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Maximize Value

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  1. Maximize Value How to get HIGH EFFICIENCY UTILITY SYSTEMS by using LOW EFFICIENCY COMPONENTS

  2. Presentation Format Presented by- Randall E. Witte, CEMrewitte@emc2conserv.com President, Emc2 ConServ, Inc. (Consultants specializing in utility cost reduction and environmental benefits) 1st Place, ASHRAE Industrial Energy Awards Soon-to-be Six-Sigma Black Belt This program is to help you examine the ideas you likely have about cutting utility costs, improving reliability and reducing environmental impact. Many techniques will be discussed, but this is NOT a typical “how-to-do" presentation. It is intended to guide you on “HOW-TO-THINK”.

  3. Presentation Format • Business needs • How did we get here? • Alternative approaches available • What does the FUTURE hold? • Government & Industry response • High Performance Buildings and Integrated Utilities • Paradigm Busters • Case Studies • #1- Existing Paper Manufacturing Plant • #2- New School Construction • #3- Large Office HVAC Upgrade • #4- Commercial Laundry Plant Concept • Wrap-up • Questions and Comments

  4. BUSINESS NEEDS & WANTS(Why we are all HERE today!)Virtually all organizations have similar needs- • Access to Reliable Energy • High Quality Energy Sources and Supplies • Stable Energy Prices (preferably cheaper) • Environmentally-Friendly Utility Systems • Low-Maintenance Utility Systems • High Reliability Utility Systems Unfortunately, they often run into the worst of all possible conditions-

  5. The REAL WORLD As utility users search for their energy nirvana they come face-to-face with all kinds of obstacles- • INTANGIBLES- It is becoming harder to define, control, and focus on the problem • PRICE / COST-BASED SOLUTIONS- Easy to define and quantify, but they often don’t actually SOLVE the problems • MISGUIDED EFFORTS- Faced with high quality, efficient & inexpensive imports, the auto industry focused on price because they didn’t realize that lower cost was the by-product of the quality and efficiency.

  6. How Did We Get Here? • Engineering services are considered “overhead”, so cost-control purchasing has caused “value design” to be replaced with “adequate design” effort

  7. How Did We Get Here? • Specialists are now focusing on efficiency for single components, or specific utility systems, that they understand

  8. How Did We Get Here? (cont’d) • Purchasing decisions are made based on CAPITAL cost without concern for LIFE CYCLE cost. Capital cost is only 8-12% of the TOTAL cost of system ownership.

  9. How Did We Get Here? (cont’d) • Utility operating cost evaluations were based on “past experiences” or current conditions. Future utility costs will depend on future events.

  10. Real Time or Time of Day Rates Production Constraints Energy Cost Volatility Administrative Demands Brokers & Negotiated Costs “Better Value” Supply Risk Interruptible Contracts Production Constraints Fuel Storage Space Additional Staff Training Alternate Fuel Choices Similar to “Interruptible” Utility System Cost Containment Typical Approaches & Concerns Supply Side Approach

  11. Utility System Cost Containment Typical Approaches & Concerns End-Use Approach Utility Data Management Administrative Demands “Lean Usage” Approach Focus on Discrete Usage “Systems” Approach “Lean”, but more thorough Energy Management System Facility Service Only Can Not Support Process Often Over-ridden On-Site Power Generation Additional Staff Training Specialty Maintenance Often Not Integrated

  12. Problems Resulting From Using Typical Savings Approaches • LIMITED “ASSURED” SAVINGS vs. INVESTMENT COST(ACCESS TO FUNDS) • RISK OF DISRUPTIONS TO PRODUCTION • SUSCEPTIBLE TO RAPID PRICE SWINGS • SUSTAINABILITY OF SAVINGS • SUBSTANTIAL ADMINISTRATIVE DEMAND • ADVERSE INTERACTIONS OF “SOLUTIONS” • FINGER-POINTING WHEN PROBLEMS ARISE

  13. What does the future hold? Fuel / Energy costs will continue to climb, driven by a variety of market and environmental influences- plus the fact there is a limited amount of fossil fuels available

  14. The future (Part 2) • OIL-Supplier issues • Several sources, but many unstable • Any disruption causes price spikes plus driven by China’s growing demand • Just became the #2 importer • Their economy is ONLY 3% of world GDP, growing at 10-15% annually • Adding jobs at 8-million per year

  15. The future (Part 3) • Natural Gas- Tends to track “oil” in cost per BTU • Current market conditions are showing skewed pricing due to low summer demand and “full” storage wells • Added demand pressure coming because it’s “clean”, and a key element in “hydrogen” economy

  16. The future (Part 4) • ELECTRICITY- Reasonable long-term option, but facing added costs that must be covered in rates • Major investment for stable “grid” • Additional generating capacity • Environmental issues increase construction and operating costs • Nuclear is viable long-term option, but faces significant investment, long lead times, and fuel storage.

  17. The future (Part 5) U.S. manufacturing (and housing) growth will “fuel” more domestic energy demand Opportunities for significant energy cost savings are available, but will require conscientious effort Organizations that proactively plan to reduce consumption will be more successful than their competition

  18. Government and Industry’s Response to the Problem Lots of “smart” folks trying to come up with simple “cookbook” regulations to solve the problem- • Developed by individual industry specialists • Proposed solutions are focused on energy components they understand • “Creativity” is allowed, but most engineers (and regulators) don’t understand utility systems and their relationships “K.I.S.S.” is usually NOT the best solution for a complex problem

  19. Today’s CHALLENGE Rule #1- Commercial and Industrial facilities are NOT residential structures. Rule #2- Most Building and Energy Codes tend to ignore Rule #1.

  20. Today’s SOLUTION Optimum efficiency (& lowest costs) at a facility occur when ALLcomponents work together toward a common result. There is no economic “value” gained in SPENDING MONEY to make a building more thermally and air-side “tight”, then having to SPEND MORE MONEY and MORE ENERGY to remove the trapped heat and contaminants.

  21. Finding the right path How business has responded to other needs- • PRODUCT QUALITY Failure analysis, Paredo Charts, ISO 9001 • PROCESS EFFECTIVENESS 6-Sigma Black Belt Analysis, Systems Re-engineering • ENVIRONMENTAL IMPACT LEED analysis, design, and operation, ISO 14001 Each “solution” requires commitment, thorough analysis, and big-picture perspective- and they solve problems COST-EFFECTIVELY.

  22. Achieving the Goal Winning a race at Le Mans needs a very different approach than the Indy 500 or a NASCAR event. • Fewer rules on equipment assembly, parts, or required fuel economy • Success means components are matched to specific needs and other components • Reliability matched to peak performance High Performance Building Design provides the right solution to today’s demanding business practices and utility operating needs.

  23. High PerformanceBuilding Design • Incorporates INTEGRATED UTILITIES Concepts • Designed & built based on intendedresults- and integrated into “PROCESS” • Life Cycle Performance becomes prime criteria for selecting facility components • THESE AREN’T HOUSES!

  24. KEY CONSIDERATIONS for High Performance Building Design- • Six feet back from any exterior wall is ALWAYS interior space. • Significant heat-producing systems (like computers) are generally always “ON” • Thermopane glass and high insulation holds excess heat inside the “box” • Many buildings operate at “net positive” heat down to below freezing outside temp.

  25. More CONSIDERATIONS for High Performance Building Design- • The Electric energy required to cool a space (remove heat) has a thermal cost ($/BTU) that is 200%-400% higher than the fuel required to add heat to a space. • Many “standard” utility system designs are not able to properly support actual space requirements because the designers did not understand all the dynamics of the building AND the occupants.

  26. TYPICAL “CENTRAL” PLANT UTILITIES ARRANGEMENTEach system designed for efficient, stand-alone operation

  27. The FACILITY is the SYSTEM • The structure, lighting, power, compressed air, heating, cooling, domestic water, refrigeration, sewer, fire protection, plus all of the process loads are ALL JUST SUB-SYSTEMS. • How well the sub-systems work together determines how well the FACILITY will work, and how much it will cost to operate & maintain.

  28. High Performance Utilities • “Integrated” utility systems- the by-product of one component becomes the input to another • Core components are matched to “continuous” loads and related utilities so system operates “steady-state” • Component “efficiency” doesn’t matter. High Performance Utilities recycle by-products • Modular components allow for peak loading • TOTAL component operating cost considered- utilities, maintenance, life expectancy, replacement Because energy purchases are recycled, there is much lower environmental (CO2, etc.) impact

  29. High Performance Concept • Sub-systems, the process, and the building, produce heat as a by-product of operation. • Integrated utilities produce electricity, extract heat (with distilled water refrigerant) and reject heat to “cooling” water. • Other sub-systems, including the process, are heat-using and can be significantly aided by the rejected utility heat put into “cooling” water or directly to the “user” device.

  30. INTEGRATED UTILITIES CENTRAL PLANT RELATIONSHIP

  31. Integrated Utilities are only limited by your imagination This approach is a GENERIC solution- • The value of generic solutions is their flexibility and adaptability • The previous slides have shown how you can integrate “normal” utilities • The next slides will show you (a little) just how far this concept can go and still show significant value

  32. Waste Water Treatment Plants(Another Integrated Utilities Application) • The size of a typical treatment plant (land area and components) is determined by- • Total Peak Design Flow • Contaminants to be Remediated • Ambient Weather (“bug” operating ranges) • A treatment plant for a large manufacturing complex might be $2.5 M, and need 2 acres of land at -20F. • By preheating the effluent (using excess heat from the plant processes) to 100F, the treatment plant cost can be lowered to $1.5 M and only 1 acre of land. • In addition to lower space requirements and cost, risk of plant operating upset is virtually eliminated

  33. Residential “Total Solutions”(Another Integrated Utilities Application) • To do “the right thing”, lots of folks buy 94% efficient furnaces. It’s only useful half the time, so they also get high-efficiency air conditioners. They spend about twice as much as “regular” units, but it’s worth it. • For LESS fuel than that new furnace needs, you could- • Make all the electricity you need to run your home • Use the rejected generator heat to run a cooling unit to extract heat from a ground loop (or your home in summer) • Use the combined rejected heat for ALL of your Hot Water • Then use the cooler rejected heat for your home(or pool) • Then use the cooler rejected heat for your garage • Then use the cooler rejected heat to melt snow & ice For about the same price as the Hi-E system

  34. Paradigm Busters • The following slides identify several issues where “common sense” and “conventional wisdom” is just plain WRONG. • We will present the ideas that are apparent “conflicts with reason”, then explain WHY they are the right way to handle a situation.

  35. Paradigm Buster #1 More insulation and tighter building’s will generally INCREASE operating costs and LOWER indoor air quality. The amount of “internal” heat from motors, lights, computers, and processes is usually well above the “skin” (perimeter walls and roof) losses of the building. A classic example is a large office complex built with glass walls. If you drive by on a cold winter morning, you will see the A/C system rejecting excess heat even after the perimeter losses have been covered. That’s before the people arrive.

  36. Paradigm Buster #2 Air Conditioning a factory can cost less to operate (and have a lower life-cycle cost) than if it’s just ventilated with exhaust fans. Exhaust fans take heat from lights, motors and plant processes that you have already “paid for” (or was free building skin load) and throw it away. Meanwhile, boilers are heating water or other process loads (heat you are removing). An Integrated Utility gathers that energy and puts it back into the process. Improved morale, higher productivity and reduced defects are additional side-benefits.

  37. Paradigm Buster #3 Economizers and other “free-cooling” systems waste energy, increase operating costs, and lower indoor air quality. Per #2, throwing away “already purchased” heat and buying more is a hidden money-waste. Economizers bring in outside air that is much “drier” than from a cooling coil. The inside air gets so dry that it is a great breeding ground for bacteria (50% RH has the highest mortality rate for “bugs”). Dry air also adds to sinus and skin problems, and encourages static- which is bad for your electronic equipment.

  38. Paradigm Buster #4 Increasing lighting levels can lower the utility costs of a manufacturing facility. With Integrated Utilities, a thermal device called a “generator” has a by-product called electricity that is used to run the lights. If you recycle waste heat from the lights back into the process with a thermally-driven cooling unit, ALL of the energy put into the generator stays in the building or the process. The increased lighting levels also improve the working environment and reduce accident rates.

  39. Paradigm Buster #5 Using low-efficiency motors reduces a plant’s utility costs. “By-product” electric heat is also a factor here. The electrical energy gets recycled much as the lighting does to lower the heat energy purchases. Depending on where the motors are located, they can also take the place of “normal” heaters, saving capital. These motors cut maintenance expense because it’s easy to rewind or rebuild them. Reliability improves because replacements are fairly easy to acquire.

  40. CASE STUDIESThese projects are not “how-to” teaching aids. They are guides- demonstrating the value of using a comprehensive approach to solving problems by studying how components perform, understanding relationships, and focusing on life-cycle costs. #1- Existing Paper Manufacturing Plant #2- New School Construction #3- Large Office HVAC Upgrade #4- Commercial Laundry Plant Concept

  41. Case Study #1 Existing Paper Manufacturing Plant

  42. Existing Conditions • 4-year old facility • State-of-the-art, using “best available” manufacturing technology systems • Main Utilities- Natural Gas and Electricity • Process utilities- 200# &125# steam, RO water, vacuum (dewatering), natural gas dryers • Process water from river (sand filter) • $25,000,000 annual utility costs

  43. Project Goals • This project was initiated to determine what opportunities were available to reduce the operating costs of the plant • The intent was to identify projects that could easily, and quickly, be installed and functional to minimize disruption to plant production

  44. Integrated Utilities Solutions (A FEW OF THE HIGH POINTS DEVELOPED) • “Unload” major electric motors w/ parallel hydraulic drives coupled to gas turbine (20% lower cost than electric generator and panel interface, easier to maintain)- THIS DRIVE CONCEPT IS CURRENTLY BEING PATENTED • Waste heat of turbine makes 15 PSI steam used to drive an absorption chiller, then residual “warm” exhaust gas goes to dryer line

  45. Integrated Utilities Solutions (A FEW OF THE HIGH POINTS DEVELOPED) • Chiller cools seal water for vacuum pumps, cutting power from 7400HP to 4800HP(data provided by the vacuum pump manufacturer) at equal vacuum capacity • Waste heat from chiller (thermal input plus heat from the water) preheats additional dryer line makeup air

  46. Additional Cost-Saving Ideas(A FEW MORE SELECTED OPPORTUNITIES) • Preheat RO input water with compressor waste heat (increased capacity, reduced membrane pressure drop) • Reclaim energy from dryer lines to further preheat inlet air after turbine & chiller preheat input and before burner • Convert open tank process CHW to closed-loop piping system w/ variable-flow to reduce baseline head losses and pipe corrosion pressure drop

  47. Additional Cost-Saving Ideas(A FEW MORE SELECTED OPPORTUNITIES) • Convert steam heating system to HTHW, eliminate trap maintenance expense, stand-by heat loss, plus water and energy losses from flash tanks. • Increased Compressed Air storage, tightly regulated air pressure in mains, and load controls to free up compressors • Reduce air volume of major Air Handlers to minimize reheat and lower fan HP (and energy costs)

  48. The Opportunity • Over 8 MW of electrical power eliminated • 40% of steam demand replaced • No reduction in plant capacity • Adequate utilities reduction and offset to allow 50% plant capacity growth without upgrading the utility infrastructure • $9,100,000annual utility savings(37%) • $12,700,000cost (17-month SPB) • 87,500,000 Tons of CO2 Saved Annually

  49. Case Study #2 New School Construction

  50. Project Description New High School Remodel and Expand Middle School New Elementary School Upgrade/Renovate Primary School Construction Budget– $46,000,000 Utility Systems Budget - $ 15,000,000 Projected Utility Cost Increase - $ 560,000 / yr (Added to Existing Utility Costs of$ 870,000)