Against the Wind* – Making Money in the Wind Business in New Hampshire – Part 2

Somebody's Backyard - Coal Fired Power Plant and Wind Turbines

Following up on my post Blow Wind Blow, where we took a look at the revenue side of the wind business, this week we take a look at the cost aspects of running a wind farm. One pleasing aspect of the wind business is that there are a lot of organizations promoting wind energy and, as a result, there is a lot of information available about wind and the costs associated with wind projects. The challenge is shifting through this information and pulling out the data relevant to New Hampshire wind projects. I have found the information from the American Wind Energy Association, AWEA, and particularly that from the National Renewable Energy Laboratory, NREL, to be particularly useful.
 
Another challenge associated with working through the wind cost data is that wind project financing is a complicated business. There is equity and debt financing, there are investors who contribute simply to access the tax credits and there are funding and repayment mechanisms that change part way through the life of the project. All of these different mechanisms are used raise funds from different groups of investors and to accelerate returns to the original core group of investors. Wind project financing gets rather involved and it can change considerably on a project-to-project basis, making comparisons difficult. To simplify our analysis, I have found the best basis of comparison, across different wind projects and renewable energy technologies, is to determine the levelized cost of energy, LCOE.

The LCOE is a way of calculating the aggregate costs for an energy project and takes into account the overall capital investment in the project as well as the annual operating and maintenance costs over the life of the project. Using the time value of money, all future costs are discounted, using a minimum desired return, to the present and are then divided by the discounted total of energy produced from the project to provide a single number that is indicative of the all-in cost of electricity from the project. Normally on any energy project, the LCOE is the first calculation performed as it is relatively easy to do. As the project development progresses, the calculations become more involved and sophisticated as different funding mechanisms are considered. Sometimes LCOE calculations include taxes and incentives but I have taken those into account in my revenue calculations in my last post so I have not included them in my calculations. I refer you to this NREL source should you want to learn more about calculating LCOE.
 
Wind projects take a long time to get off the ground. There are years of wind monitoring for a selected site, environmental impact studies, navigating local property tax payments and overcoming local opposition and legal hurdles. In addition, power purchase agreements and transmission line access have to be negotiated. This can sometimes take three to four years and a great deal of investment before ground is broken on a project. Even with years of upfront work, success in not guaranteed, as the NH Site Evaluation Committee recent rejection of the Antrim, NH, wind project has demonstrated.
 
Once all the approvals are obtained then the major expenditures in site preparation, road construction, foundations, turbines, turbine installation and transmissions lines are incurred. The wind business is a capital-intensive business and the installed costs of new wind turbines range from $2 million to $2.5 million per megawatt. Based on published investment costs for the NH wind projects, the costs in NH are of the order of $2.5 million/MW (see table below), most likely due to the local permitting challenges and installing the turbines high up on ridge lines. As a comparison, establishing a gas-fired combined cycle plant costs about $800,000 per megawatt – one third of the cost of a wind energy operation.
 
The other important costs are the annual operating and maintenance costs associated with wind operations. Unlike the gas-fired power plants, the good thing about wind projects is that there no fuel costs. Operating costs for wind energy operations include fixed annual costs, like land lease costs, state and local property tax assessments, maintenance contracts, the operating staffing associated with the wind farm as well as other general administrative costs like insurance. Variable costs include the costs of electricity to power the operation as well as unanticipated maintenance costs which tend to increase over the life time of the operation. Exact costs for all costs components vary from project to project and tend not to be available for specific projects. As a result, one has to rely on published data and industry averages. The table below provides the capital investment, land lease and property tax costs and estimates associated with the various NH wind operations that I have been able to assemble from various publications. The table also shows the calculation of these costs on a per megawatt basis. Overall, the installed capital costs for these projects have been of the order of $2.5 million/MW and the weighted average of the fixed land lease and property tax portion costs are $27,000/MW ($27/kW) per year.
 

The figure below shows the various costs components as well as my estimates of these for the NH wind projects. The cost data reflect averages and my estimates rather than specific costs associated with any particular project. These costs were then used to calculate the LCOE for a typical NH wind operation - which I estimate to be $126/MWh ($0.126/kWh). The operating costs, fixed and variable, when converted to the cost of MW of electricity produced, are of the order of $20/MWh. The annualized capital costs are $106/MWh, demonstrating that the majority of the cost, 84%, of producing electricity from a wind farm is related to the large upfront capital investment.

I will note that my calculated costs are higher than the $71/MWh national average calculated by NREL. The difference is due to the following:

• The capacity factors for NE wind projects – typically 0.30 – are lower than the national average of 0.38;
• The capital costs of $2.5 million per MW I have used are higher than the $2.1 million figure used by NREL;
• The non-capital related operating costs used by NREL are $10/MWh which are lower than my estimate of $20/MWh.

In the figure below I have incorporated my revenue diagram from my last post with the cost diagram above to provide a comparison of the revenue and cost structure on a single figure so you can get a sense of the margins in the wind business. It is important to bear in mind that revenues and costs vary over time and are different for each specific project. Many of the costs are fixed but the revenue that wind farms can obtain from electricity and REC sales can be highly variable and dependant on customer demand and negotiated power purchase agreements. Overall profitability, of course, is also very much dependent on how hard and how often the wind blows.

One might argue about some of the specific details associated with my cost estimates but they do reflect the fact that operating wind farms in NH is rather different to an equivalent (and often much larger) operation on the great plains of Nebraska. It is my assessment that the costs of NH wind electricity are high: the importance of subsidies from the production tax credits and the sales of RECs are therefore very important to the wind industry. The subsidy portion of the revenue stream is 50% or more of the overall revenue. Without these subsidies these wind farms would be under pressure to make money and they would definitely find themselves struggling to make headway against the wind* in a high cost and low subsidy environment.

Until next time, remember to turn off the lights when you leave the room.

Mike Mooiman
Franklin Pierce University
mooimanm@franklinpierce.edu
6/18/13

(*Against the Wind – A 1980 album and tune by Bob Seger. An oldie but goodie suggested by blog reader Laurie Smith from South Africa. Bob Seger had a thing for mid-tempo ballads telling stories of struggle and sometimes redemption. Here is the link – Against the Wind)

 
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Blow Wind Blow* – Making Money in the Wind Business in New Hampshire – Part 1

Overhead View of Lempster Wind Farm Taken by Author

In my post Windfall, I briefly discussed some of the business aspects of New Hampshire wind farms and some of the challenges they might face. There is a lot more to the wind business here in New England, and I thought it would be interesting to take a deeper look at some of the revenue and cost considerations these operations face over my next two posts. This week we take a close look at some of the revenue aspects of these wind operations.

Let's start with the recent performance data from FERC for these wind farms. The table below shows the summarized first quarter of 2013 results for the three operating wind farms in New Hampshire, the two Iberdrola operations – Lempster and Groton – and the large Granite Reliable operation located near Dixville.

 It is clear that they did well in the first quarter. A few points of note:

• The Lempster operation output was remarkably high, particularly for the month of January, and they are showing capacity factors for the quarter of 0.42 which is surprisingly large. The average price they received for their electricity was $77.17 and, at times, it was as high as $102.99 /MWh. Clearly they have an attractive power purchase agreement with PSNH.
• After a miserable year last year, the Granite Reliable operation did much better with a first quarter capacity factor at 0.29 which is up from last year's value of 0.15. The bulk, 83%, of their sales went to the two Vermont utilities at rates averaging $96.57/MWh. However, there were times they were selling into the ISO-NE electricity pool at rates as low as $0.66/MWh.
• The Groton Wind operation is now up and running and all their sales went to NSTAR Electric at $51.65. Their overall capacity factor for the first quarter was 0.25.
   

In my last post, I pointed out the poor performance of the Granite Reliable operation, which only had a capacity factor of 0.15 for 2012, and which was half of the expected value of 0.30. During the week, a number of knowledgeable readers pointed out to me that the reason for the low output and capacity factor for the Granite Reliable operation in 2012 was that ISO-NE had put in place curtailment orders for several New England wind farms. This meant that they were required to reduce the amount of electricity they were delivering into the grid even if they could produce more. The curtailment orders included the Granite Reliable operation, which had to ratchet down its output to about 50% of its rated capacity of 99 MW. The reasons behind the curtailment orders appear to be reduced demand for electricity as well as grid load imbalances in certain areas. Wind-based electricity is a challenge for the electrical grid operator, ISO-NE, as electricity production from these operations is highly variable and, with the growing number of wind operations, the variability of electricity supply has increased. At the same time, the grid operator has to manage the output from fossil fuel and nuclear power plants that supply a great deal of our base load power and that cannot rapidly be turned up or down in response to varying output from wind farms. Curtailment orders for these wind farms is one way to manage the variability but that does leave the owners of these operations with unused capacity and lost revenue opportunities.

Wind farms get revenue from a number of sources. The first is from the sales of electricity, which could be via a power purchase agreement (PPA), such as the one the Groton operation has with NSTAR, that sets a fixed price for the price of generated electricity, or if could be by direct sales into the ISO-NE electricity pool where prices are set by supply of and demand for electricity. Prices for electricity sold into the ISO-NE pool can be highly variable over time as I noted in It Don't Come Easy and there are considerable price swings, even over a day, as shown by the chart below which provides 5 minute electricity prices for last Thursday, June 2, 2013. In the first quarter of 2013, the three NH wind farms earned almost $9.2 million dollars on total electricity sales of 112,084 MWh to earn an average of $82/MWh.

 

If you are an energy geek like me, you might be interested in tracking prevailing energy prices on the ISO-NE grid. To use a popular phrase in these smart phone days "There's an app for that!" You can download the ISO-NE ISO to Go app at this link. The app shows you local prices for electricity as well as how demand is tracking forecast and the fuels being used in the present generating mix. This morning at 6.45 am as I am writing this blog, the costs of electricity are only $24.68 per MWh. Yesterday at 3 pm when I checked, it was $45.37 per MWh. Typical screen shots you will see on this app are shown below.

 
The other source of revenue for wind farms is from sales of Renewable Energy Credits (RECs) – the so-called green tags which I discussed in It Don't Come Easy - which allow generators of renewable energy to sell the renewable energy attributes separately from the underlying electricity. The pricing for Class 1 RECs, which is the class that wind generated electricity falls into, is also variable but prices are presently high due to elevated demand. In fact, the prices are bumping up against the alternative compliance payments for the Class 1 RECs of $65/MWh. Alternative compliance payments are the fines that state-regulated utilities have to pay if they do not meet their renewable energy quotas and they set a cap on the REC market. Class 1 NH wind REC prices have risen from their lows of $15 in 2010 to their present value of about $62/MWh. Here is a link to a great article on recent Class 1 REC pricing.

 Another revenue source for wind operations, albeit an indirect one, is that associated with production tax credits (PTCs) for wind generation. The PTC is a federal incentive program for the wind industry that provides producers of wind-generated electricity a tax credit of $23.00 for every MWh of produced electricity for the first 10 years of the project. I know the PTC is a tax credit and not a revenue item, but for the purposes of my analysis this week, I am including the revenue category. But to do so, I must calculate its before tax equivalent. A tax credit of $23/MWh is equivalent to a revenue item of $35.38 MWh for a company with a 35% federal tax rate. (This might not apply to a tax-evading company like Apple - but that is an axe to grind another day). The lower the tax rate, the lower will be the revenue equivalent.

In some cases, wind operations that sell electricity into the ISO-NE pool might receive payments for holding capacity available should demand increase and ISO-NE needs to draw on more generators. These payments can be considerable and for the Granite Reliable operation they are of the order of $151,000 per month. These are fixed payments but for the basis of my comparison, I have, on the basis of the Granite Reliable capacity payments, calculated them to be equivalent to $8.30/MWh (assuming a capacity factor of 0.25).

In summary here are the four main revenue components for the wind farms:

• Electricity Sales - Presently these average about $82/MWh (2013 first quarter weighted average) but can range from $25 to $100/ MWh depending if sales are through a power purchase agreement or delivery into the ISO-NE electrical pool.
• Sales of RECs – Presently about $62/MWh.
• Revenue equivalent of production tax credits - $35/MW (dependent on federal tax rate).
• Capacity payments – these are of the order of $8/MWh if a wind farm participates in the ISO-NE forward capacity market. Not all wind farms do.

The figure below summarizes the revenue flows.

These four revenue items total $187/MWh, which is equivalent to $0.187/kWh. Compare this to the ~$0.08/kWh we typically pay for energy portion of our electricity bills at our homes. I don't know about you, but I am impressed at the revenues the wind farms are earning. With this sort of revenue stream, wind operators clearly start each day with the prayer, "Blow Wind Blow"*. Needless to say, not all wind farms earn these revenue streams all the time but these numbers do indicate that wind farm revenue is a whole lot more than just the sale of electricity. Subsidies generated by  the RECs and PTCs provide 50% or more of the revenue  equivalents for these operations.

 

Of course, this is only half of the picture. Establishing wind farms is a capital-intensive and lengthy business and there are a lot of hurdles to overcome. For example, just this week we learned that the small 15 MW Kidder Mountain wind operation in the New Ipswich/Temple region will be scrapped. The developer, Timbertop Wind Energy, could not find a way to deal with the different ordinance issues presented by the two communities. The NH site evaluation committee declined to take jurisdiction of the project as the wind farm development was below 30MW. In my next post, we will take a look at the costs of establishing and running a wind farm.

Until next time, remember to turn off the lights when you leave the room.
 
Mike Mooiman
Franklin Pierce University
mooimanm@franklinpierce.edu
6/9/13
 
(*Blow Wind Blow – A classic Muddy Waters blues tune covered by a bunch of artists. Here it is by Eric Clapton. Enjoy.)

 
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Windfall?* – Wind Energy in New Hampshire

In March last year I went skiing at Crotched Mountain, near Bennington, NH, with my son. It was a perfect day for skiing – the weather was mild, the sun was shining and, most importantly, the lift lines were short. A couple of times that day we took a breather at the top of the mountain to admire the view and we briefly considered the wind power potential of the site but I had no idea at that time that I was skiing at the site that was the birthplace of the wind energy industry.

In 1980 a company by the name of U.S. Windpower established the first wind farm in the world by erecting twenty 30 kW wind turbines on Crotched Mountain. The design was based on research and development work conducted by Professor William Heronemus at the University of Massachusetts, Amherst. For a variety of reasons, including unreliable equipment and poorly understood wind resources, the project was not a commercial success and was dismantled after a year, but the developer went on to set up wind farms in California which were not a commercial success either. Nevertheless, a lot was learned from these projects and failures and these early efforts were the genesis of the wind energy industry as we know it today. It is quite remarkable to consider, that starting with establishment of the Crotched Mountain operation in 1980, we have moved from an installed wind energy capacity of 0.6 MW from 20 turbines to approximately 282,000 MW of worldwide capacity from over 200,000 turbines in the space of about 30 years. In the process we have gone from wind turbines with 15 ft long blades powering 20 kW units to turbines with blades longer than 200 ft powering 7.5 MW units. This is an impressive advance in engineering technology and a testament to what we can accomplish when incentives and subsidies are available. As my students in the Franklin Pierce MBA in Energy and Sustainability Studies learn, successful energy development requires the combination of correct government policies, the correct technology and financial incentives.

After the Crotched Mountain project not much happened in NH wind-wise until 2008 when Iberdrola, the large renewable energy company based in Spain, established their first NH-based wind farm on the hilltop ridges near Lempster. Since then we have had two other wind farms established near Groton and Dixville Notch and there are a bunch more seeking permitting or in development.

The key reason that wind development has not taken off in a bigger way in New Hampshire is that we simply do not have the wind power potential that is present in other parts of the US. As you can see from the US 50 meter (165ft.) wind resource map below, most of the US wind resources lie in the center of the country, from Texas up to North Dakota. This is where the wind blows the hardest and most consistently and these are the choice areas for the establishment of large land-based wind farms.

 If we take a closer look at NH, we can use the 50 meter wind resource map shown below to examine where our winds blow the hardest. The areas of most interest are those highlighted in purple, red and blue. The high wind resources are towards the western side of the State and increase in power as we curve over to the north in the White Mountains area.

I have overlaid on this map the locations of the operating and proposed wind projects in New Hampshire so you can gauge where these operations are relative to the high wind resources and you can also assess where future projects might be sited. The table that follows provides the key for the locations shown on the map as well as information about the various operations.

The challenge with wind energy in NH is that, in order to harness the wind resources, we are forced to put wind turbines up at high elevations on mountain ridges. As a result there are wind turbines – 70 at last count - popping up on hilltops in New Hampshire which, according to your perspective (and location relative to the turbines), can either be the worst thing that ever happened to the wilderness of NH or part of necessary transition as we begin our move away from our dependence on fossil fuels. I do appreciate the argument that, because wind does not blow all the time, we always need a fossil fuel backup for these turbines. However, we should take into account that we are not breaking new ground and building new coal or natural gas power plants every time we put up a wind farm in the USA. What is happening is that, in the developed world, we are slowly ratcheting down the output from existing fossil fuel plants and reducing our output of greenhouse gases and other pollutants from these operations. Every ton of carbon dioxide that we do not emit is, to my mind, a good ton of carbon dioxide. By my estimate, the 282,000 MW of worldwide installed wind capacity led to ~740 million tonnes of carbon dioxide that we did not emit. I know this pales in comparison to the ~33 billion tonnes we likely emitted in 2012, but this is a start and every bit does help.

I also did some research at the Federal Electricity Regulatory Commission (FERC) website to see exactly how much power the three operating wind facilities are actually generating compared to their proposed output. One frequent condemnation of wind power is that the operations don't often measure up to their proposed output and therefore they are a waste of money and tax payer dollars created by subsidies and incentives. I wanted to see if that was the case and how the NH wind farms performed compared to their projections. One way of doing so is calculating the capacity factor, which is what I have done based on the FERC reports of energy sold by the various NH wind operations in 2012. If you recall from the I've Got the Power! post, the capacity factor is the ratio of the actual energy produced by a power plant to the theoretical amount that would have been produced over a year if the plant was operated 24 hours and 365 days of the year. The 2011 data from that post indicated that for the single wind farm in that set of data, the Lempster project owned by Iberdrola, the capacity factor was 0.314 (31.4%). In New England capacity factors for large-scale wind farms range from 0.15 to 0.35 with averages around 0.25.

The only two wind farms that operated throughout 2012 were the Lempster operation and the Granite Reliable Power facility near Dixville. The other operating plant, the Iberdrola Groton Wind facility, only started up in about October last year so there were very few energy sales and, as such, there were insufficient data to calculate capacity factors.
The table below shows their actual electricity production and the calculated capacity factors. I have also included the average prices for their electricity sales.

As you will note, the Lempster operation has a relatively good capacity factor compared to most NE wind projects but the Granite Reliable Power facility only has a capacity factor of 0.15 which is rather low, as is the price it is getting for its electricity.

The low output from the Granite Reliable Power wind farm is a bit of a puzzle. Based on the NH wind resource map I would have expected the higher wind speeds in the northern part of the State to translate into higher capacity factors. There are a number of reasons that energy generation numbers would be lower than expected, including

• Lower than estimated wind speeds
• Turbulent wind conditions
• Wind turbine mechanical problems
• Deliberate output reductions due to lack of demand for produced electricity

I have not been able to determine the actual cause for the low output but, considering that Granite Reliable Power sells directly into the ISO-New England electricity pool, demand, as well as the price for its generated electricity, are dependant on what other power plants are bidding. However, the wind farm has very low operating costs as they have no fuel costs, so I would have expected that they would always make the choice to deliver into the pool even at the lowest clearing price. Perhaps my understanding of the electrical markets is not clear and I look forward to being set straight by someone with a better knowledge of these markets. Regardless, if I was owner of this operation, I would be somewhat grumpy about this situation and envious of the performance and higher prices obtained by the Lempster operation which has a power purchase agreement with Public Services of New Hampshire to purchase all its output.

At the end of this year it will be interesting to compare the output and capacity factors of all three operating wind farms and particularly to compare the operations of the two Iberdola facilities. If I were the developer of the large North County Wind facility planned for Coos County, I would be taking a very careful look at the performance of the Granite Reliable wind project and double checking my energy and revenue projections.

The importance of wind energy in New Hampshire is growing as are the objections against further development. I am not sure how this will all shake out, but it is clear that wind energy in New Hampshire will not be a windfall* for all developers.

Until next time, remember to turn off the lights when you leave the room.

Mike Mooiman
Franklin Pierce University
mooimanm@franklinpierce.edu
6/2/13

(*Windfall – A fabulous tune by the group Son Volt which was a spinoff of the group Uncle Tupelo. The other Uncle Tupelo spin off was Wilco. Quite the pedigree. This week's challenge was picking the right "wind" song as there are so many to choose from - Dylan's "Blowin' in the Wind" was simply too obvious. Here is the link for Windfall – a song that makes you sad and hopeful all at the same time.)

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Cold Ground* - Considerations for Geoexchange Projects in New Hampshire – Successful Projects and Cautionary Tales

This week we are following up on my last post on geothermal energy. In this article, I take a look at the successful implementation of a large geothermal project in New Hampshire. I also present a number of issues that impact the implementation of these projects here in New Hampshire that you should keep in mind when you get ready to harness the energy in the cold ground beneath our feet.  

In last week's post, I pointed out that what we call geothermal energy here in New Hampshire should more correctly be called geoexchange. We are not using the energy deep in the earth's crust to generate steam which can be used to generate electricity: instead, we are harnessing the moderate temperatures that lie six or more feet below the surface. Using ground-source heat-pump systems we can harvest this low temperature energy as a heat source to heat our homes in the winter and then, in the summer months, we use the earth as a heat sink by pumping the excess heat in our homes into the ground. It takes energy in the form of electricity to harvest this low grade energy, but with modern heat-pump devices we can draw more energy from the earth than we consume as electricity to run these devices. It is also necessary to remember that the actual source of this energy comes from solar radiation warming the earth's surface, so geoexchange is, in effect, an indirect form of solar energy.

Geoexchange systems are used in a variety of applications, from the heating and cooling of individual homes to large systems that are used to condition multi-building college and hospital campuses. It is a technology that is finally beginning to make headway even though it has been available since the 1940s. Twenty years ago the EPA noted that "Geothermal exchange systems are the most efficient, environmentally clean, and cost effective space conditioning system available." Millions of systems have been installed worldwide, and there are probably between 1000 and 2000 of these units installed in NH alone, most of them in private residences.


A great example of a large and successful geoexchange project is that installed near Boscawen, NH, at the Merrimack County Nursing Home. This is a long-term care facility that houses about 290 residents and it has a staff of 480. It is 235,000 square feet in size and it is a thoroughly modern, well-designed and sophisticated operation providing long term care in a positive caring environment. It is the largest facility of its type in New Hampshire. A picture of the facility is shown below.
  

Source:http://www.merrimackcounty.net/nursinghome/about.html

 
The whole building is heated and cooled by a ground-source heat-pump operation. When the design of the facility was undertaken in 2005, there was an early commitment by the design team that the facility would incorporate a geoexchange system to heat and cool the facility. The result was a well-designed building that uses water drawn from 16 standing wells on the property to circulate through 326 individual heat pumps which draw the energy out of the 60^oF well water in the winter. The well water, except for a small bleed stream, is returned to the wells at 55^oF. This same system is used to provide air conditioning over the hot summer months. There is a heat pump in each of the residents’ rooms, and the residents are able to adjust the temperatures in their rooms to between 68^o and 75^oF.

During the commissioning stage, the geoexchange implementation team, as on any large-scale project, had to deal with a slew of start-up problems associated with the heat pumps, reliable circulating water pump performance and electrical wiring issues, but over time these were all solved. The system now runs smoothly and maintenance issues are few and far between. The EUI number for the present facility is about 60 kBTU/sq. ft. The US average for equivalent nursing home operations is, according to the 2003 Commercial Building Energy Consumption Survey, 124 kBTU/sq. ft. which means this nursing home has an energy foot print one-half that of its peers. Impressive performance indeed!

I had the opportunity to take a guided tour of their operations with the administrator of the nursing home, Lori Shibinette, and her facility staff. Lori is a recent graduate of Franklin Pierce University's MBA program and she is justifiably pleased at what her team has been able to accomplish with the geoexchange operation. They have no back-up fossil fuel heating system and they are solely dependent on the geoexchange system for heating and cooling and keeping 290 residents comfortable. To ensure reliable 24/7/365 operation, the system incorporates backup pumps and wells. In the case of an interruption of the electrical supply, they do have a diesel fired back-up generator on site to keep the lights on and the geothermal system running. At the start, the maintenance team was a little skeptical of the operation but they are now big fans of geoexchange system. In contrast to most boiler rooms I have been in, the main geothermal exchange control hub was a quiet clean operation with a number of pumps, a large piping manifold, and a computer-monitored control network. A picture of part of the piping manifold is shown below.

 
Costs for the geothermal operation were approximately 3% of the overall investment for the new building, which is right in line with similar systems, and the calculated payback ranges between 2 and 4.5 years, depending on what assumptions one uses. Regardless, five years after the installation, the extra costs have been recovered and the facility will now for a long, long time benefit from their low EUI and the attendant energy and costs savings. This is clearly a well-conceived and -implemented project that has delivered on its performance.

Let's turn now to a topic that has been on my mind a lot the past few weeks: the installation of a geoexchange system for a stand-alone residence. In this case, the incremental cost of a ground-source heat-pump system is a larger percentage of a new home construction project, making the investment a little more challenging to justify. As a result, homeowners need to put a lot of thought and analysis into their decision whether to install a ground-source heat-pump system or not. That is exactly what I have been doing by reading and chatting to folks about geothermal systems. As fascinated as I am by the technology, I have learned that there are a number of crucial considerations to take into account.

One of the considerations is that here in NH we have a somewhat unbalanced energy load when it comes to conditioning our homes. In my post, A Hundred and Ten in the Shade, I wrote about heating and cooling requirements in NH as indicated by heating degree days (HDDs) and cooling degree days (CDDs) and I noted that in NH we have a heating-dominated energy load as we need much more heating than cooling. In Florida, the situation is exactly opposite. This is shown by the figure below which provides the typical annual HDD and CCD day requirements for New Hampshire and Florida.

These unbalanced winter and summer energy loads can cause problems with geoexchange systems. In the winters here in NH, a geoexchange system is constantly drawing heat out of the ground to compensate for the 6000 HDDs. As a result, ground temperatures around the ground loops drop, and in poorly designed systems the heat pumps can actually draw so much heat from the surrounding ground that the ground below the surface can freeze. In winter, ground temperatures can drop to below 32^oF in closed loop systems, which is why these systems usually use antifreeze as the circulating liquid and why they must be designed and sized to operate at very low ground temperatures.

In summer, the reverse happens and heat is drawn out of the building and pumped into the ground and, as a result, the earth around the heat-pump circulating system heats up and can run as high as 75^oF for closed-loop systems. The concern with a heating-denominated load is that the heat drawn out of the surrounding area in the winter will not be compensated by solar radiation and the heat pumped into the area during the summer months during the cooling cycle:  one could ultimately get a long-term drift to lower ground temperatures which will compromise the operation of the heat pump. A well-designed ground-source heat-pump system takes these factors into account by considering the thermal conductivity of the ground and surrounding rock and ensuring that the ground loop system is provided with sufficient volume to avoid long-term temperature changes in the surrounding rock.

 In warmer areas, such as Florida, where there is a cooling-dominated load, the reverse can happen. So much heat can be drawn out of the building during the cooling season and pumped into the earth that the ground temperatures rise. On top of this you have surface ground warming from the warmer temperatures all year round and in these systems one can see a long-term drift upwards of the temperatures in the ground which compromises the performance of these ground-source heat-pump units. The figure below shows the temperature fluctuation of a closed loop system over a number of years at Stockton College in New Jersey. This was an early large-scale closed-loop system, installed in the 1990s, that had a cooling-dominated load. Over time, the ground temperatures drifted higher and eventually a cooling tower had to be installed in the geoexchange circuit to relieve some of the heat build-up in the ground.

Source: http://www.neiwpcc.org/waterresourceprotection/wrp_docs/Stiles-GeothermalatStocktonCollegeNJ.pdf

These ground temperature drift problems tend to happen more with closed-loop systems. In standing well open-loop systems the temperature swings are more moderate, ranging from 45^oF in the winter to 65^oF in the summer. Open-loop systems rely more on the temperature moderating properties of the water table. Water conducts heat better than earth or granite and slow introduction of fresh water into an open-loop system by movement of the water table and the bleed stream helps to further moderate temperatures. However a good understanding of geologic characteristics and local underground water flow is required beforehand and for these systems a test well is often drilled.

Clearly, as you can see from the discussion above, there are many critical technical considerations involved in the installation of geothermal system. Installing a high performing and reliable system requires proper design and engineering, an experienced geothermal installer and a willingness to avoid "cost savings" shortcuts. Quite frankly, this is not something that you can just rely on your local HVAC contractor to install. Involve a geothermal expert in the design of your system to ensure the equipment you are installing is not undersized or oversized.

Design of a geoexchange system is a task that involves a compromise between the geological characteristics of the area, the heating and cooling loads, the specified equipment and a natural desire to keep installation costs down. Installation costs need to be managed and you need to be very involved but, before you even start, take a look at what you can do to reduce heat loss from your building. Money spent on better insulation and improving the building envelope will help reduce the size and cost of a geoexchange system. Installation costs can then be further reduced by taking advantage of the federal and state incentives. The Federal government provides a tax rebate of 30% for the cost of a geoexchange system and, if you are a customer, PSNH will contribute up to $4500 of the costs through their Energy Star program.

The installation of a ground-source heat-pump system is a complicated endeavor. Be willing to pay for expert advice and project management so that you will end up with a well-designed and -installed system that will, like the Merrimack County Nursing Home project, deliver on its design promises when drawing energy from the cold ground* beneath our feet.

Until next time, remember to turn off the lights when you leave the room.

Mike Mooiman
Franklin Pierce University
mooimanm@franklinpierce.edu
5/27/13

(*Cold Ground – This is a tune by a rather obscure group by the name of Rusty Truck which is fronted by Mark Seliger. Mark is better known for his famous photographs of celebrities and musicians including Bob Dylan, the Rolling Stones, Mark Cobain and others. His work has appeared on over 100 Rolling Stone covers. Even though he has been on the other side of the camera lens for most of his career, he clearly has made some friends in the process. On his first album, Broken Promises, he had Sheryl Crow, Jakob Dylan, Willie Nelson and Lenny Kravitz as guests, among others. Enjoy Cold Ground produced by T-Bone Burnett and featuring Sheryl Crow on backup vocals.)

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Burning Ground* - Geothermal Energy in New Hampshire

This week I am going to take a look at geothermal energy - the energy source that lies right beneath our feet. When we discuss geothermal energy we must be aware that there are essentially two forms of geothermal energy.

The first is the type that utilizes the high temperatures of underground rock formations in areas where there is a lot of geologic activity which is often indicated by the presence of hot springs and geysers. Places like Yellowstone immediately spring to mind. In this form of geothermal energy, water is pumped down deep wells, some as deep as 5 miles, to access rocks that have temperatures in excess of 212^oF. The water is heated by the rocks and is drawn back to the surface to produce steam which can be used to drive turbines and generators to produce electricity. The source of energy in these sites comes from the earth's internal heat which is produced from the decay of radioactive elements in the rocks or the heat flow from the earth's mantle where the earth's crust is thinner.

There are a good number of locations where we can access this energy, and as the US geothermal heat flow map below shows, these red colored areas lie largely in the western portion of the US. To generate electricity from geothermal sources, one needs rock temperatures in excess of 212^oF at reasonable depths. Interestingly, on close examination of the geothermal map below, one can see that there is a hotspot in NH located in the White Mountains area. At depths of 6.5 miles, rock temperatures in this area are in excess of 400^oF due to the abnormally high natural radioactivity of the granite in this area. This is a source of energy we might have to tap one day.

Graphic Sources: http://www1.eere.energy.gov/geothermal/pdfs/egs_chapter_2.pdf

The other type of geothermal energy we can access comes from the dirt beneath our feet. In many areas, the temperature of the ground, 4 or more feet below the surface, is a moderate 50 to 55^oF. We can utilize this property of the earth and draw heat from the ground in the winter or use the cooler ground temperatures to dump heat into during the hot summer months. This utilization of the energy in the ground beneath our feet is more correctly termed "geoexchange". Some like to call these arrangements earth exchange or ground source heat pump systems. This form of earth-based energy is very different from the "hot rock" type of geothermal energy as the source of energy in these geoexchange systems actually comes from the sun's warming of the earth surface. So, in essence, these geoexchange systems are indirectly a form of solar energy.

Because the ground temperatures are so low compared to the traditional geothermal systems which utilize the temperatures of hot rocks deep below the earth's surface to produce electricity, these geoexchange units cannot produce electricity. Instead we use the earth as a heat sink – we dump excess heat energy into the earth during the hot summers and we draw heat energy from the ground in the cold winter months to preheat the circulating air or water in our homes. But, and this is important in the understanding of these systems, it takes energy, in the form of electricity, to make these low temperature systems work. The electricity is needed to drive a device called a heat pump.

Most of us are familiar with heat pumps but we don't recognize them as such. The refrigerator in your home is a heat pump. What the refrigeration system is doing is drawing the heat from inside your refrigerator and pumping it into your kitchen. It does this through the compression and expansion of a refrigerant gas which provides the medium whereby heat is drawn out of the refrigerator and pumped into the kitchen. Because this device requires electricity to run the compressor pump and the warm air of the kitchen to work, it is referred to as an air-source heat pump. This is the same principal an air conditioner works on, which is pumping heat from inside the home into the warm outside air. With the geoexchange units we don't pump the energy into the hot summer air outside the home; instead we pump the energy into the cooler ground below our feet, which is why these units are called ground-source heat pumps. The fact that the ground is cooler than air makes these ground source units more efficient than the air-source units in typical air conditioners.

These heat pumps can also work in reverse. They can draw the heat from the air outside the house, or the ground, and pump it inside to warm up your home. You might be thinking that sounds awfully complicated when you can simply heat up the inside of your home with an electrical heater or your natural gas or oil burner. However because you are drawing energy from the moderate temperatures in the earth, you do not need as much energy as you would from an electrical or fossil fuel heater. In fact because you are drawing on the indirect solar energy stored in the earth, these heat pumps require only 25% to 35% of the energy you need to heat your home compared to an electrical heater. The ratio of energy needed to heat a space with an electrical heater to the energy used by a heat pump is termed the Coefficient of Performance, or COP, and is the basis of comparison between different heat pumps. For example, the COP value for a heat pump that requires only 25% of the energy to heat your home compared to an electrical heater is 4, calculated as follows

Coefficient of Performance = Electrical Energy required to heat home
                                               Electrical Energy consumed by heat pump

           = 100%
                25%           
            = 4.

Ground-source heat pumps range in performance with COP values of 2.5 to 4, with typical values in the 3.3 to 3.8 range. It must be noted that these values are highly dependent on proper engineering, the quality and efficiency of the mechanical device as well as the temperatures in the ground.

In geoexchange systems there are two main components, the heat pump and the circulation system that is drawing the heat from the earth. The circulation systems come in several different configurations. The most common, and the one most often used for homes, is the horizontal configuration in which the piping, containing an inert fluid, is buried in a shallow trench 4 to 6 feet deep alongside a home. The piping is made of plastic and is laid at the bottom of a trench in a slinky arrangement as shown in the figure and photo below.
 

These are referred to as closed loop systems as the circulation fluid, similar to antifreeze, is never directly in contact with the ground. Instead it is circulated between the heat pump and the ground through the piping. The heat pump draws the energy out of fluid, cooling it in the process and pumps the heat energy into the house. The cooled fluid is then circulated through the piping buried in the ground where it is heated up again to the ground temperature before returning to the heat pump.
 
Another type of closed loop configuration is a vertical system where the piping is enclosed in wells which penetrate deep into the ground as shown in the figure below. The advantage with these vertical closed loop systems is that, in these deep wells, the piping can come in contact with the ground water and water is a highly efficient medium for transferring the heat from the ground to the circulating fluid. These vertical systems also require a smaller surface footprint than the horizontal equivalents which can be crucial when space is limited or the heating loads are large, such as one might find in a school or apartment building.

A different type of system is the open loop configuration where the circulating fluid is ground water that is drawn from a vertical well and injected back into the ground via another well as shown in the diagram below.

 

There are many variations on these types of open loop systems including a standing-well system where the water is drawn from the bottom of a deep vertical well and is then returned to the top of the same well. With these standing-well systems, there is often a small amount of the circulating water, typically 5 to 10% of the water flow, that is not returned to the well. This bleed stream depletes the water in the well and this encourages the flow of fresh ground water into the well which promotes the maintenance of constant temperatures in the well and circulating water.

Most geoexchange units are, energy plant wise, relatively small scale units and are designed for specifically for individual residences or facilities such as hospitals, office complexes or nursing homes. There are also fair number of vendors of these systems that have been operating for a number of years in NH. As a result, it is difficult to get good reliable data on the total installed base of geothermal energy units in New Hampshire and my best guess is that there are many thousands of these units installed in homes and buildings throughout NH. In fact, some developers are building whole housing complexes and communities that make extensive use of geothermal energy.

In my chats with geoexchange system installers and folks who have these units in their homes, I have learned the following:

• These units are expensive to install and prices for a residential system, including the well, heat pump and circulating system, range from $20,000 to $35,000
• Because the installed costs are so expensive, sometimes the units are under-designed to save on upfront equipment costs. As a result, the systems are undersized and do not work well, particularly when temperatures are colder (or hotter) than usual. In these undersized systems, there can be an enormous draw on electrical backup heating systems which then significantly diminishes the savings.
• For the well-based systems, the choice between a closed loop and an open loop system is a difficult one and can be quite site specific. Each system has its own pros and cons and each has its advocates and detractors
• After installation, the owners either love or hate them. I have heard stories where owners are disappointed that the promised savings did not materialize or where there have been issues associated with the circulating systems or heat pumps. And then there are the owners who are delighted with their units and pleased to share with me that they no longer have fossil fuel bills.

I was interested in determining the financial return for installing a typical geoexchange system into a home with a pre-existing forced air heating/and cooling system so I ran some calculations based on my residence which is a typical New England home. Here are my assumptions

• Home Footprint: 2500 square feet
• Electricity Use: 12,000 kWh/year @$0.13 per kWh
• Oil Consumption for Heating: 800 gallons per year @ $3.75 per gallon.
• COP for Geoexchange System: 3.5
• Installed Cost: $25,000 with 30% federal tax rebate

With this data I determined that my annual savings would be $1800 per year which would yield a 9-year payback which is OK if I intend to stay in the house for more than nine years. However, I decided to do a more sophisticated calculation in which I assumed a 2% annual increase in the costs of electricity and a 4% increase in the cost of oil. On this basis, the payback period drops to 7.5 years and a single one-year long oil price spike would probably push that down to 5 years. Further calculations showed that the calculated rate of return for the project over 20 years is 14% which means I would be ahead of the game if I funded this project by borrowing for anything less than 14% which is pretty easy to do in these low interest days. Certainly food for thought and it looks like an option I might want to consider, however the best time to do so would be when I eventually have to replace my oil burner. In this situation I would be able to incorporate the costs of a new oil burner into the calculations and now the payback period drops to 4 or 5 years which makes a geoexchange system very attractive.
 
In NH we don't have the readily accessible hot rocks and burning ground* type of geothermal energy the folks out West do, but just 4 feet down we can access the solar energy stored in the cool earth. There are lots of opportunities for us to do so and I encourage you to consider a geoexchange unit when you build a new home or you have to replace the natural gas or oil burner in your home. Yes, it is a hefty investment but forward-looking, energy-conscious folks consider a 4 to 5 year payback to be a good return on an energy project.

Next week I will be discussing a large and impressive geoexchange project in NH I have recently visited plus I will share with you some geoexchange cautionary tales. I would be interested in your experiences with geoexchange systems so be sure to share them with us in the comment box below.

Until next week, remember to turn off the lights when you leave the room.
 
Mike Mooiman
Franklin Pierce University
mooimanm@franklinpierce.edu
5/20/13 

(*Burning Ground – A fabulous tune by Van Morrison from his 1997 Album "The Healing Game". One of those driving songs that makes you want to roll down the window, crank up the volume and sing along.)

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This is the Happy House* - Ways to Measure Building Energy Efficiency

(I am travelling in South Africa this week and I have been meeting with some of the large mining companies down here to discuss their sustainability and energy programs. I have learned that our energy challenges in New Hampshire pale in comparison to the issues here on the southern tip of Africa. My time has been tight and so I have invited Laura Richardson, the Director of Operations at The Jordan Institute, to contribute a guest blog this week. - Mike Mooiman)

When you wander the parking lot at the car dealership, dreaming about your next ride, each new car has a Monroney sticker on it explaining the features and details of the vehicle. It's a standardized sticker and it allows you to understand those features at a glance. The largest font is reserved for gas mileage – city and highway, and, interestingly, one of the smallest fonts is the price of the vehicle.

Here's an image of the 2012 Chevrolet Volt's Monroney Sticker.

The sticker was developed by Almer Stillwell "Mike" Monroney, a senator from Oklahoma who sponsored the Automobile Information Disclosure Act of 1958. In the 1970s, the EPA added fuel economy standards to the sticker, and starting this year information about the energy electric vehicles use – kWh, emissions, and other environmental aspects will be added.

 

Regardless of your requirements of a car, we all have a basic understanding of the value of good gas mileage versus bad gas mileage, and the Monroney stickers provides useful information so we can balance those needs pretty quickly. Based on the number of really big SUVs and much more efficient smaller cars I see on Route 93, I think that disclosure tool works well. The gas guzzlers are usually the ones zipping past me, all urgency and comfort, using even more fuel. And so it goes, but at least they knew what they were buying.

 

When we consider buying a building – new or used, residential or commercial – we are usually first interested in the cost, the location, the size and features as well as the appearance. Operational costs sometimes come up in the conversation, but the other factors often outweigh them in immediacy. And rarely do we really know what we bought until those first utility bills arrive. Considering that in New Hampshire 59% of our energy is used in and for buildings, it is a serious shortcoming that we do not give more thought to the annual energy consumption in buildings.

Currently, there is no Monroney-energy sticker for buildings, although there are some very smart people working to develop one. The Multiple Listings Service sheet available through real estate professionals offers many of the details of buildings, and recently the Northern New England Real Estate Network added a box on their MLS sheet for "building certifications." This box often remains blank because most buildings cannot claim certifications. The empty box provides a placeholder to acknowledge above-code certifications such as EnergyStar, HERS, LEED, Green Globes, Passive House, Net Zero, or some other accomplishment. The box's emptiness signifies that the building isn't as optimal as it could be. This placeholder provides a very important first step, and until all buildings have a metric that we can understand at a glance, many building owners are going to be continually surprised at their operational costs. 

 

From a sales perspective this makes perfect sense because most of the building stock leaves a lot to be desired when it comes to energy efficiency. No salesperson seeks to highlight the inadequacies of their product. It takes a much more creative sales approach to acknowledge long-term costs and the burdens they may bring a building owner. The language of real-estate sales can be a bit of a parallel universe, with code words like "great location," "charming," "cozy," and "a handy man's dream" euphemistically telling the real story. 

 

Many commercial buildings are owned by one entity and leased by another in a triple-net lease arrangement, whereby the tenant pays not just rent but also all of the costs of running the building, including the taxes, insurance, maintenance, and utilities. This scenario provides little motivation for the building owner to make energy-related upgrades, because he/she doesn't pay those costs or recoup the savings. The tenant isn't motivated to make improvements either because he/she doesn't own the asset. This "split incentive" also effects residential rental units and leads to the gradual decline of the buildings.

 

Some banks now require HERS Ratings (Home Energy Rating System) before lending on residential Energy Efficient Mortgages (EEMs) or "green mortgages." All ENERGY STAR certified homes must earn a HERS Rating of approximately 85 or lower, depending on a variety of factors such as square footage. Banks that participate in EEM programs may lend at more attractive rates and value certain upgrades that are not included or valued in standard mortgages. These measures can include aggressive airsealing and insulation, more efficient heating or cooling systems, ventilation systems, ENERGY STAR certified appliances, renewable energy systems, and high-performance windows and doors.

The HERS Rating process confirms that energy-efficiency upgrades have been modeled and installed as designed and that energy use will be lower than its baseline comparison; the bank and the owner are confident that the monthly utility bills will be less than a code-built house, thus reducing the risk of default because of operational costs. Therefore the bank can lend a little more money on the building and/or at a better rate, and that additional amount to the mortgage covers the costs of the upgrades.

A HERS Rating of 100 represents the baseline energy code for a new home and 0 denotes net zero energy use. There are a lot of factors and analyses that need to be considered to arrive at a HERS Rating, and for the most part this metric is used for residential construction. The US Department of Energy has determined that a typical resale home scores 130 on the HERS Index. An average 1900s farmhouse would probably get a HERS Rating of 150 to 200, but why would they want to advertise that? A normal 1970s house would probably get about 120. A house built to the 2009 International Energy Conservation Code should get a HERS Rating of 100. This is the building energy code standard we use in New Hampshire. However, energy-code compliance rates in New Hampshire average about 50%, meaning that new construction does not always meet the expected standards.

Most ENERGY STAR homes, which also require the HERS Ratings, in New Hampshire, are in the 60-70 range without renewable energy systems. There are a handful of very high-performing homes in the mid-20s. The figure below provides the HERS scale along with some typical values.

 

England has developed a two-certificate system, one that denotes the modeled expectations of the building and the other that discloses how efficiently the building is being used. This is a really interesting approach. Much like a speed-demon driving a very efficient vehicle, buildings that are operated differently than the energy models anticipate and will thus have different outcomes. As the advertisements remind us, "your results may vary". 
 

But what about existing buildings? What about larger commercial buildings, the real energy hogs out there? For these structures, building science professionals use energy intensity metrics – Energy Use Intensity and Cost Use Intensity, although they are not as visible (yet) as those Monroney stickers.

 

Energy Use Intensity (EUI) is an easy metric to understand: Thousands of BTUs per Square Foot per Year. By collecting energy bills for the entire building – electricity, space heating, hot water heating, process heating, and, if incurred, the costs to dispose of waste heat – for one year and converting all of the energy units into one unit of measure, thousands of British Thermal Units (kBTUs), we can compare electricity and heating loads as well as year-to-year usage. Some buildings use a mix of fuel sources for heat and they have different units of measure – for example, electric (kilowatt hours) for space heating, propane (gallons) for domestic hot water, #2 or #6 fuel oil (gallons) or natural gas (therms) or wood pellets (tons) for heating. By converting all the fuels to one common unit, it is much easier to analyze. In our analysis, we prefer looking at three years of data to get a full grasp of energy use in the building. It is important to also realize that different types of buildings – hospitals, schools, apartment buildings, retail stores and warehouses all have different energy profiles and should therefore not be compared to buildings in general but rather to buildings of similar type.

To better explain this we will use, as an example, a mixed-use retail and apartment building, 32,635 square feet in size, heated with oil. The following chart is an analysis completed prior to making energy-efficiency upgrades. While a lot of us focus on our electricity rates, in fact in New Hampshire we rarely use electricity for heat, but rather use a tremendous amount of fossil fuels, as shown in the consumption chart below. 

Let's be honest, though, only a few of us really care about energy waste because it is waste, most of us care about the associated costs, and this is where it gets very interesting. Cost Use Intensity (CUI) uses the same utility bills, but instead of energy metrics, we analyze the dollars spent on energy. The metric here is Dollars per Square Foot per Year. The chart below shows this data broken out monthly, to better understand how the seasonal changes effect energy consumption.

This is when the dynamics of fuel costs enter the conversation. These days, a building heated with oil costs ~4 times more per BTU than one heated with natural gas or about double the cost of wood pellets. These factors lead to important fuel switching decisions. For example, the long-range forecasts on wood pellets – not to mention the other positive attributes of local and renewable fuels compared to fossil fuels – are relatively stable and supply is available. Switching to wood pellets will therefore dramatically reduce the costs for heating.

 

EUI and CUI information can be compared to data on similar building types. It is important to understand, however, that this baseline comparison work is relative to existing buildings. Did I mention yet that our existing building stock is very inefficient? Ergo, a decent result through a benchmarking exercise might be a winner in a slow race of poorly performing buildings.

Such benchmarking can be quite motivational for building owners who are considering Deep Energy Retrofits (DERs), comprehensive projects that will significantly drop the energy use in the building, improving costs, comfort, and occupancy. Often times, when building owners realize how much worse their buildings perform compared to otherwise similar buildings, a competitive side of them surfaces and they want to undertake a DER project.

 

A DER project typically seeks to reduce energy use by 50%, and it can happen in phases over a number of years. This is most easily achieved in the poorest performing buildings because as buildings improve, the cost to make such percentage reductions gets harder, a la diminishing returns. Typically, a DER will include a package of comprehensive measures such as airsealing and insulation, HVAC and distribution system upgrades, controls, lighting, perhaps windows or door, and renewable energy systems, such as solar hot water and/or wood pellet heating. This example building underwent all of these upgrades. Operator training to run the new and more sophisticated systems is key to success. Moreover, it is critical to monitor and verify that the systems perform as designed and installed – and working together! – and that on-going commissioning ensures that the systems continue to operate smoothly.

In the example shown below, the building started out with an EUI of 89.18 and after the DER it dropped to 30.2. The CUI value dropped from $2.64 to $1.40/square foot.

An interesting metric being used by building scientists to compare the energy performance of buildings across regions incorporates Heating Degree Days into this calculation. This normalizes the energy numbers in a way so we can compare the heating use in a New Hampshire building with one in a very different climate location. This step is helpful in comparing buildings across regions and climate zones., (Electricity and Cooling Degree Days are often similarly considered in warmer climates.)

The metric is : BTU / Square Foot / Heating Degree Day. 

 

Using the example above, this metric would create a single number – yippee! – that could be used on buildings across the country to demonstrate their energy performance and it could in time become as effective as a Monroney sticker on a car. This particular building started out at a value of 13.5 and and after a deep energy retrofit now celebrates a value of 6.0. This is very exciting and demonstrates what can be accomplished in reducing the energy efficiency of our building stock.

 

These building energy efficiency measures are growing in popularity as they allow us to determine operating costs for buildings, benchmark existing and new buildings as well as measure the outcomes of energy savings projects. Energy is all about the numbers and these are good metrics that allow us to measure our progress and perhaps one day they will be as prevalent as the Monroney stickers on new cars. 

Laura Richardson
5/14/13

 

Laura Richardson is Director of Operations at The Jordan Institute in Concord, NH. The Jordan Institute, an energy think tank, mission-driven to find solutions to climate change, helps commercial building owners significantly reduce the energy used in their buildings. She managed nine energy programs funded by the stimulus for the NH Office of Energy and Planning, coordinated the StayWarmNH initiative, and co-founded the NH Sustainable Energy Association in 2003. She and her husband have lived off the grid since 2001 in a PV-powered, passive-solar and cordwood/TARM heated home. The home earned a 54 HERS Rating. Her Toyota Prius has 288,000 miles on it and still gets between 45-50mpg.

 

(*One of her all-time favorite bands is Siouxsie and the Banshees. *"Happy House" is a great tune, full of irony and cynicism about how wonderful we pretend things are when really they are a mess. Sort of like our building stock. Enjoy Happy House!)

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