| Introduction: Energy Savings Tracking Methods | | | | sometimes leading to mistrust. Energy savings |
| After installing energy conservation measures | | | | calculations should remain as simple as possible and |
| (ECMs), Energy Service Companies (ESCOs) often | | | | explained in a manner that the customer can |
| determine the energy savings resulting from the | | | | understand. This makes the customer's job |
| project and present the savings results to their | | | | easier, and reassures the customer that the |
| customers. A common way to calculate energy | | | | energy service company is acting in a truthful |
| savings is to measure the flows of energy | | | | manner. |
| associated with the ECM, and then to apply | | | | For these reason, more and more customers ask |
| spreadsheet calculations to determine savings. | | | | for Measurement and Verification using utility bills. |
| For example, a chiller retrofit would might require | | | | |
| measurements of chilled water supply and return | | | | Difficult and Interactive Energy Conservation |
| temperatures and kW. The benefit of this | | | | Measures |
| approach is that the ECM is isolated, and that only | | | | For many energy conservation measures, Retrofit |
| energy flows associated with the ECM itself are | | | | Isolation is the best option. This would include |
| considered. | | | | lighting savings, savings from energy efficient |
| This method is described as Option A or Option B | | | | motors, and from other non-weather dependent |
| in the International Performance Measurement and | | | | energy users. |
| Verification Protocol (IPMVP). Table 1 presents | | | | However it is very difficult or impossible to |
| the different options. Option A requires some | | | | measure savings for some energy conservation |
| measurement and allows for estimations of some | | | | measures. Still, some ESCOs insist on using |
| parameters. Option B requires measurement of | | | | Retrofit Isolation for these difficult measures. |
| all parameters. In both options, calculations are | | | | For example, engineering calculations can be made |
| done (typically in spreadsheets) to determine | | | | estimating the savings to be had by shutting |
| what energy savings. Option C uses utility bills to | | | | down air handlers at night. But, assuming that |
| determine energy savings. | | | | the air handlers receive chilled water from a chilled |
| Some ESCOs Have Limited Options | | | | water loop shared with other air handlers, how is |
| There are many situations where Option A or | | | | one to measure energy savings? Fan savings |
| Option B (Metering and Calculating) is the best | | | | are easy (assuming the unit is constant volume), |
| approach to measuring energy savings, however, | | | | but in order to calculate savings, several |
| some ESCOs insist upon only using Option A or | | | | estimations need to be made, which result in an |
| Option B, when clearly Option C would be most | | | | estimate of energy savings, just as accurate |
| appropriate. If the ESCO was a lighting | | | | before the retrofit took place as after it took |
| contractor, then Option A should work in all | | | | place. Suppose the unit is a VAV system, at |
| cases. Spot measurements of fixtures before | | | | what percentage would the fan have been |
| and after, agreed upon hours of operation, and | | | | running? Suppose the cooling coil and/or heating |
| simple calculations can be inserted into a | | | | coil modulated to meet a changing supply air set |
| spreadsheet that can calculate savings. The | | | | point - how are the fan CFM, cooling and heating |
| same spreadsheet can be used over and over. | | | | loads to be calculated if the unit is not running and |
| However, for ESCOs that offer a variety of | | | | measurements can not be made? |
| different retrofits, it is necessary to be able to | | | | Controls retrofits are difficult to measure and |
| employ all options so that the best option can be | | | | quantify directly. Usually, however, when a |
| selected for each individual job. Controls | | | | controls or commissioning measure is enacted, |
| Retrofits, or retrofits to HVAC systems are | | | | more than one item is adjusted, which further |
| typically excellent candidates for Option C. | | | | complicates an already difficult task. Suppose a |
| However there are drawbacks with metering and | | | | partially working economizer was fixed, in addition |
| calculating savings and these can include: | | | | to putting the fan on a variable speed drive, in |
| - Greater expense | | | | addition to shutting off the air handler during |
| - Difficulties convincing the customer of the | | | | unoccupied hours, and finally upgrading the chiller |
| appropriateness and veracity of the method and | | | | plant. Each of these measures would interfere |
| savings numbers | | | | with the savings calculations of the other. How |
| - Inability to handle interactive or many | | | | can one calculate chiller savings, when the loads |
| difficult ECMs. | | | | have changed so dramatically via the economizer, |
| ESCOs that do not have the capacity to employ | | | | reduced hours and reduced air flow? This is a |
| all options are at a disadvantage over those | | | | very difficult task, that most likely cannot be |
| ESCOs that can employ them all. Specifically, we | | | | done with an acceptable degree of certainty. |
| want to address those ESCOs that only employ | | | | Complicated cases like this require utility bill |
| Option A and Option B. These ESCOs may | | | | analysis to measure and quantify savings. The |
| encounter the following problems due to their | | | | procedure is very simple, inexpensive, and easy |
| limited offerings: | | | | to explain relative to many Retrofit Isolation |
| - Measurement and Verification costs can be | | | | methods. |
| greater, which lead to higher project costs, which | | | | Benefits of Utility Bill Analysis |
| can limit the energy projects that the ESCO can | | | | The benefits of utility bill analysis to calculate |
| sell. The lack of Measurement and Verification | | | | energy project savings are as follows: |
| options overall can make the ESCO less | | | | - Utility Bill Analysis, by its nature, is relatively |
| competitive, and hurt the financial performance of | | | | simple, and does not require complicated |
| the ESCO. | | | | engineering analysis. |
| - Using Options A or B sometimes require | | | | - Utility Bill Analysis is relatively inexpensive, |
| the customer to understand and approve of | | | | as it requires less skilled workers, less time and no |
| complex energy calculations. These options are | | | | dedicated equipment. |
| often difficult to explain to customers who insist | | | | - Utility Bill Analysis provides savings numbers |
| upon seeing savings in their utility bills. Customer | | | | in a format and method that makes sense to the |
| satisfaction can suffer if Option C is not made | | | | customer. |
| available to customers who want to see savings | | | | - Utility Bill Analysis is the best method to |
| on their bills. | | | | handle complicated energy conservation projects, |
| - Options A and B cannot handle difficult | | | | or projects which interact with each other, |
| ECMs. The methods used to determine savings | | | | making assessment of individual measures |
| are inaccurate, and make large assumptions that | | | | impossible. |
| cannot be borne out if a third party consultant is | | | | - ESCOs can use the fact that energy |
| hired to oversee the savings determination | | | | savings is determined using the customers' utility |
| process. | | | | bills as a selling point. |
| These issues are discussed in more detail below. | | | | Utility Bill Analysis and Changes in Weather |
| Cost of Utility Bill Analysis vs. Metering and | | | | Unfortunately, a simple comparison of pre-retrofit |
| Calculating | | | | and post-retrofit utility bills is usually not an |
| Measurement and Verification should cost | | | | effective method to determine energy savings |
| between 1% and 15% of the project cost. | | | | from ECMs. Weather varies from year to year, |
| Metering and calculating savings often has costs | | | | and affects the amount of heating or cooling |
| associated with labor and equipment. As many | | | | energy usage, which can interfere with actual |
| project configurations are different, projects | | | | utility savings numbers. For a fair analysis, utility |
| typically require unique configurations of sensors, | | | | bills should be "corrected" for weather data, which |
| placements of sensors and savings calculations. | | | | results in a reasonable savings determination. |
| On more complicated ECMs, only highly skilled | | | | Linear regression is applied to utility usage versus |
| energy professionals can determine which | | | | degree days to determine pre-retrofit utility usage |
| measurement devices should be applied, and to | | | | patterns, which are then compared to |
| what components. Manipulating data, and finally | | | | post-retrofit utility usage to determine savings. |
| creating spreadsheets with engineering calculations | | | | Unfortunately, the scope of this paper is limited, |
| also requires skilled personnel who command high | | | | and cannot present the method in detail. |
| wages. Metering equipment also has a cost, and | | | | Weather-correcting for weather is easy, |
| for many projects, metering equipment, or | | | | however, as specialized software, used by ESCOs |
| control points, have to be purchased, and remain | | | | around the world, simplifies the weather |
| on the job for years. | | | | correction process and presents savings reports. |
| Of course, there are cases where metering and | | | | Drawbacks of Utility Bill Analysis |
| calculating is the least expensive and the most | | | | Facilities may change their energy usage patterns, |
| desirable method. If an ESCO only provides a | | | | by installing more equipment, building additions, |
| lighting retrofit, then measuring a selection of | | | | occupancy changes, etc. This upsets the existing |
| lighting fixtures before and after the retrofit, and | | | | utility bill comparison of pre-retrofit to post-retrofit |
| producing a spreadsheet that determines savings | | | | usage. These changes need to be monitored |
| is the best option. | | | | and accounted for with Baseline Modifications. |
| On the other hand, utility bill analysis is | | | | There is a certain amount of randomness in utility |
| inexpensive. With specialized utility bill analysis | | | | bill comparison. So many factors influence the |
| software, clerical workers can create the | | | | amount of energy usage in any given month, and |
| Measurement and Verification analysis. Bills are | | | | they cannot all be accounted for. As a result, if |
| entered, weather imported, a linear regression | | | | you are trying to show savings that is less than |
| performed, and reports made. Capital need not | | | | 10% of the total electricity load, then the |
| be sunk into metering equipment or control points | | | | randomness in the bills may seriously interfere |
| or into long hours of analysis and data | | | | with the accuracy of your savings calculations. |
| manipulation. Typically for utility bill analysis, | | | | If you track savings by comparing utility bills, you |
| measurement and verification costs are a fraction | | | | will only be able to track total savings for a given |
| of what costs for retrofit isolation savings are - | | | | meter, but you will not be able to separate out |
| ranging between 1 and 5% of project costs. | | | | the savings for different Energy Conservation |
| Explaining Savings Numbers to Customers | | | | Measures (ECMs). For example, if you installed a |
| Customers understand utility bills. The reason | | | | lighting retrofit, an energy efficient chiller and a |
| they entered into an energy savings contract is | | | | control system in a hospital, you will not be able |
| often triggered by the desire to lower their | | | | to tell how much energy is being saved by the |
| energy bills. Retrofit Isolation methods do not | | | | control system. Energy analysts try to do break |
| address the customer's utility bill. A project may | | | | out the savings for each ECM occasionally, but |
| be saving energy, but the utility bill may actually | | | | they are only making educated guesses. |
| be increasing. Retrofit Isolation does not address | | | | Conclusion |
| this at all. ESCOs need to be responsive to | | | | When an ESCO approaches a performance |
| customer's needs, and this is done through | | | | contract, there are several measurement and |
| communicating in a manner that the customer's | | | | verification options available. Those ESCOs that |
| understand. They want to see the savings on | | | | only have at their disposal a limited set of options |
| their utility bills - this is a method they would trust. | | | | are often spending too much money on |
| | | | | measurement and verification, and therefore are |
| In addition, customers are sometimes mistrustful | | | | held back from selling larger projects, and limit |
| of energy service companies that provide savings | | | | their own success. |
| numbers that the customer cannot understand. | | | | Customer satisfaction may suffer when ESCOs |
| Although the calculations in the spreadsheet may | | | | only offer Retrofit Isolation approaches to |
| appear perfectly reasonable to the energy | | | | Measurement and Verification, as customers may |
| analyst, to a customer who is not well-versed in | | | | want to see savings in their utility bills. ESCOs |
| math, the calculations may remain | | | | who refuse to speak in the same language or |
| incomprehensible, and the customer is thereby | | | | terms as the customer may suffer decreased |
| required to trust the energy service company, | | | | customer satisfaction. |