Transcript Slide 1
Overview of the Non-Domestic Fan Product Profile Ian McNicol, Sustainability Victoria On behalf of the E3 Committee A joint initiative of Australian, State and Territory and New Zealand Governments. What we’ll cover 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. The Problem Scope of the Profile Energy Use and Greenhouse Emissions Size of the Installed Fan Stock Size of the New Zealand Fan Market Fan Types and Potential for Improvements Market Failures and Barriers Approaches to Improving Efficiency Potential Impact of MEPS for Non-Domestic Fans Recommendations 1. Summary of ‘The Problem’ • Estimated 208,000 million fans installed in the industrial and commercial sectors in New Zealand • In 2010 used around 2,445 GWh of electricity, and produced 452 kt CO2-e of greenhouse gas emissions • Represents around 10.3% of the total final electricity consumed in these sectors • By 2030, the electricity consumption is expected to grow to around 3,266 GWh, resulting in 604 Kt CO2-e of greenhouse gas emissions • Previous studies suggest that motor systems and building ventilation fans represent a significant opportunity for negative cost carbon abatement • A range of market failures and barriers exist which hinder the uptake of higher efficiency fan technology in the industrial and commercial sectors 2. Scope of the Non-Domestic Fan Profile • Focus of the Profile is “Non-Domestic” fans – although if any regulations were introduced these could pick up some larger fans used in residential applications • Technical boundary – Fan System – (motor+fan) + controls + ductwork – Fan-Unit – (motor+fan) – Fan – fan only (bare shaft fan) Impact of the Technical Boundary Total Ventilation System Large Savings Fan-Unit Good Savings Fan only Motor + Fan + VSD Small Savings Key Focus of Product Profile • Scope has been limited to non-domestic centrifugal and axial fans driven by electric motors within a 125 W – 500 kW power range – fans with motor input < 125 W are more likely to be used in residential applications – the few fans with motor input power > 500 kW are likely to be custom built and due to their large power consumption are likely to already take energy efficiency into consideration – This scope mirrors the power range of the fans included in the EU’s Energy Using Product Directive study 3. Energy Use and Greenhouse Emissions • High level “top down” estimate of energy and greenhouse emissions from fans is based on: – EU and NZ estimates of % energy use by fans in different industrial and commercial sectors – Agriculture and power generation not included in estimate – NZ data on current and projected future electricity consumption in different sectors Key Sources Used for Estimates Publication Data used in the model New Zealand Energy Data File 2011 Energy consumption by industry sector for 2005 to 2010 Electricity tariffs 2005 to 2010 New Zealand’s Energy Outlook 2010: Reference Scenario Projections of sector specific energy consumption growth to 2030 Projected growth rates in electricity prices Improving the Penetration of EnergyEfficient Motors and Drives (EU study) Proportion of energy usage attributable to fans for manufacturing, mining commercial and water services Distribution of energy consumption by motor size for each sector Estimated Fan Energy Use by Sector Industry Sector All industry Proportion of Sector Final Electricity Consumption 2010 Fan System Electricity Consumption (GWh) 2030 Fan System Electricity Consumption (GWh) 10.3% 2,445 3,266 Mining 4.7% 24 31 Commercial and water services 9.2% 828 1,198 Manufacturing 11.2% 1,593 2,037 Food, beverages and tobacco 10.3% 224 286 Wood, paper and printing 16.3% 535 685 Basic chemicals and Other chemicals, rubber and plastic 7.6% 51 65 Non-metallic mineral products 19.4% 52 67 Basic metals 9.3% 627 801 Machinery and equipment 10.1% 40 52 Other manufacturing 9.4% 64 82 Manufacturing derived from: Mining Manufacturing Commercial and Water 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 30 29 28 27 26 25 24 23 22 21 20 19 18 17 16 15 14 13 12 11 10 09 08 07 06 05 Energy Consumption (GWh/Yr) Projected Growth of Fan Energy Use by Sector 3,500 3,000 2,500 2,000 1,500 1,000 500 - Projected Greenhouse Emissions from Fans 700 Greenhouse Emissions (kT/Yr) 600 500 400 300 200 100 0 05 06 007 008 009 010 011 012 013 014 015 016 017 018 019 020 021 022 023 024 025 026 027 028 029 030 20 20 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 4. Estimated Installed Stock of Fans • Size of installed stock has been estimated by: – Estimating total energy use of fans in different sectors over the modelling period – Using EU and US studies which provide data for different sub-sectors on: • distribution of fan energy use by motor size • number of fans per GWh of electricity consumed for each motor size Example of Fan Data – Food & Beverage Sector Drive size (kW) Proportion of fan system electricity usage Number of fans per GWh of electricity consumed < 0.75 kW 3.1% 933 0.75 - 4 kW 16.4% 127 4 - 10 kW 12.2% 77 10 - 30 kW 8.8% 19 30 - 70 kW 34.4% 5 70 - 130 kW 5.0% 3 130 - 500 kW 20.1% 1 > 500 kW 0.00% N/A Issues with Estimating Fan Stock • Estimated size of the fan stock is important, as it helps us build a “stock model” – Enables forward projection of annual sales (stock increase + retirements) – Enables estimates of savings and cost-benefit from measures such as MEPS to be made Estimated Fan Stock in 2010 Industry Sector All industry Estimate based on KEMA data Estimate based on EU fan stock (All fans) 157,183 208,876 690 477 Commercial and services 128,824 169,311 Manufacturing 27,669 39,088 Food, beverages and tobacco 10,229 14,048 Wood, paper and printing 9,637 10,267 Basic chemicals and Other chemicals, rubber and plastic 320 386 Non-metallic mineral products 973 1,259 4,173 8,436 855 2,784 1,482 1,908 Mining Manufacturing derived from: Iron and steel and Basic non-ferrous metals Machinery and equipment Other manufacturing Estimated Breakdown by Motor Input Power 8,054 (3%) 28,848 (11%) 2,739 (1.1%) 963 (0.4%) 174,298 (69%) 350 (0.1%) 85% < 4 kW 66 (0.0%) 96% < 10 kW 41,928 (16.3%) < 0.75 kW 0.75 - 4 kW 4 - 10 kW 10 - 30 kW 30 - 70 kW 70 - 130 kW 130 - 500 kW > 500 kW 5. Size of the New Zealand Market • Only limited data is available from SNZ on fan imports, exports and manufacture Harmonised Tariff Item Statistical Classification Description 8414590900 Fans not elsewhere classified (“nec”) 8414600001 Hoods; ventilating or recycling hoods incorporating a fan, whether or not fitted with filters, having a maximum horizontal side not exceeding 120cm Fan Imports to New Zealand by Value $45 $40 Value for Duty ($M) $35 $30 $25 $20 $15 $10 $5 $0 2000 2001 2002 2003 Fans n.e.c. 2004 2005 2006 2007 2008 2009 Ventilating or recycling hoods incorporating a fan Av. Imports of “Fans nes” = $27.5 M pa 2010 Source of Fan Imports to New Zealand $35 $30 Value for Duty ($M) $25 $20 $15 $10 $5 $0 2000 2001 2002 North America 2003 European Union 2004 2005 Asia (less China) 2006 China Australia 2007 2008 South America 2009 Africa Other 2010 Changing Source of Fan Imports South America 0.0% Africa 0.0% Africa 0.0% Other 1.8% North America 16.6% Australia 19.2% Other 6.5% North America 14.6% South America 0.1% Australia 21.8% China 2.2% European Union 32.9% European Union 39.7% China 13.3% Asia (less China) 20.6% Asia (less China) 10.8% 2000 2010 Fan Exports from New Zealand by Value $25 Value (FoB) ($M) $20 $15 $10 $5 $0 2000 2001 2002 2003 Fans n.e.c. 2004 2005 2006 2007 2008 Ventilating or recycling hoods incorporating a fan 2009 2010 6. Fan Types & Potential for Improvement FANS Centrifugal No Casing Backward curved Axial Casing Roof Mounted Within air handling unit (HVAC) Wall Mounted Forward curved, Backward curved, Backwards curved, scroll casing scroll housing box casing • Range of different fan types on the market • Most ‘Non-Domestic’ Fans driven by three-phase electric motors which are regulated for MEPS Breakdown of Market into Fan Types • No data currently available on breakdown of NZ market into different fan types • Have assumed that breakdown is similar to the EU market Fan type Market Share 1. Wall mounted axial fan, static pressure <= 300Pa 8.2% 2. Wall mounted axial fan, static pressure > 300Pa 22.8% 3. Centrifugal, forward curved with casing 12.5% 4. Centrifugal backward curved without casing 3.9% 5. Centrifugal backward curved with casing 4.3% 6. Centrifugal backwards curved box fan 17.5% 7. Axial roof fan 30.8% Fan Power and Efficiency • Fan power is proportional to the air flow rate x total pressure against which the fan is operating • Fan performance is characterised by a curve which shows the relationship between the developed pressure and the airflow rate and power • “best efficiency point” (BEP) is the point on the performance curve where the fan energy efficiency is highest Efficiency Characteristics of Average Fan-Unit Fan type Overall average static efficiency of fan unit Average electrical power input (kW) 1. Wall mounted axial fan, static pressure <= 300Pa 30% 0.8 Direct drive 2. Wall mounted axial fan, static pressure > 300Pa 38% 1.3 Direct drive 3. Centrifugal, forward curved with casing 30% 0.44 Direct drive 4. Centrifugal backward curved without casing 50% 3.76 Direct drive 5. Centrifugal backward curved with casing 60% 3.82 Belt drive 6. Centrifugal backwards curved box fan 30% 0.37 Direct drive 7. Axial roof fan 40% 1.2 Direct drive Based on EU data Transmission Derived Average Efficiency of Fan Alone Fan type Av. Fan-Unit Efficiency Av. Motor efficiency Transmission efficiency Derived fan efficiency 1. Wall mounted axial fan, static pressure <= 300Pa 30% 80.3% 100% 37.3% 2. Wall mounted axial fan, static pressure > 300Pa 38% 81.7% 100% 46.5% 3. Centrifugal, forward curved with casing 30% 71.8% 100% 41.8% 4. Centrifugal backward curved without casing 50% 84.8% 100% 59.0% 5. Centrifugal backward curved with casing 60% 84.9% 95.5% 74.0% 6. Centrifugal backwards curved box fan 30% 69.3% 100% 43.3% 7. Axial roof fan 40% 81.5% 100% 49.1% Based on EU data Energy Saving Potential Fan type Av. Static efficiency Efficiency range Max fan unit efficiency Energy saving if Av Eff Fan Replaced by Max Eff Fan 1. Wall mounted axial fan, static pressure <= 300Pa 30% 20% 40% 25% 2. Wall mounted axial fan, static pressure > 300Pa 38% 15% 45.5% 16.5% 3. Centrifugal, forward curved with casing 30% 15% 37.5% 20% 4. Centrifugal backward curved without casing 50% 13% 56.5% 12.5% 5. Centrifugal backward curved with casing 60% 10% 65% 7.7% 6. Centrifugal backwards curved box fan 30% 20% 40% 25% 40% 25% 52.5% 23.9% 7. Axial roof fan Based on EU data Improvements to Efficiency of Fan-Units • Efficiency improvements from – Higher efficiency motor – Higher efficiency coupling – Higher efficiency fan • Improvements to fan from reducing losses – Mechanical losses – Volumetric losses – Aerodynamic losses (greatest opportunity) 7. Market Barriers and Failures • Key market failures & barriers which can reduce uptake of energy efficient equipment – Split incentives (also known as principalagent problems) – Information failures, including information asymmetry – Bounded rationality Market Failures – Split Incentives • Split incentives occur when one party pays another party for a good or service but these parties have different incentives. – Classic example is tenant-landlord situation – may apply to a ventilation system in a new building. – In SMEs failed fan units might be replaced by a contractor, who doesn’t pay the energy bills. Likely to replace like-with-like as this reduces time to select a replacement, reduces equipment and installation costs and reduces the risk that the fan won’t operate effectively. – Even if a firm has in-house expertise, the department which is responsible for replacing the fan is unlikely to be the cost-centre for the energy bill, and restoring production as quickly as possible is likely to have a higher priority than saving energy. – The design of new fan installations is often allocated to consultants, who may have time and money constraints, and some rely on existing design blueprints. Specifying a high efficiency model may waste time in searching for suitable products and in convincing the client that this is a better solution – higher first cost and the perceived risk of different technology can militate against customer acceptance. Market Failures - Information • Information failures result when the customer does not have access to the information which will allow them to make an optimal decision regarding energy efficiency – especially the case where equipment such as fans are not ‘energy rated. – Fan efficiency is usually presented in technical catalogues as performance curves. These curves require quite a high level of expertise to understand and apply properly to fan system design and replacement fan selection. – A proven government policy response to information failures is the mandatory disclosure of energy performance, eg Energy Rating Labels. However, fans used in industry face a much wider range of applications and duty cycles and are not suited to this type of simplified rating scheme. – In addition, non-domestic fans are not purchased from the shop floor, and so consumer energy labelling is likely to be ineffective. Market Failures – Bounded Rationality • Bounded rationality exists when, even though individuals have sufficient information, they make suboptimal decisions – may resort to rules of thumb or cultural/organisational norms. – Suppliers have advised that consultants designing new systems often use old blueprints as the basis of new installations. – Fans are just one element of an overall fan system where they are required to perform a specific function, and are chosen to meet the operational requirements of the system. Energy efficiency is only a secondary characteristic of a fan. – Suppliers have noted that few customers consider the lifecycle costs of their fan purchasing decisions, even though the cost of energy accounts for around 67% of the overall lifecycle cost. In most cases consumers focus only on the upfront cost. – A key cause of bounded rationality is that energy represents only a small percentage of the operating costs of most firms, and is ‘non-core’ business. In Australia, energy costs represent only 3% of total expenditure in the industrial sector and 1.6% of expenditure in the commercial sector. 8. Approaches to Improving Efficiency • NZ and Australia have a history of implementing efficiency regulations to drive improvements to the efficiency of new products sold – Energy Labelling often used for domestic products – MEPS combined with a HEPS have been used for a range of non-domestic products International Situation Labelling Scheme Country / Region MEPS Test Standard Non-Domestic Fans China In place Denmark Philippines In place, voluntary Under Consideration USA EU ISO 5801 ISO 5801 ISO 5801 In place, voluntary From 2013 ACMA ISO 5801 Ventilation Systems Denmark In place, voluntary Republic of Korea In place, voluntary Sweden In place, voluntary UK In place ISO 5801 European Eco-Design Directive • Under the Energy Using Products Directive, regulations commencing in 2013 will remove the least efficient ventilation fans from the market. • The regulations will be introduced in two stages: – First tier: from 1 January 2013 is intended to target the bottom 10% of the market in terms of efficiency; – Second tier: from 1 January 2015 is intended to target the bottom 30% of the market in terms of efficiency. Scope of EU Fan Regulations • The EU regulations are based on the efficiency of the fan-unit (fan+motor), and cover fan-units with input power ratings from 125 Watts – 500 kW for the following fan types: – – – – – – – Axial fans Centrifugal radial bladed fans Centrifugal forward curved fans Centrifugal backward curved fans without housing Centrifugal backward curved fans with housing Cross flow fans Mixed flow fans Exclusions from the EU Fan Regulations • The EU regulations specifically exclude the following: – Fans designed to operate in potentially explosive atmospheres – Fans designed for emergency fire safety use only, at short-time duty – Fans specifically design to operate at temperatures exceeding 100°C (gas being moved) or 65oC (ambient air temperature for the motor if located outside of the air stream) or at a temperature below -40°C (air being move or ambient temperature for the motor) – Fans designed with a supply voltage >1000 V AC or >1500 VDC – Fans designed to operate in toxic or highly corrosive environments – Fans integrated into products with a sole electric motor of 3 kW or less where the fan is fixed on the same shaft used for driving the main functionality – Fans integrated into certain products, including laundry and washer dryers with a power input of 3 kW or less, and kitchen ventilation hoods with a fan power input of less than 280 Watts • The requirements of the regulations will also not apply to fans which are designed to operate: – With an optimum energy efficiency at 8,000 rotations per minute or more; – In applications in which the “specific ratio” is greater than 1.11; and, – As conveying fans used for the transport of non-gaseous substances in industrial process applications. Standards used for EU Regulations • ISO5801:2008, a well-established standard for testing the efficiency of a fans, will be the energy performance test standard used to underpin the EU regulations. • A joint US-UK led project has led to the creation of ISO12759 Fans – Efficiency classification for fans. – This standard sets out Fan Motor Efficiency Grade (FMEG) curves, which specify minimum allowable efficiency of fan units (fan+motor) at BEP point for different fan types over a range of motor input powers – Used to specify the MEPS levels Fan Motor Efficiency Grade Curves From ISO 12759 Other Approaches to Improve Efficiency • While there are currently no regulatory requirements for fan efficiency in NZ, EECA has recently commenced a number of projects to provide best practice guidance on fan systems: – With the Energy Managers Association of New Zealand (EMANZ) to develop system audit standards for fan systems (which will incorporate some US material); and – A project with the University of Waikato for a range of education and training courses for those engaged in system design, system auditing and systems management Initial Assessment of Policy Options • • • • Best practice programs help to address some information failures, but don’t address split-incentives and bounded rationality. A key benefit of best practice programs is that they cover the entire fan system. Provision of financial incentives in conjunction with the best practice programs is likely to significantly increase their impact, but would require a large financial outlay. Voluntary fan energy labelling is unlikely to be appropriate for nondomestic fans, as they face a wide variety of applications. It may be possible to have a voluntary “high efficiency” fan certification based on ISO12759. These schemes have similar drawbacks to best practice programs, in that they don’t address split-incentives and bounded rationality. Further, their coverage tends to be limited to certain suppliers and certain models. MEPS combined with defined voluntary “high efficiency performance standards” (HEPS) have been used in Australia. MEPS addresses split incentives and bounded rationality, and partially addresses information failures by limiting the market to products above a certain efficiency threshold. – Complementary HEPS helps to address information barriers by assisting consumers to identify the most efficient products. It can also facilitate government programs, such as rebates and white certificates. Regulating Fan vs Fan-Unit Issue Regulating the fan unit (fan+motor) Regulating the fan only Alignment with NZ legislation Feasible. Not possible in NZ as legislation relates to energy using products only and fan does not qualify. In Aust. forthcoming GEMS legislations would allow this. International alignment Aligned with the EU approach, which would minimise trade barriers for suppliers and manufacturers. Not aligned directly with the EU approach, and likely to impose additional testing costs for suppliers and manufacturers to demonstrate compliance with MEPS levels. Impact on fan efficiency Would not directly address the efficiency of the fan. However, due to the larger scope of coverage of MEPS there is the potential to drive greater efficiency improvements. Would directly address the efficiency of the fan, and drive improvements to only the fan. Establishing MEPS levels Potentially more complicated, as E3 would need to take into account the efficiency of the fan, coupling and motor when establishing MEPS levels. This would be less of an issue if Australia adopted international (eg EU) regulatory levels. More straight forward as E3 would only need to consider the fan. Alignment with market trends This is how majority of fans are sold, and there is an increased trend towards integrating the fan unit with a VSD. Also, testing would include all fan-unit components, including outer casing and motor which would give a more realistic indication of performance in practice. Most fans are sold to end-users with the fan attached to a motor, so could make it more difficult to verify compliance with MEPS levels. Issue with Incorporated Fans • Any fan regulations could be deemed to apply to all fans within scope regardless of their application or the extent to which they are integrated into other products. – While this would result in the widest possible coverage and potentially the greatest impact, this could make identification and registration of products difficult • Energy efficiency regulations could apply to the entire integrated product (eg gas ducted heater), but the efficiency metric could include the energy consumption of the fan. – This would mean that any efficiency improvements to the fan would contribute to improved energy performance of the product, but the impact on fan performance may be small • Specific fan efficiency requirements could be included as part of the MEPS specification of the product (eg gas ducted heater), especially where fan energy consumption is significant. – This would help to drive energy efficiency improvements to fans used in key applications where they are integrated into a product. 9. Potential Impact of MEPS • Two scenarios have been modelled to get a preliminary assessment of impact: – Scenario 1 is based on the approach currently being implemented in Europe, with MEPS targeting the least efficient 10% of fans introduced in 2013 and made more stringent in 2015 so they target the least efficient 30% of fans – Scenario 2 is similar, but assumes that MEPS targeting the least efficient 30% of fans is introduced in 2013, with no further increase in stringency. Modelling Approach • Use estimate of installed stock 2010 to 2030 as basis of stock model – Use stock and assumed energy characteristics of fans to prepare bottom-up estimate of fan energy use (and greenhouse emissions) – Annual sales of new fans is driven by growth in stock and retirement of old units – Assume average life of 15 years (50% failure) and normal distribution with standard deviation of 10 years – Split stock into 7 fan types based on EU categorisation – Assume NZ stock has same BAU efficiency characteristics as EU stock – When MEPS implemented the average efficiency of new products sold increases leading to energy and greenhouse savings Issues with Bottom-Up Modelling • Bottom up estimate of fan energy use is considerably lower than the high level estimate – This suggests that some underlying assumptions regarding fan unit operating characteristics may not be correct (eg average input power, average annual opeating hours, average efficiency) – Suggests that modelling is providigng a conservative estimate of the likely impact Assumed Fan Operating Characteristics Fan type Estimated Market Share Estimated hourly fan load (P x Q) (kWh/h) Typical Annual Operating hours 1 Wall mounted axial fan, static pressure <= 300Pa 8.2% 0.240 2,340 2 Wall mounted axial fan, static pressure > 300Pa 22.8% 0.494 2,340 3 Centrifugal, forward curved with casing 12.5% 0.132 3,500 4 Centrifugal backward curved without casing 3.9% 1.880 3,500 5 Centrifugal backward curved with casing 4.3% 2.292 3,500 6 Centrifugal backwards curved box fan 17.5% 0.111 2,000 7 Axial roof fan 30.8% 0.480 2,940 Based on EU data Assumed Distribution of Fan Efficiencies Cut off Fan Type 1 2 3 4 5 6 7 100% 40.0% 45.5% 37.5% 56.5% 65.0% 40.0% 52.5% 90% 35.5% 42.1% 34.1% 53.6% 62.8% 35.5% 46.9% 80% 33.7% 40.7% 32.7% 52.4% 61.8% 33.7% 44.6% 70% 32.2% 39.7% 31.7% 51.5% 61.1% 32.2% 42.8% 60% 31.0% 38.8% 30.8% 50.7% 60.5% 31.0% 41.3% 50% 30.0% 38.0% 30.0% 50.0% 60.0% 30.0% 40.0% 40% 28.9% 37.2% 29.2% 49.3% 59.5% 28.9% 38.7% 30% 27.7% 36.3% 28.3% 48.5% 58.9% 27.7% 37.2% 20% 26.3% 35.2% 27.2% 47.6% 58.2% 26.3% 35.4% 10% 24.5% 33.8% 25.8% 46.4% 57.2% 24.5% 33.1% 0% 20.0% 30.5% 22.5% 43.5% 55.0% 20.0% 27.5% Based on EU data Impact of MEPS on Efficiency of Average Fan Sold Fan Type 1 2 3 4 5 6 7 Based on EU data BAU 10% MEPS (Scenario 1 2013/14) 30% MEPS (Scenario 1, 2015/16) (Scenario 2, 2013/14) 30.0% 31.7% 33.1% 38.0% 39.3% 40.3% 30.0% 31.3% 32.3% 50.0% 51.1% 52.0% 60.0% 60.9% 61.5% 30.0% 31.7% 33.1% 40.0% 42.2% 43.8% Estimated Impact on Energy Use 1,050 60 1,000 900 40 850 30 800 750 20 Energy use 700 10 650 600 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 BAU MEPS -Scenario 1 Estimate for New Zealand MEPS -Scenario 2 Savings - Scenario 1 Savings - Scenario 2 MEPS Saving (GWh/Yr) 950 Energy Use (GWH/Yr) 50 Energy saving Estimate for New Zealand Type 1 Type 2 Type 3 Type 4 Type 5 Type 6 Type 7 20 30 20 29 20 28 20 27 20 26 20 25 20 24 20 23 20 22 20 21 20 20 20 19 20 18 20 17 20 16 20 15 20 14 20 13 20 12 20 11 20 10 Energy Saving from MEPS (GWh/Yr) Breakdown of Energy Savings 60 50 40 30 20 10 0 Estimated Greenhouse Abatement – Scenario 1 450 25 Greenhouse savings 20 350 15 300 10 Greenhouse Emissions 250 5 200 0 2010 2011 2012 2013 BAU 2014 2015 2016 MEPS -Scenario 1 Estimate for New Zealand 2017 2018 2019 2020 MEPS -Scenario 2 2021 2022 2023 2024 Savings - Scenario 1 2025 2026 2027 2028 2029 Savings - Scenario 2 2030 Greenhouse Saving (kT/Yr) Greenhouse Emissions (kT/Yr) 400 Cost-Benefit Analysis – Assumed Costs Fan Type Initial average cost Average cost – 10% MEPS Initial average cost – 30% MEPS 1 Wall mounted axial fan, static pressure <= 300Pa NZ$860 NZ$946 NZ$1,032 2 Wall mounted axial fan, static pressure > 300Pa NZ$860 NZ$946 NZ$1,032 3 Centrifugal, forward curved NZ$1,230 with casing NZ$1,353 NZ$1,476 4 Centrifugal backward curved without casing NZ$4,916 NZ$5,408 NZ$5,899 5 Centrifugal backward curved with casing NZ$2,274 NZ$2,501 NZ$2,729 6 Centrifugal backwards curved box fan NZ$2,471 NZ$2,718 NZ$2,965 7 Axial roof fan NZ$2,294 NZ$2,523 NZ$2,752 Summary of Impact Analysis MEPS Scenario 1 MEPS Scenario 2 2020 2030 2020 2030 Electricity savings (GWh p.a.) 28.3 52.8 31.2 54.5 Electricity savings ($M p.a.) $4.2 $9.0 $4.6 $9.3 Cumulative energy savings (GWh) 120 550 145 598 Greenhouse gas savings (kt CO2-e p.a.) 11.3 21.1 12.5 21.8 Cumulative greenhouse gas savings (Kt CO2-e) 48 220 58 239 NPV of savings (5%) discount rate ($M) $3.8 $36.9 $4.3 $39.6 1.4 3.7 1.4 3.5 Benefit-Cost ratio 10. Recommendations • Preliminary modelling suggests that a MEPS based on the EU approach could drive cost effective improvements to the efficiency of new fans sold • It is recommended that following consultation with industry stakeholders, the feasibility of implementing MEPS for non-domestic fans, based on the EU approach, be formally tested through the development of a Regulation Impact Statement (RIS) • Industry feedback on the range of assumptions used in the modelling presented in this Product Profile would assist greatly with the preparation of a robust RIS Key Questions for Further Discussion Scope of Focus on Fans • Do fans within the 125 W to 500 kW power range account for the majority of energy consumption of non-domestic fans, and are these the best focus for government efforts to increase the energy efficiency of fans? • Is it reasonable to omit other fan technologies, such as mixed flow and cross flow fans, from the analysis? Market Data • Is the import (and export) data on non-domestic fans accurate? • Is the information and data on the local manufacture of non-domestic fans available? • Accuracy of the installed fan stock estimate and the estimated level of sales? • Information on the installed fan stock in the agricultural and power generation sectors? • Information on the average energy characteristics of fans (input power, duty, efficiency) and spread of efficiencies of products currently sold? • In particular, information on the breakdown by main fan type, by end-use application (mining, manufacturing, commercial and water industry) and by size (motor input power) would assist with modelling. Market Failures and Barriers • Comment on the barriers and market failures which may be hindering the market uptake of higher efficiency fans used in non-domestic applications, and • The most appropriate policies for addressing these to drive improvements in the efficiency of the installed stock over time Possible Policy Options • Stakeholders are invited to comment on possible policy options for increasing the energy efficiency of non-domestic fans in New Zealand – If MEPS were introduced would you prefer Scenario 1 or Scenario 2 • Comment on the appropriate standards for measuring the energy efficiency performance of non-domestic fans is also welcome Modelling Assumptions • Comment on the key assumptions and data sources which underlie “top down” modelling of energy used by non-domestic fans • Comment on the key assumptions and data sources which underlie “bottom up” modelling of energy used by non-domestic fans; in particular feedback on the estimated size of the installed fan stock, and on the energy performance parameters. • Comment on the assumptions which have been used in the cost-benefit analysis, in particular the price premiums which have been assumed for the MEPS compliant fans. The Way Forward Where to from here? • Written submissions on Product Profile close Friday 6 July, 2012 – Feedback from industry stakeholders welcome – Feedback will be compiled and presented to E3 Committee for consideration – E3 Committee will make a decision on whether or not to proceed to prepare a RIS to test feasibility of implementing MEPS – May require some standards work, but ISO test standard already exists and could adopt ISO standard on fan efficiency grades • Please send written submissions on the Product Profile to: Non-domestic fan profile [email protected] • Submissions close Friday 6 July, 2012. • Can call Ian McNicol (Sustainability Victoria) to discuss: Ph: +61 3 8626-8772