Navigant Research Blog

Continuous Commissioning will Transform Energy Efficient Buildings

— October 17, 2012

Today, few buildings meet their energy efficiency and operational potential. High performance buildings such as those certified under LEED generally achieve high levels of efficiency not only at the point of design but also in the first years of operation.  These buildings, though, represent only a small fraction of the total building stock worldwide.  What’s more, efficient performance is guaranteed only in the first few years of operation, allowing buildings to drift outside their ideal energy and operational parameters over time as building use changes and systems degrade.

Today, the common approach to guaranteeing operational efficiency in buildings is through commissioning, or the systematic process of assuring that operational performance meets the builders’ intentions.  This approach is applied only at specified points in a building’s lifecycle, leaving long periods in between during which many systems operate unchecked and fall short of the high performance levels at which the buildings were initially designed to operate, often at considerable cost to the building owners.

In the last few years, the advent of building energy management systems (BEMS) has generated considerable talk of using continuous energy monitoring systems to ensure persistent high performance in buildings.  Applications such as fault detection and diagnostics (FDD) tie into a building’s automation systems and compare ongoing data to predicted performance metrics and alert managers when buildings operate outside their intended parameters.  Many believe that the type of ongoing visibility that an advanced BEMS provides will offer an opportunity to maintain buildings at their operational best, as shown in the diagram below.

Recommissioning versus Continuous Commissioning

(Source: Pike Research)

Such systems have been anticipated for years, and many BEMS developers already offer software platforms with continuous commissioning capabilities.  From a practical standpoint, however, continuous commissioning faces a number of hurdles that will slow its adoption in the near term.  For one thing, intelligent controls and sensors are hardly ubiquitous in buildings today.  Direct digital controls (DDC) represent the foundation of any continuous commissioning system, but adoption of DDC is patchy at best across the building stock, so many building owners or enterprises interested in continuous commissioning may be constrained by a lack of smart buildings under their control.

What’s more, given the relatively low priority of energy among many top-level corporate decision-makers as well as their lack of familiarity with BEMS, many potential BEMS customers today are opting for light (and, hence, less capital-intensive) solutions that exclude many of the deeper capabilities that market leading BEMS platforms offer today.  Continuous commissioning could be described as a premium feature rather than a must-have energy visualization and analytics capability, and it’s often passed over in enterprise energy management installations.

Over time, however, these barriers will be addressed, and continuous commissioning will become more commonplace.  As it does, it will influence the growing market for building commissioning services: It will fundamentally transform the recommissioning process, a once-every-few-years approach to commissioning, into a continuous, software-enabled process.  It will also create a virtuous cycle for basic commissioning and maintenance services, as continuous commissioning will generate leads for equipment repair and service that would otherwise have gone undetected until a major equipment malfunction.


CHP, Solar PV Move Microgrids into the Mainstream

— October 16, 2012

Microgrids are really just miniature versions of the larger utility grid, except for one defining feature: when necessary, they can disconnect from the macrogrid and can continue to operate in what is known as “island mode.”  Because of this distinguishing feature, microgrids can offer a higher degree of reliability for facilities such as military bases, hospitals and data centers, which all have “mission critical” functions that need to continue to operate no matter what.

Along with enhancing reliability, microgrids serve another useful function: they can help the larger grid stay in balance.  As the world moves toward an energy system that looks more and more like the Internet, with two-way power flows thanks to growing reliance upon on-site sources of distributed generation (DG), this increasingly dynamic complexity requires new technology.  But some forms of DG – especially variable renewable resources such as solar or wind — create a greater need for smart grid solutions, such as microgrids.  For example, recent trends in declining prices for solar photovoltaic (PV) systems certainly increase the need for aggregation and optimization technologies.  Why? Distributed solar PV systems can create frequency, voltage, and other power-quality challenges to overall grid operations.

But how much solar PV will actually be deployed within microgrids over the next 6 years all around the world? This is one of the questions addressed in my latest report, Microgrid Enabling Technologies.

Anchor Resource

In order for a microgrid to continue operating in island mode, it has to include some form of on-site power generation.  Without DG, a microgrid could not exist, so these DG assets are the foundation of any such localized smart grid network.

The ideal anchor resource for any microgrid is actually combined heat and power (CHP); a total of 518 megawatts (MW) of CHP capacity that will be deployed in microgrids this year.  This technology leads all forms of microgrid DG deployments today and will continue to hold the edge by 2018 (with 1,897 MW, representing more than $7 billion in annual revenues)  Given that it is a base load electricity resource that also provides thermal energy, today’s microgrid CHP capacity is the largest of any DG option besides diesel generators.

The bulk of CHP installations are with grid-tied systems within institutional campus environments.  The current low cost of natural gas in North America translates into the ability for microgrids to provide lower cost energy services than the incumbent utility grid.  For example, the University of California San Diego microgrid is saving over $4 million annually thanks, in large part, to on-site combustion of natural gas.

Still, Pike Research believes that declining solar PV costs will be one of the largest drivers for microgrids worldwide, and in terms of numbers of new installations, solar PV will be the market leader.  (CHP will lead in terms of total capacity due to the relative scale of CHP systems compared to solar PV.)  With the price of solar PV reaching grid parity in key markets by 2014 and 2015, the variability of this DG resource will necessitate a greater reliance upon energy storage (as well as the networking function of microgrids).  All told, this microgrid solar PV market adds up to almost $2 billion globally by 2018.

Total Microgrid Distributed Generation Vendor Revenue, Average Scenario,
World Markets: 2012-2018

(Source: Pike Research)

If one also includes distributed wind and fuel cells in the overall microgrid DG mix, this segment of microgrid enabling technologies is, by far, the largest target of new investment: 3,978 MW of new generation capacity valued at more than $12.7 billion (see the chart above).


Coming Soon: A Tax on Miles Driven

— October 11, 2012

Ever since alternative fuel vehicles became a possibility, governments worldwide have wholeheartedly supported efforts to reduce greenhouse gas emissions through increased fuel efficiency standards and alternative fuel vehicles.  As average fuel economy of new vehicles increases, and natural gas, hybrid, and electric vehicles become more prevalent, those efforts are finally gaining traction.  These efficiency gains have been encouraging, but state highway and transit authorities, which derive funds for road maintenance and development through taxes on gasoline, are beginning to feel a financial crunch that will only worsen as more vehicles crowd roads while consuming less gasoline.

To confront the looming shortfalls, transportation agencies are trying to develop new revenue streams.  Among the possible options is the vehicle miles traveled (VMT) tax, which has been popular but controversial.  The justification behind the VMT tax is that the more miles a motorist drives, the more he or she should contribute to road maintenance and development.  Administering the tax, though, requires tracking mileage driven, fueling concerns over invasions of privacy.

Essentially a VMT tax is like paying a toll, except the tolling becomes more prevalent.  In England, members of parliament are advocating expanding road tolls as a solution to the estimated $3.2 billion loss in revenue due to decreased gasoline and diesel sales.  Unfortunately for motorists and governments, toll booths cannot be placed on all roads cost-effectively, and their presence increases traffic congestion.

Therefore, VMT taxes will most likely work through in vehicle devices (i.e., virtual toll booths) that track VMT through GPS and vehicle to infrastructure (V2X) technologies.  The adoption of GPS and V2X technologies will make payment seamless for the motorist, and give state and city governing agencies the ability to develop dynamic pricing schemes that not only fund road maintenance, but also can be used to manage traffic congestion.  Again, the problem with this scenario is that it means governing agencies will have to track privately owned vehicles.

Despite these concerns, transportation agencies in Minnesota, Portland, Washington D.C., and at the University of Iowa are testing VMT tax simulations, examining everything from participant reaction to congestion mitigation.  The University of Iowa study showed that, though a majority of participants were at first wary of the program, once they had experienced the actual ease of the system, a majority (roughly 70%) left the trial with a positive feeling toward the VMT tax.  In Portland, a dynamic pricing scheme showed a 22% drop in VMT at peak hours.

Opponents of these schemes will have to come up with better solutions to manage congestion and fund road maintenance.  A worst case scenario unfolded in China early this month, when the government suspended highway tolls for the Golden Week holiday; the resulting traffic congestion has been blamed for 794 deaths.


No Halt to Stop-Start Vehicle Technology Advances

— October 11, 2012

The latest Pike Research report on Stop-Start Vehicles has been published for less than a month, and already more new developments have emerged.  On October 2, Lamborghini said it will implement a stop-start system from Continental that features Maxwell ultracapacitors.  All models of the Aventador, which goes into production in late 2012, will feature the new system.  Using ultracapacitors to handle the electric power surge required to start the V-12 engine in 180 milliseconds allows the company to reduce the size and weight of the battery.  The stop-start system is estimated to contribute about 7% of the 35% goal (by 2015) that Lamborghini has set to reduce the CO2 emissions of its new models.

System design was reportedly done by Maxwell’s Italian distributor Dimac, with production responsibility handed over to Tier One supplier Continental.  Undoubtedly Continental’s experience supplying Maxwell’s ultracapacitors to PSA Peugeot Citroën for its second-generation e-HDi stop-start system were a factor in landing this business.

On October 3, Tier One supplier Denso debuted a Li-ion battery pack designed specifically for stop-start applications.  The system comprises high-power battery cells from a Tier Two source packaged with a power supply control switch and a battery management unit to monitor the charge levels.  The pack is designed to be air-cooled and does not require any additional hardware to modulate the temperature.  The system is reportedly going into production on the Suzuki Wagon R this month.

These two announcements illustrate different approaches to address the practicalities of powering a stop-start system.  With a charge-discharge cycle rate of typically 10 times that of a conventional vehicle, the traditional automotive battery simply cannot cope, and most production systems feature heavy duty absorbed glass mat batteries.  As Li-ion cells get cheaper thanks to the hybrid and electric vehicle usage demand that is pushing volumes up, the greater power capacity is attractive for stop-start systems.  The alternative is to keep a low-cost basic battery to handle the steady loads of lighting, ignition, information and entertainment systems, and HVAC, and supplement it with a high power device such as an ultracapacitor to handle rapid charging and discharging.  Both systems require robust electronics to manage the stored electrical energy effectively.

Both these systems have advantages and disadvantages, and as with most things automotive, the tradeoffs are in cost, size, and performance.  We expect to see further announcements of new batteries and energy storage technologies for stop-start systems in the coming months as OEMs begin to implement the fruits of their recent research.  Evidence of this in the United States, where the EPA testing doesn’t include enough stopping to demonstrate the practical benefits of stop-start technology, can be seen in Ford’s recent PR efforts to raise awareness.  Those benefits are too important to ignore under the pressure of increasing legislation and the consumer demand driven by rising fuel prices.


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