Navigant Research Blog

A New Way to Evaluate Energy Efficiency

Alvin Chen — May 9, 2016

HVAC RoofAt a high level, energy efficiency retrofits can be challenging to evaluate. Often, decision makers would like to see a rough estimate on simple payback; however, many case-by-case variables make common energy conservation measures either a quick payback for some projects or unrealistic for others. Some of these variables include baseline energy consumption, utility rate structures, facility hours of operation, climate, and implementation costs. For instance, a solar thermal water heating system would generate more energy savings for a facility that consumes more hot water and is located in a climate with high solar insolation.

It would be inaccurate for a facility manager to compare the simple payback from a different facility to their own without knowing how the operating conditions and potential install costs would vary. While payback is generally the most important factor in deciding on energy efficiency retrofits, the American Society of Heating and Refrigeration and Air-Conditioning Engineers (ASHRAE) recently published a report analyzing efficiency in a unique way.

Energy Efficiency without Cost Consideration

ASHRAE has provided a study analyzing the efficiency potential of commercial and multi-family buildings if cost is not a consideration. After examining 400 measures, the top 30 were chosen for additional analysis and modeling on prototype buildings in various climate profiles already consistent with ASHRAE 90.1-2013 standards. Sixteen buildings were profiled in 17 different climate zones, and the resulting national weighted energy consumption for the buildings was nearly half when compared to ASHRAE 90.1-2013 standards.

Additional study details and the 30 measures evaluated are also available. While cost is generally the most important factor in deciding on efficiency improvements, removing the cost from this analysis provides value in allowing facility designers to realize which systems could provide the most energy savings and helping them find ways to implement those designs at lower costs. Additionally, those developing standards can better determine which efficiency retrofits may provide the most savings independent of cost.

Non-Energy Benefits

Facility managers should also consider the additional benefits of energy efficiency improvements beyond just energy costs. Efficiency can boost residual facility value by improving staff productivity and retention, marketing potential, tenant satisfaction, competitive rent prices, sales, and academic performance. Building owners looking to simplify their energy management efforts may decide to partner with an energy services company that can provide feasibility studies to help scope energy savings opportunities.

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