash clothes in cold water (40°C at the most)
Do not overload your dryer as it takes clothes longer to
dry.
Use irons with time limited shut off switches
• Switch it off even for small breaks
Entertainment
Shut down home computers or put them on sleep mode
when not in use.
Plug small electronics into a power strip so you can turn
them off at the same time.
Turn off the TV when no one is viewing it
Lighting
Use
Turn off lights when not in use.
Use task lighting whenever possible instead of brightly
lighting an entire room.
Control outdoor lights with sensors or timers so they
stay off during the day.
Ballasts
Ballasts limit the current through an electrical load
• inductive ballast used in fluorescent lamps limit the current otherwise it would rise to destructive levels due to the tube's negative resistance characteristic
• as simple as a series resistor (LED) or inductor, capacitors, or a combination thereof or as complex as electronic ballasts used with fluorescent lamps and HIDs
Electronic ballasts
An electronic ballast uses solid state electronic circuitry to provide the proper starting and operating electrical conditions to power discharge lamps
Electronic ballasts usually supply power to the lamp at a frequency of 20,000 Hz or higher, rather than the mains frequency of50 - 60 Hz;
• this substantially eliminates the stroboscopic effect of flicker, a product of the line frequency associated with fluorescent lighting
• as remains ionized in the arc stream, the lamp operates at about 9% higher efficacy above approximately 10 kHz.
Benefits
Electromagnetic BallastElectronic Ballast
HeatWastes internal energy which generates about 30ƒ C more
heat.Reduced heat internal losses less than 8 watts results in 5-10 percent
less air conditioning costs.
Light Flicker60 Hz frequency causes light flicker levels of 30 percent or
higher; can cause headaches and nausea.20,000-25,000 Hz produces virtually no detectable flicker; does not
cause headaches and nausea.
Noise Vibration of electromagnetic field causes humming noise. No audible noise, less distracting.
Weight Heavy components coated in heavy protective material. Weighs about half as much as electromagnetic type.
EnergyRequires 30-40 percent more input for the same amount of
light output.Requires 30-40 percent less input for the same amount of light output.
Replace T5 and T8 fluorescent by LED
LED Fluorescent
Wattage 17-22 watts 25-32 watts
Lumens 1700-2200 2300-3100
Avg Cost $65/each $3-$5/each
Avg Life 50,000 hours 30,000 hours
Warranty 2-5 years 2-3 years
Replacement is easy but it may take long time…
Energy bills’ management
Energy efficiency measures
Find out which is the best tariff (and retailer)
Change processes to avoid use of peak load during
peak time
• Signs
• Coaching
• Automatic switches
• Control
Project evaluation
What is it
Methodology for assessing the economic and financial (and
social and environmental) impact of proposed capital project
• Economic analysis assesses the net worth of a project• a mean to rank projects in terms of the efficient allocation of resource
• Financial analysis assess the budgetary implications
of the project • provides information on cash flows, borrowings, funding sources, etc.
Project evaluation steps
1. Identify service need and define objectives and scope
2. Identify options to accomplish the objectives
• Narrow down the options
3. Do the economic and financial analysis of the different options
• Identify benefits (avoided costs and saving costs)
• Identify investment and operation costs
• Evaluate net benefits
• Due risk analysis and sensitivity analysis
4. Rank and choose the best option
Definitions
Present value (Valor Actual)
PV is a future amount of money that has been discounted to reflect its current value, as if it existed today.
• The present value is always less than or equal to the future value because money has interest-earning potential, a characteristic referred to as the time value of money.
Time value of money is the principle that a certain currency amount of money today has a different buying power (value) than the same currency amount of money in the future.
• The value of money at a future point of time would take account of interest earned or inflation accrued over a given period of time
A dollar today is worth more than a dollar tomorrow
Discount rate (i)
to evaluate the real value of an amount of money today after a given period of time, economic agents compound the amount of money at a given interest rate
• Most calculations use the risk-free interest rate which corresponds to the minimum guaranteed rate provided by a bank's saving account for example• short-dated government bonds is normally perceived as a good proxy for
the risk free rate
• Compound interest is multiplicative. Interest is earned on the interest that has already accrued (credited) in addition to the principal (initial amount)
Present value calculation
The present value of a certain amount of money C is given by
• where n is the number of compounding periods between the present date and the date where the sum is worth C
• i is the discout rate for one compounding period (the end of a compounding period is when interest is applied, for example, annually, semiannually, quarterly, monthly, daily). • The interest rate i is given as a percentage, but expressed as a decimal in
this formula
Cash flow (CF)
Movement of money into or out of a business, project, or
financial product
• measured during a specified, limited period of time
• It corresponds to savings and earnings directed
related to the project implementation
Costs
value of money that has been used up to produce
something, and hence is not available for use anymore
• Investment costs – value used to buy an asset
required to the project
• Operation costs – value used to operate the asset
required to the project
• Fixed costs – value of money spent because there
is a project going on
Evaluation metrics
Net presente Value (VAL)
sum of the present values of the individual cash flows
(R) of the same project
• Where N is the number of periods (months, years)
under analysis
• i is the interest rate
• Rt is the cash flow in period t
NPV analysis
NPV > 0the investment would add value
to the firmthe project may be accepted
NPV < 0the investment would subtract
value from the firmthe project should be rejected
NPV = 0the investment would neither gain nor lose value for the firm
We should be indifferent in the decision whether to accept or reject the project. This project
adds no monetary value. Decision should be based on other criteria, e.g., strategic
positioning or other factors not explicitly included in the
calculation.
Payback period
period of time required for the return on an investment to "repay" the sum of the original investment
• The time value of money is usually not taken into account
• It does not account for future cash-flows
It gives an indication, but it should not really drive the decision
Internal Rate of Return (IRR)
annualized effective compounded return rate that makes
the NPV equal to zero
• Value of r that makes
• It has to be calculated iteratively• In MS Excel use” goal seek” function
IF IRR is higher than the cost of capital, accept the project
Financing Energy Efficiency
Energy Savings Performance Contracts
Alternative financing mechanism
designed to accelerate investment
in cost effective energy
conservation measures
• usually performed by ESCO and
the management of the facility
Contracting modelsShared Savings (energy savings):
the cost savings are split for a pre-determined
length of time in accordance with a pre-arranged
percentage
• client takes over some performance risk, hence it
will try to avoid assuming any credit risk
• The ESCO therefore assumes both performance
and the underlying customer credit risk
Savings Guarantee (cost savings):
the ESCO guarantees a certain level of energy savings and in this way shields the client from any performance risk.
• If the savings are not enough to cover debt service, then the ESCO has to cover the difference.
• If savings exceed the guaranteed level, then the customer pays an agreed upon percentage of the savings to the ESCO
Source: Dreessen 2003
Measure & Verification
M&V Definition
• Process to quantify the savings associated with the implementation of energy efficiency
measures
– Measures energy, not the cost
– It is necessary to evaluate economic savings
– It is based in the application of a methodology
• International Performance Measurement and Verification Protocol (IPMVP)
• ASHRAE Guideline 14:Measurement of Energy and Demand Savings
• eeMeasure
IPMVP
M&V Protocol
(set of different documents)
Volume I – defines and presents thefundamental principles of M&V,
describes a framework for a detailed M&V,
Volume II - provides a comprehensive approach to evaluating building
indoor-environmental quality issues that are related to ECM design,
implementation and maintenance; suggests measurements of indoor
conditions to identify changes from conditions of the baseline period
Volume III - provides greater detail on M&V methods associated with new building construction (Part I),
and with renewable energy systems added to existing facilities (Part II)
Managed by Efficiency Valuation Organization
M&V Activities (IPMVP)
meter installation calibration and maintenance
1
data gathering and screening
2
development of a computation method and acceptable estimates
3
computations with measured data
4
reporting, quality assurance, and third party verification of reports
5
Application (IPMVP)
M&V Options
Operational Verification of ECM
Option A
Option B
Option C
Option D
Retrofit Isolation
(A or B)
• Only the performance of the systems affected by the ECM is of concern, either due to the responsibilities assigned to the parties in an energy performance contract, or due to the savings of the ECM being too small to be detected in the time available using Option C.
– Interactive effects of the ECM on the energy use of other facility equipment can be reasonably estimated, or assumed to be insignificant.
• Possible changes to the facility, beyond the measurement boundary, would be difficult to identify or assess.
– The independent variables, which affect energy use, are not excessively difficult or expensive to monitor.
• Sub-meters already exist to isolate energy use of systems.
• Meters added at the measurement boundary can be used for other purposes such as operational feedback or tenant billing.
• Measurement of parameters is less costly than Option D simulations or Option C non-routine adjustments.
• Long term testing is not warranted.
– There is no need to directly reconcile savings reports with changes in payments to energy suppliers.
Option A
Choosing M&V Option
Uncertainty management
Types of Error
• Errors occur in three ways: modeling, sampling, and measurement:
– Modeling. Errors in mathematical modeling due to inappropriate functional form, inclusion of irrelevant variables, exclusion of relevant variables, etc.
– Sampling. Sampling error arises when only a portion of the population of actual values is measured, or a biased sampling approach is used. Representation of only a portion of the population may occur in either a physical sense (i.e., only 20 of 1,000 light fixtures are metered), or in the time sense (metering occurring for only ten minutes out of every hour).
– Measurement. Measurement errors arise from the accuracy of sensors, data tracking errors, drift since calibration, imprecise measurements, etc. The magnitude of such errors is largely given by manufacturer's specifications and managed by periodic re-calibration.
Confidence and Precision
• Precision is the measure of the absolute or relative range within which the true value is expected to occur with some specified level of confidence.
• Confidence level refers to the probability that the quoted range contains the estimated parameter.
– Confidence refers to the likelihood or probability that the estimated savings will fall within the precision range
– A statistical precision statement (the ±20% portion) without a confidence level (the 90% portion) is meaningless.
• Savings are deemed to be statistically valid if they are large relative to the statistical variations
– savings need to be larger than twice the standard error
– If the variance of the baseline data is excessive, the unexplained random behavior in energy use of the facility or system is high, and any single savings determination is unreliable.
How to improve
• Where you cannot meet this criterion, consider using:
– more precise measurement equipment,
– more independent variables in any mathematical
model,
– larger sample sizes, or
– an IPMVP Option that is less affected by unknown
variables.
Statistical Measures
• Sample Mean
• Sample Variation
• Sample Standard Deviation
• Sample Standard Error
• Sample Standard deviation of the total
• Coefficient of variation
Absolute precision
Example
Example
Modeling errors
Routine adjustments modeling
Coefficient of Determination (R2)
Standard error of estimate
Example
• Occupancy is a measure of percent
occupancy in the building. – In this model 342,000 is an estimate of
baseload in kWh,
– 63 measures the change in consumption
for one additional HDD,
– 103 measures the change in
consumption for one additional CDD,
– 222 measures the change in
consumption per 1% change in
occupancy.
monthly energy consumption = 342,000 + (63 x HDD) + (103 x CDD) + (222 x Occupancy)
Implementation Example
Situation
More efficient light fixtures are installed in place of existing fixtures in a Canadian school, while
maintaining light levels.
– This project was part of a broader program of the school board to hire a ESCO, who
would design, install and finance many changes in a number of schools.
– Payments under the contract are based on measured savings at the utility prices
prevailing at the time of signing the contract.
– Savings are to be demonstrated, according to an IPMVP adherent M&V Plan,
immediately after commissioning of the retrofit
– Since the owner controls operation of the lights, the contract specified that the M&V
Plan will follow Option A, using estimated operating hours
Factors Affecting the M&V Design
• All light fixtures are powered by a common 347-volt supply system dedicated to lighting. This situation makes power measurement simple.
• Operation of lights significantly affects heating energy requirements, so the interactive effect needed to be estimated.
• Operation of lights significantly affects mechanical-cooling requirements. However, since very little of the school is mechanically cooled and that space is usually vacant during the warmer weather, cooling interactive effects were ignored.
• School-board officials had difficulty accepting an arbitrary assumption of lighting operating periods. They agreed to pay for a carefully instrumented two-month period of logging lighting patterns in one school. This test This test would substantiate the estimated operating hours that would be agreed for all schools.
M&V Plan
• The measurement boundary of this ECM was drawn to include the lighting fixtures
connected to the 347-volt supply system.
– The heating interactive effect was determined by engineering calculations to be a
6.0%increase in boiler-output energy requirements, for the period from November
through March. Boiler efficiency in winter was estimated to be 79% under typical winter
conditions.
– The static factors recorded for the baseline included a lighting survey giving a
description, location, light level, and count of the number of operating and burned out
lamps ballasts and fixtures.
– 30 lighting loggers were placed in randomly chosen classrooms, corridors, locker
rooms, and offices and also in the gym and auditorium, for two months. This period
included the one-week spring holiday and two legal holidays.
Data
• For the 19 classroom loggers, the standard deviation among the readings for 6 recorded
school weeks was found to be 15 hours per week. With 19 x 6 = 114 readings, the standard
error in the mean values was computed to be 1.4 hours per week
Estimations
• Since the lighting retrofit was applied uniformly to all fixtures, the load-weighted
average estimated annual operating hours for this school were determined to be 2,996 (
3,000).
Savings calculation
• Baseline power measurements were made with a recently calibrated true rms watt meter of the three-phase power draw on the 347-volt lighting circuits
• From a thirty-second measurement on the input side of two lighting transformers, it was found that with all fixtures switched on, the total power draw was 288 kW.
– Seventy lamps (= 3 kW or 1%) were burned out at the time of the test. It was determined that the fraction burned out at the time of this measurement wasnormal.
• Since lighting loads establish the building electrical peak at a time when all lights are on, electrical demand savings will be estimated to be the same as the measured load reduction on the lighting circuits.
– The utility bills showed a lower demand during the summer holidays
• July and August lighting circuit demand is only 50% of the peak measured circuit load
• The marginal utility prices at the time of contract signing was CDN$0.063/kWh, CDN$10.85/kW-month, and CDN$0.255/m3 of gas.
Results: Savings in electricity
• After installation of the ECM, the lighting circuit power was re-measured as in the baseline test.
– The power draw was 162 kW with all lights on and none burned out.
– With the same 1% burnout rate as in the base year, the post-retrofit period maximum power would be 160. kW (=162 x 0.990). • The power reduction is 288. – 160. = 128 kW.
• Energy savings with no adjustments are 128 kW x 3.00 × 103 hrs/year = 384,000 kWh/year
• Demand savings are 128 kW for 10.0 months and 64 kW for 2.0 months, for a total of 1,410 kWmonths.
Results: Savings in gas
• Assuming the lighting savings are achieved uniformly over a 10 month period, the typical winter month electrical savings are 384,000/10 = 38,400 kWh/month.
• The associated boiler load increase is 6.0% of these electrical savings for November through March, namely:
– 6.0% x 38,400 kWh/mo x 5.0 months = 12,000 kWh
• Extra boiler input energy is:
– 12,000 kWh / 79% = 6.0% x 38,400 kWh/mo x 5.0 months / 79% = 15,000 kWh
• The gas being used in the boiler has an energy content of 10.499 kWh/m3, so the amount of extra gas is = 15,000 / 10.499 = 1,400 m3 gas
– The value of the extra gas used in winter is 1,400 x $0.255 = CDN$360.
total net savings = $39,500 – $360 = CDN$39,100.