Navigant Research Blog

On the High Plains, Wind Industry Comes into View

— September 25, 2014

Most of us who study the utility industry know that utility-scale wind generation has been rapidly growing in many parts of the country, but I think we have chronically underestimated the impact and potential of this resource as an electric power generation resource and a totally clean and green contributor to many states’ renewable portfolio standard (RPS) targets.

Driving cross-country from San Francisco to our cabin in Northern Wisconsin this summer on I-80, I was amazed by the number of large-scale wind farms we saw in every state.  Through Nebraska and Iowa, I kept seeing flatbed semi-trucks with 100-plus-foot wind generator blades heading west.  Other trucks had tower tubes and generator unit housings as well.  It was clear to me that something was really happening here.  As we crossed the state line into Iowa, we passed a rest area with a huge 148’ turbine blade mounted vertically to honor the wind industry.  As tall as a 15-story building, the blade was donated by Siemens.

I was also struck on the drive by the ubiquity of high-voltage transmission power lines, large-scale substations, and huge coal-fired generation plants on the horizon.  The utility-scale wind farms were a welcome diversion and a signal that the power generation and transmission system industry is moving on.

More on the Horizon

Later in July we headed back to the Bay Area, taking the northern route, following I-90 across western Minnesota and South Dakota.  Again, the prevalence of utility-scale wind farms was striking.  However, the landscape, crisscrossed with new high-voltage transmission lines, was also remarkable and signaled to me that utilities and investment firms (through companies like Berkshire Hathaway Energy) are doubling down on their $15 billion investment in wind generation and the transmission infrastructure needed to support our country’s electric capacity requirements as coal and nuclear generation resources are retired in the next few years.  Berkshire Hathaway Energy also has another $15 billion in reserve.

The following graphic produced by the National Renewable Energy Laboratory (NREL) shows the wind energy potential across the nation.

Wind Energy Intensity, United States

(Source: National Renewable Energy Laboratory)

You can see why utility-scale wind power is happening primarily between the Texas Panhandle and the borders of North Dakota.  In fact, Southwest Power Pool says that its major congestion problem is now in the Omaha to Kansas City to Texas Panhandle region, which explains why there are now double the high-voltage transmission lines going north and south as well as east and west at the Minnesota/South Dakota border at Sioux City.  Based on what I saw through our car window, I expect more investment in both utility-scale wind generation in the region and the high-voltage transmission systems necessary to deliver that energy to diverse population centers.

 

Building Systems Learn to Communicate

— September 25, 2014

In the Hype Cycle, the Internet of Things (IoT) has reached the peak of inflated expectations and may even be over-hyped.  Many observers have commented on its adoption in home automation, high-voltage transmission systems, and smart cities.  The state of IoT in commercial building automation is murkier.

In a recent survey of building professionals administered by CoR advisors, 41% of the respondents reported not being familiar with the term “Internet of Things.”  Hype about IoT in building automation, it seems, is lagging, but its promise may be just as enticing in buildings as in other applications.  Indeed, more respondents indicated that they think the IoT will have an effect on how their building is run over the next 2 to 3 years than those who indicated they were familiar with it.

At a certain level, machine-to-machine communications, the foundation of the IoT, have been present in building automation systems (BASs) for decades.  In heating, ventilation, and air conditioning (HVAC), a temperature sensor can communicate with a variable air volume box to modulate the supply of conditioned air.  In turn, this variable air volume box communicates with an air handling unit that supplies the proper amount of air.  In most buildings, this happens on the HVAC control network.  The promise of IoT is for this to happen not on a network, but on the network, for any machine to communicate with other machines.

Open Sesame

This integration is happening.  Daintree Networks, for instance, offers seamless HVAC control, lighting control, and power metering.  Similarly, Automated Logic has introduced solutions to integrate different control silos.  One of the most interesting integrated deployments is the Government Services Agency headquarters in Washington, D.C.  The building management system knows when an occupant badges in, where that person is going, and what temperature they want the space they’ll occupy.  The next step is getting building automation to interact with a mobile phone or an automobile.

Unlocking the promise of IoT requires multiple companies and multiple systems to interact with each other.  It requires disparate BASs to not only communicate with other BASs, but to also communicate with anything.  Thankfully, the industry is moving in that direction.  Over the past 20 years, open protocols, such as BACnet, LonTalk, DALI, and Modbus, have gained widespread acceptance.  Unfortunately, they don’t communicate with each other very well.

Another survey, this one by Echelon (which recently announced an increased focus on the IoT), outlined the path to IoT in buildings.  Seventy percent of respondents reported that they plan to integrate disparate BASs onto a common platform.  Nearly a third of respondents indicated a plan to do so in the next 12 to 18 months.  Regardless of whether the IoT is over-hyped or unfamiliar, it’s coming to commercial building automation systems soon.

 

Green Roofs Sprouting Up Globally

— September 18, 2014

Many cities have mandated increased energy efficiency in buildings and, in some cases, net zero energy use by buildings.  A variety of solutions is needed to meet these goals; some are cutting-edge digital technologies, while others have been around for thousands of years.  Green roofs, one of the oldest energy-saving technologies, are becoming increasingly popular and having an impact on sustainability efforts.

Modern green roofs employ advanced design and materials to provide residents with rooftop oases while saving energy.  There are two primary types of green roofs: extensive green roofs, which generally have 2 to 12 cm of planting medium and are designed to be virtually self-sustaining; and intensive green roofs, which are far more complex and act as rooftop parks and gardens.  Intensive green roofs have soil depths of more than 12 cm and can include shrubs, small trees, and conventional lawns.  Given the amount of materials and the additional weight required for intensive designs, they are not suitable for all roofs.  Companies such as Illinois-based TectaGreen have been installing various types of green roofs on buildings across the United States for many years.

Cool Under Cover

Green roofs have been used for centuries to provide insulation and protect roofing materials, and they provide many benefits to building owners, occupants, and the general public.  Rooftop vegetation offers several public benefits; it improves urban air quality, manages stormwater runoff, and helps moderate the urban heat-island effect.  But it’s the private benefits for building owners that are primarily driving the market for green roofs.

The most direct benefit is reducing the amount of energy required to heat and cool buildings.  Several studies have shown that installing a green roof reduces summer cooling needs and winter heat loss by as much as 26%.  Green roofing can also extend the lifespan of a roof by protecting the waterproofing membrane from ultraviolet radiation and physical damage.  Other benefits include noise reduction, the reduction of electromagnetic radiation, and compliance with building codes such as Leadership in Energy and Environmental Design (LEED).

Small but Growing

While costs for green roofs have dropped in recent years, there is an ongoing debate over their cost-effectiveness and payback period.  Installed costs of green roof systems can vary dramatically; extensive roofs (shallower) generally cost from $10 to $23 per square foot to install.  Intensive roofs can cost anywhere from $25 to $220 per square foot and may require regular maintenance.  Some argue that at those prices, green roofs cannot pay back their installation costs.  But it can also be argued that the most important benefits are those that are not easily quantified.  What’s more, compared to other, more intrusive energy efficiency measures, green roofs are relatively inexpensive.

Despite the cost, green roofs continue to be installed around the world.  Navigant Research’s recent Zero Energy Buildings report discusses the efforts underway to lower building energy consumption; green roofs represent a small but growing part of that effort.  In addition to energy efficiency, green roofs are part of a growing movement to improve the sustainability of urban environments and reconnect residents with the natural environment that their cities have largely erased.  They are sure to grow in popularity over the coming years.

 

Hybrids Need a Refresh

— September 18, 2014

Worldwide sales of hybrids through August were off 9% over sales during the same period in 2013.  The drop contrasts starkly with the last 3 years, which have seen January-August sales rise 65% from 2011 to 2012 and 24% from 2012 to 2013.  While the market for hybrids is certainly not going away – 2014 sales will likely hit 400,000 by year-end – it is becoming significantly more competitive, and expansion outside of the midsize hatchback segments that hybrids crowd is just not happening.

Toyota’s introduction of the Prius family in 2012, alongside a market for plug-ins that was limited to few costly models, signaled a revival of the hybrid market.  Since then, though, plug-in makers have cut costs sharply, and the number of available models has grown considerably.  Only 1/20th the size of hybrid market in 2011, sales of plug-ins are now one-quarter of hybrid sales.  Meanwhile, the difference between hybrids and conventional gas- and diesel-powered vehicles in terms of fuel economy is shrinking.

Weight Loss

Driven by Corporate Average Fuel Economy (CAFE) standards, automakers are introducing vehicles with stop-start systems that are already widely popular in Europe and have significant weight reductions through materials engineering and engine downsizing.  Tracked by the University of Michigan Transportation Research Institute (UMTRI), the average new vehicle sold in the United States hit 25.8 mpg last month ‑ 5 mpg higher than the 2008 average.

All of this means that, for new hybrids to succeed, they must show significant fuel economy savings over conventional competitors ‑ and at a price point significantly lower than plug-in rivals (minus government subsidies).  Or they must be new: they have to fill a segment outside the densely populated small hatchback or offer cutting-edge technologies that can grab some of the spotlight that Tesla, Nissan, BMW, and Chevrolet eat up with each new plug-in electric vehicle (PEV) introduction.

Ford has announced it will introduce a new dedicated hybrid – another small hatchback — to compete with the Prius in late 2018, and industry sources believe that Hyundai may also soon join the fray.  But the wisdom of these introductions is questionable if current trends continue.  Breaking into the cross-over market, as plug-ins are poised to do next year with the Model X and Mitsubishi Outlander PHEV, would do much to keep hybrids relevant.  Bringing a diesel hybrid over from Europe would also help capture car buyers’ imaginations.

 

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