Transcript What’s New in Program Year 3?

Why Energy Efficiency?
Steve Baab, Manager Business Programs
June 22nd, 2010
ComEd Profile
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Energy delivery company
3.8 Million Customers
11,400-square-mile territory
Northern 1/3 of Illinois including
Chicago Metro Area
• 90,000 miles of power lines
Agenda
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Overview of Energy Efficiency
Smart Ideas for Your Business
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Types of Projects
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Barriers / Benefits of Energy Efficiency
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How to get started
Overview
National Energy Efficiency Potential
• McKinsey & Company Study-Unlocking Energy
Efficiency in the U.S. Economy*
– A $520 Billion investment in efficiency measures would yield $1.2 trillion
in gross energy savings by 2020
• Lawrence Berkeley National Lab-U.S. Building-Sector
Energy Efficiency Potential*
– 1/3 of Business as usual electric consumption can be saved at a cost of
$02.7/kWh
– 2.5 year simple payback
– Savings at 3.5 times larger than the investment required
*McKinsey & Company. Unlocking Energy Efficiency in the U.S. Economy. July 2009
http://www.mckinsey.com/mgi/publications/Curbing_Global_Energy/executive_summary.asp
*U.S Building Sector Energy Efficiency Potential. Lawrence Berkeley National Laboratory. University of California. Berkeley, California 94720U.S.
http://enduse.lbl.gov/info/LBNL-1096E.pdf
For the Environmental Protection Agency, Climate Protection Partnerships Division, Office of Air and Radiation, under U.S. Department of Energy
Contract No. DE-AC02-05CH11231.
Overview
Ratepayer energy efficiency programs continue to
expand throughout the States, adding funds annually.
Source: The 2008 State Energy Efficiency Scorecard - ACEEE
Smart Ideas for Your Business
Smart Ideas
What is the Smart Ideas Program?
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Provides incentives for energy
efficiency upgrades and
Smart Ideas for Your Business
equipment
Energy Efficiency Goal (MWh)
Part of Illinois energy legislation
passed in 2007
1,000,000
Program implemented by ComEd,
800,000
Ameren Illinois, and the Illinois
600,000
Department of Commerce and
Economic Opportunity
400,000
ComEd Goal: Reduce energy
200,000
consumption by 1.2 million MWh
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(over 3 years)
2008 2009 2010 2011* 2012* 2013*
* Estimated based on planning projections
Smart Ideas
Funding for Energy Efficiency as a Percent of Utility
Revenues
Source: American Council for an Energy-Efficient Economy, September 2007
Smart Ideas
ComEd and DCEO manage different portions of the energy efficiency
portfolio
– Funding Split: 75% for ComEd programs and 25% for DCEO programs.
– Sector Split: ComEd – Private Sector; DCEO- Public Sector and LowIncome.
Business
Solutions
Residential
Solutions
ComEd
Public and LowIncome Solutions
DCEO
Smart Ideas
What Does Smart Ideas Include?
Incentives
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Prescriptive
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Custom
Retro-commissioning (Low Cost / Operational)
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Commercial Building
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Compressed Air
New Construction
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Retro-commissioning
Data Services
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Energy Insights Online
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ENERGYSTAR benchmarking
Ineligible Measures
Fuel switching
Solar / Wind projects
(other incentives available)
Residential applications
(other incentives available)
Onsite Generation
Peak Shifting
Smart Ideas
Prescriptive and Custom Incentives
• Incentives for popular prescriptive projects:
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Exit signs
T5/T8 fixture with ballast
Occupancy sensor lighting
Motors
$20 per sign
30¢ per watt reduced
9¢ per connected watt controlled
$7 for 1 HP to $450 for 200 HP
• Incentives for custom projects: 3-7¢ per kWh saved
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Motors larger than 200 HP
VFDs on process motors
New compressed air systems, compressed air sequencing
Combine process chilled water systems
Free-cooling for process chilled water
Ground-loop heat pump for process cooling
Smart Ideas
Think about Motors and Drives
• Over half of the electric energy consumed in the US is used by
electric motors.
• Electric motors systems account for almost 70% of manufacturing
sector electricity consumption.
• A heavily-used motor may cost six to ten times its purchase price to
operate per year.
• NEMA Premium-efficiency motors operate at 1% to 4% higher
efficiency than EPACT motors
• NEMA Premium becomes the federal standard Dec. 19th, 2010
Smart Ideas
Consider Retro-Commissioning for Compressed Air
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Two system-size tracks
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Low- and no-cost measures – detailed
analysis
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500 HP and larger – traditional retrocommissioning
100-499 HP
• Rebate-based approach to study and
implementation
• Begins in June
Controls optimization
• Scheduling
• Sequencing
End-use analysis
Leak identification
Capital improvements – opportunity
identification
Visit www.comed.com/bizincentives
Types of Projects
Types of Projects
Who Is Implementing Energy Efficiency Projects?
Retail/Service 24%
School/College 2%
Restaurant 2%
Heavy Industry 7%
Office 14%
Grocery 7%
Other 10%
Warehouse 10%
Medical 4%
Light Industry 19%
Hotel / Motel 2%
Types of Projects
Types of Energy Efficiency Projects
Lighting, 83%
VSDs, 5%
Refrigeration, 3%
Motors, 1%
Other , 2%
HVAC, 4%
Compressed Air,
1%
Energy Mgmt
System, 2%
Types of Projects
Armacell LLC
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Combined two distinct process chilled
water systems
Added heat exhanger
Reduced number of pumps
Added controls and VFDs
1,596,269 kWh projected annual energy
savings
$248,523 total project cost
$100,000 Smart Ideas incentive
Payback 1.7 years with incentive
Visit www.comed.com/bizincentives
Types of Projects
Conrad Hotel
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311-guestroom luxury hotel
HVAC
Total project cost: $136,942
Projected annual energy savings:
465,138 kWh
Incentives paid: $32,560
Payback period without incentive:
About 3 years
Payback period with incentive: 18
months
Types of Projects
Chicago History Museum
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Building size: 235,000 square feet
Measures implemented: Retrocommissioning
Incentives paid: $89,436
Annual energy savings: 491,754 kWh
Annual energy cost savings: $40,200
Total project cost: $11,400
Payback period Less than 4 months
Barriers to Energy Efficiency
Barriers
What Holds Customers Back
• Availability of capital
– Cost of capital
– First cost
– Credit and collateral
issues
• Payback/ROI requirements
– Payback period of less
than three years typical
Availability of Capital
Payback Requirements
All Other Barriers
Benefits of Energy Efficiency
Benefits
Energy Efficiency’s Triple Bottom Line
Environment
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“Going Green” image boost
Energy performance
People
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Saving jobs
Creating jobs
Building environment
Stewardship
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Corporate sustainability initiatives
LEED initiatives, both retrofit and
new
Comfort
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Space conditioning
Quality of work environment
Dollars
Savings
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Financial performance
Capital expenditures
Process improvements
Deferred maintenance
Types of Projects
Average ComEd Project
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Changing 400 watt MH lighting
to linear fluorescent (6LT8HO)
Changing 100 fixtures
Total project cost (ComEd
project data) = $1.10 per watt
reduced or $26,070
Incentive = $7,110
Energy Savings is $11,376 per
year
Payback is 20 months with
incentive (27.5 without)
Benefits
Project Economics Over Time *
100,000.00
80,000.00
Replace lamps
Most people
focus on the
payback…
60,000.00
40,000.00
…and ignore
the potential
long term savings!
20,000.00
0.00
-20,000.00
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
* Fixtures last over 10 years, while lamps need to be replaced after 5 years
Year 9
Year 10
Benefits
A Look at the Numbers: (The red area)
• Lighting system upgrade:
Less Smart Ideas incentive:
Net investment:
$26,070
( 7,110)
$18,960
• Monthly electric bill:
Savings achieved by upgrade:
Net electricity bill with upgrade:
$10,000
( 948)
$ 9,052
• Return on investment analysis:
$948 x 20 months of savings:
$948 x 20 monthly payments:
$18,960
$18,960
Net costs over investment period:
$
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Benefits
How the Savings Continue (The green area)
• At a measure life of five years*, the monthly utility bill savings that
continue from month 21 to month 60 represent an additional
$37,920
$948 savings x 40 months = $37,920
Assuming 4,800 hours/annually
4800/year x 5 years = 24000 hours (average life for a 4-ft T8 lamp)
• A $18,960 investment made today pays for itself from savings in 20
months and yields an additional $37,920 in savings over the next 40
months.
* Lamps would likely need replacing after five years
Benefits
The Results
• The customer gets a new lighting system with better
performance and lower maintenance costs.
• The $37,920 represents pure profit for the customer.
• How many “widgets” would they have to sell to achieve
$37,920 in profit?
• Profit is realized from making the right decision about
energy efficiency without having to make or sell any
more product!
How to Get Started
Getting Started
Where to Start
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Engage an energy specialist that will visit your business, conduct an
assessment and provide a complete proposal showing return on investment
and savings potential
Contact your ComEd Account Manager
Contact your trade ally or consultant
Think about “high hours of use” processes that may mean additional,
significant kilowatt reduction opportunities.
Are you tracking energy-savings opportunities or measures you already
completed at your facility?
Getting Started
Smart Ideas Trade Allies
• What are Smart Ideas Trade Allies?
– Contractors, engineers, energy service companies (ESCOs), or equipment
vendors that sell and install energy efficient technology measures and have
successfully completed training for program participation.
• Why work with a Smart Ideas Trade Ally?
– Familiar with the process and forms
– Committed to energy efficiency
• Find Trade Allies at www.comed.com/tradeallydirectory
Getting Started
Technology Fact Sheets
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How to Apply
Compressed Air
Motors and Drives
HVAC
Food Service
Lighting
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LED Lighting
Outdoor
Calculating Savings
Refrigeration
Retro-commissioning
Project suggestions
Visit
www.comed.com/bizincentives
Getting Started
For Answers to Your Questions
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[email protected]
Program questions (888) 806-2273
Fax: 1-630-480-3436
www.ComEd.com/bizincentives
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Program information
Application forms
Policy and Procedures Manual
DCEO information
• www.illinoisenergy.org
Questions